ILLR filing — read by section

Item 1A. Risk Factors

ITEM 1A. RISK FACTORS 
 
 Risk Factors Relating to AGBA’s Hong Kong
Operations and Proximity to the PRC 
 
 The business, financial condition, results
of operations, and prospects of AGBA may be materially and adversely affected if certain laws and regulations of the PRC become applicable
to AGBA or its subsidiaries. AGBA may be subject to the risks and uncertainties associated with the evolving laws and regulations in
the PRC, their interpretation and implementation, and the legal and regulatory system in the PRC more generally, including with respect
to the enforcement of laws and the possibility of changes of rules and regulations with little or no advance notice. 
 
 We currently do not have operations in mainland
China. Although we do service Chinese clients, all sales of financial products offered by us occur in Hong Kong. We do not sell
any financial products in mainland China, and all of our customer data is maintained outside of mainland China. Accordingly, none of
us are regulated by any regulatory authorities in mainland China. Pursuant to the Basic Law of the Hong Kong Special Administrative
Region (the “Basic Law”), which is a national law of the PRC and the constitutional document for Hong Kong, national
laws of the PRC shall not be applied in Hong Kong except for those listed in Annex III of the Basic Law and applied locally
by promulgation or local legislation. The Basic Law expressly provides that the national laws of the PRC which may be listed in Annex III
of the Basic Law shall be confined to those relating to defense and foreign affairs as well as other matters outside the autonomy of
Hong Kong. While the National People’s Congress of the PRC has the power to amend the Basic Law, the Basic Law also expressly
provides that no amendment to the Basic Law shall contravene the established basic policies of the PRC regarding Hong Kong. As a result,
national laws of the PRC not listed in Annex III of the Basic Law do not apply to Hong Kong-based businesses.
 
 However, the laws and regulations in the PRC
are evolving, and their enactment timetable, interpretation, and implementation involve significant uncertainties. To the extent that
any PRC laws and regulations become applicable to us, we may be subject to the risks and uncertainties associated with the evolving laws
and regulations of the PRC, their interpretation and implementation, and the legal and regulatory system in the PRC more generally, including
with respect to the enforcement of laws and the possibility of changes of rules and regulations with little or no advance notice. If
certain PRC laws and regulations, including existing laws and regulations and those enacted or promulgated in the future, were to become
applicable to companies such as AGBA or its subsidiaries in the future, the application of such laws and regulations may have a material
adverse impact on the business, financial condition, results of operations, and prospects of AGBA and its ability to offer securities
to investors, any of which may, in turn, cause the value of our securities to significantly decline or become worthless.
 
 Relevant organs of the PRC government have made
recent statements or recently taken regulatory actions related to data security, anti-monopoly, and overseas listings of mainland China
businesses. For example, in addition to the PRC Data Security Law and the Measures for Cybersecurity Review issued by the Cyberspace
Administration of China which became effective on February 15, 2022 (the “Measures”), relevant PRC government agencies
have recently taken anti-trust enforcement action against certain mainland China-based businesses. Our management understands
that such enforcement action was taken pursuant to the PRC Anti-Monopoly Law which applies to monopolistic activities in domestic
economic activities in mainland China and monopolistic activities outside mainland China which eliminate or restrict market competition
in mainland China. In addition, in July 2021, the PRC government provided new guidance on PRC-based companies raising capital
outside of the PRC, including through arrangements called variable interest entities (“VIEs”). In light of such developments,
the SEC has imposed enhanced disclosure requirements on China-based companies seeking to register securities with the SEC.
 
 While we currently do not have any operations
in mainland China, there is no guarantee that the recent statements or regulatory actions by the relevant organs of the PRC government,
including statements relating to the PRC Data Security Law, the PRC Personal Information Protection Law, and VIEs as well as the anti-monopoly enforcement
actions will continue not to apply to AGBA. Should such statements or regulatory actions apply to companies such as AGBA or its
subsidiaries in the future, it could have a material adverse impact on the business, financial condition, results of operations, and
prospects of AGBA, our ability to accept foreign investments, and our ability to offer or continue to offer securities to investors on
a U.S. or other international securities exchange, any of which may, in turn, cause the value of our securities to significantly
decline or become worthless. We cannot predict the extent of such impact if such events were to occur.
 
 AGBA may also become subject to the laws and
regulations of the PRC to the extent that we commence business and customer facing operations in mainland China as a result of any future
partnership, acquisition, expansion, or organic growth.
 
 10 

 The PRC government exerts substantial influence,
discretion, oversight, and control over the manner in which companies incorporated under the laws of PRC must conduct their business
activities. AGBA is a Hong Kong-based company with no operations in mainland China; however, there can be no guarantee that
the PRC government will not seek to intervene or influence our operations at any time. 
 
 Because (i) we currently do not have operations
in mainland China, (ii) all sales of financial products offered by us, including those to PRC citizens, occur in Hong Kong,
and (iii) we do not sell any financial products in mainland China, the PRC government currently does not directly govern the manner
in which we conduct its business activities outside of mainland China. However, the PRC legal system is evolving quickly, and PRC laws,
regulations, and rules may change quickly with little advance notice, including with respect to Hong Kong-based businesses. As a
result, there can be no assurance that we will not be subject to direct influence or discretion over its business from organs of the
PRC government in the future, due to changes in laws or other unforeseeable reasons or due to our expansion or acquisition of operations
in or involving mainland China.
 
 The PRC government has exercised and continues
to exercise substantial control over many sectors of the PRC economy, including through regulation and/or state ownership. PRC government
actions have had, and may continue to have, a significant effect on economic conditions in the PRC and the businesses which are subject
to them. If we became subject to the direct intervention or influence of the PRC government at any time due to changes in laws or other
unforeseeable reasons or as a result of our development, expansion, or acquisition of operations in the PRC, we may be required to make
material changes in its operations, which may result in increased costs necessary to comply with existing and newly adopted laws and
regulations or penalties for any failure to comply, or both. We cannot be assured that the PRC government will not, in the future, release
regulations or policies regarding other industries, which, if applicable to us, may adversely affect our business, financial condition
and results of operations.
 
 In addition, the various segments of AGBA are
regulated by a number of Hong Kong regulators, including, the Hong Kong Insurance Authority and the Mandatory Provident Fund
Schemes Authority. PRC government influence or oversight over such Hong Kong regulators may have an indirect but material impact
to us, including but not limited to with respect to capital requirements, its ability to operate certain businesses, its operations in
certain jurisdictions (including the markets in which we may operate in the future) and/or the implementation of certain controls and
procedures in relation to risk management or cybersecurity. Furthermore, the market prices and/or liquidity of the securities of we could
be adversely affected as a result of anticipated negative impacts of any such government actions, as well as negative investor sentiment
towards Hong Kong-based companies subject to direct PRC government oversight and regulation, regardless of actual operating performance.
There can be no assurance or guarantee that the PRC government would not intervene in or influence our operations, directly or indirectly,
at any time.
 
 The securities of AGBA may be delisted
or prohibited from being traded “over-the-counter” under the Holding Foreign Companies Accountable Act (as amended by the
Accelerating Holding Foreign Companies Accountable Act) if the PCAOB were unable to fully inspect the company’s auditor. 
 
 The Holding Foreign Companies Accountable Act,
or the HFCA Act, was enacted into U.S. law on December 18, 2020. The HFCA Act states that if the SEC determines that a company
has filed audit reports issued by a registered public accounting firm that has not been subject to inspection by the Public Company Accounting
Oversight Board of the United States (the “PCAOB”) for three consecutive years beginning in 2021, the SEC shall
prohibit its securities from being traded on a national securities exchange or in the over-the-counter trading market in the U.S. On
December 16, 2021, the Public Company Accounting Oversight Board of the United States (the “PCAOB”) issued a Determination
Report which found that the PCAOB is unable to inspect or investigate completely registered public accounting firms headquartered in:
(i) China, and (ii) Hong Kong. Our management believes that this determination does not impact us, as the auditor of AGBA,
WWC, P.C., (i) is headquartered in California, U.S.A., (ii) is an independent registered public accounting firm with the PCAOB,
and (iii) has been inspected by the PCAOB on a regular basis. Nonetheless, there can be no assurance that future changes in laws
or regulations will not impact AGBA, WWC, P.C., or any future auditor of AGBA. Accordingly, there can be no assurance that WWC,
P.C. will be able to meet the requirements of the HFCA Act and that we will not suffer the resulting material and adverse impact on its
stock performance, as a company listed in the United States.
 
 11 

 On December 2, 2021, the SEC adopted final amendments
implementing congressionally mandated submission and disclosure requirements of the HFCA Act. On December 23, 2022, the Accelerating
Holding Foreign Companies Accountable Act (AHFCA Act) was enacted, which amended the HFCA Act by requiring the SEC to prohibit an issuer’s
securities from trading on any U.S. stock exchanges if its auditor is not subject to PCAOB inspections for two consecutive years instead
of three. As a result, the time period before the Company’s securities may be prohibited from trading or delisted for the above
reasons has been reduced accordingly.
 
 Lack of access to PCAOB inspections prevents
the PCAOB from fully evaluating audits and quality control procedures of the accounting firms headquartered in mainland China or Hong Kong.
As a result, investors in companies using such auditors may be deprived of the benefits of such PCAOB inspections. On August 26, 2022,
the China Securities Regulatory Commission, or CSRC, the Ministry of Finance of the PRC, and PCAOB signed a Statement of Protocol, or
the Protocol, governing inspections and investigations of audit firms based in China and Hong Kong. Pursuant to the Protocol, the
PCAOB has independent discretion to select any issuer audits for inspection or investigation and has the unfettered ability to transfer
information to the SEC. On December 15, 2022, the PCAOB announced that it was able to secure complete access to inspect and investigate
PCAOB-registered public accounting firms headquartered in mainland China and Hong Kong in 2022, and the PCAOB Board vacated its previous
determinations that the PCAOB was unable to inspect or investigate completely registered public accounting firms headquartered in mainland
China and Hong Kong. However, whether the PCAOB will continue to be able to satisfactorily conduct inspections of PCAOB-registered public
accounting firms headquartered in mainland China and Hong Kong is subject to uncertainty and depends on a number of factors out of our,
and our auditor’s, control. The PCAOB is continuing to demand complete access in mainland China and Hong Kong moving forward and
is already making plans to resume regular inspections in early 2023 and beyond, as well as to continue pursuing ongoing investigations
and initiate new investigations as needed. The PCAOB has indicated that it will act immediately to consider the need to issue new determinations
with the HFCA Act if needed.
 
 WWC, P.C. is headquartered in California and has
been inspected by the PCAOB on a regular basis. We believe, therefore, that WWC, P.C. is not subject to the determinations announced by
the PCAOB on December 16, 2021 with respect to PRC and Hong Kong-based auditors. WWC, P.C. is not included in the list
of determinations announced by the PCAOB on December 21, 2021 in their HFCA Act Determination Report under PCAOB Rule 6100. If
notwithstanding this new framework, the PCAOB was unable to fully inspect WWC, P.C. (or any other auditor of the Company) in the future,
or if PRC or American authorities further regulate auditing work of Chinese or Hong Kong companies listed on the U.S. stock
exchanges in a manner that would restrict WWC, P.C. (or any future auditor of the Company) from performing work in Hong Kong, we
may be required to change its auditor. Furthermore, there can be no assurance that the SEC, Nasdaq, or other regulatory authorities would
not apply additional and more stringent criteria to AGBA in connection with audit procedures and quality control procedures, adequacy
of personnel and training, or sufficiency of resources, geographic reach or experience as it relates to the audit of our financial statements.
The failure to comply with the requirement in the HFCA Act, as amended by the AHFCA Act, that the PCAOB be permitted to inspect the issuer’s
public accounting firm within two years, would subject us to consequences including the delisting of AGBA in the future if the PCAOB
is unable to inspect AGBA’s accounting firm (whether WWC, P.C. or another firm) at such future time.
 
