Company: KPEA
Filing Date: 2025-01-14
Form Type: 10-K
Source: 0001493152-25-002124
Chunk: 831

Company: Kun Peng International Ltd.
Filing Date: 2025-01-14
Form: 10-K
Item: Item 1B
Chunk 831
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 the New Measures for Cybersecurity Review (the “New Measures”),
which amended the Measures for Cybersecurity Review (Draft Revisions) released on July 10, 2021. As our VIE has less than one million
customers, we believe that the Measures are not applicable to us in current form. The PRC government is increasingly focused on data
security, recently launching cybersecurity review against a number of mobile apps operated by several US-listed Chinese companies and
prohibiting these apps from registering new users during the review period. There are great uncertainties regarding the interpretation
and enforcement of PRC laws, rules, and regulations regarding data and privacy security. We may be required to change our data and other
business practices and be subject to regulatory investigations, penalties, increased cost of operations, or declines in issuer growth
or engagement as a result of these laws and policies.

80

Cash
Transfers Within our Organization

As
between the Company and its subsidiaries, cash will generally be transferred by means of capital contributions and/or interest-free intercompany
loans. Cash to be transferred or settled between the Company and its subsidiaries, on the one hand, and the consolidated VIE and its
subsidiaries, on the other hand, will typically be transferred through payments for fees under our contractual arrangements with the
VIE, expense reimbursements, or intercompany borrowings between the Company or one of its subsidiaries and the consolidated VIE. Any
such loans will be interest-free, unsecured and payable on demand. For more information regarding these contractual arrangements, see
“Item 1. Business - Corporate History and Structure - Contractual Arrangements.” The enforceability and treatment of the
intercompany agreements within our organization, including intercompany borrowings and the contractual arrangements with our VIE, have
not been tested in court. To the extent cash and/or assets in the business are in the PRC and/or Hong Kong or our PRC and/or Hong Kong
entities, such funds and/or assets may not be available to fund operations or for other use outside of the PRC and/or Hong Kong due to
interventions in or the imposition of restrictions and limitations imposed by the PRC government on the ability of the Company or its
subsidiaries to transfer cash and/or assets. There are no tax consequences for intercompany borrowings or the payment for intercompany
services, except for the standard value added taxes and/or income taxes for the revenues and/or profits generated from such services.

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