11 unchanged sentences
We may not be able to scale our business quickly enough to meet customer and market demand, which could result in lower profitability or cause us to fail to execute on our business strategies.
+Added: We may not manage our growth effectively.
+Added: Our management has limited experience in operating a public company.
Our estimates of market opportunity and forecasts of market growth may prove to be inaccurate.
Even if the market in which we compete achieves the forecasted growth, our business could fail to grow at similar rates, if at all.
−Removed: Our management has limited experience in operating a public company.
−Removed: We have identified a material weakness in our internal control over financial reporting.
−Removed: If we are unable to remediate this material weakness, or if we identify additional material weaknesses in the future or otherwise fail to maintain an effective system of internal control over financial reporting, this may result in material misstatements of our financial statements or cause us to fail to meet our periodic reporting obligations or cause our access to the capital markets to be impaired.
+Added: Our operating and financial results forecast relies in large part upon assumptions and analyses we developed.
+Added: If these assumptions or analyses prove to be incorrect, our actual operating results may be materially different from our forecasted results.
We may need additional capital to pursue our business objectives and respond to business opportunities, challenges or unforeseen circumstances, and we cannot be sure that additional financing will be available.
We have not produced a scalable quantum computer and face significant barriers in our attempts to produce quantum computers.
−Removed: If we cannot successfully overcome those barriers, our business will be negatively impacted and could fail.
−Removed: Our 32-qubit system, which is an important milestone for our technical roadmap and commercialization, is not yet available for customers and may never be available.
The quantum computing industry is competitive on a global scale and we may not be successful in competing in this industry or establishing and maintaining confidence in our long-term business prospects among current and future partners and customers.
−Removed: Our business is currently dependent upon our relationship with our cloud providers.
−Removed: There are no assurances that we will be able to commercialize quantum computers from our relationships with cloud providers.
−Removed: Even if we are successful in developing quantum computing systems and executing our strategy, competitors in the industry may achieve technological breakthroughs which render our quantum computing systems obsolete or inferior to other products.
+Added: Even if we are successful in developing quantum computing systems and executing our strategy, competitors in the industry may achieve technological breakthroughs that render our quantum computing systems obsolete or inferior to other products.
We may be unable to reduce the cost per qubit, which may prevent us from pricing our quantum systems competitively.
1 unchanged sentence
If our computers fail to achieve a broad quantum advantage, our business, financial condition and future prospects may be harmed.
−Removed: We could suffer disruptions, outages, defects and other performance and quality problems with our quantum computing systems or with the public cloud and internet infrastructure on which we rely.
−Removed: We may face unknown supply chain issues that could delay the introduction of our product and negatively impact our business and operating results.
−Removed: If we cannot successfully execute on our strategy, including in response to changing customer needs and new technologies and other market requirements, or achieve our objectives in a timely manner, our business, financial condition and results of operations could be harmed.
+Added: We could suffer disruptions, outages, defects and other performance and quality problems with our quantum computing systems or with the public cloud and internet infrastructure on which they rely.
+Added: We have and may continue to face supply chain issues that could delay the introduction of our product and negatively impact our business and operating results.
+Added: If we cannot successfully execute on our strategy or achieve our objectives in a timely manner, our business, financial condition and results of operations could be harmed.
Our products may not achieve market success, but will still require significant costs to develop.
−Removed: We are highly dependent on our co-founders, and our ability to attract and retain senior management and other key employees, such as quantum physicists and other key technical employees, is critical to our success.
−Removed: If we fail to retain talented, highly-qualified senior management, engineers and other key employees or attract them when needed, such failure could negatively impact our business.
−Removed: Our future growth and success depend on our ability to sell effectively to large customers.
+Added: We are highly dependent on our co-founders, and our ability to attract and retain senior management and other key employees is critical to our success.
We may not be able to accurately estimate the future supply and demand for our quantum computers, which could result in a variety of inefficiencies in our business and hinder our ability to generate revenue.
−Removed: If we fail to accurately predict our manufacturing requirements, we could incur additional costs or experience delays.
Our systems depend on the use of a particular isotope of an atomic element that provides qubits for our ion trap technology.
1 unchanged sentence
If our quantum computing systems are not compatible with some or all industry-standard software and hardware in the future, our business could be harmed.
−Removed: If we are unable to maintain our current strategic partnerships or we are unable to develop future collaborate partnerships, our future growth and development could be negatively impacted.
−Removed: Our business depends on our customer’s abilities to find useful quantum algorithms and sufficient quantum resources for their business.
−Removed: If they are unable to do so due to the nature of their algorithmic challenge or other technical or personnel dilemmas, our growth may be negatively impacted.
−Removed: System security and data protection breaches, as well as cyber-attacks, could disrupt our operations, which may damage our reputation and adversely affect our business.
+Added: If we are unable to maintain our current strategic partnerships or we are unable to develop future collaborative partnerships, our future growth and development could be negatively impacted.
+Added: Our business depends on our customers’ abilities to implement useful quantum algorithms and sufficient quantum resources for their business.
+Added: Our future growth and success depend in part on our ability to sell effectively to government entities and large enterprises.
+Added: Contracts with government and state agencies are subject to a number of challenges and risks.
+Added: Our future growth and success depend on our ability to sell effectively to large customers.
+Added: Contracts with government and state agencies are subject to a number of challenges and risks.
+Added: If our information technology systems, data, or physical facilities where our quantum computers are stored, or those of third parties upon which we rely, are or were compromised, we could experience adverse business consequences resulting from such compromise.
Unfavorable conditions in our industry or the global economy, could limit our ability to grow our business and negatively affect our results of operations.
Government actions and regulations, such as tariffs and trade protection measures, may limit our ability to obtain products from our suppliers.
−Removed: Our operating and financial results forecast relies in large part upon assumptions and analyses we developed.
−Removed: If these assumptions or analyses prove to be incorrect, our actual operating results may be materially different from our forecasted results.
−Removed: We have been, and may in the future be, adversely affected by the global COVID-19 pandemic, its various strains or future pandemics.
−Removed: We are subject to requirements relating to environmental and safety regulations and environmental remediation matters which could adversely affect our business, results of operation and reputation.
+Added: Because our success depends, in part, on our ability to expand sales internationally, our business will be susceptible to risks associated with international operations.
Licensing of intellectual property is of critical importance to our business.
−Removed: For example, we license patents (some of which are foundational patents) and other intellectual property from the University of
−Removed: Maryland and Duke University on an exclusive basis.
−Removed: If the license agreement with these universities terminates, or if any of the other agreements under which we acquired or licensed, or will acquire or license, material intellectual property rights is terminated, we could lose the ability to develop and operate our business.
If we are unable to obtain and maintain patent protection for our products and technology, or if the scope of the patent protection obtained is not sufficiently broad or robust, our competitors could develop and commercialize products and technology similar or identical to ours, and our ability to successfully commercialize our products and technology may be adversely affected.
Moreover, our trade secrets could be compromised, which could cause us to lose the competitive advantage resulting from these trade secrets.
−Removed: We may face patent infringement and other intellectual property claims that could be costly to defend, result in injunctions and significant damage awards or other costs (including indemnification of third parties or costly licensing arrangements (if licenses are available at all)) and limit our ability to use certain key technologies in the future or require development of non-infringing products, services, or technologies, which could result in a significant expenditure and otherwise harm our business.
+Added: We may face patent infringement and other intellectual property claims that could be costly to defend, result in injunctions and significant damage awards or other costs and limit our ability to use certain key technologies in the future or require development of non-infringing products, services, or technologies.
Some of our in-licensed intellectual property, including the intellectual property licensed from the University of Maryland and Duke University, has been conceived or developed through government-funded research and thus may be subject to federal regulations providing for certain rights for the U.S.
−Removed: government or imposing certain obligations on us, such as a license to the U.S.
−Removed: government under such intellectual property, “march-in” rights, certain reporting requirements and a preference for U.S.-based companies, and compliance with such regulations may limit our exclusive rights and our ability to contract with non-U.S.
+Added: government or imposing certain obligations on us and compliance with such regulations may limit our exclusive rights and our ability to contract with non-U.S.
manufacturers.
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We are an early stage company and have a limited operating history, which makes it difficult to forecast our future results of operations.
−Removed: We were founded in 2015 and first offered our Quantum Computer as a Service (“QCaaS”) and professional services related to training on our quantum computing systems in 2020 and 2019, respectively.
As a result of our limited operating history, our ability to accurately forecast our future results of operations is limited and subject to a number of uncertainties, including our ability to plan for and model future growth.
Our ability to generate revenues will largely be dependent on our ability to develop and produce quantum computers with increasing numbers of algorithmic qubits.
−Removed: We have commercialized a quantum computer with 20 algorithmic qubits.
−Removed: As a result, our scalable business model has not been formed and our technical roadmap may not be realized as quickly as hoped, or even at all.
−Removed: The development of our scalable business model will likely require the incurrence of a substantially higher level of costs than incurred to date, while our revenues will not substantially increase until more powerful, scalable computers are produced, which requires a number of technological advancements which may not occur on the currently anticipated timetable or at all.
+Added: As a result, our scalable business model has not been formed and our technical roadmap may not be realized as quickly as expected, or even at all.
+Added: The development of our scalable business model will likely require the incurrence of a substantially higher level of costs than incurred to date, while our revenues will not substantially increase until more powerful, scalable computers are produced, that requires a number of technological advancements which may not occur on the currently anticipated
+Added: timetable or at all.
As a result, our historical results should not be considered indicative of our future performance.
−Removed: Further, in future periods, our growth could slow or decline for a number of reasons, including but not limited to slowing demand for our QCaaS, increased competition, changes to technology, inability to scale up our technology, a decrease in the growth of the overall market, or our failure, for any reason, to continue to take advantage of growth opportunities.
+Added: Further, in future periods, our growth could slow or decline for a number of reasons, including but not limited to slowing demand for our service offerings, increased competition, changes to technology, inability to scale up our technology, a decrease in the growth of the overall market, or our failure, for any reason, to continue to take advantage of growth opportunities.
We have also encountered, and will continue to encounter, risks and uncertainties frequently experienced by growing companies in rapidly changing industries.
1 unchanged sentence
Our success as a business ultimately relies upon fundamental research and development breakthroughs in the coming years and decade.
−Removed: There is no certainty these research and development milestones will be achieved as quickly as hoped, or even at all.
+Added: There is no certainty these research and development milestones will be achieved as quickly as expected, or even at all.
We have a history of operating losses and expect to incur significant expenses and continuing losses for the foreseeable future.
−Removed: We incurred net losses of $106.2 million and $15.4 million for the years ended December 31, 2021 and December 31, 2020, respectively.
+Added: We have historically experienced net losses from operations.
+Added: For the year ended December 31, 2022, we incurred a loss from operations of $48.5 million.
As of December 31, 2022, we had an accumulated deficit of $194.3 million.
−Removed: We believe that we will continue to incur operating and net losses each quarter until at least the time we begin significant production of our quantum computers, which is not expected to occur until 2025, at the earliest, and may occur later, or never.
+Added: We believe that we will continue to incur losses each year until at least the time we begin significant production and delivery of our quantum computers, which is not expected to occur until 2025, at the earliest, and may occur later, or never.
Even with significant production, such production may never become profitable.
−Removed: We expect the rate at which we will incur losses to be significantly higher in future periods as we, among other things, continue to incur significant expenses in connection with the design, development and manufacturing of our quantum computers, and as we expand our research and development activities, invest in manufacturing capabilities, build up inventories of components for our quantum computers, increase our sales and marketing activities, develop our distribution infrastructure, and increase our general and administrative functions to support our growing operations and being a public company.
+Added: We expect the rate at which we will incur operating losses to be significantly higher in future periods as we, among other things, continue to incur significant expenses in connection with the design, development and construction of our quantum computers, and as we expand our research and development activities, invest in manufacturing capabilities, build up inventories of components for our quantum computers, increase our sales and marketing activities, develop our distribution infrastructure, and increase our general and administrative functions to support our growing operations and costs of being a public company.
We may find that these efforts are more expensive than we currently anticipate or that these efforts may not result in revenues, which would further increase our losses.
30 unchanged sentences
If we cannot evolve and scale our business and operations effectively, we may not be able to execute our business strategies in a cost-effective manner and our business, financial condition, profitability and results of operations could be adversely affected.
+Added: We may not manage growth effectively.
+Added: If we fail to manage growth effectively, our business, results of operations and financial condition could be harmed.
+Added: We anticipate that a period of significant expansion will be required to address potential growth.
+Added: This expansion will place a significant strain on our management, operational and financial resources.
+Added: Expansion will require significant cash investments and management resources and there is no guarantee that they will generate additional sales of our products or services, or that we will be able to avoid cost overruns or be able to hire additional personnel to support them.
+Added: In addition, we will also need to ensure our compliance with regulatory requirements in various jurisdictions applicable to the sale, installation and servicing of our products.
+Added: To manage the growth of our operations and personnel, we must establish appropriate and scalable operational and financial systems, procedures and controls and establish and maintain a qualified finance, administrative and operations staff.
+Added: We may be unable to acquire the necessary capabilities and personnel required to manage growth or to identify, manage and exploit potential strategic relationships and market opportunities.
+Added: Our management has limited experience in operating a public company.
+Added: Our executive officers have limited experience in the management of a publicly traded company.
+Added: Our management team may not successfully or effectively manage reporting obligations under federal securities laws.
+Added: Their limited experience in dealing with the increasingly complex laws pertaining to public companies could be a
+Added: significant disadvantage in that it is likely that an increasing amount of their time may be devoted to these activities, which will result in less time being devoted to our management and growth.
+Added: The development and implementation of the standards and controls necessary for us to achieve the level of accounting standards required of a public company in the United States may require costs greater than expected.
+Added: It is possible that we will be required to expand our employee base and hire additional employees to support our operations as a public company, which will increase our operating costs in future periods.
Our estimates of market opportunity and forecasts of market growth may prove to be inaccurate.
3 unchanged sentences
Any expansion in our market depends on a number of factors, including the cost, performance, and perceived value associated with quantum computing solutions.
−Removed: The methodology and assumptions used to estimate market opportunities may differ materially from the methodologies and assumptions previously used to estimate total addressable market.
+Added: The methodology and assumptions used to estimate market opportunities may differ materially from the methodologies and assumptions previously used to estimate the total addressable market.
To estimate the size of our market opportunities and our growth rates, we have relied on market reports by leading research and consulting firms.
−Removed: These estimates of total addressable market and growth forecasts are subject to significant uncertainty, are based on assumptions and estimates that may not prove to be accurate and are based on data published by third parties that we have not independently verified.
+Added: These estimates of the total addressable market and growth forecasts are subject to significant uncertainty, are based on assumptions and estimates that may not prove to be accurate and are based on data published by third parties that we have not independently verified.
