What changed in this filing

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Item 1A. Risk Factors

2023-03-30 compared with 2022-03-28 · 1884 added, 2036 removed, 48 unchanged (99% of the section changed)

Investing in our common stock involves a high

degree of risk.

You should consider carefully the risks and uncertainties described below, together with all of the other information

contained in this annual report, before deciding to invest in our common stock.

If any of the following risks materialize, our business,

financial condition, results of operation and prospects will likely be materially and adversely affected.

In that event, the market price

of our common stock could decline and you could lose all or part of your investment.

Risks Related to Our Company

Our acquisition of assets of Excel and its

subsidiaries Payprotec Oregon, LLC, Excel Business Solutions, Inc.

in our common stock involves a high degree of risk.

You should consider carefully the risks and uncertainties described below, together

with all of the other information contained in this annual report, before deciding to invest in our common stock.

If any of the following

risks materialize, our business, financial condition, results of operation and prospects will likely be materially and adversely affected.

In that event, the market price of our common stock could decline and you could lose all or part of your investment.

Related to Our Company

acquisition of assets of Excel and its subsidiaries Payprotec Oregon, LLC, Excel Business Solutions, Inc.

and eVance Processing, Inc.

and share exchange with OmniSoft and CrowdPay

has collectively formed a new business platform which we are continuing to integrate into our overall operations, and which may create

certain risks and may adversely affect our business, financial condition or results of operations.

On April 9, 2018, we acquired substantially all

of the assets of Excel and its subsidiaries Payprotec Oregon, LLC, Excel Business Solutions, Inc.

and share exchange with OmniSoft and CrowdPay has collectively formed a new business platform which we are continuing to integrate into

our overall operations, and which may create certain risks and may adversely affect our business, financial condition or results of operations.

April 9, 2018, we acquired substantially all of the assets of Excel and its subsidiaries Payprotec Oregon, LLC, Excel Business Solutions,

and eVance Processing, Inc.

million through a foreclosure sale conducted under the Uniform Commercial Code of the State of New York (“Asset Acquisition”).

Since closing the Asset Acquisition, we have been in the process of integrating our operations with the acquired assets.

On May 9, 2018, we entered into separate share

exchange agreements with the stockholders of OmniSoft and CrowdPay, affiliate companies of our company’s majority stockholder.

to the share exchange agreement with OmniSoft, the stockholders of OmniSoft transferred to us all of the issued and outstanding shares

of OmniSoft common stock in exchange for an aggregate of 1,833,333 shares of our common stock.

Pursuant to the share exchange agreement

with CrowdPay, the stockholders of CrowdPay transferred to us all of the issued and outstanding shares of CrowdPay common stock in exchange

for an aggregate of 2,916,667 shares of our common stock.

The share exchange transactions closed on May 9, 2018, on which date OmniSoft

and CrowdPay became wholly owned subsidiaries of the Company (the “Share Exchange”).

Since the consummation of the Asset Acquisition

and the Share Exchange, we have a limited history upon which an evaluation of our performance and future prospects can be made.

and proposed operations are subject to all the business risks associated with new enterprises.

These include likely fluctuations in operating

results as we manage our growth and react to competitors and developments in the markets in which we compete.

As we can be considered

an early stage company and have not yet generated any profits, there is no assurance that we will be profitable in the near term or generate

sufficient revenues to meet our capital requirements.

As a result, we may experience interruptions of,

or loss of momentum in, the activities of one or more of our combined businesses and the possible loss of key personnel.

The diversion

of our management’s attention and any delays or difficulties encountered in connection with the integration of Excel could adversely

affect our business, financial condition or results of operations.

The substantial and continuing losses, and

significant operating expenses incurred in the past few years may cause us to be unable to pursue all of our operational objectives if

sufficient financing and/or additional cash from revenues is not realized.

We have limited cash resources and operating losses

throughout our history.

As of December 31, 2021 we had a working capital of $1,834,452 and a net loss of $4,978,358.

Our cash flow provided

by operating activities for the year ended December 31, 2021 was $3,508,082.

Notwithstanding the foregoing, management has concluded that

it has sufficient liquidity to continue operations for a period of at least twelve months from the date of this Annual Report, which conclusion

would not have been possible without close monitoring of the Company’s projected cash flow and operating expenses for a period of

at least the next twelve months.

In considering the anticipated impact of the COVID-19

pandemic on the Company’s business, the Company does not anticipate that the pandemic will have a material impact on the Company’s

business or liquidity and believes that it will be able fund future liquidity and capital requirements through cash flows generated from

its operating activities for a period of at least twelve months from the date of this Annual Report (see “Management’s Discussion

and Analysis of Financial Condition and Results of Operations).

However, any additional closings and reopenings of businesses in the future

will likely result in a month over month decline and then increase similar to what occurred in March through June 2020.

If there are unanticipated expenses, insufficient

cash from operations or the impact of the COVID-19 pandemic, including but not limited to losses arising from a second wave of businesses

closing in response to the ongoing pandemic, which results in a larger than anticipated decline in transactions, we may not be able to

attract financing as needed, or if available, on reasonable terms as required and therefore may not be able to accomplish our business

goals or repay certain of our debts.

Further, the terms of any such financing may be dilutive to existing stockholders or otherwise on

terms not favorable to us or existing stockholders.

If we are unable to secure financing, as circumstances require, or do not succeed

in meeting our sales objectives, we may be required to change, significantly reduce our operations or ultimately may not be able to continue

our operations and there will be substantial doubt as to our ability to continue as a going concern.

We have historically relied on related parties

and affiliates to finance our operations, but there is no guarantee that these parties will continue to finance our operations in the

While we will be able to fund future liquidity

and capital requirements through cash flows generated from our operating activities alone for a period of twelve months, we previously

have financed our operations from short-term loans from Ronny Yakov, our Chief Executive Officer and John Herzog, a significant shareholder

of the Company.

for $12.5 million through a foreclosure sale conducted under the Uniform Commercial Code of the State

of New York (“Asset Acquisition”).

Since closing the Asset Acquisition, we have been in the process of integrating our operations

with the acquired assets.

May 9, 2018, we entered into separate share exchange agreements with the stockholders of OmniSoft and CrowdPay, affiliate companies of

our company’s majority stockholder.

Pursuant to the share exchange agreement with OmniSoft, the stockholders of OmniSoft transferred

to us all of the issued and outstanding shares of OmniSoft common stock in exchange for an aggregate of 1,833,333 shares of our common

Pursuant to the share exchange agreement with CrowdPay, the stockholders of CrowdPay transferred to us all of the issued and outstanding

shares of CrowdPay common stock in exchange for an aggregate of 2,916,667 shares of our common stock.

The share exchange transactions

closed on May 9, 2018, on which date OmniSoft and CrowdPay became wholly owned subsidiaries of the Company (the “Share Exchange”).

the consummation of the Asset Acquisition and the Share Exchange, we have a limited history upon which an evaluation of our performance

and future prospects can be made.

Our current and proposed operations are subject to all the business risks associated with new enterprises.

These include likely fluctuations in operating results as we manage our growth and react to competitors and developments in the markets

in which we compete.

As we can be considered an early stage company and have not yet generated any profits, there is no assurance that

we will be profitable in the near term or generate sufficient revenues to meet our capital requirements.

a result, we may experience interruptions of, or loss of momentum in, the activities of one or more of our combined businesses and the

possible loss of key personnel.

The diversion of our management’s attention and any delays or difficulties encountered in connection

with the integration of Excel could adversely affect our business, financial condition or results of operations.

substantial and continuing losses, and significant operating expenses incurred in the past few years may cause us to be unable to pursue

all of our operational objectives if sufficient financing and/or additional cash from revenues is not realized.

We have limited cash resources and operating losses throughout our

As of December 31, 2022 we had a working capital deficit of $64,503 and a net loss of $7,974,168 .

Our cash flow used by operating

activities for the year ended December 31, 2022 was $1,921,381.

Notwithstanding the foregoing, management has concluded that it has sufficient

liquidity to continue operations for a period of at least twelve months from the date of this Annual Report, which conclusion would not

have been possible without close monitoring of the Company’s projected cash flow and operating expenses for a period of at least

the next twelve months.

considering the anticipated impact of the COVID-19 pandemic on the Company’s business, the Company does not anticipate that the

pandemic will have a material impact on the Company’s business or liquidity and believes that it will be able fund future liquidity

and capital requirements through cash flows generated from its operating activities for a period of at least twelve months from the date

of this Annual Report (see “Management’s Discussion and Analysis of Financial Condition and Results of Operations).

any additional closings and reopenings of businesses in the future will likely result in a month over month decline and then increase

similar to what occurred in March through June 2020.

there are unanticipated expenses, insufficient cash from operations or the impact of the COVID-19 pandemic, including but not limited

to losses arising from a second wave of businesses closing in response to the ongoing pandemic, which results in a larger than anticipated

decline in transactions, we may not be able to attract financing as needed, or if available, on reasonable terms as required and therefore

may not be able to accomplish our business goals or repay certain of our debts.

Further, the terms of any such financing may be dilutive

to existing stockholders or otherwise on terms not favorable to us or existing stockholders.

If we are unable to secure financing, as

circumstances require, or do not succeed in meeting our sales objectives, we may be required to change, significantly reduce our operations

or ultimately may not be able to continue our operations and there will be substantial doubt as to our ability to continue as a going

have historically relied on related parties and affiliates to finance our operations, but there is no guarantee that these parties will

continue to finance our operations in the future.

we will be able to fund future liquidity and capital requirements through cash flows generated from our operating activities alone for

a period of twelve months, we previously have financed our operations from short-term loans from Ronny Yakov, our Chief Executive Officer

and John Herzog, a significant shareholder of the Company.

It is not assured that Mr.

Herzog would continue to provide such assistance if the Company were to require

it in the future.

We may be subject to liabilities arising

prior to the Asset Acquisition under certain “successor liability” theories.

We acquired our business by means of a foreclosure

of the relevant secured lender’s security interest in the assets in the Asset Acquisition through an auction under Article 9 of

the Uniform Commercial Code.

Although the general rule in the context of transactions such as the Asset Acquisition is that a purchaser

of assets does not assume the seller’s liabilities, various courts have established exceptions to this general rule, including

where the purchaser is a ‘mere continuation’ of the seller and there is a ‘continuity of enterprise.’ To date,

we have had one lawsuit whereby we have been found to have successor liability.

However, we are currently appealing the decision.

is a highly fact specific inquiry, and there can be no assurance that any interested creditor, the United States (through the Internal

Revenue Service) or state or local taxing agencies will not seek to hold us responsible for any existing liabilities at the time of the

Asset Acquisition under one or more of these successor liability theories, for which we have no indemnification protection under the

agreements relating to the Asset Acquisition.

We operate in a complex regulatory environment,

and failure to comply with applicable laws and regulations could adversely affect our business.

Our operations are subject to a broad range of

complex and evolving laws and regulations.

As a result, we must perform our services in compliance with the legal and regulatory requirements

of multiple jurisdictions.

Some of these laws and regulations may be difficult to ascertain or interpret and may change from time to time.

Violation of such laws and regulations could subject us to fines and penalties, damage our reputation, constitute a breach of our client

agreements, impair our ability to obtain and renew required licenses, and decrease our profitability or competitiveness.

If any of these

effects were to occur, our operating results and financial condition could be adversely affected.

We may not be able to integrate new technologies

and provide new services in a cost-efficient manner.

The online E-commerce industry is subject to rapid

and significant changes in technology, frequent new service introductions and evolving industry standards.

We cannot predict the effect

of these changes on our competitive position, our profitability or the industry generally.

Technological developments may reduce the competitiveness

of our networks and our software solutions and require additional capital expenditures or the procurement of additional products that

could be expensive and time consuming.

In addition, new products and services arising out of technological developments may reduce the

attractiveness of our services.

If we fail to adapt successfully to technological advances or fail to obtain access to new technologies,

we could lose customers and be limited in our ability to attract new customers and/or sell new services to our existing customers.

addition, delivery of new services in a cost-efficient manner depends upon many factors, and we may not generate anticipated revenue from

such services.

Disruptions in our networks and infrastructure

may result in customer dissatisfaction, customer loss or both, which could materially and adversely affect our reputation and business.

Our systems are an integral part of our customers’

business operations.

It is critical for our customers, that our systems provide a continued and uninterrupted performance.

Customers may

be dissatisfied by any system failure that interrupts our ability to provide services to them.

Sustained or repeated system failures would

reduce the attractiveness of our services significantly and could result in decreased demand for our services.

We face the following risks to our networks, infrastructure

and software applications:

our territory can have significant weather events which physically damage access lines;

power surges and outages, computer viruses or hacking, earthquakes, terrorism attacks, vandalism and software or hardware defects which are beyond our control;

Unusual spikes in demand or capacity limitations in our or our suppliers’ networks.

Disruptions may cause interruptions in service

or reduced capacity for customers, either of which could cause us to lose customers and/or incur expenses, and thereby adversely affect

our business, revenue and cash flow.

Our positioning in the marketplace as a

smaller provider places a significant strain on our resources, and if not managed effectively, could result in operational inefficiencies

and other difficulties.

Our positioning in the marketplace may place a

significant strain on our management, operational and financial resources, and increase demand on our systems and controls.

this position effectively, we must continue to implement and improve our operational and financial systems and controls, invest in development

and engineering, critical systems and network infrastructure to maintain or improve our service quality levels, purchase and utilize other

systems and solutions, and train and manage our employee base.

As we proceed with our development, operational difficulties could arise

from additional demand placed on customer provisioning and support, billing and management information systems, product delivery and fulfilment,

sales and marketing and administrative resources.

For instance, we may encounter delays or cost

overruns or suffer other adverse consequences in implementing new systems when required.

In addition, our operating and financial control

systems and infrastructure could be inadequate to ensure timely and accurate financial reporting.

We must attract and retain skilled personnel.

If we are unable to hire and retain technical, technical sales and operational employees, our business could be harmed.

Our ability to integrate our acquired assets and

to grow will be particularly dependent on our ability to hire, develop and retain an effective sales force and qualified technical and

managerial personnel.

We need software development specialists with in-depth knowledge of a blend of IT and telecommunications or with

a blend of security and telecom.

We intend to hire additional necessary employees, including software engineers, communication engineers,

project managers, sales consultants, employees and operational employees, on a permanent basis.

The competition for qualified technical

sales, technical, and managerial personnel in the communications and software industry is intense in the markets where we operate, and

we may not be able to hire and retain sufficient qualified personnel.

In addition, we may not be able to maintain the quality of our operations,

control our costs, maintain compliance with all applicable regulations, and expand our internal management, technical, information and

accounting systems in order to support our desired growth, which could have an adverse impact on our operations.

Volatility in the stock

market and other factors could diminish our use, and the value, of our equity awards as incentives to employees, putting us at a competitive

disadvantage or forcing us to use more cash compensation.

We are dependent on the continued services

and performance of our senior management and other key employees, the loss of any of whom could adversely affect our business, operating

results and financial condition.

Our future performance depends on the continued

services and contributions of our senior management, including our Chief Executive Officer, Ronny Yakov, Vice President, Finance, Patrick

Smith and other key employees to execute on our business plan and to identify and pursue new opportunities and product innovations.

loss of services of senior management or other key employees could significantly delay or prevent the achievement of our strategic objectives.

In addition, some of the members of our current senior management team have only been working together for a short period of time, which

could adversely impact our ability to achieve our goals.

From time to time, there may be changes in our senior management team resulting

from the hiring or departure of executives, which could disrupt our business.

We do not maintain key person life insurance policies on

any of our employees other than a policy providing limited coverage on the life of our Chief Executive Officer.

The loss of the services

of one or more of our senior management or other key employees for any reason could adversely affect our business, financial condition

and operating results and require significant amounts of time, training and resources to find suitable replacements and integrate them

within our business, and could affect our corporate culture.

Our Chief Financial Officer is currently

employed on a part-time basis.

Given the size of the Company and our operational

needs, we initially hired our Chief Financial Officer, Rachel Boulds, on a part-time basis.

Herzog would continue to provide such

assistance if the Company were to require it in the future.

may be subject to liabilities arising prior to the Asset Acquisition under certain “successor liability” theories.

acquired our business by means of a foreclosure of the relevant secured lender’s security interest in the assets in the Asset Acquisition

through an auction under Article 9 of the Uniform Commercial Code.

Although the general rule in the context of transactions such as the

Asset Acquisition is that a purchaser of assets does not assume the seller’s liabilities, various courts have established exceptions

to this general rule, including where the purchaser is a ‘mere continuation’ of the seller and there is a ‘continuity

of enterprise.’ To date, we have had one lawsuit whereby we have been found to have successor liability.

However, we are currently

appealing the decision.

This is a highly fact specific inquiry, and there can be no assurance that any interested creditor, the United

States (through the Internal Revenue Service) or state or local taxing agencies will not seek to hold us responsible for any existing

liabilities at the time of the Asset Acquisition under one or more of these successor liability theories, for which we have no indemnification

protection under the agreements relating to the Asset Acquisition.

operate in a complex regulatory environment, and failure to comply with applicable laws and regulations could adversely affect our business.

operations are subject to a broad range of complex and evolving laws and regulations.

