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Additional risks and uncertainties not presently known to us or that we currently believe to be immaterial may also adversely affect our business.
−Removed: Summary Risk Factors
+Added: Summary of Risk Factors
Our business is subject to a number of risks of which you should be aware before making a decision to invest in our securities.
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If we cannot successfully overcome those barriers, our business will be negatively impacted and could fail.
−Removed: • We have experienced in the past, and could also suffer future disruptions, outages, defects and other performance and quality problems with our quantum computing systems, our private cloud, or other information systems, our research and development activities, our facilities, our other fixed assets, or with the public cloud, internet, and other infrastructure on which they rely.
−Removed: • 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.
−Removed: • We may be negatively impacted by any early obsolescence of our quantum computing technology.
+Added: • We have experienced in the past, and could also suffer in the future, disruptions, outages, defects and other performance and quality problems with our quantum computing systems, our private cloud, or other information systems, our research and development activities, our facilities, our other fixed assets, or with the public cloud, internet, and other infrastructure on which they rely.
+Added: • Even if we are successful in developing quantum technologies and executing our strategy, competitors in the industry may achieve technological breakthroughs that render our quantum computing systems obsolete or inferior to other products.
+Added: • We may be negatively impacted by any early obsolescence of our quantum technologies.
• If our computers fail to achieve a broad quantum advantage, our business, financial condition and future prospects may be harmed.
• The quantum computing and networking 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: • The quantum computing and networking industry is in its early stages and volatile, and if it does not develop, if it develops slower than we expect, if it develops in a manner that does not require use of our quantum computing solutions, if it encounters negative publicity or if our solution does not drive commercial engagement, the growth of our business will be harmed.
−Removed: • 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.
+Added: • The quantum computing and networking industry is in its early stages and volatile, and if it does not develop, if it develops slower than we expect, if it develops in a manner that does not require use of our quantum computing solutions, if it encounters negative publicity or if our solutions do not drive commercial engagement, the growth of our business will be harmed.
+Added: • We may not be able to accurately estimate the future supply and demand for our quantum solutions, which could result in a variety of inefficiencies in our business and hinder our ability to generate revenue.
If we fail to accurately predict our manufacturing requirements, we could incur additional costs or experience delays.
−Removed: • Our systems depend on the use of a particular isotope of an atomic element that provides qubits for our ion trap technology.
−Removed: If we are unable to procure these isotopically enriched atomic samples, or are unable to do so on a timely and
−Removed: cost-effective basis, and in sufficient quantities, we may incur significant costs or delays, which could negatively affect our operations and business.
• 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.
−Removed: • Our business depends on our customers’ abilities to implement useful quantum algorithms and sufficient quantum resources for their business.
+Added: • Acquisitions, including the SkyWater Acquisition, and other strategic transactions involve a number of inherent risks, any of which could result in the benefits anticipated not being realized.
+Added: • Our business depends on our customers’ ability to implement useful quantum algorithms and sufficient quantum resources for their business.
If they are unable to do so, including due to their algorithmic challenge or other technical or personnel dilemmas, our growth may be negatively impacted.
+Added: • We are highly dependent on our key employees who have specialized knowledge, and our ability to attract and retain senior management and other key employees is critical to our success, and we have recently experienced significant turnover in our top management, which could adversely affect our business.
• Much of our revenue is concentrated in a few customers, and if we lose any of these customers through contract terminations, acquisitions, or other means, our revenue may decrease substantially.
• Our future growth and success depends in part on our ability to sell effectively to government entities and large enterprises.
−Removed: • Contracts with domestic and international government and state agencies are subject to a number of challenges and risks.
+Added: • Contracts with U.S.
+Added: federal and state and international government and state agencies are subject to a number of challenges and risks.
• If our information technology systems, data, or physical facilities, or those of third parties upon which we rely, are or were compromised, we could experience adverse business consequences resulting from such compromise.
• 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: • Our business is exposed to risks associated with litigation, investigations and regulatory proceedings.
• Contracts with government entities subject us to risks, including early termination, audits, investigations, sanctions and penalties.
+Added: • Our satellite operations depend on regulatory approvals, and any delays, denials, or changes in policy could harm our business, operations and financial results.
• 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.
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• 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.
−Removed: • 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 covered by 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.
−Removed: manufacturers.
• If our operating and financial performance in any given period does not meet the guidance provided to the public or the expectations of investment analysts, the market price of our common stock may decline.
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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.
−Removed: Our ability to generate revenues will largely be dependent on our ability to develop and produce quantum computers with increasing numbers of algorithmic qubits and to connect those quantum computers via quantum networks.
−Removed: As a result, our scalable business model has not been formed and it is possible that neither our December 2020 forward-looking technical roadmap nor our latest technical roadmap will be realized as quickly as expected, 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,
−Removed: scalable computers are produced, which requires a number of technological advancements that may not occur on the currently anticipated timetable or at all.
+Added: Our scalable business model has not been formed and it is possible that our latest technical roadmap will 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 substantially more costs than incurred to date.
As a result, our historical results should not be considered indicative of our future performance.
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As of December 31, 2025, we had an accumulated deficit of $1,194.1 million.
−Removed: 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.
−Removed: Even with significant production, such production may never become profitable.
−Removed: We expect to continue to incur operating losses for the near future 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.
+Added: We believe that we will continue to incur losses in the near future, and we may never become profitable.
+Added: We expect to continue to incur operating losses for the near future as we, among other things, continue to incur significant expenses in connection with the design, development and construction of our quantum computers and other products, and as we expand our research and development activities, invest in manufacturing capabilities, build up inventories of components for our products, increase our sales and marketing activities, develop our distribution infrastructure, invest in expanding our quantum platform and developing a worldwide quantum ecosystem and increase our general and administrative functions to support our growing operations.
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.
−Removed: If we are unable to achieve and/or sustain profitability, or if we are unable to achieve the growth that we expect from these investments, it could have a material adverse effect on our business, financial condition or results of operations.
+Added: Further, we have recently acquired companies, or entered into agreements to acquire companies, that have operating losses, which could result in additional losses, and our expected integration related expenses for those acquired companies could increase our losses.
+Added: An inability to achieve and sustain profitability, or to achieve the growth that we expect from these investments, could have a material adverse effect on our business, financial condition or results of operations.
Our business model is unproven and may never allow us to cover our costs.
We may not be able to scale our business quickly enough to meet customer and market demand, which could adversely affect our financial condition and results of operations or cause us to fail to execute on our business strategies.
−Removed: In order to grow our business, we will need to continually evolve and scale our business and operations to meet customer and market demand.
−Removed: Quantum computing technology has never been sold at large-scale commercial levels.
+Added: To grow our business, we will need to continually evolve and scale our business and operations to meet customer and market demand.
+Added: Quantum technology has never been sold at large-scale commercial levels.
Evolving and scaling our business and operations places increased demands on our management as well as our financial and operational resources to:
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• design scalable processes;
−Removed: • accelerate and/or refocus research and development activities;
−Removed: • expand manufacturing, supply chain and distribution capacity;
+Added: • accelerate and refocus research and development activities;
+Added: • expand manufacturing, supply chain and distribution capacity, including foundry capacity;
• increase sales and marketing efforts;
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• maintain effective financial disclosure controls and procedures.
−Removed: Commercial production of quantum computers or networks may never occur.
−Removed: We have no experience in producing large quantities of our products and are currently constructing advanced generations of our products.
+Added: Large-scale commercial production of quantum computers and other quantum products may never occur.
+Added: We have no experience in producing large quantities of certain of our products and are currently constructing advanced generations of our products.
As noted above, there are significant technological and logistical challenges associated with developing, producing, marketing, selling and distributing products in the advanced technology industry, including our products, and we may not be able to resolve all of the difficulties that may arise in a timely or cost-effective manner, or at all.
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The stability of ion traps may prove poorer than hoped, or more difficult to manufacture.
−Removed: It may also prove more difficult or even impossible to reliably entangle/connect ion traps together.
+Added: It may also prove more difficult or even impossible to reliably entangle or otherwise connect ion traps together.
Both of these factors would adversely impact scalability and costs of the ion trap system.
−Removed: If commercial production of our quantum computers and networks commences, our products may contain defects in design and manufacture that may cause them to not perform as expected or that may require repair, recalls and design changes.
−Removed: Our quantum computers are inherently complex and incorporate technology and components that have not been used for other applications and that may contain defects and errors, particularly when first introduced.
+Added: If large-scale commercial production of our quantum computers and other quantum products commences, they may contain defects in design and manufacturing that cause them not to perform as expected or to require repair, recalls and design changes.
+Added: Our quantum computers and other quantum products incorporate technology and components that have not been used for other applications and that may contain defects and errors, particularly when first introduced.
We have a limited frame of reference from which to evaluate the long-term performance of our products.
−Removed: There can be no assurance that we will be able to detect and fix any defects in our quantum computers or networks prior to the sale to potential customers.
+Added: There can be no assurance that we will be able to detect and fix any defects in our quantum computers and other quantum products before the sale to customers.
If our products fail to perform as expected, customers may delay deliveries, terminate further orders or initiate product recalls, each of which could adversely affect our sales and brand and could adversely affect our business, prospects and results of operations.
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We may not manage our growth effectively.
−Removed: If we fail to manage growth effectively, our business, results of operations and financial condition could be harmed.
+Added: If we fail to manage growth effectively, we may not be able to meet the benchmarks in our latest technical roadmap, and our business, results of operations and financial condition could be harmed.
We anticipate that a period of significant expansion will be required to address potential growth.
This expansion will place a significant strain on our management, operational and financial resources.
+Added: We have recently acquired companies, or entered into agreements to acquire companies, that could place additional strain on our management, operational and financial resources.
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.
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.
+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, legal, administrative and operations staff.
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 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 have and we may be required to continue to expand our employee base and hire additional employees to support our operations as a public company, which will continue to increase our operating costs in future periods.
Our estimates of market opportunity and forecasts of market growth may prove to be inaccurate.
−Removed: Market opportunity estimates and growth forecasts, including those we have generated, are subject to significant uncertainty and are based on assumptions and estimates that may not prove to be accurate.
+Added: Market opportunity estimates, growth forecasts, and data analytics, including those we have generated, are subject to significant uncertainty and are based on assumptions and estimates that may not prove to be accurate.
The variables that go into the calculation of our market opportunity are subject to change over time, and there is no guarantee that any particular number or percentage of companies covered by our market opportunity estimates will purchase our products at all or generate any particular level of revenue for us.
−Removed: In addition, alternatives to quantum computing may present themselves, which could substantially reduce the market for quantum computing services.
−Removed: 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 the total addressable market.
−Removed: 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 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.
+Added: In addition, alternatives to quantum solutions may present themselves, which could substantially reduce the market for our quantum products and services.
+Added: Any expansion in our market depends on a number of factors, including the cost, performance, and perceived value associated with quantum solutions.
+Added: The methodology, assumptions, and data analytics used to estimate industry size market opportunities and analyze the quantum industry may differ materially from the methodologies, assumptions, and analyses previously used to estimate the total addressable market.
+Added: To estimate the size of our market opportunities and our growth rates, as well as to forecast the size of the quantum industry and analyze the quantum industry more broadly, we have relied on market reports by leading research and consulting firms.
+Added: These estimates of the total addressable market, growth forecasts, and industry 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.
This could adversely affect the timing of any quantum advantage being achieved, if at all.
−Removed: Even if the market in which we compete achieves the forecasted growth, our business could fail to grow at similar rates, if at all.
+Added: Even if the markets in which we compete achieve the forecasted growth, our business could fail to grow at similar rates, if at all.
Our success will depend upon our ability to expand, scale our operations and increase our sales capability.
−Removed: 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.
+Added: Even if the markets in which we compete meet the size estimates and growth forecasted, our business could fail to grow at similar rates, if at all.
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.
−Removed: Our growth is also dependent upon our ability to successfully market and sell quantum computing and networking technology.
−Removed: We do not have experience with the mass distribution and sale of quantum computing and networking technology.
+Added: Our growth is also dependent upon our ability to successfully market and sell quantum technologies.
+Added: We do not have experience with the mass distribution and sale of quantum technologies.
Our growth and long-term success will depend upon the development of our sales and delivery capabilities.
−Removed: Unforeseen issues associated with scaling up and constructing quantum computing and networking 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.
−Removed: 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: Unforeseen issues associated with scaling up, constructing and selling quantum technologies at commercially viable levels could negatively impact our business, financial condition and results of operations.
+Added: Moreover, because of our unique technologies, 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 technologies, it could overburden our servicing and support capabilities.
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.
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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.
−Removed: Failure to grow at rates similar to that of the quantum computing and networking industry may adversely affect our operating results and ability to effectively compete within the industry.
+Added: Failure to grow at rates similar to that of the quantum industry may adversely affect our operating results and ability to effectively compete within the industry.
Our operating and financial results forecast relies in large part upon assumptions and analyses we have developed.
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• success and timing of development activity;
−Removed: • customer acceptance of our quantum computing and networking systems;
−Removed: • breakthroughs in classical computing or other computing technologies that could eliminate the advantages of quantum computing and networking systems rendering them less practical to customers;
+Added: • customer acceptance of our quantum products and systems;
+Added: • breakthroughs in classical technologies that could eliminate the advantages of quantum systems by rendering them less practical to customers;
• competition, including from established and future competitors;
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Such financings may result in dilution to our stockholders, issuance of securities with priority as to liquidation and dividend and other rights more favorable than common stock, imposition of debt covenants and repayment obligations or other restrictions that may adversely affect our business.