 Our former auditor, Friedman LLP (“Friedman”),
the independent registered public accounting firm that issues the audit report included elsewhere in this annual report is subject to
laws in the U.S., pursuant to which the PCAOB conducts regular inspections to assess their compliance with the applicable professional
standards. Effective September 1, 2022, Friedman combined with Marcum LLP (“Marcum”) and continued to operate as an independent
registered public accounting firm. Friedman and Marcum are both headquartered in Manhattan, New York, and have been inspected by the
PCAOB on a regular basis, with the last inspections in 2020, and neither Friedman nor Marcum is subject to the determinations announced
by the PCAOB on December 16, 2021.
 
 12 

 Although not currently subject, AGBA may
become subject to the PRC laws and regulations regarding offerings that are conducted overseas and/or foreign investment in China-based issuers,
and any failure to comply with applicable laws and obligations could have a material and adverse effect on the business, financial condition,
results of operations, and AGBA’s prospects of AGBA and may hinder AGBA’s ability to offer or continue to offer securities
to investors and cause the value of such securities to significantly decline or be worthless. 
 
 In recent years, the PRC government has initiated
a series of regulatory actions and statements to regulate business operations in certain areas in China with little advance notice, including
cracking down on illegal activities in the securities market, enhancing supervision over China-based companies listed overseas using
a VIE structure, adopting new measures to extend the scope of cybersecurity reviews, and expanding the efforts in anti-monopoly enforcement.
On June 10, 2021, the Standing Committee of the National People’s Congress enacted the PRC Data Security Law, which took effect
on September 1, 2021. The law requires data collection to be conducted in a legitimate and proper manner, and stipulates that, for
the purpose of data protection, data processing activities must be conducted based on data classification and hierarchical protection
system for data security.
 
 On July 6, 2021, the General Office of the
Communist Party of China Central Committee and the General Office of the State Council jointly issued a document to crack down on illegal
activities in the securities markets and promote the high-quality development of the capital markets, which, among other things,
requires the relevant governmental authorities to strengthen cross-border oversight of law-enforcement and judicial cooperation,
to enhance supervision over China-based companies listed overseas, and to establish and improve the system of extraterritorial application
of the PRC securities laws.
 
 On August 20, 2021, the 30 meeting of the
Standing Committee of the 13 National People’s Congress voted and passed the “Personal Information Protection Law of the
People’s Republic of China”, or “PRC Personal Information Protection Law”, which became effective on November 1,
2021. The PRC Personal Information Protection Law applies to the processing of personal information of natural persons within the territory
of China that is carried out outside of China where (1) such processing is for the purpose of providing products or services for
natural persons within China, (2) such processing is to analyze or evaluate the behavior of natural persons within China, or (3) there
are any other circumstances stipulated by related laws and administrative regulations.
 
 On December 24, 2021, the China Securities
Regulatory Commission (“CSRC”), together with other relevant government authorities in China issued the Provisions of the
State Council on the Administration of Overseas Securities Offering and Listing by Domestic Companies (Draft for Comments), and the Measures
for the Filing of Overseas Securities Offering and Listing by Domestic Companies (Draft for Comments) (“Draft Overseas Listing
Regulations”). The Draft Overseas Listing Regulations requires that a PRC domestic enterprise seeking to issue and list its shares
overseas (“Overseas Issuance and Listing”) shall complete the filing procedures of and submit the relevant information to
CSRC. The Overseas Issuance and Listing includes direct and indirect issuance and listing. Where an enterprise whose principal business
activities are conducted in PRC seeks to issue and list its shares in the name of an overseas enterprise (“Overseas Issuer”)
on the basis of the equity, assets, income or other similar rights and interests of the relevant PRC domestic enterprise, such activities
shall be deemed an indirect overseas issuance and listing (“Indirect Overseas Issuance and Listing”) under the Draft Overseas
Listing Regulations.
 
 On December 28, 2021, the Cyberspace Administration
of China (“CAC”) jointly with the relevant authorities formally published Measures for Cybersecurity Review (2021) which
took effect on February 15, 2022 and replaced the former Measures for Cybersecurity Review (2020) issued on July 10, 2021.
Measures for Cybersecurity Review (2021) stipulates that operators of critical information infrastructure purchasing network products
and services, and online platform operators (together with the operators of critical information infrastructure, the “CII Operators”)
carrying out data processing activities that affect or may affect national security, shall conduct a cybersecurity review, and that any
online platform operator who controls more than one million users’ personal information must go through a cybersecurity review
by the cybersecurity review office if it seeks to be listed in a foreign country.
 
 13 

 We may collect and store certain data (including
certain personal information) from their clients, who may be PRC individuals, in connection with their business and operations and for
“Know Your Customers” purposes (to combat money laundering). Given that (1) AGBA and its subsidiaries are incorporated
either in Hong Kong or the British Virgin Islands and are located in and conduct their operations in Hong Kong, (2) we
have no subsidiaries, VIE structure, nor any operations in mainland China, and (3) pursuant to the Basic Law, the national laws
of the PRC shall not be applied in Hong Kong except for those listed in Annex III of the Basic Law (which is confined to laws
relating to defense and foreign affairs, as well as other matters outside the autonomy of Hong Kong), our management does not currently
expect the Measures for Cybersecurity Review (2021), the PRC Personal Information Protection Law, or the Draft Overseas Listing Regulations
to impact our operations. As of date of this annual report, we have conducted all sales activities in Hong Kong and in the aggregate
have collected and stored personal information of less than one million users in the PRC, all of the data collected is stored in servers
located in Hong Kong, and none of us or our subsidiaries have been informed by any PRC governmental authority of any requirement
that it file for a cybersecurity review or a CSRC review. Accordingly, our management does not currently expect that the laws and regulations
in the PRC on data security, data protection or cybersecurity apply to us or that the oversight of the CAC will be extended to our operations
in Hong Kong, because (i) AGBA is not a “CII Operator” or a “Network Platform Operator” as defined
under the relevant PRC cyberspace laws; (ii) AGBA does not harm PRC national security, public interests, or the legitimate rights
and interests of citizens or organizations of the PRC; (iii) AGBA is not subject to PRC government cyberspace scrutiny; and (iv) AGBA
is compliant with PRC cyberspace laws that have been issued up to the date of this annual report.
 
 However, since these statements and regulatory
actions are new, it is highly uncertain how soon the legislative or administrative regulation making bodies will act, what existing or
new laws or regulations or detailed implementations and interpretations will be modified or promulgated, if any, and whether any of these
will apply to us, if at all. There can be no assurance that we will be able to comply in all respects with any PRC regulatory requirements
that may become applicable to it in the future. For example, our current practice of collecting and processing personal information may
be ordered to be rectified or terminated by regulatory authorities. In the event of a failure to comply with any applicable regulations,
we may become subject to the consequences of such non-compliance, including fines and other penalties, which, in turn, may have a material
adverse effect on the business, operations, financial condition, and prospects of AGBA and may hinder the ability of AGBA to offer or
continue to offer securities to investors. Such an impact could, in turn, cause the value of such securities to significantly decline
or be worthless.
 
 Governments in the jurisdictions AGBA operates
or intends to operate may restrict or control to varying degrees the ability of foreign investors to invest in businesses located or
operating in such jurisdictions. 
 
 Because we are incorporated in the British Virgin
Islands, shareholders may be deemed to be foreign investors in Hong Kong and therefore be subject to restrictions or controls in
Hong Kong on the ability of foreign investors to invest in business located or operating in Hong Kong. As a result, there may
be a risk of loss to our investors due to, among other things, expropriation, nationalization or confiscation of assets, or the imposition
of restrictions on repatriation of capital invested, in each case by the governmental or regulatory agencies empowered in Hong Kong.
While, in some cases, the British Virgin Islands has entered into international investment treaties or agreements designed to encourage
and protect investment by BVI persons in foreign jurisdictions, there can be no guarantee that such treaties or agreements will cover
Hong Kong or that such treaties or agreements will be fully implemented or effective. In other cases, we may not be able to take
advantage of certain treaties because it or they are British Virgin Islands companies and are therefore exposed to additional risk of
such loss.
 
 AGBA is subject to many of the economic
and political risks associated with emerging markets, particularly China, due to its operations in Hong Kong. Adverse changes in
Hong Kong’s or China’s economic, political, and social conditions as well as government policies could adversely affect
AGBA’s business and prospects. 
 
 We currently conduct its business in Hong Kong
and is considering options for expansion of its business in mainland China. Accordingly, we are subject to risks and uncertainties including
fluctuations in mainland China’s GDP, unfavorable or unpredictable treatment in relation to tax matters, expropriation of private
assets, exchange controls, restrictions affecting its ability to make cross-border transfers of funds, regulatory proceedings, inflation,
currency fluctuations, or the absence of, or unexpected changes in, regulations and unforeseeable operational risks. In addition, our
business, prospects, financial condition, and results of operations may be significantly influenced by political, economic, and social
conditions in Hong Kong and China generally and by continued economic growth in China.
 
 14 

 The Chinese economy differs from the economies
of most developed jurisdictions (such as Hong Kong) in many respects, including the amount of government involvement, level of development,
growth rate, control of foreign exchange, and allocation of resources. Although the PRC government has implemented measures that focus
on accounting for market forces to effect economic reform and are aimed at reducing the state ownership of productive assets and establishing
improved corporate governance in business enterprises, a substantial portion of China’s productive assets are still owned by the
government. In addition, the PRC government continues to play a significant role in regulating development through industrial policies.
The PRC government also exercises significant control over China’s economic growth through its allocation of resources, control
of payment of foreign currency-denominated obligations, monetary policy, and preferential treatment for particular industries or
companies. Many of the economic reforms carried out by the PRC government are unprecedented or experimental and are expected to be refined
and improved over time. This refining and adjustment process may not necessarily have a positive effect on the operations and business
development of AGBA. Other political, economic, and social factors may also lead to further adjustments of the reform measures.
For example, the PRC government has in the past implemented a number of measures intended to curtail certain segments of the economy,
including the real estate industry, which the government believed to be overheating. These actions, as well as other actions and policies
of the PRC government, could cause a decrease in the overall level of economic activity in the PRC and, in turn, have an adverse impact
on our business and financial condition.
 
 While the Chinese economy has experienced significant
growth over the past decades, growth has been uneven, both geographically and among various sectors of the economy. The PRC government
has implemented various measures to encourage economic growth and guide the allocation of resources. Some of these measures, which may
benefit the overall Chinese economy, may have a negative effect to us. For example, our financial condition and results of operations
may be adversely affected by government control over capital investments or changes in tax regulations. In addition, the PRC government
has from time to time implemented certain measures, including interest rate changes, to control the pace of economic growth. These measures
may cause decreased economic activity in China, as evidenced by the slowing of growth of the Chinese economy since 2012. In addition,
COVID-19 has had a severe and negative impact on the Chinese economy since the first quarter of 2020. Whether this will lead to
a prolonged downturn in the Chinese economy is still unknown. In addition, any future escalation of the ongoing trade war between the
United States and China, regional or national instability, the ongoing impact of the COVID-19 pandemic, or the armed conflict
between Russia and Ukraine may negatively impact the growth of the Chinese economy. Any prolonged slowdown in the Chinese economy or
adverse changes in the policies of the Chinese government or in the laws and regulations in China could have a material adverse effect
on the overall economic growth of China and may reduce the demand for our services and solutions among potential Chinese customers and
materially and adversely affect its business and results of operations.
 