As a result, we must perform our services in compliance

with the legal and regulatory requirements of multiple jurisdictions.

Some of these laws and regulations may be difficult to ascertain

or interpret and may change from time to time.

Violation of such laws and regulations could subject us to fines and penalties, damage

our reputation, constitute a breach of our client agreements, impair our ability to obtain and renew required licenses, and decrease

our profitability or competitiveness.

If any of these effects were to occur, our operating results and financial condition could be adversely

may not be able to integrate new technologies and provide new services in a cost-efficient manner.

online E-commerce industry is subject to rapid and significant changes in technology, frequent new service introductions and evolving

industry standards.

We cannot predict the effect of these changes on our competitive position, our profitability or the industry generally.

Technological developments may reduce the competitiveness of our networks and our software solutions and require additional capital expenditures

or the procurement of additional products that could be expensive and time consuming.

In addition, new products and services arising

out of technological developments may reduce the attractiveness of our services.

If we fail to adapt successfully to technological advances

or fail to obtain access to new technologies, we could lose customers and be limited in our ability to attract new customers and/or sell

new services to our existing customers.

In addition, delivery of new services in a cost-efficient manner depends upon many factors, and

we may not generate anticipated revenue from such services.

in our networks and infrastructure may result in customer dissatisfaction, customer loss or both, which could materially and adversely

affect our reputation and business.

systems are an integral part of our customers’ business operations.

It is critical for our customers, that our systems provide

a continued and uninterrupted performance.

Customers may be dissatisfied by any system failure that interrupts our ability to provide

services to them.

Sustained or repeated system failures would reduce the attractiveness of our services significantly and could result

in decreased demand for our services.

face the following risks to our networks, infrastructure and software applications:

territory can have significant weather events which physically damage access lines;

surges and outages, computer viruses or hacking, earthquakes, terrorism attacks, vandalism and software or hardware defects which are

beyond our control;

spikes in demand or capacity limitations in our or our suppliers’ networks.

may cause interruptions in service or reduced capacity for customers, either of which could cause us to lose customers and/or incur expenses,

and thereby adversely affect our business, revenue and cash flow.

positioning in the marketplace as a smaller provider places a significant strain on our resources, and if not managed effectively, could

result in operational inefficiencies and other difficulties.

positioning in the marketplace may place a significant strain on our management, operational and financial resources, and increase demand

on our systems and controls.

To manage this position effectively, we must continue to implement and improve our operational and financial

systems and controls, invest in development and engineering, critical systems and network infrastructure to maintain or improve our service

quality levels, purchase and utilize other systems and solutions, and train and manage our employee base.

As we proceed with our development,

operational difficulties could arise from additional demand placed on customer provisioning and support, billing and management information

systems, product delivery and fulfilment, sales and marketing and administrative resources.

instance, we may encounter delays or cost overruns or suffer other adverse consequences in implementing new systems when required.

addition, our operating and financial control systems and infrastructure could be inadequate to ensure timely and accurate financial

must attract and retain skilled personnel.

If we are unable to hire and retain technical, technical sales and operational employees,

our business could be harmed.

ability to integrate our acquired assets and to grow will be particularly dependent on our ability to hire, develop and retain an effective

sales force and qualified technical and managerial personnel.

We need software development specialists with in-depth knowledge of a blend

of IT and telecommunications or with a blend of security and telecom.

We intend to hire additional necessary employees, including software

engineers, communication engineers, project managers, sales consultants, employees and operational employees, on a permanent basis.

competition for qualified technical sales, technical, and managerial personnel in the communications and software industry is intense

in the markets where we operate, and we may not be able to hire and retain sufficient qualified personnel.

In addition, we may not be

able to maintain the quality of our operations, control our costs, maintain compliance with all applicable regulations, and expand our

internal management, technical, information and accounting systems in order to support our desired growth, which could have an adverse

impact on our operations.

Volatility in the stock market and other factors could diminish our use, and the value, of our equity awards

as incentives to employees, putting us at a competitive disadvantage or forcing us to use more cash compensation.

are dependent on the continued services and performance of our senior management and other key employees, the loss of any of whom could

adversely affect our business, operating results and financial condition.

future performance depends on the continued services and contributions of our senior management, including our Chief Executive Officer,

Ronny Yakov, Vice President, Finance, Patrick Smith and other key employees to execute on our business plan and to identify and pursue

new opportunities and product innovations.

The loss of services of senior management or other key employees could significantly delay

or prevent the achievement of our strategic objectives.

In addition, some of the members of our current senior management team have only

been working together for a short period of time, which could adversely impact our ability to achieve our goals.

From time to time, there

may be changes in our senior management team resulting from the hiring or departure of executives, which could disrupt our business.

We do not maintain key person life insurance policies on any of our employees other than a policy providing limited coverage on the life

of our Chief Executive Officer.

The loss of the services of one or more of our senior management or other key employees for any reason

could adversely affect our business, financial condition and operating results and require significant amounts of time, training and

resources to find suitable replacements and integrate them within our business, and could affect our corporate culture.

Chief Financial Officer is currently employed on a part-time basis.

the size of the Company and our operational needs, we initially hired our Chief Financial Officer, Rachel Boulds, on a part-time basis.

While we have discussed with Ms.

possibility of becoming our full-time Chief Financial Officer, it is anticipated that Ms.

Boulds will continue to be employed on a part-time

basis for the next twelve months.

In addition to her role as Chief Financial Officer, Ms.

Boulds is also operating her solo accounting

practice providing services for clients unrelated to the Company.

While we believe that Ms.

Boulds currently devotes adequate time to

the Company to perform the role and duties of our Chief Financial Officer, we cannot guarantee that she will be able to continue to do

so until she is with the Company on a fulltime basis.

Boulds cannot devote adequate time to our Company to fulfil her role and

duties as Chief Financial Officer or if any conflicts of interest arise during this time, it could have a material adverse impact on our

Our success depends on our continued investment

in research and development, the level and effectiveness of which could reduce our profitability.

We intend to continue to make investments in research

and development and product development in seeking to sustain and improve our competitive position and meet our customers’ needs.

These investments currently include streamlining our suite of software functionalities, including modularization and improving scalability

of our integrated solutions.

To maintain our competitive position, we may need to increase our research and development investment, which

could reduce our profitability and cash flows.

In addition, we cannot assure you that we will achieve a return on these investments, nor

can we assure you that these investments will improve our competitive position or meet our

Risks Related to Our Business

CROWDPAY.US, INC.

We operate in a regulatory environment that

is evolving and uncertain.

The regulatory framework for online capital formation

or crowdfunding is very new.

The regulations that govern the companies and broker-dealers that utilize our platform and the investors

that find investment opportunities on our platform have been in existence for a very few years.

Further, there are constant discussions

among legislators and regulators with respect to changing this regulatory environment.

New laws and regulations could be adopted in the

United States and abroad.

Further, existing laws and regulations may be interpreted in ways that would impact our platform, including

our ability to communicate and work with investors, broker-dealers and the companies that use our platforms’ services.

over the past year, there have been several attempts to modify the current regulatory regime.

Some of those suggested reforms could make

it easier for anyone to sell securities (without using our platform), or could increase our regulatory burden, including requiring us

to register as a broker-dealer or funding portal before we choose to do so.

Any such changes would have a negative impact on our business.

In the event we are required or decide to

Under our current structure, we believe we are

not required to register as a broker-dealer or funding portal under federal and state laws.

Further, none of our officers has previous

experience in securities markets or regulations or has passed any related examinations or holds any accreditations.

We comply with the

rules surrounding funding portals and restrict our activities and services so as to not be deemed a broker-dealer under state and federal

However, if we were deemed by a relevant authority to be acting as a broker-dealer or a funding portal, we could be required

to register or be subject to a variety of penalties, including fines and rescission offers.

Further, we may decide for business reasons

or we may be required to register as a broker-dealer or a funding portal, which would increase our costs, especially our compliance costs.

If we are required but decide not to register as a broker-dealer or act in association with a broker-dealer in our transactions or to

We may be liable for misstatements made

by issuers on our platform.

Under the Securities Act and the Securities and

Exchange Act of 1934, as amended (the “Exchange Act”), issuers making offerings through our platform may be liable for including

untrue statements of material facts or for omitting information that could make the statements made misleading.

This liability may also

extend in Regulation Crowdfunding offerings to funding portals.

Even though we are not a registered funding portal, there can be no assurance

that if we were sued we would prevail.

Further, even if we do succeed, lawsuits are time consuming and expensive, and being a party to

such actions may cause us reputational harm that would negatively impact our business.

Our compliance is focused on U.S.

we have not analyzed foreign laws regarding the participation of non-U.S.

Some of the investment opportunities posted on

our platform are open to non-U.S.

We have not researched all the applicable foreign laws and regulations, and therefore we

have not set up our structure to be compliant with all those laws.

It is possible that we may be deemed in violation of those laws, which

could result in fines or penalties as well as reputational harm.

This may limit our ability in the future to assist companies in accessing

money from those investors, and compliance with those laws and regulation may limit our business operations and plans for future expansion.

The types of offerings that we expect to

be posted on our platform are relatively new in an industry that is still quickly evolving .

The principal types of offerings that are posted

on our platform are pursuant to Regulation A and Regulation Crowdfunding (CF) which have only been in effect in their current form since

2015 and 2016, respectively.

Our ability to penetrate the market to host these types of offerings remains uncertain as potential issuer

companies may choose to use different platforms or providers (including, in the case of Regulation A, using their own online platform),

or determine alternative methods of financing.

Investors may decide to invest their money elsewhere.

Further, our potential market may

not be as large, or our industry may not grow as rapidly, as anticipated.

With a smaller market than expected, we may have fewer customers.

Success will likely be a factor of investing in the development and implementation of marketing campaigns, subsequent adoption by issuer

companies as well as investors, and favorable changes in the regulatory environment.

CrowdPay and its providers are vulnerable

to hackers and cyber-attacks.

As an internet-based business, we may be vulnerable

to hackers who may access the data of the investors and the issuer companies that utilize our platform.

Further, any significant disruption

in service on our platform or in our computer systems could reduce the attractiveness of the platform and result in a loss of investors

and companies interested in using our platform.

Further, we rely on a third-party technology provider to provide some of our back-up technology

as well as act as our escrow agent.

Any disruptions of services or cyber-attacks either on our technology provider or on our company could

harm our reputation and materially negatively impact our financial condition and business.

CrowdPay currently relies on one escrow

agent and technology service provider.

We currently rely on Microsoft Azure to serve

as our technology provider and all escrow accounts are held at MVB Bank, Inc.

Any change in these relationships will require us to find

another technology service provider, escrow agent and escrow bank.

This may cause us delays as well as additional costs in transitioning

our technology.

We are dependent on general economic conditions.

Our business model is dependent on investors investing

in the companies presented on our platform.

Boulds the possibility of becoming our full-time Chief Financial Officer, it is anticipated that Ms.

Boulds will continue to be employed on a part-time basis for the next twelve months.

In addition to her role as Chief Financial Officer,

Boulds is also operating her solo accounting practice providing services for clients unrelated to the Company.

While we believe that

Boulds currently devotes adequate time to the Company to perform the role and duties of our Chief Financial Officer, we cannot guarantee

that she will be able to continue to do so until she is with the Company on a fulltime basis.

Boulds cannot devote adequate time

to our Company to fulfil her role and duties as Chief Financial Officer or if any conflicts of interest arise during this time, it could

have a material adverse impact on our Company.

success depends on our continued investment in research and development, the level and effectiveness of which could reduce our profitability.

intend to continue to make investments in research and development and product development in seeking to sustain and improve our competitive

position and meet our customers’ needs.

These investments currently include streamlining our suite of software functionalities,

including modularization and improving scalability of our integrated solutions.

To maintain our competitive position, we may need to

increase our research and development investment, which could reduce our profitability and cash flows.

In addition, we cannot assure

you that we will achieve a return on these investments, nor can we assure you that these investments will improve our competitive position

Related to Our Business

operate in a regulatory environment that is evolving and uncertain.

regulatory framework for online capital formation or crowdfunding is very new.

The regulations that govern the companies and broker-dealers

that utilize our platform and the investors that find investment opportunities on our platform have been in existence for a very few

Further, there are constant discussions among legislators and regulators with respect to changing this regulatory environment.

New laws and regulations could be adopted in the United States and abroad.

Further, existing laws and regulations may be interpreted

in ways that would impact our platform, including our ability to communicate and work with investors, broker-dealers and the companies

that use our platforms’ services.

For instance over the past year, there have been several attempts to modify the current regulatory

Some of those suggested reforms could make it easier for anyone to sell securities (without using our platform), or could increase

our regulatory burden, including requiring us to register as a broker-dealer or funding portal before we choose to do so.

Any such changes

would have a negative impact on our business.

the event we are required or decide to register as a broker-dealer or funding portal, our current business model could be affected.

our current structure, we believe we are not required to register as a broker-dealer or funding portal under federal and state laws.

Further, none of our officers has previous experience in securities markets or regulations or has passed any related examinations or

holds any accreditations.

We comply with the rules surrounding funding portals and restrict our activities and services so as to not

be deemed a broker-dealer under state and federal regulations.

However, if we were deemed by a relevant authority to be acting as a broker-dealer

or a funding portal, we could be required to register or be subject to a variety of penalties, including fines and rescission offers.

Further, we may decide for business reasons or we may be required to register as a broker-dealer or a funding portal, which would increase

our costs, especially our compliance costs.

If we are required but decide not to register as a broker-dealer or act in association with

a broker-dealer in our transactions or to register as a funding portal, we may not be able to continue to operate under our current business

may be liable for misstatements made by issuers on our platform.

the Securities Act and the Securities and Exchange Act of 1934, as amended (the “Exchange Act”), issuers making offerings

through our platform may be liable for including untrue statements of material facts or for omitting information that could make the

statements made misleading.

This liability may also extend in Regulation Crowdfunding offerings to funding portals.

Even though we are

not a registered funding portal, there can be no assurance that if we were sued we would prevail.

Further, even if we do succeed, lawsuits

are time consuming and expensive, and being a party to such actions may cause us reputational harm that would negatively impact our business.

compliance is focused on U.S.

laws and we have not analyzed foreign laws regarding the participation of non-U.S.

of the investment opportunities posted on our platform are open to non-U.S.

We have not researched all the applicable foreign

laws and regulations, and therefore we have not set up our structure to be compliant with all those laws.

It is possible that we may

be deemed in violation of those laws, which could result in fines or penalties as well as reputational harm.

This may limit our ability

in the future to assist companies in accessing money from those investors, and compliance with those laws and regulation may limit our

business operations and plans for future expansion.

types of offerings that we expect to be posted on our platform are relatively new in an industry that is still quickly evolving .

principal types of offerings that are posted on our platform are pursuant to Regulation A and Regulation Crowdfunding (CF) which have

only been in effect in their current form since 2015 and 2016, respectively.

Our ability to penetrate the market to host these types

of offerings remains uncertain as potential issuer companies may choose to use different platforms or providers (including, in the case

of Regulation A, using their own online platform), or determine alternative methods of financing.

Investors may decide to invest their

money elsewhere.

Further, our potential market may not be as large, or our industry may not grow as rapidly, as anticipated.

With a smaller

market than expected, we may have fewer customers.

Success will likely be a factor of investing in the development and implementation

of marketing campaigns, subsequent adoption by issuer companies as well as investors, and favorable changes in the regulatory environment.

and its providers are vulnerable to hackers and cyber-attacks.

an internet-based business, we may be vulnerable to hackers who may access the data of the investors and the issuer companies that utilize

our platform.

Further, any significant disruption in service on our platform or in our computer systems could reduce the attractiveness

of the platform and result in a loss of investors and companies interested in using our platform.

Further, we rely on a third-party technology

provider to provide some of our back-up technology as well as act as our escrow agent.

Any disruptions of services or cyber-attacks either

on our technology provider or on our company could harm our reputation and materially negatively impact our financial condition and business.

currently relies on one escrow agent and technology service provider.

currently rely on Microsoft Azure to serve as our technology provider and all escrow accounts are held at MVB Bank, Inc.

Any change in

these relationships will require us to find another technology service provider, escrow agent and escrow bank.

This may cause us delays

as well as additional costs in transitioning our technology.

are dependent on general economic conditions.

business model is dependent on investors investing in the companies presented on our platform.

Investment dollars are disposable income.

Our business model is thus dependent on national

and international economic conditions.

Adverse national and international economic conditions, including as a result of COVID-19, may

reduce the future availability of investment dollars, which would negatively impact revenues generated by CrowdPay and possibly our ability

to continue operations at CrowdPay.

It is not possible to accurately predict the potential adverse impacts on us, if any, of current economic

conditions on its financial condition, operating results and cash flow.

We face significant market competition.

We facilitate online capital formation.

this is a new market, we compete against a variety of entrants in the market as well likely new entrants into the market.

Some of these

follow a regulatory model that is different from ours and might provide them competitive advantages.