−Removed: In addition, we may seek additional capital due to favorable market conditions or
−Removed: strategic considerations even if we believe that we have sufficient funds for current or future operating plans.
+Added: 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.
Weakness and volatility in capital markets and the economy, in general or as a result of bank failures or macroeconomic conditions such as high 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.
−Removed: The inability to obtain financing when needed may make it more difficult for us to operate our business or implement our growth plans.
+Added: The inability to obtain financing when needed could make it more difficult for us to operate our business or implement our growth plans.
Our ability to use net operating loss carryforwards and other tax attributes may be limited.
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As of December 31, 2025, we had U.S.
−Removed: federal and state net operating loss carryforwards of approximately $224.2 million and $148.1 million, respectively.
−Removed: Our net operating loss carryforwards and other tax attributes are subject to review and possible adjustment by the Internal Revenue Service, and state tax authorities.
−Removed: Under Sections 382 and 383 of the Internal Revenue Code of 1986, as amended (the “Code”), our U.S.
+Added: federal, state, and foreign net operating loss
+Added: carryforwards of approximately $653.8 million, $454.7 million, and $140.6 million, respectively.
+Added: Additionally, we continue to generate business tax credits, including the U.S.
+Added: federal research and development credit, which generally may be carried forward for 20 years from the year of generation to offset a portion of our future tax liability, if any.
+Added: There is a risk that our ability to use net operating loss and tax credit carryforwards may be limited due to local tax law restrictions, changes in tax regulations, or insufficient future taxable income in the relevant jurisdictions.
+Added: federal and state net operating loss carryforwards and other tax attributes are subject to review and possible adjustment by the Internal Revenue Service, and state tax authorities.
+Added: Under Sections 382 and 383 of the Internal Revenue Code of 1986, as amended, which we refer to as the Code, our U.S.
federal net operating loss carryforwards and other tax attributes may become subject to an annual limitation in the event of certain cumulative changes in the ownership of our stock.
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 or other transactions.
+Added: Our ability to use 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, such as issuances of our stock as consideration to acquire other companies.
+Added: Additionally, the utilization of pre-acquisition net operating loss carryforwards and other tax attributes of subsidiaries we acquired may be limited under Sections 382 and 383 of the Internal Revenue if the acquired subsidiary underwent an ownership change, including in connection with the applicable acquisition transaction, whether or not we have undergone an ownership change.
Similar rules may apply under state tax laws.
−Removed: We have not yet determined the amount of the cumulative change in our ownership resulting from our Business Combination with dMY or other transactions, or any resulting limitations on our ability to utilize our net operating loss carryforwards and other tax attributes.
+Added: We have not yet determined whether any of the transactions that we have entered into since our establishment has resulted in an “ownership change” under Section 382 of the Code, and therefore whether we have experienced any resulting limitations on our ability to utilize our net operating loss carryforwards and other tax attributes.
If we earn taxable income, such limitations could result in increased future income tax liability and our future cash flows could be adversely affected.
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• it could prove more challenging and take materially longer than expected to operate gates within a single ion trap with higher throughput while maintaining gate fidelity;
−Removed: • 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 optimize the total number of qubits within one trap;
• the gate speed in our technology could prove more difficult to improve than expected;
−Removed: • the Reconfigurable Multi-Core Quantum Architecture (RMQA) could prove to be more challenging to develop than expected.
−Removed: This would limit our ability to scale ion traps beyond single-core operation;
−Removed: • the photonic interconnect technology used to connect ion traps could prove more challenging and take longer to perfect than currently expected.
−Removed: This would limit our ability to scale to a sufficiently large number of qubits in a single system or network systems together;
+Added: • the ion transport technology used to shuttle and reconfigure the qubits within a trap or QPU could prove more challenging to develop, operate and scale than anticipated, resulting in reduced gate performance or throughput;
+Added: • the photonic interconnect technology used to connect ion traps could prove more challenging and take longer to perfect than currently expected, which would limit our ability to scale to a sufficiently large number of qubits in a single system or network systems together;
+Added: • the integration of quantum memories into our photonic interconnects could prove more challenging, costly or time-consuming than expected, resulting in a reduced interconnect system performance;
• it could take longer to incorporate modular architectures for additional cross-processor computational strength than currently expected, limiting our ability to realize the benefits of multicore technology;
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In addition, we will need to develop the manufacturing process necessary to make these quantum computers in high volume.
−Removed: We have not yet validated a manufacturing process nor acquired the tools, processes, or support functions necessary to produce high volumes of our quantum computers that meet all commercial requirements.
−Removed: If we are not able to overcome these manufacturing hurdles in building our quantum computers, our business is likely to fail.
+Added: We have not yet validated a manufacturing process or acquired the tools, processes or support functions necessary to produce high volumes of our quantum computers that meet all commercial requirements.
+Added: If we are not able to overcome these manufacturing hurdles in building our quantum computers, our business could fail.
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: We have experienced in the past, and could also suffer future disruptions, outages, defects and other performance and quality problems with our quantum computing systems, our private cloud, or other information systems, our research and development activities, our facilities, our other fixed assets, or with the public cloud, internet, and other infrastructure on which they rely.
−Removed: Our business depends on our quantum computing systems to be available.
+Added: We have experienced in the past, and could also suffer in the future, disruptions, outages, defects and other performance and quality problems with our systems, including our information technology systems, our research and development activities, our facilities, our other fixed assets or with the public cloud, internet and other infrastructure on which they rely.
We have experienced, and may in the future further experience, disruptions, outages, defects and other performance and quality problems with our systems.
We have also experienced, and may in the future further experience, disruptions, outages, defects and other performance and quality problems with the public cloud, internet, private data center providers, facilities in which we build and deploy our systems and technology and other infrastructure like utility power, water supply, air conditioning, air compression and other inputs on which our systems and their supporting services rely.
+Added: For example, in February 2025, an overheating incident in one of our manufacturing rooms affected laboratory cleanliness and system components, necessitating cleaning and repair, as well as movement of components and systems, causing some disruptions and delays in availability of our systems.
These problems can be caused by a variety of factors, including software or firmware updates, vulnerabilities and defects in proprietary software and open-source software, hardware components, human error or misconduct, capacity constraints, design limitations, denial of service attacks or other security-related incidents, foreign objects or debris, weather, construction, supply chain events or accidents and other force majeure.
We do not have a contractual right with our public cloud providers that compensates us for any losses due to availability interruptions in the public cloud.
−Removed: Any disruptions, outages, defects and other performance and quality problems with our quantum computing systems or with the public cloud, internet, and other information systems and infrastructure on which they rely, could result in reduced use of our systems, increased expenses, delayed delivery under our contractual commitments, required provision of service credits, 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 that render our quantum computing systems obsolete or inferior to other products.
−Removed: Our continued growth and success depend on our ability to innovate and develop quantum computing and networking technology in a timely manner and effectively market these products.
−Removed: 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: In addition to our quantum products and services, our satellites operate in the harsh environment of space, which subjects them to operational risks such as exposure to space debris and other spacecraft while in orbit.
+Added: Further, our satellite network is subject to a number of other potential disruptions, including those caused by hardware failures, software bugs, satellite malfunctions, ground station outages and power failures.
+Added: A technical failure could also result from a third-party launch or deployer failure, a technical failure of the satellite itself or conditions in space.
+Added: A company that we acquired experienced satellite failures prior to its acquisition by us, including the loss of a satellite at launch in the third quarter of 2023, and may experience additional failures in the future.
+Added: The loss of multiple satellites due to systemic design flaws, manufacturing defects or catastrophic events could significantly impair our imaging capacity, delay our service deployment, breach customer commitments and harm our business, operations and financial results.
+Added: Further, we have recently acquired a number of businesses, each with its own information technology systems.
+Added: As we continue to grow and mature, we make efforts to integrate these businesses’ systems into our existing systems, and from time to time we evaluate opportunities to modernize our systems, including the potential for upgrading our enterprise resource planning platforms.
+Added: There are inherent costs and risks associated with upgrading and implementing changes to any one of these systems, including potential disruption of our operations and internal control structure, greater than budgeted capital expenditures or administration and operating expenses, demands on management time, securing our systems along with dependent processes from cybersecurity threats and other costs and risks, and the changes may or may not result in the anticipated benefits.
+Added: The implementation of or delay in implementing new information technology systems may also cause disruptions in our business operations and impede our ability to comply with constantly evolving laws, regulations and industry standards addressing information and technology networks, privacy and data security, any of which could have a material adverse effect on our business, financial condition, results of operations and cash flow.
+Added: Any disruptions, outages, defects and other performance and quality problems with our fixed assets or with the public cloud, internet and other information systems and infrastructure on which they rely, could result in reduced use of our systems, increased expenses, delayed delivery under our contractual commitments, required provision of service credits 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.
+Added: Even if we are successful in developing quantum technologies and executing our strategy, competitors in the industry may achieve technological breakthroughs that render our quantum systems obsolete or inferior to other products.
+Added: Our continued growth and success depend on our ability to innovate and develop quantum technologies in a timely manner and effectively market these products.
+Added: Without timely innovation and development, our quantum solutions could be rendered obsolete or less competitive by changing customer preferences or because of the introduction of a competitor’s newer technologies.
+Added: We believe that many competing technologies will require a technological breakthrough in one or more problems related to science, fundamental
+Added: 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.
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.
−Removed: We may be negatively impacted by any early obsolescence of our quantum computing technology.
−Removed: We depreciate the cost of our quantum computing systems over their expected useful lives.
−Removed: However, product cycles or quantum computing systems may change periodically due to changes in innovation in the industry, and we may decide to update our products or production processes more quickly than expected, resulting in obsolescence of all or part of our quantum computing systems prior to the end of the previously expected useful life.
+Added: We may be negatively impacted by any early obsolescence of our quantum technologies.
+Added: We depreciate the cost of our quantum systems over their expected useful lives.
+Added: However, product cycles or quantum systems may change periodically due to changes in innovation in the industry, and we may decide to update our products or production processes more quickly than expected, resulting in obsolescence of all or part of our quantum systems prior to the end of the previously expected useful life.
Moreover, we may need to alter the way in which we deliver our products due to changes in engineering and production expertise and efficiency.
−Removed: 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: Programming for quantum computing requires unique tools, software, hardware, and development environments.
−Removed: We have focused our efforts on creating quantum computing hardware, the system control platform for such hardware and a suite of low-level software programs that optimize execution of quantum algorithms on our hardware.
−Removed: Further up the stack, we rely on third parties to create and advance software, standards, specifications, applications, hardware and services that enable these systems to integrate into
−Removed: various environments and be utilized towards various customer use cases.
−Removed: Full utilization of our quantum computing solutions may depend on these third-party software, standards, specifications, applications, hardware and services, which may not be compatible with our quantum computing solutions and their development, or may not be available to us or our customers on commercially reasonable terms, or at all, which could harm our business.
+Added: If our quantum systems are not compatible with some or all industry-standard software and hardware in the future, our business could be harmed.
+Added: Programming for quantum technologies requires unique tools, software, hardware and development environments.
+Added: We have focused our efforts on creating quantum hardware, the system control platform for such hardware and a suite of low-level software programs that optimize execution of quantum algorithms on our hardware.
+Added: Further up the stack, we rely on third parties to create and advance software, standards, specifications, applications, hardware and services that enable these systems to integrate into various environments and be used towards various customer use cases.
+Added: Full use of our quantum solutions may depend on these third-party software, standards, specifications, applications, hardware and services, which may not be compatible with our quantum computing solutions and their development, or may not be available to us or our customers on commercially reasonable terms, or at all, which could harm our business.
+Added: Our efforts to ensure wide compatibility with other quantum technologies and supporting infrastructure, now existing or developed in the future, could be less successful than expected.
If our customers are unable to achieve compatibility between other software and hardware and our hardware, it could impact our relationships with such customers or with customers, generally, if the incompatibility is more widespread.
In addition, the mere announcement of an incompatibility problem relating to our products with higher level software tools could cause us to suffer reputational harm and/or lead to a loss of customers.
−Removed: Any adverse impacts from the incompatibility of our quantum computing solutions could adversely affect our business, operating results and financial condition.
−Removed: We may be unable to reduce the cost per qubit sufficiently, which may prevent us from pricing our quantum systems competitively.
−Removed: Our projections are dependent on the cost per qubit decreasing over the next several years as our quantum computers advance.
+Added: Any adverse impacts from the incompatibility of our quantum solutions could adversely affect our business, operating results and financial condition.
+Added: We may be unable to reduce our cost per qubit sufficiently, which may prevent us from pricing our quantum systems competitively.
+Added: Our projections, as well as our ability to meet the benchmarks in our latest technical roadmap, are dependent on our cost per qubit decreasing over the next several years as our quantum computers advance.
These cost projections are based on economies of scale due to demand for our computer systems, technological innovation and negotiations with third-party parts suppliers.
−Removed: If these cost savings do not materialize, the cost per qubit may be higher than projected, making our quantum computing solution less competitive than those produced by our competitors, which could have a material adverse effect on our business, financial condition or results of operations.
+Added: If these cost savings do not materialize, our cost per qubit may be higher than projected, making our quantum solutions less competitive than those produced by our competitors, which could have a material adverse effect on our business, financial condition or results of operations.
