Company: ZDAN
Filing Date: 2025-01-10
Form Type: DRS/A
Source: 0001683168-25-000168
Chunk: 196

Company: Zerolimit Technology Holding Co. Ltd.
Filing Date: 2025-01-10
Form: DRS/A
Chunk 196
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ving the Examination of Authenticity and Compliance to Further Promote Foreign Exchange Control (“SAFE
Circular 3”), which stipulates several capital control measures with respect to the outbound remittance of profit from domestic
entities to offshore entities, including:

| · | under                                                                                      
 the principle of genuine transaction, banks shall check board resolutions regarding profit 
 distribution, the original version of tax filing records and audited financial statements; 
 and                                                                                        |
| · | domestic                                                                                   
 entities shall hold income to account for previous years’ losses before remitting the      
 profits.                                                                                   |

Moreover, pursuant to SAFE
Circular 3, domestic entities shall make detailed explanations of the sources of capital and utilization arrangements, and provide board
resolutions, contracts and other proof when completing the registration procedures in connection with an outbound investment.

| 123 |

Regulation of Dividend Distributions

The principal regulations
governing distribution of dividends of foreign-invested enterprises include the PRC Company Law, the Foreign Investment Law of the PRC,
and the Implementing Rules. Under these laws and regulations, foreign-invested enterprises in China may pay dividends only out of their
accumulated after-tax profits, if any, determined in accordance with PRC accounting standards and regulations.

In addition, enterprises
in China are required to allocate at least 10% of their respective accumulated profits each year, if any, to fund certain reserve funds
until these reserves have reached 50% of the registered capital of the enterprises. Companies may, at their discretion, allocate a portion
of their after-tax profits based on PRC accounting standards to staff welfare and bonus funds. These reserves are not distributable as
cash dividends.

Regulations on Foreign Exchange Registration of Overseas Investment by PRC Residents

SAFE promulgated the Circular
on Relevant Issues Relating to Domestic Resident’s Investment and Financing and Roundtrip Investment through Special Purpose Vehicles
(“SAFE Circular 37”), in July 2014. SAFE Circular 37 requires PRC residents or entities to register with SAFE or its local
branches in connection with their establishment or control of an offshore entity established for the purpose of overseas investment or
financing. In addition, such PRC residents or entities must update their SAFE registrations when the offshore special purpose vehicle
undergoes material events relating to any change of basic information (including change of such PRC citizens or residents, names and
operation terms), increases or decreases in investment amount, transfers or exchanges of shares, or mergers or divisions.

SAFE Circular