Advances in classical computing may prove more robust for longer than currently anticipated.
3 unchanged sentences
Even if the market in which we compete meets the size estimates and growth forecasted, our business could fail to grow at similar rates, if at all.
−Removed: Our growth is dependent upon our ability to successfully scale up manufacturing of our products in sufficient quantity and quality, in a timely or cost-effective manner, or at all.
+Added: Our growth is dependent upon our ability to successfully scale up manufacturing of our products in sufficient quantity and quality, in a timely or cost-effective manner.
Our growth is also dependent upon our ability to successfully market and sell quantum computing technology.
2 unchanged sentences
Unforeseen issues associated with scaling up and constructing quantum computing technology at commercially viable levels, and selling our technology, could negatively impact our business, financial condition and results of operations.
−Removed: Moreover, because of our unique technology, our customers will require particular support and service functions, some of which are not currently available, and may never be available.
−Removed: If we experience delays in adding such support capacity or servicing our customers efficiently, or experiences unforeseen issues with the reliability of our technology, it could overburden our servicing and support capabilities.
−Removed: Similarly, increasing the number of our products and services would require us to rapidly increase the availability of these services.
+Added: Moreover, because of our unique technology, our customers will require particular support and service functions, some of which are not currently available.
+Added: If we experience delays in adding such support capacity or servicing our customers efficiently, or experience unforeseen issues with the reliability of our technology, it could overburden our servicing and support capabilities.
+Added: Similarly, increasing the number of our customers, products or services, for example by entering into government contracts and expanding to new geographies, has required and may continue to require us to rapidly increase the availability of these services.
Failure to adequately support and service our customers may inhibit our growth and ability to expand computing targets globally.
−Removed: There can be no assurance that our projections on which such targets are based will prove accurate or that the pace of growth or coverage of our customer infrastructure network will meet customer expectations.
+Added: There can be no assurance that our projections on which such targets are based will prove accurate or
+Added: that the pace of growth or coverage of our customer infrastructure network will meet customer expectations.
Failure to grow at rates similar to that of the quantum computing industry may adversely affect our operating results and ability to effectively compete within the industry.
−Removed: We may not manage growth effectively.
−Removed: If we fail to manage growth effectively, our business, results of operations and financial condition could be harmed.
−Removed: We anticipate that a period of significant expansion will be required to address potential growth.
−Removed: This expansion will place a significant strain on our management, operational and financial resources.
−Removed: Expansion will require significant cash investments and management resources and there is no guarantee that they will generate additional sales of our products or services, or that we will be able to avoid cost overruns or be able to hire additional personnel to support them.
−Removed: In addition, we will also need to ensure our compliance with regulatory requirements in various jurisdictions applicable to the sale, installation and servicing of our products.
−Removed: To manage the growth of our operations and personnel, we must establish appropriate and scalable operational and financial systems, procedures and controls and establish and maintain a qualified finance, administrative and operations staff.
−Removed: We may be unable to acquire the necessary capabilities and personnel required to manage growth or to identify, manage and exploit potential strategic relationships and market opportunities.
−Removed: Our management has limited experience in operating a public company.
−Removed: Our executive officers have limited experience in the management of a publicly traded company.
−Removed: Our management team may not successfully or effectively manage our transition to a public company that is subject to significant regulatory oversight and reporting obligations under federal securities laws.
−Removed: Their limited experience in dealing with the increasingly complex laws pertaining to public companies could be a significant disadvantage in that it is likely that an increasing amount of their time may be devoted to these activities, which will result in less time being devoted to our management and growth.
−Removed: We may not have adequate personnel with the appropriate level of knowledge, experience, and training in the accounting policies, practices or internal controls over financial reporting required of public companies in the United States.
−Removed: The development and implementation of the standards and controls necessary for us to achieve the level of accounting standards required of a public company in the United States may require costs greater than expected.
−Removed: It is possible that we will be required to expand our employee base and hire additional employees to support our operations as a public company, which will increase our operating costs in future periods.
−Removed: We have identified a material weakness in our internal control over financial reporting.
−Removed: If we are unable to remediate this material weakness, or if we identify additional material weaknesses in the future or otherwise fail to maintain an effective system of internal control over financial reporting, this may result in material misstatements of our financial statements or cause us to fail to meet our periodic reporting obligations or cause our access to the capital markets to be impaired.
−Removed: In connection with the preparation of our financial statements as of and for the year ended December 31, 2021, we identified a material weakness in our internal control over financial reporting specifically related to our financial statement close process.
−Removed: Specifically,
−Removed: Although we recently added accounting and financial reporting personnel with requisite knowledge and experience in the application of U.S.
−Removed: GAAP and SEC rules, the Company is still in process of
−Removed: formalizing its processes and procedures, establishing clear authorities and approvals and segregating duties to facilitate accurate and timely financial reporting.
−Removed: Our financial accounting system has limited functionality and does not facilitate effective information technology general controls relevant to financial reporting.
−Removed: Additionally, elements of our close process are managed and processed outside the accounting system, increasing the risk of error.
−Removed: This material weakness could result in a misstatement of account balances or disclosures that would result in a material misstatement to the annual or interim consolidated financial statements that would not be prevented or detected.
−Removed: In light of the material weakness identified, we are implementing a remediation plan which includes measures designed to improve our internal control over financial reporting to remediate this material weakness.
−Removed: These measures include adding resources (both internal and external) as well as improving the control environment around financial systems and processes.
−Removed: In 2021, the Company completed the following remedial actions:
−Removed: Hired additional full-time accounting personnel with appropriate levels of experience, and augmented skills gaps with external experts;
−Removed: Established and implemented policies surrounding the approval of transactions, related to, but not limited to, account reconciliations and journal entries;
−Removed: Selected and began implementing a financial accounting system that can support effective information technology general controls as well as the anticipated growth of the business.
−Removed: Our management believes that these actions, and additional actions to be taken under our remediation plan, are sufficient to remediate the material weakness identified and strengthen our internal control over financial reporting.
−Removed: The actions we are taking are subject to ongoing senior management review, as well as Audit Committee oversight.
−Removed: The material weakness will not be considered remediated until our remediation plan has been fully implemented, the applicable controls operate for a sufficient period of time, and we have concluded, through testing, that the newly implemented and enhanced controls are operating effectively.
−Removed: At this time, we cannot predict the success of such efforts or the outcome of our assessment of the remediation efforts.
−Removed: We can give no assurance that our efforts will remediate this material weakness in our internal control over financial reporting, or that additional material weaknesses will not be identified in the future.
−Removed: Our failure to implement and maintain effective internal control over financial reporting could result in errors in our consolidated financial statements that could result in a restatement of our financial statements, and could cause us to fail to meet our reporting obligations, any of which could diminish investor confidence in us and cause a decline in the price of our common stock.
−Removed: We are required to disclose changes made in our internal controls and procedures on a quarterly basis and our management is required to assess the effectiveness of controls annually.
−Removed: Our independent registered public accounting firm is not required to formally attest to the effectiveness of our internal control over financial reporting until after we are no longer an “emerging growth company,” as defined in the JOBS Act.
−Removed: At such time, our independent registered public accounting firm may issue a report that is adverse in the event it is not satisfied with the level at which our internal control over financial reporting is documented, designed or operating.
+Added: Our operating and financial results forecast relies in large part upon assumptions and analyses we have developed.
+Added: If these assumptions or analyses prove to be incorrect, our actual operating results may be materially different from our forecasted results.
+Added: Our projected financial and operating information reflect current estimates of future performance, which may never occur.
+Added: Whether actual operating and financial results and business developments will be consistent with our expectations and assumptions as reflected in our forecasts depends on a number of factors, many of which are outside our control, including, but not limited to:
+Added: success and timing of development activity;
+Added: customer acceptance of our quantum computing systems;
+Added: breakthroughs in classical computing or other computing technologies that could eliminate the advantages of quantum computing systems rendering them less practical to customers;
+Added: competition, including from established and future competitors;
+Added: whether we can obtain sufficient capital to sustain and grow our business;
+Added: our ability to manage our growth;
+Added: our ability to retain existing key management, integrate recent hires and attract, retain and motivate qualified personnel;
+Added: the overall strength and stability of domestic and international economies.
+Added: Unfavorable changes in any of these or other factors, most of which are beyond our control, could materially and adversely affect our business, financial condition and results of operations.
We may need additional capital to pursue our business objectives and respond to business opportunities, challenges or unforeseen circumstances, and we cannot be sure that additional financing will be available.
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In addition, we may seek additional capital due to favorable market conditions or strategic considerations even if we believe that we have sufficient funds for current or future operating plans.
+Added: Weakness and volatility in capital markets and the economy, in general or as a result of bank failures or macroeconomic conditions such as rising inflation and interest rates, could limit our access to capital markets and increase our costs of borrowing.
There can be no assurance that financing will be available to us on favorable terms, or at all.
2 unchanged sentences
We have incurred losses during our history, do not expect to become profitable in the near future and may never achieve profitability.
−Removed: To the extent that we continue to generate taxable losses, unused losses will carry forward to offset future taxable income, if any, until such unused losses expire, if at all.
+Added: To the extent that we continue to generate taxable losses, unused losses will carry
+Added: forward to offset future taxable income, if any, until such unused losses expire, if at all.
As of December 31, 2022, we had U.S.
−Removed: federal and state net operating loss carryforwards of approximately $14.1 million.
+Added: federal and state net operating loss carryforwards of approximately $96.3 million and $69.5 million, respectively.
Our net operating loss carryforwards are subject to review and possible adjustment by the IRS, and state tax authorities.
1 unchanged sentence
An “ownership change” pursuant to Section 382 of the Code generally occurs if one or more stockholders or groups of stockholders who own at least 5% of a company’s stock increase their ownership by more than 50 percentage points over their lowest ownership percentage within a rolling three-year period.
−Removed: Our ability to utilize our net operating loss carryforwards and other tax attributes to offset future taxable income or tax liabilities may be limited as a result of ownership changes, including changes in connection with our business combination with dMY Technology Group, Inc.
−Removed: III (“dMY”) or other transactions.
+Added: Our ability to utilize our net operating loss carryforwards and other tax attributes to offset future taxable income or tax liabilities may be limited as a result of ownership changes, including changes in connection with our Business Combination with dMY or other transactions.
Similar rules may apply under state tax laws.
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the photonic interconnect between ion traps could prove more challenging and take longer to perfect than currently expected.
−Removed: This would limit our ability to scale beyond a single ion trap of approximately 22 logical qubits;
+Added: This would limit our ability to scale to a sufficiently large number of algorithmic qubits in a single system;
it could take longer to tune the qubits in a single ion trap, as well as preserve the stability of the qubits within a trap as we seek to maximize the total number of qubits within one trap;
the gate speed in our technology could prove more difficult to improve than expected;
−Removed: the scaling of fidelity with qubit number could prove poorer than expected, limiting our ability to achieve larger quantum volume.
+Added: the scaling of fidelity with qubit number could prove poorer than expected, limiting our ability to achieve larger algorithmic qubits.
In addition, we will need to develop the manufacturing process necessary to make these quantum computers in high volume.
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Even if we complete development and achieve volume production of our quantum computers, if the cost, performance characteristics or other specifications of the quantum computer fall short of our projections, our business, financial condition and results of operations would be adversely affected.
−Removed: Our 32-qubit system, which is an important milestone for our technical roadmap and commercialization, is not yet available for customers and may never be available.
−Removed: We are developing our next-generation 32-qubit quantum computer system, which has not yet been made available to customers.
−Removed: We expect this system to have 22 algorithmic qubits, i.e., qubits that are usable to run quantum algorithms, but the number of algorithmic qubits available in this system has not been finalized and may be fewer than planned.
−Removed: The availability of this generation of quantum computer system for customer use or independent verification by a third party may be materially delayed, or even never occur.
−Removed: Additionally, the future success of our technical roadmap will depend upon our ability to approximately double the number of qubits in each subsequent generation of our quantum computer.
−Removed: Accordingly, our technical roadmap may be delayed or may never be achieved, either of which would have a material impact on our business, financial condition or results of operations.
The quantum computing industry is competitive on a global scale and we may not be successful in competing in this industry or establishing and maintaining confidence in our long-term business prospects among current and future partners and customers.
2 unchanged sentences
Our current competitors include:
−Removed: large, well-established tech companies that generally compete in all of our markets, including Honeywell, Google, Microsoft, Amazon, Intel and IBM;
+Added: large, well-established tech companies that generally compete in all of our markets, including Google, Microsoft, Amazon, Intel and IBM;
countries such as China, Russia, Canada, Australia and the United Kingdom, and those in the European Union and we believe additional countries in the future;
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For all of these reasons, competition may negatively impact our ability to maintain and grow consumption of our platform or put downward pressure on our prices and gross margins, any of which could materially harm our reputation, business, results of operations, and financial condition.
−Removed: Our business is currently dependent upon our relationship with our cloud providers.
+Added: An element of our business is currently dependent upon our relationship with our cloud providers.
There are no assurances that we will be able to commercialize quantum computers from our relationships with cloud providers.
−Removed: Cloud computing partnerships could be terminated, or not scale as anticipated, or even at all.
−Removed: We currently offer our QCaaS on public clouds provided by Amazon Web Services’ (“AWS”), Microsoft’s Azure Quantum (“Azure”), and the Google Cloud Marketplace.
+Added: We currently offer our QCaaS on public clouds provided by AWS’s Amazon Braket, Microsoft’s Azure Quantum, and the Google Cloud Marketplace.
The companies that own these public clouds have internal quantum computing efforts that are competitive to our technology.
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All of the foregoing could make it difficult or impossible for us to provide products and services that compete favorably with those of the public cloud providers.
−Removed: Further, if our contractual and other business relationships with our public cloud providers are terminated, either by the counterparty or by us, suspended or suffer a material change to which we are unable to adapt, such as the elimination of services or features on which we depend, we would be unable to provide our QCaaS at the same scale and would experience significant delays and incur additional expense in transitioning customers to a different public cloud provider.
−Removed: Any material change in our contractual and other business relationships with our public cloud providers could result in reduced use of our systems, increased expenses, including service credit obligations, and harm to our brand and reputation, any of which could have a material adverse effect on our business, financial condition and results of operations.
−Removed: Even if we are successful in developing quantum computing systems and executing our strategy, competitors in the industry may achieve technological breakthroughs which render our quantum computing systems obsolete or inferior to other products.
+Added: Any material change in our contractual and other business relationships with our public cloud providers could result in harm to our brand and reputation and reduced use of our systems, which could have a material adverse effect on our business, financial condition and results of operations.