If our computers fail to achieve a broad quantum advantage, our business, financial condition and future prospects may be harmed.
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There are no assurances that we will be able to commercialize quantum computers from our relationships with cloud providers.
−Removed: We currently offer our QCaaS on public clouds provided by AWS’s Amazon Braket, Microsoft’s Azure Quantum, and the Google Cloud Marketplace.
+Added: We currently offer our QCaaS on public clouds provided by AWS’s 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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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.
−Removed: The quantum computing and networking 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.
+Added: The quantum 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.
The markets in which we operate are rapidly evolving and highly competitive.
−Removed: As these markets continue to mature and new technologies and competitors enter such markets, we expect competition to intensify.
+Added: As these markets continue to mature and new technologies and competitors enter, we expect competition to intensify.
Our current competitors include (among others):
−Removed: • large, well-established tech companies that generally compete in all of our markets, including Amazon, Google, IBM, Intel, and Microsoft;
+Added: • large, well-established technology companies that generally compete in all of our markets, including Amazon, Google, IBM, Intel and Microsoft;
• countries such as China, Russia, Australia, Canada, the United Kingdom and certain countries in the European Union;
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Many of our competitors have substantially greater brand recognition, customer relationships and financial, technical and other resources, including an experienced sales force and sophisticated supply chain management.
−Removed: They may be able to respond more effectively than us to new or changing opportunities, technologies, standards, customer requirements and buying practices or to cross-subsidize their quantum offerings from their other higher margin operations.
−Removed: In addition, many countries are focused on developing quantum solutions either in the private or public sector and may subsidize quantum computers or quantum networks, which may make it difficult for us to compete.
+Added: They may be able to respond more effectively than we do to new or changing opportunities, technologies, standards, customer requirements and buying practices or to cross-subsidize their quantum offerings from their other higher margin operations.
+Added: In addition, many countries and supranational organizations are focused on developing quantum solutions either in the private or public sector and may subsidize quantum technologies, or restrict participation in initiatives to develop quantum technologies in their own country or member states, which may make it difficult for us to compete.
Many of these competitors do not face the same challenges we do in growing our business.
In addition, other competitors might be able to compete with us by bundling their other products in a way that does not allow us to offer a competitive solution.
−Removed: Additionally, we must be able to achieve our objectives in a timely manner or quantum computing and networking may lose ground to competitors, including competing technologies.
−Removed: Because there are a large number of market participants, including certain sovereign nations, focused on developing quantum computing and networking technology, we must dedicate significant resources to achieving any technical objectives on the timelines established by our management team.
+Added: Additionally, we must be able to achieve our objectives in a timely manner or quantum solutions may lose ground to competitors, including competing technologies.
+Added: Because there are a large number of market participants, including certain sovereign nations, focused on developing quantum technologies, we must dedicate significant resources to achieving any technical objectives on the timelines established by our management team.
Any failure to achieve objectives in a timely manner could adversely affect our business, operating results and financial condition.
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: The quantum computing and networking industry is in its early stages and volatile, and if it does not develop, if it develops slower than we expect, if it develops in a manner that does not require use of our quantum computing solutions, if it encounters negative publicity or if our solution does not drive commercial engagement, the growth of our business will be harmed.
−Removed: The nascent market for quantum computers and networks is still rapidly evolving, characterized by rapidly changing technologies, competitive pricing and competitive factors, evolving government regulation and industry standards, and changing customer demands and behaviors.
−Removed: If the market for quantum computers and networks in general does not develop as expected, or develops more slowly than expected, our business, prospects, financial condition and operating results could be harmed.
−Removed: In addition, our growth and future demand for our products is highly dependent upon the adoption of quantum computers and networks and commercially useful quantum algorithms to run on quantum computers by developers and customers, as well as on our ability to demonstrate the value of quantum computing to our customers.
−Removed: Delays in future generations of our quantum computers or technical failures at other quantum computing and networking companies could limit market acceptance of our solution.
−Removed: Negative publicity concerning our solution or the quantum computing and networking industry as a whole could limit market acceptance of our solution.
−Removed: We believe quantum computing will solve many large-scale problems.
−Removed: However, such problems may never be solvable by quantum computing technology, or may only be solvable by systems that are more technologically mature than we currently expect.
−Removed: If our clients and partners do not perceive the benefits of our solution, or if our solution does not drive customer engagement, then our market may not develop at all, or it may develop slower than we expect.
+Added: The quantum industry is in its early stages and volatile, and if it does not develop, if it develops slower than we expect, if it develops in a manner that does not require use of our quantum solutions, if it encounters negative publicity or if our solutions do not drive commercial engagement, the growth of our business will be harmed.
+Added: The nascent market for quantum solutions is still rapidly evolving, characterized by rapidly changing technologies, competitive pricing and competitive factors, evolving government regulation and industry standards and changing customer demands and
+Added: If the market for quantum solutions in general does not develop as expected, or develops more slowly than expected, our business, prospects, financial condition and operating results could be harmed.
+Added: In addition, our growth and future demand for our products is highly dependent upon the adoption of quantum technologies by developers and customers, as well as on our ability to demonstrate the value of quantum solutions to our customers.
+Added: Delays in future generations of our quantum solutions or technical failures at other quantum companies could limit market acceptance of our solutions.
+Added: Negative publicity concerning our solutions or the quantum industry as a whole could limit market acceptance of our solutions.
+Added: We believe quantum technologies will solve many large-scale problems.
+Added: However, such problems may never be solvable by quantum technologies, or may only be solvable by systems that are more technologically mature than we currently expect.
+Added: If our clients and partners do not perceive the benefits of our solutions, or if our solutions do not drive customer engagement, then our market may not develop at all, or it may develop slower than we expect.
If any of these events occur, it could have a material adverse effect on our business, financial condition or results of operations.
If progress towards quantum advantage ever slows relative to expectations, it could adversely impact revenues and customer confidence to continue to pay for testing, access and “quantum readiness.” This would adversely affect revenues in the period before quantum advantage.
−Removed: 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.
−Removed: We are reliant on third-party suppliers, including sole source suppliers, for components necessary to develop and manufacture our quantum computing and networking solutions.
+Added: We have and may continue to face supply chain issues that could delay the introduction of our products and negatively impact our business and operating results.
+Added: We are reliant on third-party suppliers, including sole source suppliers, for components necessary to develop and manufacture our quantum solutions.
As our business grows, we must continue to scale and adapt our supply chain or it could have an adverse impact on our business.
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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 global chip shortage, geopolitical tensions in and around Ukraine, Israel and other areas of the world and any indirect effects thereof;
+Added: • any reductions or interruption in supply, including disruptions on our global supply chain as a result of the global chip shortage, geopolitical tensions in and around Ukraine, Israel, Taiwan and other areas of the world and any indirect effects thereof;
• financial problems of either manufacturers or component suppliers;
−Removed: • intentional sabotage by a malicious actor or actors;
+Added: • intentional sabotage by malicious actors;
• significantly increased raw material costs and other expenses associated with our business;
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• significantly increased freight charges, disruptions in shipping or reduced availability of freight transportation;
−Removed: • imposition of, or increase in, tariffs, trade protection measures, or import and export controls by the United States or other countries;
+Added: • the imposition of, or a sustained or temporary increase in, tariffs, trade protection measures or import and export controls by the United States or other countries;
+Added: • actions taken by suppliers or other parties in response to expected or threatened increases in tariffs, trade protection measures or import or export controls by the United States or other countries;
+Added: • requirements under securities laws to determine, disclose and report whether our products contain conflict minerals and, if applicable, potential changes to products, processes or sources of supply as a consequence of such verification activities;
• reduced access to raw materials due to suppliers entering into exclusivity arrangements with our competitors;
−Removed: • 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;
+Added: • rising prices for or limited availability of satellite launch services;
+Added: • other factors beyond our control or that we do not presently anticipate that could affect our suppliers’ ability to deliver components to us on a timely basis;
+Added: • risks associated with essential components and materials that are available from a limited number of sources;
• a failure to develop our supply chain management capabilities and recruit and retain qualified professionals;
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We have experienced supply chain issues in the past.
−Removed: If any of the aforementioned factors were to materialize, it could cause us to delay or halt production of our quantum computing and networking 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.
−Removed: 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.
+Added: If any of the aforementioned factors were to materialize, it could cause us to delay or halt production of our quantum solutions and 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 may not be able to accurately estimate the future supply and demand for our quantum solutions, which could result in a variety of inefficiencies in our business and hinder our ability to generate revenue.
If we fail to accurately predict our manufacturing requirements, we could incur additional costs or experience delays.
It is difficult to predict our future revenues and appropriately budget for our expenses, and we may have limited insight into trends that may emerge and affect our business.
−Removed: From time to time we have been required to provide, and we anticipate being required to provide more consistently in the future, forecasts of our demand to our current and future suppliers prior to the scheduled delivery of products to potential customers.
−Removed: Currently, there is very little historical basis for making judgments on the demand for our quantum computers or our ability to design, develop, manufacture, and deliver quantum computers, or our profitability, if any, in the future.
+Added: From time to time we have been required to provide, and we anticipate being required to provide more consistently in the future, forecasts of our demand to our current and future suppliers before the scheduled delivery of products to potential customers.
+Added: Currently, there is very little historical basis for making judgments on the demand for, or our ability to design, develop, manufacture and deliver, quantum solutions, 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.
1 unchanged sentence
In addition, lead times for materials and components that our suppliers order may vary significantly and depend on factors such as the specific supplier, contract terms and demand for each component at a given time.
−Removed: If we fail to order sufficient quantities of product components in a timely manner, the delivery of quantum computers and related compute time to our potential customers could be delayed.
−Removed: We have previously failed, and may in the future fail, to accurately forecast customer demand, which resulted in, and may in the future result in, an excess or obsolescence of materials and supplies.
+Added: If we fail to order sufficient quantities of product components in a timely manner, the delivery of quantum solutions to our potential customers could be delayed.
+Added: We have previously failed, and may in the future fail, to accurately forecast customer demand, which resulted in, and may in the future result in, an excess or obsolescence of materials and supplies or volume availability of products.
Excess or obsolete materials and supplies may result in write-downs or write-offs.
If we fail to effectively manage our forecasted supply and demand and on hand materials and supplies, our results of operations and financial condition could be adversely impacted, and it could result in loss of revenue, increased costs or delays that could adversely impact customer success.
−Removed: Our systems depend on the use of a particular isotope of an atomic element that provides qubits for our ion trap technology.
−Removed: 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 that may be necessary for the production of our ion trap technology.
−Removed: We currently purchase such materials through the National Isotope Development Center managed by the U.S.
−Removed: Department of Energy Isotope Program.
−Removed: We do not have any supplier agreements with the U.S.
−Removed: Department of Energy, and purchase the materials through a standard ordering process.
−Removed: While we are currently looking to engage additional suppliers, there is no guarantee we will be able to establish or maintain relationships with such additional suppliers on terms satisfactory to us.
−Removed: Reliance on any single supplier increases the risks associated with being unable to obtain the necessary atomic samples because the supplier may have laboratory constraints, can be subject to unanticipated shutdowns and/or may be affected by natural disasters and other catastrophic events.
−Removed: Some of these factors may be completely out of our and our suppliers’ control.
−Removed: Failure to acquire sufficient quantities of the necessary isotopically enriched atomic samples in a timely or cost-effective manner could materially harm our business.
Our products may not achieve market success, but will still require significant costs to develop.
−Removed: We believe that we must continue to dedicate significant resources to our research and development efforts before knowing whether there will be market acceptance of our quantum computing and networking technologies.
+Added: We believe that we must continue to dedicate significant resources to our research and development efforts before knowing whether there will be market acceptance of our products and services.
Furthermore, the technology for our products is new, and the performance of these products is uncertain.
−Removed: Our quantum computing and networking technologies could fail to attain sufficient market acceptance, if at all, for many reasons, including:
+Added: Our quantum technologies could fail to attain sufficient market acceptance, if at all, for many reasons, including:
• pricing and the perceived value of our systems relative to its cost;
3 unchanged sentences
• failures to accurately predict market or customer demands;
−Removed: • defects, errors or failures in the design or performance of our quantum computing systems;
+Added: • defects, errors or failures in the design or performance of our quantum systems;
• negative publicity about the performance or effectiveness of our systems;
1 unchanged sentence
• the introduction or anticipated introduction of competing technology.
−Removed: To the extent we are unable to effectively develop and market a quantum computing system to address these challenges and attain market acceptance, our business, operating results and financial condition may be adversely affected.
+Added: To the extent that we are unable to effectively develop and market quantum solutions to address these challenges and attain market acceptance, our business, operating results and financial condition may be adversely affected.
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.
−Removed: The quantum computing and networking market is characterized by rapid technological change, changing user requirements, uncertain product lifecycles and evolving industry standards.
−Removed: We believe that the pace of innovation will continue to accelerate as technology changes and different approaches to quantum computing mature on a broad range of factors, including system architecture, error correction, performance and scale, integration with classical computing resources, ease of programming, user experience, markets addressed, types of data processed, and data governance and regulatory compliance.
−Removed: Our future success depends on our ability to continue to innovate and increase customer adoption of our quantum computers and networks.
−Removed: If we are unable to enhance our quantum computing system to keep pace with these rapidly evolving customer requirements, or if new technologies emerge that are able to deliver competitive products at lower prices, more efficiently, with better functionality, more conveniently, or more securely than our platform, our business, financial condition and results of operations could be adversely affected.