 National laws of the PRC do not apply in Hong Kong
unless they are listed in Annex III of the Basic Law and applied locally by promulgation or local legislation. National laws that
may be listed in Annex III are currently limited under the Basic Law to those which fall within the scope of defense and foreign
affairs as well as other matters outside the limits of the autonomy of Hong Kong. National laws and regulations relating to data
protection, cybersecurity and the anti-monopoly have not been listed in Annex III and so do not apply directly to Hong Kong.
The laws and regulations in the PRC are evolving, and their enactment timetable, interpretation and implementation involve significant
uncertainties. To the extent any PRC laws and regulations become applicable to us, it may be subject to the risks and uncertainties associated
with the legal system in the PRC, including with respect to the enforcement of laws and the possibility of changes of rules and regulations
with little or no advance notice. We may also become subject to the laws and regulations of the PRC to the extent it commences business
and customer facing operations in mainland China as a result of any future acquisition, expansion, or organic growth.
 
 AGBA’s potential expansion of activities
in China is subject to various risks. 
 
 We, as of the date of this annual report, primarily
operate in Hong Kong. We have been pursuing and will continue to pursue its growth strategy in China, particularly in the Greater
Bay Area, comprising Macau, Guangzhou, Shenzhen, and the surrounding area. Currently, we do not have any Chinese operating entities and
does not plan to use “variable interest entities,” or VIEs, in the future to conduct its operations. Our management intends
for such expansion to be conducted through customer referrals and partnerships, with its actual sales activities conducted in Hong Kong.
For instance, we are currently in active discussions to establish a strategic partnership with the Potential Partner in China to provide
offshore insurance solutions to its over 20 million customers. Accordingly, our management expects the main source of revenue from
such expansion in China to be generated from referral income.
 
 15 

 Any expansion of our China-related activities
may expose it to additional risks, including:
 
 ● Changing global
 environment, including changes in U.S., Chinese, and international trade policies; 

 ● Challenges associated
 with relying on local partners in markets that are not as familiar to AGBA, including joint
 venture partners to help AGBA establish its business; 

 ● Difficulties managing
 operations in new regions, including complying with the various regulatory and legal requirements; 

 ● Different governmental
 approval or licensing requirements; 

 ● Challenges in
 recruiting sufficient suitable personnel in new markets; 

 ● Challenges in
 providing services and solutions as well as support in these new markets; 

 ● Challenges in
 attracting business partners and customers; 

 ● Potential adverse
 tax consequences; 

 ● Foreign exchange
 losses; 

 ● Limited protection
 for intellectual property rights; 

 ● Inability to effectively
 enforce contractual or legal rights; 

 ● International
 travel restrictions and temporary lock-downs due to COVID-19; and 

 ● Local political,
 regulatory, and economic instability or wars, civil unrest, and terrorist incidents. 

 Moreover, changes in China’s economic,
political, or social conditions or government policies could have a material adverse effect on our growth plans. If we are unable
to effectively avoid or mitigate these risks, its ability to grow its China-related business will be affected, which could have
a material adverse effect on its business, financial condition, results of operations, and prospects.
 
 As we further expand into the international market,
it is increasingly subject to additional legal and regulatory compliance requirements, including local licensing and periodic reporting
obligations. We may inadvertently fail to comply with local laws and regulations, and any such violation could subject to regulatory
penalties, such as revocation of licenses, which would in turn harm its brand, reputation, business operation and financial results.
Although we have policies and procedures in place to enhance compliance with local laws and regulations, there can be no assurance that
its employees, contractors, or agents will stay compliant with these policies and procedures.
 
 AGBA’s financial services revenues
are highly dependent on macroeconomic conditions as well as market conditions in Hong Kong, China, and globally. Disruptions
in the global financial markets and economic conditions could adversely affect the AGBA and its institutional clients and customers. 
 
 Given the significant proportion of its business
operations concentrated in Hong Kong, our success depends largely on the health of the Hong Kong financial industry, which
is affected by changes in general economic conditions beyond the our control. Economic factors such as increased interest rates, slow
economic growth or recessionary conditions, changes in household debt levels, and increased unemployment or stagnant or declining wages
affect the our customers’ income and thus their ability and willingness to take loans from us, invest with us, or engage with our
other financial products. Domestic and global events affect all such macroeconomic conditions. Weak or a significant deterioration in
economic conditions reduce the amount of disposable income both individual and institutional consumers have, which in turn reduces consumer
spending and their willingness to engage with the our financial services. Any or all of the circumstances described above may lead to
further volatility in or disruption of the credit and other financial markets at any time and could adversely affect our financial condition.
 
 Changes in the condition of Hong Kong’s
and China’s economies generally affect the demand and supply of financial products, which in turn will affect demand for the solutions
that we provide. For example, a credit crisis, or prolonged downturn in the credit markets could severely affect our operating environment
by, for example, causing a tightening in credit guidelines, limited liquidity, deterioration in credit performance, or increased foreclosures.
Since a significant portion of our revenue is generated from transaction-based fees and commissions, a decrease in transaction volumes
could cause a material decline in our revenues for the duration of such crisis.
 
 Global economies could suffer dramatic downturns
as the result of a deterioration in the credit markets and related financial crisis as well as a variety of other factors including,
extreme volatility in security prices, diminished liquidity and credit availability, and ratings downgrades or declining valuations of
certain investments. In past economic downturns, governments have taken unprecedented actions to address and rectify these extreme market
and economic conditions, including by providing liquidity and stability to the financial markets. If these actions are not successful,
the return of adverse economic conditions may significantly affect the businesses of our customers, which could in turn negatively affect
our revenues.
 
 16 

 In addition, there is considerable uncertainty
over the long-term effects of the expansionary monetary and fiscal policies adopted by central banks and financial authorities in
some of the world’s leading economies, including the European Union, the United States, and China. There have been concerns
over unrest and terrorist threats in the Middle East, Europe, and Africa. There have also been concerns on the relationship among China
and other Asian countries, which may result in or intensify potential conflicts in relation to territorial disputes, and escalations
in the trade tensions between the United States and China. Starting from 2018, changes in U.S. trade policies have occurred,
including the imposition of tariffs. These types of developments, including a potential trade war, could have a material adverse impact
on the Chinese economy and in turn on the Hong Kong economy. On January 31, 2020, the United Kingdom ceased to be a member
of the European Union (commonly referred to as “Brexit”). The effects of Brexit on worldwide economic and market conditions
remain uncertain. Brexit could adversely affect European and worldwide economic and market conditions and could contribute to instability
in global financial and foreign exchange markets. Furthermore, protests in Hong Kong in 2019, political instability in the
Korean Peninsula, a slump in commodity prices, uncertainty over interest rates in the United States, the outbreak and spread of
the COVID-19 pandemic, and the armed conflict between Russia and Ukraine have also resulted in instability and volatility in the
global financial markets. Recently, the global stock markets have experienced extreme volatility, in reaction to the outbreak of the
conflict between Russia and Ukraine and governments’ responses thereto. It is unclear whether these challenges and uncertainties
will be contained or resolved, and what effects they may have on the global political and economic conditions in the long term.
 
 Failure to comply with existing or future
laws and regulations related to data protection or data security could lead to liabilities, administrative penalties, or other regulatory
actions, which could negatively affect the AGBA’s operating results, business, and prospects. 
 
 The regulatory framework for the collection,
use, safeguarding, sharing, transfer and other processing of personal data worldwide is rapidly evolving and is likely to remain uncertain
for the foreseeable future. Regulatory authorities in virtually every jurisdiction in which we have implemented or are considering a
number of legislative and regulatory proposals concerning personal data protection. Our management has been monitoring the evolution
of this area of law and intends to take steps to ensure compliance with laws applicable to our current operations in Hong Kong and
potential future operations in China.
 
 While our management believes that we are not
currently subject to PRC laws relating to the collection, use, sharing, retention, security, and transfer of confidential and private
information, such as personal information and other data, We may be subject to such laws in the future. These laws continue to develop,
and the PRC government may adopt other rules and restrictions in the future. Non-compliance could result in penalties or other significant
legal liabilities.
 
 Risk Factors Relating to AGBA’s Business 
 
 The ability of AGBA to continue as a going
concern is dependent upon its ability to raise additional funds and implement its business plan. 
 
 Our consolidated financial statements
accompanying this annual report were prepared assuming that we will continue as a going concern, which contemplates continuity of
operations, realization of assets, and liquidation of liabilities in the normal course of business. For the year ended
December 31, 2022, we reported approximately US$44.5 million net loss and $19.3 million net cash outflows from operating
activities. As of December 31, 2022, we had the accumulated losses of approximately US$39.4 million and cash and cash
equivalents of $6.4 million.
 
 Our management intends to continue to monitor
our capital structure and evaluate various funding alternatives that may be needed to finance its growth strategy, business development,
and operating expenses, including fundraising through equity or debt capital markets. Nonetheless, there can be no assurance that we
will be successful in such fundraising or that if it can secure such funds that they will be sufficient to meet the financing needs of
AGBA and to allow us to continue as a going concern. See “ Management’s Discussion and Analysis of Financial Condition
and Results of Operations — Liquidity and Going Concern .”
 
 17 

 The success and growth of AGBA will depend,
in part, upon its ability to be a leader in technological innovation in its industries. 
 
 We operate in industries experiencing rapid technological
change and frequent product introductions. To succeed, we must lead its peers in designing, innovating, and introducing new technology
and product offerings. The process of developing new technologies and products is complex, and if we are unable to successfully innovate
and continue to deliver a superior client experience, the demand for its products and services may decrease, it may lose market share
and its growth and operations may be hampered.
 
 For example, part of our Platform Business relies
on its continued ability to process loan applications over the internet, accept electronic signatures, provide instant process status
updates, and provide other client- and loan applicant-expected conveniences. Our proprietary platform technology is integrated into
all steps of its business processes. Our dedication to incorporating technological advancements into its service platforms requires significant
financial and personnel resources. Maintaining and improving this technology will require us to expend significant capital expenditures
on its proprietary technology platforms.
 
 To the extent that we are dependent on any particular
technology or technological solution, it may be harmed if such technology or technological solution becomes non-compliant with existing
industry standards, fails to meet or exceed the capabilities of its competitors’ equivalent technologies or technological solutions,
becomes increasingly expensive to service, retain, and update, becomes subject to third-party claims of intellectual property infringement,
misappropriation, or other violation, or malfunctions or functions in a way not anticipated. Additionally, new technologies and technological
solutions are continually being released. As such, it is difficult to predict the problems that we may encounter in improving its websites’
and other technologies’ functionality.
 
 The technologies that AGBA uses may contain
undetected errors, which could result in customer dissatisfaction, damage to the AGBA’s reputation, or loss of customers. 
 
