Company: ZDAN
Filing Date: 2025-07-28
Form Type: F-1/A
Source: 0001683168-25-005450
Chunk: 3

Company: Zerolimit Technology Holding Co. Ltd.
Filing Date: 2025-07-28
Form: F-1/A
Chunk 3
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 Cayman's corporate structure, see “Corporate History and Structure.”

Our Company is not a Chinese
operating company, but rather a Cayman Islands holding company with no material operations of its own. Our Company conducts its operations
through its subsidiaries via a series of contractual arrangements with the VIE incorporated in the PRC. Our corporate structure involves
uncommon risks to investors as they are purchasing equity securities in a Cayman Islands holding company, and not equity securities of
the VIE based in China. However, due to our indirect relationship with the VIE through the VIE Agreements, we are regarded as the primary
beneficiary of the VIE for accounting purposes under the United States generally accepted accounting principles (“U.S. GAAP”).
Our PRC counsel has advised us that as of the date of this prospectus, there are substantial uncertainties regarding the interpretation
and application of the current and future PRC laws, rules and regulations related to VIE Agreements. See sections entitled “Corporate Structure and History” and “The VIE Agreements” for additional information related to our VIE structure and related
matters.

The VIE Agreements have
not been tested in a court of law in China as of the date of this prospectus. Such risks exist throughout the period in which we intend
to operate certain portions of our business through contractual arrangements with the VIE in accordance with the VIE Agreements. The
VIE Agreements may not be as effective in providing operational control. For example, the VIE and all shareholders of the VIE
(the “VIE Shareholders”) could breach their contractual arrangements with us by, among other things, failing to conduct the
VIE’s operations in an acceptable manner or taking other actions that are detrimental to our interests. If we had direct ownership
of the VIE, we would be able to exercise our rights as a shareholder to effect changes in the board of directors of the VIE, which in
turn could implement changes, subject to any applicable fiduciary obligations, at the management and operational level. However, under
the current contractual arrangements, we rely on the VIE and the VIE Shareholders to perform their obligations under such contractual
arrangements so that we can exercise operational control for accounting purposes. The VIE Shareholders may not act in the best interests
of our Company or may not perform their obligations under these contracts. We are also subject to the risk that the PRC government could
disallow the VIE structure