−Removed: 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.
−Removed: 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:
−Removed: • obtain expertise in relevant markets;
−Removed: • obtain sales and marketing services or support;
−Removed: • obtain equipment and facilities;
−Removed: • develop relationships with potential future customers;
−Removed: • generate revenue.
−Removed: We may not be successful in establishing or maintaining suitable partnerships, and we may not be able to negotiate collaboration agreements having terms satisfactory to us, or at all.
−Removed: Failure to make or maintain these arrangements or a delay or failure in a collaborative partner’s performance under any such arrangements could harm our business and financial condition.
−Removed: Our business depends on our customers’ abilities to implement useful quantum algorithms and sufficient quantum resources for their business.
+Added: The quantum market is characterized by rapid technological change, changing user requirements, uncertain product lifecycles and evolving industry standards.
+Added: We believe that the pace of innovation will continue to accelerate as technology changes and different approaches to quantum technologies mature on a broad range of factors, including system architecture, error correction, performance and scale, integration with classical computing resources, ease of programming, user experience, markets addressed, types of data processed and data governance and regulatory compliance.
+Added: Our future success depends on our ability to continue to innovate and increase customer adoption of our quantum solutions.
+Added: If we are unable to enhance our quantum technologies to keep
+Added: pace with these rapidly evolving customer requirements, or if new technologies emerge that are able to deliver competitive products at lower prices, more efficiently, with better functionality, more conveniently or more securely than our platform, our business, financial condition and results of operations could be adversely affected.
+Added: Our business depends on our customers’ ability to implement useful quantum algorithms and sufficient quantum resources for their business.
If they are unable to do so, including due to their algorithmic challenge or other technical or personnel dilemmas, our growth may be negatively impacted.
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.
−Removed: The success of these contracts and partnerships is dependent on our customer’s ability to identify, implement, and realize useful and scalable algorithms for their portfolio at a speed commensurate with the pace of hardware, software, and technological development.
+Added: The success of these contracts and partnerships is dependent on the customer’s ability to identify, implement and realize useful and scalable algorithms for its portfolio at a speed commensurate with the pace of hardware, software and technological development.
These arrangements are also dependent on the availability of time and resources to develop and optimize these algorithms.
−Removed: The development and optimization of these algorithms is reliant on employing sufficient talent familiar with quantum computing and quantum networking, unique skills that require special training and education.
+Added: The development and optimization of these algorithms is reliant on employing sufficient talent familiar with quantum technologies, unique skills that require special training and education.
If the market fails to train a sufficient number of engineers, researchers and other key quantum personnel, our customers may not find sufficient talent to partner with us to solve these problems.
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: We are highly dependent on our key employees who have specialized knowledge, and our ability to attract and retain senior management and other key employees is critical to our success.
−Removed: Our future success is highly dependent on our ability to attract and retain our executive officers, key employees and other qualified personnel, including our employees who have specialized knowledge and our employees from acquired businesses.
+Added: We are highly dependent on our key employees who have specialized knowledge, and our ability to attract and retain senior management and other key employees is critical to our success, and we have recently experienced significant turnover in our top management, which could adversely affect our business.
+Added: Our future success is highly dependent on our ability to attract and retain our executive officers, key employees, subject matter experts and other qualified personnel, including our employees who have specialized knowledge and our employees from acquired businesses.
We have experienced in the past, and as we build our brand and become more well known, there is increased risk that we may further experience in the future, competitors or other companies hiring our personnel.
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Our future success also depends on our continuing ability to attract, develop, motivate and retain highly qualified and skilled employees.
−Removed: The market for highly skilled workers and leaders in the quantum computing industry is extremely competitive.
−Removed: 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 and networking systems.
+Added: The market for highly skilled workers and leaders in the quantum industry is extremely competitive.
+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 solutions.
Some of these professionals are hard to find and we may encounter significant competition in our efforts to hire them.
Many of the other companies with which we compete for qualified personnel have greater financial and other resources than we do.
−Removed: The effective operation of our supply chain, including the acquisition of critical components and materials, the development of our quantum computing and networking technologies, the commercialization of our quantum computing and networking technologies and the effective operation of our managerial and operating systems all depend upon our ability to attract, train and retain qualified personnel in the aforementioned specialties.
−Removed: Additionally, changes in immigration and work permit laws and regulations or the administration or interpretation of such laws or regulations, including changes following the recent U.S.
−Removed: federal elections, could impair our ability to attract and retain highly qualified employees.
−Removed: If we cannot attract, train and retain qualified personnel, in this competitive environment, we may experience delays in the development of our quantum computing and networking technologies and be otherwise unable to develop and grow our business as projected, or even at all.
+Added: The effective operation of our supply chain, including the acquisition of critical components and materials, the development and commercialization of our quantum technologies and the effective operation of our managerial and operating systems all depend upon our ability to attract, train and retain qualified personnel in the aforementioned specialties.
+Added: Additionally, changes in immigration and work permit laws and regulations or the administration, interpretation or enforcement of such laws or regulations could impair our ability to attract and retain highly qualified employees.
+Added: If we cannot attract, train and retain qualified personnel, in this competitive environment, we may experience delays in the development of our quantum technologies and be otherwise unable to maintain customer relationships or develop and grow our business as projected, or even at all.
+Added: Additionally, during 2025, as we began to bring on the talent that we believe is necessary to guide us through our next stage of rapid and transformative growth, we experienced significant turnover in our executive ranks and on our Board of Directors.
+Added: Management transition, even where initiated by the company, is often difficult and inherently causes some loss of institutional knowledge and a learning curve for new executives, which could negatively affect our results of operations and financial condition.
+Added: Our ability to execute our business strategies may be adversely affected by the uncertainty associated with any such transition, and the time and attention from the board and management needed to train new employees and those of newly acquired and integrated companies could disrupt our business.
+Added: Further, we expect to continue to acquire and integrate new businesses, and we cannot guarantee that we will not face turnover in the future.
+Added: Although we generally enter into employment agreements with our executives, the agreements have no specific duration and our executive officers are at-will employees.
+Added: As a result, they may terminate their employment relationship with us at any time, and we cannot ensure that we will be able to retain the services of any of them.
+Added: Our senior management’s knowledge of our business and industry would be difficult to replace, and any further turnover could negatively affect our business, growth, financial conditions, results of operations and cash flows.
Much of our revenue is concentrated in a few customers, and if we lose any of these customers through contract terminations, acquisitions, or other means, our revenue may decrease substantially.
2 unchanged sentences
A disruption in our relationship with any of our customers could adversely affect our business.
−Removed: Our inability to meet our customers’ requirements or to qualify our products with them could
−Removed: adversely impact our revenue.
+Added: Our inability to meet our customers’ requirements or to qualify our products with them could adversely impact our revenue.
The loss of, or restrictions on our ability to sell to, one or more of our major customers, or any significant reduction in orders from customers could have a material adverse effect on our operating results and financial condition.
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government budget and appropriation decisions and processes, which are driven by numerous factors, including geo-political events and macroeconomic conditions.
−Removed: Significant reduction in U.S.
+Added: Even an announced and partially-funded program or contract can be canceled.
+Added: And continuing resolutions and lapses in appropriations can delay contract awards, payments and program execution.
+Added: Sequestration or other automatic budget cuts could reduce funding for programs that we support or from which we benefit.
+Added: Budget uncertainties can make it more difficult for us to forecast revenue from government contracts, plan our operations and make strategic investments.
+Added: Extended periods of budget uncertainty, such as prolonged continuing resolutions or multiple lapses in appropriations, could delay our revenue recognition, strain our cash flows and force us to reduce planned investments or staffing.
+Added: A significant reduction in U.S.
government spending could have long-term consequences for our size and structure.
In addition, changes 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.
−Removed: Contracts with domestic and international government and state agencies are subject to a number of challenges and risks.
−Removed: Contracts with domestic and international government and state agencies are subject to a number of challenges and risks.
+Added: Contracts with U.S.
+Added: federal and state and international government agencies are subject to a number of challenges and risks.
+Added: Contracts with U.S.
+Added: federal and state and international government agencies are subject to a number of challenges and risks.
The bidding process for government contracts can be highly competitive, expensive and time-consuming, often requiring significant up front time and expense without any assurance that these efforts will generate revenue.
+Added: Also, certain government contracts may be set-aside for small businesses, effectively giving a preference to those small businesses.
+Added: If a particular procurement is set-aside for only small businesses, we may lose sales opportunities and may not be able to replace those opportunities with sales to other customers.
We also must comply with both local and international 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.
Any changes to the government regulations applicable to government contracts could affect our ability to enter into, or the profitability of, contracts with government entities.
+Added: Contracting with the U.S.
+Added: government, particularly with defense and intelligence agencies, requires compliance with extensive and evolving regulatory requirements.
+Added: Achieving and maintaining compliance with these requirements is expensive and time consuming and requires specialized expertise.
+Added: As these requirements evolve, we may need to make additional investments or modify our operations to maintain compliance.
+Added: Further, some of our subsidiaries hold U.S.
+Added: government-issued facility security clearances and certain of our employees have qualified for and hold U.S.
+Added: government-issued personnel security clearances necessary to qualify for and ultimately perform certain U.S.
+Added: government contracts.
+Added: Obtaining and maintaining security clearances for employees involves lengthy processes, and it is difficult to identify, recruit and retain employees who already hold security clearances.
+Added: If these employees are unable to obtain or retain security clearances or if our employees who hold security clearances terminate employment with us and we are unable to find replacements with equivalent security clearances, we may be unable to perform our obligations to customers whose work requires cleared employees, or such customers could terminate their contracts or decide not to renew them upon their expiration.
+Added: government could also “invalidate” our facility security clearances for several reasons including unmitigated foreign ownership, control or influence, mishandling of classified materials or failure to properly report required activities.
+Added: An inability to obtain or retain our facility security clearances or engage employees with the required personnel security clearances for a particular contract could disqualify us from bidding for and winning new contracts with security requirements as well as result in the termination of any existing contracts requiring such security clearances.
In addition, other parties’ perceptions of our relationship with the U.S.
10 unchanged sentences
• 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;
−Removed: • changes in the government’s attitude towards us as a company or our technology;
+Added: • changes in the government’s attitude towards us as a company or our technology, including decisions by a government to favor our competitors or their technologies over us and our technologies;
• 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;
• the adoption of new laws or regulations or changes to existing laws or regulations;
−Removed: • budgetary constraints, including automatic reductions as a result of “sequestration,” operating under continuing resolutions, disruptions from government shutdowns, or similar measures and constraints imposed by any lapses in appropriations for the federal government or certain of its departments and agencies;
+Added: • budgetary constraints, including automatic reductions as a result of “sequestration,” operating under continuing resolutions, disruptions from government shutdowns or similar measures and constraints imposed by any lapses in appropriations for the federal government or certain of its departments and agencies, or any U.S.
+Added: state or foreign government;
• influence by, or competition from, third parties with respect to pending, new, or existing contracts with government customers;
4 unchanged sentences
If our information technology systems, data, or physical facilities, or those of third parties upon which we rely, are or were compromised, we could experience adverse business consequences resulting from such compromise.
−Removed: In the ordinary course of business, we access, collect, receive, store, generate, use, transfer, disclose, make accessible, protect, secure, dispose of, transmit, share, and otherwise process 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 vendors and their own supply chains, our customers, or other third parties (collectively, “Sensitive Data”).
+Added: In the ordinary course of business, we access, collect, receive, store, generate, use, transfer, disclose, make accessible, protect, secure, dispose of, transmit, share, and otherwise process 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 vendors and their own supply chains, our customers, or other third parties, which we refer to collectively as Sensitive Data.
We and the third parties upon which we rely 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, and physical facilities (such as those where our quantum computers are stored), including but not limited to ransomware attacks, advanced persistent threats and other causes of security incidents.
−Removed: Additionally, Sensitive Data could be leaked, disclosed or revealed as a result of or in connection with our employees', contractors', consultants', affiliates', or vendors' use of generative artificial intelligence (“AI”) technologies.
+Added: Additionally, Sensitive Data could be leaked, disclosed or revealed as a result of or in connection with our employees’, contractors’, consultants’, affiliates’ or vendors' use of generative artificial intelligence, or AI, technologies.
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.
9 unchanged sentences
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.
−Removed: 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: Remote work has increased risks to our information technology systems and data, as more of our employees use network connections, computers, and devices outside our premises or network, including working at home, while in transit and in public locations.
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.
−Removed: 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: Furthermore, we may discover security issues that were not found during due diligence of such
+Added: acquired or integrated entities, and it may be difficult to integrate companies into our information technology environment and security program.
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.
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As a result, we may be unable to implement adequate preventative and responsive measures to stop or mitigate security incidents before or while they are occurring.
−Removed: incidents that may appear to be minor when assessed individually, may become material, at a later date, when considered in the aggregate.
+Added: Finally, incidents that may appear to be minor when assessed individually, may become material, at a later date, when considered in the aggregate.
Applicable privacy and security obligations may require us to notify relevant stakeholders of security incidents.
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The global economy, including credit and financial markets, has experienced extreme volatility and disruptions, including severely diminished liquidity and credit availability, declines in customer 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 and any future public health crises could result in similar impacts on the global economy.
+Added: For example, the coronavirus 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.