 Some of the solutions that we offer are built
on large stacks of data, requiring sophisticated and innovative technologies to address our operating needs, predict operating patterns,
and help make decisions in terms of business strategies and implementation plans. We aim to make its operations and solutions more streamlined,
automated, and cost-effective by using advanced technologies which are currently under development. We may encounter technical obstacles,
and it may discover problems that prevent such technologies from operating properly, or at all, which could adversely affect our information
infrastructure and other aspects of its business where such technologies are applied. If our solutions do not function reliably or fail
to achieve its customers’ expectations for performance, we may lose existing customers or fail to attract new ones, which may damage
its reputation and adversely affect its business, financial condition, and results of operations. Material performance problems, defects,
or errors in our existing or new software, applications, and solutions may arise and may result from the interface between solutions
and systems and data that it did not develop, the function of which is beyond its control, or defects and errors that were undetected
in internal testing. These types of defects and errors, and any failure by us to identify and address them, could result in a loss of
revenue or market share, diversion of development resources, harm to our reputation and increased service and maintenance costs. Defects
or errors may discourage existing or potential customers from utilizing our solutions. Correcting these types of defects or errors could
prove to be impossible or impracticable. The costs incurred in correcting any defects or errors may be substantial and could have a material
adverse effect on our business, financial condition, and results of operations.
 
 We rely on our business relationships with
product issuers and the success of those product issuers, and the future development depends, in part, on the growth of such product
issuers and their continued collaboration. 
 
 The Platform Business relies, in part, on financial
products provided by certain banks, insurance companies, or other companies that offer financial products (product issuers). Our management
team believes that establishment of business relationships with major product issuers such as MassMutual Asia Limited, Prudential Hong Kong
Limited, and Zurich International Life Limited, which facilitates our ability to provide a wide variety of products to satisfy customers’
needs and enables it to negotiate favorable terms with such product issuers, to the benefit of its customers, contributes to its current
success. The long-term business relationships that the Platform Business has established with major product issuers are formed on
the basis of the terms of business, broker contracts, and/or conditions issued by the product issuer(s) setting out the terms and
conditions upon which product issuer(s) are prepared to accept business referred or introduced to them. However, there is no assurance
that the Platform Business will succeed in maintaining existing and/or establishing new, strategic relationships with product issuers.
If the Platform Business cannot maintain and/or establish such relationships, it and its subsidiaries’ access to similar financial
products may be restricted, and their business, operations, and financial position may, in turn, be adversely affected.
 
 18 

 The Platform Business’s future development
depends, in part, on the growth of such product issuers, on their continued development of new financial products, and on their continued
collaboration. Failure by such product issues to continue to sell new financial products may, in turn, limit our ability to offer such
products to their customers. There can be no assurance that if any product issuer discontinued its business or ceased to collaborate
with us could find replacement products on comparable terms, or at all. If the Platform Business cannot maintain its current pipeline
of products from product issuers, it and its subsidiaries’ access to similar financial products may be restricted, and their business,
operations, and financial position may, in turn, be adversely affected.
 
 The property agency segment of the Platform
Business has historically operated on thin margins, which expose it to risk of non-profitability and recent trends have caused the segment
to be loss-making. 
 
 The
property agency segment of the Platform Business, run by OnePlatform International Property Limited (“OIP”), has historically
operated with thin profit margins. In accordance with its contracts with property developers and agreements with its own staff, commission
income from OIP’s operations is dispersed broadly
among both the consultancy force and salespersons, often equaling up to 50% of the commission. This significant split of commission income
has historically resulted in marginal profit for OIP. 
 
 In recent years, the segment has been loss-making
and was supported by intercompany loans. While our management intends to generate sufficient cash flows from the segment to repay such
intercompany loans and create positive profit margins, there can be no assurance that the property agency segment of the Platform Business
will be able to generate such cash flows now or in the future. Without a change in the commission sharing mechanism or optimization of
the segment’s operating costs, the property agency segment’s ability to achieve additional profits may be limited. There
can be no assurance that OIP will be able to achieve changes in commission sharing or optimization of operating costs to sufficient levels,
or at all. In addition, given the competitive environment in which OIP operates, there also can be no guarantee that such changes would
not create a loss of engagement with property developers and salespersons. Such disruptions to the property agency segment of the Platform
Business could have negative effects on its business, financial condition, results of operations, and prospects.
 
 AGBA relies on third parties for various
aspects of its business and the services and solutions that it offers. AGBA’s business, results of operations, financial condition,
and reputation may be materially and adversely affected if these third parties do not continue to maintain or expand their relationship
with AGBA, or if they fail to perform in accordance with the terms of their relevant contracts. 
 
 We rely on third parties for various aspects
of its business and the solutions they offer. For example, we rely on computer hardware, software, and cloud services, internet and telecommunication
services, and third-party supplied data. We expect to continue to rely on these third parties to supplement its capabilities for
a significant period, if not indefinitely. Therefore, we need all of these parties to function in a flawless and timely manner in order
to conduct its business. However, there can be no assurance that these third parties will provide their support properly or in a cost-effective manner
or that the third party-supplied data we rely on will be complete, accurate, or reliable. In the event of problems with any of these
third-party providers, transitioning to new providers may disrupt our business and increase costs.
 
 If any of the third-party service providers
fail to perform properly, there can be no assurance that we would be able to find suitable replacement suppliers on commercially reasonable
terms on a timely basis, or at all. The third-party service providers may carry out their business in an inappropriate manner or
in violation of regulations or laws. Any of such occurrences could diminish our ability to operate or damage its business reputation,
or cause it regulatory or financial harm, any of which could negatively affect our business, financial condition, and results of operations.
 
 Failure to maintain and enlarge the customer
base of AGBA or to strengthen customer engagement may adversely affect its business and results of operations. 
 
 Our revenue growth depends, in part, on its ability
to maintain and enlarge its customer base and strengthen customer engagement so that more of its customers will use our solutions more
often and contribute to our revenue growth. Although we maintain business relationships with its existing customers and has successfully
developed different marketing channels to generate business from referrals, recurring business, and direct marketing, less than 15% of
the total revenue for the year ended December 31, 2022 was generated by recurring business from existing customers purchasing new
products through the Platform Business. This diffusion of our customer base requires us to constantly maintain and refresh its broad customer
base. Our customers are, however, geographically concentrated, as substantially all of its major customers are located in Hong Kong.
Fluctuations in the macro-economic environment in Hong Kong may have adverse effects on our major clients.
 
 19 

 There can be no assurance that our customers
will continue to use its services and solutions once their existing contract or relationship expires or that they will purchase additional
solutions from us. This risk is especially apparent in circumstances where it is inexpensive for them to switch service providers.
Our ability to maintain and enlarge its customer base and strengthen customer engagement will depend on many factors, some of which are
out of our control, including:
 
 ● its ability to
 continually innovate technologies to keep pace with rapid technological changes; 

 ● its ability to
 continually innovate solutions in response to evolving customer demands and expectations
 and intense market competition; 

 ● its ability to
 customize solutions for customers; 

 ● customer satisfaction
 with our solutions, including any new solutions that AGBA may develop, and the competitiveness
 of pricing and payment terms; 

 ● the effectiveness
 of our solutions in helping customers improve efficiency, enhance service quality, and reduce
 costs; 

 ● customers’
 acceptance of our pricing models; 

 ● Our ability to
 transition customers from “hook products,” which AGBA provides at low or even
 no charge, to products that provide more revenue and better margins; and 

 ● the success and
 growth of our customers, which could be affected by general-economic and market conditions,
 regulatory developments and other factors. 

 As many of our customers are engaged using a
transaction-based model, a reduction of transactions by its customers would adversely affect our business and results of operations.
For example, the COVID-19 pandemic may have a negative impact on business growth, project implementation, and our customers’
usage of its solutions, and thus, our revenue.
 
 In addition, we have derived some of its customers
either through acquisitions of new businesses or by intra-group referrals. If we cannot develop customers organically, conduct as
many acquisitions, or receive as many customer referrals as it has historically, it may not be able to grow its customer base as quickly,
or at all.
 
 A number of AGBA’s business partners
are commercial banks and other financial institutions that are highly regulated, and the tightening of laws, regulations, or standards
in the financial services industry could harm its business. 
 
 A number of our business partners are commercial
banks and other financial institutions that are highly regulated and must comply with complex and changing government regulations and
industry standards, which are subject to significant changes, in the various jurisdictions in which they operate. Global, regional, or
local regulatory developments, including those in respect of consumer protection, credit availability, risk management, and data privacy,
could adversely affect our customers or otherwise result in a reduction in the volume and frequency of its business transactions.
 
 Our financial institution partners must sometimes
include restrictive provisions in their contracts with service providers, with respect to security and privacy, ongoing monitoring, risk
management, and other limitations. These provisions may increase our costs, limit the scope of the solutions we offer, or otherwise restrict
customer access. In addition, our customers may have less capacity or incentive to purchase solutions from us, may pass on their increased
costs to us, or may cease to use certain of our solutions. As aspects of our business employ a broker-based model, any reduction
of transactions by our partners may materially and adversely affect our business and results of operations.
 
 20 

 As a result of such laws and regulations, certain
of our business partners have had, or will have, to adjust their business practices in ways that reduce their use of our solutions, and
these types of changes in response to regulatory developments may adversely affect our business, result of operations, and financial
conditions.
 
 Significant increases and decreases in
the number of transactions by AGBA’s clients can have a material negative effect on AGBA’s profitability and its ability
to efficiently process and settle transactions. 
 
 Significant volatility in the number of client
transactions and rebalancing activity may result in operational problems such as a higher incidence of failures to deliver services and
errors in processing transactions, and such volatility may also result in increased personnel and related processing costs. We may experience
adverse effects on its profitability resulting from significant reductions in product sales and may encounter operational problems arising
from unanticipated high transaction volume because we are not able to control such fluctuations.
 
 In addition, significant transaction volume could
result in inaccurate books and records, which would expose us to disciplinary action by governmental agencies and other relevant regulators.
 
 We operate in a competitive and evolving
industry; if we are unable to compete effectively, it may lose market share. 
 
 The market competition in which we operate is
intense and all aspects of their businesses are highly competitive. we compete for clients, customers, and personnel directly with other
financial advisory firms, securities firms, and, increasingly, with other types of organizations and businesses offering financial services,
such as banks and insurance companies. The financial technology services industry in Hong Kong and China is also highly competitive
and rapidly evolving. New competitors, including affiliates of financial institutions, traditional IT companies, and internet companies,
are entering this market.
 
 We primarily face competition posed by major,
existing financial institutions, including traditional banks and insurance agencies. However, we also face threats of new players entering
its industries, particularly the fintech industry, in Hong Kong and China. While our management believes that we have a competitive
advantage by having a full suite of financial products (including insurance, investment, and credit) coupled with a captive customer
base and well-established infrastructure (including operational capabilities and technology), some of our competitors may have greater
brand recognition, larger customer bases or greater financial, technological, or marketing resources. There can be no assurance that
our competitors will not be able to respond more quickly and effectively than us to new or changing opportunities, technologies, standards,
or customer requirements, or successfully adapt to significant changes in regulatory and industry environments.
 
 The financial services industry continues to
evolve technologically, with an increasing number of firms of all sizes providing lower cost, computer-based “robo-advice”
and enhanced digital experiences for clients with previously limited personalized service. Industry and technology changes may result
in increased prevalence of robo-advisors. We are subject to risk from accelerated industry changes and competitive forces, which have
resulted and are expected to continue to result in significant costs for strategic initiatives to respond to such changes. Our ability
to compete in its industries is based primarily on a business model designed to serve clients through personalized relationships with
financial advisors offering a full-product suite complemented by a low-cost digital platform. We may be subject to operational
risk if its current business model is unable to keep pace with a rapidly changing environment, which includes client, industry, technology,
and regulatory changes. In addition, our ability to compete and adapt its business model may be impacted by changing client demographics,
preferences, and values. If our services do not meet client needs, it could lose clients, thereby reducing revenues and profitability.
 
