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Item 1A. Risk Factors

2026-03-31 compared with 2025-03-31 · 463 added, 1754 removed, 62 unchanged (97% of the section changed)

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You could lose all or a significant portion of your investment due to any of these risks and uncertainties.

is a summary of material risks, uncertainties and other factors that could have a material effect on the Company and its operations:

Our industry and the markets in which we operate are highly competitive and increased competitive pressures could reduce our share of the markets we serve and adversely affect our business, financial position, results of operations and cash flows;

We are a holding company and depend upon our subsidiary for our cash flows;

We may require additional funding for our growth plans, and such funding may result in a dilution of your investment;

As a controlled company during 2024, we were not subject to all of the corporate governance rules of Nasdaq Capital Market, and we continue to take advantage of Nasdaq’s phase-in rules for compliance with the majority independent board requirement;

The Company’s payment of cash dividends from additional paid-in capital may expose the Company to potential liabilities arising out of state and federal fraudulent conveyance laws and legal distribution requirements.

If the voting power of our capital stock continues to be highly concentrated, it may prevent you and other minority stockholders from influencing significant corporate decisions and may result in conflicts of interest;

Our common stock may be delisted under the Holding Foreign Companies Accountable Act if the PCAOB is unable to inspect our auditor given that they are relying upon support from their China-based offices, and the delisting of our common stock, or the threat of their being delisted, may materially and adversely affect the value of your investment;

We are dependent upon customer renewals, the addition of new customers, increased revenue from existing customers and the continued growth of the market for content management, customer experience management, task and process mining, and robotic process automation;

Our subscription renewal rates may decrease, and any decrease could harm our future revenue and operating results;

If we do not accurately predict subscription renewal rates or otherwise fail to forecast our revenue accurately, or if we fail to match our expenditures with corresponding revenue, our operating results could be adversely affected;

Because we generally recognize revenue from subscriptions ratably over the term of the agreement, near term changes in sales may not be reflected immediately in our operating results;

We face significant competition

from both established and new companies offering digital marketing, task and process mining, content management, customer experience

management, and robotic process automation, and other related applications, as well as internally developed software, which may harm

our ability to add new customers, retain existing customers and grow our business;

We have experienced rapid

growth and organizational change in recent periods and expect continued future growth.

If we fail to manage our growth effectively,

we may be unable to execute our business plan, maintain high levels of service or address competitive challenges adequately;

Failure to effectively

develop and expand our digital marketing, task and process mining, content management, customer experience management, and robotic

process automation capabilities could harm our ability to increase our customer base and achieve broader market acceptance of our

The rate of growth of our

business depends on the continued participation and level of service of our third-party partners;

We may experience quarterly

fluctuations in our operating results due to a number of factors, which makes our future results difficult to predict and could cause

our operating results to fall below expectations or our guidance;

If we fail to maintain

our inbound thought leadership position, our business may suffer;

If we fail to further enhance

our brand and maintain our existing strong brand awareness, our ability to expand our customer base will be impaired and our financial

condition may suffer;

If we fail to adapt and

respond effectively to rapidly changing technology, evolving industry standards and changing customer needs or requirements, our

software may become less competitive;

If we fail to offer high-quality

customer support, our business and reputation may suffer;

We may not be able to scale

our business quickly enough to meet our customers’ growing needs and if we are not able to grow efficiently, our operating

results could be harmed;

Our ability to introduce

new products and features is dependent on adequate research and development resources.

If we do not adequately fund our research

and development efforts, we may not be able to compete effectively and our business and operating results may be harmed;

Changes in the sizes or

types of businesses that purchase our software or in the applications within our software purchased or used by our customers could

negatively affect our operating results;

We have in the past completed

acquisitions and may acquire or invest in other companies or technologies in the future, which could divert management’s attention,

fail to meet our expectations, result in additional dilution to our stockholders, increase expenses, disrupt our operations or harm

our operating results;

Because our long-term growth

strategy involves further expansion of our sales to customers outside Japan, our business will be susceptible to risks associated

with international operations;

If we cannot maintain our

company culture as we grow, we could lose the innovation, teamwork, passion and focus on execution that we believe contribute to

our success and our business may be harmed;

We rely on our management

team and other key employees, and the loss of one or more key employees could harm our business;

The failure to attract

and retain additional qualified personnel could prevent us from executing our business strategy;

Interruptions or delays

in service from our third-party data center providers could impair our ability to deliver our software to our customers, resulting

in customer dissatisfaction, damage to our reputation, loss of customers, limited growth and reduction in revenue;

If our software has outages

or fails due to defects or similar problems, and if we fail to correct any defect or other software problems, we could lose customers,

become subject to service performance or warranty claims or incur significant costs;

We are dependent on the

continued availability of third-party data hosting and transmission services;

If we do not or cannot

maintain the compatibility of our software with third-party applications that our customers use in their businesses, our revenue

will decline;

We rely on data provided

by third parties, the loss of which could limit the functionality of our software and disrupt our business;

Privacy concerns and end

users’ acceptance of Internet behavior tracking may limit the applicability, use and adoption of our software;

If our or our customers’

security measures are compromised or unauthorized access to data of our customers or their customers is otherwise obtained, our software

may be perceived as not being secure, our customers may be harmed and may curtail or cease their use of our software, our reputation

may be damaged and we may incur significant liabilities;

Our business may suffer

if it is alleged or determined that our technology infringes the intellectual property rights of others;

If we fail to adequately

protect our proprietary rights, in Japan and abroad, our competitive position could be impaired and we may lose valuable assets,

experience reduced revenue and incur costly litigation to protect our rights;

Our use of “open-source”

software could negatively affect our ability to offer our software and subject us to possible litigation;

We are subject to governmental

regulation and other legal obligations, particularly related to privacy, data protection and information security, and our actual

or perceived failure to comply with such obligations could harm our business.

Compliance with such laws could also impair our efforts

to maintain and expand our customer base, and thereby decrease our revenue;

The standards that private

entities use to regulate the use of email have in the past interfered with, and may in the future interfere with, the effectiveness

of our software and our ability to conduct business;

Existing federal, state

and foreign laws regulate Internet tracking software, the senders of commercial emails and text messages, website owners and other

activities, and could impact the use of our software and potentially subject us to regulatory enforcement or private litigation;

We are subject to governmental

export controls and economic sanctions laws that could impair our ability to compete in international markets and subject us to liability

if we are not in full compliance with applicable laws;

Our substantial indebtedness

could have important adverse consequences and adversely affect our financial condition;

We may be unable to generate

sufficient cash flow to satisfy our significant debt service obligations, which could have a material adverse effect on our business,

financial condition and results of operations;

Despite our level of indebtedness,

we and our subsidiary may still be able to incur substantially more debt, including off-balance sheet financing, contractual obligations

and general and commercial liabilities.

This could further exacerbate the risks to our financial condition described above;

There can be no assurance

that we will be able to comply with Nasdaq Capital Market’s continued listing standards.

On March 12, 2023, Signature

Bank was closed by its state chartering authority, the New York State Department of Financial Services.

On the same date the Federal

Deposit Insurance Corporation (“FDIC”) was appointed as receiver and transferred all customer deposits and substantially

all of the assets of Signature Bank to Signature Bridge Bank, N.A., a full-service bank that is being operated by the FDIC.

automatically became a customer of Signature Bridge Bank, N.A.

as part of this action.

The Company held approximately $4.7 million

cash deposits at Signature Bridge Bank, N.A.

as of March 12, 2023.

Normal banking activities resumed on Monday, March 13, 2023.

Related to Our Business and Strategy

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to participate in such an additional round of fund raising may suffer dilution in their investment.

a controlled company during 2024, we were not subject to all of the corporate governance rules of Nasdaq Capital Market, and we continue

to take advantage of Nasdaq’s phase-in rules for compliance with the majority independent board requirement.

“controlled company” exception to Nasdaq Capital Market rules provides that a company of which more than 50% of the voting

power is held by an individual, group or another company, a “controlled company,” need not comply with certain requirements

of Nasdaq Capital Market corporate governance rules.

During the year ended December 31, 2024, Sumitaka Yamamoto, our Chief Executive

Officer and Chairman of the Board, beneficially owned a majority of the voting power of our outstanding common stock.

As a “controlled

company” within the meaning of the corporate governance rules of Nasdaq Capital Market, during 2024, we were exempt from Nasdaq

Capital Market’s corporate governance rules requiring that listed companies have (i) a majority of the board of directors consist

of “independent” directors under the listing standards of Nasdaq Capital Market, (ii) a nominating/corporate governance committee

composed entirely of independent directors and a written nominating/corporate governance committee charter meeting the requirements of

Nasdaq Capital Market, and (iii) a compensation committee composed entirely of independent directors and a written compensation committee

charter meeting the requirements of Nasdaq Capital Market.

We no longer qualify as a controlled company and accordingly, on February

14, 2025, we formed a compensation committee and a nominating and corporate governance committee;

however, we currently utilize and presently

intend to continue to utilize the exemption relating to a majority independent board.

Accordingly, you may not have the same protections

afforded to stockholders of companies that are subject to all of the corporate governance requirements of Nasdaq Capital Market.

to Nasdaq’s phase-in rules, we have a period of one year from the date on which we ceased to be a controlled company to comply

with the majority independent board.

The Company’s payment of cash dividends

from additional paid-in capital may expose the Company to potential liabilities arising out of state and federal fraudulent conveyance

laws and legal distribution requirements.

In the past, the Company has

paid cash dividends, and the Company may continue to issue quarterly dividends going forward, contingent upon the Board of Directors’

approval, following review of the Company’s then-current financial results.

Although the Company believed that it would be adequately

capitalized following payment of each of its cash dividends, the Company’s payment of cash dividends could be challenged under various

state and federal fraudulent conveyance laws.

Fraudulent conveyances or transfers are generally defined to include transfers made or obligations

incurred with the actual intent to hinder, delay or defraud current or future creditors or transfers made or obligations incurred for

less than reasonably equivalent value when the debtor was insolvent, or that rendered the debtor insolvent, inadequately capitalized or

unable to pay its debts as they become due.

Any unpaid creditor could claim that any one or the aggregate of the cash dividends left the

Company insolvent or with unreasonably small capital or that the Company intended or believed the Company would incur debts beyond the

Company’s ability to pay such debts as they mature.

If a court were to agree with such a plaintiff, then such court could void the

distributions as a fraudulent transfer or impose substantial liabilities on it, which could adversely affect the Company’s financial

condition and the Company’s results of operations.

The payment of cash dividends

is also subject to review under state corporate distribution statutes.

Under the Delaware General Corporation Law, a corporation may only

pay dividends to its stockholders either (i) out of its surplus (net assets minus capital) or (ii) if there is no such surplus, out of

its net profits for the fiscal year in which the dividend is declared and/or the preceding fiscal year.

Although the Company’s Board

of Directors made the distributions out of its surplus, there can be no assurance that a court will not later determine that some or all

of the distributions were unlawful.

common stock may be delisted under the Holding Foreign Companies Accountable Act if the PCAOB is unable to inspect our auditor given

that they are relying upon support from their China-based offices, and the delisting of our common stock, or the threat of their being

delisted, may materially and adversely affect the value of your investment.

Holding Foreign Companies Accountable Act, or the HFCA Act, was enacted on December 18, 2020.

The HFCA Act states if the SEC determines

that we have filed audit reports issued by a registered public accounting firm that has not been subject to inspection by the PCAOB for

three consecutive years beginning in 2021, the SEC shall prohibit our shares of common stock from being traded on a national securities

exchange or in the over the counter trading market in the United States.

March 24, 2021, the SEC adopted interim final rules relating to the implementation of certain disclosure and documentation requirements

of the HFCA Act.

On December 2, 2021, the SEC adopted amendments to finalize such rules.

We will be required to comply with these rules

if the SEC identifies us as having a “non-inspection” year by evaluating the annual report we file, in which we will identify

the auditor who provide opinions related to the financial statements presented in our annual report, the location where the auditor’s

report has been issued and the PCAOB ID number of such audit firm or branch.

If we have three consecutive non-inspection years, the SEC

will implement the trading prohibition of our common stock through stop orders, and the exact timeline for when the SEC will delist an

issuer after three consecutive non-inspection years remain imprecise.

On June 22, 2021, the United States Senate passed the Accelerating

Holding Foreign Companies Accountable Act (the “AHFCAA”), which, if enacted, would decrease the number of non-inspection

years from three years to two, thus reducing the time period before our common stock may be prohibited from trading or delisted.

29, 2022, the AHFCAA was signed into law.

August 26, 2022, the PCAOB announced and signed a Statement of Protocol (the “Protocol”) with the China Securities Regulatory

Commission and the Ministry of Finance of the People’s Republic of China (together, the “PRC Authorities”).

provides the PCAOB with:

(1) sole discretion to select the firms, audit engagements and potential violations it inspects and investigates,

without any involvement of Chinese authorities;

(2) procedures for PCAOB inspectors and investigators to view complete audit work papers

with all information included and for the PCAOB to retain information as needed;

(3) direct access to interview and take testimony from

all personnel associated with the audits the PCAOB inspects or investigates.

December 15, 2022, the PCAOB announced in its 2022 HFCA Act Determination Report (the “2022 Report”) its determination that

the PCAOB was able to secure complete access to inspect and investigate audit firms in the People’s Republic of China (PRC), and

the PCAOB Board voted to vacate previous determinations to the contrary.

According to the 2022 Report, this determination was reached

after the PCAOB had thoroughly tested compliance with every aspect of the Protocol necessary to determine complete access, including

on-site inspections and investigations in a manner fully consistent with the PCAOB’s methodology and approach in the U.S.

and globally.

According to the 2022 Report, the PRC Authorities had fully assisted and cooperated with the PCAOB in carrying out the inspections and

investigations according to the Protocol, and have agreed to continue to assist the PCAOB’s investigations and inspections in the

The PCAOB may reassess its determinations and issue new determinations consistent with the HFCAA at any time.

Our financial statements contained

in this Annual Report on Form 10-K have been audited by MaloneBailey, LLP, an independent registered public accounting firm that is headquartered

in the United States with offices in Beijing and Shenzhen, China, and Tokyo, Japan.

MaloneBailey, LLP is not among the PCAOB-registered

public accounting firms headquartered in the PRC or Hong Kong that are subject to PCAOB’s determination on December 16, 2021 of

having been unable to inspect or investigate completely.

As of the date of this annual report, we have not been identified by the SEC

as a commission-identified issuer under the HFCA Act.

are dependent upon customer renewals, the addition of new customers, increased revenue from existing customers and the continued growth

of the market for content management, customer experience management, task and process mining, and robotic process automation.

derive, and expect to continue to derive, a substantial portion of our revenue from the sale of subscriptions to use our software for

digital marketing, task and process mining, content management, customer experience management, and robotic process animation.

for digital marketing, task and process mining, content management, customer experience management, and robotic process animation is

still evolving, and competitive dynamics may cause pricing levels to change as the market matures and as existing and new market participants

introduce new types of point applications and different approaches to enable businesses to address their respective needs.

we may be forced to reduce the prices we charge for our software and may be unable to renew existing customer agreements or enter into

new customer agreements at the same prices and upon the same terms that we have historically.

In addition, our growth strategy involves

a scalable pricing model intended to provide us with an opportunity to increase the value of our customer relationships over time as

we expand their use of our software, sell to other parts of their organizations, cross-sell our sales products to existing marketing

product customers and vice versa through touchless or low touch in product purchases, and upsell additional offerings and features.

our cross-selling efforts are unsuccessful or if our existing customers do not expand their use of our software or adopt additional offerings

and features, our operating results may suffer.

subscription renewal rates may decrease, and any decrease could harm our future revenue and operating results.

customers have no obligation to renew their subscriptions for our software after the expiration of their subscription periods, substantially

all of which are one year or less.

In addition, our customers may seek to renew for lower subscription tiers, for fewer contacts or seats,

or for shorter contract lengths.

Also, customers may choose not to renew their subscriptions for a variety of reasons.

Our renewal rates

may decline or fluctuate as a result of a number of factors, including limited customer resources, pricing changes, the prices of services

offered by our competitors, adoption and utilization of our services and add-on applications by our customers, adoption of our new software,

customer satisfaction with our services, mergers and acquisitions affecting our customer base, reductions in our customers’ spending

levels or declines in customer activity as a result of economic downturns or uncertainty in financial markets.

If our customers do not

renew their subscriptions for our software or decrease the amount they spend with us, our revenue will decline and our business will

In addition, a subscription model creates certain risks related to the timing of revenue recognition and potential reductions

in cash flows.

A portion of the subscription-based revenue we report each quarter results from the recognition of deferred revenue relating

to subscription agreements entered into during previous quarters.

A decline in new or renewed subscriptions in any period may not be

immediately reflected in our reported financial results for that period, but may result in a decline in our revenue in future quarters.

If we were to experience significant downturns in subscription sales and renewal rates, our reported financial results might not reflect

such downturns until future periods.

we do not accurately predict subscription renewal rates or otherwise fail to forecast our revenue accurately, or if we fail to match

our expenditures with corresponding revenue, our operating results could be adversely affected.

our recent growth has resulted in the rapid expansion of our business, we do not have a long history upon which to base forecasts of

renewal rates with customers or future operating revenue.