Similarly, geopolitical tensions in and around Ukraine, Israel and other areas of the world have created extreme volatility in the global capital markets and are expected to have further global economic consequences, including disruptions of the global supply chain and energy markets, and further acts of war, terror, or responses to each could result in similar or increased impacts on the global economy.
Increased inflation rates can adversely affect us by increasing our costs, including labor and employee benefit costs.
−Removed: 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: Employee salaries and benefits expenses have increased as a result of economic growth, increased demand for business services and increased competition for trained and talented employees, among other wage-inflationary pressures and we cannot assure that they will not continue to rise.
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.
6 unchanged sentences
Furthermore, a disruption or failure of our systems or operations because of an earthquake, weather event, cyberattack, terrorist attack, pandemic or other catastrophic event could cause delays in providing services or performing other critical functions, which could also delay commercial deals and the associated revenue recognition for those deals.
−Removed: Our quantum computing manufacturing facility and a significant portion of our research and development activities, and certain other essential business operations are located in the Seattle, Washington area, which is a seismically active region.
−Removed: A catastrophic event that results in the destruction or disruption
−Removed: of any of our critical business or IT systems, or the infrastructure or systems they rely on could harm our ability to conduct normal business operations.
−Removed: Government actions and regulations, such as tariffs and trade protection measures, especially in China and the United States, may adversely impact our business, including our ability to obtain products from our suppliers.
−Removed: Political challenges between the United States and countries in our supply chain, including China, and changes to trade policies, including tariff rates and customs duties, trade relations between the United States and China and other macroeconomic issues could adversely impact our business.
−Removed: Specifically, United States-China trade relations remain uncertain.
−Removed: The United States administration has continued to impose tariffs on certain products imported into the United States with China as the country of origin, and China has imposed tariffs in response to the actions of the United States.
−Removed: The likelihood of a further increase in tariffs on goods from China and the imposition of tariffs on goods sourced from other countries has materially increased in light of comments by the new U.S.
−Removed: presidential administration, which has repeatedly communicated an intention to impose additional duties on imports from China, as well as on imports from other countries.
−Removed: government continues to add additional entities, in China and elsewhere, to restricted party lists impacting the ability of U.S.
+Added: Our principal manufacturing facility and a significant portion of our research and development activities, and certain other essential business operations, are located in the Seattle, Washington area, which is a seismically active region.
+Added: A catastrophic event that results in the destruction or disruption of any of our critical business or IT systems, or the infrastructure or systems they rely on could harm our ability to conduct normal business operations.
+Added: Government actions and regulations, such as tariffs and trade protection measures, especially in the United States, may adversely impact our business, including our ability to obtain products from our suppliers.
+Added: Political challenges between the United States and countries in our supply chain, and changes to trade policies, including tariff rates and customs duties, trade relations between the United States and other countries and other macroeconomic issues could adversely impact our business.
+Added: government continues to add additional entities to restricted party lists impacting the ability of U.S.
companies to provide products and technology, and, in certain cases, services, to these entities and, in some cases, to receive products, technology or services from these entities.
−Removed: government also continues to increase end-use restrictions on the provision of products, technology and services to China and other countries including end-uses related to advanced computing.
−Removed: presidential administration has signaled its intention to use U.S.
−Removed: trade policy, including tariffs and other trade restrictions, as an important foreign policy tool presenting uncertainty regarding the impact of future trade policies on our business.
−Removed: There is also a possibility of future tariffs, trade protection measures or other restrictions imposed on our products or on our customers by the United States, China or other countries that could have a material adverse effect on our business.
−Removed: In addition, the Chinese government exercises significant control over China’s economy through the allocation of resources, control of the incurrence and payment of foreign currency-denominated obligations, setting of monetary policy and provision of preferential treatment to particular industries or companies.
−Removed: Changes in any of these policies, laws and regulations could adversely affect the overall economy in China or our Chinese suppliers, which could harm our business through higher supply costs, reduced availability or both.
−Removed: Also, due to concerns with the security of products and services from certain telecommunications equipment and services companies based in China, U.S.
−Removed: Congress has enacted bans on the use of certain Chinese-origin components or systems either in items sold to the U.S.
−Removed: government or in the internal networks of government contractors and subcontractors (even if those networks are not used for government-related projects).
−Removed: Further, the Chinese government has responded to these U.S.
−Removed: actions by developing an unreliable entity list, which may limit the ability of companies on the list to engage in business with Chinese counterparties.
−Removed: In June 2022, the import restrictions contained in the Uyghur Forced Labor Prevention Act (“UFLPA”) became effective.
−Removed: The UFLPA creates a rebuttable presumption that any goods mined, produced or manufactured, wholly or in part, in the Xinjiang Uyghur Autonomous Region (“XUAR”) of China, or produced by a listed entity, were made with forced labor and would therefore not be entitled to entry at any U.S.
−Removed: Importers may be required to present clear and convincing evidence that such goods are not made with forced labor.
−Removed: While we do not source items from the XUAR or from listed parties, and we have increased our supply chain diligence, there is risk that our ability to import components and products may be adversely affected by the UFLPA.
−Removed: Given the relatively fluid regulatory environment in China and the United States and uncertainty regarding how the U.S.
−Removed: government or Chinese and other foreign governments will act with respect to tariffs and international trade agreements and policies, a trade war, further governmental action related to tariffs or international trade policies, or additional tax or other regulatory changes in the future could directly and adversely impact our financial results and results of operations.
−Removed: We cannot predict what actions may ultimately be taken with respect to trade relations between the United States and China or other countries, what products may be subject to such actions or what actions may be taken by the other countries in retaliation.
−Removed: If we are unable to obtain or use components for inclusion in our products, if component prices increase significantly or if we are unable to export or sell our products to any of our customers, our business, liquidity, financial condition and/or results of operations would be materially and adversely affected.
+Added: government also continues to increase end-use restrictions on the provision of products, technology and services to other countries including end-uses related to advanced computing.
+Added: There is also a possibility of future tariffs, trade protection measures or other restrictions imposed on our products or on our customers by the United States or other countries that could have a material adverse effect on our business.
+Added: In addition, other governments sometimes exercise significant control over their economies through the allocation of resources, control of the incurrence and payment of foreign currency-denominated obligations, setting of monetary policy and provision of preferential treatment to particular industries or companies.
+Added: Changes in any of these policies, laws and regulations could adversely affect the overall economy in those countries or our suppliers in those countries, which could harm our business through higher supply costs, reduced availability or both.
+Added: Given the relatively fluid regulatory environment, a trade war, further governmental action related to tariffs or international trade policies, or additional tax or other regulatory changes in the future could directly and adversely impact our financial results and results of operations.
+Added: We cannot predict what actions may ultimately be taken with respect to trade relations between the United States or other countries, what products may be subject to such actions or what actions may be taken by the other countries in retaliation.
+Added: we are unable to obtain or use components for inclusion in our products, if component prices increase significantly or if we are unable to export or sell our products to any of our customers, our business, liquidity, financial condition and/or results of operations would be materially and adversely affected.
We are subject to governmental export and import controls and trade and economic sanctions that could impair our ability to compete in global markets and subject us to liability if we are not in full compliance with applicable laws and other controls.
−Removed: Our products, technology, and services are subject to various restrictions under U.S.
+Added: Our products, technology, technical data and services are subject to various restrictions under U.S.
export controls, import laws and regulations and economic sanctions, including the U.S.
Export Administration Regulations administered by the U.S.
−Removed: Department of Commerce, U.S.
−Removed: Customs regulations, and trade and economic sanctions administered by the U.S.
−Removed: Department of Treasury’s Office of Foreign Assets Control.
+Added: Department of Commerce Bureau of Industry and Security, International Traffic in Arms Regulations administered by the U.S.
+Added: Department of State Directorate of Defense Trade Controls, U.S.
+Added: Customs regulations, trade and economic sanctions administered by the U.S.
+Added: Department of Treasury’s Office of Foreign Assets Control and similar laws of other jurisdictions.
export controls and trade and economic sanctions include restrictions or prohibitions on the sale or supply of certain products, technologies and services to U.S.
embargoed or sanctioned countries and governments of these countries, as well as other persons and entities;
−Removed: Additionally, under these current and future laws and regulations, exports of our products, technology, and services as well as the underlying technology may require export authorizations, including by license, a license
−Removed: exception, or other appropriate government authorizations, and the filing of a classification request or self-classification report to use a license exception, as applicable.
+Added: regulations controlling foreign-made products that incorporate U.S.-origin technology or are produced using U.S.-origin technology or software;
+Added: and controls on the release of controlled technology to foreign nationals within the United States.
+Added: Additionally, under these current and future laws and regulations, exports of our products, technology, and services as well as the underlying technology may require export authorizations, including by license, a license exception, or other appropriate government authorizations, and the filing of a classification request or self-classification report to use a license exception, as applicable.
Customers may defer or decline their purchases of our products due to uncertainty about export controls, and as a result, our business could be materially adversely affected.
−Removed: Should we violate existing or similar future export controls or sanctions, we may be subject to substantial monetary fines or suffer reputational damage and other penalties that could negatively impact our business.
+Added: Should we violate existing or similar future export controls or sanctions, we may be subject to substantial monetary fines, civil and criminal penalties, denial of export privileges, debarment from government contracting, loss of security clearances, imposition of remediation costs or suffer reputational damage, any of which could negatively impact our business.
If we need to obtain any necessary export licenses or other authorizations for a particular sale, the process may be time-consuming and may result in the delay or loss of opportunities to sell our products.
+Added: The complexity and rapidly changing nature of export control regulations make compliance challenging and expensive.
We take precautions to prevent our products and services and the underlying technology from being provided, deployed or used in violation of export controls and sanctions.
2 unchanged sentences
sanctions or export controls, including failure to obtain appropriate import, export, or re-export licenses or authorization, could result in significant penalties and government investigations, delays in approving or denials of export licenses, and reputational harm and loss of business.
+Added: As noted above, the U.S.
+Added: government continues to add additional entities to restricted party lists impacting the ability of U.S.
+Added: companies to provide products and technology, and, in certain cases, services, to these entities, and in some cases, to receive products, technology, or services from these entities.
In addition to the United States, various other countries regulate the import and export of certain encryption and other technology, including import and export licensing requirements, and have enacted laws that could limit our ability to distribute our products, technologies, and services or could limit our clients’ ability to implement our products, technologies, and services in those countries.
−Removed: The United States, United Kingdom, France, Spain, Germany, Denmark, Finland, Norway, Slovenia, Japan, Canada, and the Netherlands have recently enacted export controls on quantum computing hardware and related software and technology at specified levels of technological advancement.
+Added: The United States and a number of other countries have recently enacted export controls on quantum computing hardware and related software and technology at specified levels of technological advancement.
We will continue to review our existing compliance measures to ensure compliance with any applicable regulatory changes.
Changes in our products, or future changes in export and import regulations, may create delays in the introduction of our products and the underlying technology in international markets, prevent our clients with global operations from deploying our products globally, adversely affect our ability to hire personnel from certain countries to work on our products, or, in some cases, prevent the export or import of our products to certain countries, governments, or persons altogether.
+Added: Complex re-export rules create significant compliance burdens and operational delays.
+Added: When we export products or technology from the United States that contain non-U.S.
+Added: origin controlled items, or when we re-export items between our non-U.S.
+Added: facilities, we may need authorization from multiple countries.
+Added: The deemed export rules in multiple jurisdictions also restrict sharing technical data with foreign nationals within our own facilities, complicating our ability to utilize our global workforce.
+Added: These overlapping requirements create lengthy approval timelines, increase compliance costs and may delay or prevent sales to certain markets.
+Added: We face end-use monitoring obligations across jurisdictions.
+Added: Multiple countries require ongoing monitoring and reporting of how exported products and technology are used by foreign customers.
+Added: These requirements are particularly stringent for sales to government customers or for satellites with defense or intelligence applications.
+Added: Failure to detect or report unauthorized use,
+Added: re-transfer or modification of our products could result in license violations and future export denials.
+Added: Customer reluctance to accept monitoring provisions may limit our market access.
Any change in export or import controls, economic sanctions or related legislation, shift in the enforcement or scope of existing laws and regulations, or change in the countries, governments, persons, or technologies targeted by such regulations, could result in decreased use of our products by, or in our decreased ability to export or sell our products to, existing or potential customers.
1 unchanged sentence
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 as well as increased licensing requirements and other restrictions.
−Removed: Acquisitions, divestitures, strategic investments and strategic partnerships could disrupt our business and harm our financial condition and operating results.
−Removed: We have pursued and we may continue to pursue growth opportunities by acquiring complementary businesses, solutions or technologies through strategic transactions, investments or partnerships.
−Removed: 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.
−Removed: If such strategic transactions require us to seek additional debt or equity financing, we may not be able to obtain such financing on terms favorable to us or at all, and such transactions may adversely affect our liquidity and capital structure.
−Removed: To the extent we issue equity and/or convertible securities as consideration in such strategic transactions, our stockholders may experience substantial dilution.
−Removed: Any strategic transaction might not strengthen our competitive position, may increase some of our risks, and may be viewed negatively by our customers, partners or investors.
−Removed: 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.
−Removed: GAAP and may not achieve the anticipated benefits of any strategic transaction.
−Removed: 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.
+Added: Regulations related to quantum technologies are currently evolving and we may face additional risks associated with changes to these regulations as well as increased licensing requirements and other restrictions.