 Talent competition among our competitors also
exists for financial advisors, technology specialists, and corporate staff. Our continued ability to expand its business and to compete
effectively depends on its ability to attract qualified employees and to retain and motivate current employees. Additionally, during
an economic downturn, there is increased risk that our successful personnel may leave or be hired away by its competitors, if we experience
reduced profitability.
 
 Competition may also result in continued pricing
pressures, which may lead to price reductions for our services and offerings and may adversely affect its profitability and market share.
In addition, we may face competition from its own customers or financial product providers, who may develop their own solutions internally
after they have gained experience and expertise independently or through their use of our solutions. If we are unable to successfully
compete in its relevant industries, its business, financial condition, and results of operations may be materially and adversely affected.
 
 21 

 If we are unable to protect or promote
its brand and reputation, its business may be materially and adversely affected. 
 
 Our brand names and reputation are subject to
a variety of factors that are beyond its control. For example, customer complaints about our services and negative publicity about the
financial services industry could diminish consumer confidence in our solutions. Failure to protect our customers’ privacy or effectively
adopt security measures could have the same effect. Measures that we may take from time to time to combat risks of fraud and breaches
of privacy and security can damage relations with its customers. These measures heighten the need for prompt and accurate customer service
to resolve irregularities. If we cannot handle customer complaints effectively or balance different customers’ needs appropriately,
its reputation may suffer, and we may lose customers’ confidence. Furthermore, we may be subject to claims seeking to hold it liable
for inaccurate or false information. Any claims, regardless of merit, may force us to participate in costly time-consuming litigation
or investigations, divert significant management and staff attention, and damage its reputation and brand. In addition, our reputation
may be undermined if its customers and product issuers, many of whom are financial institutions, violate laws and regulations such as
financial supervision regulations and anti-money laundering laws, when interacting with our solutions. Any significant damage to
our reputation, or to the perceived quality or awareness of its brands or solutions, or any significant failure by us to promote and
protect its brands and reputation, could make it more difficult for us to maintain a good relationship with its customers, promote its
services or retain qualified personnel, any of which may have a material adverse effect on our business.
 
 Our future marketing and efforts to build its
brands will likely require it to incur additional expenses. In 2022, AGBA changed the branding of many of its group companies to reflect
new brands, such as “AGBA”, “AGBA Focus”, “AGBA Perform” and “OnePlatform,” that align
with our new approach to the market.
 
 These re-branding efforts include obtaining
new trademark and domain name registrations, which efforts are ongoing. Increased marketing expenses in the short term may be required
to familiarize our customers and the public with these new brand names. These efforts may not result in increased revenues in the immediate
future or at all and, even if they do, any increases in revenues may not offset the expenses incurred. If we fail to successfully promote,
protect, and maintain its brands while incurring additional expenses, its results of operations and financial condition would be adversely
affected, and its ability to grow its business may be impaired.
 
 Breach of AGBA’s security measures
or those of any third-party cloud computing platform provider, or other third-party service providers, may result in AGBA’s data,
IT systems, and services being perceived as not being, or actually not being, secure. 
 
 Some of our services involve storage and transmission
of its customers’ and their end-customers’ proprietary and other sensitive data, including financial information and other
personally identifiable information. Our security measures may be breached as a result of efforts by individuals or groups of hackers
and sophisticated organizations, including by fraudulently obtaining system information of our employees or customers. Our security measures
also could be compromised by employee error or malfeasance, which could result in unauthorized access to, or denied authorized access
to, our IT systems, customers’ data, or its own data, including with respect to our intellectual property and other confidential
business information.
 
 Because the techniques used to breach, obtain
unauthorized access to, and sabotage IT systems change frequently, grow more complex over time, and are generally not recognized until
launched against a target, we may be unable to anticipate or implement adequate measures to prevent such techniques. In addition, we
are often an early adopter of new technologies and new ways of sharing data and communicating internally and with partners and customers.
As its IT systems continue to evolve, their complexity increases. In addition, our customers may authorize third-party technology
providers to access their customer data, and some of our customers may not have adequate security measures to protect their data that
is stored on our servers. Because we do not control its customers or third-party technology providers, or the processing of such
data by third-party technology providers, we cannot ensure the integrity or security of such transmissions or processing. Malicious
third parties may also conduct attacks designed to temporarily deny customers access to our services.
 
 22 

 A security breach could expose us to a risk of
loss or inappropriate use of proprietary and sensitive data, or the denial of access to this data. A security breach also could result
in a loss of confidence in the security of its services, damage our reputation, negatively impact future sales, disrupt its business,
and lead to legal liability. Finally, the detection, prevention, and remediation of known or potential security vulnerabilities, including
those arising from third-party hardware or software, may result in additional direct and indirect costs, for example, we may be
required to purchase additional infrastructure or its remediation efforts may degrade the performance of our solutions.
 
 Unexpected network interruptions, security
breaches, or computer virus attacks, and failures in AGBA’s information technology systems, could have a material adverse effect
on AGBA’s business, financial condition, and results of operations. 
 
 Our information technology systems support all
phases of its operations and are an essential part of the group’s technology infrastructure. The robust reliability of our platform
is one of its competitive strengths that it relies on to attract and retain customers. If our systems fail to perform, it could experience
disruptions in operations, slower response times, or decreased customer satisfaction. We must process, record, and monitor a large number
of transactions, and its operations are highly dependent on the integrity of its technology systems and its ability to make timely enhancements
and additions to such systems. System interruptions, errors, or downtime can result from a variety of causes, including unexpected interruptions
to the internet infrastructure, technological failures, changes to systems, changes in customer usage patterns, linkages with third-party systems,
and power failures. Our systems also are vulnerable to disruptions from human error, execution errors, errors in models such as those
used for risk management and compliance, employee misconduct, unauthorized trading, external fraud, computer viruses, denial of service
attacks, computer viruses or cyber-attacks, terrorist attacks, natural disasters, power outages, capacity constraints, software flaws,
events impacting our key business partners and vendors, and other similar events.
 
 AGBA has in the past experienced network interruptions,
which did not have a material adverse impact on the business. However, our business depends on the performance and reliability of its
internet infrastructure. There can be no assurance that our internet infrastructure will remain sufficiently reliable for its needs.
Any failure to maintain the performance, reliability, security, or availability of its network infrastructure may cause significant damage
to its ability to attract and retain customers. Major risks involving our network infrastructure include:
 
 ● breakdowns or
 system failures resulting in a prolonged shutdown of its servers; 

 ● disruption or
 failure in the national backbone networks in Hong Kong, China, and the other markets
 where AGBA operates, which would make it impossible for customers to access our solutions; 

 ● damage from natural
 disasters or other catastrophic events such as typhoons, volcanic eruptions, earthquakes,
 floods, telecommunications failures, or other similar events; and 

 ● any infection
 by or spread of computer viruses or other system failures. 

 Any network interruption or inadequacy that causes
interruptions in the availability of our platform or deterioration in the quality of or access to its solutions could reduce customer
satisfaction and result in a reduction in the activity level of our customers. Furthermore, increases in the volume of traffic on our
platform could strain the capacity of its existing computer systems and bandwidth, which could lead to slower response times or system
failures. This strain could cause a disruption or suspension in our services delivery, which could, in turn, hurt its brand and reputation.
We may need to incur additional costs to upgrade its technology infrastructure and computer systems to accommodate increased demand if
it anticipates that its systems cannot handle higher volumes of traffic and transaction in the future. In addition, it could take an
extended period to restore full functionality to our technology or other operating systems in the event of an unforeseen occurrence,
which could affect our ability to deliver its solutions. There can be no assurance that we will not suffer unexpected losses, reputational
damage, or regulatory actions due to technology or other operational failures or errors, including those of our vendors or other third
parties.
 
 23 

 AGBA’s inability to use software
licensed from third parties, including open-source software, could negatively affect its ability to sell its solutions and subject it
to possible litigation. 
 
 Our technology platform incorporates software
licensed from third parties, including open-source software, which we use without charge. Although we monitor its use of open-source software,
the terms of many open-source licenses that it is subject to have not been interpreted by courts, and there is a risk that these
licenses could be construed to impose unanticipated conditions or restrictions on its ability to provide its solutions. In addition,
the terms of open-source software licenses may require us to provide software that it develops to others on unfavorable license
terms. For example, certain open-source licenses may require us to offer the components of its platform that incorporate open-source software
for free, to make source code for modifications or derivative works available to others, and to license such modifications or derivative
works under the terms of the particular open-source license.
 
 In addition, we could be required to seek licenses
from third parties to continue offering its solutions, and these types of licenses may not be available or may be on terms not acceptable
to us. Alternatively, we may need to re-engineer its solutions or discontinue using certain functionalities of its solutions.
Our inability to use third-party software could result in business disruptions, or delays in developing future offerings or enhancements
of its existing solutions, which could materially and adversely affect our business and results of operations.
 
 AGBA’s business in the credit industry
requires sufficient liquidity to maintain its business activities, and it may not always have access to sufficient funds. 
 
 Liquidity, or ready access to funds, is essential
to our business, particularly its money lending business through OnePlatform Credit Limited (“OCL”) and Hong Kong Credit
Corporation Limited (“HKCC”). A tight credit market could have a negative impact on the ability of either or both of OCL
and HKCC to maintain sufficient liquidity to meet their working capital needs and to meet regulatory requirements. Short-term and
long-term financing are two sources of liquidity that could be affected by a tight credit market. In a tight credit market, lenders
may reduce their loan amounts. There can be no assurance that financing will be available at attractive terms, or at all, in the future.
 
 Additionally, our access to funds held at a broker-dealer is
subject to regulatory capital requirements and may require approval from regulators. A significant decrease in our access to funds could
negatively affect its business, financial management, and reputation in the industry.
 
 AGBA is subject to credit risk due to the
nature of the transactions it processes for its clients. 
 
 We are exposed to the risk that third parties
who owe it money, securities, or other assets will not meet their obligations. Many of the transactions in which AGBA engages expose
it to credit risk in the event of default by its counterparty or client, such as loans or cash balances held at major financial institutions.
In addition, our credit risk may be increased when the collateral it holds cannot be realized or is liquidated at prices insufficient
to recover the full amount of the obligation due to us. Financial instruments that potentially subject us to credit risk consist
of cash equivalents, restricted cash, accounts, and loans receivable. Cash equivalents are maintained with high credit quality institutions,
the composition and maturities of which are regularly monitored by management. The Hong Kong Deposit Protection Board pays compensation
up to a limit of HK$500,000 (approximately US$64,050) if the bank with which an individual/a company hold its eligible deposit fails.
We maintain cash and other funds in escrow at financial institutions in Hong Kong, which can be subject to credit risk. While management
believes that these financial institutions are of high credit quality, it also continually monitors their credit worthiness, and there
can be no assurance that they will remain of high credit quality.
 
 We have evaluated the need for an allowance for
doubtful accounts based upon factors surrounding the credit risk of specific customers, historical trends, and other information. Nonetheless,
there can be no assurance that its customers will not default on their obligations or otherwise expose us to the negative impacts of
credit risk.
 
 24 

 Restrictions imposed by the outstanding
indebtedness and any future indebtedness of AGBA may limit its ability to operate its business and to finance its future operations or
capital needs or to engage in acquisitions or other business activities necessary to achieve growth. 
 
