Company: ZDAN
Filing Date: 2025-01-10
Form Type: DRS/A
Source: 0001683168-25-000168
Chunk: 44

Company: Zerolimit Technology Holding Co. Ltd.
Filing Date: 2025-01-10
Form: DRS/A
Chunk 44
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 part of its assets become subject to liens or rights of third-party creditors, we may be unable to continue our business activities,
which could materially and adversely affect our business, financial condition and results of operations. Under the contractual arrangements,
the VIE may not, in any manner, sell, transfer, mortgage or dispose of its assets or legal or beneficial interests in the business without
our prior consent. If the VIE undergoes a voluntary or involuntary liquidation proceeding, any independent third-party creditors may
claim rights to some or all of these assets, thereby hindering our ability to operate our business, which could materially and adversely
affect our business, financial condition and results of operations.

Contractual arrangements in relation to the VIE may be subject to scrutiny by the PRC tax authorities and they may determine that WFOE or the VIE owe additional taxes, which could negatively affect our financial condition and the value of your investment.

Under the applicable PRC
laws and regulations, arrangements and transactions among related parties may be subject to audit or challenge by the PRC tax authorities.
We could face material and adverse tax consequences if the PRC tax authorities determine that the VIE contractual arrangements were not
entered into on an arm’s-length basis in such a way as to result in an impermissible reduction in taxes under applicable PRC laws,
rules and regulations, and adjust the income of the VIE in the form of a transfer pricing adjustment. A transfer pricing adjustment
could, among other things, result in a reduction of expense deductions recorded by the VIE for PRC tax purposes, which could in turn
increase their tax liabilities without reducing WFOE’s tax expenses for accounting purposes. In addition, the PRC tax authorities
may impose late payment fees and other penalties on the VIE for the adjusted but unpaid taxes according to the applicable regulations.
Our financial position could be materially and adversely affected if the tax liabilities of the VIE increase or if it is required to
pay late payment fees and other penalties.

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Certain judgments obtained against us by our shareholders may not be enforceable.

We are a Cayman Islands
exempted company and the majority of our assets are located in the PRC and held by the VIE. All of our current operations are conducted
in the PRC. In addition, all of our current officers and directors are nationals and residents of China and all of them are currently
located in China, with the exception of one nominee independent director who resides in the United States and