New entrants could include those

that may already have a foothold in the securities industry, including some established broker-dealers.

Further, online capital formation

is not the only way to address helping start-ups raise capital, and we have to compete with a number of other approaches, including traditional

venture capital investments, loans and other traditional methods of raising funds and companies conducting crowdfunding raises on their

own websites.

Additionally, some competitors and future competitors may be better capitalized than us, which would give them a significant

advantage in marketing and operations.

Our revenues and profits are subject to

fluctuations.

It is difficult to accurately forecast our revenues

and operating results, and these could fluctuate in the future due to a number of factors.

These factors may include adverse changes in

the number of investors and amount of investors’ dollars that utilize our platform to make investments, the success of world securities

markets, general economic conditions, our ability to market our platform to companies and investors, headcount and other operating costs,

and general industry and regulatory conditions and requirements.

Our operating results may fluctuate from year to year due to the factors

listed above and others not listed.

At times, these fluctuations may be significant and could impact our ability to operate our business.

We are substantially dependent on our eVance

business for revenue.

If we are unable to maintain our eVance business for any reason (including the various reasons described in the

risk factors herein) or for no reason it will have a material adverse effect on our company.

Historically, substantially all of our revenue

has been generated from our eVance business, though we did begin generating revenue from our OmniSoft and CrowdPay business during the

second half of 2019.

In addition, the launch of our Cryptocurrency Business in 2021 has started to generate revenue in 2021 and 2022.

While we expect to continue to build out our OmniSoft software business and to rely more heavily on our PayFac model and our Cryptocurrency

Business to generate revenue and to transition away from such significant reliance on our eVance business, there is no guarantee that

we will be able to do so (particularly, giving effect to the impact of COVID-19).

Accordingly, if we are unable to maintain our eVance

business it will have a material adverse effect on our company.

Our ability to anticipate and respond to

changing industry trends and the needs and preferences of our merchants and consumers may adversely affect our competitiveness or the

demand for our products and services.

The financial services and payments technology

industries are subject to rapid technological advancements, resulting in new products and services, including mobile payment applications

and customized integrated software payment solutions, and an evolving competitive landscape, as well as changing industry standards and

merchant and consumer needs and preferences.

We expect that new services and technologies applicable to the financial services and payment

technology industries will continue to emerge.

These changes may limit the competitiveness of and demand for our services.

Also, our merchants

and consumers continue to adopt new technology for business and personal uses.

We must anticipate and respond to these changes in order

to remain competitive within our relative markets.

In addition, failure to develop value-added services that meet the needs and preferences

of our merchants could adversely affect our ability to compete effectively in our industry.

Furthermore, merchants’ or consumers’

potential negative reaction to our products and services can spread quickly through social media and damage our reputation before we have

the opportunity to respond.

If we are unable to anticipate or respond to technological or industry standard changes on a timely basis,

our ability to remain competitive could be adversely affected.

Substantial and increasingly intense competition

worldwide in the financial services and payment technology industries may adversely affect our overall business and operations.

The financial services and payment technology

industries are highly competitive, and our payment services and solutions compete against all forms of financial services and payment

systems, including cash and checks, and electronic, mobile, E-commerce and integrated payment platforms.

If we are unable to differentiate

ourselves from our competitors and drive value for our merchants, we may not be able to compete effectively.

Our competitors may introduce

their own value-added or other innovative services or solutions more effectively than we do, which could adversely impact our current

competitive position and prospects for growth.

They also may be able to offer and provide services that we do not offer.

in certain of our markets in which we operate, we process “on-us” transactions whereby we receive fees as a merchant acquirer

and for processing services for the issuing bank.

As competition in these markets grows, the number of transactions in which we receive

fees for both of these roles may decrease, which could reduce our revenue and margins in these jurisdictions.

We also compete against

new entrants that have developed alternative payment systems, E-commerce payment systems, payment systems for mobile devices and customized

integrated software payment solutions.

Failure to compete effectively against any of these competitive threats could adversely affect

our business, financial condition or results of operations.

In addition, some of our competitors are larger and have greater financial

resources than us, enabling them to maintain a wider range of product offerings, mount extensive promotional campaigns and be more aggressive

in offering products and services at lower rates, which may adversely affect our business, financial condition or results of operations.

Potential changes in the competitive landscape,

including disintermediation from other participants in the payments chain, could harm our business.

We expect that the competitive landscape will

continue to change, including:

rapid and significant changes in technology, resulting in new and innovative payment methods and programs, that could place us at a competitive disadvantage and reduce the use of our products and services;

competitors, merchants, governments and other industry participants may develop products and services that compete with or replace our value-added products and services, including products and services that enable card networks and banks to transact with consumers directly;

participants in the financial services and payment technology industries may merge, create joint ventures, or form other business combinations that may strengthen their existing business services or create new payment services that compete with our services;

new services and technologies that we develop may be impacted by industry-wide solutions and standards, including chip technology, tokenization, Blockchain and other safety and security technologies.

Our business model is thus dependent on national and international economic conditions.

Adverse national and international economic conditions,

including as a result of COVID-19, may reduce the future availability of investment dollars, which would negatively impact revenues generated

by CrowdPay and possibly our ability to continue operations at CrowdPay.

It is not possible to accurately predict the potential adverse

impacts on us, if any, of current economic conditions on its financial condition, operating results and cash flow.

face significant market competition.

facilitate online capital formation.

Though this is a new market, we compete against a variety of entrants in the market as well likely

new entrants into the market.

Some of these follow a regulatory model that is different from ours and might provide them competitive

New entrants could include those that may already have a foothold in the securities industry, including some established

broker-dealers.

Further, online capital formation is not the only way to address helping start-ups raise capital, and we have to compete

with a number of other approaches, including traditional venture capital investments, loans and other traditional methods of raising

funds and companies conducting crowdfunding raises on their own websites.

Additionally, some competitors and future competitors may be

better capitalized than us, which would give them a significant advantage in marketing and operations.

revenues and profits are subject to fluctuations.

is difficult to accurately forecast our revenues and operating results, and these could fluctuate in the future due to a number of factors.

These factors may include adverse changes in the number of investors and amount of investors’ dollars that utilize our platform

to make investments, the success of world securities markets, general economic conditions, our ability to market our platform to companies

and investors, headcount and other operating costs, and general industry and regulatory conditions and requirements.

Our operating results

may fluctuate from year to year due to the factors listed above and others not listed.

At times, these fluctuations may be significant

and could impact our ability to operate our business.

are substantially dependent on our eVance business for revenue.

If we are unable to maintain our eVance business for any reason (including

the various reasons described in the risk factors herein) or for no reason it will have a material adverse effect on our company.

Historically,

substantially all of our revenue has been generated from our eVance business, though we did begin generating revenue from our OmniSoft

and CrowdPay business during the second half of 2019.

In addition, the launch of our Cryptocurrency Mining business in 2021 has started

to generate revenue in 2021 and 2022.

While we expect to continue to build out our OmniSoft software business and to rely more heavily

on individualized merchant services offerings and to generate revenue and to transition away from such significant reliance on our eVance

business, there is no guarantee that we will be able to do so (particularly, giving effect to the impact of COVID-19).

Accordingly, if

we are unable to maintain our eVance business it will have a material adverse effect on our company.

ability to anticipate and respond to changing industry trends and the needs and preferences of our merchants and consumers may adversely

affect our competitiveness or the demand for our products and services.

financial services and payments technology industries are subject to rapid technological advancements, resulting in new products and

services, including mobile payment applications and customized integrated software payment solutions, and an evolving competitive landscape,

as well as changing industry standards and merchant and consumer needs and preferences.

We expect that new services and technologies

applicable to the financial services and payment technology industries will continue to emerge.

These changes may limit the competitiveness

of and demand for our services.

Also, our merchants and consumers continue to adopt new technology for business and personal uses.

must anticipate and respond to these changes in order to remain competitive within our relative markets.

In addition, failure to develop

value-added services that meet the needs and preferences of our merchants could adversely affect our ability to compete effectively in

our industry.

Furthermore, merchants’ or consumers’ potential negative reaction to our products and services can spread quickly

through social media and damage our reputation before we have the opportunity to respond.

If we are unable to anticipate or respond to

technological or industry standard changes on a timely basis, our ability to remain competitive could be adversely affected.

and increasingly intense competition worldwide in the financial services and payment technology industries may adversely affect our overall

business and operations.

financial services and payment technology industries are highly competitive, and our payment services and solutions compete against all

forms of financial services and payment systems, including cash and checks, and electronic, mobile, E-commerce and integrated payment

If we are unable to differentiate ourselves from our competitors and drive value for our merchants, we may not be able to

compete effectively.

Our competitors may introduce their own value-added or other innovative services or solutions more effectively than

we do, which could adversely impact our current competitive position and prospects for growth.

They also may be able to offer and provide

services that we do not offer.

In addition, in certain of our markets in which we operate, we process “on-us” transactions

whereby we receive fees as a merchant acquirer and for processing services for the issuing bank.

As competition in these markets grows,

the number of transactions in which we receive fees for both of these roles may decrease, which could reduce our revenue and margins

in these jurisdictions.

We also compete against new entrants that have developed alternative payment systems, E-commerce payment systems,

payment systems for mobile devices and customized integrated software payment solutions.

Failure to compete effectively against any of

these or other competitive threats could adversely affect our business, financial condition or results of operations.

Global economic, political and other conditions

may adversely affect trends in consumer, business and government spending, which may adversely impact the demand for our services and

our revenue and profitability.

The financial services and payment technology

industries in which we operate depend heavily upon the overall level of consumer, business and government spending.

A sustained deterioration

in general economic conditions (including distress in financial markets, turmoil in specific economies around the world, public health

crises, and additional government intervention), particularly in the United States, or increases in interest rates in key countries in

which we operate, may adversely affect our financial performance by reducing the number or average purchase amount of transactions we

For example, as of the date of this Annual Report, the COVID-19 pandemic, has impacted and may continue to impact the global

economy or negatively affect various aspects of our business, including reductions in the amount of consumer spending and lending which

could result in a decrease in our revenue and profits.

If our customers make fewer sales of products and services using electronic payments,

or consumers spend less money through electronic payments, whether due to the outbreak of COVID-19 or otherwise, we will have fewer transactions

to process at lower dollar amounts, resulting in lower revenue.

Adverse economic trends whether a result of the

global COVID-19 outbreak or otherwise, will and may continue to accelerate the timing, or increase the impact of, risks to our financial

these competitive threats could adversely affect our business, financial condition or results of operations.

In addition, some of our

competitors are larger and have greater financial resources than us, enabling them to maintain a wider range of product offerings, mount

extensive promotional campaigns and be more aggressive in offering products and services at lower rates, which may adversely affect our

business, financial condition or results of operations.

changes in the competitive landscape, including disintermediation from other participants in the payments chain, could harm our business.

expect that the competitive landscape will continue to change, including:

and significant changes in technology, resulting in new and innovative payment methods and programs, that could place us at a competitive

disadvantage and reduce the use of our products and services;

● competitors,

merchants, governments and other industry participants may develop products and services that compete with or replace our value-added

products and services, including products and services that enable card networks and banks to transact with consumers directly;

● participants

in the financial services and payment technology industries may merge, create joint ventures, or form other business combinations that

may strengthen their existing business services or create new payment services that compete with our services;

services and technologies that we develop may be impacted by industry-wide solutions and standards, including chip technology, tokenization,

Blockchain and other safety and security technologies.

to compete effectively against any of these or other competitive threats could adversely affect our business, financial condition or

results of operations.

economic, political and other conditions may adversely affect trends in consumer, business and government spending, which may adversely

impact the demand for our services and our revenue and profitability.

financial services and payment technology industries in which we operate depend heavily upon the overall level of consumer, business

and government spending.

A sustained deterioration in general economic conditions (including distress in financial markets, turmoil in

specific economies around the world, public health crises, and additional government intervention), particularly in the United States,

or increases in interest rates in key countries in which we operate, may adversely affect our financial performance by reducing the number

or average purchase amount of transactions we process.

For example, as of the date of this Annual Report, the COVID-19 pandemic, has

impacted and may continue to impact the global economy or negatively affect various aspects of our business, including reductions in

the amount of consumer spending and lending which could result in a decrease in our revenue and profits.

If our customers make fewer

sales of products and services using electronic payments, or consumers spend less money through electronic payments, whether due to the

outbreak of COVID-19 or otherwise, we will have fewer transactions to process at lower dollar amounts, resulting in lower revenue.

economic trends whether a result of the global COVID-19 outbreak or otherwise, will and may continue to accelerate the timing, or increase

the impact of, risks to our financial performance.

These trends could include:

declining economies, foreign currency fluctuations and the pace of economic recovery can change consumer spending behaviors, such as cross-border travel patterns, on which the majority of our revenue is dependent;

low levels of consumer and business confidence typically associated with recessionary environments, and those markets experiencing relatively high unemployment, may result in decreased spending by cardholders;

budgetary concerns in the United States and other countries around the world could affect the United States and other specific sovereign credit ratings, impact consumer confidence and spending, and increase the risks of operating in those countries;

emerging market economies tend to be more volatile than the more established markets we serve in North America and Europe, and adverse economic trends may be more pronounced in those emerging markets where we conduct business;

financial institutions may restrict credit lines to cardholders or limit the issuance of new cards to mitigate cardholder credit concerns;

uncertainty and volatility in the performance of our merchants’ businesses may make estimates of our revenues and financial performance less predictable;

cardholders may decrease spending for value-added services we market and sell;

a weakening in the economy, either due to the global COVID-19 outbreak or otherwise, has forced, and could continue to force merchants to close at higher than historical rates in part because many of them are not as well capitalized as larger organizations, which could expose us to potential credit losses and future transaction declines;

government intervention, including the effect of laws, regulations and government investments in our merchants, may have potential negative effects on our business and our relationships with our merchants or otherwise alter their strategic direction away from our products and services.

We are subject to U.S.

governmental regulation

and other legal obligations, particularly related to privacy, data protection and information security, and consumer protection laws across

different markets where we conduct our business.

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

In the United States, we are subject to various

consumer protection laws (including laws on disputed transactions) and related regulations.

If we are found to have breached any consumer

protection laws or regulations in any such market, we may be subject to enforcement actions that require us to change our business practices

in a manner which may negatively impact revenue, as well as litigation, fines, penalties and adverse publicity that could cause our customers

to lose trust in us, which could have an adverse effect on our reputation and business in a manner that harms our financial position.

We collect personally identifiable information

and other data from our consumers and merchants.

Laws and regulations in several countries restrict certain collection, processing, storage,

use, disclosure and security of personal information, require notice to individuals of privacy practices, and provide individuals with

certain rights to prevent use and disclosure of protected information.

Future restrictions on the collection, use, sharing

or disclosure of personally identifiable information or additional requirements and liability for security and data integrity could require

us to modify our solutions and features, possibly in a material manner, and could limit our ability to develop new services and features.

If our privacy or data security measures fail to comply with applicable current or future laws and regulations, we may be subject to litigation,

regulatory investigations, enforcement notices requiring us to change the way we use personal data or our marketing practices, fines or

other liabilities, as well as negative publicity and a potential loss of business.

Our inability to protect our systems and

data from continually evolving cybersecurity risks or other technological risks could affect our reputation among our merchants and consumers

and may expose us to liability.

In conducting our business, we process, transmit

and store sensitive business information and personal information about our merchants, consumers, sales and financial institution partners,

vendors, and other parties.

This information may include account access credentials, credit and debit card numbers, bank account numbers,

social security numbers, driver’s license numbers, names and addresses and other types of sensitive business or personal information.

Some of this information is also processed and stored by our merchants, sales and financial institution partners, third-party service

providers to whom we outsource certain functions and other agents, which we refer to collectively as our associated third parties.

have certain responsibilities to card networks and their member financial institutions for any failure, including the failure of our associated

third parties, to protect this information.

We are a regular target of malicious third-party

attempts to identify and exploit system vulnerabilities, and/or penetrate or bypass our security measures, in order to gain unauthorized

access to our networks and systems or those of our associated third parties.

Such access could lead to the compromise of sensitive, business,

personal or confidential information.

As a result, we proactively employ multiple methods at different layers of our systems to defend

our systems against intrusion and attack and to protect the data we collect.

However, we cannot be certain that these measures will be

successful and will be sufficient to counter all current and emerging technology threats that are designed to breach our systems in order

to gain access to confidential information.

Our computer systems and our associated third

parties’ computer systems could be in the future, subject to breach, and our data protection measures may not prevent unauthorized

The techniques used to obtain unauthorized access, disable or degrade service, or sabotage systems change frequently and are often

difficult to detect.

Threats to our systems and our associated third parties’ systems can derive from human error, fraud or malice

on the part of employees or third parties, or may result from accidental technological failure.

Computer viruses and other malware can

be distributed and could infiltrate our systems or those of our associated third parties.

In addition, denial of service or other attacks

could be launched against us for a variety of purposes, including to interfere with our services or create a diversion for other malicious

Our defensive measures may not prevent downtime, unauthorized access or use of sensitive data.