 The terms of the outstanding indebtedness and
any future indebtedness may restrict us from taking certain actions, including, among other things:
 
 ● incurring additional
 indebtedness; 

 ● creating or incurring
 liens; 

 ● paying dividends
 and distributions on, or purchase, redeem, defease, or otherwise acquire or retire for value,
 capital stock; 

 ● making repayments
 or repurchases of debt that is contractually subordinated with respect to right of payment
 or security; 

 ● creating negative
 pledges or restrictions on the payment of dividends or payment of other amounts owed from
 subsidiaries; 

 ● making acquisitions,
 investments, loans (including guarantees), advance or capital contributions; 

 ● engaging in consolidations,
 amalgamations, mergers, liquidations, dissolutions, dispositions and/or selling, transferring,
 or otherwise disposing of assets, including capital stock of subsidiaries; 

 ● entering into
 certain sale and leaseback transactions; 

 ● engaging in certain
 transactions with affiliates; or 

 ● changing material
 lines of business. 

 There can be no guarantee that we will be able
to maintain compliance with any of its loan covenants or, if we fail to do so, that it will be able to obtain waivers from the lenders
and/or amend the covenants. Even if we comply with all of the applicable covenants, the restrictions on the conduct of business could
adversely affect us by, among other things, limiting its ability to take advantage of financings, mergers, acquisitions, investments,
and other corporate opportunities that may be beneficial to business.
 
 A breach of any of the covenants in existing
or future credit agreements could result in an event of default, which, if not cured or waived, could trigger acceleration of indebtedness
and an increase in the interest rates applicable to such indebtedness, and may result in the acceleration of or default under any other
debt we may incur in the future to which a cross-acceleration or cross-default provision applies. Any such acceleration of
indebtedness could have a material adverse effect on the business, results of operations, and financial condition of AGBA. In the
event of any default under existing or future credit facilities of AGBA, the applicable lenders could elect to terminate borrowing commitments
and declare all borrowings and loans outstanding, together with accrued and unpaid interest and any fees and other obligations, to be
due and payable. In addition, if AGBA was to grant a security interest in a significant portion of its assets to secure obligations under
a lending agreement, the applicable lenders, during the existence of an event of default, could exercise their rights and remedies thereunder,
including by way of initiating foreclosure proceedings against any assets constituting collateral for obligations of AGBA as borrower.
 
 AGBA’ performance depends on key
management and personnel. Any failure to attract, motivate and retain staff could severely hinder AGBA’s ability to maintain and
grow AGBA. 
 
 Our future success is significantly dependent
upon the continued service of a handful of its key personnel. If we lose the services of any member of management or other key personnel,
it may not be able to locate suitable or qualified replacements, and it may incur additional expenses to recruit and train new staff,
which could severely disrupt its business and growth, therefore materially and adversely affecting our business, financial condition,
results of operations, and prospects. If any dispute arises between our current or former personnel, we may have to incur substantial
costs and expenses in order to enforce such agreements in Hong Kong or elsewhere (as relevant), and we may not be able to enforce them
at all.
 
 The wide range and diversity of the services
and solutions that we provide may require the hiring and retention of a wide range of experienced personnel who can adapt to a dynamic,
competitive, and challenging business environment. We will need to continue to attract and retain experienced and capable personnel at
all levels as it expands its business and operations. Competition for talent in Hong Kong’s financial technology industry
is particularly intense, and the availability of suitable and qualified candidates is limited.
 
 25 

 Substantially all of AGBA’s operations
are housed in one location. If the facilities are damaged or rendered inoperable by natural or man-made disasters, AGBA’s business
may be negatively impacted. 
 
 The current headquarters adopts an open-office design
throughout the entire building to minimize overall expenses, promote collaborative culture, and create a more flexible workspace environment.
 
 As a result, most of our operations currently
are housed in one building. Certain of our subsidiaries compensate the Legacy Group for the use of their office space through existing
service agreements. See “ Certain Transactions and Related Party Transactions — Certain Transactions of AGBA ”.
AGBA Tower, and our offices therein, could be harmed or rendered inoperable by natural or man-made disasters, including earthquakes,
fires, power shortages, telecommunications failures, water shortages, floods, hurricanes, typhoons, extreme weather conditions, medical
epidemics, and other natural or man-made disasters, pandemics, epidemics, or other business interruptions, including the COVID-19 pandemic.
If due to such disaster a significant portion of our team members must work remotely for an extended period, our business may be negatively
impacted.
 
 On January 25, 2022, we purchased an office
premise located at Kaiseng Commercial Centre, No 4 & 6, Hankow Road, Kowloon, Hong Kong from the Legacy Group for
a consideration of approximately US$8.0 million. The purchase price was offset by the deduction of a previously paid earnest deposit
of US$7.2 million and partially settled by cash. Our management expects to use this office premise for its own occupancy and to
meet its anticipated business expansion in the foreseeable period. This transaction is not expected to affect the existing AGBA Tower
lease or current administrative service agreements.
 
 AGBA may not be able to identify or pursue
suitable acquisition or expansion opportunities or achieve optimal results in future acquisitions or expansions, and it may encounter
difficulties in successfully integrating and developing acquired assets or businesses. 
 
 To further grow its businesses and increase its
competitiveness and profitability, we intend to continue expanding its services and solutions in both Hong Kong and China. We have
been actively looking for acquisition or expansion opportunities that may be beneficial. Over the past few years, Fintech has invested
in a number of companies in the fintech space, such as Tandem. We will continue to seek opportunities for acquisition and expansion.
However, acquisitions or expansions may not be successfully completed, and we may not be able to find or consummate suitable acquisition
or expansion alternatives. Any expansion of AGBA into China may also involve risks related to businesses operating in China. If we successfully
complete any acquisition or expansion, it may raise financing, either in the capital markets or in the form of bank financing, to cover
all or part of the purchase price, which will lead to changes to our capital structure and may restrict us in other ways. In addition,
to the extent that any of these business initiatives are funded through the issuance of equity or convertible debt securities, the ownership
interest of our shareholders could be diluted.
 
 We have acquired and may in the future acquire
other businesses or companies with advanced financial technologies, leading financial technology products, valuable intellectual property,
or other businesses or assets with capabilities and strategies that our management believes are complementary to and are likely to enhance
its businesses. However, there can be no assurance that we will be able to identify attractive acquisition targets, negotiate favorable
terms, obtain necessary government approvals or permits, complete necessary registrations or filings, or obtain necessary funding to
complete these acquisitions on commercially acceptable terms, or at all.
 
 Acquisitions and expansions involve numerous
risks, including potential difficulties in retaining and assimilating personnel, risks and difficulties associated with integrating the
operations and culture of AGBA, diversions of management attention and other resources, lack of experience and industry and market knowledge
of the new businesses, risks and difficulties associated with complying with laws and regulations related to the acquisitions and failure
to properly identify problems with acquisition targets through the due diligence process. In addition, acquisitions and expansions may
significantly stretch our capital, personnel, and management resources and, as a result, we may fail to manage its growth effectively.
Any new acquisition or expansion plans may also result in its inheritance of debts and other liabilities, assumption of potential legal
liabilities in respect of the new businesses, and incurrence of impairment charges related to goodwill and other intangible assets, any
of which could harm our business, financial condition, and results of operations. In particular, if any new businesses we acquire fail
to perform as expected, we may be required to recognize a significant impairment charge, which could materially and adversely affect
its business, financial condition, and results of operations. There may also be established players in these sectors and markets that
enjoy significant market share, and it may be difficult for us to win market share from them. Furthermore, some of the overseas markets
that we may target may have high barriers of entry for foreign players. There can be no assurance that our acquisition or expansion plans
will be successful. As a result, there can be no assurance that we will be able to realize the strategy behind an acquisition or expansion
plan, reach the desired level of operational integration, or achieve its investment return targets.
 
 26 

 AGBA and its directors, management, and
employees currently are and may in the future be subject to litigation and regulatory investigations and proceedings, and any adverse
findings may have a material adverse effect on AGBA’s business, results of operations, financial condition, and prospects and harm
its reputation. 
 
 Many aspects of our business involve substantial
litigation and regulatory risks, and our members and management may be subject to claims and lawsuits in the ordinary course of their
business or in connection with the Legacy Group. We are also, from time to time, subject to examinations, informal inquiries and investigations
by regulatory and other governmental agencies. In the ordinary course of business, we are also subject to arbitration claims, lawsuits,
and litigation, either as plaintiff or defendant.
 
 Actions brought against us may result in settlements,
injunctions, fines, penalties, or other results adverse to the directors, management, and employees that could harm its business, financial
condition, results of operations, and reputation. Any action against our directors, management, and employees, even those without merit
and even if the relevant party is successful in defending itself against them, may cause us to incur significant costs, and could place
a strain on its financial resources, divert the attention of management from its core business, and harm its reputation. A significant
judgment or regulatory action against our directors, management, and employees or a material disruption in the business of AGBA arising
from adverse adjudications in proceedings against its directors, officers or employees would have a material adverse effect on its liquidity,
business, financial condition, results of operations, reputation, and prospects.
 
 As a publicly listed company, we are likely to
face additional exposure to claims and lawsuits. These claims could divert management’s time and attention away from its business
and result in significant costs to investigate and defend, regardless of the merits of the claims. In some instances, we may elect or
be forced to pay substantial damages if it is unsuccessful in its efforts to defend against these claims, which could harm its reputation,
business, financial condition, and results of operations.
 
 We implement policies and conduct regular compliance
training designed to deter wrongdoing, promote honest and ethical conduct, and ensure the accuracy of financial statements and public
communications as well as compliance with applicable governmental laws, rules, and regulations. However, there can be no assurance that
all of our directors, management, and employees will strictly abide by these rules and policies, or that we can effectively and timely
deter, detect, and remedy all misconduct. Any gross misconduct by our directors, management, and employees, including, but not limited
to those in relation to commercial, labor, employment, financial, operational, accounting, auditing or securities matters, may lead to
investigations and/or litigation and have a material adverse impact on our business, financial condition and results of operations, and
harm its reputation.
 
 We may not have sufficient insurance coverage
to cover our business risks. 
 
 We maintain insurance to cover its potential exposure
for claims and losses. However, our insurance coverage may be inadequate or unavailable to protect us fully, and we may not be able to
acquire any coverage for certain types of risks such as business liability or service disruptions, and our coverage may not be adequate
to compensate us for all losses that may occur, particularly with respect to loss of business or operations. Any business disruption,
litigation, regulatory action, outbreak of epidemic disease, or natural disaster could also expose us to substantial costs and resource
diversion. There can be no assurance that our existing insurance coverage will be sufficient to prevent us from any loss or that we will
be able to successfully claim our losses on a timely basis, or at all. If we incur any loss that is not covered by its existing insurance
policies, or the amount of compensation that it receives is significantly less than its actual loss, our business, financial condition
and results of operations could be materially and adversely affected.
 
 Any failure to protect the intellectual
property rights of AGBA or its subsidiaries or to ensure the continuing right to own, use or license all intellectual property required
for its or their operations could impair AGBA’s ability to protect its proprietary technology and its brand. 
 
 Our success and ability to compete depends in
part upon its intellectual property. As of the date of this report, our portfolio of intellectual property includes, primarily, domain
names and trademarks. We are currently in the process of re-branding its business, and as part of this exercise, we is in the process
of obtaining domain names and trademark registrations for its new brands, such as “AGBA”, “AGBA Focus”, “AGBA
Perform” and “OnePlatform.” We primarily rely on copyright, trade secret and trademark laws, trade secret protection
and confidentiality or license agreements with our employees, customers, partners and others to protect our intellectual property rights.
 