As a result, our operating results in future reporting periods may be significantly

below the expectations of the public market, equity research analysts or investors, which could harm the price of our common stock.

we generally recognize revenue from subscriptions ratably over the term of the agreement, near term changes in sales may not be reflected

immediately in our operating results.

offer our software primarily through a mix of monthly, quarterly and single-year subscription agreements, which are generally paid upfront

and some are with ratable revenue recognition over the subscription period.

As a result, some of the revenue we report in each quarter

is derived from agreements entered into during prior months, quarters or years.

In addition, we do not record deferred revenue beyond

amounts invoiced as a liability on our balance sheet.

A decline in new or renewed subscriptions or marketing solutions agreements in

any one quarter is not likely to be reflected immediately in our revenue results for that quarter.

Such declines, however, would negatively

affect our revenue and deferred revenue balances in future periods, and the effect of significant downturns in sales and market acceptance

of our software, and potential changes in our rate of renewals, may not be fully reflected in our results of operations until future

Our subscription model also makes it difficult for us to rapidly increase our total revenue and deferred revenue balance through

additional sales in any period, as revenue from new customers must be recognized over the applicable subscription term.

face significant competition from both established and new companies offering digital marketing, task and process mining, content management,

customer experience management, and robotic process automation, and other related applications, as well as internally developed software,

which may harm our ability to add new customers, retain existing customers and grow our business.

digital marketing, task and process mining, content management, customer experience management, and robotic process automation market

is evolving, highly competitive and significantly fragmented.

With the introduction of new technologies and the potential entry of new

competitors into the market, we expect competition to persist and intensify in the future, which could harm our ability to increase sales,

maintain or increase renewals and maintain our prices.

face intense competition from other companies that develop software for digital marketing, task and process mining, content management,

customer experience management, and robotic process automation and from marketing services companies that provide interactive marketing

Competition could significantly impede our ability to sell subscriptions to use our software on terms favorable to us.

current and potential competitors may develop and market new technologies that render our existing or future products less competitive,

In addition, if these competitors develop software with similar or superior functionality to our software, we may need to

decrease the prices or accept less favorable terms for our software subscriptions in order to remain competitive.

If we are unable to

maintain our pricing due to competitive pressures, our margins will be reduced and our operating results will be negatively affected.

competitors include:

task and process mining vendors;

email marketing software vendors;

content management system providers;

customer experience management system\ providers;

robotic process automation vendors;

cloud-based marketing automation providers;

large-scale enterprise suites;

customer service software providers;

Customer experience management systems.

addition, instead of using our software, some prospective customers may elect to combine disparate point applications, such as content

management, marketing automation, analytics and social media management.

We expect that new competitors, such as enterprise software

vendors that have traditionally focused on enterprise resource planning or other applications supporting back office functions, will

develop and introduce applications serving customer-facing and other front office functions.

This development could have an adverse effect

on our business, operating results and financial condition.

In addition, sales force automation and contact relationship management vendors

could acquire or develop applications that compete with our marketing software offerings.

Some of these companies have acquired social

media marketing and other marketing software providers to integrate with their broader offerings.

current and potential competitors may have significantly more financial, technical, marketing and other resources than we have, be able

to devote greater resources to the development, promotion, sale and support of their products and services, may have more extensive customer

bases and broader customer relationships than we have, and may have longer operating histories and greater name recognition than we have.

As a result, these competitors may respond faster to new technologies and undertake more extensive marketing campaigns for their products.

In a few cases, these vendors may also be able to offer marketing, sales, customer service and content management software at little

or no additional cost by bundling it with their existing suite of applications.

To the extent any of our competitors has existing relationships

with potential customers for either marketing software or other applications, those customers may be unwilling to purchase our software

because of their existing relationships with our competitor.

If we are unable to compete with such companies, the demand for our software

could substantially decline.

addition, if one or more of our competitors were to merge or partner with another of our competitors, our ability to compete effectively

could be adversely affected.

Our competitors may also establish or strengthen cooperative relationships with our current or future strategic

distribution and technology partners or other parties with whom we have relationships, thereby limiting our ability to promote and implement

our software.

We may not be able to compete successfully against current or future competitors, and competitive pressures may harm our

business, operating results and financial condition.

We expect continued future growth and if

we fail to manage our growth effectively, we may be unable to execute our business plan, maintain high levels of service or address competitive

challenges adequately.

Our head count and operations

We plan to open international offices in the future.

This growth has placed, and will continue to place, a significant strain

on our management, administrative, operational and financial infrastructure.

We anticipate further growth will be required to address

increases in our product offerings and continued expansion.

Our success will depend in part upon our ability to recruit, hire, train,

manage and integrate a significant number of qualified managers, technical personnel and employees in specialized roles within our company,

including in technology, sales and marketing.

Furthermore, preservation of our corporate culture has been made more difficult as our work

force has been working from home in connection with restrictions placed upon businesses due to the pandemic.

A long-term continuation

of these restrictions could, among other things, negatively impact employee morale and productivity.

Any failure to preserve our culture

could harm our future success, including our ability to retain and recruit personnel, innovate and operate effectively and execute on

our business strategy.

Furthermore, as our employees work remotely from geographic areas across the globe and more of our employees work

remotely on a permanent basis due to the pandemic, we may need to reallocate our investment of resources and closely monitor a variety

of local regulations and requirements, including local tax laws, and we may experience unpredictability in our expenses and employee work

If we experience any of these effects in connection with future growth, if our new employees perform poorly, or if we are unsuccessful

in recruiting, hiring, training, managing and integrating these new employees, or retaining these or our existing employees, it could

materially impair our ability to attract new customers, retain existing customers and expand their use of our software, all of which would

materially and adversely affect our business, financial condition and results of operations.

In addition, to manage the

expected continued growth of our head count, operations and geographic expansion, we will need to continue to improve our information

technology infrastructure, operational, financial and management systems and procedures.

Our anticipated additional head count and capital

investments will increase our costs, which will make it more difficult for us to address any future revenue shortfalls by reducing expenses

in the short term.

If we fail to successfully manage our growth, we will be unable to successfully execute our business plan, which could

have a negative impact on our business, results of operations or financial condition.

Failure to effectively develop and expand

our digital marketing, task and process mining, content management, customer experience management, and robotic process automation capabilities

could harm our ability to increase our customer base and achieve broader market acceptance of our software.

To increase total customers

and achieve broader market acceptance of our software, we will need to expand our digital marketing, task and process mining, content

management, customer experience management, and robotic process automation operations, including our sales force and third-party channel

We will continue to dedicate significant resources to inbound sales and marketing programs.

The effectiveness of our inbound

sales and marketing and third-party channel partners has varied over time and may vary in the future and depends on our ability to maintain

and improve our digital marketing, task and process mining, content management, customer experience management, and robotic process automation

capabilities.

All of these efforts will require us to invest significant financial and other resources.

Our business will be seriously

harmed if our efforts do not generate a correspondingly significant increase in revenue.

We may not achieve anticipated revenue growth

from expanding our sales force if we are unable to hire, develop and retain talented sales personnel, if our new sales personnel are unable

to achieve desired productivity levels in a reasonable period of time or if our sales and marketing programs are not effective.

The rate of growth of our business depends

on the continued participation and level of service of our third-party partners.

We rely on our task and process

mining third-party partners to provide certain services to our customers, as well as pursue sales of our software to customers.

extent we do not attract new partners, or existing or new partners do not refer a growing number of customers to us, our revenue and operating

results would be harmed.

In addition, if our partners do not continue to provide services to our customers, we would be required to provide

such services ourselves either by expanding our internal team or engaging other third-party providers, which would increase our operating

We may experience quarterly fluctuations

in our operating results due to a number of factors, which makes our future results difficult to predict and could cause our operating

results to fall below expectations or our guidance.

Our quarterly operating results

have fluctuated in the past and are expected to fluctuate in the future due to a variety of factors, many of which are outside of our

As a result, our past results may not be indicative of our future performance, and comparing our operating results on a period-to-period

basis may not be meaningful.

In addition to the other risks described in this Annual Report on Form 10-K, factors that may affect our

quarterly operating results include the following:

changes in spending on marketing, task and process mining, content management, customer experience management, and robotic process automation software by our current or prospective customers;

pricing our software subscriptions effectively so that we are able to attract and retain customers without compromising our profitability;

attracting new customers for our marketing, sales, customer service, and content management software, increasing our existing customers’ use of our software and providing our customers with excellent customer support;

customer renewal rates and the amounts for which agreements are renewed;

global awareness of our thought leadership and brand;

changes in the competitive dynamics of our market, including consolidation among competitors or customers and the introduction of new products or product enhancements;

changes to the commission plans, quotas and other compensation-related metrics for our sales representatives;

the amount and timing of payment for operating expenses, particularly research and development, sales and marketing expenses and employee benefit expenses;

the amount and timing of costs associated with recruiting, training and integrating new employees while maintaining our company culture;

our ability to manage our existing business and future growth, including increases in the number of customers on our software and the introduction and adoption of our software in new markets outside of the United States;

unforeseen costs and expenses related to the expansion of our business, operations and infrastructure, including disruptions in our hosting network infrastructure and privacy and data security;

foreign currency exchange rate fluctuations;

general economic and political conditions in our domestic and international markets.

We may not be able to accurately

forecast the amount and mix of future subscriptions, revenue and expenses and, as a result, our operating results may fall below our estimates

or the expectations of public market analysts and investors.

If our revenue or operating results fall below the expectations of investors

or securities analysts, or below any guidance we may provide, the price of our common stock could decline.

If we fail to maintain our inbound thought

leadership position, our business may suffer.

We believe that maintaining

our thought leadership position in inbound digital marketing, content management, customer experience management, and robotic process

automation, is an important element in attracting new customers.

We devote significant resources to develop and maintain our thought leadership

position, with a focus on identifying and interpreting emerging trends in the inbound experience, shaping and guiding industry dialog

and creating and sharing the best inbound practices.

Our activities related to developing and maintaining our thought leadership may not

yield increased revenue, and even if they do, any increased revenue may not offset the expenses we incurred in such effort.

the continued services of our management and employees with domain expertise with inbound digital marketing, content management, customer

experience management, and robotic process automation, and the loss of any key employees in this area could harm our competitive position

and reputation.

If we fail to successfully grow and maintain our thought leadership position, we may not attract enough new customers

or retain our existing customers, and our business could suffer.

If we fail to further enhance our brand

and maintain our existing strong brand awareness, our ability to expand our customer base will be impaired and our financial condition

We believe that our development

of the HeartCore brand is critical to achieving widespread awareness of our existing and future inbound and automation experience solutions,

and, as a result, is important to attracting new customers and maintaining existing customers.

In the past, our efforts to build our brand

have involved significant expenses, and we believe that this investment has resulted in strong brand recognition.

Successful promotion

and maintenance of our brands will depend largely on the effectiveness of our marketing efforts and on our ability to provide a reliable

and useful software at competitive prices.

Brand promotion activities may not yield increased revenue, and even if they do, any increased

revenue may not offset the expenses we incurred in building our brand.

If we fail to successfully promote and maintain our brand, our

business could suffer.

If we fail to adapt and respond effectively

to rapidly changing technology, evolving industry standards and changing customer needs or requirements, our software may become less

Our future success depends

on our ability to adapt and innovate our software.

To attract new customers and increase revenue from existing customers, we need to continue

to enhance and improve our offerings to meet customer needs at prices that our customers are willing to pay.

Such efforts will require

adding new functionality and responding to technological advancements, which will increase our research and development costs.

unable to develop new applications that address our customers’ needs, or to enhance and improve our software in a timely manner,

we may not be able to maintain or increase market acceptance of our software.

Our ability to grow is also subject to the risk of future

disruptive technologies.

If we fail to offer high-quality customer

support, our business and reputation may suffer.

High-quality education, training

and customer support are important for the successful marketing, sale and use of our software and for the renewal of existing customers.

Providing this education, training and support requires that our personnel who manage our online training or provide customer support

have specific inbound experience domain knowledge and expertise, making it more difficult for us to hire qualified personnel and to scale

up our support operations.

The importance of high-quality customer support will increase as we expand our business and pursue new customers.

If we do not help our customers use multiple applications within our software and provide effective ongoing support, our ability to sell

additional functionality and services to, or to retain, existing customers may suffer and our reputation with existing or potential customers

may be harmed.

We may not be able to scale our business

quickly enough to meet our customers’ growing needs and if we are not able to grow efficiently, our operating results could be harmed.

As usage of our software grows

and as customers use our software for additional inbound applications, we will need to devote additional resources to improving our application

architecture, integrating with third-party systems and maintaining infrastructure performance.

In addition, we will need to appropriately

scale our internal business systems and our services organization, including customer support and professional services, to serve our

growing customer base, particularly as our customer demographics change over time.

Any failure of or delay in these efforts could cause

impaired system performance and reduced customer satisfaction.

These issues could reduce the attractiveness of our software to customers,

resulting in decreased sales to new customers, lower renewal rates by existing customers, the issuance of service credits, or requested

refunds, which could impede our revenue growth and harm our reputation.

Even if we are able to upgrade our systems and expand our staff,

any such expansion will be expensive and complex, requiring management’s time and attention.

We could also face inefficiencies or

operational failures as a result of our efforts to scale our infrastructure.

Moreover, there are inherent risks associated with upgrading,

improving and expanding our information technology systems.

We cannot be sure that the expansion and improvements to our infrastructure

and systems will be fully or effectively implemented on a timely basis, if at all.

These efforts may reduce revenue and our margins and

adversely affect our financial results.

Our ability to introduce new products and

features is dependent on adequate research and development resources.

If we do not adequately fund our research and development efforts,

we may not be able to compete effectively and our business and operating results may be harmed.

To remain competitive, we

must continue to develop new product offerings, applications, features and enhancements to our existing software.

Maintaining adequate

research and development personnel and resources to meet the demands of the market is essential.

If we are unable to develop our software

internally due to certain constraints, such as high employee turnover, lack of management ability or a lack of other research and development

resources, we may miss market opportunities.

Further, many of our competitors expend a considerably greater amount of funds on their research

and development programs, and those that do not may be acquired by larger companies that would allocate greater resources to our competitors’

research and development programs.

Our failure to maintain adequate research and development resources or to compete effectively with

the research and development programs of our competitors could materially adversely affect our business.

Changes in the sizes or types of businesses

that purchase our software or in the applications within our software purchased or used by our customers could negatively affect our operating

Our strategy is to sell subscriptions

to our software to mid to enterprise-sized businesses, but we have sold and will continue to sell to organizations ranging from small

businesses to enterprises.

Our gross margins can vary depending on numerous factors related to the implementation and use of our software,

including the sophistication and intensity of our customers’ use of our software and the level of professional services and support

required by a customer.

Sales to enterprise customers may entail longer sales cycles and more significant selling efforts.

small businesses may involve greater credit risk and uncertainty.

If there are changes in the mix of businesses that purchase our software

or the mix of the product plans purchased by our customers, our gross margins could decrease and our operating results could be adversely

We may acquire or invest in other companies

or technologies in the future, which could divert management’s attention, fail to meet our expectations, result in additional dilution

to our stockholders, increase expenses, disrupt our operations or harm our operating results.

We may in the future acquire

or invest in, businesses, products or technologies that we believe could complement or expand our software, enhance our technical capabilities

or otherwise offer growth opportunities.

We may not be able to fully realize the anticipated benefits of these or any future acquisitions.

The pursuit of potential acquisitions may divert the attention of management and cause us to incur various expenses related to identifying,

investigating and pursuing suitable acquisitions, whether or not they are consummated.

There are inherent risks in

integrating and managing acquisitions.

If we acquire additional businesses, we may not be able to assimilate or integrate the acquired

personnel, operations and technologies successfully or effectively manage the combined business following the acquisition and our management

may be distracted from operating our business.

We also may not achieve the anticipated benefits from the acquired business due to a number

of factors, including:

unanticipated costs or liabilities associated with the acquisition;

incurrence of acquisition-related costs, which

would be recognized as a current period expense;

inability to generate sufficient revenue to offset acquisition or investment costs;

inability to maintain relationships with customers and partners of the acquired business;

the difficulty of incorporating acquired technology

and rights into our software and of maintaining quality and security standards consistent with our brand;

delays in customer purchases

due to uncertainty related to any acquisition;

the need to integrate or implement additional controls, procedures and policies;

caused by distance, language and cultural differences;

harm to our existing business relationships with business partners and customers

as a result of the acquisition;

the potential loss of key employees;

use of resources that are needed in other parts of our business and

diversion of management and employee resources;

the inability to recognize acquired deferred revenue in accordance with our revenue recognition

and use of substantial portions of our available cash or the incurrence of debt to consummate the acquisition.

also increase the risk of unforeseen legal liability, including for potential violations of applicable law or industry rules and regulations,

arising from prior or ongoing acts or omissions by the acquired businesses which are not discovered by due diligence during the acquisition

Generally, if an acquired business fails to meet our expectations, our operating results, business and financial condition may

Acquisitions could also result in dilutive issuances of equity securities or the incurrence of debt, which could adversely affect

our business, results of operations or financial condition.

In addition, a significant

portion of the purchase price of companies we acquire may be allocated to goodwill and other intangible asset, which must be assessed

for impairment at least annually.

If our acquisitions do not ultimately yield expected returns, we may be required to make charges to

our operating results based on our impairment assessment process, which could harm our results of operations.

Because our long-term growth strategy involves

further expansion of our sales to customers outside Japan, our business will be susceptible to risks associated with international operations.

A component of our growth

strategy involves the further expansion of our operations and customer base worldwide.

We plan to open international offices in the future.