+Added: Even if we are successful in developing quantum computing systems and executing our strategy, competitors in the industry may achieve technological breakthroughs that render our quantum computing systems obsolete or inferior to other products.
Our continued growth and success depend on our ability to innovate and develop quantum computing technology in a timely manner and effectively market these products.
Without timely innovation and development, our quantum computing solutions could be rendered obsolete or less competitive by changing customer preferences or because of the introduction of a competitor’s newer technologies.
−Removed: We believe that many competing technologies will require a technological breakthrough in one or more problems related to science, fundamental physics or manufacturing.
+Added: We believe that many
+Added: competing technologies will require a technological breakthrough in one or more problems related to science, fundamental physics or manufacturing.
While it is uncertain whether such technological breakthroughs will occur in the next several years, that does not preclude the possibility that such technological breakthroughs could eventually occur.
−Removed: Any technological breakthroughs which render our technology obsolete or inferior to other products could have a material effect on our business, financial condition or results of operations.
+Added: Any technological breakthroughs that render our technology obsolete or inferior to other products could have a material effect on our business, financial condition or results of operations.
We may be unable to reduce the cost per qubit, which may prevent us from pricing our quantum systems competitively.
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If our computers fail to achieve a broad quantum advantage, our business, financial condition and future prospects may be harmed.
−Removed: Quantum advantage refers to the moment when a quantum computer can compute faster than traditional computers, while quantum supremacy is achieved once quantum computers are powerful enough to complete
−Removed: calculations that traditional supercomputers cannot perform at all.
+Added: Quantum advantage refers to the moment when a quantum computer can compute faster than traditional computers, while quantum supremacy is achieved once quantum computers are powerful enough to complete calculations that traditional supercomputers cannot perform at all.
Broad quantum advantage is when quantum advantage is seen in many applications and developers prefer quantum computers to a traditional computer.
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Any disruptions, outages, defects and other performance and quality problems with our quantum computing system or with the public cloud and internet infrastructure on which it relies, could result in reduced use of our systems, increased expenses, including service credit obligations, and harm to our brand and reputation, any of which could have a material adverse effect on our business, financial condition and results of operations.
−Removed: We may face unknown supply chain issues that could delay the introduction of our product and negatively impact our business and operating results.
+Added: We have and may continue to face supply chain issues that could delay the introduction of our product and negatively impact our business and operating results.
We are reliant on third-party suppliers for components necessary to develop and manufacture our quantum computing solutions.
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a significant increase in the price of one or more components, including due to industry consolidation occurring within one or more component supplier markets or as a result of decreased production capacity at manufacturers;
−Removed: any reductions or interruption in supply, including disruptions on our global supply chain as a result of the COVID-19 pandemic, which we have experienced, and may in the future experience;
−Removed: any supply chain disruptions due to Russia’s recent incursion in the Ukraine and any indirect effects thereof which could further complicate existing supply chain constraints;
+Added: any reductions or interruption in supply, including disruptions on our global supply chain as a result of the global chip shortage, or the Russia-Ukraine war and any indirect effects thereof;
financial problems of either manufacturers or component suppliers;
significantly increased freight charges, or raw material costs and other expenses associated with our business;
−Removed: other factors beyond our control or which we do not presently anticipate, could also affect our suppliers’ ability to deliver components to us on a timely basis;
+Added: other factors beyond our control or that we do not presently anticipate, could also affect our suppliers’ ability to deliver components to us on a timely basis;
a failure to develop our supply chain management capabilities and recruit and retain qualified professionals;
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a failure to appropriately cancel, reschedule, or adjust our requirements based on our business needs.
−Removed: If any of the aforementioned factors were to materialize, it could cause us to halt production of our quantum computing solutions and/or entail higher manufacturing costs, any of which could materially adversely affect our business, operating results, and financial condition and could materially damage customer relationships.
+Added: We have experienced supply chain issues in the past as a result of COVID-19.
+Added: If any of the aforementioned factors were to materialize, it could cause us to delay or halt production of our quantum computing solutions and/or entail higher manufacturing costs, any of which could materially adversely affect our business, operating results, and financial condition and could materially damage customer relationships.
If we cannot successfully execute on our strategy, including in response to changing customer needs and new technologies and other market requirements, or achieve our objectives in a timely manner, our business, financial condition and results of operations could be harmed.
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failures to accurately predict market or customer demands;
−Removed: defects, errors or failures in the design or performance of our quantum computing system;
−Removed: negative publicity about the performance or effectiveness of our system;
+Added: defects, errors or failures in the design or performance of our quantum computing systems;
+Added: negative publicity about the performance or effectiveness of our systems;
strategic reaction of companies that market competitive products;
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These individuals could leave our employment at any time, as they are “at will” employees.
−Removed: A loss of the co-founders, a member of senior management, or an engineer or other key employee particularly to a competitor, could also place us at a competitive disadvantage.
+Added: A loss of one of our co-founders, a member of senior management, or an engineer or other key employee particularly to a competitor, could also place us at a competitive disadvantage.
Effective succession planning is also important to our long-term success.
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The market for highly skilled workers and leaders in the quantum computing industry is extremely competitive.
−Removed: In particular, hiring qualified personnel specializing in supply chain management, engineering and sales, as well as other technical staff and research and development personnel is critical to our business and the development of our quantum computing systems.
+Added: In particular, hiring qualified personnel specializing in engineering, software development and sales, as well as other technical staff and research and development personnel is critical to our business and the development of our quantum computing systems.
Some of these professionals are hard to find and we may encounter significant competition in our efforts to hire them.
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If we cannot attract, train and retain qualified personnel, including our co-founders, in this competitive environment, we may experience delays in the development of our quantum computing technologies and be otherwise unable to develop and grow our business as projected, or even at all.
−Removed: Our future growth and success depend on our ability to sell effectively to large customers.
−Removed: Our potential customers tend to be large enterprises.
−Removed: Therefore, our future success will depend on our ability to effectively sell our products to such large customers.
−Removed: Sales to these end-customers involve risks that may not be present (or that are present to a lesser extent) with sales to smaller customers.
−Removed: These risks include, but are not limited to, (i) increased purchasing power and leverage held by large customers in negotiating contractual arrangements with us and (ii) longer sales cycles and the associated risk that substantial time and resources may be spent on a potential end-customer that elects not to purchase our solutions.
−Removed: Large organizations often undertake a significant evaluation process that results in a lengthy sales cycle.
−Removed: In addition, product purchases by large organizations are frequently subject to budget constraints, multiple approvals and unanticipated administrative, processing and other delays.
−Removed: Finally, large organizations typically have longer implementation cycles, require greater product functionality and scalability, require a broader range of services, demand that vendors take on a larger share of risks, require acceptance provisions that can lead to a delay in revenue recognition and expect greater payment flexibility.
−Removed: All of these factors can add further risk to business conducted with these potential customers.
We may not be able to accurately estimate the future supply and demand for our quantum computers, which could result in a variety of inefficiencies in our business and hinder our ability to generate revenue.
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We anticipate being required to provide forecasts of our demand to our current and future suppliers prior to the scheduled delivery of products to potential customers.
−Removed: Currently, there is no historical basis for making judgments on the demand for our quantum computers or our ability to develop, manufacture, and deliver quantum computers, or our profitability, if any, in the future.
+Added: Currently, there is very little historical basis for making judgments on the demand for our quantum computers or our ability to develop, manufacture, and deliver quantum computers, or our profitability, if any, in the future.
If we overestimate our requirements, our suppliers may have excess inventory, which indirectly would increase our costs.
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If we are unable to procure these isotopically enriched atomic samples, or are unable to do so on a timely and cost-effective basis, and in sufficient quantities, we may incur significant costs or delays, which could negatively affect our operations and business.
−Removed: There are limited suppliers to sources of isotopically enriched materials which may be necessary for the production of our ion trap technology.
+Added: There are limited suppliers to sources of isotopically enriched materials that may be necessary for the production of our ion trap technology.
We currently purchase such materials through the National Isotope Development Center managed by the U.S.
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We have focused our efforts on creating quantum computing hardware, the operating system for such hardware and a suite of low-level software programs that optimize execution of quantum algorithms on our hardware.
−Removed: Further up the software stack, we rely on third parties to create higher level quantum programming languages, software development kits (SDKs), and application libraries.
+Added: Further up the software stack, we rely on third parties to create higher level quantum programming languages, SDKs, and application libraries.
Such third-party software and programming is essential to operating our quantum computing products and services.
−Removed: Our quantum computing solutions are designed today to be compatible with most major quantum software development kits, including Qiskit, Cirq, Q# QDK, and OpenQASM, all of which are open source.
+Added: Our quantum computing solutions are designed today to be compatible with most major quantum SDKs, including Qiskit, Cirq, Q# QDK, and OpenQASM, all of which are open source.
If a proprietary (not open source) software toolset became the standard for quantum application development in the future by a competitor, usage of our hardware might be limited as a result, which would have a negative impact on us.
3 unchanged sentences
Any adverse impacts from the incompatibility of our quantum computing solutions could adversely affect our business, operating results and financial condition.
−Removed: If we are unable to maintain our current strategic partnerships or we are unable to develop future collaborate partnerships, our future growth and development could be negatively impacted.
+Added: If we are unable to maintain our current strategic partnerships or we are unable to develop future collaborative partnerships, our future growth and development could be negatively impacted.
We have entered into, and may enter into, strategic partnerships to develop and commercialize our current and future research and development programs with other companies to accomplish one or more of the following:
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If they are unable to do so due to the nature of their algorithmic challenge or other technical or personnel dilemmas, our growth may be negatively impacted.
−Removed: We have entered into, and may enter into, partnerships and other contractual arrangements with customers to develop, test and run quantum algorithms specific to their business.
+Added: We have entered into, and may enter into, contracts, partnerships and other arrangements with customers to develop, test and run quantum algorithms specific to their business.
The success of these contracts and partnerships is dependent on our customer’s ability to implement useful and scalable algorithms for their portfolio.
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To the extent our customers are unable to effectively develop or utilize resources to advance algorithmic-use cases, our business, operating results and financial condition may be adversely impacted.
−Removed: System security and data protection breaches, as well as cyber-attacks, could disrupt our operations, which may damage our reputation and adversely affect our business.
−Removed: Cyber-attacks, denial-of-service attacks, ransomware attacks, business email compromises, computer malware, viruses, and social engineering (including phishing) are prevalent in the technology industry and our customers’ industries.
−Removed: In addition, we may experience attacks, unavailable systems, unauthorized access or disclosure due to employee theft or misuse, denial-of-service attacks, sophisticated nation-state and nation-state supported actors, and advanced persistent threat intrusions.
−Removed: The techniques may be used to sabotage or to obtain unauthorized access to our platform, systems, networks, or physical facilities where our quantum computers are stored, and may be unable to implement adequate preventative measures or stop security breaches while they are occurring.
−Removed: law enforcement agencies have indicated to us that quantum computing technology is of particular interest to certain malicious cyber threat actors.
−Removed: Our platform is built to be accessed through third-party public cloud providers such as AWS, Azure and the Google Cloud Marketplace.
−Removed: These providers may also experience breaches and attacks to their products which may impact our systems.
−Removed: Data security breaches may also result from non- technical means, such as actions by an employee with access to our systems.
−Removed: While we and our third-party cloud providers have implemented security measures designed to protect against security breaches, these measures could fail or may be insufficient, resulting in the unauthorized disclosure, modification, misuse, destruction, or loss of sensitive or confidential information.
−Removed: Actual or perceived breaches of our security measures or the accidental loss, inadvertent disclosure or unapproved dissemination of proprietary information or sensitive or confidential data about us, our partners, our customers or third parties could expose the company and the parties affected to a risk of loss or misuse of this information, resulting in litigation and potential liability, paying damages, regulatory inquiries or actions, damage to the our brand and reputation or other harm to the our business.
+Added: Our future growth and success depends in part on our ability to sell effectively to government entities and large enterprises.
+Added: Our customers and potential customers include government agencies and large enterprises.
+Added: Therefore, our future success will depend on our ability to effectively sell our products to such customers.
+Added: Sales to these end-customers involve risks that may not be present (or that are present to a lesser extent) with sales to non-governmental agencies or smaller customers.
+Added: These risks include, but are not limited to, (i) increased purchasing power and leverage held by such customers in negotiating contractual arrangements with us and (ii) longer sales cycles and the associated risk that substantial time and resources may be spent on a potential end-customer that elects not to purchase our solutions.
+Added: Sales to government agencies are typically under fixed fee development contracts, which involve additional risks.
+Added: In addition, government contracts generally include the ability of government agencies to terminate early which, if exercised, would result in a lower contract value and lower than anticipated revenues generated by such arrangement.
+Added: Government agencies and large organizations often undertake a significant evaluation process that results in a lengthy sales cycle.
+Added: Our contracts with government agencies are typically structured in phases, with each phase subject to satisfaction of certain conditions.
+Added: As a result, the actual scope of work performed pursuant to any such contracts, in addition to related contract revenue, could be less than total contract value.
+Added: In addition, product purchases by such organizations are frequently subject to budget constraints, multiple approvals and unanticipated administrative, processing and other delays.
+Added: Finally, these organizations typically have longer implementation cycles, require greater product functionality and scalability, require a broader range of services, demand that vendors take on a larger share of risks, require acceptance provisions that can lead to a delay in revenue recognition and expect greater payment flexibility.
+Added: All of these factors can add further risk to business conducted with these potential customers and could lead to lower revenue results than originally anticipated.
+Added: Additionally, changes in government defense spending could have adverse consequences on our financial position, results of operations and business.
+Added: Certain current contracts and our anticipated future revenues from the U.S.
+Added: government are expected to result from contracts awarded under various U.S.
+Added: government programs.
+Added: Cost cutting, including through consolidation and elimination of duplicative organizations, has become a major initiative for certain departments within the U.S.
+Added: The funding of our programs is subject to the
+Added: government budget and appropriation decisions and processes, which are driven by numerous factors, including geo-political events and macroeconomic conditions.
+Added: The overall level of U.S.
+Added: defense spending increased in recent years for numerous reasons.
+Added: Significant reduction in defense spending could have long-term consequences for our size and structure.
+Added: In addition, reduction in government priorities and requirements could impact the funding, or the timing of funding, of our programs, which could negatively impact our results of operations and financial condition.
+Added: Contracts with government and state agencies are subject to a number of challenges and risks.
+Added: Contracts with government and state agencies are subject to a number of challenges and risks.
+Added: The bidding process for government contracts can be highly competitive, expensive and time-consuming, often requiring significant upfront time and expense without any assurance that these efforts will generate revenue.
+Added: We also must comply with laws and regulations relating to the formation, administration, and performance of contracts, which provide public sector customers rights, many of which are not typically found in commercial contracts.
+Added: For example, in 2021, the U.S.