Risks Related to Our International Expansion and Future Operations
+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: We have entered into, and may enter into, strategic partnerships to nurture the growth of a nascent quantum ecosystem and develop and commercialize our current and future research and development programs with other companies to accomplish one or more of the following:
+Added: • obtain expertise in relevant markets;
+Added: • obtain sales and marketing services or support;
+Added: • obtain equipment and facilities;
+Added: • develop relationships with potential future customers;
+Added: • generate revenue.
+Added: We may not be successful in establishing or maintaining suitable partnerships, and we may not be able to negotiate collaboration agreements having terms satisfactory to us, or at all.
+Added: Failure to make or maintain these arrangements or a delay or failure in a collaborative partner’s performance under any such arrangements could harm our business and financial condition.
+Added: The SkyWater Acquisition may not be completed within the expected timeframe, or at all.
+Added: There can be no assurance that the SkyWater Acquisition will be completed in the expected timeframe, or at all.
+Added: Consummation of the SkyWater Acquisition is conditioned on, among other things, obtaining regulatory approval in the United States.
+Added: If any of the conditions to the SkyWater Acquisition is not satisfied, it could delay or prevent the SkyWater transaction from occurring.
+Added: Further, as a condition of its approval of the SkyWater Acquisition, regulatory agencies may impose requirements, limitations or costs or require divestitures or place conditions on the conduct of our business after the closing, any of which could jeopardize or delay the consummation of the SkyWater Acquisition, result in a material adverse effect on our business or reduce the anticipated benefits to us of the SkyWater Acquisition.
+Added: The SkyWater Acquisition may cause our financial results to differ from expectations, we may not achieve the anticipated benefits of the SkyWater Acquisition and the SkyWater Acquisition may disrupt our current plans or operations.
+Added: The success of the SkyWater Acquisition will depend, in part, on our ability to successfully integrate the acquired business and realize the anticipated benefits.
+Added: Difficulties in integrating the acquired business, which is in a different industry from the industry in which our management team has experience, may result in operational challenges and in the diversion of management’s time and attention from ongoing business opportunities, challenges and risks, as well as in unforeseen expenses or losses in revenue, which may have an adverse impact on our financial results.
+Added: Acquisitions and other strategic investments involve a number of inherent risks, any of which could result in the benefits anticipated not being realized.
+Added: Acquisitions are an important component of our growth strategy and we have pursued and we may continue to pursue growth opportunities by acquiring businesses, solutions or technologies through strategic transactions, investments or partnerships that complement or expand our current business, including expansion into adjacent industries, with the expectation that these transactions
+Added: will result in increases in sales, synergies and various other benefits.
+Added: However, there can be no assurance that we will be able to continue to grow our business through acquisitions or other strategic transactions or that any businesses acquired will perform in accordance with expectations or that business judgments concerning the value, strengths and weaknesses of businesses acquired will prove to be correct.
+Added: The identification of suitable acquisition, strategic investment or strategic partnership candidates can be costly and time consuming.
+Added: If such strategic transactions require us to seek additional debt or equity financing, we may not be able to obtain such financing on terms favorable to us or at all, and such transactions may adversely affect our liquidity and capital structure.
+Added: To the extent we issue equity or convertible securities as consideration in such strategic transactions, our stockholders may experience substantial dilution.
+Added: Certain of our strategic investments are or may be with companies that are not publicly traded and our ability to liquidate and realize value from our investments may also be limited.
+Added: Further, while we have not engaged in a divestiture to date, and do not have any current intention to engage in a divestiture or similar transaction, we may in the future determine to further concentrate our focus on our principal products and services by divesting non-core businesses.
+Added: As with acquisitions, investments and partnerships, divestitures can be complicated and distracting, and there is no assurance that we would be able to realize the benefits that we anticipate from them.
+Added: Any strategic transaction might not strengthen our competitive position, may increase some of our risks, may raise new compliance-related obligations and challenges, may distract our management team from our current operations, may be viewed negatively by our customers, partners or investors or we may have to delay or not proceed with announced strategic transactions.
+Added: If an acquired business fails to operate as anticipated or cannot be successfully integrated with our existing business, or if a divested business cannot be successfully disentangled from our remaining businesses, it could have a material adverse effect on our business or financial condition.
+Added: Even if we successfully complete a strategic transaction, we may not be able to effectively integrate the acquired business, technology, IT and other systems, control environment, solutions or operations into our business, and we may have difficulty integrating and retaining new employees.
+Added: 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 subsequent to the strategic transaction that were not identified during our due diligence review for which we have limited or no recourse.
+Added: In addition, our expansion into new markets or adjacent industries through acquisition may present competitive, management and regulatory challenges that differ from current ones.
+Added: We may be less familiar with the target customers and may face different or additional risks, as well as increased or unexpected costs, compared to existing operations.
+Added: Growth into new markets may also bring us into direct competition with companies with whom we have little or no past experience as competitors.
+Added: In connection with any acquisition, we may acquire liabilities or defects such as legal claims, including those not identified during due diligence, such as third-party liability and other tort claims;
+Added: claims for breach of contract;
+Added: employment-related claims;
+Added: environmental, health and safety liabilities, conditions or damage;
+Added: permitting, regulatory or other compliance with law issues;
+Added: liability for hazardous materials;
+Added: or trade liabilities.
+Added: If we acquire any of these liabilities, and they are not adequately covered by insurance or an enforceable indemnity or similar agreement from a creditworthy counterparty or are otherwise mitigated, we may be responsible for significant out-of-pocket expenditures.
+Added: In connection with any divestitures, we may incur liabilities for breaches of representations and warranties or failure to comply with operating covenants under any agreement for a divestiture.
+Added: In addition, we may indemnify a counterparty in a divestiture for certain liabilities of the subsidiary or operations subject to the divestiture transaction.
+Added: These liabilities, if they materialize, could have a material adverse effect on our business or financial condition.
+Added: Additionally, in connection with certain of our strategic investments, we enter into commercial contracts for certain of our products or services from time to time.
+Added: When determining the total value of consideration from these investments, we assess customers’ financial condition, including the consideration of their ability and intention to pay, and whether all or some portion of the value of the contracts meet the criteria for revenue recognition, among other factors.
+Added: Certain companies with which we may enter into commercial contracts may be unable to access any necessary financing or funding in a timely manner or on favorable terms which could negatively impact our expected revenue and collections.
+Added: The occurrence of any of these risks could have a material adverse effect on our business, results of operations, and financial condition.
Because our success depends, in part, on our ability to expand sales internationally, our business will be susceptible to risks associated with international operations.
1 unchanged sentence
We expect to continue to expand our international operations by developing our sales and operations presence internationally, which may include opening offices in new jurisdictions.
−Removed: Any additional international expansion efforts that we are undertaking and may undertake may not be successful.
+Added: Any additional international expansion efforts that we are undertaking and may undertake may
+Added: not be successful.
In addition, conducting international operations subjects us to new risks, some of which we have not generally faced in the United States or other countries where we currently operate.
3 unchanged sentences
• an evolving legal framework and additional legal or regulatory requirements for 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 privacy documentation (including locally compliant privacy notices 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;
−Removed: • unexpected changes in regulatory requirements, taxes, trade laws, tariffs, export quotas, custom duties or other trade restrictions;
+Added: • unexpected changes in regulatory requirements, taxes, foreign investment rules, trade laws, tariffs, export quotas, custom duties or other trade restrictions;
• difficulties in managing systems integrators and partners;
15 unchanged sentences
Compliance with laws and regulations applicable to our global operations also substantially increases our cost of doing business in foreign jurisdictions.
−Removed: We have limited experience in marketing, selling and supporting our platform outside of the United States.
+Added: We have limited experience in marketing, selling and supporting our solutions outside of the United States.
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.
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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.
−Removed: 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: Although we have implemented policies and
+Added: 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.
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.
−Removed: Our international sales and operations subject us to additional risks and costs exposure to foreign currency exchange rate fluctuations, that can adversely affect 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 exposure to foreign currency exchange rate fluctuations, that can adversely affect our business, financial condition, revenues, results of operations or cash flows.
We are continuing to expand our international operations as part of our growth strategy.
−Removed: 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.
−Removed: Furthermore, we cannot predict the rate at which our quantum computers will be accepted in international markets by potential customers.
+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 solutions, 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 solutions will be accepted in international markets by potential customers.
Our sales, support and engineering organization outside the United States is substantially smaller than our U.S.
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Our business is exposed to risks associated with litigation, investigations and regulatory proceedings.
−Removed: We may face legal, administrative and regulatory proceedings, claims, demands and/or investigations involving stockholders, customers, competition and/or other issues relating to our business.
+Added: We may face, and in certain circumstances have faced, legal, administrative and regulatory proceedings, claims, demands and/or investigations involving stockholders, customers, 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.
−Removed: In May 2022, a securities class action complaint captioned Leacock v.
−Removed: et al., Case No.
−Removed: 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.
−Removed: In June 2022, a securities class action complaint captioned Fisher v.
−Removed: IonQ, Inc., Case No.
−Removed: 8:22-cv-01306-DLB (the “Fisher Litigation”) was filed by a stockholder against the Company and certain of the Company’s current officers (“IonQ Defendants”).
−Removed: 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.
−Removed: In September 2022, the Court appointed lead plaintiffs and counsel for lead plaintiffs, and ordered lead plaintiffs to file a consolidated amended complaint.
−Removed: The consolidated amended complaint was filed on November 22, 2022.
−Removed: As part of the consolidated amended complaint, certain members of the Company’s board of directors as well as other dMY-related defendants (“Additional Defendants”) have been added as defendants to the case.
−Removed: On February 7, 2023, the IonQ Defendants and the Additional Defendants each filed a motion to dismiss the consolidated amended complaint.
−Removed: On March 23, 2023, lead plaintiffs filed their omnibus opposition to the motions to dismiss.
−Removed: On April 26, 2023, the IonQ Defendants and the Additional Defendants each filed a reply in support of the motions to dismiss.
−Removed: On September 28, 2023, the District Court of Maryland issued an order dismissing plaintiffs' claims against the IonQ Defendants and the Additional Defendants with prejudice and directed the clerk to close the case.
−Removed: On October 26, 2023, the plaintiffs filed a motion for post-judgment relief, seeking to amend their consolidated amended complaint.
−Removed: The IonQ Defendants and Additional Defendants filed oppositions to plaintiffs’ motion on December 1, 2023, and plaintiffs filed their reply on January 8, 2024.
−Removed: On July 10, 2024, the plaintiffs' motion for post-judgment relief was denied and the District Court of Maryland directed the clerk to close the case.
−Removed: On July 26, 2024, the plaintiffs filed a Notice of Appeal with the Fourth Circuit Court of Appeals seeking to review the trial court's decision.
−Removed: Plaintiffs filed their Opening Brief in the Fourth Circuit on September 9, 2024.
−Removed: A response brief by IonQ Defendants was filed on October 8, 2024 and plaintiffs’ reply brief was filed on October 29, 2024.
−Removed: Oral argument in the Fourth Circuit occurred on January 31, 2025.
−Removed: Given the uncertainty of litigation and the legal standards that must be met for, among other things, success on the case merits, the Company cannot reasonably estimate the possible loss or range of loss, if any, that may result from the associated suit.
−Removed: 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: For example, in the second quarter of 2022, several of our stockholders filed securities class action complaints against us and certain of our officers in the United States District Court for the District of Maryland.
+Added: The suits were consolidated and the district court granted our motion to dismiss.
+Added: The United States Court of Appeals for the Fourth Circuit then upheld that ruling on appeal.
+Added: Although we prevailed in this litigation, we incurred substantial costs litigating it and defending our reputation and we cannot guarantee that future such cases will not be brought, or that we will similarly prevail if they are.
+Added: Any such proceedings and any other investigations, inquiries or litigation by various private actors or regulators may harm our reputation regardless of the outcome of any such action.
The outcome of any litigation, regardless of its merits, is inherently uncertain.
Any claims and lawsuits, and the disposition of such claims and lawsuits, could be 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.
−Removed: 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: 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 negatively affect our business.
Any damage to our reputation, including from publicity related to 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.
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We may become subject to product liability claims, even those without merit, which could harm our business prospects, operating results, and financial condition.
−Removed: We may face inherent risk of exposure to claims in the event our quantum computers do not perform as expected or malfunction.
+Added: We may face inherent risk of exposure to claims if our quantum solutions do not perform as expected or malfunction.
A successful product liability claim against us could require us to pay a substantial monetary award.
−Removed: Moreover, a product liability claim could generate substantial negative publicity about our quantum computers and business and inhibit or prevent commercialization of other future quantum computers, which would have material adverse effects on our brand, business, prospects and operating results.
+Added: Moreover, a product liability claim could generate substantial negative publicity about our quantum solutions and business and inhibit or prevent commercialization of other future quantum solutions, which would have material adverse effects on our brand, business, prospects and operating results.
Any insurance coverage might not be sufficient to cover all potential product liability claims.
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Contracts with government entities subject us to risks, including early termination, audits, investigations, sanctions and penalties.
−Removed: 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: As part of our business strategy, we have entered into and may enter into additional contracts with state, federal and foreign government entities, which subjects our business to statutes and regulations applicable to companies doing business with the government, including the Federal Acquisition Regulation.
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.