These international offices will focus primarily on sales, professional services and support.

Our future international operations and

future initiatives will involve a variety of risks, including:

difficulties in maintaining our company culture with a dispersed and distant workforce;

more stringent regulations relating to data security and the unauthorized use of, or access to, commercial and personal information;

the timing of our sales with our international clients and related revenue recognition is difficult to predict because of the length and unpredictability of the sales cycle for these clients;

unexpected changes in regulatory requirements, taxes or trade laws;

differing labor regulations where labor laws are generally more advantageous to employees as compared to Japan, including deemed hourly wage and overtime regulations in these locations;

challenges inherent in efficiently managing an increased number of employees, including remote employees, over large geographic distances, including the need to implement appropriate systems, policies, benefits and compliance programs;

difficulties in managing a business in new markets with diverse cultures, languages, customs, legal systems, alternative dispute systems and regulatory systems;

currency exchange rate fluctuations and the resulting effect on our revenue and expenses, and the cost and risk of entering into hedging transactions if we chose to do so in the future;

global economic uncertainty caused by global political events;

limitations on our ability to reinvest earnings from operations in one country to fund the capital needs of our operations in other countries;

limited or insufficient intellectual property protection;

political instability or terrorist activities;

likelihood of potential or actual violations of domestic and international anticorruption laws, such as the U.S.

Foreign Corrupt Practices Act and the U.K.

Bribery Act, or of U.S.

and international export control and sanctions regulations, which likelihood may increase with an increase of sales or operations in foreign jurisdictions and operations in certain industries;

adverse tax burdens and foreign exchange controls that could make it difficult to repatriate earnings and cash.

Our inexperience in operating

our business internationally increases the risk that any potential future expansion efforts that we may undertake will not be successful.

If we invest substantial time and resources to establish our international operations and are unable to do so successfully and in a timely

manner, our business and operating results will suffer.

We continue to implement policies and procedures to facilitate our compliance

laws and regulations applicable to or arising from our international business.

Inadequacies in our past or current compliance

practices may increase the risk of inadvertent violations of such laws and regulations, which could lead to financial and other penalties

that could damage our reputation and impose costs on us.

Our customers may fail to pay us in accordance

with the terms of their agreements, at times necessitating action by us to attempt to compel payment.

If our customers fail to pay

us in accordance with the terms of our agreements, we may be adversely affected both from the inability to collect amounts due and the

cost of enforcing the terms of our agreements, including litigation and arbitration costs.

The risk of these issues increases with the

term length of our customer arrangements.

Furthermore, some of our customers may seek bankruptcy protection or other similar relief and

fail to pay amounts due to us, or pay those amounts more slowly, either of which could adversely affect our results of operations, financial

condition and cash flow.

We believe our success depends on continuing

to invest in the growth of our worldwide operations by entering new geographic markets.

If our investments in these markets are greater

than anticipated, or if our customer growth or sales in these markets do not meet our expectations, our results of operations and financial

condition may be adversely affected.

We believe our success depends

on expanding our business into new geographic markets and attracting customers in countries other than the United States.

We anticipate

continuing to expand our operations worldwide and have made, and will continue to make, substantial investments and incur substantial

costs as we enter new geographic markets.

This includes investments in facilities, information technology investments, sales, marketing

and administrative personnel and facilities.

Often we must make these investments when it is still unclear whether future sales in the

new market will justify the costs of these investments.

In addition, these investments may be more expensive than we initially anticipate.

If our investments are greater than we initially anticipate or if our customer growth or sales in these markets do not meet our expectations

or justify the cost of the initial investments, our results of operations and financial condition may be adverse affected.

Risks Related to Our GO IPO Consulting Services

We provide consulting services and ultimately

do not control our client’s abilities to go public in the United States or secure a listing on American stock exchanges.

Company’s payment of cash dividends from additional paid-in capital may expose the Company to potential liabilities arising out

of state and federal fraudulent conveyance laws and legal distribution requirements.

the past, the Company has paid cash dividends, and the Company may continue to issue quarterly dividends going forward, contingent upon

the Board of Directors’ approval, following review of the Company’s then-current financial results.

Although the Company

believed that it would be adequately capitalized following payment of each of its cash dividends, the Company’s payment of cash

dividends could be challenged under various state and federal fraudulent conveyance laws.

Fraudulent conveyances or transfers are generally

defined to include transfers made or obligations incurred with the actual intent to hinder, delay or defraud current or future creditors

or transfers made or obligations incurred for less than reasonably equivalent value when the debtor was insolvent, or that rendered the

debtor insolvent, inadequately capitalized or unable to pay its debts as they become due.

Any unpaid creditor could claim that any one

or the aggregate of the cash dividends left the Company insolvent or with unreasonably small capital or that the Company intended or

believed the Company would incur debts beyond the Company’s ability to pay such debts as they mature.

If a court were to agree

with such a plaintiff, then such court could void the distributions as a fraudulent transfer or impose substantial liabilities on it,

which could adversely affect the Company’s financial condition and the Company’s results of operations.

payment of cash dividends is also subject to review under state corporate distribution statutes.

Under the Delaware General Corporation

Law, a corporation may only pay dividends to its stockholders either (i) out of its surplus (net assets minus capital) or (ii) if there

is no such surplus, out of its net profits for the fiscal year in which the dividend is declared and/or the preceding fiscal year.

the Company’s Board of Directors made the distributions out of its surplus, there can be no assurance that a court will not later

determine that some or all of the distributions were unlawful.

may experience significant quarterly fluctuations in our operating results due to our specialized business model and reliance on a limited

number of consulting agreements, which makes our future results difficult to predict.

quarterly operating results have fluctuated in the past and are expected to fluctuate significantly in the future.

As a result of the

shift in our business model, our past results may not be indicative of our future performance, and comparing our operating results on

a period-to-period basis may not be meaningful.

Unlike companies with recurring subscription revenue, our current business is almost

entirely dependent on providing Go IPO consulting services to a specific niche of private Japanese issuers.

As a result, our revenue

in any given period is highly dependent on the number of new consulting agreements we execute and the progress of our existing clients

through the IPO pipeline.

factors that may cause our quarterly operating results to fluctuate include:

Timing and Concentration of Agreements:

is driven by a limited number of high-value consulting agreements.

The failure to enter into anticipated agreements in a particular quarter,

or a delay in a client’s IPO timeline, can cause significant revenue shortfalls.

Volatility of Equity-Based Compensation:

A substantial

portion of our compensation consists of warrants or stock acquisition rights.

The fair value of these instruments is subject to significant

quarterly adjustments based on the valuation of the underlying private Japanese companies and market conditions, which may result in

non-cash fluctuations in our reported earnings.

Pipeline Delays:

IPO process for Japanese issuers

is subject to regulatory hurdles, audit delays, and market windows that are outside of our control.

Any delay in a client’s filing

of a Form S-1 or F-1 can defer the payment of cash installments.

Niche Market Focus:

Our current business relates exclusively

to Go IPO services for Japanese companies.

Changes in Japanese economic policy, U.S.-Japan trade relations, or a cooling of the U.S.

IPO market specifically for foreign issuers would disproportionately affect our results.

Resource Allocation:

The amount and timing of operating

expenses, particularly the costs associated with bilingual professional staff, process mining licenses, and specialized translation services

required to onboard new clients.

Dependence on Third Parties:

Our ability to fulfill

our service obligations often depends on the schedule and performance of third-party law firms, underwriters, and auditors selected by

Foreign Currency Exchange Rates:

As we serve Japanese

issuers, fluctuations in the JPY/USD exchange rate can affect the value of our consulting fees and the exercise prices of the stock acquisition

rights we hold.

of these and other factors, our past results should not be relied upon as an indication of our future performance.

If our revenue or

operating results in a particular quarter fall below the expectations of investors or securities analysts, or below any guidance we may

provide, the price of our common stock could decline.

provide consulting services and ultimately do not control our client’s abilities to go public in the United States or secure a

listing on American stock exchanges.

providing our consulting services, we do not perform accounting services, and do not act as an investment advisor or broker-dealer.

to the terms of the consulting agreements with the issuers, the parties agree that we will not provide the following services, among others:

to the terms of the consulting agreements with the issuers, the parties agree that we will not provide the following services, among

negotiation of the sale of the issuers’ securities;

participation in discussions between the issuers and potential investors;

in structuring any transactions involving the sale of the issuers’ securities;

assisting in structuring any transactions involving the sale of the issuers’ securities;

pre-screening of potential investors;

due diligence

due diligence activities;

and providing advice relating to valuation of or financial advisability of any investments in the issuers.

Additionally, we

do not take part in the selection of, or negotiation of terms with, law firms, underwriters or audit firms.

Such selection and negotiation

is the sole responsibility of the client.

Additionally, we do not take part in the selection of, or negotiation of terms with, law firms, underwriters or audit firms.

Such selection

and negotiation is the sole responsibility of the client.

GO IPO clients may rely on advice from their third party advisors, including law firms and underwriters.

6 unchanged sentences

could also create delays or terminate our client’s plans.

The value of the equity rights we receive

from our GO IPO clients could be volatile, lose value, and even become worthless.

We do not control the management

or strategies of our GO IPO client companies.

The value of our equity rights received from our consulting Services is tied to the market

value of the client and will likely be volatile.

Among other factors the following occurrences, which is not an exhaustive list, could

reduce the value of our equity rights or even cause our equity rights to become worthless:

If a client company changes management or strategies;

If a client company is engaged in material litigation;

If a client company cannot develop a liquid market for their shares underlying our equity rights;

If a client company cannot satisfy a listing requirement to be listed on an exchange;

If the market value of the equity rights is too low;

If the client company cannot secure market makers;

If the client company cannot meet the rules and requirements mandated by the exchanges and markets;

If the client company suffers a business downturn, through their fault or caused by a material partner or events that affect the market in general;

If the market conditions do not provide an opportunity to capitalize on the equity rights.

Our GO IPO business assists companies in

navigating the initial public offering process in the US markets.

We do not provide investment, accounting, or legal advice.

or federal regulatory agency determined our Company provided legal or investment advice in violation of existing law, there could be a

material adverse effect on our business operations and stock value.

Our GO IPO services assist

companies in improving their internal systems, planning, and readiness to take their company through the IPO process.

We also assist with

introductions to third party professional advisors such as law firms, investment bankers, and auditors, in order that clients can make

their selections, at their sole discretion.

We are not an Investment Company

under the Investment Company Act of 1940, as amended (the “1940 Act”).

The 1940 Act has restrictions that could make it impractical

for us to continue our business as contemplated.

Our GO IPO services providing consulting services and are not in the business of investing,

reinvesting or trading in securities.

An entity will generally be deemed an “investment company” under Section 3(a)(1) of

the 1940 Act if:

(a) it is or holds itself out as being engaged primarily, or proposes to engage primarily, in the business of investing,

reinvesting or trading in securities, or (b) absent an applicable exemption, it owns or proposes to acquire investment securities having

a value exceeding 40% of the value of its total assets (exclusive of U.S.

value of the equity rights we receive from our GO IPO clients could be volatile, lose value, and even become worthless.

do not control the management or strategies of our GO IPO client companies.

The value of our equity rights received from our consulting

services is tied to the market value of the client and will likely be volatile.

Among other factors the following occurrences, which

is not an exhaustive list, could reduce the value of our equity rights or even cause our equity rights to become worthless:

a client company changes management or strategies;

a client company is engaged in material litigation;

a client company cannot develop a liquid market for their shares underlying our equity rights;

a client company cannot satisfy a listing requirement to be listed on an exchange;

the market value of the equity rights is too low;

the client company cannot secure market makers;

the client company cannot meet the rules and requirements mandated by the exchanges and markets;

the client company suffers a business downturn, through their fault or caused by a material partner or events that affect the market

the market conditions do not provide an opportunity to capitalize on the equity rights.

GO IPO business assists companies in navigating the IPO process in the U.S.

We do not provide investment, accounting, or legal

If state or federal regulatory agency determined our Company provided legal or investment advice in violation of existing law,

there could be a material adverse effect on our business operations and stock value.

GO IPO services assist companies in improving their internal systems, planning, and readiness to take their company through the IPO process.

We also assist with introductions to third party professional advisors such as law firms, investment bankers, and auditors, in order

that clients can make their selections, at their sole discretion.

We do not provide investment advice regarding the value of securities,

nor do we engage in the solicitation of investors or the negotiation of securities transactions.

are not an “investment company” under the Investment Company Act of 1940, as amended (the “1940 Act”).

Act has restrictions that could make it impractical for us to continue our business as contemplated.

Our GO IPO services are consulting

services only, and we are not in the business of investing, reinvesting or trading in securities.

An entity will generally be deemed

an “investment company” under Section 3(a)(1) of the 1940 Act if:

(a) it is or holds itself out as being engaged primarily,

or proposes to engage primarily, in the business of investing, reinvesting or trading in securities, or (b) absent an applicable exemption,

it owns or proposes to acquire investment securities having a value exceeding 40% of the value of its total assets (exclusive of U.S.

government securities and cash items) on an unconsolidated basis.

We conduct our operations so that we will not be deemed an investment company.

General Risks

Failure to comply with laws and regulations

could harm our business.

Our business is subject to

regulation by various federal, state, local and foreign governmental agencies, including agencies responsible for monitoring and enforcing

employment and labor laws, workplace safety, environmental laws, consumer protection laws, anti-bribery laws, import/export controls,

federal securities laws and tax laws and regulations.

In certain jurisdictions, these regulatory requirements may be more stringent than

those in the United States.

Noncompliance with applicable regulations or requirements could subject us to investigations, sanctions, mandatory

recalls, enforcement actions, disgorgement of profits, fines, damages, civil and criminal penalties or injunctions.

We are exposed to fluctuations in currency

exchange rates.

We face exposure to movements

in currency exchange rates, which may cause our revenue and operating results to differ materially from expectations.

As we have expanded

our international operations, our exposure to exchange rate fluctuations has increased, in particular with respect to the British Pound

Sterling and Japanese Yen.

As exchange rates vary, revenue, cost of revenue, operating expenses and other operating results, when re-measured,

may differ materially from expectations.

In addition, our operating results are subject to fluctuation if our mix of U.S.

currency denominated transactions and expenses changes in the future.

Furthermore, global political events, including Brexit and similar

geopolitical developments, fluctuating commodity prices and trade tariff developments, have caused global economic uncertainty, which

could amplify the volatility of currency fluctuations.

Such volatility, even when it increases our revenues or decreases our expenses,

impacts our ability to predict our future results and earnings accurately.

Although we may apply certain strategies to mitigate foreign

currency risk, these strategies might not eliminate our exposure to foreign exchange rate fluctuations and would involve costs and risks

of their own, such as ongoing management time and expertise, external costs to implement the strategies and potential accounting implications.

Additionally, as we anticipate growing our business further outside of the United States, the effects of movements in currency exchange

rates will increase as our transaction volume outside of the United States increases.

Weakened global economic conditions may

harm our industry, business and results of operations.

Our overall performance depends

in part on worldwide economic conditions.

Global financial developments and downturns seemingly unrelated to us or the software industry

The United States and other key international economies have been affected from time to time by falling demand for a variety

of goods and services, restricted credit, poor liquidity, reduced corporate profitability, volatility in credit, equity and foreign exchange

markets, bankruptcies, and overall uncertainty with respect to the economy, including with respect to tariff and trade issues.

In particular,

the economies of countries in Europe have been experiencing weakness associated with high sovereign debt levels, weakness in the banking

sector, uncertainty over the future of the Euro zone and volatility in the value of the pound sterling and the Euro, including instability

surrounding Brexit.

We have operations, as well as current and potential new customers, throughout most of Europe.

If economic conditions

in Europe and other key markets for our software continue to remain uncertain or deteriorate further, it could adversely affect our customers’

ability or willingness to subscribe to our software, delay prospective customers’ purchasing decisions, reduce the value or duration

of their subscriptions or affect renewal rates, all of which could harm our operating results.

Our ability to raise capital in the future

may be limited, and our failure to raise capital when needed could prevent us from growing.

Our business and operations

may consume resources faster than we anticipate.

In the future, we may need to raise additional funds to invest in future growth opportunities.

We conduct our operations so that we will not be deemed an investment

our activities were deemed to be those of an unregistered broker-dealer or investment adviser, we could face significant civil and criminal

penalties and our consulting contracts could be rendered void.

to comply with laws and regulations could harm our business.

business is subject to regulation by various federal, state, local and foreign governmental agencies, including agencies responsible

for monitoring and enforcing employment and labor laws, workplace safety, environmental laws, consumer protection laws, anti-bribery

laws, import/export controls, federal securities laws and tax laws and regulations.

In certain jurisdictions, these regulatory requirements

may be more stringent than those in the United States.

Noncompliance with applicable regulations or requirements could subject us to

investigations, sanctions, mandatory recalls, enforcement actions, disgorgement of profits, fines, damages, civil and criminal penalties

or injunctions.

are exposed to fluctuations in currency exchange rates.

We are exposed to fluctuations

in currency exchange rates.

Our operations expose us to movements in foreign currency exchange rates, primarily between the U.S.

and Japanese Yen.

As a result, our revenue, expenses, and operating results may be affected by changes in exchange rates when transactions

denominated in foreign currencies are translated into our reporting currency.

In addition, as we continue to

develop our business in Japan and may expand our operations internationally in the future, our exposure to foreign currency fluctuations

may increase.

Exchange rate volatility may affect our ability to accurately predict our financial results and could result in increased

variability in our reported earnings.