+Added: House of Representatives introduced the Quantum Cybersecurity Preparedness Act, signaling fresh focus on the need for U.S.
+Added: investment in quantum computing—both to protect against quantum-powered attacks from foreign actors and to develop quantum computing strength on the domestic front.
+Added: In May 2022, the Biden administration announced directives to support U.S.
+Added: leadership in quantum computing, and in September 2022, the National Security Administration (NSA) shared guidance on the importance of cybersecurity readiness against would-be adversaries developing quantum systems.
+Added: Any changes to government regulations as a result of this demonstrated focus on quantum computing could affect our ability to enter into, or the profitability of, contracts with government entities.
+Added: In addition, our perceived relationship with the U.S.
+Added: government could adversely affect our business prospects in certain non-U.S.
+Added: geographies or with certain non-U.S.
+Added: Accordingly, our business, financial condition, results of operations, and growth prospects may be adversely affected by certain events or activities, including, but not limited to:
+Added: changes in government fiscal or procurement policies, or decreases in government funding available for procurement of goods and services generally, or for our federal government contracts specifically;
+Added: changes in government programs or applicable requirements;
+Added: restrictions in the grant of personnel security clearances to our employees;
+Added: ability to maintain facility clearances required to perform on classified contracts for U.S.
+Added: federal government and foreign government agencies, as applicable;
+Added: changes in the political environment, including before or after a change to the leadership within the government administration, and any resulting uncertainty or changes in policy or priorities and resultant funding;
+Added: changes in the government’s attitude towards us as a company or our technology;
+Added: appeals, disputes, or litigation relating to government procurement, including but not limited to bid protests by unsuccessful bidders on potential or actual awards of contracts to us or our partners by the government;
+Added: the adoption of new laws or regulations or changes to existing laws or regulations;
+Added: budgetary constraints, including automatic reductions as a result of “sequestration” or similar measures and constraints imposed by any lapses in appropriations for the federal government or certain of its departments and agencies;
+Added: influence by, or competition from, third parties with respect to pending, new, or existing contracts with government customers;
+Added: changes in legal obligations or political or social attitudes with respect to security or data privacy issues;
+Added: potential delays or changes in the government appropriations or procurement processes, including as a result of events such as war, incidents of terrorism, natural disasters, and public health concerns;
+Added: increased or unexpected costs or unanticipated delays caused by other factors outside of our control.
+Added: Any such event or activity, among others, could cause governments and governmental agencies to delay or refrain entering into contracts with us and/or purchasing our computers in the future, reduce the size or timing of payment with respect to our services to or purchases from existing or new government customers, or otherwise have an adverse effect on our business, results of operations, financial condition, and growth prospects.
+Added: If our information technology systems, data, or physical facilities where our quantum computers are stored, or those of third parties upon which we rely, are or were compromised, we could experience adverse business consequences resulting from such compromise.
+Added: In the ordinary course of business, we collect, receive, store, process, generate, use, transfer, disclose, make accessible, protect, secure, dispose of, transmit, and share (collectively, “Processing”) personal data and other sensitive information, including intellectual property, proprietary and confidential business data, trade secrets, sensitive third-party data, business plans, transactions, and financial information of our own, our partners, our customers, or other third parties (collectively, “Sensitive Data”).
+Added: We and the third parties upon which we rely may process Sensitive Data, and, as a result, we and the third parties upon which we rely face a variety of evolving threats to our information technology systems, data, or physical facilities where our quantum computers are stored, including but not limited to ransomware attacks, which could cause security incidents.
+Added: Cyber-attacks, malicious internet-based activity, online and offline fraud, and other similar activities threaten the confidentiality, integrity, and availability of our Sensitive Data and information technology systems, and those of the third parties upon which we rely.
+Added: Such threats are prevalent and continue to rise, are increasingly difficult to detect, and come from a variety of sources, including traditional computer “hackers,” threat actors, “hacktivists,” organized criminal threat actors, personnel (such as through theft or misuse), sophisticated nation states, and nation-state-supported actors.
+Added: law enforcement agencies have indicated to us that quantum computing technology is of particular interest to certain threat actors, including nation state and other malicious actors, who may steal our Sensitive Data, including our intellectual property or other proprietary or confidential information, including our trade secrets.
+Added: Some actors now engage and are expected to continue to engage in cyber-attacks, including without limitation nation-state and nation-state-supported actors for geopolitical reasons and in conjunction with military conflicts and defense activities.
+Added: During times of war and other major conflicts, we, the third parties upon which we rely, and our customers may be vulnerable to a heightened risk of these attacks, including retaliatory cyber-attacks, that could materially disrupt our systems and operations, supply chain, and ability to distribute our services.
+Added: We and the third parties upon which we rely may be subject to a variety of evolving threats, including but not limited to social-engineering attacks (including through phishing attacks), malicious code (such as viruses and worms), malware (including as a result of advanced persistent threat intrusions), denial-of-service attacks (such as credential stuffing), credential harvesting, personnel misconduct or error, ransomware attacks, supply-chain attacks, software bugs, server malfunctions, software or hardware failures, loss of data or other information technology assets, adware, telecommunications failures, earthquakes, fires, floods, and other similar threats.
+Added: In particular, severe ransomware attacks are becoming increasingly prevalent and could lead to significant interruptions in our operations, loss of Sensitive Data and income, reputational harm, and diversion of funds.
+Added: Extortion payments may alleviate the negative impact of a ransomware attack, but we may be unwilling or unable to make such payments due to, for example, applicable laws or regulations prohibiting such payments.
+Added: Additionally, we are incorporated into the supply chain of a large number of companies worldwide and, as a result, if our services are compromised, a significant number or, in some instances, all of our customers and their data could be simultaneously affected.
+Added: The potential liability and associated consequences we could suffer as a result of such a large-scale event could be catastrophic and result in irreparable harm.
+Added: Remote work has become more common and has increased risks to our information technology systems and data, as more of our employees utilize network connections, computers, and devices outside our premises or network, including working at home, while in transit and in public locations.
+Added: Additionally, future or past business transactions (such as acquisitions or integrations) could expose us to additional cybersecurity risks and vulnerabilities, as our systems could be negatively affected by vulnerabilities present in acquired or integrated entities’ systems and technologies.
+Added: Furthermore, we may discover security issues that were not found during due diligence of such acquired or integrated entities, and it may be difficult to integrate companies into our information technology environment and security program.
+Added: In addition, our reliance on third-party service providers could introduce new cybersecurity risks and vulnerabilities, including supply-chain attacks, and other threats to our business operations.
+Added: Our platform is built to be accessed through third-party cloud providers, such as AWS’s Amazon Braket, Microsoft’s Azure Quantum, and Google’s Cloud Marketplace, and we rely on these and other third-party service providers and technologies to operate critical business systems to process Sensitive Data in a variety of contexts, including, without limitation, other cloud-based infrastructure, data center facilities, encryption and authentication technology, employee email, content delivery to customers, and other functions.
+Added: We may also rely on third-party service providers to provide other products, services, parts, or otherwise to operate our business.
+Added: Our ability to monitor these third parties’ information security practices is limited.
+Added: Although we understand our third-party cloud providers have implemented security measures designed to protect against various cybersecurity risks and vulnerabilities, these and other third parties may nevertheless not have adequate information security measures in place.
+Added: If our third-party service providers experience a security incident or other interruption, we could experience adverse consequences.
+Added: While we may be entitled to damages if our third-party service providers fail to satisfy their privacy or security-related obligations to us, any award may be insufficient to cover our damages, or we may be unable to recover such award.
+Added: In addition, supply-chain attacks have increased in frequency and severity, and we cannot guarantee that third parties’ infrastructure in our supply chain or our third-party partners’ supply chains have not been compromised.
+Added: Any of the previously identified or similar threats could cause a security incident or other interruption that could result in unauthorized, unlawful, or accidental acquisition, modification, destruction, loss, alteration, encryption, disclosure of, or access to our Sensitive Data (including proprietary information and intellectual property) or our information technology systems, or those of the third parties upon whom we rely.
+Added: A security incident or other interruption could disrupt our ability (and that of third parties upon whom we rely) to provide our services.
+Added: We may expend significant resources or modify our business activities to try to protect against security incidents.
+Added: Additionally, certain data privacy and security obligations may require us to implement and maintain specific security measures or industry-standard or reasonable security measures to protect our information technology systems and Sensitive Data.
+Added: While we have implemented security measures designed to protect against security incidents, there can be no assurance that these measures will be effective.
+Added: We take steps to detect and remediate vulnerabilities in our information technology systems (including in our services), but we may not be able to detect and remediate all vulnerabilities because the threats and techniques used to exploit vulnerabilities change frequently and, are often sophisticated in nature.
+Added: Therefore, such vulnerabilities could be exploited but, may not be detected until after a
+Added: security incident has occurred.
+Added: These vulnerabilities pose material risks to our business.
+Added: Further, we may experience delays in developing and deploying remedial measures designed to address any such identified vulnerabilities.
+Added: As a result, we may be unable to implement adequate preventative and responsive measures to stop or mitigate security breaches before or while they are occurring.
+Added: Applicable data privacy and security obligations may require us to notify relevant stakeholders of security incidents.
+Added: Such disclosures are costly, and the disclosure or the failure to comply with such requirements could lead to adverse consequences.
+Added: If we (or a third party upon whom we rely) experience a security incident or are perceived to have experienced a security incident, we may experience adverse consequences.
+Added: These consequences may include:
+Added: exposure of Sensitive Data (including intellectual property or confidential or proprietary information);
+Added: government enforcement actions (for example, investigations, fines, penalties, audits, and inspections);
+Added: additional reporting requirements and/or oversight;
+Added: restrictions on Processing Sensitive Data (including personal data);
+Added: litigation (including class claims);
+Added: indemnification obligations;
+Added: negative publicity;
+Added: reputational harm;
+Added: monetary fund diversions;
+Added: interruptions in our operations (including availability of data);
+Added: financial loss;
+Added: and other similar harms.
+Added: Security incidents and attendant consequences may cause customers to stop using our services, deter new customers from using our services, and negatively impact our ability to grow and operate our business.
Our efforts to prevent and overcome these challenges could increase our expenses and may not be successful.
−Removed: If we fail to detect or remediate a security breach in a timely manner, or a breach otherwise affects our customers, or if we suffer a cyber- attack that impacts our ability to operate our platform, we may suffer material damage to our reputation, business, financial condition and results of operations.
+Added: Our contracts may not contain limitations of liability, and even where they do, there can be no assurance that limitations of liability in our contracts are sufficient to protect us from liabilities, damages, or claims related to our data privacy and security obligations.
+Added: We cannot be sure that our insurance coverage will be adequate or sufficient to protect us from or to mitigate liabilities arising out of our privacy and security practices, that such coverage will continue to be available on commercially reasonable terms or at all, or that such coverage will pay future claims.
+Added: In addition to experiencing a security incident, third parties may gather, collect, or infer sensitive information about us from public sources, data brokers, or other means that reveals competitively sensitive details about our organization and could be used to undermine our competitive advantage or market position.
Unfavorable conditions in our industry or the global economy, could limit our ability to grow our business and negatively affect our results of operations.
Our results of operations may vary based on the impact of changes in our industry or the global economy on the company or our customers and potential customers.
−Removed: Negative conditions in the general economy both in the United States and abroad, including conditions resulting from changes in gross domestic product growth, financial and credit market fluctuations, international trade relations, pandemics (such as the COVID-19 pandemic), political turmoil, natural disasters or other catastrophic events, warfare, terrorist attacks on the United States or elsewhere, and geopolitical tensions, such as Russia’s recent incursion into Ukraine, could cause a decrease in business investments, including the progress on development of quantum technologies, and negatively affect the growth of our business.
+Added: The global economy, including credit and financial markets, has experienced extreme volatility and disruptions, including severely diminished liquidity and credit availability, declines in consumer confidence, declines in economic growth, increases in unemployment rates, increases in inflation rates, higher interest rates and uncertainty about economic stability.
+Added: For example, the COVID-19 pandemic resulted in widespread unemployment, economic slowdown and extreme volatility in the capital markets and any future public health crises could result in similar impacts on the global economy.
+Added: Similarly, the Russia-Ukraine war has created extreme volatility in the global capital markets and is expected to have further global economic consequences, including disruptions of the global supply chain and energy markets.
+Added: Increased inflation rates can adversely affect us by increasing our costs, including labor and employee benefit costs.
+Added: Employee salaries and benefits expenses have increased as a result of economic growth, increased demand for business services, increased competition for trained and talented employees, among other wage-inflationary pressures and we cannot assure that they will not continue to rise.
+Added: In addition, higher inflation also could increase our customers’ operating costs, which could result in reduced budgets for our customers and potentially less demand for our platform and the development of quantum technologies.
+Added: Any significant increases in inflation and related increase in interest rates could have a material adverse effect on our business, results of operations and financial condition.
In addition, in challenging economic times, our current or potential future customers may experience cash flow problems and as a result may modify, delay or cancel plans to purchase our products and services.
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We may accept government grants that place restrictions on our ability to operate.
−Removed: Our operating and financial results forecast relies in large part upon assumptions and analyses we have developed.
−Removed: If these assumptions or analyses prove to be incorrect, our actual operating results may be materially different from our forecasted results.
−Removed: Our projected financial and operating information reflect current estimates of future performance, which may never occur.
−Removed: Whether actual operating and financial results and business developments will be consistent with our expectations and assumptions as reflected in our forecasts depends on a number of factors, many of which are outside our control, including, but not limited to:
−Removed: success and timing of development activity;
−Removed: customer acceptance of our quantum computing systems;
−Removed: breakthroughs in classical computing or other computing technologies that could eliminate the advantages of quantum computing systems rendering them less practical to customers;
−Removed: competition, including from established and future competitors;
−Removed: whether we can obtain sufficient capital to sustain and grow our business;
−Removed: our ability to manage our growth;
−Removed: our ability to retain existing key management, integrate recent hires and attract, retain and motivate qualified personnel;
−Removed: the overall strength and stability of domestic and international economies.
−Removed: Unfavorable changes in any of these or other factors, most of which are beyond our control, could materially and adversely affect our business, financial condition and results of operations.
Acquisitions, divestitures, strategic investments and strategic partnerships could disrupt our business and harm our financial condition and operating results.
−Removed: We may pursue growth opportunities by acquiring complementary businesses, solutions or technologies through strategic transactions, investments or partnerships.
+Added: We have pursued and we may continue to pursue growth opportunities by acquiring complementary businesses, solutions or technologies through strategic transactions, investments or partnerships.
The identification of suitable acquisition, strategic investment or strategic partnership candidates can be costly and time consuming and can distract our management team from our current operations.