While we maintain cyber errors

and omissions insurance coverage that may cover certain aspects of cyber risks, our insurance coverage may be insufficient to cover all

economies, foreign currency fluctuations and the pace of economic recovery can change consumer spending behaviors, such as cross-border

travel patterns, on which the majority of our revenue is dependent;

levels of consumer and business confidence typically associated with recessionary environments, and those markets experiencing relatively

high unemployment, may result in decreased spending by cardholders;

concerns in the United States and other countries around the world could affect the United States and other specific sovereign credit

ratings, impact consumer confidence and spending, and increase the risks of operating in those countries;

market economies tend to be more volatile than the more established markets we serve in North America and Europe, and adverse economic

trends may be more pronounced in those emerging markets where we conduct business;

institutions may restrict credit lines to cardholders or limit the issuance of new cards to mitigate cardholder credit concerns;

● uncertainty

and volatility in the performance of our merchants’ businesses may make estimates of our revenues and financial performance less

● cardholders

may decrease spending for value-added services we market and sell;

weakening in the economy, either due to the global COVID-19 outbreak or otherwise, has forced, and could continue to force merchants

to close at higher than historical rates in part because many of them are not as well capitalized as larger organizations, which could

expose us to potential credit losses and future transaction declines;

intervention, including the effect of laws, regulations and government investments in our merchants, may have potential negative effects

on our business and our relationships with our merchants or otherwise alter their strategic direction away from our products and services.

are subject to U.S.

governmental regulation and other legal obligations, particularly related to privacy, data protection and information

security, and consumer protection laws across different markets where we conduct our business.

Our actual or perceived failure to comply

with such obligations could harm our business.

the United States, we are subject to various consumer protection laws (including laws on disputed transactions) and related regulations.

If we are found to have breached any consumer protection laws or regulations in any such market, we may be subject to enforcement actions

that require us to change our business practices in a manner which may negatively impact revenue, as well as litigation, fines, penalties

and adverse publicity that could cause our customers to lose trust in us, which could have an adverse effect on our reputation and business

in a manner that harms our financial position.

collect personally identifiable information and other data from our consumers and merchants.

Laws and regulations in several countries

restrict certain collection, processing, storage, use, disclosure and security of personal information, require notice to individuals

of privacy practices, and provide individuals with certain rights to prevent use and disclosure of protected information.

restrictions on the collection, use, sharing or disclosure of personally identifiable information or additional requirements and liability

for security and data integrity could require us to modify our solutions and features, possibly in a material manner, and could limit

our ability to develop new services and features.

If our privacy or data security measures fail to comply with applicable current or

future laws and regulations, we may be subject to litigation, regulatory investigations, enforcement notices requiring us to change the

way we use personal data or our marketing practices, fines or other liabilities, as well as negative publicity and a potential loss of

inability to protect our systems and data from continually evolving cybersecurity risks or other technological risks could affect our

reputation among our merchants and consumers and may expose us to liability.

conducting our business, we process, transmit and store sensitive business information and personal information about our merchants,

consumers, sales and financial institution partners, vendors, and other parties.

This information may include account access credentials,

credit and debit card numbers, bank account numbers, social security numbers, driver’s license numbers, names and addresses and

other types of sensitive business or personal information.

Some of this information is also processed and stored by our merchants, sales

and financial institution partners, third-party service providers to whom we outsource certain functions and other agents, which we refer

to collectively as our associated third parties.

We have certain responsibilities to card networks and their member financial institutions

for any failure, including the failure of our associated third parties, to protect this information.

are a regular target of malicious third-party attempts to identify and exploit system vulnerabilities, and/or penetrate or bypass our

security measures, in order to gain unauthorized access to our networks and systems or those of our associated third parties.

could lead to the compromise of sensitive, business, personal or confidential information.

As a result, we proactively employ multiple

methods at different layers of our systems to defend our systems against intrusion and attack and to protect the data we collect.

we cannot be certain that these measures will be successful and will be sufficient to counter all current and emerging technology threats

that are designed to breach our systems in order to gain access to confidential information.

computer systems and our associated third parties’ computer systems could be in the future, subject to breach, and our data protection

measures may not prevent unauthorized access.

The techniques used to obtain unauthorized access, disable or degrade service, or sabotage

systems change frequently and are often difficult to detect.

Threats to our systems and our associated third parties’ systems can

derive from human error, fraud or malice on the part of employees or third parties, or may result from accidental technological failure.

Computer viruses and other malware can be distributed and could infiltrate our systems or those of our associated third parties.

denial of service or other attacks could be launched against us for a variety of purposes, including to interfere with our services or

create a diversion for other malicious activities.

Our defensive measures may not prevent downtime, unauthorized access or use of sensitive

While we maintain cyber errors and omissions insurance coverage that may cover certain aspects of cyber risks, our insurance coverage

may be insufficient to cover all losses.

Further, while we select our associated third parties carefully, we do not control their actions.

Any problems experienced by

these third parties, including those resulting from breakdowns or other disruptions in the services provided by such parties or cyber-attacks

and security breaches, could adversely affect our ability to service our merchant customers or otherwise conduct our business.

We could also be subject to liability for claims

relating to misuse of personal information, such as unauthorized marketing purposes and violation of data privacy laws.

We cannot provide

assurance that the contractual requirements related to security and privacy that we impose on our service providers who have access to

customer and consumer data will be followed or will be adequate to prevent the unauthorized use or disclosure of data.

In addition, we

have agreed in certain agreements to take certain protective measures to ensure the confidentiality of merchant and consumer data.

costs of systems and procedures associated with such protective measures may increase and could adversely affect our ability to compete

Any failure to adequately enforce or provide these protective measures could result in liability, protracted and costly litigation,

governmental and card network intervention and fines and, with respect to misuse of personal information of our merchants and consumers,

lost revenue and reputational harm.

Any type of security breach, attack or misuse

of data described above or otherwise, whether experienced by us or an associated third party, could harm our reputation and deter existing

and prospective merchants from using our services or from making electronic payments generally, increase our operating expenses in order

to contain and remediate the incident, expose us to unbudgeted or uninsured liability, disrupt our operations (including potential service

interruptions), distract our management, increase our risk of regulatory scrutiny, result in the imposition of penalties and fines under

state, federal and foreign laws or by card networks and adversely affect our continued card network registration and financial institution

If we were to be removed from networks’ lists of PCI DSS compliant service providers, our existing merchants, sales

and financial institution partners or other third parties may cease using or referring our services.

Also, prospective merchants, sales

partners, financial institution partners or other third parties may choose to terminate their relationship with us, or delay or choose

not to consider us for their processing needs.

In addition, card networks could refuse to allow us to process through their networks.

We may experience failures in our processing

systems due to software defects, computer viruses and development delays, which could damage customer relations and expose us to liability.

Our core business depends heavily on the reliability

of our processing systems.

A system outage or other failure could adversely affect our business, financial condition or results of operations,

including by damaging our reputation or exposing us to third-party liability.

Card network rules and certain governmental regulations

allow for possible penalties if our systems do not meet certain operating standards.

To successfully operate our business, we must be

able to protect our processing and other systems from interruption, including from events that may be beyond our control.

could cause system interruptions include fire, natural disaster, unauthorized entry, power loss, telecommunications failure, computer

viruses, terrorist acts and war.

Although we have taken steps to protect against data loss and system failures, there is still risk that

we may lose critical data or experience system failures.

To help protect against these events, we perform a significant portion of disaster

recovery operations ourselves, as well as utilize select third parties for certain operations, particularly outside of the United States.

To the extent we outsource any disaster recovery functions, we are at risk of the vendor’s unresponsiveness or other failures in

the event of breakdowns in our systems.

In addition, our property and business interruption insurance may not be adequate to compensate

us for all losses or failures that may occur.

Our products and services are based on sophisticated

software and computing systems that are constantly evolving.

We often encounter delays and cost overruns in developing changes implemented

to our systems.

In addition, the underlying software may contain undetected errors, viruses or defects.

Defects in our software products

and errors or delays in our processing of electronic transactions could result in additional development costs, diversion of technical

and other resources from our other development efforts, loss of credibility with current or potential merchants, harm to our reputation

or exposure to liability claims.

In addition, we rely on technologies supplied to us by third parties that may also contain undetected

errors, viruses or defects that could adversely affect our business, financial condition or results of operations.

Although we attempt

to limit our potential liability for warranty claims through disclaimers in our software documentation and limitation of liability provisions

in our licenses and other agreements with our merchants and partners, we cannot assure that these measures will be successful in limiting

our liability.

Additionally, we and our merchants and partners are subject to card network rules.

If we do not comply with card network

requirements or standards, we may be subject fines or sanctions, including suspension or termination of our registrations and licenses

necessary to conduct business.

Degradation of the quality of the products

and services we offer, including support services, could adversely impact our ability to attract and retain merchants and partners.

Our merchants and partners expect a consistent

level of quality in the provision of our products and services.

The support services we provide are a key element of the value proposition

to our merchants and partners.

If the reliability or functionality of our products and services is compromised or the quality of those

products or services is otherwise degraded, or if we fail to continue to provide a high level of support, we could lose existing merchants

and partners and find it harder to attract new merchants and partners.

If we are unable to scale our support functions to address the

growth of our merchant and partner network, the quality of our support may decrease, which could adversely affect our ability to attract

and retain merchants and partners.

Acquisitions create certain risks and may

adversely affect our business, financial condition or results of operations.

We may make acquisitions of businesses or assets

in the future.

The acquisition and integration of businesses or assets involve a number of risks.

These risks include valuation (determining

a fair price for the business or assets), integration (managing the process of integrating the acquired business’ people, products,

technology and other assets to extract the value and synergies projected to be realized in connection with the acquisition), regulation

(obtaining regulatory or other government approvals that may be necessary to complete the acquisition) and due diligence (including identifying

risks to the prospects of the business, including undisclosed or unknown liabilities or restrictions to be assumed in the acquisition).

The process of integrating operations could cause

an interruption of, or loss of momentum in, the activities of one or more of our combined businesses and the possible loss of key personnel.

The diversion of management’s attention and any delays or difficulties encountered in connection with acquisitions and their integration

could adversely affect our business, financial condition or results of operations.

Continued consolidation in the banking industry

could adversely affect our growth.

The banking industry remains subject to consolidation

regardless of overall economic conditions.

In addition, in times of economic distress, various regulators in the markets we serve have

acquired and in the future may acquire financial institutions, including banks with which we partner.

If a current financial institution

referral partner of ours is acquired by another bank, the acquiring bank may seek to terminate our agreement and impose its own merchant

services program on the acquired bank.

If a financial institution referral partner acquires another bank, our financial institution referral

partner may take the opportunity to conduct a competitive bidding process to determine whether to maintain our merchant acquiring services

or switch to another provider.

In either situation, we may be unable to retain the relationship post-acquisition, or may have to offer

financial concessions to do so, which could adversely affect our results of operations or growth.

If a current financial institution referral

partner of ours is acquired by a regulator, the regulator may seek to alter the terms or terminate our existing agreement with the acquired

financial institution.

Increased customer, referral partner or

sales partner attrition could cause our financial results to decline.

We experience attrition in merchant credit and

debit card processing volume resulting from several factors, including business closures, transfers of merchants’ accounts to our

competitors, unsuccessful contract renewal negotiations and account closures that we initiate for various reasons, such as heightened

credit risks or contract breaches by merchants.

In addition, if an existing sales partner switches to another payment processor, terminates

our services, internalizes payment processing functions that we perform, merges with or is acquired by one of our competitors, or shuts

down or becomes insolvent, we may no longer receive new customer referrals from the sales partner, and we risk losing existing merchants

that were originally enrolled by the sales partner.

We cannot predict the level of attrition in the future and it could increase.

referral partners are a significant source of new business.

Higher than expected attrition could adversely affect our business, financial

Any problems experienced by these third parties, including those resulting from breakdowns or other disruptions in the services provided

by such parties or cyber-attacks and security breaches, could adversely affect our ability to service our merchant customers or otherwise

conduct our business.

could also be subject to liability for claims relating to misuse of personal information, such as unauthorized marketing purposes and

violation of data privacy laws.

We cannot provide assurance that the contractual requirements related to security and privacy that we

impose on our service providers who have access to customer and consumer data will be followed or will be adequate to prevent the unauthorized

use or disclosure of data.

In addition, we have agreed in certain agreements to take certain protective measures to ensure the confidentiality

of merchant and consumer data.

The costs of systems and procedures associated with such protective measures may increase and could adversely

affect our ability to compete effectively.

Any failure to adequately enforce or provide these protective measures could result in liability,

protracted and costly litigation, governmental and card network intervention and fines and, with respect to misuse of personal information

of our merchants and consumers, lost revenue and reputational harm.

type of security breach, attack or misuse of data described above or otherwise, whether experienced by us or an associated third party,

could harm our reputation and deter existing and prospective merchants from using our services or from making electronic payments generally,

increase our operating expenses in order to contain and remediate the incident, expose us to unbudgeted or uninsured liability, disrupt

our operations (including potential service interruptions), distract our management, increase our risk of regulatory scrutiny, result

in the imposition of penalties and fines under state, federal and foreign laws or by card networks and adversely affect our continued

card network registration and financial institution sponsorship.

If we were to be removed from networks’ lists of PCI DSS compliant

service providers, our existing merchants, sales and financial institution partners or other third parties may cease using or referring

our services.

Also, prospective merchants, sales partners, financial institution partners or other third parties may choose to terminate

their relationship with us, or delay or choose not to consider us for their processing needs.

In addition, card networks could refuse

to allow us to process through their networks.

may experience failures in our processing systems due to software defects, computer viruses and development delays, which could damage

customer relations and expose us to liability.

core business depends heavily on the reliability of our processing systems.

A system outage or other failure could adversely affect our

business, financial condition or results of operations, including by damaging our reputation or exposing us to third-party liability.

Card network rules and certain governmental regulations allow for possible penalties if our systems do not meet certain operating standards.

To successfully operate our business, we must be able to protect our processing and other systems from interruption, including from events

that may be beyond our control.

Events that could cause system interruptions include fire, natural disaster, unauthorized entry, power

loss, telecommunications failure, computer viruses, terrorist acts and war.

Although we have taken steps to protect against data loss

and system failures, there is still risk that we may lose critical data or experience system failures.

To help protect against these

events, we perform a significant portion of disaster recovery operations ourselves, as well as utilize select third parties for certain

operations, particularly outside of the United States.

To the extent we outsource any disaster recovery functions, we are at risk of

the vendor’s unresponsiveness or other failures in the event of breakdowns in our systems.

In addition, our property and business

interruption insurance may not be adequate to compensate us for all losses or failures that may occur.

products and services are based on sophisticated software and computing systems that are constantly evolving.

We often encounter delays

and cost overruns in developing changes implemented to our systems.

In addition, the underlying software may contain undetected errors,

viruses or defects.

Defects in our software products and errors or delays in our processing of electronic transactions could result in

additional development costs, diversion of technical and other resources from our other development efforts, loss of credibility with

current or potential merchants, harm to our reputation or exposure to liability claims.

In addition, we rely on technologies supplied

to us by third parties that may also contain undetected errors, viruses or defects that could adversely affect our business, financial

condition or results of operations.

In addition, in certain of the markets in which we conduct business, a substantial portion of our

revenue is derived from long-term contracts.

If we are unable to renew our referral partner and our merchant contracts on favorable terms,

or at all, our business, financial condition or results of operations could be adversely affected.

We incur chargeback liability when our merchants

refuse to or cannot reimburse chargebacks resolved in favor of their customers.

Any increase in chargebacks not paid by our merchants

may adversely affect our business, financial condition or results of operations.

In the event a dispute between a cardholder and

a merchant is not resolved in favor of the merchant, the transaction is normally charged back to the merchant and the purchase price is

credited or otherwise refunded to the cardholder.

If we are unable to collect such amounts from the merchant’s account or reserve

account (if applicable), or if the merchant refuses or is unable, due to closure, bankruptcy or other reasons, to reimburse us for a chargeback,

we are responsible for the amount of the refund paid to the cardholder.

The risk of chargebacks is typically greater with those merchants

that promise future delivery of goods and services rather than delivering goods or rendering services at the time of payment, as well

as “card not present” transactions in which consumers do not physically present cards to merchants in connection with the

purchase of goods and services, such as E-commerce, telephonic and mobile transactions.

We may experience significant losses from chargebacks

in the future.

Any increase in chargebacks not paid by our merchants could have a material adverse effect on our business, financial condition

or results of operations.

We have policies and procedures to monitor and manage merchant-related credit risks and often mitigate such

risks by requiring collateral (such as cash reserves) and monitoring transaction activity.

Notwithstanding our policies and procedures

for managing credit risk, it is possible that a default on such obligations by one or more of our merchants could adversely affect our

business, financial condition or results of operations.

Failure to maintain or collect reimbursements

from our financial institution referral partners could adversely affect our business.

Certain of our long-term referral arrangements

with our financial institution partners permit our bank partners to offer their merchant customers lower rates for processing services

than we typically provide to the general market.