Although we may implement

certain strategies to mitigate foreign currency risks, such strategies may not be effective and may involve additional costs and operational

ability to raise capital in the future may be limited, and our failure to raise capital when needed could prevent us from growing.

business and operations may consume resources faster than we anticipate.

In the future, we may need to raise additional funds to invest

in future growth opportunities.

Additional financing may not be available on favorable terms, if at all.

If adequate funds are not available on acceptable terms, we may

be unable to invest in future growth opportunities, which could seriously harm our business and operating results.

If we incur debt, the

debt holders would have rights senior to common stockholders to make claims on our assets, and the terms of any debt could restrict our

operations, including our ability to pay dividends on our common stock.

Furthermore, if we issue equity securities, stockholders will

experience dilution, and the new equity securities could have rights senior to those of our common stock.

Any additional equity or equity-linked

financings would be dilutive to our stockholders.

Because our decision to issue securities in any future offering will depend on market

conditions and other factors beyond our control, we cannot predict or estimate the amount, timing or nature of our future offerings.

a result, our stockholders bear the risk of our future securities offerings reducing the market price of our common stock and diluting

their interest.

The certificate of incorporation and bylaws

provides that state or federal court located within the state of Delaware will be the sole and exclusive forum for substantially all disputes

between us and our shareholders, which could limit its stockholders’ ability to obtain a favorable judicial forum for disputes with

us or our directors, officers or other employees.

Section 21 of our certificate

of incorporation and Section 7.4 of our bylaws provides that “[u]nless the corporation consents in writing to the selection of an

alternative forum, the sole and exclusive forum for (i) any derivative action or proceeding brought on behalf of the Corporation, (ii)

any action asserting a claim of breach of a fiduciary duty owed by any director, officer or other employee of the Corporation to the Corporation

or the Corporation’s stockholders, (iii) any action asserting a claim arising pursuant to any provision of the DGCL, or (iv) any

action asserting a claim governed by the internal affairs doctrine shall be a state or federal court located in the county in which the

principal office of the corporation in the State of Delaware is established, in all cases subject to the court’s having personal

jurisdiction over the indispensable parties named as defendants.

Notwithstanding the foregoing, the exclusive forum provision will not

apply to suits brought to enforce any liability or duty created by the Exchange of 1934, as amended, the Securities Act of 1933, as amended,

or any claim for which the federal courts have exclusive or concurrent jurisdiction.” Therefore, the exclusive forum provision in

our certificate of incorporation and our bylaws will not relieve us of our duty to comply with the federal securities laws and the rules

and regulations thereunder, and shareholders will not be deemed to have waived our compliance with these laws, rules and regulations.

This exclusive forum provision

may limit a shareholder’s ability to bring a claim in a judicial forum of its choosing for disputes with us or our directors, officers

or other employees, which may discourage lawsuits against us or our directors, officers or other employees.

In addition, shareholders

who do bring a claim in the state or federal court in the State of Delaware could face additional litigation costs in pursuing any such

claim, particularly if they do not reside in or near Delaware.

The state or federal court of the State of Delaware may also reach different

judgments or results than would other courts, including courts where a shareholder would otherwise choose to bring the action, and such

judgments or results may be more favorable to us than to our shareholders.

However, the enforceability of similar exclusive forum provisions

in other companies’ certificates of incorporation have been challenged in legal proceedings, and it is possible that a court could

find this type of provision to be inapplicable to, or unenforceable in respect of, one or more of the specified types of actions or proceedings.

If a court were to find the exclusive forum provision contained in our certificate of incorporation and our bylaws to be inapplicable

or unenforceable in an action, we might incur additional costs associated with resolving such action in other jurisdictions.

You are bound by the fee-shifting provision

contained in our bylaws, which may discourage you to pursue actions against us and could discourage shareholder lawsuits that might otherwise

benefit the Company and its shareholders.

Section 7.4 of our bylaws

provides that “[i]f any action is brought by any party against another party, relating to or arising out of these Bylaws, or the

enforcement hereof, the prevailing party shall be entitled to recover from the other party reasonable attorneys’ fees, costs and

expenses incurred in connection with the prosecution or defense of such action.”

Our bylaws provide that for

this section, the term “attorneys’ fees” or “attorneys’ fees and costs” means the fees and expenses

of counsel to the Company and any other parties asserting a claim subject to Section 7.4 of the bylaws, which may include printing, photocopying,

duplicating and other expenses, air freight charges, and fees billed for law clerks, paralegals and other persons not admitted to the

bar but performing services under the supervision of an attorney, and the costs and fees incurred in connection with the enforcement or

collection of any judgment obtained in any such proceeding.

We adopted the fee-shifting

provision to eliminate or decrease nuisance and frivolous litigation.

We intend to apply the fee-shifting provision broadly to all actions

except for claims brought under the Exchange Act and Securities Act.

There is no set level of recovery

required to be met by a plaintiff to avoid payment under this provision.

Instead, whoever is the prevailing party is entitled to recover

the reasonable attorneys’ fees, costs and expenses incurred in connection with the prosecution or defense of such action.

who brings an action, and the party against whom such action is brought under Section 7.4 of our bylaws, which could include, but is not

limited to former and current shareholders, Company directors, officers, affiliates, legal counsel, expert witnesses and other parties,

are subject to this provision.

Additionally, any party who brings an action, and the party against whom such action is brought under Section

7.4 of our bylaws, which could include, but is not limited to former and current shareholders, Company directors, officers, affiliates,

legal counsel, expert witnesses and other parties, would be able to recover fees under this provision.

In the event you initiate

or assert a claim against us, in accordance with the dispute resolution provisions contained in our Bylaws, and you do not, in a judgment

prevail, you will be obligated to reimburse us for all reasonable costs and expenses incurred in connection with such claim, including,

but not limited to, reasonable attorney’s fees and expenses and costs of appeal, if any.

Additionally, this provision in Section

7.4 of our bylaws could discourage shareholder lawsuits that might otherwise benefit the Company and its shareholders.

THE FEE SHIFTING PROVISION

CONTAINED IN THE BYLAWS IS NOT INTENDED TO BE DEEMED A WAIVER BY ANY HOLDER OF COMMON STOCK OF THE COMPANY’S COMPLIANCE WITH THE

If adequate funds are not available

on acceptable terms, we may be unable to invest in future growth opportunities, which could seriously harm our business and operating

If we incur debt, the debt holders would have rights senior to common stockholders to make claims on our assets, and the terms

of any debt could restrict our operations, including our ability to pay dividends on our common stock.

Furthermore, if we issue equity

securities, stockholders will experience dilution, and the new equity securities could have rights senior to those of our common stock.

Any additional equity or equity-linked financings would be dilutive to our stockholders.

Because our decision to issue securities in

any future offering will depend on market conditions and other factors beyond our control, we cannot predict or estimate the amount,

timing or nature of our future offerings.

As a result, our stockholders bear the risk of our future securities offerings reducing the

market price of our common stock and diluting their interest.

Company’s certificate of incorporation, as amended (the “Certificate of Incorporation”), and bylaws provide that state

or federal court located within the state of Delaware will be the sole and exclusive forum for substantially all disputes between us

and our shareholders, which could limit its stockholders’ ability to obtain a favorable judicial forum for disputes with us or

our directors, officers or other employees.

21 of our Certificate of Incorporation and Section 7.4 of our bylaws provides that “[u]nless the corporation consents in writing

to the selection of an alternative forum, the sole and exclusive forum for (i) any derivative action or proceeding brought on behalf

of the Corporation, (ii) any action asserting a claim of breach of a fiduciary duty owed by any director, officer or other employee of

the Corporation to the Corporation or the Corporation’s stockholders, (iii) any action asserting a claim arising pursuant to any

provision of the DGCL, or (iv) any action asserting a claim governed by the internal affairs doctrine shall be a state or federal court

located in the county in which the principal office of the corporation in the State of Delaware is established, in all cases subject

to the court’s having personal jurisdiction over the indispensable parties named as defendants.

Notwithstanding the foregoing,

the exclusive forum provision will not apply to suits brought to enforce any liability or duty created by the Exchange of 1934, as amended,

the Securities Act of 1933, as amended, or any claim for which the federal courts have exclusive or concurrent jurisdiction.” Therefore,

the exclusive forum provision in our Certificate of Incorporation and our bylaws will not relieve us of our duty to comply with the federal

securities laws and the rules and regulations thereunder, and shareholders will not be deemed to have waived our compliance with these

laws, rules and regulations.

exclusive forum provision may limit a shareholder’s ability to bring a claim in a judicial forum of its choosing for disputes with

us or our directors, officers or other employees, which may discourage lawsuits against us or our directors, officers or other employees.

In addition, shareholders who do bring a claim in the state or federal court in the State of Delaware could face additional litigation

costs in pursuing any such claim, particularly if they do not reside in or near Delaware.

The state or federal court of the State of

Delaware may also reach different judgments or results than would other courts, including courts where a shareholder would otherwise

choose to bring the action, and such judgments or results may be more favorable to us than to our shareholders.

However, the enforceability

of similar exclusive forum provisions in other companies’ certificates of incorporation have been challenged in legal proceedings,

and it is possible that a court could find this type of provision to be inapplicable to, or unenforceable in respect of, one or more

of the specified types of actions or proceedings.

If a court were to find the exclusive forum provision contained in our Certificate

of Incorporation and our bylaws to be inapplicable or unenforceable in an action, we might incur additional costs associated with resolving

such action in other jurisdictions.

are bound by the fee-shifting provision contained in our bylaws, which may discourage you to pursue actions against us and could discourage

shareholder lawsuits that might otherwise benefit the Company and its shareholders.

7.4 of our bylaws provides that “[i]f any action is brought by any party against another party, relating to or arising out of these

Bylaws, or the enforcement hereof, the prevailing party shall be entitled to recover from the other party reasonable attorneys’

fees, costs and expenses incurred in connection with the prosecution or defense of such action.”

bylaws provide that for this section, the term “attorneys’ fees” or “attorneys’ fees and costs” means

the fees and expenses of counsel to the Company and any other parties asserting a claim subject to Section 7.4 of the bylaws, which may

include printing, photocopying, duplicating and other expenses, air freight charges, and fees billed for law clerks, paralegals and other

persons not admitted to the bar but performing services under the supervision of an attorney, and the costs and fees incurred in connection

with the enforcement or collection of any judgment obtained in any such proceeding.

adopted the fee-shifting provision to eliminate or decrease nuisance and frivolous litigation.

We intend to apply the fee-shifting provision

broadly to all actions except for claims brought under the Exchange Act and Securities Act.

is no set level of recovery required to be met by a plaintiff to avoid payment under this provision.

Instead, whoever is the prevailing

party is entitled to recover the reasonable attorneys’ fees, costs and expenses incurred in connection with the prosecution or

defense of such action.

Any party who brings an action, and the party against whom such action is brought under Section 7.4 of our bylaws,

which could include, but is not limited to former and current shareholders, Company directors, officers, affiliates, legal counsel, expert

witnesses and other parties, are subject to this provision.

Additionally, any party who brings an action, and the party against whom

such action is brought under Section 7.4 of our bylaws, which could include, but is not limited to former and current shareholders, Company

directors, officers, affiliates, legal counsel, expert witnesses and other parties, would be able to recover fees under this provision.

the event you initiate or assert a claim against us, in accordance with the dispute resolution provisions contained in our Bylaws, and

you do not, in a judgment prevail, you will be obligated to reimburse us for all reasonable costs and expenses incurred in connection

with such claim, including, but not limited to, reasonable attorney’s fees and expenses and costs of appeal, if any.

Additionally,

this provision in Section 7.4 of our bylaws could discourage shareholder lawsuits that might otherwise benefit the Company and its shareholders.

FEE SHIFTING PROVISION CONTAINED IN THE BYLAWS IS NOT INTENDED TO BE DEEMED A WAIVER BY ANY HOLDER OF COMMON STOCK OF THE COMPANY’S

COMPLIANCE WITH THE U.S.

FEDERAL SECURITIES LAWS AND THE RULES AND REGULATIONS PROMULGATED THEREUNDER.

THE FEE SHIFTING PROVISION CONTAINED IN THE BYLAWS

DO NOT APPLY TO CLAIMS BROUGHT UNDER THE EXCHANGE ACT AND SECURITIES ACT.

Risks Related to Employee Matters

If we cannot maintain our company culture

as we grow, we could lose the innovation, teamwork, passion and focus on execution that we believe contribute to our success and our business

may be harmed.

We believe that a critical

component to our success has been our company culture, which is based on transparency and personal autonomy.

We have invested substantial

time and resources in building our team within this company culture.

Any failure to preserve our culture could negatively affect our ability

to retain and recruit personnel and to effectively focus on and pursue our corporate objectives.

As we grow as and continue to develop

the infrastructure of a public company, we may find it difficult to maintain these important aspects of our company culture.

to maintain our company culture, our business may be adversely impacted.

We rely on our management team and other

key employees, and the loss of one or more key employees could harm our business.

Our success and future growth

depend upon the continued services of our management team, including our Chief Executive Officer, Sumitaka Yamamoto, and other key employees

in the areas of research and development, marketing, sales, services, content management, and general and administrative functions.

time to time, there may be changes in our management team resulting from the hiring or departure of executives, which could disrupt our

We also are dependent on the continued service of our existing software engineers and information technology personnel because

of the complexity of our software, technologies and infrastructure.

We may terminate any employee’s employment at any time, with

or without cause, and any employee may resign at any time, with or without cause (In Japan, termination of employee can only be justified

for material cause).

THE FEE SHIFTING PROVISION CONTAINED

IN THE BYLAWS DO NOT APPLY TO CLAIMS BROUGHT UNDER THE EXCHANGE ACT AND SECURITIES ACT.

Related to Employee Matters

we cannot maintain our company culture as we grow, we could lose the innovation, teamwork, passion and focus on execution that we believe

contribute to our success and our business may be harmed.

believe that a critical component to our success has been our company culture, which is based on transparency and personal autonomy.

We have invested substantial time and resources in building our team within this company culture.

Any failure to preserve our culture

could negatively affect our ability to retain and recruit personnel and to effectively focus on and pursue our corporate objectives.

As we grow, we may find it difficult to maintain these important aspects of our company culture.

If we fail to maintain our company culture,

our business may be adversely impacted.

rely on our management team and other key employees, and the loss of one or more key employees could harm our business.

success and future growth depend upon the continued services of our management team, including our Chief Executive Officer, Sumitaka

Yamamoto, and other key employees.

From time to time, there may be changes in our management team resulting from the hiring or departure

of executives, which could disrupt our business.

The loss of one or more of our key employees could harm our business.

The failure to attract and retain additional

qualified personnel could prevent us from executing our business strategy.

To execute our business strategy,

we must attract and retain highly qualified personnel.

In particular, we compete with many other companies for software developers with

high levels of experience in designing, developing and managing cloud-based software, as well as for skilled information technology, marketing,

sales and operations professionals, and we may not be successful in attracting and retaining the professionals we need.

Also, inbound

sales, marketing, services, and content management domain experts are very important to our success and are difficult to replace.

from time to time in the past experienced, and we expect to continue to experience in the future, difficulty in hiring and difficulty

in retaining highly skilled employees with appropriate qualifications.

In particular, we have experienced a competitive hiring environment

in Japan, where we are headquartered and will continue to experience a competitive hiring environment as we recruit for remote talent

Many of the companies with which we compete for experienced personnel have greater resources than we do.

In addition, in making

employment decisions, particularly in the software industry, job candidates often consider the value of the stock options or other equity

incentives they are to receive in connection with their employment.

If the price of our stock declines, or experiences significant volatility,

our ability to attract or retain key employees will be adversely affected.

If we fail to attract new personnel or fail to retain and motivate

our current personnel, our growth prospects could be severely harmed.

Risks Related to Our Technical Operations Infrastructure

and Dependence on Third Parties

Interruptions or delays in service from

our third-party data center providers could impair our ability to deliver our software to our customers, resulting in customer dissatisfaction,

damage to our reputation, loss of customers, limited growth and reduction in revenue.

We currently serve some parts

of our software functions from third-party data center hosting facilities operated by Amazon and IBM.

In addition, we serve ancillary

functions for our customers from third-party data center hosting facilities operated by Amazon, with a backup facility in Amazon.

operations depend, in part, on our third-party facility providers’ abilities to protect these facilities against damage or interruption

from natural disasters, such as earthquakes and hurricanes, actual or threatened public health emergency (e.g., COVID-19), power or telecommunications

failures, criminal acts and similar events.

In the event that any of our third-party facilities arrangements is terminated, or if there

is a lapse of service or damage to a facility, we could experience interruptions in our software as well as delays and additional expenses

in arranging new facilities and services.

Any damage to, or failure

of, the systems of our third-party providers could result in interruptions to our software.

Despite precautions taken at our data centers,

the occurrence of spikes in usage volume, a natural disaster, such as earthquakes or hurricane, an act of terrorism, vandalism or sabotage,

a decision to close a facility without adequate notice, or other unanticipated problems at a facility could result in lengthy interruptions

in the availability of our on-demand software.

Even with current and planned disaster recovery arrangements, our business could be harmed.

Also, in the event of damage or interruption, our insurance policies may not adequately compensate us for any losses that we may incur.

These factors in turn could further reduce our revenue, subject us to liability and cause us to issue credits or cause customers to fail

to renew their subscriptions, any of which could materially adversely affect our business.