2 unchanged sentences
Even if we successfully complete a strategic transaction, we may not be able to effectively integrate the acquired business, technology, systems, control environment, solutions, personnel or operations into our business.
−Removed: We may experience unexpected changes in how we are required to account for strategic transactions pursuant to U.S.
+Added: We may experience unexpected changes in how we are required to account for strategic transactions pursuant to accounting principles generally accepted in the United States of America (“U.S.
GAAP”) and may not achieve the anticipated benefits of any strategic transaction.
We may incur unexpected costs, claims or liabilities that we incur during the strategic transaction or that we assume from the acquired company, or we may discover adverse conditions post acquisition for which we have limited or no recourse.
−Removed: We have been, and may in the future be, adversely affected by the global COVID-19 pandemic, its various strains or future pandemics.
−Removed: We face various risks related to epidemics, pandemics, and other outbreaks, including the COVID-19 pandemic, including newly discovered strains of the virus.
−Removed: In response to the COVID-19 pandemic, governments have implemented significant measures, including, but not limited to, business closures, quarantines, travel restrictions, shelter-in-place, stay-at-home and other social distancing directives, intended to control the spread of the virus.
−Removed: Companies have also taken precautions, such as requiring employees to work remotely, imposing travel
−Removed: restrictions and temporarily closing businesses.
−Removed: To the extent that these restrictions remain in place, additional prevention and mitigation measures are implemented in the future, or there is uncertainty about the effectiveness of these or any other measures or the likelihood of achieving widespread global vaccination rates as part of the broadscale efforts to contain or treat COVID-19 or future pandemics, there is likely to be an adverse impact on our potential customers, our employees and global economic conditions, and consumer confidence and spending, which could materially and adversely affect our operations and demand for our products.
−Removed: The spread of COVID-19 has and may continue to impact our suppliers by disrupting the manufacturing, delivery and the overall supply chain of parts required to manufacture our quantum computers.
−Removed: In addition, various aspects of our business cannot be conducted remotely, such as the assembly of our quantum computers.
−Removed: These measures by government authorities may remain in place for a significant period of time and they are likely to continue to adversely affect our future manufacturing plans, sales and marketing activities, business and results of operations.
−Removed: We may take further actions as may be required by government authorities or that we determine are in the best interests of our employees, suppliers, vendors and business partners.
−Removed: Due to the fluid nature of the COVID-19 pandemic and uncertainties regarding the related economic impact are likely to result in sustained market turmoil, which could also negatively impact the company’s business, financial condition and cash flows.
−Removed: The extent of COVID-19’s effect on our operational and financial performance will depend on future developments, including the duration, spread and intensity of the pandemic, all of which are uncertain and difficult to predict considering the rapidly evolving landscape.
−Removed: As a result, it is not currently possible to ascertain the overall impact of COVID-19 on our business.
−Removed: However, if the pandemic continues to persist as a severe worldwide health crisis, the disease could negatively impact our business, financial condition results of operations and cash flows, and may also have the effect of heightening many of the other risks described in this “Risk Factors” section.
−Removed: Even after the COVID-19 pandemic has subsided, we may continue to experience an adverse impact to our business as a result of COVID-19’s global economic impact, including any recession that has occurred or may occur in the future and the uncertainty of the timing of the broader economic recovery to pre-pandemic levels.
+Added: Risks Related to Our International Expansion and Future Operations
+Added: Because our success depends, in part, on our ability to expand sales internationally, our business will be susceptible to risks associated with international operations.
+Added: We currently maintain offices and/or have personnel in the United States and Canada, and recently expanded operations to Germany, Israel, and Canada.
+Added: We expect to continue to expand our international operations by developing a sales and operations presence in other international markets, which may include opening offices in new jurisdictions.
+Added: Any additional international expansion efforts that we are undertaking and may undertake may not be successful.
+Added: In addition, conducting international operations subjects us to new risks,
+Added: some of which we have not generally faced in the United States or other countries where we currently operate.
+Added: These risks include, among other things:
+Added: lack of familiarity and burdens of complying with foreign laws, legal standards, privacy and cybersecurity standards, regulatory requirements, tariffs and other barriers, and the risk of penalties to our customers and individual members of management or employees if our practices are deemed to not be in compliance;
+Added: practical difficulties of enforcing intellectual property rights in countries with varying laws and standards and reduced or varied protection for intellectual property rights in some countries;
+Added: an evolving legal framework and additional legal or regulatory requirements for data privacy and cybersecurity, which may necessitate the establishment of systems to maintain data in local markets, requiring us to invest in additional data centers and network infrastructure, and the implementation of additional employee data privacy documentation (including locally compliant data privacy notice and policies), all of which may involve substantial expense and may cause us to need to divert resources from other aspects of our business, all of which may adversely affect our business;
+Added: unexpected changes in regulatory requirements, taxes, trade laws, tariffs, export quotas, custom duties or other trade restrictions;
+Added: difficulties in managing systems integrators and partners;
+Added: differing technology standards;
+Added: different pricing environments, longer sales cycles, longer accounts receivable payment cycles and difficulties in collecting accounts receivable;
+Added: increased financial accounting and reporting burdens and complexities;
+Added: difficulties in managing and staffing international operations including the proper classification of independent contractors and other contingent workers, differing employer/employee relationships and local employment laws;
+Added: increased costs involved with recruiting and retaining an expanded employee population outside the United States through cash and equity-based incentive programs and unexpected legal costs and regulatory restrictions in issuing our shares to employees outside the United States;
+Added: global political and regulatory changes that may lead to restrictions on immigration and travel for our employees;
+Added: fluctuations in exchange rates that may decrease the value of our foreign-based revenue or increase the cost of our foreign operations;
+Added: global public health threats;
+Added: potentially adverse tax consequences, including the complexities of foreign value added tax (or other tax) systems, restrictions on the repatriation of earnings, and transfer pricing requirements;
+Added: permanent establishment risks and complexities in connection with international payroll, tax and social security requirements for international employees.
+Added: Additionally, operating in international markets also requires significant management attention and financial resources.
+Added: We cannot be certain that the investment and additional resources required in establishing operations in other countries will produce desired levels of revenue or profitability.
+Added: Compliance with laws and regulations applicable to our global operations also substantially increases our cost of doing business in foreign jurisdictions.
+Added: We have limited experience in marketing, selling and supporting our platform outside of the United States.
+Added: Our limited experience in operating our business internationally increases the risk that any potential future expansion efforts that we may undertake will not be successful.
+Added: invest substantial time and resources to expand our international operations and are unable to do so successfully and in a timely manner, our business, financial condition, revenues, results of operations or cash flows will suffer.
+Added: We may be unable to keep current with changes in government requirements as they change from time to time.
+Added: Failure to comply with these regulations could harm our business.
+Added: In many countries, it is common for others to engage in business practices that are prohibited by our internal policies and procedures or other regulations applicable to us.
+Added: Although we have implemented policies and procedures designed to ensure compliance with these laws and policies, there can be no assurance that all of our employees, contractors, partners and agents will comply with these laws and policies.
+Added: Violations of laws or key control policies by our employees, contractors, partners or agents could result in delays in revenue recognition, financial reporting misstatements, enforcement actions, reputational harm, disgorgement of profits, fines, civil and criminal penalties, damages, injunctions, other collateral consequences or the prohibition of the importation or exportation of our solutions and could harm our business, financial condition, revenues, results of operations or cash flows.
+Added: Our international sales and operations subject us to additional risks and costs, including the ability to engage with customers in new geographies and exposure to foreign currency exchange rate fluctuations, that can adversely affect our business, financial condition, revenues, results of operations or cash flows.
+Added: We are continuing to expand our international operations as part of our growth strategy.
+Added: However, there are a variety of risks and costs associated with our international sales and operations, which include making investments prior to the sales or use of quantum computers, the cost of conducting our business internationally and hiring and training international employees and the costs associated with complying with local law.
+Added: Furthermore, we cannot predict the rate at which our quantum computers will be accepted in international markets by potential customers.
+Added: We have a limited sales presence in Germany and Israel;
+Added: and, as a result, our sales, support and engineering organization outside the United States is substantially smaller than our U.S.
+Added: sales organization.
+Added: We believe our ability to attract new customers to subscribe to our platform or to attract existing customers to renew or expand their use of our platform is directly correlated to the level of engagement we obtain with the customer.
+Added: To the extent we are unable to effectively engage with non-U.S.
+Added: customers due to our limited sales force capacity, we may be unable to effectively grow in international markets.
+Added: As our international operations expand, our exposure to the effects of fluctuations in currency exchange rates grows.
+Added: While we have primarily transacted with customers in U.S.
+Added: dollars, historically, we expect to continue to expand the number of transactions with our customers that are denominated in foreign currencies in the future.
+Added: Additionally, fluctuations in the value of the U.S.
+Added: dollar and foreign currencies may make our subscriptions more expensive for international customers, which could harm our business.
+Added: Additionally, we incur expenses for employee compensation and other operating expenses for our non-U.S.
+Added: employees in the local currency for such locations.
+Added: Fluctuations in the exchange rates between the U.S.
+Added: dollar and other currencies could result in an increase to the U.S.
+Added: dollar equivalent of such expenses.
+Added: These fluctuations could cause our results of operations to differ from our expectations or the expectations of our investors.
+Added: Additionally, such foreign currency exchange rate fluctuations could make it more difficult to detect underlying trends in our business and results of operations.
+Added: Our international operations may subject us to greater than anticipated tax liabilities.
+Added: The amount of taxes we may pay in different jurisdictions depends on the application of the tax laws of various jurisdictions, including the United States, to our international business activities, changes in tax rates, new or revised tax laws or interpretations of existing tax laws and policies, and our ability to operate our business in a manner consistent with our corporate structure and intercompany arrangements.
+Added: The taxing authorities of the jurisdictions in which we operate may challenge our methodologies for pricing intercompany transactions pursuant to any future intercompany arrangement or disagree with our determinations as to the income and expenses attributable to specific jurisdictions.
+Added: If such a challenge or disagreement were to occur, and our position
+Added: was not sustained, we could be required to pay additional taxes, interest and penalties, which could result in one-time tax charges, higher effective tax rates, reduced cash flows, and lower overall profitability of our operations.
+Added: Our financial statements could fail to reflect adequate reserves to cover such a contingency.
+Added: Similarly, a taxing authority could assert that we are subject to tax in a jurisdiction where we believe we have not established a taxable connection, often referred to as a “permanent establishment” under international tax treaties, and such an assertion, if successful, could increase our expected tax liability in one or more jurisdictions.
Risks Related to Litigation and Government Regulation
−Removed: State, federal and foreign laws and regulations related to privacy, data use and security could adversely affect us.
−Removed: We are subject to state and federal laws and regulations related to privacy, data use and security.
−Removed: In addition, in recent years, there has been a heightened legislative and regulatory focus on data security, including requiring consumer notification in the event of a data breach.
−Removed: Legislation has been introduced in Congress and there have been several Congressional hearings addressing these issues.
−Removed: From time to time, Congress has considered, and may do so again, legislation establishing requirements for data security and response to data breaches that, if implemented, could affect us by increasing our costs of doing business.
−Removed: In addition, several states have enacted privacy or security breach legislation requiring varying levels of consumer notification in the event of a security breach.
−Removed: For example, the California Consumer Privacy Act (“CCPA”), which enhances consumer protection and privacy rights by granting consumers resident in California new rights with respect to the collection of their personal data and imposing new operational requirements on businesses, went into effect in January 2020.
−Removed: The CCPA includes a statutory damages framework and private rights of action against businesses that fail to comply with certain CCPA terms or implement reasonable security procedures and practices to prevent data breaches.
−Removed: Several other states are considering similar legislation.
−Removed: Foreign governments are raising similar privacy and data security concerns.
−Removed: In particular, the European Union enacted a General Data Protection Regulation (“GDPR”) in May 2018 which imposes strict requirements on how we and third parties with whom we contract collect, share, export or otherwise process personal information, and provide for significant penalties for noncompliance.
−Removed: China, Russia, Japan and other countries in Latin America and Asia are also strengthening their privacy laws and the enforcement of privacy and data security requirements.
−Removed: Complying with such laws and regulations may be time- consuming and require additional resources, and could therefore harm our business, financial condition and results of operations.
−Removed: We are subject to U.S.
−Removed: and foreign anti-corruption, anti-bribery and similar laws, and non-compliance with such laws can subject us to criminal or civil liability and harm our business.
−Removed: We are subject to the U.S.
−Removed: Foreign Corrupt Practices Act of 1977, as amended, the U.S.
−Removed: domestic bribery statute contained in 18 U.S.C.
−Removed: § 201, the U.S.
−Removed: Travel Act, and other anti-bribery, and anti-corruption laws in countries in which we conduct activities.
−Removed: Anti-corruption and anti-bribery laws have been enforced aggressively in recent years and are interpreted broadly to generally prohibit companies, their employees, and their third-party intermediaries from authorizing, promising, offering, providing, soliciting, or accepting, directly or indirectly, improper payments or benefits to or from any person whether in the public or private sector.
−Removed: We may engage with partners and third-party intermediaries to market our services and to obtain necessary permits, licenses, and other regulatory approvals.
−Removed: In addition, we or our third-party intermediaries may have direct or indirect interactions with officials and employees of government agencies or state-owned or affiliated entities.
−Removed: We can be held liable for the corrupt or other illegal activities of these third-party intermediaries, and of our employees, representatives, contractors, partners, and agents, even if we do not explicitly authorize such activities.
−Removed: We cannot provide any assurance that all of our employees and agents will not take actions in violation of our policies and applicable law, for which we may be ultimately held responsible.
−Removed: Detecting, investigating, and resolving actual or alleged violations of anti-corruption laws can require a significant diversion of time, resources, and attention from senior management.
−Removed: In addition, noncompliance with anti-corruption or anti-bribery laws could subject us to whistleblower complaints, investigations, sanctions, settlements, prosecution, enforcement actions, fines, damages, other civil or criminal penalties, injunctions, suspension or debarment from contracting with certain persons, reputational harm, adverse media coverage, and other collateral consequences.
−Removed: We are subject to governmental export and import controls that could impair our ability to compete in international markets due to licensing requirements and subject us to liability if we are not in compliance with applicable laws.
−Removed: Our products and technologies are subject to U.S.
−Removed: export control and import laws and regulations, including the U.S.
−Removed: Export Administration Regulations, U.S.
−Removed: Customs regulations, and various economic and trade sanctions regulations administered by the U.S.
−Removed: Treasury Department’s Office of Foreign Assets Controls.
−Removed: export control and economic sanctions laws include restrictions or prohibitions on the sale or supply of certain products, technologies, and services to U.S.
−Removed: Government embargoed or sanctioned countries, governments, persons and entities.
