Company: ZDAN
Filing Date: 2025-06-30
Form Type: F-1
Source: 0001683168-25-004840
Chunk: 158

Company: Zerolimit Technology Holding Co. Ltd.
Filing Date: 2025-06-30
Form: F-1
Chunk 158
---
 to the Company in accordance with the agreed-upon terms. After the payment has been received from the distributors, software
products are delivered in accordance with the contractual obligations in the purchase agreements to the distributors through an activation
code. After delivery of the software product, the Company works together with distributors to provide after-sales support and maintenance
services. Revenue recognition policies for each type of revenue stream are as follow:

Software Perpetual License

The Company derives its
software perpetual license revenue by selling software perpetual license and providing related services based on customers’ order.
There are two performance obligations. Software license and related pre-installation debugging service is considered one performance
obligation. Usually the physical possession of the software is transferred to the Customers immediately upon the delivery of software
and the activation code. The activation codes are matched to debugged software only, so the debugging is not separable from the fulfillment
of software license. Post-contract consulting (PCS), technical support and upgrade services are collectively considered as another performance
obligation as these services are provided to customers on within 1 year of the transfer of software licenses. The transaction price is
predetermined according to the contract price. Generally, the credit term is within three months. There is no other obligation in our
contracts, such as return, refund or warranties. Software perpetual license and pre-installation debugging service revenue is recognized
when control of the software is transferred to the distributors (i.e., when our performance obligation is satisfied at a point in time),
which typically occurs immediately after delivery and installation is completed. Revenue derived from PCS service, technical support
service and upgrade service are recognized over the contract period as these services are provided over the contract period and the performance
obligation are satisfied over the contract period. Revenue derived from PCS service, technical support service and upgrade service are
not material.

| 91 |

Software Term License

The Company derives its
software term license revenue by authorizing software license and providing related technical support services within the contract period.
For customer contracts that contain license and technical support services that are not considered distinct, both the license and technical
support services are determined to be a single performance obligation and the revenue is recognized over time based upon the Company's
efforts to satisfy the performance obligation.

Standalone Selling Price Estimate

The company allocated the
contract price to both the software products and the service elements. The Company do not sell its installation service, post-contract
consulting and training service, technical support service and upgrade service separately