If our software has outages or fails due

to defects or similar problems, and if we fail to correct any defect or other software problems, we could lose customers, become subject

to service performance or warranty claims or incur significant costs.

Our software and its underlying

infrastructure are inherently complex and may contain material defects or errors.

We release modifications, updates, bug fixes and other

changes to our software several times per day, without traditional human-performed quality control reviews for each release.

time to time found defects in our software and may discover additional defects in the future.

We may not be able to detect and correct

defects or errors before customers begin to use our software or its applications.

Consequently, we or our customers may discover defects

or errors after our software has been implemented.

In the past, we have experienced

software outages caused by power supply failures.

Although no data was lost due to the outages, our customers experienced disruptions

in using our software as our website stopped operating as well as our marketing campaigns, e-mail newsletters and other functions were

Notwithstanding, the outages were short in duration and we are not aware of any negative customer reviews and negative press

as a result of the outages.

We believe there was no significant damage to our customer relationships, reputation and brand due to these

We believe the outage did not compromise our ability to meet customer expectations, manage our software, or meet our operating

efficiency and profitability goals.

Defects or errors could result

in product outages and could also cause inaccuracies in the data we collect and process for our customers, or even the loss, damage or

inadvertent release of such confidential data.

We implement bug fixes and upgrades as part of our regular system maintenance, which may

lead to system downtime.

Even if we are able to implement the bug fixes and upgrades in a timely manner, any history of product outages,

defects or inaccuracies in the data we collect for our customers, or the loss, damage or inadvertent release of confidential data could

cause our reputation to be harmed, and customers may elect not to purchase or renew their agreements with us.

Furthermore, these issues

could subject us to service performance credits (whether offered by us or required by contract), warranty claims or increased insurance

The costs associated with product outages, any material defects or errors in our software or other performance problems may be

substantial and could materially adversely affect our operating results.

In addition, third-party apps

and features on our software may not meet the same quality standards that we apply to our own development efforts and, to the extent they

contain bugs, vulnerabilities or defects, they may create disruptions in our customers’ use of our products, lead to data loss,

unauthorized access to customer data, damage our brand and reputation and affect the continued use of our products, any of which could

harm our business, results of operations and financial condition.

We are dependent on the continued availability

of third-party data hosting and transmission services.

A significant portion of our

operating cost is from our third-party data hosting and transmission services.

If the costs for such services increase due to vendor consolidation,

regulation, contract renegotiation, or otherwise, we may not be able to increase the fees for our software or services to cover the changes.

As a result, our operating results may be significantly worse than forecasted.

If we do not or cannot maintain the compatibility

of our software with third-party applications that our customers use in their businesses, our revenue will decline.

A significant percentage of

our customers choose to integrate our software with certain capabilities provided by third-party application providers using APIs published

by these providers.

The functionality and popularity of our software depends, in part, on our ability to integrate our software with third-party

applications and software, including content management systems, customer experience management systems, e-commerce, call center, analytics

and social media sites that our customers use and from which they obtain data.

Third-party providers of applications and APIs may change

the features of their applications and software, restrict our access to their applications and software, or alter the terms governing

use of their applications and APIs and access to those applications and software in an adverse manner.

Such changes could functionally

limit or terminate our ability to use these third-party applications and software in conjunction with our software, which could negatively

impact our offerings and harm our business.

If we fail to integrate our software with new third-party applications and software that our

customers use for marketing, content management, customer experience management, or robotic process automation purposes, or fail to renew

existing relationships pursuant to which we currently provide such integration, we may not be able to offer the functionality that our

customers need, which would negatively impact our ability to generate new revenue or maintain existing revenue and adversely impact our

We rely on data provided by third parties,

the loss of which could limit the functionality of our software and disrupt our business.

Select functionality of our

software depends on our ability to deliver data, including search engine results and social media updates, provided by unaffiliated third

parties, such as Facebook, Google, LinkedIn and Twitter.

Some of this data is provided to us pursuant to third-party data sharing policies

and terms of use, under data sharing agreements by third-party providers or by customer consent.

In the future, any of these third parties

could change its data sharing policies, including making them more restrictive, or alter its algorithms that determine the placement,

display, and accessibility of search results and social media updates, any of which could result in the loss of, or significant impairment

to, our ability to collect and provide useful data to our customers.

These third parties could also interpret our, or our service providers’,

data collection policies or practices as being inconsistent with their policies, which could result in the loss of our ability to collect

this data for our customers.

Any such changes could impair our ability to deliver data to our customers and could adversely impact select

functionality of our software, impairing the return on investment that our customers derive from using our solution, as well as adversely

affecting our business and our ability to generate revenue.

We also rely on the availability and accuracy of this data, and any changes

in the availability or accuracy of such data could adversely impact our business and results of operations and harm our reputation and

Privacy concerns and end users’ acceptance

of Internet behavior tracking may limit the applicability, use and adoption of our software.

Privacy concerns may cause

end users to resist providing the personal data necessary to allow our customers to use our software effectively.

We have implemented

various features intended to enable our customers to better protect end user privacy, but these measures may not alleviate all potential

privacy concerns and threats.

Even the perception of privacy concerns, whether or not valid, may inhibit market adoption of our software,

especially in certain industries that rely on sensitive personal information.

Privacy advocacy groups and the technology and other industries

are considering various new, additional or different self-regulatory standards that may place additional burdens on us.

The costs of compliance

with, and other burdens imposed by these groups’ policies and actions may limit the use and adoption of our software and reduce

overall demand for it, or lead to significant fines, penalties or liabilities for any noncompliance or loss of any such action.

If our or our customers’ security

measures are compromised or unauthorized access to data of our customers or their customers is otherwise obtained, our software may be

perceived as not being secure, our customers may be harmed and may curtail or cease their use of our software, our reputation may be damaged

and we may incur significant liabilities.

Our operations involve the

storage and transmission of data of our customers and their customers, including personally identifiable information.

Our storage is typically

the sole source of record for portions of our customers’ businesses and end user data, such as initial contact information and online

interactions.

Security incidents could result in unauthorized access to, loss of or unauthorized disclosure of this information, litigation,

indemnity obligations and other possible liabilities, as well as negative publicity, which could damage our reputation, impair our sales

and harm our customers and our business.

Cyber-attacks and other malicious Internet-based activity continue to increase generally, and

cloud-based software providers of marketing services have been targeted.

If our security measures are compromised as a result of third-party

action, employee or customer error, malfeasance, stolen or fraudulently obtained log-in credentials or otherwise, our reputation could

be damaged, our business may be harmed and we could incur significant liability.

If third parties with whom we work, such as vendors or

developers, violate applicable laws, our security policies or our acceptable use policy, such violations may also put our customers’

information at risk and could in turn have an adverse effect on our business.

In addition, if the security measures of our customers are

compromised, even without any actual compromise of our own systems, we may face negative publicity or reputational harm if our customers

or anyone else incorrectly attributes the blame for such security breaches to us or our systems.

We may be unable to anticipate or prevent

techniques used to obtain unauthorized access or to sabotage systems because they change frequently and generally are not detected until

after an incident has occurred.

As we increase our customer base and our brand becomes more widely known and recognized, we may become

more of a target for third parties seeking to compromise our security systems or gain unauthorized access to our customers’ data.

Additionally, we provide extensive access to our database, which stores our customer data, to our development team to facilitate our rapid

pace of product development.

If such access or our own operations cause the loss, damage or destruction of our customers’ business

data, their sales, lead generation, support and other business operations may be permanently harmed.

As a result, our customers may bring

claims against us for lost profits and other damages.

Our internal computer systems

and those of our current and any future strategic collaborators, vendors, and other contractors or consultants are vulnerable to damage

from cyber-attacks, computer viruses, unauthorized access, natural disasters, cybersecurity threats, terrorism, war and telecommunication

and electrical failures.

Cyber incidents have been increasing in sophistication and frequency and can include third parties gaining access

to employee or customer data using stolen or inferred credentials, computer malware, viruses, spamming, phishing attacks, ransomware,

card skimming code, and other deliberate attacks and attempts to gain unauthorized access.

Because the techniques used by computer programmers

who may attempt to penetrate and sabotage our network security or our website change frequently and may not be recognized until launched

against a target, we may be unable to anticipate these techniques.

Additionally, during the ongoing pandemic, and potentially beyond as

remote work and resource access expand, there is an increased risk that we may experience cybersecurity-related events such as phishing attacks, exploitation of any cybersecurity flaws that may exist, an increase in the number cybersecurity threats or attacks,

and other security challenges as a result of most of our employees and our service providers continuing to work remotely from non-corporate

managed networks.

If we were to experience a

cyberattack and suffer interruptions in our operations, it could result in a material disruption of our development programs and our business

operations, whether due to a loss of our trade secrets or other proprietary information or other disruptions.

These cyber-attacks could

be carried out by threat actors of all types (including but not limited to nation states, organized crime, other criminal enterprises,

individual actors and/or advanced persistent threat groups).

In addition, we may experience intrusions on our physical premises by any

of these threat actors.

To the extent that any disruption or security breach were to result in a loss of, or damage to, our data or applications,

or inappropriate disclosure of confidential or proprietary information, we could incur liability and our competitive position could be

Any breach, loss, or compromise of personal data may also subject us to civil fines and penalties, or claims for damages either

under foreign laws, and other relevant state and federal privacy laws.

Many governments have enacted

laws requiring companies to notify individuals of data security incidents or unauthorized transfers involving certain types of personal

In addition, some of our customers contractually require notification of any data security compromise.

Security compromises experienced

by our competitors, by our customers or by us may lead to public disclosures, which may lead to widespread negative publicity.

compromise in our industry, whether actual or perceived, could harm our reputation, erode customer confidence in the effectiveness of

our security measures, negatively impact our ability to attract new customers, cause existing customers to elect not to renew their subscriptions

or subject us to third-party lawsuits, regulatory fines or other action or liability, which could materially and adversely affect our

business and operating results.

There can be no assurance

that any limitations of liability provisions in our contracts for a security breach would be enforceable or adequate or would otherwise

protect us from any such liabilities or damages with respect to any particular claim.

We also cannot be sure that our existing general

liability insurance coverage and coverage for errors or omissions will continue to be available on acceptable terms or will be available

in sufficient amounts to cover one or more large claims, or that the insurer will not deny coverage as to any future claim.

The successful

assertion of one or more large claims against us that exceed available insurance coverage, or the occurrence of changes in our insurance

policies, including premium increases or the imposition of large deductible or co-insurance requirements, could have a material adverse

effect on our business, financial condition and operating results.

Risks Related to Intellectual Property

Our business may suffer if it is alleged

or determined that our technology infringes the intellectual property rights of others.

The software industry is characterized

by the existence of a large number of patents, copyrights, trademarks, trade secrets and other intellectual and proprietary rights.

in the software industry, including those in marketing software, are often required to defend against litigation claims based on allegations

of infringement or other violations of intellectual property rights.

Many of our competitors and other industry participants have been

issued patents and/or have filed patent applications and may assert patent or other intellectual property rights within the industry.

Moreover, in recent years, individuals and groups that are non-practicing entities, commonly referred to as “patent trolls,”

have purchased patents and other intellectual property assets for the purpose of making claims of infringement in order to extract settlements.

From time to time, we may receive threatening letters or notices or may be the subject of claims that our services and/or software and

underlying technology infringe or violate the intellectual property rights of others.

Responding to such claims, regardless of their merit,

can be time consuming, costly to defend in litigation, divert management’s attention and resources, damage our reputation and brand

and cause us to incur significant expenses.

Our technologies may not be able to withstand any third-party claims or rights against their

Claims of intellectual property infringement might require us to redesign our application, delay releases, enter into costly settlement

or license agreements or pay costly damage awards, or face a temporary or permanent injunction prohibiting us from marketing or selling

our software.

If we cannot or do not license the infringed technology on reasonable terms or at all, or substitute similar technology

from another source, our revenue and operating results could be adversely impacted.

Additionally, our customers may not purchase our software

if they are concerned that they may infringe third-party intellectual property rights.

The occurrence of any of these events may have

a material adverse effect on our business.

In our subscription agreements

with our customers, we generally do not agree to indemnify our customers against any losses or costs incurred in connection with claims

by a third party alleging that a customer’s use of our services or software infringes the intellectual property rights of the third

There can be no assurance, however, that customers will not assert a common law indemnity claim or that any existing limitations

of liability provisions in our contracts would be enforceable or adequate, or would otherwise protect us from any such liabilities or

damages with respect to any particular claim.

Our customers who are accused of intellectual property infringement may in the future seek

indemnification from us under common law or other legal theories.

If such claims are successful, or if we are required to indemnify or

defend our customers from these or other claims, these matters could be disruptive to our business and management and have a material

adverse effect on our business, operating results and financial condition.

If we fail to adequately protect our proprietary

rights, in Japan and abroad, our competitive position could be impaired and we may lose valuable assets, experience reduced revenue and

incur costly litigation to protect our rights.

Our success is dependent,

in part, upon protecting our proprietary technology.

We rely on a combination of copyrights, trademarks, service marks, trade secret laws

and contractual restrictions to establish and protect our proprietary rights in our products and services.

However, the steps we take

to protect our intellectual property may be inadequate.

We will not be able to protect our intellectual property if we are unable to enforce

our rights or if we do not detect unauthorized use of our intellectual property.

Any of our trademarks or other intellectual property

rights may be challenged by others or invalidated through administrative process or litigation.

Furthermore, legal standards relating

to the validity, enforceability and scope of protection of intellectual property rights are uncertain.

Despite our precautions, it may

be possible for unauthorized third parties to copy our technology and use information that we regard as proprietary to create products

and services that compete with ours.

Some license provisions protecting against unauthorized use, copying, transfer and disclosure of

our offerings may be unenforceable under the laws of certain jurisdictions and foreign countries.

In addition, the laws of some countries

do not protect proprietary rights to the same extent as the laws of Japan or the United States.

To the extent we expand our international

activities, our exposure to unauthorized copying and use of our technology and proprietary information may increase.

We enter into confidentiality

and invention assignment agreements with our employees and consultants and enter into confidentiality agreements with the parties with

whom we have strategic relationships and business alliances.

No assurance can be given that these agreements will be effective in controlling

access to and distribution of our products and proprietary information.

Further, these agreements may not prevent our competitors from

independently developing technologies that are substantially equivalent or superior to our software and offerings.

We may be required to spend

significant resources to monitor and protect our intellectual property rights.

Litigation may be necessary in the future to enforce our

intellectual property rights and to protect our trade secrets.

Such litigation could be costly, time consuming and distracting to management

and could result in the impairment or loss of portions of our intellectual property.

Furthermore, our efforts to enforce our intellectual

property rights may be met with defenses, counterclaims and countersuits attacking the validity and enforceability of our intellectual

property rights.

Our inability to protect our proprietary technology against unauthorized copying or use, as well as any costly litigation,

could delay further sales or the implementation of our software and offerings, impair the functionality of our software and offerings,

delay introductions of new features or enhancements, result in our substituting inferior or more costly technologies into our software

and offerings, or injure our reputation.

Our use of “open-source” software

could negatively affect our ability to offer our software and subject us to possible litigation.

A substantial portion of our

cloud-based software incorporates so-called “open source” software, and we may incorporate additional open-source software

in the future.

Open-source software is generally freely accessible, usable and modifiable.

Certain open-source licenses may, in certain

circumstances, require us to offer the components of our software that incorporate the open-source software for no cost, that we make

available source code for modifications or derivative works we create based upon, incorporating or using the open-source software and

that we license such modifications or derivative works under the terms of the particular open source license.

If an author or other third

party that distributes open source software we use were to allege that we had not complied with the conditions of one or more of these

licenses, we could be required to incur significant legal expenses defending against such allegations and could be subject to significant

damages, including being enjoined from the offering of the components of our software that contained the open source software and being

required to comply with the foregoing conditions, which could disrupt our ability to offer the affected software.

We could also be subject

to suits by parties claiming ownership of what we believe to be open-source software.

Litigation could be costly for us to defend, have

a negative effect on our operating results and financial condition and require us to devote additional research and development resources

to change our products.

Risks Related to Government Regulation

We are subject to governmental regulation

and other legal obligations, particularly related to privacy, data protection and information security, and our actual or perceived failure

to comply with such obligations could harm our business.

Compliance with such laws could also impair our efforts to maintain and expand

our customer base, and thereby decrease our revenue.

Our handling of data is subject

to a variety of laws and regulations, including regulation by various government agencies, including the Ministry of Internal Affairs

and Communications, Personal Information Protection Commission Japan (the “PPCJ”), the U.S.

Federal Trade Commission (the

“FTC”), and various state, local and foreign agencies.

We collect personally identifiable information and other data from

our customers and leads.

We also handle personally identifiable information about our customers’ customers.

We use this information

to provide services to our customers, to support, expand and improve our business.

We may also share customers’ personally identifiable

information with third parties as authorized by the customer or as described in our privacy policy.

The Japanese and U.S.

and various state and foreign governments have adopted or proposed limitations on the collection, distribution, use and storage of personal

information of individuals.

In the United States, the FTC and many state attorneys general are applying federal and state consumer protection

laws, and in Japan, the PPCJ are issuing orders and guidelines based on the Personal Information Protection Act, as imposing standards

for the online collection, use and dissemination of data.

However, these obligations may be interpreted and applied in a manner that is

inconsistent from one jurisdiction to another and may conflict with other requirements or our practices.