−Removed: In addition, certain products and technology may be subject to export licensing or approval requirements.
−Removed: Exports of our products and technology must be made in compliance with export control and sanctions laws and regulations.
−Removed: If we fail to comply with these laws and regulations, we and certain of our employees could be subject to substantial civil or criminal penalties, including the possible loss of export or import privileges;
−Removed: fines, which may be imposed on us and responsible employees or managers;
−Removed: and, in extreme cases, the incarceration of responsible employees or managers.
−Removed: In addition, changes in our products or technologies or changes in applicable export or import laws and regulations may create delays in the introduction and sale of our products and technologies in international markets or, in some cases, prevent the export or import of our products and technologies to certain countries, governments or persons altogether.
−Removed: Any change in export or import laws and regulations, shift in the enforcement or scope of existing laws and regulations, or change in the countries, governments, persons or technologies targeted by such laws and regulations, could also result in decreased use of our products and technologies, or in our decreased ability to export or sell our products and technologies to existing or potential customers.
−Removed: Any decreased use of our products and technologies or limitation on our ability to export or sell our products and technologies would likely adversely affect our business, financial condition and results of operations.
−Removed: We expect to incur significant costs in complying with these regulations.
−Removed: Regulations related to quantum computing are currently evolving and we may face additional risks associated with changes to these regulations.
Our business is exposed to risks associated with litigation, investigations and regulatory proceedings.
−Removed: We may in the future face legal, administrative and regulatory proceedings, claims, demands and/or investigations involving stockholder, consumer, competition and/or other issues relating to our business.
+Added: We may face legal, administrative and regulatory proceedings, claims, demands and/or investigations involving stockholder, consumer, competition and/or other issues relating to our business.
Litigation and regulatory proceedings are inherently uncertain, and adverse rulings could occur, including monetary damages, or an injunction stopping us from engaging in certain business practices, or requiring other remedies, such as compulsory licensing of patents.
11 unchanged sentences
The Counterclaim Defendants have denied the claims against them and have a motion to dismiss the suit.
−Removed: An unfavorable outcome or settlement in a legal, administrative and regulatory proceeding may result in a material adverse impact on our business, results of operations, financial position and overall trends.
+Added: In May 2022, a securities class action complaint captioned Leacock v.
+Added: et al., Case No.
+Added: 8:22-cv-01306, was filed by a stockholder of the Company in the United States District Court for the District of Maryland (the “Leacock Litigation”) against the Company and certain of the Company’s current officers.
+Added: In June 2022, a securities class action complaint captioned Fisher v.
+Added: IonQ, Inc., Case No.
+Added: 8:22-cv-01306-DLB (the “Fisher Litigation”) was filed by a stockholder against the Company and certain of the Company’s current officers (the “IonQ Defendants”).
+Added: Both the Leacock Litigation and Fisher Litigation, which have been consolidated into a single action, allege violations of Section 10(b) of the Exchange Act, and Rule 10b-5 promulgated thereunder, and Section 20(a) of the Exchange Act and seek damages.
+Added: In September 2022, the Court appointed lead plaintiffs and counsel for lead plaintiffs, and ordered lead plaintiffs to file a consolidated amended complaint.
+Added: The consolidated amended complaint was filed on November 22, 2022.
+Added: As part of the consolidated amended complaint, certain members of the Company’s board of directors (the “Board”) as well as other dMY related defendants (“Additional Defendants”) have been added as defendants to the case.
+Added: On February 7, 2023, the IonQ Defendants and the Additional Defendants each filed a motion to dismiss the consolidated amended complaint.
+Added: Both the IonQ Defendants and the Additional Defendants believe that the allegations in the various complaints are without merit and intend to defend the matters vigorously.
+Added: These proceedings and any additional investigations, inquiries or litigation by various regulators may harm our reputation regardless of the outcome of any such action.
+Added: The outcome of any litigation, regardless of its merits, is inherently uncertain.
+Added: Any claims and lawsuits, and the disposition of such claims and lawsuits, could be
+Added: time-consuming and expensive to resolve, divert management attention and resources, and lead to attempts on the part of other parties to pursue similar claims.
+Added: Negative perceptions of our business may result in additional regulation, enforcement actions by the government and increased litigation, or harm to our ability to attract or retain customers or strategic partners, any of which may affect our business.
+Added: Any damage to our reputation, including from publicity from legal proceedings against us or companies that work within our industry, governmental proceedings, unfavorable media coverage or class action could adversely affect our business, financial condition and results of operations.
+Added: An unfavorable outcome or settlement or any other legal, administrative and regulatory proceeding may result in a material adverse impact on our business, results of operations, financial position and overall trends.
In addition, regardless of the outcome, litigation can be costly, time-consuming, and disruptive to our operations.
21 unchanged sentences
Consequences may include litigation, regulation, fines, increased insurance premiums, mandates to temporarily halt production, workers’ compensation claims, or other actions that impact the company brand, finances, or ability to operate.
+Added: Contracts with U.S.
+Added: government entities subject us to risks, including early termination, audits, investigations, sanctions and penalties.
+Added: As part of our business strategy, we have entered into and may enter into additional contracts with state and federal government entities, which subjects our business to statutes and regulations applicable to companies doing business with the government, including the Federal Acquisition Regulation.
+Added: These government contracts customarily contain provisions that give the government substantial rights and remedies, many of which are not typically found in commercial contracts and which are unfavorable to contractors.
+Added: For instance, most U.S.
+Added: government agencies include provisions that allow the government to unilaterally terminate or modify contracts for convenience, and in that event, the counterparty to the contract may generally recover only its incurred or committed costs and settlement expenses and profit on work completed prior to the termination.
+Added: If the government terminates a contract for default, the defaulting party may be liable for any extra costs incurred by the government in procuring undelivered items from another source.
+Added: In addition, government contracts normally contain additional requirements that may increase our costs of doing business, reduce our profits, and expose us to liability for failure to comply with these terms and conditions.
+Added: These requirements include, for example:
+Added: specialized disclosure and accounting requirements unique to government contracts;
+Added: financial and compliance audits that may result in potential liability for price adjustments, recoupment of government funds after such funds have been spent, civil and criminal penalties, or administrative sanctions such as suspension or debarment from doing business with the U.S.
+Added: public disclosures of certain contract and company information;
+Added: mandatory socioeconomic compliance requirements, including labor requirements, non-discrimination and affirmative action programs and environmental compliance requirements.
+Added: Government contracts are also generally subject to greater scrutiny by the government, which can initiate reviews, audits and investigations regarding our compliance with government contract requirements.
+Added: In addition, if we fail to comply with government contracting laws, regulations and contract requirements, our contracts may be subject to termination, and we may be subject to financial and/or other liability under our contracts, the Federal Civil False Claims Act (including treble damages and other penalties), or criminal law.
+Added: In particular, the False Claims Act’s “whistleblower” provisions also allow private individuals, including present and former employees, to sue on behalf of the U.S.
+Added: Any penalties, damages, fines, suspension, or damages could adversely affect our ability to operate our business and our financial results.
+Added: We are subject to stringent and evolving U.S.
+Added: and foreign laws, regulations, rules, contractual obligations, policies and other obligations related to data privacy and security.
+Added: Our actual or perceived failure to comply with such obligations could lead to adverse business consequences.
+Added: Our data processing activities may subject us to numerous data privacy and security obligations, such as various laws, regulations, guidance, industry standards, external and internal privacy and security policies, contractual requirements, and other obligations relating to data privacy and security.
+Added: In the United States, federal, state, and local governments have enacted numerous data privacy and security laws, including data breach notification laws, personal data privacy laws, consumer protection laws (e.g., Section 5 of the Federal Trade Commission Act), and other similar laws (e.g., wiretapping laws).
+Added: For example, the California Consumer Privacy Act of 2018 (“CCPA”) applies to personal information of California consumers, business representatives and employees, and requires businesses to provide specific disclosures in privacy notices and honor requests of California residents to exercise certain privacy rights.
+Added: The CCPA provides for civil penalties of up to $7,500 per violation and allows private litigants affected by certain data breaches to recover significant statutory damages.
+Added: In addition, the California Privacy Rights Act of 2020 (“CPRA”) expands the CCPA’s requirements, including by adding a new right for individuals to correct their personal information and establishing a new regulatory agency to implement and enforce the law.
+Added: Other states, such as Virginia and Colorado, have also passed comprehensive privacy laws, and similar laws are being considered in several other states, as well as at the federal and local levels.
+Added: Additionally, several states and localities have enacted measures related to the use of artificial intelligence and machine learning in products and services.
+Added: These developments may further complicate compliance efforts, and may increase legal risk and compliance costs for us, the third parties upon whom we rely, and our customers.
+Added: Outside the United States, an increasing number of laws, regulations, and industry standards may govern data privacy and security.
+Added: For example, the European Union’s General Data Protection Regulation (“EU GDPR”), the United Kingdom’s General Data Protection Regulation (“UK GDPR”), Brazil’s General Data Protection Law (Lei Geral de Proteção de Dados Pessoais, or “LGPD”) (Law No.
+Added: 13,709/2018), and China’s Personal Information Protection Law (“PIPL”) impose strict requirements for processing personal data.
+Added: For example, under the EU GDPR, companies may face temporary or definitive bans on data processing and other corrective actions;
+Added: fines of up to 20 million Euros or 4% of annual global revenue, whichever is greater;
+Added: or private litigation related to processing of personal data brought by classes of data subjects or consumer protection organizations authorized at law to represent their interests.
+Added: Additionally, we also target customers in Asia and may be subject to new and emerging data privacy regimes in Asia, including China’s PIPL, Japan’s Act on the Protection of Personal Information, and Singapore’s Personal Data Protection Act.
+Added: In addition, we may be unable to transfer personal data from Europe and other jurisdictions to the United States or other countries due to data localization requirements or limitations on cross-border data flows.
+Added: Europe and other jurisdictions have enacted laws requiring data to be localized or limiting the transfer of personal data to other countries.
+Added: In particular, the European Economic Area (“EEA”) and the United Kingdom (“UK”) have significantly restricted the transfer of personal data to the United States and other countries whose privacy laws it believes are inadequate.
+Added: Other jurisdictions may adopt similarly stringent interpretations of their data localization and cross-border data transfer laws.
+Added: Although there are currently various mechanisms that may be used to transfer personal data from the EEA and UK to the United States in compliance with law, such as the EEA and UK’s standard contractual clauses, these mechanisms are subject to legal challenges, and there is no assurance that we can satisfy or rely on these measures to lawfully transfer personal data to the United States.
+Added: If there is no lawful manner for us to transfer personal data from the EEA, the UK, or other jurisdictions to the United States, or if the requirements for a legally-compliant transfer are too onerous, we could face significant adverse consequences, including the interruption or degradation of our operations, the need to relocate part of or all of our business or data processing activities to other jurisdictions at significant expense, increased exposure to regulatory actions, substantial fines and penalties, the inability to transfer data and work with partners, vendors and other third parties, and injunctions against our processing or transferring of personal data necessary to operate our business.
+Added: Additionally, companies that transfer personal data out of the EEA and UK to other jurisdictions, particularly to the United States, are subject to increased scrutiny from regulators, individual litigators, and activist groups.
+Added: Some European regulators have ordered certain companies to suspend or permanently cease certain transfers of personal data out of Europe for allegedly violating the EU GDPR’s cross-border data transfer limitations.
+Added: In addition to data privacy and security laws, we are contractually subject to industry standards adopted by industry groups and may become subject to such obligations in the future.
+Added: We are also bound by other contractual obligations related to data privacy and security, and our efforts to comply with such obligations may not be successful.
+Added: For example, certain privacy laws, such as the EU GDPR, UK GDPR and CCPA, require our customers to impose specific contractual restrictions on their service providers.
+Added: Additionally, some of our customers may require us to host personal data locally.
+Added: We publish privacy policies, marketing materials, and other statements, such as compliance with certain certifications or self-regulatory principles, regarding data privacy and security.
+Added: If these policies, materials or statements are found to be deficient, lacking in transparency, deceptive, unfair, or misrepresentative of our practices, we may be subject to investigation, enforcement actions by regulators, or other adverse consequences.
+Added: Obligations related to data privacy and security are quickly changing, becoming increasingly stringent, and creating regulatory uncertainty.
+Added: Additionally, these obligations may be subject to differing applications and interpretations, which may be inconsistent or conflict among jurisdictions.
+Added: Preparing for and complying with these obligations requires us to devote significant resources and may necessitate changes to our services, information technologies, systems, and practices and to those of any third parties that process personal data on our behalf.
+Added: We may at times fail (or be perceived to have failed) in our efforts to comply with our data privacy and security obligations.
+Added: Moreover, despite our efforts, our personnel or third parties on whom we rely may fail to comply with such obligations, which could negatively impact our business operations.
+Added: If we or the third parties on which we rely fail, or are perceived to have failed, to address or comply with applicable data privacy and security obligations, we could face significant consequences, including but not limited to:
+Added: government enforcement actions (e.g., investigations, fines, penalties, audits, inspections, and similar);
+Added: litigation (including class-action claims);
+Added: additional reporting requirements and/or oversight;
+Added: bans on processing personal data;
+Added: and orders to destroy or not use personal data.
+Added: Any of these events could have a material adverse effect on our reputation, business, or financial condition, including but not limited to:
+Added: loss of customers;
+Added: inability to process personal data or to operate in certain jurisdictions;
+Added: interruptions or stoppages in our business operations or data collection;
+Added: limited ability to develop or commercialize our products;
+Added: expenditure of time and resources to defend any claim or inquiry;
+Added: adverse publicity;
+Added: or substantial changes to our business model or operations.
+Added: We are subject to U.S.
+Added: and foreign anti-corruption, anti-bribery and similar laws, and non-compliance with such laws can subject us to criminal or civil liability and harm our business.
+Added: We are subject to the U.S.
+Added: Foreign Corrupt Practices Act of 1977, as amended, the U.S.
+Added: domestic bribery statute contained in 18 U.S.C.
+Added: § 201, the U.S.
+Added: Travel Act, and other anti-bribery, and anti-corruption laws in countries in which we conduct activities.
+Added: Anti-corruption and anti-bribery laws have been enforced aggressively in recent years and are interpreted broadly to generally prohibit companies, their employees, and their third-party intermediaries from authorizing, promising, offering, providing, soliciting, or accepting, directly or indirectly, improper payments or benefits to or from any person whether in the public or private sector.
+Added: We may engage with partners and third-party intermediaries to market our services and to obtain necessary permits, licenses, and other regulatory approvals.
+Added: In addition, we or our third-party intermediaries may have direct or indirect interactions with officials and employees of government agencies or state-owned or affiliated entities.