If a bank partner elects to offer these lower rates, under our contract the partner is

required to reimburse us for the full amount of the discount provided to its merchant customers.

Notwithstanding such contractual commitments,

there can be no assurance that these contractual provisions will fully protect us from potential losses should a bank partner default

on its obligations to reimburse us or seek to discontinue such reimbursement obligations in the future.

If we are unable to collect the

full amount of any such reimbursements for any reason, we may incur losses.

In addition, any discount provided by our financial institution

partner may cause merchants in these markets to demand lower rates for our services in the future, which could further reduce our margins

or cause us to lose merchants, either of which could adversely affect our business, financial condition or results of operations.

Fraud by merchants or others could adversely

affect our business, financial condition or results of operations.

We may be liable for certain fraudulent transactions

and credits initiated by merchants or others.

Examples of merchant fraud include merchants or other parties knowingly using a stolen or

counterfeit credit or debit card, card number, or other credentials to record a false sales or credit transaction, processing an invalid

card or intentionally failing to deliver the merchandise or services sold in an otherwise valid transaction.

Criminals are using increasingly

sophisticated methods to engage in illegal activities such as counterfeiting and fraud.

Failure to effectively manage risk and prevent

fraud could increase our chargeback liability or cause us to incur other liabilities.

It is possible that incidents of fraud could increase

in the future.

Increases in chargebacks or other liabilities could adversely affect our business, financial condition or results of operations.

Because we rely on third-party vendors to

provide products and services, we could be adversely impacted if they fail to fulfill their obligations.

We depend on third-party vendors and partners

to provide us with certain products and services, including components of our computer systems, software, data centers, “know-your-customer”

background checks and telecommunications networks, to conduct our business.

For example, we rely on third parties for services such as

organizing and accumulating certain daily transaction data on a merchant-by-merchant and card issuer-by-card issuer basis and forwarding

the accumulated data to the relevant card network.

We also rely on third parties for specific software and hardware used in providing

our products and services.

Some of these organizations and service providers are our competitors or provide similar services and technology

to our competitors, and we do not have long-term or exclusive contracts with them.

Our systems and operations or those of our third-party

vendors and partners could be exposed to damage or interruption from, among other things, fire, natural disaster, power loss, telecommunications

failure, unauthorized entry, computer viruses, denial-of-service attacks, acts of terrorism, human error, vandalism or sabotage, financial

insolvency, bankruptcy and similar events (including events that are the result of the COVID-19 pandemic).

In addition, we may be unable

to renew our existing contracts with our most significant vendors and partners or our vendors and partners may stop providing or otherwise

supporting the products and services we obtain from them, and we may not be able to obtain these or similar products or services on the

same or similar terms as our existing arrangements, if at all.

The failure of our vendors and partners to perform their obligations and

provide the products and services we obtain from them in a timely manner for any reason could adversely affect our operations and profitability

due to, among other consequences:

loss of revenues;

loss of merchants and partners;

loss of merchant and cardholder data;

fines imposed by card networks;

harm to our business or reputation resulting from negative publicity;

exposure to fraud losses or other liabilities;

additional operating and development costs;

diversion of management, technical and other resources.

Our risk management policies and procedures

may not be fully effective in mitigating our risk exposure in all market environments or against all types of risk.

We operate in a rapidly changing industry.

our risk management policies and procedures may not be fully effective to identify, monitor and manage all risks our business encounters.

If our policies and procedures are not fully effective or we are not successful in identifying and mitigating all risks to which we are

or may be exposed, we may suffer uninsured liability, harm to our reputation or be subject to litigation or regulatory actions that could

Although we attempt to limit our potential liability for warranty claims through disclaimers in our

software documentation and limitation of liability provisions in our licenses and other agreements with our merchants and partners, we

cannot assure that these measures will be successful in limiting our liability.

Additionally, we and our merchants and partners are subject

to card network rules.

If we do not comply with card network requirements or standards, we may be subject fines or sanctions, including

suspension or termination of our registrations and licenses necessary to conduct business.

of the quality of the products and services we offer, including support services, could adversely impact our ability to attract and retain

merchants and partners.

merchants and partners expect a consistent level of quality in the provision of our products and services.

The support services we provide

are a key element of the value proposition to our merchants and partners.

If the reliability or functionality of our products and services

is compromised or the quality of those products or services is otherwise degraded, or if we fail to continue to provide a high level

of support, we could lose existing merchants and partners and find it harder to attract new merchants and partners.

If we are unable

to scale our support functions to address the growth of our merchant and partner network, the quality of our support may decrease, which

could adversely affect our ability to attract and retain merchants and partners.

create certain risks and may adversely affect our business, financial condition or results of operations.

may make acquisitions of businesses or assets in the future.

The acquisition and integration of businesses or assets involve a number

These risks include valuation (determining a fair price for the business or assets), integration (managing the process of integrating

the acquired business’ people, products, technology and other assets to extract the value and synergies projected to be realized

in connection with the acquisition), regulation (obtaining regulatory or other government approvals that may be necessary to complete

the acquisition) and due diligence (including identifying risks to the prospects of the business, including undisclosed or unknown liabilities

or restrictions to be assumed in the acquisition).

process of integrating operations could cause an interruption of, or loss of momentum in, the activities of one or more of our combined

businesses and the possible loss of key personnel.

The diversion of management’s attention and any delays or difficulties encountered

in connection with acquisitions and their integration could adversely affect our business, financial condition or results of operations.

consolidation in the banking industry could adversely affect our growth.

banking industry remains subject to consolidation regardless of overall economic conditions.

In addition, in times of economic distress,

various regulators in the markets we serve have acquired and in the future may acquire financial institutions, including banks with which

If a current financial institution referral partner of ours is acquired by another bank, the acquiring bank may seek to terminate

our agreement and impose its own merchant services program on the acquired bank.

If a financial institution referral partner acquires

another bank, our financial institution referral partner may take the opportunity to conduct a competitive bidding process to determine

whether to maintain our merchant acquiring services or switch to another provider.

In either situation, we may be unable to retain the

relationship post-acquisition, or may have to offer financial concessions to do so, which could adversely affect our results of operations

If a current financial institution referral partner of ours is acquired by a regulator, the regulator may seek to alter the

terms or terminate our existing agreement with the acquired financial institution.

customer, referral partner or sales partner attrition could cause our financial results to decline.

experience attrition in merchant credit and debit card processing volume resulting from several factors, including business closures,

transfers of merchants’ accounts to our competitors, unsuccessful contract renewal negotiations and account closures that we initiate

for various reasons, such as heightened credit risks or contract breaches by merchants.

In addition, if an existing sales partner switches

to another payment processor, terminates our services, internalizes payment processing functions that we perform, merges with or is acquired

by one of our competitors, or shuts down or becomes insolvent, we may no longer receive new customer referrals from the sales partner,

and we risk losing existing merchants that were originally enrolled by the sales partner.

We cannot predict the level of attrition in

the future and it could increase.

Our referral partners are a significant source of new business.

Higher than expected attrition could

adversely affect our business, financial condition or results of operations.

A significant number of our merchants are

small- and medium-sized businesses and small affiliates of large companies, which can be more difficult and costly to retain than larger

enterprises and may increase the impact of economic fluctuations on us.

We market and sell our products and services to,

among others, small and midsized businesses (“SMBs”) and small affiliates of large companies.

To continue to grow our revenue,

we must add merchants, sell additional services to existing merchants and encourage existing merchants to continue doing business with

However, retaining SMBs can be more difficult than retaining large enterprises as SMB merchants:

often have higher rates of business failures and more limited resources;

are typically less sophisticated in their ability to make technology-related decisions based on factors other than price;

may have decisions related to the choice of payment processor dictated by their affiliated parent entity;

are more able to change their payment processors than larger organizations dependent on our services.

SMBs are typically more susceptible to the adverse

effects of economic fluctuations (including as a result of epidemics and pandemics).

Adverse changes in the economic environment or business

failures of our SMB merchants may have a greater impact on us than on our competitors who do not focus on SMBs to the extent that we do.

As a result, we may need to attract and retain new merchants at an accelerated rate or decrease our expenses to reduce negative impacts

on our business, financial condition and results of operations.

Our business depends on a strong and trusted

brand, and damage to our reputation, or the reputation of our partners, could adversely affect our business, financial condition or results

In addition, in certain of the markets in which we conduct

business, a substantial portion of our revenue is derived from long-term contracts.

If we are unable to renew our referral partner and

our merchant contracts on favorable terms, or at all, our business, financial condition or results of operations could be adversely affected.

incur chargeback liability when our merchants refuse to or cannot reimburse chargebacks resolved in favor of their customers.

in chargebacks not paid by our merchants may adversely affect our business, financial condition or results of operations.

the event a dispute between a cardholder and a merchant is not resolved in favor of the merchant, the transaction is normally charged

back to the merchant and the purchase price is credited or otherwise refunded to the cardholder.

If we are unable to collect such amounts

from the merchant’s account or reserve account (if applicable), or if the merchant refuses or is unable, due to closure, bankruptcy

or other reasons, to reimburse us for a chargeback, we are responsible for the amount of the refund paid to the cardholder.

of chargebacks is typically greater with those merchants that promise future delivery of goods and services rather than delivering goods

or rendering services at the time of payment, as well as “card not present” transactions in which consumers do not physically

present cards to merchants in connection with the purchase of goods and services, such as E-commerce, telephonic and mobile transactions.

We may experience significant losses from chargebacks in the future.

Any increase in chargebacks not paid by our merchants could have

a material adverse effect on our business, financial condition or results of operations.

We have policies and procedures to monitor and

manage merchant-related credit risks and often mitigate such risks by requiring collateral (such as cash reserves) and monitoring transaction

Notwithstanding our policies and procedures for managing credit risk, it is possible that a default on such obligations by

one or more of our merchants could adversely affect our business, financial condition or results of operations.

to maintain or collect reimbursements from our financial institution referral partners could adversely affect our business.

of our long-term referral arrangements with our financial institution partners permit our bank partners to offer their merchant customers

lower rates for processing services than we typically provide to the general market.

If a bank partner elects to offer these lower rates,

under our contract the partner is required to reimburse us for the full amount of the discount provided to its merchant customers.

Notwithstanding

such contractual commitments, there can be no assurance that these contractual provisions will fully protect us from potential losses

should a bank partner default on its obligations to reimburse us or seek to discontinue such reimbursement obligations in the future.

If we are unable to collect the full amount of any such reimbursements for any reason, we may incur losses.

In addition, any discount

provided by our financial institution partner may cause merchants in these markets to demand lower rates for our services in the future,

which could further reduce our margins or cause us to lose merchants, either of which could adversely affect our business, financial

condition or results of operations.

by merchants or others could adversely affect our business, financial condition or results of operations.

may be liable for certain fraudulent transactions and credits initiated by merchants or others.

Examples of merchant fraud include merchants

or other parties knowingly using a stolen or counterfeit credit or debit card, card number, or other credentials to record a false sales

or credit transaction, processing an invalid card or intentionally failing to deliver the merchandise or services sold in an otherwise

valid transaction.

Criminals are using increasingly sophisticated methods to engage in illegal activities such as counterfeiting and

Failure to effectively manage risk and prevent fraud could increase our chargeback liability or cause us to incur other liabilities.

It is possible that incidents of fraud could increase in the future.

Increases in chargebacks or other liabilities could adversely affect

our business, financial condition or results of operations.

we rely on third-party vendors to provide products and services, we could be adversely impacted if they fail to fulfill their obligations.

depend on third-party vendors and partners to provide us with certain products and services, including components of our computer systems,

software, data centers, “know-your-customer” background checks and telecommunications networks, to conduct our business.

For example, we rely on third parties for services such as organizing and accumulating certain daily transaction data on a merchant-by-merchant

and card issuer-by-card issuer basis and forwarding the accumulated data to the relevant card network.

We also rely on third parties

for specific software and hardware used in providing our products and services.

Some of these organizations and service providers are

our competitors or provide similar services and technology to our competitors, and we do not have long-term or exclusive contracts with

systems and operations or those of our third-party vendors and partners could be exposed to damage or interruption from, among other

things, fire, natural disaster, power loss, telecommunications failure, unauthorized entry, computer viruses, denial-of-service attacks,

acts of terrorism, human error, vandalism or sabotage, financial insolvency, bankruptcy and similar events (including events that are

the result of the COVID-19 pandemic).

In addition, we may be unable to renew our existing contracts with our most significant vendors

and partners or our vendors and partners may stop providing or otherwise supporting the products and services we obtain from them, and

we may not be able to obtain these or similar products or services on the same or similar terms as our existing arrangements, if at all.

The failure of our vendors and partners to perform their obligations and provide the products and services we obtain from them in a timely

manner for any reason could adversely affect our operations and profitability due to, among other consequences:

of merchants and partners;

of merchant and cardholder data;

imposed by card networks;

to our business or reputation resulting from negative publicity;

to fraud losses or other liabilities;

operating and development costs;

of management, technical and other resources.

risk management policies and procedures may not be fully effective in mitigating our risk exposure in all market environments or against

all types of risk.

operate in a rapidly changing industry.

Accordingly, our risk management policies and procedures may not be fully effective to identify,

monitor and manage all risks our business encounters.

If our policies and procedures are not fully effective or we are not successful

in identifying and mitigating all risks to which we are or may be exposed, we may suffer uninsured liability, harm to our reputation

or be subject to litigation or regulatory actions that could adversely affect our business, financial condition or results of operations.

significant number of our merchants are small- and medium-sized businesses and small affiliates of large companies, which can be more

difficult and costly to retain than larger enterprises and may increase the impact of economic fluctuations on us.

market and sell our products and services to, among others, small and midsized businesses (“SMBs”) and small affiliates of

large companies.

To continue to grow our revenue, we must add merchants, sell additional services to existing merchants and encourage

existing merchants to continue doing business with us.

However, retaining SMBs can be more difficult than retaining large enterprises

as SMB merchants:

have higher rates of business failures and more limited resources;

typically less sophisticated in their ability to make technology-related decisions based on factors other than price;

have decisions related to the choice of payment processor dictated by their affiliated parent entity;

more able to change their payment processors than larger organizations dependent on our services.

are typically more susceptible to the adverse effects of economic fluctuations (including as a result of epidemics and pandemics).

changes in the economic environment or business failures of our SMB merchants may have a greater impact on us than on our competitors

who do not focus on SMBs to the extent that we do.

As a result, we may need to attract and retain new merchants at an accelerated rate

or decrease our expenses to reduce negative impacts on our business, financial condition and results of operations.

business depends on a strong and trusted brand, and damage to our reputation, or the reputation of our partners, could adversely affect

our business, financial condition or results of operations.

market our products and services under our brand or the brand of our partners, or both, and we must protect and grow the value of our

brand to continue to be successful in the future.

If an incident were to occur that damages our reputation, or the reputation of our

partners, in any of our major markets, the value of our brand could be adversely affected and our business could be damaged.

ability to recruit, retain and develop qualified personnel is critical to our success and growth.

of our businesses function at the intersection of rapidly changing technological, social, economic and regulatory environments that require

a wide range of expertise and intellectual capital.

For us to successfully compete and grow, we must recruit, retain and develop personnel

who can provide the necessary expertise across a broad spectrum of intellectual capital needs.

In addition, we must develop, maintain

and, as necessary, implement appropriate succession plans to assure we have the necessary human resources capable of maintaining continuity

in our business.

The market for qualified personnel is competitive and we may not succeed in recruiting additional personnel or may fail

to effectively replace current personnel who depart with qualified or effective successors.

Our effort to retain and develop personnel

may also result in significant additional expenses, which could adversely affect our profitability.

We cannot assure that key personnel,

including our executive officers, will continue to be employed or that we will be able to attract and retain qualified personnel in the

Failure to recruit, retain or develop qualified personnel could adversely affect our business, financial condition or results

of operations.

We market our products and services under our

brand or the brand of our partners, or both, and we must protect and grow the value of our brand to continue to be successful in the future.

If an incident were to occur that damages our reputation, or the reputation of our partners, in any of our major markets, the value of

our brand could be adversely affected and our business could be damaged.

Our ability to recruit, retain and develop

qualified personnel is critical to our success and growth.

All of our businesses function at the intersection

of rapidly changing technological, social, economic and regulatory environments that require a wide range of expertise and intellectual

For us to successfully compete and grow, we must recruit, retain and develop personnel who can provide the necessary expertise

across a broad spectrum of intellectual capital needs.

In addition, we must develop, maintain and, as necessary, implement appropriate

succession plans to assure we have the necessary human resources capable of maintaining continuity in our business.

The market for qualified

personnel is competitive and we may not succeed in recruiting additional personnel or may fail to effectively replace current personnel

who depart with qualified or effective successors.

Our effort to retain and develop personnel may also result in significant additional

expenses, which could adversely affect our profitability.

We cannot assure that key personnel, including our executive officers, will

continue to be employed or that we will be able to attract and retain qualified personnel in the future.

Failure to recruit, retain or

develop qualified personnel could adversely affect our business, financial condition or results of operations.

There may be a decline in the use of cards

as a payment mechanism for consumers or adverse developments with respect to the card industry in general.