 27 

 The steps that we take to secure, protect, and
enforce its current and future intellectual property rights may be inadequate. We may not be able to obtain any further trademarks (including
those for “AGBA” and “OnePlatform”) or patents, our current intellectual property could be invalidated, our competitors
could design their products around our current technology, or we could lose access to third party intellectual property on which we may
rely.
 
 In order to protect our intellectual property
rights, we may be required to spend significant resources to monitor and protect these rights. Litigation brought to protect and enforce
our intellectual property rights could be costly, time consuming and distracting to our management and could result in the impairment
or loss of its 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. Accordingly, we may not be able to prevent
third parties from infringing upon or misappropriating its intellectual property. Any failure to secure, protect and enforce its intellectual
property rights could substantially harm the value of our technology, products, brand, and business.
 
 We may not be able to prevent others from
unauthorized use of our intellectual property, which could harm our business and competitive position. 
 
 We regard our trademarks, domain names, trade
secrets, and other intellectual property as critical to our business. Unauthorized use of our intellectual property by third parties may
adversely affect our business and reputation. We rely on a combination of intellectual property laws and contractual arrangements to protect
our proprietary rights. It is often difficult to register, maintain, and enforce intellectual property rights in countries or regions
with less developed regulatory regimes or inconsistent and unreliable enforcement mechanisms. Sometimes laws and regulations are subject
to interpretation and enforcement and may not be applied consistently due to the lack of clear guidance on statutory interpretation. Legal
standards relating to the validity, enforceability, and scope of protection of intellectual property rights in other countries are uncertain
and may afford little or no effective protection of our proprietary technology, and the risk of intellectual property misappropriation
may be higher in these countries. Consequently, we may be unable to prevent its proprietary technology from being infringed or exploited
abroad, which could affect its ability to expand into international markets or require costly efforts to protect its technology. We are
in the process of obtaining new domain names and trademark registrations in connection with its ongoing re-branding efforts. Failure
to promptly obtain such registrations or otherwise fully project such intellectual property may expose us to intellectual property related
risks, which may materially and adversely affect its business, financial condition and results of operations.
 
 In addition, our contractual agreements, including
IP assignment arrangements in employment contracts, may be breached by counterparties, and there may not be adequate remedies available
to us for any such breach. Accordingly, we may not be able to effectively protect its intellectual property rights or to enforce its
contractual rights in Hong Kong, China, or other jurisdictions in which we operate. Detecting and preventing any unauthorized use
of our intellectual property is difficult and costly, and the steps has taken may be inadequate to prevent infringement or misappropriation
of its intellectual property. If we resort to litigation to enforce or protect its intellectual property rights, such litigation could
result in substantial costs and a diversion of its managerial and financial resources. There can be no assurance that we will prevail
in such litigation. In addition, our trade secrets may be leaked or otherwise become available to, or be independently discovered by,
its competitors, and, in that case, we would have no right to prevent others’ use of them.
 
 We may be subject to intellectual property
infringement claims, which may be expensive to defend and may disrupt its business and operations. 
 
 There can be no certainty that the operations
or any aspects of our business do not or would not infringe upon or otherwise violate patents, copyrights, trademarks, or other intellectual
property rights held by third parties. We may be subject to penalties, legal proceedings, and claims relating to the intellectual property
rights of others. In addition, there may be other third-party intellectual property that is infringed by our solutions, services,
or other aspects of its business. There could also be intellectual property rights that we are not aware of that our solutions or services
may inadvertently infringe. To the extent that we seek to register any new intellectual property, there can be no assurance that such
applications will be approved, that any issued intellectual property rights would adequately protect our intellectual property, or that
such intellectual properties would not be challenged by third parties or found by competent authority to be invalid or unenforceable.
 
 28 

 There can be no assurance that holders of patents
purportedly relating to some aspect of our technology platform or business, if any such holders exist, would not seek to enforce these
patents against us in Hong Kong, China, or any other jurisdictions. Furthermore, the application and interpretation of PRC patent
laws and the procedures and standards for granting patents in the PRC are still evolving and are uncertain, and there can be no assurance
that PRC courts or regulatory authorities would agree with our analysis. If we are found to have violated the intellectual property rights
of others, it may be subject to liability for its infringement activities or may be prohibited from using such intellectual property,
and it may incur licensing fees or be forced to develop alternatives of its own. In addition, we may incur significant expenses, and
may be forced to divert management’s time and other resources from its business and operations to defend against these third-party infringement
claims, regardless of their merits. Successful infringement or licensing claims made against us may result in significant monetary liabilities
and may materially disrupt its business and operations by restricting or prohibiting its use of the intellectual property in question,
which may materially and adversely affect its business, financial condition, and results of operations.
 
 Additionally, registering, managing, and enforcing
intellectual property rights in the PRC is often difficult. Statutory laws and regulations may not be applied consistently due to the
lack of clear interpretation guidance.
 
 We have registered for certain trademarks in
Hong Kong, China, and Taiwan. However, third parties may file applications to register the same or similar trademarks. In addition,
third parties may object its registrations, and the relevant trademark authority may not rule in our favor in such disputes. If our trademarks
are revoked or otherwise canceled, we may be prohibited from using those trademarks in its business operations, and we may need to change
certain of its products logos, which may have an adverse effect on its business and operations.
 
 We are party to a number of related party
transactions, which may result in interdependence or potential conflicts of interest. 
 
 In the ordinary course of their business, our
subsidiaries enter into transactions with related parties. Related parties may be individuals (being members of key management personnel
and/or their close family members) or other entities and include entities which are under the significant influence of related parties
of the Group and the Legacy Group. Such interdependence may mean that any material adverse changes in the operations or financial condition
of related parties could adversely affect our results of operations. We expect that it will continue to enter into transactions with related
parties.
 
 While we employ strong corporate governance provisions
and related party transaction policies that require such transaction to be conducted on an arm’s length basis, there can be no
assurance that relevant government regulators will make the same conclusion with respect to such transactions. Further, there can be
no assurance that such related party transactions, if questioned, will not have an adverse effect on our business or results of operations.
 
 We operate in a variety of heavily regulated
industries in Hong Kong and globally, which expose its business activities to risks of noncompliance with an increasing body of complex
laws and regulations. 
 
 Due to the heavily regulated nature of the industries
in which we operate, primarily the insurance, Mandatory Provident Fund (MPF), asset management and money lending industries, we are required
to comply with a wide array of Hong Kong laws and regulations that regulate, among other things, the manner in which they conduct
their businesses, which of our operating entities can provide certain services, and the fees that they may charge. Governmental authorities
and various Hong Kong agencies, including, among others, the Insurance Authority, the Mandatory Provident Fund Authority, the Securities
and Futures Commission, and the Inland Revenue Department, have broad oversight and supervisory authority over us.
 
 Because of the financial services that we offer
and deliver, we engage in the relevant service must be licensed in Hong Kong as well as all relevant jurisdictions that require
licensure and must comply with each such jurisdiction’s respective laws and regulations, as well as with judicial and administrative
decisions applicable to it. Presently, in Hong Kong, we maintain Insurance Broker Licenses, HKSFC Licenses, and Money Lenders Licenses,
in addition to their business registrations with the Hong Kong Companies Registry. In addition, these companies are currently subject
to a variety of, and may in the future become subject to additional, laws that are continuously evolving and developing, including laws
on advertising as well as privacy laws.
 
 29 

 These licensing requirements and other regulations
directly impact our business and require ongoing compliance, monitoring, and internal and external audits as they continue to evolve
and may result in ever-increasing public scrutiny and escalating levels of enforcement and sanctions. Subsequent changes to data
protection and privacy laws, for instance, could impact how we process personal information, and therefore limit the effectiveness of
its products or services or its ability to operate or expand its business, including limiting strategic partnerships that may involve
the sharing of personal information.
 
 Both the scope of the laws and regulations and
the intensity of the supervision to which we are subject have increased over time, in response to financial crises as well as other factors
such as technological and market changes. Regulatory enforcement and fines have also increased across the financial services sector in
Hong Kong and the other markets where we operate. Our management expects that its business will remain subject to extensive regulation
and supervision. These regulatory changes could result in an increase in our regulatory compliance burden and associated costs and place
restrictions on its operations. Our failure to comply with applicable licensing requirements and relevant laws and regulations could
lead to, among other things:
 
 ● loss of its licenses
 and approvals to engage in its businesses; 

 ● damage to its
 reputation in the industry; 

 ● governmental investigations
 and enforcement actions; 

 ● administrative
 fines and penalties and litigation; 

 ● civil and criminal
 liability, including class action lawsuits; 

 ● increased costs
 of doing business; 

 ● diminished ability
 to sell financial products; 

 ● inability to raise
 capital; and 

 ● inability to execute
 on its business strategy, including its growth plans. 

 As applicable licensing requirements and laws
evolve, it may be more difficult for our management to identify these developments comprehensively, to interpret changes accurately, and
to train our employees effectively with respect to these laws and regulations. These difficulties potentially increase our exposure to
the risks of noncompliance with these licensing requirements, laws, and regulations, which could be detrimental to its business. In addition,
a failure to adequately vet and supervise our clients, service providers and vendors, to the extent they are covered by such licensing
requirements, laws, and regulations, may also have these negative results.
 
 To resolve issues raised in examinations or other
governmental actions, we or certain of our subsidiaries may be required to take various corrective actions, including changing certain
business practices, making refunds or taking other actions that could be financially or competitively detrimental to it. Our management
expects to continue to incur costs to comply with governmental regulations. In addition, certain legislative actions and judicial decisions
can give rise to the initiation of lawsuits against us for activities that it has conducted in the past. We have been, and its management
expects it to continue to be, subject to regulatory enforcement actions and private causes of action from time to time with respect to
its compliance with applicable laws and regulations.
 
 Although we have systems and procedures directed
to comply with these legal and regulatory requirements, there can be no assurance that more restrictive laws and regulations will not
be adopted in the future, or that governmental bodies or courts will not interpret existing laws or regulations in a more restrictive
manner, which could render its current business practices non-compliant or which could make compliance more difficult or expensive. Any
of these, or other, changes in laws or regulations could have a detrimental effect on us and its results of operations.
 
 30 

 We are subject to evolving regulatory requirements,
and failure to comply with these regulations or to adapt to regulatory changes could materially and adversely affect its operations,
business, and prospects. 
 
 Many
of our aspects, including brokerage and technology services to individual investors, banks, and insurance companies, insurance loss adjustment
services, online publication services relating to financial product information, facilitating consumer lending products for banks and
online small loan companies, managing and distributing various asset management products, and electronic certification services are subject
to supervision and regulation by various governmental authorities in Hong Kong or in other jurisdictions where we operate. As we continue
to expand its solutions and product offerings, the group may be subject to new and more complex regulatory requirements. 
 
 We are also required to comply with
applicable laws and regulations in relevant jurisdictions to protect the privacy and security of its customers’ information. Legal
and regulatory restrictions may delay, or possibly prevent, some of our solutions or services from being offered, which may have a material
adverse effect on its business, financial condition, and results of operations. Violation of laws and regulations may also result in
severe penalties, confiscation of illegal income, revocation of licenses and, under certain circumstances, criminal prosecution.
 