Any failure or perceived failure

by us to comply with privacy or security laws, policies, legal obligations or industry standards or any security incident that results

in the unauthorized release or transfer of personally identifiable information or other customer data may result in governmental enforcement

actions, litigation, fines and penalties and/or adverse publicity, and could cause our customers to lose trust in us, which could have

an adverse effect on our reputation and business.

Laws and regulations concerning

privacy, data protection and information security are evolving, and changes to such laws and regulations could require us to change features

of our software or restrict our customers’ ability to collect and use email addresses, page viewing data and personal information,

which may reduce demand for our software.

Our failure to comply with national, federal, state and international data privacy laws and

regulations could harm our ability to successfully operate our business and pursue our business goals.

For example, California recently

enacted the California Consumer Privacy Act (the “CCPA”) that, among other things, require covered companies to provide new

disclosures to California consumers and afford such consumers new abilities to opt-out of certain sales of personal information.

recently was amended and it is not yet fully clear how the CCPA will be enforced and how certain of its requirements will be interpreted.

We cannot yet predict the impact of the CCPA on our business or operations, but it may require us to modify our data processing practices

and policies and to incur substantial costs and expenses in an effort to comply.

Additionally, a new California

ballot initiative, the California Privacy Rights Act (the “CPRA”) was passed in November 2020 and became effective starting

on January 1, 2023, the CPRA imposes additional obligations on companies covered by the legislation and will significantly modify the

CCPA, including by expanding consumers’ rights with respect to certain sensitive personal information.

The CPRA also creates a new

state agency that will be vested with authority to implement and enforce the CCPA and the CPRA.

The effects of the CCPA and the CPRA are

potentially significant and may require us to modify our data collection or processing practices and policies and to incur substantial

costs and expenses in an effort to comply and increase our potential exposure to regulatory enforcement and/or litigation.

Certain other state laws impose

similar privacy obligations and we also expect anticipate that more states to may enact legislation similar to the CCPA, which provides

consumers with new privacy rights and increases the privacy and security obligations of entities handling certain personal information

of such consumers.

The CCPA has prompted a number of proposals for new federal and state-level privacy legislation.

Such proposed legislation,

if enacted, may add additional complexity, variation in requirements, restrictions and potential legal risk, require additional investment

of resources in compliance programs, impact strategies and the availability of previously useful data and could result in increased compliance

costs and/or changes in business practices and policies.

In addition, on March 2, 2021,

Virginia enacted the Consumer Data Protection Act (the “CDPA”), which become effective on January 1, 2023.

The CDPA regulates

how businesses (which the CDPA refers to as “controllers”) collect and share personal information.

While the CDPA incorporates

many similar concepts of the CCPA and CPRA, there are also several key differences in the scope, application, and enforcement of the law

that will change the operational practices of controllers.

The new law impacts how controllers collect and process personal sensitive

data, conduct data protection assessments, transfer personal data to affiliates, and respond to consumer rights requests.

In addition, several foreign

jurisdictions, including the European Union and Canada, have regulations dealing with the collection and use of personal information obtained

from their residents, which are often more restrictive than those in the U.S.

Laws and regulations in these jurisdictions apply broadly

to the collection, use, storage, disclosure and security of personal information that identifies or may be used to identify an individual.

In relevant part, these laws and regulations may affect our ability to engage in lead generation activities by imposing heightened requirements,

such as affirmative opt-ins or consent prior to sending commercial correspondence or engaging in electronic tracking activities.

a recent ruling of the European Court of Justice in Case C-673/17 provides that a pre-checked opt-in is insufficient to constitute a valid

active consumer consent to cookie storage.

In order to obtain “the adequate protection” status under the European Union’s

General Data Protection Regulation (the “GDPR”), the Japanese laws and regulations in this area were amended as much as practically

possible by January 23, 2019 and thus the collection, use and transfer of personal data is similarly restricted.

Within the European Union,

legislators have adopted the GDPR and which became effective in May 2018 which may impose additional obligations and risk upon our business

and which may increase substantially the penalties to which we could be subject in the event of any non-compliance.

In addition, further

to the United Kingdom’s exit from the European Union on January 31, 2020, the GDPR ceased to apply in the United Kingdom at the

end of the transition period on December 31, 2020.

However, as of January 1, 2021, the United Kingdom’s European Union (Withdrawal)

Act 2018 incorporated the GDPR (as it existed on December 31, 2020 but subject to certain United Kingdom specific amendments) into United

Kingdom law (the “UK GDPR”).

The UK GDPR and the UK Data Protection Act 2018 set out the United Kingdom’s data protection

regime, which is independent from but aligned to the European Union’s data protection regime.

Non-compliance with the UK GDPR may

result in monetary penalties of up to £17.5 million or 4% of worldwide revenue, whichever is higher.

The United Kingdom, however,

is now regarded as a third country under the European Union’s GDPR which means that transfers of personal data from the European

Economic Area to the United Kingdom will be restricted unless an appropriate safeguard, as recognized by the European Union’s GDPR,

has been put in place.

However, under the EU-UK Trade Cooperation Agreement it is lawful to transfer personal data between the United

Kingdom and the European Economic Area for a 6 month period following the end of the transition period, with a view to achieving an adequacy

decision from the European Commission during that period.

Like the GDPR, the UK GDPR restricts personal data transfers outside the United

Kingdom to countries not regarded by the United Kingdom as providing adequate protection (this means that personal data transfers from

the United Kingdom to the European Economic Area remain free flowing).

On July 12, 2016, the European

Commission adopted the EU-US Privacy Shield, a framework for the transfer of personal data from the European Union to the United States,

as a successor to the Safe Harbor framework that was invalidated by the European Court of Justice in October 2015.

On July 16, 2020, the

European Court of Justice invalidated the EU–US Privacy Shield ruling that it failed to offer adequate protections for European

Union personal data transferred to the United States.

The European Court of Justice, in the same decision, deemed that the Standard Contractual

Clauses (“SCCs”), approved by the European Commission for transfers of personal data between European Union controllers and

non-European Union processors are valid, however the European Court of Justice deemed that transfers made pursuant to the SCCs need to

be analyzed on a case-by-case basis to ensure the European Union’s standards of data protection are met.

Our customer agreements

include SCCs.

However, as a result of this decision, companies may be required to adopt additional measures to accomplish transfers of

personal data to the United States and other third countries in compliance with the GDPR, and there continue to be concerns about whether

the SCCs will face additional challenges.

Until the remaining legal uncertainties regarding how to legally continue these transfers are

settled, we will continue to face uncertainty as to whether our customers will be permitted to transfer personal data to the United States

for processing by us as part of our software services.

If such data transfer to the United States is not permitted, it could have a negative

effect on our existing business and on our ability to attract and retain new customers.

Our customers may view alternative data transfer

mechanisms as being too costly, too burdensome, too legally uncertain or otherwise objectionable and therefore decide not to do business

For example, some of our customers or potential customers who do business in the European Union may require their vendors to

host all personal data within the European Union and may decide to do business with one of our competitors who hosts personal data within

the European Union instead of doing business with us.

The regulatory framework governing

the collection, processing, storage, use and sharing of certain information, particularly financial and other personal information, is

rapidly evolving and is likely to continue to be subject to uncertainty and varying interpretations.

It is possible that these laws may

be interpreted and applied in a manner that is inconsistent with our existing data management practices or the features of our services

and software capabilities.

Any failure or perceived failure by us, or any third parties with which we do business, to comply with our

posted privacy policies, changing consumer expectations, evolving laws, rules and regulations, industry standards, or contractual obligations

to which we or such third parties are or may become subject, may result in actions or other claims against us by governmental entities

or private actors, the expenditure of substantial costs, time and other resources or the incurrence of significant fines, penalties or

other liabilities.

In addition, any such action, particularly to the extent we were found to be guilty of violations or otherwise liable

for damages, would damage our reputation and adversely affect our business, financial condition and results of operations.

We publicly post documentation

regarding our practices concerning the collection, processing, use and disclosure of data.

Although we endeavor to comply with our published

policies and documentation, we may at times fail to do so or be alleged to have failed to do so.

Any failure or perceived failure by us

to comply with our privacy policies or any applicable privacy, security or data protection, information security or consumer-protection

related laws, regulations, orders or industry standards could expose us to costly litigation, significant awards, fines or judgments,

civil and/or criminal penalties or negative publicity, and could materially and adversely affect our business, financial condition and

results of operations.

The publication of our privacy policy and other documentation that provide promises and assurances about privacy

and security can subject us to potential state and federal action if they are found to be deceptive, unfair, or misrepresentative of our

actual practices, which could, individually or in the aggregate, materially and adversely affect our business, financial condition and

results of operations.

If our privacy or data security

measures fail to comply with current or future laws and regulations, we may be subject to claims, legal proceedings or other actions by

individuals or governmental authorities based on privacy or data protection regulations and our commitments to customers or others, as

well as negative publicity and a potential loss of business.

Moreover, if future laws and regulations limit our subscribers’ ability

to use and share personal information or our ability to store, process and share personal information, demand for our solutions could

decrease, our costs could increase, and our business, results of operations and financial condition could be harmed.

We could face liability, or our reputation

might be harmed, as a result of the activities of our customers, the content of their websites or the data they store on our servers.

As a provider of a cloud-based

inbound marketing, content management, customer experience management, and robotic process automation software, we may be subject to potential

liability for the activities of our customers on or in connection with the data they store on our servers.

Although our customer terms

of use prohibit illegal use of our services by our customers and permit us to take down websites or take other appropriate actions for

illegal use, customers may nonetheless engage in prohibited activities or upload or store content with us in violation of applicable law

or the customer’s own policies, which could subject us to liability or harm our reputation.

Furthermore, customers may upload, store,

or use content on our software that may violate our policy on acceptable use which prohibits content that is threatening, abusive, harassing,

deceptive, false, misleading, vulgar, obscene, or indecent.

While such content may not be illegal, use of our software for such content

could harm our reputation resulting in a loss of business.

federal statutes

may apply to us with respect to various customer activities:

The Digital Millennium Copyright Act of 1998 (“DMCA”) provides recourse for owners of copyrighted material who believe that their rights under U.S.

Under the DMCA, based on our current business activity as an Internet service provider that does not own or control website content posted by our customers, we generally are not liable for infringing content posted by our customers or other third parties, provided that we follow the procedures for handling copyright infringement claims set forth in the DMCA.

Generally, if we receive a proper notice from, or on behalf, of a copyright owner alleging infringement of copyrighted material located on websites we host, and we fail to expeditiously remove or disable access to the allegedly infringing material or otherwise fail to meet the requirements of the safe harbor provided by the DMCA, the copyright owner may seek to impose liability on us.

Technical mistakes in complying with the detailed DMCA take-down procedures could subject us to liability for copyright infringement.

The Communications Decency Act of 1996 (the “CDA”) generally protects online service providers, such as us, from liability for certain activities of their customers, such as the posting of defamatory or obscene content, unless the online service provider is participating in the unlawful conduct.

Under the CDA, we are generally not responsible for the customer-created content hosted on our servers.

Consequently, we do not monitor hosted websites or prescreen the content placed by our customers on their sites.

However, the CDA does not apply in foreign jurisdictions and we may nonetheless be brought into disputes between our customers and third parties which would require us to devote management time and resources to resolve such matters and any publicity from such matters could also have an adverse effect on our reputation and therefore our business.

In addition to the CDA, the Securing the Protection of our Enduring and Established Constitutional Heritage Act (the “SPEECH Act”) provides a statutory exception to the enforcement by a U.S.

court of a foreign judgment for defamation under certain circumstances.

Generally, the exception applies if the defamation law applied in the foreign court did not provide at least as much protection for freedom of speech and press as would be provided by the First Amendment of the U.S.

Constitution or by the constitution and law of the state in which the U.S.

court is located, or if no finding of defamation would be supported under the First Amendment of the U.S.

Constitution or under the constitution and law of the state in which the U.S.

court is located.

Although the SPEECH Act may protect us from the enforcement of foreign judgments in the United States, it does not affect the enforceability of the judgment in the foreign country that issued the judgment.

Given our international presence, we may therefore, nonetheless, have to defend against or comply with any foreign judgments made against us, which could take up substantial management time and resources and damage our reputation.

In Japan, the statute which provides similar protection is the Provide Liability Limitation Act (the law No, 137 of 2001, as amended).

This law provides for the limitation of liability on Internet service providers and the rights of persons whose copyrights or privacy have been infringed or who were subject to defamation on the Internet, to request disclosure of relevant information on the sender of such infringing materials.

Under this law, based on our current business activity as an Internet service provider that does not own or control website content posted by our customers, we generally are not liable for infringing content posted by our customers or other third parties, provided that we meet the requirements under this law.

Although these statutes and

case law in the United States have generally shielded us from liability for customer activities to date, court rulings in pending or future

litigation may narrow the scope of protection afforded us under these laws.

In addition, laws governing these activities are unsettled

in many international jurisdictions, or may prove difficult or impossible for us to comply with in some international jurisdictions.

notwithstanding the exculpatory language of these bodies of law, we may become involved in complaints and lawsuits which, even if ultimately

resolved in our favor, add cost to our doing business and may divert management’s time and attention.

Finally, other existing bodies

of law, including the criminal laws of various states, may be deemed to apply or new statutes or regulations may be adopted in the future,

any of which could expose us to further liability and increase our costs of doing business.

The standards that private entities use

to regulate the use of email have in the past interfered with, and may in the future interfere with, the effectiveness of our software

and our ability to conduct business.

Our customers rely on email

to communicate with their existing or prospective customers.

Various private entities attempt to regulate the use of email for commercial

solicitation.

These entities often advocate standards of conduct or practice that significantly exceed current legal requirements and

classify certain email solicitations that comply with current legal requirements as spam.

Some of these entities maintain “blacklists”

of companies and individuals, and the websites, internet service providers and internet protocol addresses associated with those entities

or individuals that do not adhere to those standards of conduct or practices for commercial email solicitations that the blacklisting

entity believes are appropriate.

If a company’s internet protocol addresses are listed by a blacklisting entity, emails sent from

those addresses may be blocked if they are sent to any internet domain or internet address that subscribes to the blacklisting entity’s

service or purchases its blacklist.

From time to time, some of

our internet protocol addresses may become listed with one or more blacklisting entities due to the messaging practices of our customers.

There can be no guarantee that we will be able to successfully remove ourselves from those lists.

Blacklisting of this type could interfere

with our ability to market our software and services and communicate with our customers and, because we fulfill email delivery on behalf

of our customers, could undermine the effectiveness of our customers’ email marketing campaigns, all of which could have a material

negative impact on our business and results of operations.

Existing federal, state and foreign laws

regulate Internet tracking software, the senders of commercial emails and text messages, website owners and other activities, and could

impact the use of our software and potentially subject us to regulatory enforcement or private litigation.

Certain aspects of how our

customers utilize our software are subject to regulations in the United States, European Union and elsewhere.

In recent years, U.S.

European lawmakers and regulators have expressed concern over the use of third-party cookies or web beacons for online behavioral advertising,

and legislation adopted recently in the European Union requires informed consent for the placement of a cookie on a user’s device.

Regulation of cookies and web beacons may lead to restrictions on our activities, such as efforts to understand users’ Internet

New and expanding “Do Not Track” regulations have recently been enacted or proposed that protect users’ right

to choose whether or not to be tracked online.

These regulations seek, among other things, to allow end users to have greater control

over the use of private information collected online, to forbid the collection or use of online information, to demand a business to comply

with their choice to opt out of such collection or use, and to place limits upon the disclosure of information to third party websites.

These policies could have a significant impact on the operation of our software and could impair our attractiveness to customers, which

would harm our business.

Many of our customers and

potential customers in the healthcare, financial services and other industries are subject to substantial regulation regarding their collection,

use and protection of data and may be the subject of further regulation in the future.

Accordingly, these laws or significant new laws

or regulations or changes in, or repeals of, existing laws, regulations or governmental policy may change the way these customers do business

and may require us to implement additional features or offer additional contractual terms to satisfy customer and regulatory requirements,

or could cause the demand for and sales of our software to decrease and adversely impact our financial results.

In addition, the Controlling

the Assault of Non-Solicited Pornography and Marketing Act of 2003 (the “CAN-SPAM Act”) establishes certain requirements for

commercial email messages and specifies penalties for the transmission of commercial email messages that are intended to deceive the recipient

as to source or content.

The CAN-SPAM Act, among other things, obligates the sender of commercial emails to provide recipients with the

ability to opt out of receiving future commercial emails from the sender.

The ability of our customers’ message recipients to opt

out of receiving commercial emails may minimize the effectiveness of the email components of our software.

In addition, certain states

and foreign jurisdictions, such as Australia, Canada and the European Union, have enacted laws that regulate sending email, and some of

these laws are more restrictive than U.S.

For example, some foreign laws prohibit sending unsolicited email unless the recipient

has provided the sender advance consent to receipt of such email, or in other words has “opted-in” to receiving it.

A requirement

that recipients opt into, or the ability of recipients to opt out of, receiving commercial emails may minimize the effectiveness of our

While these laws and regulations

generally govern our customers’ use of our software, we may be subject to certain laws as a data processor on behalf of, or as a

business associate of, our customers.

For example, laws and regulations governing the collection, use and disclosure of personal information

include, in the United States, rules and regulations promulgated under the authority of the Federal Trade Commission, the Health Insurance

Portability and Accountability Act of 1996, the Gramm-Leach-Bliley Act of 1999 and state breach notification laws, and internationally,

the Data Protection Directive in the European Union and the Federal Data Protection Act in Germany.