If consumers do not continue to use credit or

debit cards as a payment mechanism for their transactions or if there is a change in the mix of payments between cash, credit cards and

debit cards or newly emerging alternatives such as Apple Pay, Google Pay and cryptocurrency, our business could be adversely affected.

Consumer credit risk may make it more difficult or expensive for consumers to gain access to credit facilities such as credit cards.

changes may result in financial institutions seeking to charge their customers additional fees for use of credit or debit cards.

fees may result in decreased use of credit or debit cards by cardholders.

Additionally, if market conditions lead to consumers spending

less generally, for example, during an epidemic or pandemic, there will be a decline in the use of credit or debit cards.

We believe future

growth in the use of credit and debit cards and other electronic payments will be driven by the cost, ease-of-use and quality of services

offered to consumers and businesses.

In order to consistently increase and maintain our profitability, consumers and businesses must continue

to use electronic payment methods that we process, including credit and debit cards.

Increases in card network fees and other

changes to fee arrangements may result in the loss of merchants or a reduction in our earnings.

From time to time, card networks, including Visa

and MasterCard, increase the fees that they charge processors.

We typically will attempt to pass these increases along to our merchants,

but this strategy might result in the loss of merchants to our competitors who do not pass along the increases.

If competitive practices

prevent us from passing along the higher fees to our merchants in the future, we may have to absorb all or a portion of such increases,

which may increase our operating costs and reduce our earnings.

In addition, in certain of our markets, card issuers

pay merchant acquirers, such as us, fees based on debit card usage in an effort to encourage debit card use.

If these card issuers discontinue

this practice, our revenue and margins in these jurisdictions could be adversely affected.

If we fail to comply with the applicable

requirements of card networks, they could seek to fine us, suspend us or terminate our registrations.

If our merchants or sales partners

incur fines or penalties that we cannot collect from them, we may have to bear the cost of such fines or penalties.

In order to provide our transaction processing

services, several of our subsidiaries are registered with Visa and MasterCard and other card networks as members or service providers

for member institutions.

Visa, MasterCard, and other card networks, set the rules and standards with which we must comply.

The termination

of our member registration or our status as a certified service provider, or any changes in network rules or standards, including interpretation

and implementation of the rules or standards, that increase the cost of doing business or limit our ability to provide transaction processing

services to or through our merchants or partners, could adversely affect our business, financial condition or results of operations.

As such, we and our merchants are subject to card

network rules that could subject us or our merchants to a variety of fines or penalties that may be levied by card networks for certain

acts or omissions by us.

The rules of card networks are set by their boards, which may be influenced by card issuers, and some of those

issuers are our competitors with respect to these processing services.

Many banks directly or indirectly sell processing services to merchants

in direct competition with us.

These banks could attempt, by virtue of their influence on the networks, to alter the networks’ rules

or policies to the detriment of non-members including certain of our businesses.

The termination of our registrations or our status as

a service provider or a merchant processor, or any changes in network rules or standards, including interpretation and implementation

of the rules or standards, that increase the cost of doing business or limit our ability to provide transaction processing services to

our merchants, could adversely affect our business, financial condition or results of operations.

If a merchant or sales partner fails

to comply with the applicable requirements of card networks, it could be subject to a variety of fines or penalties that may be levied

by card networks.

If we cannot collect the amounts from the applicable merchant or sales partner, we may have to bear the cost of the

fines or penalties, resulting in lower earnings for us.

The termination of our registration, or any changes in card network rules that

would impair our registration, could require us to stop providing payment processing services relating to the affected card network, which

would adversely affect our ability to conduct our business.

OMNISOFT.IO, INC.

Our growth may not be sustainable and depends

on our ability to attract new merchants, retain existing merchants and increase sales to both new and existing merchants.

Our OmniSoft subsidiary principally generates

revenues through the sale of subscriptions to our platform and the sale of additional solutions to our merchants.

Our subscription plans

typically have a one-month term, although a small percentage of our merchants have annual or multi-year subscription terms.

Our merchants

have no obligation to renew their subscriptions after their subscription term expires.

As a result, even though the number of merchants

using our platform has grown rapidly in recent years, there can be no assurance that we will be able to retain these merchants.

historically experienced merchant turnover as a result of many of our merchants being small- and medium-sized businesses, or SMBs, that

are more susceptible than larger businesses to general economic conditions and other risks affecting their businesses.

Many of these SMBs

are in the entrepreneurial stage of their development and there is no guarantee that their businesses will succeed.

Our costs associated

with subscription renewals are substantially lower than costs associated with generating revenue from new merchants or costs associated

with generating sales of additional solutions to existing merchants.

Therefore, if we are unable to retain merchants or if we are unable

to increase revenues from existing merchants, even if such losses are offset by an increase in new merchants or an increase in other revenues,

our operating results could be adversely impacted.

We may also fail to attract new merchants, retain

existing merchants or increase sales to both new and existing merchants as a result of a number of other factors, including:

in our current or potential merchants’ spending levels;

competitive factors affecting the software as a service, or SaaS, business

software applications market, including the introduction of competing platforms, discount pricing and other strategies that may be implemented

by our competitors;

our ability to execute on our growth strategy and operating plans;

a decline in our merchants’ level of satisfaction

with our platform and merchants’ usage of our platform;

the difficulty and cost to switch to a competitor may not be significant

for many of our merchants;

changes in our relationships with third parties, including our partners, app developers, theme designers, referral

sources and payment processors;

the timeliness and success of new products and services we may offer in the future;

the frequency and

severity of any system outages;

may be a decline in the use of cards as a payment mechanism for consumers or adverse developments with respect to the card industry in

consumers do not continue to use credit or debit cards as a payment mechanism for their transactions or if there is a change in the mix

of payments between cash, credit cards and debit cards or newly emerging alternatives such as Apple Pay, Google Pay and cryptocurrency,

our business could be adversely affected.

Consumer credit risk may make it more difficult or expensive for consumers to gain access to

credit facilities such as credit cards.

Regulatory changes may result in financial institutions seeking to charge their customers additional

fees for use of credit or debit cards.

Such fees may result in decreased use of credit or debit cards by cardholders.

Additionally, if

market conditions lead to consumers spending less generally, for example, during an epidemic or pandemic, there will be a decline in

the use of credit or debit cards.

We believe future growth in the use of credit and debit cards and other electronic payments will be

driven by the cost, ease-of-use and quality of services offered to consumers and businesses.

In order to consistently increase and maintain

our profitability, consumers and businesses must continue to use electronic payment methods that we process, including credit and debit

in card network fees and other changes to fee arrangements may result in the loss of merchants or a reduction in our earnings.

time to time, card networks, including Visa and MasterCard, increase the fees that they charge processors.

We typically will attempt

to pass these increases along to our merchants, but this strategy might result in the loss of merchants to our competitors who do not

pass along the increases.

If competitive practices prevent us from passing along the higher fees to our merchants in the future, we may

have to absorb all or a portion of such increases, which may increase our operating costs and reduce our earnings.

addition, in certain of our markets, card issuers pay merchant acquirers, such as us, fees based on debit card usage in an effort to

encourage debit card use.

If these card issuers discontinue this practice, our revenue and margins in these jurisdictions could be adversely

we fail to comply with the applicable requirements of card networks, they could seek to fine us, suspend us or terminate our registrations.

If our merchants or sales partners incur fines or penalties that we cannot collect from them, we may have to bear the cost of such fines

or penalties.

order to provide our transaction processing services, several of our subsidiaries are registered with Visa and MasterCard and other card

networks as members or service providers for member institutions.

Visa, MasterCard, and other card networks, set the rules and standards

with which we must comply.

The termination of our member registration or our status as a certified service provider, or any changes in

network rules or standards, including interpretation and implementation of the rules or standards, that increase the cost of doing business

or limit our ability to provide transaction processing services to or through our merchants or partners, could adversely affect our business,

financial condition or results of operations.

such, we and our merchants are subject to card network rules that could subject us or our merchants to a variety of fines or penalties

that may be levied by card networks for certain acts or omissions by us.

The rules of card networks are set by their boards, which may

be influenced by card issuers, and some of those issuers are our competitors with respect to these processing services.

Many banks directly

or indirectly sell processing services to merchants in direct competition with us.

These banks could attempt, by virtue of their influence

on the networks, to alter the networks’ rules or policies to the detriment of non-members including certain of our businesses.

The termination of our registrations or our status as a service provider or a merchant processor, or any changes in network rules or

standards, including interpretation and implementation of the rules or standards, that increase the cost of doing business or limit our

ability to provide transaction processing services to our merchants, could adversely affect our business, financial condition or results

of operations.

If a merchant or sales partner fails to comply with the applicable requirements of card networks, it could be subject

to a variety of fines or penalties that may be levied by card networks.

If we cannot collect the amounts from the applicable merchant

or sales partner, we may have to bear the cost of the fines or penalties, resulting in lower earnings for us.

The termination of our

registration, or any changes in card network rules that would impair our registration, could require us to stop providing payment processing

services relating to the affected card network, which would adversely affect our ability to conduct our business.

growth may not be sustainable and depends on our ability to attract new merchants, retain existing merchants and increase sales to both

new and existing merchants.

OmniSoft subsidiary principally generates revenues through the sale of subscriptions to our platform and the sale of additional solutions

to our merchants.

Our subscription plans typically have a one-month term, although a small percentage of our merchants have annual or

multi-year subscription terms.

Our merchants have no obligation to renew their subscriptions after their subscription term expires.

a result, even though the number of merchants using our platform has grown rapidly in recent years, there can be no assurance that we

will be able to retain these merchants.

We have historically experienced merchant turnover as a result of many of our merchants being

small- and medium-sized businesses, or SMBs, that are more susceptible than larger businesses to general economic conditions and other

risks affecting their businesses.

Many of these SMBs are in the entrepreneurial stage of their development and there is no guarantee

that their businesses will succeed.

Our costs associated with subscription renewals are substantially lower than costs associated with

generating revenue from new merchants or costs associated with generating sales of additional solutions to existing merchants.

if we are unable to retain merchants or if we are unable to increase revenues from existing merchants, even if such losses are offset

by an increase in new merchants or an increase in other revenues, our operating results could be adversely impacted.

may also fail to attract new merchants, retain existing merchants or increase sales to both new and existing merchants as a result of

a number of other factors, including:

reductions in our current or potential merchants’ spending levels;

competitive factors affecting

the software as a service, or SaaS, business software applications market, including the introduction of competing platforms, discount

pricing and other strategies that may be implemented by our competitors;

our ability to execute on our growth strategy and operating

a decline in our merchants’ level of satisfaction with our platform and merchants’ usage of our platform;

the difficulty

and cost to switch to a competitor may not be significant for many of our merchants;

changes in our relationships with third parties,

including our partners, app developers, theme designers, referral sources and payment processors;

the timeliness and success of new products

and services we may offer in the future;

the frequency and severity of any system outages;

technological change;

and our focus on long-term value over short-term results, meaning that we may make

strategic decisions that may not maximize our short-term revenue or profitability if we believe that the decisions are consistent with

our mission and will improve our financial performance over the long-term.

Additionally, we anticipate that our growth rate

will decline over time to the extent that the number of merchants using our platform increases and we achieve higher market penetration

To the extent our growth rate slows, our business performance will become increasingly dependent on our ability to retain existing

merchants and increase sales to existing merchants.

If we fail to improve and enhance the functionality,

performance, reliability, design, security and scalability of our platform in a manner that responds to our merchants’ evolving

needs, our business may be adversely affected.

The markets in which we compete are characterized

by constant change and innovation and we expect them to continue to evolve rapidly.

Our success has been based on our ability to identify

and anticipate the needs of our merchants and design a platform that provides them with the tools they need to operate their businesses.

Our ability to attract new merchants, retain existing merchants and increase sales to both new and existing merchants will depend in large

part on our ability to continue to improve and enhance the functionality, performance, reliability, design, security and scalability of

our platform.

We may experience difficulties with software development

that could delay or prevent the development, introduction or implementation of new solutions and enhancements.

Software development involves

a significant amount of time for our research and development team, as it can take our developers months to update, code and test new

and upgraded solutions and integrate them into our platform.

We must also continually update, test and enhance our software platform.

For example, our design team spends a significant amount of time and resources incorporating various design enhancements, such as customized

colors, fonts, content and other features, into our platform.

The continual improvement and enhancement of our platform requires significant

investment and we may not have the resources to make such investment.

Our improvements and enhancements may not result in our ability

to recoup our investments in a timely manner, or at all.

To the extent we are not able to improve and enhance the functionality, performance,

reliability, design, security and scalability of our platform in a manner that responds to our merchants’ evolving needs, our business,

operating results and financial condition will be adversely affected.

We store personally identifiable information

of our merchants and their customers.

If the security of this information is compromised or otherwise subjected to unauthorized access,

our reputation may be harmed and we may be exposed to liability.

We store personally identifiable information,

credit card information and other confidential information of our merchants and their customers.

The third-party apps sold on our platform

may also store personally identifiable information, credit card information and other confidential information of our merchants and their

We do not regularly monitor or review the content that our merchants upload and store and, therefore, do not control the substance

of the content on our servers, which may include personal information.

We may experience successful attempts by third parties to obtain

unauthorized access to the personally identifiable information of our merchants and their customers.

This information could also be otherwise

exposed through human error, malfeasance or otherwise.

The unauthorized access or compromise of this personally identifiable information

could have a material adverse effect on our business, financial condition and results of operations.

Even if such a data breach were to

affect one or more of our competitors, the resulting consumer concern could negatively affect our merchants and our business.

We are also subject to federal, state, provincial

and foreign laws regarding privacy and protection of data.

Some jurisdictions have enacted laws requiring companies to notify individuals

of data security breaches involving certain types of personal data and our agreements with certain merchants require us to notify them

in the event of a security incident.

We post on our website our privacy policy and terms of service, which describe our practices concerning

the use, transmission and disclosure of merchant data and data relating to their customers.

In addition, the interpretation of data protection

laws in the United States, and elsewhere, and their application to the internet, is unclear and in a state of flux.

There is a risk that

these laws may be interpreted and applied in conflicting ways from jurisdiction to jurisdiction, and in a manner that is not consistent

with our current data protection practices.

Changes to such data protection laws may impose more stringent requirements for compliance

and impose significant penalties for non-compliance.

Any such new laws or regulations, or changing interpretations of existing laws and

regulations, may cause us to incur significant costs and expend significant effort to ensure compliance.

Because our services are accessible

worldwide, certain foreign jurisdictions may claim that we are required to comply with their laws, including in jurisdictions where we

have no local entity, employees or infrastructure.

Our failure to comply with federal, state, provincial

and foreign laws regarding privacy and protection of data could lead to significant fines and penalties imposed by regulators, as well

as claims by our merchants or their customers.

These proceedings or violations could force us to spend money in defense or settlement

of these proceedings, result in the imposition of monetary liability, diversion of management’s time and attention, increase our

costs of doing business, and materially adversely affect our reputation and the demand for our solutions.

In addition, if our security

measures fail to protect credit card information adequately, we could be liable to both our merchants and their customers for their losses,

as well as our payments processing partners under our agreements with them.

As a result, we could be subject to fines and higher transaction

fees, we could face regulatory action, and our merchants could end their relationships with us.

There can be no assurance that the limitations

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

respect to any particular claim.

We also cannot be sure that our existing insurance coverage and coverage for errors and omissions will

continue to be available on acceptable terms or will be available in sufficient amounts to cover one or more large claims, or that our

insurers will not deny coverage as to any future claim.

The successful assertion of one or more large claims against us that exceeds our

available insurance coverage, or changes in our insurance policies, including premium increases or the imposition of large deductible

or co-insurance requirements, could have an adverse effect on our business, financial condition and results of operations.

If our software contains serious errors

or defects, we may lose revenue and market acceptance and may incur costs to defend or settle claims with our merchants.

Software such as ours often contains errors, defects,

security vulnerabilities or software bugs that are difficult to detect and correct, particularly when first introduced or when new versions

or enhancements are released.

Despite internal testing, our platform may contain serious errors or defects, security vulnerabilities or

software bugs that we may be unable to successfully correct in a timely manner or at all, which could result in lost revenue, significant

expenditures of capital, a delay or loss in market acceptance and damage to our reputation and brand, any of which could have an adverse

effect on our business, financial condition and results of operations.

Furthermore, our platform is a multi-tenant cloud based system

that allows us to deploy new versions and enhancements to all of our merchants simultaneously.

To the extent we deploy new versions or

enhancements that contain errors, defects, security vulnerabilities or software bugs to all of our merchants simultaneously, the consequences

would be more severe than if such versions or enhancements were only deployed to a smaller number of our merchants.

Since our merchants use our services for processes

that are critical to their businesses, errors, defects, security vulnerabilities, service interruptions or software bugs in our platform

could result in losses to our merchants.

Our merchants may seek significant compensation from us for any losses they suffer or cease conducting

business with us altogether.

Further, a merchant could share information about bad experiences on social media, which could result in

damage to our reputation and loss of future sales.