 For example, the regulatory framework governing
financial technology services is unclear and evolving. New laws or regulations may be promulgated, which could impose new requirements
or prohibitions that render our current operations or technologies non-compliant. In addition, due to uncertainties and complexities
of the regulatory environment, it cannot be assured that regulators will interpret laws and regulations the same way as we do, or that
we will always be in full compliance with applicable laws and regulations. To remedy any violations, we may be required to modify its
business models, solutions, and technologies in ways that render its solutions less appealing to potential customers. We may also become
subject to fines or other penalties, or, if we determine that the requirements to operate in compliance are overly burdensome, it may
elect to terminate potentially non-compliant operations. In each such case, our business, financial condition and results of operations
may be materially and adversely affected.
 
 We may be adversely affected by the complexity,
uncertainties, and changes in regulation of internet-related businesses and companies, and any lack of requisite approvals, licenses,
or permits applicable to our business may have a material adverse effect on its business and results of operations. 
 
 The Hong Kong government extensively regulates
the internet industry, including foreign ownership of, and the licensing and permit requirements pertaining to, companies in the industry.
These internet-related laws and regulations are relatively new and evolving, and their interpretation and enforcement involve significant
uncertainties. As a result, in certain circumstances it may be difficult to determine what actions or omissions may be deemed to be in
violation of applicable laws and regulations.
 
 The interpretation and application of existing
Hong Kong laws, regulations and policies, and possible new laws, regulations, or policies, including those relating to the internet
industry, have created substantial uncertainties regarding the legality of existing and future foreign investments in, and our businesses
and activities. There can be no assurance that we have obtained all the permits or licenses required for conducting its business
or that it will be able to maintain or update its existing licenses or obtain new ones. If a government authority considers that we were
operating without the proper approvals, licenses, or permits or promulgates new laws and regulations that require additional approvals
or licenses or imposes additional restrictions on the operation of any part of its business, it may levy fines, confiscate our income,
revoke its business licenses, and/or require us to discontinue its relevant business or impose restrictions on the affected portion of
its business. Any of these actions may have a material adverse effect on our business and results of operations.
 
 Uncertainties in the interpretation and
enforcement of Hong Kong laws and regulations could limit the legal protections available to us and our investors. 
 
 Hong Kong laws and regulations concerning
the internet-related and financial services industries are developing and evolving. Although we have taken measures to comply with
the laws and regulations applicable to its business operations and to avoid conducting any non-compliant activities under these
laws and regulations, governmental authorities may promulgate new laws and regulations regulating the internet-related and financial
services industries. There can be no assurance that our operations would not be deemed to violate any such new laws or regulations. Moreover,
developments in the internet-related industries and financial services industry may lead to changes in existing laws, regulations,
and policies in Hong Kong, or in the interpretation and application of existing laws, regulations, and policies, which in turn may
limit or restrict us and could materially and adversely affect its business and operations.
 
 31 

 Fluctuations in exchange rates could have
a material adverse effect on our results of operations and the price of the Company’s shares. 
 
 The value of the Hong Kong dollar against
the U.S. Dollar and other currencies may fluctuate and is affected by, among other things, changes in political and economic conditions
in Hong Kong and China and by Hong Kong and China’s foreign exchange policies. Presently, the value of the Hong Kong
dollar is pegged to the U.S. Dollar. However, on July 21, 2005, the PRC government changed its decade-old policy of pegging
the value of the Renminbi to the U.S. Dollar, and the Renminbi appreciated more than 20% against the U.S. Dollar over the following
three years. Between July 2008 and June 2010, this appreciation halted and the exchange rate between the Renminbi and
the U.S. Dollar remained within a narrow band. Since June 2010, the Renminbi has fluctuated against the U.S. Dollar, at
times significantly and unpredictably. On November 30, 2015, the Executive Board of the International Monetary Fund (IMF) completed
the regular five-year review of the basket of currencies that make up its Special Drawing Rights, or the SDR, and decided that with
effect from October 1, 2016, the Renminbi is considered to be a freely usable currency and will be included in the SDR basket as
a fifth currency, along with the U.S. Dollar, the Euro, the Japanese yen and the British pound. With the development of the foreign
exchange market and progress towards interest rate liberalization and Renminbi internationalization, the PRC government may announce
further changes to its exchange rate system. Given the political uncertainty surrounding Hong Kong, there can be no assurance that
the Hong Kong dollar will remain pegged to the U.S. Dollar and that it will not appreciate or depreciate significantly in value
against the U.S. Dollar in the future. It is difficult to predict how market forces or Hong Kong, PRC, or U.S. government
policies may affect the exchange rate between the Hong Kong dollar and the U.S. Dollar in the future.
 
 Substantially all of our revenue and costs are
denominated in Hong Kong dollars. Any significant revaluation of the Hong Kong dollar may have a material and adverse effect
on an investment in the Company. For example, to the extent that the Company needed to convert U.S. Dollars received from the Business
Combination or other capital markets transactions or borrowings outside Hong Kong into Hong Kong dollars for operations, appreciation
of the Hong Kong dollar against the U.S. Dollar would have an adverse effect on the amount the Company would receive from the
conversion. Conversely, if the Company decided to convert its Hong Kong dollars into U.S. Dollars for the purpose of making
payments for dividends on its ordinary shares or for other business purposes, appreciation of the U.S. Dollar against the Hong Kong
dollar would have a negative effect on the U.S. Dollar amount available to the company.
 
 We face risks related to natural disasters,
health epidemics, civil and social disruption and other outbreaks, which could significantly disrupt its operations. 
 
 We are vulnerable to natural disasters and other
calamities. Fire, floods, typhoons, earthquakes, power losses, telecommunications failures, break-ins, wars, riots, terrorist attacks,
strikes, civil or social disruption (including protests in Hong Kong in June 2019) or similar events may give rise to server
or service interruptions, breakdowns, system failures, technology platform failures, employee issues, or internet failures, which could
cause the loss or corruption of data or malfunctions of software or hardware, as well as adversely affect our ability to maintain its
financial platform and provide its solutions to customers. Our business could also be adversely affected by the effects of COVID-19,
Ebola virus disease, Zika virus disease, various forms of influenza, Severe Acute Respiratory Syndrome or SARS, or other epidemics.
 
 Our business, results of operations, financial
conditions, and prospects could also be adversely affected to the extent that any natural disasters, health epidemics, civil and social
disruption and other outbreaks harm the Hong Kong, Chinese, or global economy in general.
 
 Russia’s invasion of Ukraine may present
risks to our operations and investments. 
 
 Russia’s recent military interventions in
Ukraine have led to, and may lead to, additional sanctions being levied by the United States, European Union and other countries
against Russia. Russia’s military incursion and the resulting sanctions could adversely affect global energy and financial markets
and thus could affect the value of our investments, even though we do not have any direct exposure to Russia or the adjoining geographic
regions. The extent and duration of the military action, sanctions, and resulting market disruptions are impossible to predict, but could
be substantial. Any such disruptions caused by Russian military action or resulting sanctions may magnify the impact of other risks described
in this section. We cannot predict the progress or outcome of the situation in Ukraine, as the conflict and governmental reactions are
rapidly developing and beyond their control. Prolonged unrest, intensified military activities, or more extensive sanctions impacting
the region could have a material adverse effect on the global economy, and such effect could in turn have a material adverse effect on
our operations, results of operations, financial condition, liquidity and business outlook.
 
 32 

 Risks Related to Our Shares 
 
 Our share price has been, and could continue
to be, volatile. 
 
 There has been significant volatility in the
market price and trading volume of equity securities, which may be unrelated to the financial performance of the companies issuing the
securities. These broad market fluctuations could negatively affect the market price of our stock. The market price and volume of our
ordinary shares could fluctuate, and in the past has fluctuated, more dramatically than the stock market in general. During the 12 months
ended December 31, 2022, the market price of our ordinary shares has ranged from a high of $11.65 per share (on November 3, 2022)
to a low of $1.54 per share (on December 30, 2022). Shareholders may not be able to resell their shares at or above the price they paid
for them due to fluctuations in the market price of our stock caused by changes in our operating performance or prospects or other factors.
Some factors, in addition to the other risk factors identified above, that could have a significant effect on our stock market price
include, but are not limited to, the following:
 
 ● actual or anticipated
 fluctuations in our operating results or future prospects; 

 ● our announcements
 or our competitors’ announcements of new services; 

 ● the public’s
 reaction to our press releases, our other public announcements and our filings with the SEC; 

 ● strategic actions
 by us or our competitors, such as acquisitions or restructurings; 

 ● new laws or regulations
 or new interpretations of existing laws or regulations applicable to our business; 

 ● changes in accounting
 standards, policies, guidance, interpretations, or principles; 

 ● changes in our
 growth rates or our competitors’ growth rates; 

 ● developments regarding
 our patents or proprietary rights or those of our competitors; 

 ● our inability
 to raise additional capital as needed; 

 ● concerns or allegations
 as to the safety or efficacy of our products; 

 ● changes in financial
 markets or general economic conditions; 

 ● sales of shares
 by us or members of our management team, our significant shareholders, or certain institutional
 shareholders; and 

 ● changes in stock
 market analyst recommendations or earnings estimates regarding our stock, other comparable
 companies or our industry generally. 

 Shareholders could experience substantial
dilution of their investment as a result of future sales of our equity, subsequent exercises of our outstanding warrants and options,
or the future grant of equity by us. 
 
 We may choose to raise additional capital from
time to time, even if we believe we have sufficient funds for our current or future operating plans. To the extent that we raise additional
funds through the future sale of equity or convertible securities, the issuance of such securities will result in dilution to our stockholders.
The price per share at which we sell additional ordinary shares, or securities convertible or exchangeable into ordinary shares, in future
transactions may be higher or lower than the price per ordinary share paid by investors in the offering. Investors purchasing shares
or other securities in the future could have rights superior to existing stockholders.
 
 33 

 In addition, shareholders could experience substantial
dilution of their investment as a result of subsequent exercises of outstanding warrants, or the grant of future equity-based awards.
As of December 31, 2022, an aggregate of 5,946,100 ordinary shares were reserved for issuance under our equity incentive plans,
and 4,825,000 ordinary shares were subject to warrants at an exercise $11.50 per share. To the extent that outstanding warrants are exercised,
our existing shareholders could experience dilution.
 
 We rely on equity awards to motivate current
employees and to attract new employees. The grant of future equity awards by us to our employees and other service providers could further
dilute our shareholders’ interests in the Company.
 
 Because we do not intend to pay cash dividends,
our stockholders will benefit from an investment in our ordinary shares only if it appreciates in value. 
 
 We intend to retain our future earnings, if any,
to finance the expansion of our business and do not expect to pay any cash dividends in the foreseeable future. As a result, the success
of an investment in our ordinary shares will depend entirely upon any future appreciation. There is no guarantee that our ordinary shares
will appreciate in value or even maintain the price at which our shareholders purchased their shares.
 
 If securities or industry analysts do not
publish research or publish inaccurate or unfavorable research about our business, our share price and trading volume could decline. 
 
 The trading market for our ordinary shares will
depend on the research and reports that securities or industry analysts publish about us or our business. We do not have any control
over these analysts. There can be no assurance that analysts will cover us or provide favorable coverage. If one or more of the analysts
who cover us downgrade our stock or change their opinion of our stock, our share price would likely decline. If one or more of these
analysts cease coverage of the Company or fail to regularly publish reports on the Company, we could lose visibility in the financial
markets, which could cause our share price or trading volume to decline.
 
 ITEM 1B. UNRESOLVED STAFF COMMENTS 
 
 Not applicable.
Triller Group Inc. 10-K

Item 1A. Risk Factors