If we were found to be in violation

of any of these laws or regulations as a result of government enforcement or private litigation, we could be subjected to civil and criminal

sanctions, including both monetary fines and injunctive action that could force us to change our business practices, all of which could

adversely affect our financial performance and significantly harm our reputation and our business.

We are subject to governmental export controls

and economic sanctions laws that could impair our ability to compete in international markets and subject us to liability if we are not

in full compliance with applicable laws.

Our business activities are

subject to various restrictions under U.S.

export controls and trade and economic sanctions laws, including the U.S.

Commerce Department’s

Export Administration Regulations and economic and trade sanctions regulations maintained by the U.S.

Treasury Department’s Office

of Foreign Assets Control.

If we fail to comply with these laws and regulations, we and certain of our employees could be subject to civil

or criminal penalties and reputational harm.

Obtaining the necessary authorizations, including any required license, for a particular

transaction may be time-consuming, is not guaranteed, and may result in the delay or loss of sales opportunities.

Furthermore, U.S.

control laws and economic sanctions laws prohibit certain transactions with U.S.

embargoed or sanctioned countries, governments, persons

and entities.

Although we take precautions to prevent transactions with U.S.

sanction targets, the possibility exists that we could inadvertently

provide our solutions to persons prohibited by U.S.

This could result in negative consequences to us, including government

investigations, penalties and reputational harm.

Risks Related to Taxation

We may be subject to additional obligations

to collect and remit sales tax and other taxes, and we may be subject to tax liability for past sales, which could harm our business.

State, local, and non-U.S.

jurisdictions have differing rules and regulations governing sales, use, value added, Digital Services Tax, and other taxes, and these

rules and regulations are subject to varying interpretations that may change over time.

In particular, the applicability of such taxes

to our software in various jurisdictions is unclear.

Further, these jurisdictions’ rules regarding tax nexus are complex and vary

significantly.

As a result, we could face the possibility of tax assessments and audits, and our liability for these taxes and associated

penalties could exceed our original estimates.

A successful assertion that we should be collecting additional sales, use, value added

or other taxes in those jurisdictions where we have not historically done so and do not accrue for such taxes could result in substantial

tax liabilities and related penalties for past sales, discourage customers from purchasing our application or otherwise harm our business

and operating results.

Changes in tax laws or regulations that

are applied adversely to us or our customers could increase the costs of our software and adversely impact our business.

New income, sales, use or

other tax laws, statutes, rules, regulations or ordinances could be enacted at any time.

Any new taxes could adversely affect our domestic

and international business operations, and our business and financial performance.

Further, existing tax laws, statutes, rules, regulations

or ordinances could be interpreted, changed, modified or applied adversely to us.

These events could require us or our customers to pay

additional tax amounts on a prospective or retroactive basis, as well as require us or our customers to pay fines and/or penalties and

interest for past amounts deemed to be due.

If we raise our prices to offset the costs of these changes, existing and potential future

customers may elect not to continue or purchase our software in the future.

Additionally, new, changed, modified or newly interpreted

or applied tax laws could increase our customers’ and our compliance, operating and other costs, as well as the costs of our software.

Any or all of these events could adversely impact our business and financial performance.

Furthermore, as our employees continue to work

remotely from geographic locations across the United States and internationally due to the pandemic and other reasons, we may become subject

to additional taxes and our compliance burdens with respect to the tax laws of additional jurisdictions may be increased.

We are a multinational organization faced

with increasingly complex tax issues in many jurisdictions, and we could be obligated to pay additional taxes in various jurisdictions.

As a multinational organization,

we may be subject to taxation in several jurisdictions around the world with increasingly complex tax laws, the application of which can

be uncertain.

The amount of taxes we pay in these jurisdictions could increase substantially as a result of changes in the applicable

tax principles, including increased tax rates, new tax laws or revised interpretations of existing tax laws and precedents, which could

have a material adverse effect on our liquidity and operating results.

In addition, the authorities in these jurisdictions could review

our tax returns and impose additional tax, interest and penalties, and the authorities could claim that various withholding requirements

apply to us or our subsidiary or assert that benefits of tax treaties are not available to us or our subsidiary, any of which could have

a material impact on us and the results of our operations.

Related to Ownership of Our Common Stock

There can be no assurance that we will be

able to comply with Nasdaq Capital Market’s continued listing standards.

Our common stock is listed

on Nasdaq Capital Market under the symbol “HTCR.” There can be no assurance any broker will continue to be interested in trading

Therefore, it may be difficult to sell your shares of common stock if you desire or need to sell them.

We cannot provide any

assurance that an active and liquid trading market in our common stock will develop or, if developed, that such market will continue.

There is no guarantee that

we will be able to maintain a listing on the Nasdaq Capital Market for any period of time by perpetually satisfying Nasdaq’s continued

listing requirements.

Our failure to continue to meet these requirements may result in our common stock being delisted from Nasdaq Capital

The market price of our common stock may

be volatile, and you could lose all or part of your investment.

We cannot predict the prices

at which our common stock will trade.

The market price of our common stock depends on a number of factors, including those described in

this “Risk Factors” section, many of which are beyond our control and may not be related to our operating performance.

addition, the limited public float of our common stock will tend to increase the volatility of the trading price of our common stock.

These fluctuations could cause you to lose all or part of your investment in our common stock, since you might not be able to sell your

shares at or above the price you paid for them.

Factors that could cause fluctuations in the market price of our common stock include,

but are not limited to, the following:

actual or anticipated changes or fluctuations in our results of operations;

the financial projections we may provide to the public, any changes in these projections, or our failure to meet these projections;

announcements by us or our competitors of new products or new or terminated significant contracts, commercial relationships, or capital commitments;

industry or financial analyst or investor reaction to our press releases, other public announcements, and filings with the SEC;

rumors and market speculation involving us or other companies in our industry;

price and volume fluctuations in the overall stock market from time to time;

changes in operating performance and stock market valuations of other technology companies generally, or those in our industry in particular;

the expiration of market stand-off or contractual lock-up agreements and sales of shares of our common stock by us or our stockholders;

failure of industry or financial analysts to maintain coverage of us, changes in financial estimates by any analysts who follow our company, or our failure to meet these estimates or the expectations of investors;

actual or anticipated developments in our business, or our competitors’ businesses, or the competitive landscape generally;

litigation involving us, our industry, or both, or investigations by regulators into our operations or those of our competitors;

developments or disputes concerning our intellectual property rights, our products, or third-party proprietary rights;

announced or completed acquisitions of businesses or technologies by us or our competitors;

new laws or regulations or new interpretations of existing laws or regulations applicable to our business;

any major changes in our management or our board of directors, particularly with respect to Mr.

general economic conditions and slow or negative growth of our markets;

other events or factors, including those resulting from war, incidents of terrorism, or responses to these events.

In addition, the stock market

in general has experienced extreme price and volume fluctuations that have often been unrelated or disproportionate to the operating performance

of companies.

Broad market and industry factors may seriously affect the market price of our common stock, regardless of our actual operating

In addition, in the past, following periods of volatility in the overall market and the market prices of a particular company’s

securities, securities class action litigation has often been instituted against that company.

Securities litigation, if instituted against

us, could result in substantial costs and divert our management’s attention and resources from our business.

This could materially

adversely affect our business, financial condition, results of operations, and prospects.

Our common stock may be subject to the “penny

stock” rules in the future.

It may be more difficult to resell securities classified as “penny stock.”

Our common stock may be subject

to “penny stock” rules (generally defined as non-exchange traded stock with a per-share price below $5.00) in the future.

While our common stock is not currently considered “penny stock” since it is listed on Nasdaq, if we are unable to maintain

that listing and our common stock is no longer listed on Nasdaq, unless we maintain a per-share price above $5.00, our common stock will

become “penny stock.” These rules impose additional sales practice requirements on broker-dealers that recommend the purchase

or sale of penny stocks to persons other than those who qualify as “established customers” or “accredited investors.”

For example, broker-dealers must determine the appropriateness for non-qualifying persons of investments in penny stocks.

Broker-dealers

must also provide, prior to a transaction in a penny stock not otherwise exempt from the rules, a standardized risk disclosure document

that provides information about penny stocks and the risks in the penny stock market.

The broker-dealer also must provide the customer

with current bid and offer quotations for the penny stock, disclose the compensation of the broker-dealer and its salesperson in the transaction,

furnish monthly account statements showing the market value of each penny stock held in the customer’s account, provide a special

written determination that the penny stock is a suitable investment for the purchaser, and receive the purchaser’s written agreement

to the transaction.

Legal remedies available to

an investor in “penny stocks” may include the following:

● If a “penny stock” is sold to the investor in violation

of the requirements listed above, or other federal or states securities laws, the investor may be able to cancel the purchase and receive

a refund of the investment.

● If a “penny stock” is sold to the investor in a

fraudulent manner, the investor may be able to sue the persons and firms that committed the fraud for damages.

These requirements may have

the effect of reducing the level of trading activity, if any, in the secondary market for a security that becomes subject to the penny

The additional burdens imposed upon broker-dealers by such requirements may discourage broker-dealers from effecting transactions

in our securities, which could severely limit the market price and liquidity of our securities.

These requirements may restrict the ability

of broker-dealers to sell our common stock and may affect your ability to resell our common stock.

Many brokerage firms will

discourage or refrain from recommending investments in penny stocks.

Most institutional investors will not invest in penny stocks.

addition, many individual investors will not invest in penny stocks due, among other reasons, to the increased financial risk generally

associated with these investments.

For these reasons, penny stocks

may have a limited market and, consequently, limited liquidity.

We can give no assurance at what time, if ever, our common stock will

not be classified as a “penny stock” in the future.

If the benefits of any proposed acquisition

do not meet the expectations of investors, stockholders or financial analysts, the market price of our common stock may decline.

If the benefits of any proposed

acquisition do not meet the expectations of investors or securities analysts, the market price of our common stock prior to the closing

of the proposed acquisition may decline.

The market values of our common stock at the time of the proposed acquisition may vary significantly

from their prices on the date the acquisition target was identified.

In addition, broad market

and industry factors may materially harm the market price of our common stock irrespective of our operating performance.

The stock market

in general has experienced price and volume fluctuations that have often been unrelated or disproportionate to the operating performance

of the particular companies affected.

The trading prices and valuations of these stocks, and of our securities, may not be predictable.

A loss of investor confidence in the market for retail stocks or the stocks of other companies which investors perceive to be similar

to us could depress our stock price regardless of our business, prospects, financial conditions or results of operations.

the market price of our securities also could adversely affect our ability to issue additional securities and our ability to obtain additional

financing in the future.

As an “emerging growth company”

under the JOBS Act, we are permitted to rely on exemptions from certain disclosure requirements.

We qualify as an “emerging

growth company” under the JOBS Act.

As a result, we are permitted to, and intend to, rely on exemptions from certain disclosure

requirements.

failure to attract and retain additional qualified personnel could prevent us from executing our business strategy.

execute our business strategy, we must attract and retain highly qualified personnel.

We have from time to time in the past experienced,

and we expect to continue to experience in the future, difficulty in hiring and difficulty in retaining employees with appropriate qualifications.

In particular, we have experienced a competitive hiring environment in Japan, where we are headquartered, and expect to continue to experience

a competitive hiring environment.

If we fail to attract new personnel or fail to retain and motivate our current personnel, our growth

prospects could be severely harmed.

to Ownership of Our Common Stock

can be no assurance that we will be able to comply with Nasdaq Capital Market’s continued listing standards.

common stock is listed on Nasdaq Capital Market under the symbol “HTCR.” There can be no assurance any broker will continue

to be interested in trading our stock.

Therefore, it may be difficult to sell your shares of common stock if you desire or need to sell

We cannot provide any assurance that an active and liquid trading market in our common stock will develop or, if developed, that

such market will continue.

is no guarantee that we will be able to maintain a listing on the Nasdaq Capital Market for any period of time by perpetually satisfying

Nasdaq’s continued listing requirements.

Our failure to continue to meet these requirements may result in our common stock being

delisted from Nasdaq Capital Market.

market price of our common stock may be volatile, and you could lose all or part of your investment.

cannot predict the prices at which our common stock will trade.

The market price of our common stock depends on a number of factors,

including those described in this “Risk Factors” section, many of which are beyond our control and may not be related to

our operating performance.

In addition, the limited public float of our common stock will tend to increase the volatility of the trading

price of our common stock.

These fluctuations could cause you to lose all or part of your investment in our common stock, since you might

not be able to sell your shares at or above the price you paid for them.

Factors that could cause fluctuations in the market price of

our common stock include, but are not limited to, the following:

or anticipated changes or fluctuations in our results of operations;

financial projections we may provide to the public, any changes in these projections, or our failure to meet these projections;

announcements

by us of new consulting agreements or capital commitments;

or financial analyst or investor reaction to our press releases, other public announcements, and filings with the SEC;

and market speculation involving us;

and volume fluctuations in the overall stock market from time to time;

expiration of market stand-off or contractual lock-up agreements and sales of shares of our common stock by us or our stockholders;

of industry or financial analysts to maintain coverage of us, changes in financial estimates by any analysts who follow our company,

or our failure to meet these estimates or the expectations of investors;

or anticipated developments in our business, or our competitors’ businesses, or the competitive landscape generally;

involving us, our industry, or both, or investigations by regulators into our operations or those of our competitors;

or completed acquisitions of businesses by us or our competitors;

laws or regulations or new interpretations of existing laws or regulations applicable to our business;

major changes in our management or our board of directors, particularly with respect to Mr.

economic conditions and slow or negative growth of our markets;

events or factors, including those resulting from war, incidents of terrorism, or responses to these events.

addition, the stock market in general has experienced extreme price and volume fluctuations that have often been unrelated or disproportionate

to the operating performance of companies.

Broad market and industry factors may seriously affect the market price of our common stock,

regardless of our actual operating performance.

In addition, in the past, following periods of volatility in the overall market and the

market prices of a particular company’s securities, securities class action litigation has often been instituted against that company.

Securities litigation, if instituted against us, could result in substantial costs and divert our management’s attention and resources

from our business.

This could materially adversely affect our business, financial condition, results of operations, and prospects.

common stock may be subject to the “penny stock” rules in the future.

It may be more difficult to resell securities classified

as “penny stock.”

common stock may be subject to “penny stock” rules (generally defined as non-exchange traded stock with a per-share price

below $5.00) in the future.

While our common stock is not currently considered “penny stock” since it is listed on Nasdaq,

if we are unable to maintain that listing and our common stock is no longer listed on Nasdaq, unless we maintain a per-share price above

$5.00, our common stock will become “penny stock.” These rules impose additional sales practice requirements on broker-dealers

that recommend the purchase or sale of penny stocks to persons other than those who qualify as “established customers” or

“accredited investors.” For example, broker-dealers must determine the appropriateness for non-qualifying persons of investments

in penny stocks.

Broker-dealers must also provide, prior to a transaction in a penny stock not otherwise exempt from the rules, a standardized

risk disclosure document that provides information about penny stocks and the risks in the penny stock market.

The broker-dealer also

must provide the customer with current bid and offer quotations for the penny stock, disclose the compensation of the broker-dealer and

its salesperson in the transaction, furnish monthly account statements showing the market value of each penny stock held in the customer’s

account, provide a special written determination that the penny stock is a suitable investment for the purchaser, and receive the purchaser’s

written agreement to the transaction.

remedies available to an investor in “penny stocks” may include the following:

a “penny stock” is sold to the investor in violation of the requirements listed above, or other federal or states securities

laws, the investor may be able to cancel the purchase and receive a refund of the investment.

a “penny stock” is sold to the investor in a fraudulent manner, the investor may be able to sue the persons and firms

that committed the fraud for damages.

requirements may have the effect of reducing the level of trading activity, if any, in the secondary market for a security that becomes

subject to the penny stock rules.

The additional burdens imposed upon broker-dealers by such requirements may discourage broker-dealers

from effecting transactions in our securities, which could severely limit the market price and liquidity of our securities.

These requirements

may restrict the ability of broker-dealers to sell our common stock and may affect your ability to resell our common stock.

brokerage firms will discourage or refrain from recommending investments in penny stocks.

Most institutional investors will not invest

in penny stocks.

In addition, many individual investors will not invest in penny stocks due, among other reasons, to the increased financial

risk generally associated with these investments.

these reasons, penny stocks may have a limited market and, consequently, limited liquidity.

We can give no assurance at what time, if

ever, our common stock will not be classified as a “penny stock” in the future.

an “emerging growth company” under the JOBS Act, we are permitted to rely on exemptions from certain disclosure requirements.

qualify as an “emerging growth company” under the JOBS Act.

As a result, we are permitted to, and intend to, rely on exemptions

from certain disclosure requirements.

For so long as we are an emerging growth company, we will not be required to:

have an auditor report on our internal control over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act;

comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditors’ report providing additional information about the audit and the consolidated financial statements (i.e., an auditor discussion and analysis);

submit certain executive compensation matters to stockholder advisory votes, such as “say-on-pay” and “say-on-frequency”;

disclose certain executive compensation related items such as the correlation between executive compensation and performance and comparisons of the chief executive officer’s compensation to median employee compensation.

In addition, Section 102 of

the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period provided in Section 7(a)(2)(B)

of the Securities Act for complying with new or revised accounting standards.

In other words, an emerging growth company can delay the

adoption of certain accounting standards until those standards would otherwise apply to private companies.