There can be no assurance that provisions typically included in our agreements with

our merchants that attempt to limit our exposure to claims would be enforceable or adequate or would otherwise protect us from liabilities

or damages with respect to any particular claim.

Even if not successful, a claim brought against us by any of our merchants would likely

be time-consuming and costly to defend and could seriously damage our reputation and brand, making it harder for us to sell our solutions.

We may be unable to achieve or maintain

data transmission capacity.

Our merchants often draw significant numbers of

consumers to their shops over short periods of time, including from events such as new product releases, holiday shopping seasons and

flash sales, which significantly increases the traffic on our servers and the volume of transactions processed on our platform.

may be unable to achieve or maintain data transmission capacity high enough to handle increased traffic or process orders in a timely

Our failure to achieve or maintain high data transmission capacity could significantly reduce demand for our solutions.

future, we may be required to allocate resources, including spending substantial amounts of money, to build, purchase or lease additional

data centers and equipment and upgrade our technology and network infrastructure in order to handle the increased load.

Our ability to

deliver our solutions also depends on the development and maintenance of internet infrastructure by third-parties, including the maintenance

of reliable networks with the necessary speed, data capacity and bandwidth.

If one of these third-parties suffers from capacity constraints,

our business may be adversely affected.

In addition, because we and our merchants generate a disproportionate amount of revenue in the

fourth quarter, any disruption in our merchants’ ability to process and fulfill customer orders in the fourth quarter could have

a disproportionately negative effect on our operating results.

Our growth depends in part on the success

of our strategic relationships with third parties.

We anticipate that the growth of our business

will continue to depend on third-party relationships, including relationships with our app developers, theme designers, referral sources,

resellers, payment processors and other partners.

In addition to growing our third-party partner ecosystem, we intend to pursue additional

relationships with other third-parties, such as technology and content providers and implementation consultants.

Identifying, negotiating

and documenting relationships with third parties requires significant time and resources as does integrating third-party content and technology.

Some of the third parties that sell our services have the direct contractual relationships with the merchants, and therefore we risk the

loss of such merchants if the third parties fail to perform their obligations.

Our agreements with providers of cloud hosting, technology,

content and consulting services are typically non-exclusive and do not prohibit such service providers from working with our competitors

or from offering competing services.

These third-party providers may choose to terminate their relationship with us or to make material

changes to their businesses, products or services.

Our competitors may be effective in providing incentives to third parties to favor

their products or services or to prevent or reduce subscriptions to our platform.

In addition, these providers may not perform as expected

under our agreements or under their agreements with our merchants, and we or our merchants may in the future have disagreements or disputes

with such providers.

If we lose access to products or services from a particular supplier, or experience a significant disruption in the

supply of products or services from a current supplier, especially a single-source supplier, it could have an adverse effect on our business

and operating results.

If we fail to maintain a consistently high

level of customer service, our brand, business and financial results may be harmed.

We believe our focus on customer service and support

is critical to onboarding new merchants and retaining our existing merchants and growing our business.

As a result, we have invested heavily

in the quality and training of our support team along with the tools they use to provide this service.

If we are unable to maintain a

consistently high level of customer service, we may lose existing merchants.

In addition, our ability to attract new merchants is highly

dependent on our reputation and on positive recommendations from our existing merchants.

Any failure to maintain a consistently high level

of customer service, or a market perception that we do not maintain high-quality customer service, could adversely affect our reputation

and the number of positive merchant referrals that we receive.

We use a limited number of data centers

to deliver our services.

and our focus on long-term

value over short-term results, meaning that we may make strategic decisions that may not maximize our short-term revenue or profitability

if we believe that the decisions are consistent with our mission and will improve our financial performance over the long-term.

Additionally,

we anticipate that our growth rate will decline over time to the extent that the number of merchants using our platform increases and

we achieve higher market penetration rates.

To the extent our growth rate slows, our business performance will become increasingly dependent

on our ability to retain existing merchants and increase sales to existing merchants.

we fail to improve and enhance the functionality, performance, reliability, design, security and scalability of our platform in a manner

that responds to our merchants’ evolving needs, our business may be adversely affected.

markets in which we compete are characterized by constant change and innovation and we expect them to continue to evolve rapidly.

success has been based on our ability to identify and anticipate the needs of our merchants and design a platform that provides them

with the tools they need to operate their businesses.

Our ability to attract new merchants, retain existing merchants and increase sales

to both new and existing merchants will depend in large part on our ability to continue to improve and enhance the functionality, performance,

reliability, design, security and scalability of our platform.

may experience difficulties with software development that could delay or prevent the development, introduction or implementation of

new solutions and enhancements.

Software development involves a significant amount of time for our research and development team, as

it can take our developers months to update, code and test new and upgraded solutions and integrate them into our platform.

continually update, test and enhance our software platform.

For example, our design team spends a significant amount of time and resources

incorporating various design enhancements, such as customized colors, fonts, content and other features, into our platform.

The continual

improvement and enhancement of our platform requires significant investment and we may not have the resources to make such investment.

Our improvements and enhancements may not result in our ability to recoup our investments in a timely manner, or at all.

To the extent

we are not able to improve and enhance the functionality, performance, reliability, design, security and scalability of our platform

in a manner that responds to our merchants’ evolving needs, our business, operating results and financial condition will be adversely

store personally identifiable information of our merchants and their customers.

If the security of this information is compromised or

otherwise subjected to unauthorized access, our reputation may be harmed and we may be exposed to liability.

store personally identifiable information, credit card information and other confidential information of our merchants and their customers.

The third-party apps sold on our platform may also store personally identifiable information, credit card information and other confidential

information of our merchants and their customers.

We do not regularly monitor or review the content that our merchants upload and store

and, therefore, do not control the substance of the content on our servers, which may include personal information.

We may experience

successful attempts by third parties to obtain unauthorized access to the personally identifiable information of our merchants and their

This information could also be otherwise exposed through human error, malfeasance or otherwise.

The unauthorized access or

compromise of this personally identifiable information could have a material adverse effect on our business, financial condition and

results of operations.

Even if such a data breach were to affect one or more of our competitors, the resulting consumer concern could

negatively affect our merchants and our business.

are also subject to federal, state, provincial and foreign laws regarding privacy and protection of data.

Some jurisdictions have enacted

laws requiring companies to notify individuals of data security breaches involving certain types of personal data and our agreements

with certain merchants require us to notify them in the event of a security incident.

We post on our website our privacy policy and terms

of service, which describe our practices concerning the use, transmission and disclosure of merchant data and data relating to their

In addition, the interpretation of data protection laws in the United States, and elsewhere, and their application to the

internet, is unclear and in a state of flux.

There is a risk that these laws may be interpreted and applied in conflicting ways from

jurisdiction to jurisdiction, and in a manner that is not consistent with our current data protection practices.

Changes to such data

protection laws may impose more stringent requirements for compliance and impose significant penalties for non-compliance.

laws or regulations, or changing interpretations of existing laws and regulations, may cause us to incur significant costs and expend

significant effort to ensure compliance.

Because our services are accessible worldwide, certain foreign jurisdictions may claim that

we are required to comply with their laws, including in jurisdictions where we have no local entity, employees or infrastructure.

failure to comply with federal, state, provincial and foreign laws regarding privacy and protection of data could lead to significant

fines and penalties imposed by regulators, as well as claims by our merchants or their customers.

These proceedings or violations could

force us to spend money in defense or settlement of these proceedings, result in the imposition of monetary liability, diversion of management’s

time and attention, increase our costs of doing business, and materially adversely affect our reputation and the demand for our solutions.

In addition, if our security measures fail to protect credit card information adequately, we could be liable to both our merchants and

their customers for their losses, as well as our payments processing partners under our agreements with them.

As a result, we could be

subject to fines and higher transaction fees, we could face regulatory action, and our merchants could end their relationships with us.

There can be no assurance that the limitations of liability in our contracts would be enforceable or adequate or would otherwise protect

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

We also cannot be sure that our existing insurance coverage

and coverage for errors and omissions will continue to be available on acceptable terms or will be available in sufficient amounts to

cover one or more large claims, or that our insurers will not deny coverage as to any future claim.

The successful assertion of one or

more large claims against us that exceeds our available insurance coverage, or changes in our insurance policies, including premium increases

or the imposition of large deductible or co-insurance requirements, could have an adverse effect on our business, financial condition

and results of operations.

our software contains serious errors or defects, we may lose revenue and market acceptance and may incur costs to defend or settle claims

with our merchants.

such as ours often contains errors, defects, security vulnerabilities or software bugs that are difficult to detect and correct, particularly

when first introduced or when new versions or enhancements are released.

Despite internal testing, our platform may contain serious errors

or defects, security vulnerabilities or software bugs that we may be unable to successfully correct in a timely manner or at all, which

could result in lost revenue, significant expenditures of capital, a delay or loss in market acceptance and damage to our reputation

and brand, any of which could have an adverse effect on our business, financial condition and results of operations.

Furthermore, our

platform is a multi-tenant cloud based system that allows us to deploy new versions and enhancements to all of our merchants simultaneously.

To the extent we deploy new versions or enhancements that contain errors, defects, security vulnerabilities or software bugs to all of

our merchants simultaneously, the consequences would be more severe than if such versions or enhancements were only deployed to a smaller

number of our merchants.

our merchants use our services for processes that are critical to their businesses, errors, defects, security vulnerabilities, service

interruptions or software bugs in our platform could result in losses to our merchants.

Our merchants may seek significant compensation

from us for any losses they suffer or cease conducting business with us altogether.

Further, a merchant could share information about

bad experiences on social media, which could result in damage to our reputation and loss of future sales.

There can be no assurance that

provisions typically included in our agreements with our merchants that attempt to limit our exposure to claims would be enforceable

or adequate or would otherwise protect us from liabilities or damages with respect to any particular claim.

Even if not successful, a

claim brought against us by any of our merchants would likely be time-consuming and costly to defend and could seriously damage our reputation

and brand, making it harder for us to sell our solutions.

may be unable to achieve or maintain data transmission capacity.

merchants often draw significant numbers of consumers to their shops over short periods of time, including from events such as new product

releases, holiday shopping seasons and flash sales, which significantly increases the traffic on our servers and the volume of transactions

processed on our platform.

Our servers may be unable to achieve or maintain data transmission capacity high enough to handle increased

traffic or process orders in a timely manner.

Our failure to achieve or maintain high data transmission capacity could significantly

reduce demand for our solutions.

In the future, we may be required to allocate resources, including spending substantial amounts of money,

to build, purchase or lease additional data centers and equipment and upgrade our technology and network infrastructure in order to handle

the increased load.

Our ability to deliver our solutions also depends on the development and maintenance of internet infrastructure by

third-parties, including the maintenance of reliable networks with the necessary speed, data capacity and bandwidth.

If one of these

third-parties suffers from capacity constraints, our business may be adversely affected.

In addition, because we and our merchants generate

a disproportionate amount of revenue in the fourth quarter, any disruption in our merchants’ ability to process and fulfill customer

orders in the fourth quarter could have a disproportionately negative effect on our operating results.

growth depends in part on the success of our strategic relationships with third parties.

anticipate that the growth of our business will continue to depend on third-party relationships, including relationships with our app

developers, theme designers, referral sources, resellers, payment processors and other partners.

In addition to growing our third-party

partner ecosystem, we intend to pursue additional relationships with other third-parties, such as technology and content providers and

implementation consultants.

Identifying, negotiating and documenting relationships with third parties requires significant time and resources

as does integrating third-party content and technology.

Some of the third parties that sell our services have the direct contractual

relationships with the merchants, and therefore we risk the loss of such merchants if the third parties fail to perform their obligations.

Our agreements with providers of cloud hosting, technology, content and consulting services are typically non-exclusive and do not prohibit

such service providers from working with our competitors or from offering competing services.

These third-party providers may choose

to terminate their relationship with us or to make material changes to their businesses, products or services.

Our competitors may be

effective in providing incentives to third parties to favor their products or services or to prevent or reduce subscriptions to our platform.

In addition, these providers may not perform as expected under our agreements or under their agreements with our merchants, and we or

our merchants may in the future have disagreements or disputes with such providers.

If we lose access to products or services from a

particular supplier, or experience a significant disruption in the supply of products or services from a current supplier, especially

a single-source supplier, it could have an adverse effect on our business and operating results.

we fail to maintain a consistently high level of customer service, our brand, business and financial results may be harmed.

believe our focus on customer service and support is critical to onboarding new merchants and retaining our existing merchants and growing

our business.

As a result, we have invested heavily in the quality and training of our support team along with the tools they use to

provide this service.

If we are unable to maintain a consistently high level of customer service, we may lose existing merchants.

addition, our ability to attract new merchants is highly dependent on our reputation and on positive recommendations from our existing

Any failure to maintain a consistently high level of customer service, or a market perception that we do not maintain high-quality

customer service, could adversely affect our reputation and the number of positive merchant referrals that we receive.

use a limited number of data centers to deliver our services.

Any disruption of service at these facilities could harm our business.

We currently manage our services and serve all

of our merchants from two third-party data center facilities.

While we own the hardware on which our platform runs and deploy this hardware

to the data center facilities, we do not control the operation of these facilities.

We have experienced, and may in the future experience,

failures at the third-party data centers where our hardware is deployed from time to time.

Data centers are vulnerable to damage or interruption

from human error, intentional bad acts, earthquakes, hurricanes, floods, fires, war, terrorist attacks, power losses, hardware failures,

systems failures, telecommunications failures and similar events.

Any of these events could result in lengthy interruptions in our services.

Changes in law or regulations applicable to data centers in various jurisdictions could also cause a disruption in service.

Interruptions

in our services would reduce our revenue, subject us to potential liability and adversely affect our ability to retain our merchants or

attract new merchants.

The performance, reliability and availability of our platform is critical to our reputation and our ability to

attract and retain merchants.

Merchants could share information about bad experiences on social media, which could result in damage to

our reputation and loss of future sales.

The property and business interruption insurance coverage we carry may not be adequate to compensate

us fully for losses that may occur.

Mobile devices are increasingly being used

to conduct commerce, and if our solutions do not operate as effectively when accessed through these devices, our merchants and their customers

may not be satisfied with our services, which could harm our business.

We are dependent on the interoperability of our

platform with third-party mobile devices and mobile operating systems as well as web browsers that we do not control.

Any changes in such

devices, systems or web browsers that degrade the functionality of our platform or give preferential treatment to competitive services

could adversely affect usage of our platform.

Effective mobile functionality is integral to our long-term development and growth strategy.

In the event that our merchants and their customers have difficulty accessing and using our platform on mobile devices, our business and

operating results could be adversely affected.

Our business and prospects would be harmed

if changes to technologies used in our platform or new versions or upgrades of operating systems and internet browsers adversely impact

the process by which merchants and consumers interface with our platform.

We believe the simple and straightforward interface

for our platform has helped us to expand and offer our solutions to merchants with limited technical expertise.

In the future, providers

of internet browsers could introduce new features that would make it difficult for merchants to use our platform.

In addition, internet

browsers for desktop or mobile devices could introduce new features, change existing browser specifications such that they would be incompatible

with our platform, or prevent consumers from accessing our merchants’ shops.

Any changes to technologies used in our platform, to

existing features that we rely on, or to operating systems or internet browsers that make it difficult for merchants to access our platform

or consumers to access our merchants’ shops, may make it more difficult for us to maintain or increase our revenues and could adversely

impact our business and prospects.

The impact of worldwide economic conditions

(including, for example, from the COVID-19 pandemic), including the resulting effect on spending by SMBs, may adversely affect our business,

operating results and financial condition.

A majority of the merchants that use our platform

are SMBs and many of our merchants are in the entrepreneurial stage of their development.

Our performance is subject to worldwide economic

conditions, which may be impacted by, among other things, epidemics and pandemics, and their impact on levels of spending by SMBs and

their customers.

SMBs and entrepreneurs may be disproportionately affected by economic downturns.

SMBs and entrepreneurs frequently have

limited budgets and may choose to allocate their spending to items other than our platform, especially in times of economic uncertainty

or recessions.

Economic downturns, including as a result of epidemics

and pandemics, may also adversely impact retail sales, which could result in merchants who use our platform going out of business or deciding

to stop using our services in order to conserve cash.

Weakening economic conditions may also adversely affect third-parties with whom

we have entered into relationships and upon which we depend in order to grow our business.

Uncertain and adverse economic conditions may

also lead to increased refunds and chargebacks, any of which could adversely affect our business.

We may be subject to claims by third-parties

of intellectual property infringement.

The software industry is characterized by the

existence of a large number of patents and frequent claims and related litigation regarding patents and other intellectual property rights.

Third parties have in the past asserted, and may in the future assert, that our platform, solutions, technology, methods or practices

infringe, misappropriate or otherwise violate their intellectual property or other proprietary rights.

Such claims may be made by our

competitors seeking to obtain a competitive advantage or by other parties.

Additionally, in recent years, non-practicing entities have

begun purchasing intellectual property assets for the purpose of making claims of infringement and attempting to extract settlements from

companies like ours.

The risk of claims may increase as the number of solutions that we offer and competitors in our market increases

and overlaps occur.