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• mandatory security and privacy framework compliance requirements, including the handling of controlled unclassified information,
−Removed: • mandatory socioeconomic compliance requirements, including labor requirements, non-discrimination and affirmative action programs and environmental compliance requirements.
Government contracts are also generally subject to greater scrutiny by the government than commercial contracts are by commercial customers.
For example, government agencies can initiate reviews, audits and investigations regarding our compliance with government contract requirements.
−Removed: 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 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) and state analogues or criminal law.
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.
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In addition, compliance with complex regulations and contracting provisions in a variety of jurisdictions can be expensive and consume significant management resources.
−Removed: Certain of our activities are subject to regulations relating to use of radioactive material, compliance with which may be costly, and a failure to comply with these regulations may materially and adversely affect our business.
−Removed: Various atomic species are used in trapped-ion systems in academic and commercial settings, including isotopes of elemental ions.
−Removed: Some of these atomic isotopes are radioactive.
−Removed: We use certain radioactive materials in our research, development, and production activities.
−Removed: As a result of our utilization of radioactive material, we and some of our suppliers, distributors, and customers are subject to regulation by United States governmental authorities, such as the Food and Drug Administration (“FDA”), the Nuclear Regulatory Commission (“NRC”), and state and local regulatory agencies, which regulate products and activities which emit, produce, or control radiation.
−Removed: These regulations govern, among other things, the design, development, testing, manufacturing, packaging, labeling, distribution, import/export, sale, marketing, and disposal of our products.
−Removed: We are also subject to international laws and regulations that apply to the utilization of radioactive materials.
−Removed: These are often comparable to, if not more stringent than, the equivalent regulations in the United States.
−Removed: Agency reviews of radioactivity-related applications that we are required to make in order to design, develop, test, manufacture, package, distribute, import, export, sell, market or dispose of radioactive materials may be lengthy or unsuccessful, and as a result our ability to sell our products or operate in certain jurisdictions may be impaired.
−Removed: Although we believe that our safety procedures for handling such materials comply with the standards prescribed by such laws and regulations, the risk of accidental contamination or injury from these materials may not be completely eliminated, and as a result we could incur related liabilities or expenses.
+Added: Our satellite operations depend on regulatory approvals, and any delays, denials, or changes in policy could harm our business, operations and financial results.
+Added: Our satellite operations require licenses from the Federal Communications Commission, or FCC, for spectrum usage and satellite operations, from National Oceanic and Atmospheric Administration, or NOAA, for commercial remote sensing activities, and from other U.S.
+Added: and international regulatory agencies to continue its operations.
+Added: We must also coordinate with National Telecommunications and Information Administration, or NTIA, for federal spectrum use.
+Added: These licenses contain conditions including deployment milestones, orbital debris mitigation requirements and potential operational restrictions.
+Added: We must also coordinate with NTIA for federal spectrum use.
+Added: The FCC has recently tightened orbital debris rules, requiring satellites to de-orbit within five years.
+Added: NOAA may impose restrictions on our imaging capabilities or operations based on national security reviews conducted by multiple agencies and the intelligence community.
+Added: Each of these regulatory structures imposes substantial compliance costs, and failure to obtain or maintain any such approval, or the imposition of more restrictive conditions, could prevent us from operating our constellation, limit our service offerings or harm our business.
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.
−Removed: We are subject to numerous federal, state and local environmental laws and regulations governing, among other things, solid and hazardous waste storage, treatment and disposal, and remediation of releases of hazardous materials.
+Added: We are subject to numerous federal, state, local and foreign environmental laws and regulations governing, among other things, solid and hazardous waste storage, treatment and disposal, and remediation of releases of hazardous materials.
There are significant capital, operating and other costs associated with compliance with these environmental laws and regulations.
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Our actual or perceived failure to comply with such obligations could lead to adverse business consequences.
−Removed: Our data storage and processing activities, including the establishment and operation of future quantum data centers, may subject us to numerous privacy, data protection 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 privacy, data
−Removed: localization and security.
+Added: Our data storage and processing activities, including the establishment and operation of future quantum data centers, may subject us to numerous privacy, data protection 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 privacy, data localization and security.
Laws and regulations governing privacy, data protection and data sovereignty are rapidly evolving, extensive, complex, and include inconsistencies and uncertainties that may conflict with other rules or our practices.
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In the United States, federal, state and local governments have enacted numerous 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).
−Removed: For example, the California Consumer Privacy Act of 2018, as amended by the California Privacy Rights Act (collectively, the “CCPA”) applies to personal information of California consumers and imposes various requirements on businesses, including to provide specific disclosures in privacy notices and honor requests of California consumers to exercise certain privacy rights.
+Added: For example, the California Consumer Privacy Act of 2018, as amended by the California Privacy Rights Act, which we refer to collectively as the CCPA, applies to personal information of California consumers and imposes various requirements on businesses, including to provide specific disclosures in privacy notices and honor requests of California consumers to exercise certain privacy rights.
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.
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Our employees and personnel use generative AI technologies to perform their work, and the disclosure and use of personal information in generative AI technologies is subject to various evolving laws, regulations, guidance, industry standards, and other obligations.
−Removed: Additionally, several states and localities have enacted measures related to the use of artificial intelligence and machine learning in products and services.
−Removed: Generally, we understand the use of AI for employee productivity also presents emerging ethical and social issues and may draw public scrutiny or controversy, and may also create or assist in producing output that appear correct but are factually inaccurate, incomplete, misleading, biased, or otherwise flawed, or produce other discriminatory or unexpected results, errors, or inadequacies, any of which may not be easily detectable.
+Added: Additionally, several states and localities have enacted measures related to the use of AI and machine learning in products and services.
+Added: Generally, we understand the use of AI for employee productivity also presents emerging ethical, privacy, and social issues and may draw public scrutiny or controversy, and may also create or assist in producing output that appear correct but are factually inaccurate, incomplete, misleading, biased, or otherwise flawed, or produce other discriminatory or unexpected results, errors or inadequacies, any of which may not be easily detectable.
These circumstances and 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.
Outside the United States, an increasing number of laws, regulations, industry standards and other obligations may govern privacy, data protection and security.
−Removed: 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.
−Removed: 13,709/2018), and China’s Personal Information Protection Law (“PIPL”) impose strict requirements for processing personal data.
+Added: For example, the European Union’s General Data Protection Regulation, or EU GDPR, the United Kingdom’s General Data Protection Regulation, or UK GDPR, Brazil’s General Data Protection Law and China’s Personal Information Protection Law, or PIPL, impose strict requirements for processing personal data.
For example, under the EU GDPR, companies may face temporary or definitive bans on data processing and other corrective actions;
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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.
−Removed: Additionally, we also target customers in Asia and may be subject to new and emerging data protection and 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: Additionally, we also target customers in Asia and may be subject to existing and emerging data protection and privacy regimes in Asia, including China’s PIPL, Japan’s Act on the Protection of Personal Information, and Singapore’s Personal Data Protection Act.
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.
Europe and other jurisdictions have enacted laws requiring data to be localized or limiting the transfer of personal data to other countries.
−Removed: In particular, the European Economic Area (“EEA”) and the United Kingdom (“UK”) each has significantly restricted the transfer of personal data to the United States and other countries whose privacy laws it believes are inadequate.
+Added: In particular, the European Economic Area, or EEA, and the UK each has significantly restricted the transfer of personal data to the United States and other countries whose privacy laws it believes are inadequate.
Other jurisdictions may adopt similarly stringent interpretations of their data localization and cross-border data transfer laws.
Although various mechanisms may be used to transfer personal data from the EEA and UK to the United States in compliance with law, such as the EEA’s and UK’s respective standard contractual clauses, the EU-U.S.
−Removed: Data Privacy Framework, the United Kingdom extension to the EU-U.S.
+Added: Data Privacy Framework, the UK extension to the EU-U.S.
Data Privacy Framework, and the Swiss-U.S.
−Removed: Data Privacy Framework, 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.
−Removed: 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 transferring or other processing of personal data necessary to operate our business.
+Added: Data Privacy Framework, these
+Added: 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: Particularly given our significant and growing presence in the UK and the EEA, 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 transferring or other processing of personal data necessary to operate our business.
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.
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We are also bound by other contractual obligations related to privacy, data protection and security, and our efforts to comply with such obligations may not be successful.
−Removed: For example, certain laws
−Removed: addressing privacy, data protection and security, such as the EU GDPR, Switzerland Federal Act on Data Protection (FADP), UK GDPR and CCPA, require our customers to impose specific contractual restrictions on their service providers.
+Added: For example, certain laws addressing privacy, data protection and security, such as the EU GDPR, Switzerland Federal Act on Data Protection, UK GDPR and CCPA, require our customers to impose specific contractual restrictions on their service providers.
Additionally, some of our customers may require us to host personal data locally.
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Additionally, these obligations may be subject to differing applications and interpretations, which may be inconsistent or conflict among jurisdictions.
−Removed: 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: Preparing for and complying with these obligations requires us to devote significant resources and may necessitate changes to our services, information technologies, systems, data processing activities and practices and to those of any third parties that process personal data on our behalf.
We may at times fail, or be perceived to have failed, in our efforts to comply with our privacy, data protection or security obligations.
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Further, existing tax laws, statutes, rules, regulations or ordinances could be interpreted, changed, modified or applied adversely to us.
−Removed: For example, in August 2022, as part of the Inflation Reduction Act of 2022, the United States enacted a 1% excise tax on stock buybacks and a 15% alternative minimum tax on adjusted financial statement income.
−Removed: Additionally, beginning in 2022, the Code eliminated the right to deduct research and development expenditures and instead requires taxpayers to capitalize and amortize U.S.
−Removed: and foreign research and development expenditures over
−Removed: five and 15 tax years, respectively.
−Removed: To the extent applicable, we have accounted for these changes in accordance with our understanding of the guidance available as of the date of this filing and as described in more detail in our financial statements.
+Added: For example, in 2025, President Trump signed into law the One Big Beautiful Bill Act, or OBBBA, which made significant changes to U.S.
+Added: federal income tax law.
+Added: The OBBBA made permanent many provisions of the Tax Cuts and Jobs Act of 2017, including the immediate expensing of domestic research and experimental expenditures and 100% bonus deprecation for qualified property acquired and placed in service after January 19, 2025.
+Added: In addition, future Treasury and regulatory guidance related to the implementation of the OBBBA may change or clarify the application of these rules in material ways.
Many countries, as well as organizations such as the Organization for Economic Cooperation and Development, have implemented or proposed changes to existing tax laws, including a 15% global minimum tax.
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Risks Related to our Intellectual Property
−Removed: 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 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 our rights to use key technologies to develop and operate our business.
−Removed: 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, or the Universities.
−Removed: Pursuant to the license agreement with the Universities, we were granted an exclusive, worldwide, royalty-free, sublicensable license for certain patents, know-how (on a non-exclusive basis) and other intellectual property to develop, manufacture and commercialize products for use in certain licensed fields, the scope of which includes the application of the licensed intellectual property in ion trap quantum computing.
−Removed: Our existing license agreement with the Universities imposes, and we expect that any future license agreements will impose, upon us various commercial and development obligations.
−Removed: If we fail to comply with our obligations under these agreements, or we are subject to an insolvency-related event, the licensor may have the right to terminate these agreements, in which event we would not be able to develop, market or otherwise commercialize products covered by these agreements, including if any of the foregoing were to occur with respect to our license agreement with the Universities.
−Removed: 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, 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 susceptible to multiple interpretations.
−Removed: Disputes may arise between us and our licensors regarding intellectual property subject to a license agreement, including:
−Removed: • the scope of rights granted under the license agreement and other interpretation-related issues;
−Removed: • whether and the extent to which our technology and processes infringe on intellectual property of the licensor that is not subject to the licensing agreement;
−Removed: • our right to sublicense patent and other rights to third parties;
−Removed: • our diligence obligations with respect to the use of the licensed technology in relation to our development and commercialization of our product and technology, and what activities satisfy those diligence obligations;
−Removed: • the ownership of inventions and know-how resulting from the joint creation or use of intellectual property by our licensors and the company;
−Removed: • our right to transfer or assign the license;
−Removed: • the effects of termination.
−Removed: The resolution of any contract interpretation disagreement that may arise could narrow what we believe to be the scope of our rights to the relevant intellectual property or technology, or increase what we believe to be our financial or other obligations under the relevant agreement, either of which could harm our business, financial condition and results of operations.
−Removed: Moreover, if disputes over intellectual property that we have licensed prevent or impair our ability to maintain our current licensing arrangements on acceptable terms, we may be unable to successfully develop and commercialize our products or technology.
−Removed: While we would expect to exercise all rights and remedies available to us, including seeking to cure any breach by us, and otherwise seek to preserve our rights under the license agreement, we may not be able to do so in a timely manner, at an acceptable cost or at all.
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.
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Failure to adequately protect our intellectual property rights could result in our competitors using our intellectual property to offer products, potentially resulting in the loss of some of our competitive advantage and a decrease in our revenue, which would adversely affect our business, financial condition and operating results.
+Added: In addition to our owned patent portfolio, we have licenses from third parties that are important or necessary for certain of our products.
+Added: If we fail to comply with our obligations under our license agreements, or we are subject to an insolvency-related event, the licensor may have the right to terminate these agreements, and if we were to lose the rights granted under those agreements, it could
+Added: materially impact products that benefit from those licenses.
