Company: ZDAN
Filing Date: 2025-06-30
Form Type: F-1
Source: 0001683168-25-004840
Chunk: 156

Company: Zerolimit Technology Holding Co. Ltd.
Filing Date: 2025-06-30
Form: F-1
Chunk 156
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| Total minimum lease payments |     | $ | 1,234,831 |

| 89 |

Contingencies

The Company may be involved
in various legal proceedings, claims and other disputes arising from the commercial operations, projects, employees and other matters
which, in general, are subject to uncertainties and in which the outcomes are not predictable. The Company determines whether an estimated
loss from a contingency should be accrued by assessing whether a loss is deemed probable and can be reasonably estimated. Although the
outcomes of these legal proceedings cannot be predicted, the Company does not believe these actions, in the aggregate, will have a material
adverse impact on its financial position, results of operations or liquidity.

Zhenglian Shenzhen has a
contract dispute with one of its previous suppliers, Shenzhen Youwei Communication Technology Co., Ltd. (“Youwei”).
Zhenglian Shenzhen sued Youwei on March 23, 2023 in connection with a cooperative purchasing agreement and a relevant supplementary agreement
(the “Youwei Purchase Agreements”) between Youwei and Zhenglian Shenzhen in Shenzhen Qianhai Cooperation Zone People’s
Court (“Qianhai Court”). Zhenglian Shenzhen claimed that Youwei failed to provide Zhenglian Shenzhen with the customized
mobile phones that meet the Zhenglian Shenzhen’s requirements in accordance with the Youwei Purchase Agreements. Zhenglian Shenzhen
has claimed total compensation of approximately $1.1 million. In June of 2023, Youwei filed a counterclaim against Zhenglian Shenzhen.
As of September 30, 2024, the case was still pending for the court’s judgement. We do not believe this legal proceeding will have
any material adverse effect on our operation in China. As of September 30, 2024, the Company was not aware of any other litigation or
lawsuits against it.

<div align='center'>Critical Accounting Policies</div>

We prepare our consolidated
financial statements in conformity with accounting principles generally accepted by the U.S. GAAP, which requires us to make judgments,
estimates and assumptions that affect our reported amount of assets, liabilities, revenue, costs and expenses, and any related disclosures.
Although there were no material changes made to the accounting estimates and assumptions in the past two years, we continually evaluate
these estimates and assumptions based on the most recently available information, our own historical experience and various other assumptions
that we believe to be reasonable under the circumstances. Since the use of