Company: LICN
Filing Date: 2025-01-29
Form Type: 424B5
Source: 0001213900-25-007741
Chunk: 27

Company: Lichen International Ltd
Filing Date: 2025-01-29
Form: 424B5
Chunk 27
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 ended December 31, 2020,
Lichen Zixun made dividend payments of RMB30 million (approximately $4.3 million) to the then eventual shareholders of Lichen Zixun, who
are PRC individuals. The Company made no such dividend, distribution or transfer during the fiscal year ended December 31, 2021. As of
the date of this prospectus supplement, the Company or its subsidiaries have made no other transfers, dividends, or distributions to investors
and no investors have made transfers, dividends, or distributions to the Company or its subsidiaries.

As of the date of this prospectus supplement,
no dividends, distributions or transfers has been made between Lichen China Limited and any of its subsidiaries. For the foreseeable future,
the Company intends to use the earnings for research and development, to develop new products and to expand its production capacity. As
a result, we do not expect to pay any cash dividends in the foreseeable future. Also, as of the date of this prospectus supplement,
no cash generated from one subsidiary is used to fund another subsidiary’s operations and we do not anticipate any difficulties
or limitations on our ability to transfer cash between subsidiaries.

PRC Regulations

In accordance with PRC regulations, a domestic company is required to maintain a surplus reserve of at least 10% of its annual after-tax profit until such reserve has reached 50% of its respective registered capital based on the enterprise’s PRC statutory accounts. The aforementioned reserves can only be used for specific purposes and may not be distributed as cash dividends. Lichen Zixun and Lichen Education were established as domestic companies; therefore, each is subject to the above-mentioned restrictions on distributable profits.

As a result of PRC laws and regulations that require annual appropriations of 10% of after-tax income to be set aside, prior to payment of dividends, in a general reserve fund, the Company’s PRC subsidiaries are restricted in their ability to transfer a portion of their net assets to the Company as a dividend or otherwise.

Regulatory Permissions

Our Subsidiaries currently have obtained all material
permissions and approvals required for our operations in compliance with the relevant PRC laws and regulations in the PRC, including the
business license and agency bookkeeping license. The business license is a permit issued by Market Supervision and Administration that
allows the company to conduct specific business within the government’s geographical jurisdiction. The agency bookkeeping license
is issued by the financial department to enterprises, allowing enterprises to accept entrusted bookkeeping