We have elected to take advantage

of the benefits of this extended transition period.

Our consolidated financial statements may therefore not be comparable to those of

companies that comply with such new or revised accounting standards.

We will remain an emerging

growth company until the earliest to occur of:

(i) the end of the first fiscal year in which our annual gross revenue is $1.07 billion

(ii) the end of the fiscal year in which the market value of our common shares that are held by non-affiliates is at least $700.0

million as of the last business day of our most recently completed second fiscal quarter;

(iii) the date on which we have, during the

previous three-year period, issued more than $1.0 billion in non-convertible debt;

and (iv) the end of the fiscal year during which the

fifth anniversary of our initial public offering (which closed on February 14, 2022) occurs.

Until such time, however,

we cannot predict if investors will find our securities less attractive because we may rely on these exemptions.

If some investors find

our securities less attractive as a result, there may be a less active trading market for our securities and the price of our securities

may be more volatile.

If we are unable to implement and maintain

effective internal control over financial reporting in the future, investors may lose confidence in the accuracy and completeness of our

financial reports and have an adverse effect on the value of our securities.

As a public company, we are

required to maintain internal control over financial reporting and to report any material weaknesses in such internal control.

we will be required to report any changes in internal controls on a quarterly basis.

In addition, we are required to furnish a report

by management on the effectiveness of internal control over financial reporting pursuant to Section 404 of the Sarbanes-Oxley Act.

will design, implement, and test the internal control over financial reporting required to comply with these obligations.

If we identify

material weaknesses in our internal control over financial reporting, if we are unable to comply with the requirements of Section 404

in a timely manner or assert that our internal control over financial reporting is effective, or if our independent registered public

accounting firm is unable to express an opinion as to the effectiveness of its internal control over financial reporting when required,

investors may lose confidence in the accuracy and completeness of our financial reports and the value of our securities could be negatively

We also could become subject to investigations by the SEC or other regulatory authorities, which could require additional financial

and management resources.

As an emerging growth company, our auditor

is not required to attest to the effectiveness of our internal controls.

Our independent registered

public accounting firm is not required to attest to the effectiveness of our internal control over financial reporting while we are an

emerging growth company.

This means that the effectiveness of our financial operations may differ from our peer companies in that they

may be required to obtain independent registered public accounting firm attestations as to the effectiveness of their internal controls

over financial reporting and we are not.

While our management will be required to attest to internal control over financial reporting

and we will be required to detail changes to our internal controls on a quarterly basis, we cannot provide assurance that the independent

registered public accounting firm’s review process in assessing the effectiveness of our internal controls over financial reporting,

if obtained, would not find one or more material weaknesses or significant deficiencies.

Further, once we cease to be an emerging growth

company and cease to be a smaller reporting company (as described below), we will be subject to independent registered public accounting

firm attestation regarding the effectiveness of our internal controls over financial reporting.

Even if management finds such controls

to be effective, our independent registered public accounting firm may decline to attest to the effectiveness of such internal controls

and issue a qualified report.

We believe we will be considered a smaller

reporting company and will be exempt from certain disclosure requirements, which could make our common stock less attractive to potential

Rule 12b-2 of the Exchange

Act defines a “smaller reporting company” as an issuer that is not an investment company, an asset-backed issuer, or a majority-owned

subsidiary of a parent that is not a smaller reporting company and that:

had a public float of less than $250 million as of the last business day of its most recently completed second fiscal quarter, computed by multiplying the aggregate worldwide number of shares of its voting and non-voting common equity held by non-affiliates by the price at which the common equity was last sold, or the average of the bid and asked prices of common equity, in the principal market for the common equity;

in the case of an initial registration statement under the Securities Act or the Exchange Act for shares of its common equity, had a public float of less than $250 million as of a date within 30 days of the date of the filing of the registration statement, computed by multiplying the aggregate worldwide number of such shares held by non-affiliates before the registration plus, in the case of a Securities Act registration statement, the number of such shares included in the registration statement by the estimated public offering price of the shares;

in the case of an issuer whose public float as calculated under paragraph (1) or (2) of this definition was zero or whose public float was less than $700 million, had annual revenues of less than $100 million during the most recently completed fiscal year for which audited financial statements are available.

As a smaller reporting company,

we are not be required to, and may not, include a Compensation Discussion and Analysis section in our proxy statements;

we will provide

only two years of financial statements;

and we need not provide the table of selected financial data.

We also will have other “scaled”

disclosure requirements that are less comprehensive than issuers that are not smaller reporting companies which could make our common

stock less attractive to potential investors, which could make it more difficult for our stockholders to sell their shares.

We incur significant costs as a result of

operating as a public company, and our management is required to devote substantial time to new compliance initiatives.

As a public company, we incur

significant legal, accounting and other expenses that we did not previously incur as a private company.

In addition, the Sarbanes-Oxley

Act has imposed various requirements on public companies, including requiring establishment and maintenance of effective disclosure and

financial controls.

Our management and other personnel need to devote a substantial amount of time to these compliance initiatives.

these rules and regulations have increased and will continue to increase our legal and financial compliance costs and will make some activities

more time-consuming and costly.

We cannot predict or estimate the amount of additional costs we will incur as a public company or the

timing of such costs.

The Sarbanes-Oxley Act requires,

among other things, that we maintain effective internal control over financial reporting and disclosure controls and procedures.

In particular,

we must perform system and process evaluation and testing of our internal control over financial reporting to allow management to report

on the effectiveness of our internal control over financial reporting, as required by Section 404 of the Sarbanes-Oxley Act.

will be required to have our independent registered public accounting firm attest to the effectiveness of our internal control over financial

reporting the later of our second annual report on Form 10-K or the first annual report on Form 10-K following the date on which we are

no longer an emerging growth company or a smaller reporting company.

Our compliance with Section 404 of the Sarbanes-Oxley Act will require

that we incur substantial accounting expense and expend significant management efforts.

We currently do not have an internal audit group,

and we will need to hire additional accounting and financial staff with appropriate public company experience and technical accounting

If we are not able to comply with the requirements of Section 404 in a timely manner, or if we or our independent registered

public accounting firm identify deficiencies in our internal control over financial reporting that are deemed to be material weaknesses,

the value of our securities could decline and we could be subject to sanctions or investigations by the SEC or other regulatory authorities,

which would require additional financial and management resources.

Our ability to successfully

implement our business plan and comply with Section 404 requires us to be able to prepare timely and accurate financial statements.

expect that we will need to continue to improve existing, and implement new operational and financial systems, procedures and controls

to manage our business effectively.

Any delay in the implementation of, or disruption in the transition to, new or enhanced systems, procedures

or controls, may cause our operations to suffer and we may be unable to conclude that our internal control over financial reporting is

effective and to obtain an unqualified report on internal controls from our auditors as required under Section 404 of the Sarbanes-Oxley

This, in turn, could have an adverse impact on value of our securities, and could adversely affect our ability to access the capital

Anti-takeover provisions contained in our

certificate of incorporation and bylaws, as well as provisions of Delaware law, could impair a takeover attempt.

The Company’s certificate

of incorporation and bylaws contain provisions that could have the effect of delaying or preventing changes in control or changes in our

management without the consent of our board of directors.

an auditor report on our internal control over financial reporting pursuant to Section 404(b) of the Sarbanes-Oxley Act;

with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation

or a supplement to the auditors’ report providing additional information about the audit and the consolidated financial statements

(i.e., an auditor discussion and analysis);

certain executive compensation matters to stockholder advisory votes, such as “say-on-pay” and “say-on-frequency”;

certain executive compensation related items such as the correlation between executive compensation and performance and comparisons

of the chief executive officer’s compensation to median employee compensation.

addition, Section 102 of the JOBS Act also provides that an emerging growth company can take advantage of the extended transition period

provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards.

In other words, an emerging

growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies.

We have elected to take advantage of the benefits of this extended transition period.

Our consolidated financial statements may therefore

not be comparable to those of companies that comply with such new or revised accounting standards.

will remain an emerging growth company until the earliest to occur of:

(i) the end of the first fiscal year in which our annual gross

revenue is $1.235 billion or more;

(ii) the end of the fiscal year in which the market value of our common shares that are held by non-affiliates

is at least $700.0 million as of the last business day of our most recently completed second fiscal quarter;

(iii) the date on which

we have, during the previous three-year period, issued more than $1.0 billion in non-convertible debt;

and (iv) the end of the fiscal

year during which the fifth anniversary of our initial public offering (which closed on February 14, 2022) occurs.

such time, however, we cannot predict if investors will find our securities less attractive because we may rely on these exemptions.

If some investors find our securities less attractive as a result, there may be a less active trading market for our securities and the

price of our securities may be more volatile.

we are unable to implement and maintain effective internal control over financial reporting in the future, investors may lose confidence

in the accuracy and completeness of our financial reports and have an adverse effect on the value of our securities.

a public company, we are required to maintain internal control over financial reporting and to report any material weaknesses in such

internal control.

Further, we will be required to report any changes in internal controls on a quarterly basis.

In addition, we are required

to furnish a report by management on the effectiveness of internal control over financial reporting pursuant to Section 404 of the Sarbanes-Oxley

We design, implement, and test internal control over financial reporting to comply with these obligations.

If we identify material

weaknesses in our internal control over financial reporting, if we are unable to comply with the requirements of Section 404 in a timely

manner or assert that our internal control over financial reporting is effective, or if our independent registered public accounting

firm is unable to express an opinion as to the effectiveness of its internal control over financial reporting when required, investors

may lose confidence in the accuracy and completeness of our financial reports and the value of our securities could be negatively affected.

We also could become subject to investigations by the SEC or other regulatory authorities, which could require additional financial and

management resources.

an emerging growth company, our auditor is not required to attest to the effectiveness of our internal controls.

independent registered public accounting firm is not required to attest to the effectiveness of our internal control over financial reporting

while we are an emerging growth company.

This means that the effectiveness of our internal control over financial reporting may differ

from our peer companies in that they may be required to obtain independent registered public accounting firm attestations as to the effectiveness

of their internal control over financial reporting and we are not.

While our management is required to attest to internal control over

financial reporting and we are required to detail changes to our internal controls on a quarterly basis, we cannot provide assurance

that the independent registered public accounting firm’s review process in assessing the effectiveness of our internal control

over financial reporting, if obtained, would not find one or more material weaknesses or significant deficiencies.

Further, once we cease

to be an emerging growth company and cease to be a smaller reporting company (as described below), we will be subject to independent

registered public accounting firm attestation regarding the effectiveness of our internal control over financial reporting.

Even if management

finds such controls to be effective, our independent registered public accounting firm may decline to attest to the effectiveness of

such internal controls and issue a qualified report.

are a smaller reporting company and are, therefore, exempt from certain disclosure requirements, which could make our common stock less

attractive to potential investors.

12b-2 of the Exchange Act defines a “smaller reporting company” as an issuer that is not an investment company, an asset-backed

issuer, or a majority-owned subsidiary of a parent that is not a smaller reporting company and that:

a public float of less than $250 million as of the last business day of its most recently completed second fiscal quarter, computed

by multiplying the aggregate worldwide number of shares of its voting and non-voting common equity held by non-affiliates by the

price at which the common equity was last sold, or the average of the bid and asked prices of common equity, in the principal market

for the common equity;

the case of an initial registration statement under the Securities Act or the Exchange Act for shares of its common equity, had a

public float of less than $250 million as of a date within 30 days of the date of the filing of the registration statement, computed

by multiplying the aggregate worldwide number of such shares held by non-affiliates before the registration plus, in the case of

a Securities Act registration statement, the number of such shares included in the registration statement by the estimated public

offering price of the shares;

the case of an issuer whose public float as calculated under paragraph (1) or (2) of this definition was zero or whose public float

was less than $700 million, had annual revenues of less than $100 million during the most recently completed fiscal year for which

audited financial statements are available.

a smaller reporting company, we are not required to include a Compensation Discussion and Analysis section in our proxy statements;

provide only two years of financial statements;

and we are not required to provide the table of selected financial data.

other “scaled” disclosure requirements that are less comprehensive than issuers that are not smaller reporting companies,

which could make our common stock less attractive to potential investors, and which could make it more difficult for our stockholders

to sell their shares.

incur significant costs as a result of operating as a public company, and our management is required to devote substantial time to compliance

a public company, we incur significant legal, accounting and other expenses.

In addition, the Sarbanes-Oxley Act imposes various requirements

on public companies, including requiring establishment and maintenance of effective disclosure and financial controls.

Our management

and other personnel need to devote a substantial amount of time to these compliance initiatives.

Moreover, these rules and regulations

increase our legal and financial compliance costs and will make some activities more time-consuming and costly.

Sarbanes-Oxley Act requires, among other things, that we maintain effective internal control over financial reporting and disclosure

controls and procedures.

In particular, we must perform system and process evaluation and testing of our internal control over financial

reporting to allow management to report on the effectiveness of our internal control over financial reporting, as required by Section

404 of the Sarbanes-Oxley Act.

In addition, we will be required to have our independent registered public accounting firm attest to the

effectiveness of our internal control over financial reporting on the later of our second annual report on Form 10-K or the first annual

report on Form 10-K following the date on which we are no longer an emerging growth company or a smaller reporting company.

Our compliance

with Section 404 of the Sarbanes-Oxley Act will require that we incur substantial accounting expense and expend significant management

We currently do not have an internal audit group, and we will need to hire additional accounting and financial staff with appropriate

public company experience and technical accounting knowledge.

If we are not able to comply with the requirements of Section 404 in a

timely manner, or if we or our independent registered public accounting firm identify deficiencies in our internal control over financial

reporting that are deemed to be material weaknesses, the value of our securities could decline and we could be subject to sanctions or

investigations by the SEC or other regulatory authorities, which would require additional financial and management resources.

ability to successfully implement our business plan and comply with Section 404 requires us to be able to prepare timely and accurate

financial statements.

We expect that we will need to continue to improve existing, and implement new operational and financial systems,

procedures and controls to manage our business effectively.

Any delay in the implementation of, or disruption in the transition to, new

or enhanced systems, procedures or controls, may cause our operations to suffer and we may be unable to conclude that our internal control

over financial reporting is effective and to obtain an unqualified report on internal controls from our auditors as required under Section

404 of the Sarbanes-Oxley Act.

This, in turn, could have an adverse impact on value of our securities, and could adversely affect our

ability to access the capital markets.

Anti-takeover

provisions contained in our Certificate of Incorporation and bylaws, as well as provisions of Delaware law, could impair a takeover attempt.

Company’s Certificate of Incorporation and bylaws contain provisions that could have the effect of delaying or preventing changes

in control or changes in our management without the consent of our board of directors.

These provisions include:

no cumulative voting in the election of directors, which limits the ability of minority stockholders to elect director candidates;

the exclusive right of our board of directors to elect a director to fill a vacancy created by the expansion of the board of directors or the resignation, death, or removal of a director, which prevents stockholders from being able to fill vacancies on our board of directors;

the ability of our board of directors to determine whether to issue shares of our preferred stock and to determine the price and other terms of those shares, including preferences and voting rights, without stockholder approval, which could be used to significantly dilute the ownership of a hostile acquirer;

limiting the liability of, and providing indemnification to, our directors and officers;

providing that a special meeting of the stockholders may only be called by a majority of the board of directors;

providing that directors may be removed prior to the expiration of their terms by the affirmative vote of the holders of not less than 2/3 of the voting power of the issued and outstanding stock entitled to vote;

advance notice procedures that stockholders must comply with in order to nominate candidates to our board of directors or to propose matters to be acted upon at a stockholders’ meeting, which may discourage or deter a potential acquirer from conducting a solicitation of proxies to elect the acquirer’s own slate of directors or otherwise attempting to obtain control of the Company.

These provisions, alone or

together, could delay hostile takeovers and changes in control of the Company or changes in our board of directors and management.

Any provision of our certificate

of incorporation or bylaws or Delaware law that has the effect of delaying or deterring a change in control could limit the opportunity

for our security holders to receive a premium for their securities and could also affect the price that some investors are willing to

pay for our securities.

cumulative voting in the election of directors, which limits the ability of minority stockholders to elect director candidates;

exclusive right of our board of directors to elect a director to fill a vacancy created by the expansion of the board of directors

or the resignation, death, or removal of a director, which prevents stockholders from being able to fill vacancies on our board of

ability of our board of directors to determine whether to issue shares of our preferred stock and to determine the price and other

terms of those shares, including preferences and voting rights, without stockholder approval, which could be used to significantly

dilute the ownership of a hostile acquirer;

the liability of, and providing indemnification to, our directors and officers;

that a special meeting of the stockholders may only be called by a majority of the board of directors;

that directors may be removed prior to the expiration of their terms by the affirmative vote of the holders of not less than 2/3

of the voting power of the issued and outstanding stock entitled to vote;

notice procedures that stockholders must comply with in order to nominate candidates to our board of directors or to propose matters

to be acted upon at a stockholders’ meeting, which may discourage or deter a potential acquirer from conducting a solicitation

of proxies to elect the acquirer’s own slate of directors or otherwise attempting to obtain control of the Company.

provisions, alone or together, could delay hostile takeovers and changes in control of the Company or changes in our board of directors

and management.

provision of our Certificate of Incorporation or bylaws or Delaware law that has the effect of delaying or deterring a change in control

could limit the opportunity for our security holders to receive a premium for their securities and could also affect the price that some

investors are willing to pay for our securities.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors