Company: MKDWW
Filing Date: 2025-04-03
Form Type: 20-F
Source: 0001641172-25-002607
Chunk: 23

Company: MKDWELL Tech Inc.
Filing Date: 2025-04-03
Form: 20-F
Item: Item 3
Chunk 23
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 PRC regulations on loans to and direct investment in PRC entities by offshore holding
companies, we cannot assure you that we will be able to complete the necessary government registrations or obtain the necessary government
approvals on a timely basis, or at all, with respect to future loans to our PRC subsidiaries or future capital contributions by us to
our PRC subsidiaries. As a result, uncertainties exist as to our ability to provide prompt financial support to our PRC subsidiaries
when needed. If we fail to complete such registrations or obtain such approvals, our ability to use the proceeds we expect to receive
from the Business Combination and to capitalize or otherwise fund our PRC operations may be negatively affected, which could materially
and adversely affect our liquidity and our ability to fund and expand our business.

  13  

Governmental
control of currency conversion may limit our ability to utilize our income effectively and affect the value of your investment.

The
PRC government imposes controls on the convertibility of the Renminbi into foreign currencies and, in certain cases, the remittance of
currency out of China. We receive substantially all of our income in Renminbi. Under our current corporate structure, our British Virgin
Islands holding company may rely on dividend payments from our PRC subsidiaries to fund any cash and financing requirements payable outside
of China. Under existing PRC foreign exchange regulations, payments of current account items, including profit distributions, interest
payments and trade and service-related foreign exchange transactions, can be made in foreign currencies without prior approval of SAFE
by complying with certain procedural requirements. Specifically, under the existing exchange restrictions, cash generated from the operations
of our PRC subsidiaries in China may be used to pay dividends to our company without prior approval of SAFE. However, approval from or
registration with appropriate government authorities is required where Renminbi is to be converted into foreign currency and remitted
out of China to pay capital expenses such as the repayment of loans denominated in foreign currencies. As a result, we need to obtain
SAFE approval to use cash generated from the operations of our PRC subsidiaries to pay any debts they may incur in a currency other than
Renminbi owed to entities outside China, or to make other capital expenditure payments outside China in a currency other than Renminbi.

In
addition, the PRC government may also at its discretion to restrict our access in the future to foreign currencies for current account
transactions. If we are prevented from obtaining sufficient foreign currency to satisfy our foreign currency demands,