+Added: We can be held liable for the corrupt or other illegal activities of these third-party intermediaries, and of our employees, representatives, contractors, partners, and agents, even if we do not explicitly authorize such activities.
+Added: We cannot provide any assurance that all of our employees and agents will not take actions in violation of our policies and applicable law, for which we may be ultimately held responsible.
+Added: Detecting, investigating, and resolving actual or alleged violations of anti-corruption laws can require a significant diversion of time, resources, and attention from senior management.
+Added: In addition, noncompliance with anti-corruption or anti-bribery laws could subject us to whistleblower complaints, investigations, sanctions,
+Added: settlements, prosecution, enforcement actions, fines, damages, other civil or criminal penalties, injunctions, suspension or debarment from contracting with certain persons, reputational harm, adverse media coverage, and other collateral consequences.
+Added: We are subject to governmental export and import controls that could impair our ability to compete in international markets due to licensing requirements and subject us to liability if we are not in compliance with applicable laws.
+Added: Our products and technologies are subject to U.S.
+Added: export control and import laws and regulations, including the U.S.
+Added: Export Administration Regulations, U.S.
+Added: Customs regulations, and various economic and trade sanctions regulations administered by the U.S.
+Added: Treasury Department’s Office of Foreign Assets Controls.
+Added: export control and economic sanctions laws include restrictions or prohibitions on the sale or supply of certain products, technologies, and services to U.S.
+Added: government embargoed or sanctioned countries, governments, persons and entities.
+Added: In addition, certain products and technology may be subject to export licensing or approval requirements.
+Added: Exports of our products and technology must be made in compliance with export control and sanctions laws and regulations.
+Added: If we fail to comply with these laws and regulations, we and certain of our employees could be subject to substantial civil or criminal penalties, including the possible loss of export or import privileges;
+Added: fines, which may be imposed on us and responsible employees or managers;
+Added: and, in extreme cases, the incarceration of responsible employees or managers.
+Added: In addition, changes in our products or technologies or changes in applicable export or import laws and regulations may create delays in the introduction and sale of our products and technologies in international markets or, in some cases, prevent the export or import of our products and technologies to certain countries, governments or persons altogether.
+Added: Any change in export or import laws and regulations, shift in the enforcement or scope of existing laws and regulations, or change in the countries, governments, persons or technologies targeted by such laws and regulations, could also result in decreased use of our products and technologies, or in our decreased ability to export or sell our products and technologies to existing or potential customers.
+Added: Any decreased use of our products and technologies or limitation on our ability to export or sell our products and technologies would likely adversely affect our business, financial condition and results of operations.
+Added: We expect to incur significant costs in complying with these regulations.
+Added: Regulations related to quantum computing are currently evolving and we may face additional risks associated with changes to these regulations.
Risks Related to our Intellectual Property
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We are heavily reliant upon licenses to certain patent rights and other intellectual property from third parties that are important or necessary to the development of our products.
−Removed: In particular, our quantum computing technology is dependent on our license agreement with University of Maryland and Duke University (the “Universities”).
+Added: In particular, our quantum computing technology is dependent on our license agreement with University of Maryland and Duke University.
Significant intellectual property developed by our co-founders, Jungsang Kim, our Chief Technology Officer, and Christopher Monroe, our Chief Scientist, has been and is required to be assigned to the Universities as a result of Dr.
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Our business could significantly suffer, for example, if any current or future licenses terminate, if the licensors fail to abide by the terms of the license, if the licensed patents or other rights are found to be invalid or unenforceable, or if we are unable to enter into necessary licenses on acceptable terms.
−Removed: Licensing of intellectual property is of critical importance to our business and involves complex legal, business and scientific issues, and certain provisions in intellectual property license agreements may be
−Removed: susceptible to multiple interpretations.
+Added: Licensing of intellectual property is of critical importance to our business and involves complex legal, business and scientific issues, and certain provisions in intellectual property license agreements may be susceptible to multiple interpretations.
Disputes may arise between us and our licensors regarding intellectual property subject to a license agreement, including:
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We may not be able to prevent unauthorized use of our intellectual property.
−Removed: We rely upon a combination of the intellectual property protections afforded by patent, copyright, trademark and trade secret laws in the United States and other jurisdictions, as well as license agreements and other contractual protections, to establish, maintain and enforce rights in our proprietary technologies.
+Added: We rely upon a combination of the intellectual property protections afforded by patent, copyright, trademark and trade secret
+Added: laws in the United States and other jurisdictions, as well as license agreements and other contractual protections, to establish, maintain and enforce rights in our proprietary technologies.
In addition, we seek to protect our intellectual property rights through nondisclosure and invention assignment agreements with our employees and consultants, and through non-disclosure agreements with business partners and other third parties.
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There also may be pending patent applications of which we are not aware that may result in issued patents, which could be alleged to be infringed by our current or future products, services or technologies.
−Removed: Because patent
−Removed: applications can take years to issue and are often afforded confidentiality for some period of time there may currently be pending applications, unknown to us, that later result in issued patents that could cover our current or future products, services or technologies.
+Added: Because patent applications can take years to issue and are often afforded confidentiality for some period of time there may currently be pending applications, unknown to us, that later result in issued patents that could cover our current or future products, services or technologies.
Lawsuits can be time-consuming and expensive to resolve, and they divert management’s time and attention.
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Risks Related to an Investment in our Securities and Other General Matters
−Removed: There may not be an active trading market for our common stock or public warrants, which may make it difficult to sell such securities.
−Removed: It is possible that an active trading market will not develop or, if developed, that any market will not be sustained.
−Removed: This would make it difficult for you to sell shares of our common stock or public warrants at an attractive price or at all.
The market price of shares of our common stock or public warrants may be volatile, which could cause the value of your investment to decline.
−Removed: Even if an active trading market develops, the market price of our common stock or public warrants may be highly volatile and could be subject to wide fluctuations.
−Removed: Securities markets worldwide experience significant price and volume fluctuations.
−Removed: The securities markets have experienced significant volatility as a result of the COVID-19 pandemic and Russia’s recent incursion into Ukraine, among other factors.
+Added: If you purchase shares of our common stock, you may not be able to resell those shares at or above the price you paid.
+Added: The market price of our common stock may be highly volatile and may fluctuate or decline significantly in response to numerous factors, some of which are beyond our control.
+Added: The securities markets have experienced and continue to experience significant volatility.
Market volatility, as well as general economic, market or political conditions, could reduce the market price of shares of our common stock regardless of our operating performance.
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publication of research reports about our industry;
+Added: rumors and market speculation involving us or other companies in our industry, which may include short seller reports;
litigation and government investigations;
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changes in market valuations of similar companies;
−Removed: adverse publicity or speculation in the press or investment community;
announcements by competitors of significant contracts, acquisitions, dispositions, strategic partnerships, joint ventures, or capital commitments;
−Removed: the impact of the COVID-19 pandemic on our management, employees, partners, customers, and operating results.
−Removed: In response, the market price of shares of our common stock or public warrants could decrease significantly.
−Removed: You may be unable to resell your shares of our common stock at or above your purchase price.
+Added: the impact of any future bank failures, public health crises or geopolitical events such as the Russia-Ukraine war;
+Added: the impact of any of the foregoing on our management, employees, partners, customers, and operating results.
Following periods of volatility in the overall market and the market price of a company’s securities, securities class action litigation has often been instituted against such company.
−Removed: Such litigation, if instituted against us, could result in substantial costs and a diversion of management’s attention and resources.
−Removed: Unstable market and economic conditions may have serious adverse consequences on our business, financial condition and share price.
−Removed: The global economy, including credit and financial markets, has experienced extreme volatility and disruptions, including severely diminished liquidity and credit availability, declines in consumer confidence, declines in economic growth, increases in unemployment rates, increases in inflation rates, higher interest rates and uncertainty about economic stability.
−Removed: For example, the COVID-19 pandemic resulted in widespread unemployment, economic slowdown and extreme volatility in the capital markets.
−Removed: Similarly, Russia’s recent incursion of Ukraine has created extreme volatility in the global capital markets and is expected to have further global economic consequences, including disruptions of the global supply chain and energy markets.
−Removed: Any such volatility and disruptions may have adverse consequences on us or the third parties on whom we rely.
−Removed: If the equity and credit markets deteriorate, including as a result of political unrest or war, it may make any necessary debt or equity financing more difficult to obtain in a timely manner or on favorable terms, more costly or more dilutive.
−Removed: Increased inflation rates can adversely affect us by increasing our costs, including labor and employee benefit costs.
−Removed: In addition, higher inflation could also increase our customers’ operating costs, which could result in reduced budgets for our customers and potentially less demand for our products and services.
−Removed: Any significant increases in inflation and related increase in interest rates could have a material adverse effect on our business, results of operations and financial condition.
+Added: Such litigation could result in substantial costs and a diversion of management’s attention and resources.
+Added: See also “ —Risks Related to Litigation and Government Regulation—Our business is exposed to risks associated with litigation, investigations and regulatory proceedings .”
+Added: Short sellers may engage in manipulative activity intended to drive down the market price of our common stock, which could also result in related regulatory and governmental scrutiny, among other effects.
+Added: Short selling is the practice of selling securities that the seller does not own but rather has borrowed or intends to borrow from a third party with the intention of later buying lower priced identical securities to return to the lender.
+Added: Accordingly, it is in the interest of a short seller of our common stock for the price to decline.
+Added: At any time, short sellers may publish, or arrange for the publication of, opinions or characterizations that are intended to create negative market momentum.
+Added: Issuers, like us, whose securities have historically had limited trading history or volumes and/or have been susceptible to relatively high volatility levels can be vulnerable to such short seller attacks.
+Added: Short selling reports can cause increased volatility in an issuer’s stock price, and result in regulatory and governmental inquiries.
+Added: On May 3, 2022, a short seller report was published about us, which contained certain allegations against us.
+Added: Any inquiry or formal investigation from a governmental organization or other regulatory body, including any inquiry from the SEC or the U.S.
+Added: Department of Justice, could result in a material diversion of our management’s time and could have a material adverse effect on our business and results of operations.
+Added: There may not be an active trading market for our common stock or public warrants, which may make it difficult to sell such securities.
+Added: It is possible that an active trading market will not be sustained.
+Added: This would make it difficult for you to sell shares of our common stock or public warrants at an attractive price or at all.
Our ability to timely raise capital in the future may be limited, or may be unavailable on acceptable terms, if at all.
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Additional financing may not be available on favorable terms, if at all.
+Added: In addition, we may not be able to access a portion of our existing cash, cash equivalents and investments due to market conditions.
+Added: For example, on March 10, 2023, the Federal Deposit Insurance Corporation (“FDIC”) took control and was appointed receiver of Silicon Valley Bank (“SVB”).
+Added: Similarly, on March 12, 2023, Signature Bank and Silvergate Capital Corp.
+Added: were each swept into receivership.
+Added: If other banks and financial institutions enter receivership or become insolvent in the future in response to financial conditions affecting the banking system and financial markets, our ability to access our existing cash, cash equivalents and investments may be threatened and could have a material adverse effect on our business and financial condition.
+Added: Additionally, weakness and volatility in capital markets and the economy, in general or as a result of bank failures or macroeconomic conditions such as rising inflation, could limit our access to capital markets and increase our costs of borrowing.
If adequate funds are not available on acceptable terms, we may be unable to invest in future growth opportunities, which could harm our business, operating results and financial condition.
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The terms of any debt could restrict our operations, including our ability to pay dividends on our common stock.
−Removed: If we issue additional equity securities, stockholders will
−Removed: experience dilution, and the new equity securities could have rights senior to those of our common stock.
+Added: If we issue additional equity securities, stockholders will experience dilution, and the new equity securities could have rights senior to those of our common stock.
Because the decision to issue securities in the future offering will depend on numerous considerations, including factors beyond our control, we cannot predict or estimate the amount, timing or nature of any future issuances of debt or equity securities.
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A small number of stockholders will continue to have substantial control over us, which may limit other stockholders’ ability to influence corporate matters and delay or prevent a third party from acquiring control over us.
−Removed: Our directors and executive officers of, and beneficial owners of 5% or more of our voting securities and their respective affiliates beneficially own, in the aggregate, approximately 39.3% of our outstanding common stock.
−Removed: This significant concentration of ownership may have a negative impact on the trading price for our common stock because investors often perceive disadvantages in owning stock in companies with controlling stockholders.
+Added: As of December 31, 2022, our directors and executive officers of, and beneficial owners of 5% or more of our voting securities and their respective affiliates beneficially own, in the aggregate, approximately 20% of our outstanding common stock.
+Added: This concentration of ownership may have a negative impact on the trading price for our common stock because investors often perceive disadvantages in owning stock in companies with controlling stockholders.
In addition, these stockholders will be able to exercise influence over all matters requiring stockholder approval, including the election of directors and approval of corporate transactions, such as a merger or other sale of us or our assets.
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If we fail to satisfy the continued listing requirements of NYSE, such as the corporate governance requirements or the minimum share price requirement, NYSE may take steps to delist our securities.
−Removed: Such a delisting would likely have a negative effect on the price of the securities and would impair your ability to sell or purchase the securities when you wish to do so.
+Added: delisting would likely have a negative effect on the price of the securities and would impair your ability to sell or purchase the securities when you wish to do so.
In the event of a delisting, we can provide no assurance that any action taken by us to restore compliance with listing requirements would allow our securities to become listed again, stabilize the market price or improve the liquidity of our securities, prevent our securities from dropping below the NYSE minimum share price requirement or prevent future non-compliance with NYSE’s listing requirements.
−Removed: Additionally, if our securities are not listed on, or become delisted from, NYSE for any reason, and are quoted on the OTC Bulletin Board, an inter-dealer automated quotation system for equity securities that is not a national securities exchange, the liquidity and price of our securities may be more limited than if we were quoted or listed on NYSE or another national securities exchange.
+Added: Additionally, if our securities are not listed on, or become delisted from the NYSE, for any reason, and are quoted on the OTC Bulletin Board, an inter-dealer automated quotation system for equity securities that is not a national securities exchange, the liquidity and price of our securities may be more limited than if we were quoted or listed on the NYSE or another national securities exchange.
You may be unable to sell your securities unless a market can be established or sustained.
−Removed: If we are unable to implement and maintain effective internal control over financial reporting in the future, investors may lose confidence in the accuracy and completeness of financial reports, and the market price of our common stock may decline.
+Added: If we are unable to implement and maintain effective internal control over financial reporting, investors may lose confidence in the accuracy and completeness of financial reports, and the market price of our common stock may decline.
We are required to maintain internal controls over financial reporting and to report any material weaknesses in such internal controls.
The process of designing, implementing, and testing the internal control over financial reporting required to comply with this obligation is time-consuming, costly, and complicated.