+Added: As a result, the loss of our current licenses, breach by our licensor counterparties or failure to obtain necessary licenses on acceptable terms could have a material impact on our business.
Our patent applications may not result in issued patents or our patent rights may be contested, circumvented, invalidated or limited in scope, any of which could have a material adverse effect on our ability to prevent others from interfering with our commercialization of our products.
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patents will be issued.
−Removed: Even if our patent applications succeed and we are issued patents in accordance with them, it is still uncertain whether these patents – including any of the issued patents exclusively licensed to us – will be contested, circumvented, invalidated, found to be unenforceable or limited in scope in the future.
+Added: Even if our patent applications succeed and we are issued patents in accordance with them, it is still uncertain whether these patents – including any issued patents exclusively licensed to us – will be contested, circumvented, invalidated, found to be unenforceable or limited in scope in the future.
The rights granted under any issued patents may not provide us with meaningful protection or competitive advantages, and some foreign countries provide significantly less effective patent enforcement than in the United States.
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In addition, patents issued to us may be infringed upon or designed around by others and others may obtain patents that we need to license or design around, either of which would increase costs and may adversely affect our business, prospects, financial condition and operating results.
−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
−Removed: 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 (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.
We may become subject to intellectual property disputes.
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Any litigation may also involve patent holding companies or other adverse patent owners that have no relevant solution revenue, and therefore, our patent portfolio may provide little or no deterrence as we would not be able to assert our patents against such entities or individuals.
−Removed: If a third party is able to obtain an injunction preventing us from accessing such third-party intellectual property rights, or if we cannot license or develop alternative technology for any infringing aspect of our business, we may be forced to limit or stop sales of our products, services or technologies or cease business activities related to such intellectual property.
+Added: If a third party is able to obtain an injunction preventing us from accessing such third-party intellectual property rights, or if we cannot license
+Added: or develop alternative technology for any infringing aspect of our business, we may be forced to limit or stop sales of our products, services or technologies or cease business activities related to such intellectual property.
Although we carry general liability insurance, our insurance may not cover potential claims of this type or may not be adequate to indemnify us for all liability that may be imposed.
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Accordingly, our exposure to damages resulting from infringement claims could increase and this could further exhaust our financial and management resources.
−Removed: 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 covered by 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.
−Removed: manufacturers.
−Removed: Certain intellectual property rights that have been in-licensed pursuant to the license agreement with the Universities have been generated through the use of U.S.
−Removed: government funding and are therefore subject to certain federal regulations.
−Removed: As a result, the U.S.
−Removed: government may have certain rights to intellectual property embodied in our current or future product candidates pursuant to the Bayh-Dole Act of 1980, or the Patent and Trademark Law Amendment.
−Removed: government rights include a non-exclusive, non-transferable, irrevocable worldwide license to use inventions for any governmental purpose.
−Removed: In addition, the U.S.
−Removed: government has the right, under certain limited circumstances, to require the licensor to grant exclusive, partially exclusive or non-exclusive licenses to any of these inventions to a third party if it determines that:
−Removed: (1) adequate steps have not been taken to commercialize the invention, (2) government action is necessary to meet public health or safety needs or (3) government action is necessary to meet requirements for public use under federal regulations (also referred to as “march-in rights”).
−Removed: government also has the right to take title to these inventions if the licensor fails to disclose the invention to the government or fails to file an application to register the intellectual property within specified time limits.
−Removed: Intellectual property generated under a government funded program is also subject to certain reporting requirements, compliance with which may require us to expend substantial resources.
−Removed: In addition, the U.S.
−Removed: government requires that any products embodying any of these inventions or produced through the use of any of these inventions be manufactured substantially in the U.S., and the license agreement with the Universities requires that we comply with this requirement.
−Removed: This preference for U.S.
−Removed: industry may be waived by the federal agency that provided the funding if the owner or assignee of the intellectual property can show that reasonable but unsuccessful efforts have been made to grant licenses on similar terms to potential licensees that would be likely to manufacture the products substantially in the United States or that under the circumstances domestic manufacture is not commercially feasible.
−Removed: To the extent any of our owned or licensed future intellectual property is also generated through the use of U.S.
−Removed: government funding, the provisions of the Bayh-Dole Act may similarly apply.
Risks Related to an Investment in our Securities and Other General Matters
6 unchanged sentences
Our operating results could be below the expectations of public market analysts and investors due to a number of potential factors, including:
−Removed: • variations in quarterly operating results or dividends, if any, to stockholders;
+Added: • variations in quarterly operating results;
• additions or departures of key management personnel;
3 unchanged sentences
• changes or proposed changes in laws or regulations or differing interpretations or enforcement of laws or regulations affecting our business;
−Removed: • adverse market reaction to any indebtedness incurred or securities issued in the future;
+Added: • adverse market reaction to any indebtedness incurred or securities issued in the future, or to acquisitions, investments, partnerships or other strategic transactions that we announce;
• changes in market valuations of similar companies;
2 unchanged sentences
• the impact of any of the foregoing on our management, employees, partners, customers, and operating results.
−Removed: 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 could result in substantial costs and a diversion of
−Removed: management’s attention and resources.
+Added: 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 the company, and we have experienced such litigation ourselves.
+Added: Such litigation could result in substantial costs and a diversion of management’s attention and resources.
See also “ —Risks Related to Litigation and Government Regulation—Our business is exposed to risks associated with litigation, investigations and regulatory proceedings .”
18 unchanged sentences
• lengthy customer sales cycle, leading to difficulty in forecasting the timing of purchasing decisions;
−Removed: • expansion to new markets;
+Added: • expansion to new markets or the acquisition of new businesses;
• fluctuations in commodity prices.
5 unchanged sentences
Short selling reports can cause increased volatility in an issuer’s stock price, and result in regulatory and governmental inquiries.
−Removed: On May 3, 2022, a short seller report was published about us, which contained certain allegations against us.
+Added: From time to time, short seller reports have been published about us, which contain certain allegations against us.
Any inquiry or formal investigation from a governmental organization or other regulatory body, including any inquiry from the SEC or the U.S.
4 unchanged sentences
We cannot be certain when or if the operations of our business will generate sufficient cash to fund our ongoing operations or the growth of our business.
−Removed: We intend to make investments to support our current business and may require additional funds to
−Removed: respond to business challenges, including the need to develop or enhance our technology, improve our operating infrastructure or acquire complementary businesses and technologies.
+Added: We intend to make investments to support our current business and may require additional funds to respond to business challenges, including the need to develop or enhance our technology, improve our operating infrastructure or acquire complementary businesses and technologies.
Additional financing may not be available on favorable terms, if at all.
In addition, we may not be able to access a portion of our existing cash, cash equivalents and investments due to market conditions.
−Removed: For example, on March 10, 2023, the Federal Deposit Insurance Corporation (“FDIC”) took control and was appointed receiver of Silicon Valley Bank (“SVB”).
−Removed: Similarly, on March 12, 2023, Signature Bank and Silvergate Capital Corp.
−Removed: were each swept into receivership.
−Removed: 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: If 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 we could experience a material adverse effect on our business and financial condition.
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.
3 unchanged sentences
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.
−Removed: 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.
+Added: Because the decision to issue securities in any 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.
As a result, stockholders will bear the risk of future issuances of debt or equity securities reducing the value of their common stock and diluting their interest.
−Removed: There can be no assurance that we will be able to comply with the continued listing standards of the New York Stock Exchange (“NYSE”).
+Added: There can be no assurance that we will be able to comply with the continued listing standards of the New York Stock Exchange, or NYSE.
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.
14 unchanged sentences
We face increased legal, accounting, insurance, administrative and other costs and expenses as a public 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 Public Company Accounting Oversight Board (“PCAOB”) and the securities exchanges, impose additional reporting
−Removed: and other obligations on public companies.
+Added: Sarbanes-Oxley, including the requirements of Section 404, as well as rules and regulations subsequently implemented by the SEC, the Dodd-Frank Act and the rules and regulations promulgated and to be promulgated thereunder, including conflict minerals disclosure requirements, the Public Company Accounting Oversight Board and the securities exchanges, impose additional reporting and other obligations on public companies.
Compliance with public company requirements will continue to increase costs and make certain activities more time-consuming.
10 unchanged sentences
The issuance of additional shares or other equity securities of equal or senior rank would have the following effects:
−Removed: • existing stockholders’ proportionate ownership interest in us will decrease;
−Removed: • the amount of cash available per share, including for payment of dividends, if any, may decrease;
−Removed: • the relative voting strength of each previously outstanding share of common stock may be diminished;
+Added: • existing stockholders’ proportionate ownership interest in us would decrease;
+Added: • the amount of cash available per share would decrease;
+Added: • the relative voting strength of each previously outstanding share of common stock would be diminished;
• the market price of our common stock may decline.
11 unchanged sentences
We have the ability to redeem outstanding public warrants prior to their expiration, at a price of $0.01 per warrant, provided that the last reported sales price of our common stock equals or exceeds $18.00 per share (as adjusted for stock splits, stock dividends, reorganizations, recapitalizations and the like) for any 20 trading days within a 30-trading day period ending on the third trading day prior to the date on which we give proper notice of such redemption and provided certain other conditions are met.
−Removed: While the public
−Removed: warrants are 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.
+Added: While the public warrants are 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.
Redemption of the outstanding public warrants could force you (1) to exercise your public warrants and pay the exercise price 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.
10 unchanged sentences
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.
+Added: Our certificate of incorporation, which we refer to as our Charter, and bylaws, which we refer to as our 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.
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:
−Removed: • a classified board;
+Added: • a classified board of directors;
• advance notice for nominations of directors by stockholders and for stockholders to include matters to be considered at our annual meetings;
• certain limitations on convening special stockholder meetings;
−Removed: • limiting the persons who may call special meetings of stockholders;
−Removed: • limiting the ability of stockholders to act by written consent;
−Removed: • restrictions on business combinations with an interested stockholder;
−Removed: • in certain cases, the approval of holders representing at least 66 2/3% of the total voting power of the shares entitled to vote generally in the election of directors will be required for stockholders to adopt, amend or repeal the Bylaws, or amend or repeal certain provisions of the Certificate of Incorporation;
+Added: • certain limitations on the persons who may call special meetings of stockholders;
+Added: • certain limitations on the ability of stockholders to act by written consent;
+Added: • certain restrictions on business combinations with an interested stockholder;
+Added: • in certain cases, the approval of holders representing at least 66 2/3% of the total voting power of the shares entitled to vote generally in the election of directors being required for stockholders to adopt, amend or repeal the Bylaws, or amend or repeal certain provisions of the Certificate of Incorporation;
• no cumulative voting;
1 unchanged sentence
• 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.
−Removed: 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.
−Removed: The provision of our Certificate of Incorporation requiring exclusive venue in the Court of Chancery in the State of Delaware and the federal district courts of the United States for certain types of lawsuits may have the effect of discouraging lawsuits against directors and officers.
−Removed: Our Certificate of Incorporation provides that, unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware shall be the sole and exclusive forum for:
+Added: These provisions of our Charter 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.
+Added: The provision of our Charter requiring exclusive venue in the Court of Chancery in the State of Delaware and the federal district courts of the United States for certain types of lawsuits may have the effect of discouraging lawsuits against directors and officers.
+Added: Our Charter provides that, unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware (or, if and only if that court lacks subject matter jurisdiction, then any state court located within the State of Delaware or, if and only if all such state courts lack subject matter jurisdiction, then the United States District Court for the District of Delaware) will be the sole and exclusive forum for:
• any derivative action or proceeding brought on behalf of us;
• any action asserting a claim of breach of fiduciary duty owed by any director, officer, agent or other employee or stockholder to us or our stockholders;
−Removed: • any action asserting a claim arising pursuant to any provision of the Delaware General Corporation Law (the “DGCL”), the Certificate of Incorporation or Bylaws or as to which the DGCL confers jurisdiction on the Court of Chancery of the State of Delaware;
−Removed: • any claim or cause of action seeking to interpret, apply, enforce or determine the validity of the Certificate of Incorporation or the Bylaws;
+Added: • any action asserting a claim arising pursuant to any provision of the Delaware General Corporation Law, or the DGCL, the Charter or Bylaws or as to which the DGCL confers jurisdiction on the Court of Chancery of the State of Delaware;
+Added: • any claim or cause of action seeking to interpret, apply, enforce or determine the validity of the Charter or the Bylaws;
• any action asserting a claim governed by the internal affairs doctrine, in each case subject to such Court of Chancery having personal jurisdiction over the indispensable parties named as defendants therein.
−Removed: 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 Exchange Act, or any other claim for which the federal courts have exclusive jurisdiction.
+Added: The Charter 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.
+Added: The exclusive forum clauses described above do not apply to suits brought to enforce a duty or liability created by the Securities Exchange Act of 1934, as amended, or any other claim for which the federal courts have exclusive 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.
1 unchanged sentence
In addition, investors cannot waive compliance with the federal securities laws and the rules and regulations thereunder.
−Removed: 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.
+Added: 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 Charter to be inapplicable or unenforceable in such action.
If so, we may incur additional costs associated with resolving such action in other jurisdictions, which could harm our business, financial condition or results of operations.
−Removed: These provisions of our Certificate of Incorporation and Bylaws could discourage lawsuits against directors and officers, which could reduce the market price of our common stock.
+Added: These provisions of our Charter and Bylaws could discourage lawsuits against directors and officers, which could reduce the market price of our common stock.
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.