−Removed: If we are unable to remediate any existing material weaknesses or if we identify additional material weaknesses in our internal control over financial reporting, if we are unable to comply with the requirements of Section 404 of Sarbanes-Oxley in a timely manner, or if we are unable to assert that our internal control over financial reporting is effective, we will be unable to certify that our internal control over financial reporting is effective.
−Removed: We cannot assure you that there will not be additional material weaknesses or significant deficiencies in our internal control over financial reporting in the future.
+Added: In connection with the preparation of our financial statements as of and for the year ended December 31, 2021, we identified a material weakness in our internal control over financial reporting specifically related to our financial statement close process.
+Added: Although we have remediated the material weakness as of December 31, 2022, there can be no assurance that the controls put in place will remain effective or that any additional controls needed will be designed and implemented timely to prevent material misstatements in our consolidated financial statements in future periods.
+Added: If we identify material weaknesses in our internal control over financial reporting in the future, if we are unable to comply with the requirements of Section 404 of Sarbanes-Oxley Act of 2002 in a timely manner, or if we are unable to assert that our internal control over financial reporting is effective, we will be unable to certify that our internal control over financial reporting is effective.
+Added: We cannot assure you that there will not be material weaknesses or significant deficiencies in our internal control over financial reporting in the future.
Any failure to maintain internal control over financial reporting could severely inhibit our ability to accurately report our financial condition or results of operations.
−Removed: If we are unable to conclude that our internal control over financial reporting is effective, investors may lose confidence in the
−Removed: accuracy and completeness of our financial reports and the market price of our common stock could decline.
+Added: If we are unable to conclude that our internal control over financial reporting is effective, investors may lose confidence in the accuracy and completeness of our financial reports and the market price of our common stock could decline.
We could become subject to investigations by the NYSE, the SEC or other regulatory authorities, which could require additional financial and management resources.
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Any such guidance will consist of forward-looking statements, subject to the risks and uncertainties described in this filing and in our other public filings and public statements.
−Removed: The ability to provide this public guidance, and the ability to accurately forecast our results of operations, may be impacted by the COVID-19 pandemic.
−Removed: Our actual results may not always be in line with or exceed any guidance we have provided, especially in times of economic uncertainty, such as the current global economic uncertainty being experienced as a result of the COVID-19 pandemic.
+Added: Our actual results may not always be in line with or exceed any guidance we have provided, especially in times of economic uncertainty, such as the current global economic uncertainty being experienced.
If, in the future, our operating or financial results for a particular period do not meet any guidance provided or the expectations of investment analysts, or if we reduce our guidance for future periods, the market price of our common stock may decline as well.
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fluctuations in commodity prices.
−Removed: We will incur significant increased expenses and administrative burdens as a public company, which could negatively impact our business, financial condition and results of operations.
−Removed: We face increased legal, accounting, administrative and other costs and expenses as a public company that we did not incur as a private company.
−Removed: Sarbanes-Oxley, including the requirements of Section 404, as well as rules and regulations subsequently implemented by the SEC, the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 and the rules and regulations promulgated and to be promulgated thereunder, the PCAOB and the securities exchanges, impose additional reporting and other obligations on public companies.
−Removed: Compliance with public company requirements will increase costs and make certain activities more time-consuming.
+Added: We will continue to incur significant increased expenses and administrative burdens as a public company, which could negatively impact our business, financial condition and results of operations.
+Added: We face increased legal, accounting, insurance, administrative and other costs and expenses as a public company that we did not incur as a private company.
+Added: Sarbanes-Oxley, including the requirements of Section 404, as well as rules and regulations subsequently implemented by the SEC, the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 and the rules and regulations promulgated and to be promulgated thereunder, the Public Company Accounting Oversight Board (“PCAOB”) and the securities exchanges, impose additional reporting and other obligations on public companies.
+Added: Compliance with public company requirements will continue to increase costs and make certain activities more time-consuming.
A number of those requirements require us to carry out activities we have not done previously.
−Removed: For example, we have created new board committees and adopted new internal controls and disclosure controls and procedures.
−Removed: If any issues in complying with SEC reporting requirements are identified (for example, if we identify an additional material weakness or significant deficiency or fail to remediate any existing material weaknesses in the internal control over financial reporting), we could incur additional costs rectifying those issues, and the existence of those issues could harm our reputation or investor perceptions of us.
+Added: For example, we adopted new internal controls and disclosure controls and procedures.
+Added: If any issues in complying with SEC reporting requirements are identified (for example, if we identify a material weakness or significant deficiency in the internal control over financial reporting), we could incur additional costs rectifying those issues, and the existence of those issues could harm our reputation or investor perceptions of us.
Further, the costs to maintain our director and officer liability insurance may continue to rise to unprecedented levels.
−Removed: Risks associated with our status as a public company may make it more difficult to attract and retain qualified persons to serve on our board of directors or as executive officers.
+Added: Risks associated with our status as a public company may make it more difficult to attract and retain qualified persons to serve on our Board or as executive officers.
The additional reporting and other obligations imposed by these rules and regulations will increase legal and financial compliance costs and the costs of related legal, accounting and administrative activities.
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(5) reduced disclosure obligations regarding executive compensation arrangements in periodic reports, registration statements, and proxy statements;
−Removed: and (6) exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.
+Added: (6) exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.
As a result, the information we provide will be different than the information that is available with respect to other public companies that are not emerging growth companies.
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Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements.
−Removed: We will remain a smaller reporting company until the last day of the fiscal year in which (i) the market value of common stock held by non-affiliates exceeds $250 million as of the end of that year’s second fiscal quarter, or (ii) our annual revenues exceeded $100 million during such completed fiscal year and the market value of common stock held by non-affiliates equals or exceeds $700 million as of the end of that year’s second fiscal quarter.
−Removed: To the extent we take advantage of such reduced disclosure obligations, we may also make comparison of our financial statements with other public companies difficult or impossible.
−Removed: A significant portion of our total outstanding shares of common stock are restricted from immediate resale but may be sold into the market in the near future.
−Removed: This could cause the market price of common stock to drop significantly, even if our business is doing well.
−Removed: Shares of our common stock that are currently restricted from immediate resale may be sold into the market in the near future.
−Removed: These sales, or the perception in the market that the holders of a large number of shares intend to sell shares, could reduce the market price of common stock.
−Removed: We are unable to predict the effect that sales may have on the prevailing market price of our common stock or our public warrants.
−Removed: To the extent our warrants, additional shares of common stock will be issued, which will result in dilution to the holders of common stock and increase the number of shares eligible for resale in the public market.
−Removed: Sales, or the potential sales, of substantial numbers of shares in the public market by the securityholders, subject to certain restrictions on transfer until the termination of applicable lock-up periods, could increase the volatility of the market price of common stock or adversely affect the market price of our common stock.
+Added: We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of common stock held by non-affiliates exceeds $250 million as of the end of that year’s second fiscal quarter, or (2) our annual revenues exceeded $100 million during such completed fiscal year and the market value of common stock held by non-affiliates equals or exceeds $700 million as of the end of that year’s second fiscal quarter.
+Added: To the extent we take advantage of such reduced disclosure obligations, this may also make comparison of our financial statements with other public companies difficult or impossible.
We may issue additional shares of common stock or other equity securities without your approval, which would dilute your ownership interests and may depress the market price of our common stock.
−Removed: We have warrants outstanding to purchase an aggregate of 13,534,220 shares of common stock.
+Added: As of December 31, 2022, we had warrants outstanding to purchase an aggregate of 13,532,688 shares of common stock.
Pursuant to our employee benefit plans, we may issue an aggregate of up to 28,769,625 shares of common stock, which amount may be subject to increase from time to time.
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There is no guarantee that the public warrants will be in the money prior to their expiration, and as such, the public warrants may expire worthless.
+Added: The public warrants expire on September 30, 2026.
We may amend the terms of the public warrants in a manner that may be adverse to holders with the approval by the holders of at least 50% of the then-outstanding public warrants.
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Our public warrants are issued in registered form under the Warrant Agreement between the warrant agent and us.
−Removed: The Warrant Agreement provides that the terms of the public warrants may be amended without the consent of any holder to cure any ambiguity or correct any defective provision, but requires the approval by the holders of at least 50% of the then-outstanding public warrants to make any change that adversely affects the interests of the registered holders of public warrants.
+Added: The Warrant Agreement provides that the terms of the public warrants may be amended without the
+Added: consent of any holder to cure any ambiguity or correct any defective provision, but requires the approval by the holders of at least 50% of the then-outstanding public warrants to make any change that adversely affects the interests of the registered holders of public warrants.
Accordingly, we may amend the terms of the public warrants in a manner adverse to a holder if holders of at least 50% of the then-outstanding public warrants approve of such amendment.
−Removed: Although our ability to amend the terms of the public warrants with the consent of
−Removed: at least 50% of the then- outstanding public warrants is unlimited, examples of such amendments could be amendments to, among other things, increase the exercise price of the warrants, convert the public warrants into cash or stock (at a ratio different than initially provided), shorten the exercise period or decrease the number of shares of our common stock purchasable upon exercise of a public warrant.
+Added: Although our ability to amend the terms of the public warrants with the consent of at least 50% of the then-outstanding public warrants is unlimited, examples of such amendments could be amendments to, among other things, increase the exercise price of the warrants, convert the public warrants into cash or stock (at a ratio different than initially provided), shorten the exercise period or decrease the number of shares of our common stock purchasable upon exercise of a public warrant.
We may redeem unexpired public warrants prior to their exercise at a time that is disadvantageous to warrantholders, thereby making such warrants worthless.
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If and when the public warrants become redeemable by us, we may exercise our redemption right even if we are unable to register or qualify the underlying securities for sale under all applicable state securities laws.
−Removed: Redemption of the outstanding public warrants could force you (a) to exercise your public warrants and pay the exercise price therefor at a time when it may be disadvantageous for you to do so, (b) to sell your public warrants at the then-current market price when you might otherwise wish to hold your public warrants or (c) to accept the nominal redemption price which, at the time the outstanding public warrants are called for redemption, is likely to be substantially less than the market value of your public warrants.
−Removed: In addition, we may redeem your public warrants after they become exercisable for a number of shares of common stock determined based on the redemption date and the fair market value of our common stock.
+Added: Redemption of the outstanding public warrants could force you (1) to exercise your public warrants and pay the exercise price therefor at a time when it may be disadvantageous for you to do so, (2) to sell your public warrants at the then-current market price when you might otherwise wish to hold your public warrants or (3) to accept the nominal redemption price which, at the time the outstanding public warrants are called for redemption, is likely to be substantially less than the market value of your public warrants.
+Added: In addition, we may redeem the public warrants after they become exercisable for a number of shares of common stock determined based on the redemption date and the fair market value of our common stock.
Any such redemption may have similar consequences to a cash redemption described above.
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We have no current plans to pay dividends on our common stock.
−Removed: Any future determination to pay dividends will be made at the discretion of our board of directors, subject to applicable laws.
−Removed: It will depend on a number of factors, including our financial condition, results of operations, capital requirements, contractual, legal, tax and regulatory restrictions, general business conditions, and other factors that the board of directors may deem relevant.
+Added: Any future determination to pay dividends will be made at the discretion of our Board, subject to applicable laws.
+Added: It will depend on a number of factors, including our financial condition, results of operations, capital requirements, contractual, legal, tax and regulatory restrictions, general business conditions, and other factors that the Board may deem relevant.
In addition, the ability to pay cash dividends may be restricted by the terms of debt financing arrangements, as any future debt financing arrangement likely will contain terms restricting or limiting the amount of dividends that may be declared or paid on our common stock.
−Removed: As a result, stockholders may not receive any return on an investment in our common stock unless they sell their shares for a price greater than that which they paid for them.
+Added: As a result, stockholders may not receive any return on an investment in our common stock unless they sell their shares for a price greater than what they paid for them.
Provisions in our organizational documents and certain rules imposed by regulatory authorities may delay or prevent an acquisition by a third party that could otherwise be in the interests of stockholders.
−Removed: Our second amended and restated certificate of incorporation (“Certificate of Incorporation”) and amended and restated bylaws (“Bylaws”) contain several provisions that may make it more difficult or expensive for a third party to acquire control of us without the approval of the board of directors.
+Added: Our second amended and restated certificate of incorporation (“Certificate of Incorporation”) and amended and restated bylaws (“Bylaws”) contain several provisions that may make it more difficult or expensive for a
+Added: third party to acquire control of us without the approval of the Board.
These provisions, which may delay, prevent or deter a merger, acquisition, tender offer, proxy contest, or other transaction that stockholders may consider favorable, include the following:
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the required approval of holders representing at least 66 2/3% of the total voting power of the shares entitled to vote at an election of the directors to remove directors;
−Removed: the ability of the board of directors to designate the terms of and issue new series of preferred stock without stockholder approval, which could be used, among other things, to institute a rights plan that would have the effect of significantly diluting the stock ownership of a potential hostile acquirer, likely preventing acquisitions.
+Added: the ability of the Board to designate the terms of and issue new series of preferred stock without stockholder approval, which could be used, among other things, to institute a rights plan that would have the effect of significantly diluting the stock ownership of a potential hostile acquirer, likely preventing acquisitions.
These provisions of our Certificate of Incorporation and Bylaws could discourage potential takeover attempts and reduce the price that investors might be willing to pay for shares of our common stock in the future, which could reduce the market price of our common stock.
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It further provides that, unless we consent in writing to the selection of an alternative forum, the federal district courts of the United States shall, to the fullest extent permitted by law, be the sole and exclusive forum for the resolutions of any complaint asserting a cause of action arising under the Securities Act.
−Removed: The exclusive forum clauses described above shall not apply to suits brought to enforce a duty or liability created by the Securities Exchange Act of 1934, or any other claim for which the federal courts have exclusive jurisdiction.
+Added: The exclusive forum clauses described above shall not apply to suits brought to enforce a duty or liability created by the Exchange Act, or any other claim for which the federal courts have exclusive
+Added: jurisdiction.
Although these provisions are expected to benefit us by providing increased consistency in the application of applicable law in the types of lawsuits to which they apply, the provisions may have the effect of discouraging lawsuits against directors and officers.
The enforceability of similar choice of forum provisions in other companies’ certificates of incorporation have been challenged in legal proceedings and there is uncertainty as to whether a court would enforce such provisions.
−Removed: In addition, investors cannot waive compliance with the federal securities laws and the
−Removed: rules and regulations thereunder.
+Added: In addition, investors cannot waive compliance with the federal securities laws and the rules and regulations thereunder.
It is possible that, in connection with any applicable action brought against us, a court could find the choice of forum provisions contained in our Certificate of Incorporation to be inapplicable or unenforceable in such action.
3 unchanged sentences
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.