In addition, to the extent that we gain greater visibility and market exposure, we face a higher risk of being the

subject of intellectual property infringement claims.

Any such claims, regardless of merit, that result

in litigation could result in substantial expenses, divert the attention of management, cause significant delays in introducing new or

enhanced services or technology, materially disrupt the conduct of our business and have a material and adverse effect on our brand, business,

financial condition and results of operations.

Although we do not believe that our proprietary technology, processes and methods have

been patented by any third party, it is possible that patents have been issued to third parties that cover all or a portion of our business.

As a consequence of any patent or other intellectual property claims, we could be required to pay substantial damages, develop non-infringing

technology, enter into royalty-bearing licensing agreements, stop selling or marketing some or all of our solutions or re-brand our solutions.

We may also be obligated to indemnify our merchants or partners or pay substantial settlement costs, including royalty payments, in connection

with any such claim or litigation and to obtain licenses, modify applications or refund fees, which could be costly.

If it appears necessary,

we may seek to secure license rights to intellectual property that we are alleged to infringe at a significant cost, potentially even

if we believe such claims to be without merit.

If required licenses cannot be obtained, or if existing licenses are not renewed, litigation

could result.

Litigation is inherently uncertain and can cause us to expend significant money, time and attention to it, even if we are

ultimately successful.

Any adverse decision could result in a loss of our proprietary rights, subject us to significant liabilities, require

us to seek licenses for alternative technologies from third-parties, prevent us from offering all or a portion of our solutions and otherwise

negatively affect our business and operating results.

We may be unable to obtain, maintain and

protect our intellectual property rights and proprietary information or prevent third-parties from making unauthorized use of our technology.

Our trade secrets, trademarks, trade dress, domain

names, copyrights, trade secrets and other intellectual property rights are important to our business.

We rely on a combination of confidentiality

clauses, assignment agreements and license agreements with employees and third parties, trade secrets, copyrights and trademarks to protect

our intellectual property and competitive advantage, all of which offer only limited protection.

The steps we take to protect our intellectual

property require significant resources and may be inadequate.

We will not be able to protect our intellectual property if we are unable

to enforce our rights or if we do not detect unauthorized use of our intellectual property.

We may be required to use significant resources

to monitor and protect these rights.

Despite our precautions, it may be possible for unauthorized third parties to copy our platform and

use information that we regard as proprietary to create services that compete with ours.

Some license provisions protecting against unauthorized

use, copying, transfer and disclosure of our proprietary information may be unenforceable under the laws of certain jurisdictions and

foreign countries.

Further, we hold no issued patents and thus would not be entitled to exclude or prevent our competitors from using

our proprietary technology, methods and processes to the extent independently developed by our competitors.

We enter into confidentiality and invention assignment

agreements with our employees and consultants and enter into confidentiality agreements with the parties with whom we have strategic relationships

and business alliances.

No assurance can be given that these agreements will be effective in controlling access to our proprietary information

and trade secrets.

The confidentiality agreements on which we rely to protect certain technologies may be breached, may not be adequate

to protect our confidential information, trade secrets and proprietary technologies and may not provide an adequate remedy in the event

of unauthorized use or disclosure of our confidential information, trade secrets or proprietary technology.

Further, these agreements

do not prevent our competitors or others from independently developing software that is substantially equivalent or superior to our software.

In addition, others may independently discover our trade secrets and confidential information, and in such cases, we likely would not

be able to assert any trade secret rights against such parties.

Additionally, we may from time to time be subject to opposition or similar

proceedings with respect to applications for registrations of our intellectual property, including our trademarks.

While we aim to acquire

adequate protection of our brand through trademark registrations in key markets, occasionally third parties may have already registered

or otherwise acquired rights to identical or similar marks for services that also address our market.

We rely on our brand and trademarks

to identify our platform and to differentiate our platform and services from those of our competitors, and if we are unable to adequately

protect our trademarks third parties may use our brand names or trademarks similar to ours in a manner that may cause confusion in the

market, which could decrease the value of our brand and adversely affect our business and competitive advantages.

Policing unauthorized use of our intellectual

property and misappropriation of our technology and trade secrets is difficult and we may not always be aware of such unauthorized use

or misappropriation.

Despite our efforts to protect our intellectual property rights, unauthorized third-parties may attempt to use, copy

or otherwise obtain and market or distribute our intellectual property rights or technology or otherwise develop services with the same

or similar functionality as our platform.

If our competitors infringe, misappropriate or otherwise misuse our intellectual property rights

and we are not adequately protected, or if our competitors are able to develop a platform with the same or similar functionality as ours

without infringing our intellectual property, our competitive advantage and results of operations could be harmed.

Litigation brought

to protect and enforce our intellectual property rights could be costly, time consuming and distracting to management and could result

in the impairment or loss of portions of our intellectual property.

As a result, we may be aware of infringement by our competitors but

may choose not to bring litigation to enforce our intellectual property rights due to the cost, time and distraction of bringing such

Furthermore, if we do decide to bring litigation, our efforts to enforce our intellectual property rights may be met with

defenses, counterclaims and countersuits challenging or opposing our right to use and otherwise exploit particular intellectual property,

services and technology or the enforceability of our intellectual property rights.

Our inability to protect our proprietary technology

against unauthorized copying or use, as well as any costly litigation or diversion of our management’s attention and resources,

could delay further sales or the implementation of our solutions, impair the functionality of our platform, prevent or delay introductions

of new or enhanced solutions, result in our substituting inferior or more costly technologies into our platform or injure our reputation.

Furthermore, many of our current and potential competitors have the ability to dedicate substantially greater resources to developing

and protecting their technology or intellectual property rights than we do.

Our use of “open source” software

could negatively affect our ability to sell our solutions and subject us to possible litigation.

Our solutions incorporate and are dependent to

a significant extent on the use and development of “open source” software and we intend to continue our use and development

of open source software in the future.

Such open source software is generally licensed by its authors or other third-parties under open

source licenses and is typically freely accessible, usable and modifiable.

Pursuant to such open source licenses, we may be subject to

certain conditions, including requirements that we offer our proprietary software that incorporates the open source software for no cost,

that we make available source code for modifications or derivative works we create based upon, incorporating or using the open source

software and that we license such modifications or derivative works under the terms of the particular open source license.

or other third party that uses or distributes such open source software were to allege that we had not complied with the conditions of

one or more of these licenses, we could be required to incur significant legal expenses defending against such allegations and could be

subject to significant damages, enjoined from the sale of our solutions that contained or are dependent upon the open source software

and required to comply with the foregoing conditions, which could disrupt the distribution and sale of some of our solutions.

could be costly for us to defend, have a negative effect on our operating results and financial condition or require us to devote additional

research and development resources to change our platform.

The terms of many open source licenses to which we are subject have not been

interpreted by U.S.

currently manage our services and serve all of our merchants from two third-party data center facilities.

While we own the hardware on

which our platform runs and deploy this hardware to the data center facilities, we do not control the operation of these facilities.

We have experienced, and may in the future experience, failures at the third-party data centers where our hardware is deployed from time

Data centers are vulnerable to damage or interruption from human error, intentional bad acts, earthquakes, hurricanes, floods,

fires, war, terrorist attacks, power losses, hardware failures, systems failures, telecommunications failures and similar events.

of these events could result in lengthy interruptions in our services.

Changes in law or regulations applicable to data centers in various

jurisdictions could also cause a disruption in service.

Interruptions in our services would reduce our revenue, subject us to potential

liability and adversely affect our ability to retain our merchants or attract new merchants.

The performance, reliability and availability

of our platform is critical to our reputation and our ability to attract and retain merchants.

Merchants could share information about

bad experiences on social media, which could result in damage to our reputation and loss of future sales.

The property and business interruption

insurance coverage we carry may not be adequate to compensate us fully for losses that may occur.

devices are increasingly being used to conduct commerce, and if our solutions do not operate as effectively when accessed through these

devices, our merchants and their customers may not be satisfied with our services, which could harm our business.

are dependent on the interoperability of our platform with third-party mobile devices and mobile operating systems as well as web browsers

that we do not control.

Any changes in such devices, systems or web browsers that degrade the functionality of our platform or give preferential

treatment to competitive services could adversely affect usage of our platform.

Effective mobile functionality is integral to our long-term

development and growth strategy.

In the event that our merchants and their customers have difficulty accessing and using our platform

on mobile devices, our business and operating results could be adversely affected.

business and prospects would be harmed if changes to technologies used in our platform or new versions or upgrades of operating systems

and internet browsers adversely impact the process by which merchants and consumers interface with our platform.

believe the simple and straightforward interface for our platform has helped us to expand and offer our solutions to merchants with limited

technical expertise.

In the future, providers of internet browsers could introduce new features that would make it difficult for merchants

to use our platform.

In addition, internet browsers for desktop or mobile devices could introduce new features, change existing browser

specifications such that they would be incompatible with our platform, or prevent consumers from accessing our merchants’ shops.

Any changes to technologies used in our platform, to existing features that we rely on, or to operating systems or internet browsers

that make it difficult for merchants to access our platform or consumers to access our merchants’ shops, may make it more difficult

for us to maintain or increase our revenues and could adversely impact our business and prospects.

impact of worldwide economic conditions (including, for example, from the COVID-19 pandemic), including the resulting effect on spending

by SMBs, may adversely affect our business, operating results and financial condition.

majority of the merchants that use our platform are SMBs and many of our merchants are in the entrepreneurial stage of their development.

Our performance is subject to worldwide economic conditions, which may be impacted by, among other things, epidemics and pandemics, and

their impact on levels of spending by SMBs and their customers.

SMBs and entrepreneurs may be disproportionately affected by economic

SMBs and entrepreneurs frequently have limited budgets and may choose to allocate their spending to items other than our platform,

especially in times of economic uncertainty or recessions.

downturns, including as a result of epidemics and pandemics, may also adversely impact retail sales, which could result in merchants

who use our platform going out of business or deciding to stop using our services in order to conserve cash.

Weakening economic conditions

may also adversely affect third-parties with whom we have entered into relationships and upon which we depend in order to grow our business.

Uncertain and adverse economic conditions may also lead to increased refunds and chargebacks, any of which could adversely affect our

may be subject to claims by third-parties of intellectual property infringement.

software industry is characterized by the existence of a large number of patents and frequent claims and related litigation regarding

patents and other intellectual property rights.

Third parties have in the past asserted, and may in the future assert, that our platform,

solutions, technology, methods or practices infringe, misappropriate or otherwise violate their intellectual property or other proprietary

Such claims may be made by our competitors seeking to obtain a competitive advantage or by other parties.

Additionally, in recent

years, non-practicing entities have begun purchasing intellectual property assets for the purpose of making claims of infringement and

attempting to extract settlements from companies like ours.

The risk of claims may increase as the number of solutions that we offer

and competitors in our market increases and overlaps occur.

In addition, to the extent that we gain greater visibility and market exposure,

we face a higher risk of being the subject of intellectual property infringement claims.

such claims, regardless of merit, that result in litigation could result in substantial expenses, divert the attention of management,

cause significant delays in introducing new or enhanced services or technology, materially disrupt the conduct of our business and have

a material and adverse effect on our brand, business, financial condition and results of operations.

Although we do not believe that

our proprietary technology, processes and methods have been patented by any third party, it is possible that patents have been issued

to third parties that cover all or a portion of our business.

As a consequence of any patent or other intellectual property claims, we

could be required to pay substantial damages, develop non-infringing technology, enter into royalty-bearing licensing agreements, stop

selling or marketing some or all of our solutions or re-brand our solutions.

We may also be obligated to indemnify our merchants or partners

or pay substantial settlement costs, including royalty payments, in connection with any such claim or litigation and to obtain licenses,

modify applications or refund fees, which could be costly.

If it appears necessary, we may seek to secure license rights to intellectual

property that we are alleged to infringe at a significant cost, potentially even if we believe such claims to be without merit.

licenses cannot be obtained, or if existing licenses are not renewed, litigation could result.

Litigation is inherently uncertain and

can cause us to expend significant money, time and attention to it, even if we are ultimately successful.

Any adverse decision could

result in a loss of our proprietary rights, subject us to significant liabilities, require us to seek licenses for alternative technologies

from third-parties, prevent us from offering all or a portion of our solutions and otherwise negatively affect our business and operating

may be unable to obtain, maintain and protect our intellectual property rights and proprietary information or prevent third-parties from

making unauthorized use of our technology.

trade secrets, trademarks, trade dress, domain names, copyrights, trade secrets and other intellectual property rights are important

to our business.

We rely on a combination of confidentiality clauses, assignment agreements and license agreements with employees and

third parties, trade secrets, copyrights and trademarks to protect our intellectual property and competitive advantage, all of which

offer only limited protection.

The steps we take to protect our intellectual property require significant resources and may be inadequate.

We will not be able to protect our intellectual property if we are unable to enforce our rights or if we do not detect unauthorized use

of our intellectual property.

We may be required to use significant resources to monitor and protect these rights.

Despite our precautions,

it may be possible for unauthorized third parties to copy our platform and use information that we regard as proprietary to create services

that compete with ours.

Some license provisions protecting against unauthorized use, copying, transfer and disclosure of our proprietary

information may be unenforceable under the laws of certain jurisdictions and foreign countries.

Further, we hold no issued patents and

thus would not be entitled to exclude or prevent our competitors from using our proprietary technology, methods and processes to the

extent independently developed by our competitors.

enter into confidentiality and invention assignment agreements with our employees and consultants and enter into confidentiality agreements

with the parties with whom we have strategic relationships and business alliances.

No assurance can be given that these agreements will

be effective in controlling access to our proprietary information and trade secrets.

The confidentiality agreements on which we rely

to protect certain technologies may be breached, may not be adequate to protect our confidential information, trade secrets and proprietary

technologies and may not provide an adequate remedy in the event of unauthorized use or disclosure of our confidential information, trade

secrets or proprietary technology.

Further, these agreements do not prevent our competitors or others from independently developing software

that is substantially equivalent or superior to our software.

In addition, others may independently discover our trade secrets and confidential

information, and in such cases, we likely would not be able to assert any trade secret rights against such parties.

Additionally, we

may from time to time be subject to opposition or similar proceedings with respect to applications for registrations of our intellectual

property, including our trademarks.

While we aim to acquire adequate protection of our brand through trademark registrations in key markets,

occasionally third parties may have already registered or otherwise acquired rights to identical or similar marks for services that also

address our market.

We rely on our brand and trademarks to identify our platform and to differentiate our platform and services from

those of our competitors, and if we are unable to adequately protect our trademarks third parties may use our brand names or trademarks

similar to ours in a manner that may cause confusion in the market, which could decrease the value of our brand and adversely affect

our business and competitive advantages.

unauthorized use of our intellectual property and misappropriation of our technology and trade secrets is difficult and we may not always

be aware of such unauthorized use or misappropriation.

Despite our efforts to protect our intellectual property rights, unauthorized

third-parties may attempt to use, copy or otherwise obtain and market or distribute our intellectual property rights or technology or

otherwise develop services with the same or similar functionality as our platform.

If our competitors infringe, misappropriate or otherwise

misuse our intellectual property rights and we are not adequately protected, or if our competitors are able to develop a platform with

the same or similar functionality as ours without infringing our intellectual property, our competitive advantage and results of operations

could be harmed.

Litigation brought to protect and enforce our intellectual property rights could be costly, time consuming and distracting

to management and could result in the impairment or loss of portions of our intellectual property.

As a result, we may be aware of infringement

by our competitors but may choose not to bring litigation to enforce our intellectual property rights due to the cost, time and distraction

of bringing such litigation.

Furthermore, if we do decide to bring litigation, our efforts to enforce our intellectual property rights

may be met with defenses, counterclaims and countersuits challenging or opposing our right to use and otherwise exploit particular intellectual

property, services and technology or the enforceability of our intellectual property rights.

Our inability to protect our proprietary

technology against unauthorized copying or use, as well as any costly litigation or diversion of our management’s attention and

resources, could delay further sales or the implementation of our solutions, impair the functionality of our platform, prevent or delay

introductions of new or enhanced solutions, result in our substituting inferior or more costly technologies into our platform or injure

our reputation.

Furthermore, many of our current and potential competitors have the ability to dedicate substantially greater resources

to developing and protecting their technology or intellectual property rights than we do.

use of “open source” software could negatively affect our ability to sell our solutions and subject us to possible litigation.

solutions incorporate and are dependent to a significant extent on the use and development of “open source” software and

we intend to continue our use and development of open source software in the future.

Such open source software is generally licensed

by its authors or other third-parties under open source licenses and is typically freely accessible, usable and modifiable.

to such open source licenses, we may be subject to certain conditions, including requirements that we offer our proprietary software

that incorporates the open source software for no cost, that we make available source code for modifications or derivative works we create

based upon, incorporating or using the open source software and that we license such modifications or derivative works under the terms

of the particular open source license.

If an author or other third party that uses or distributes such open source software were to allege

that we had not complied with the conditions of one or more of these licenses, we could be required to incur significant legal expenses

defending against such allegations and could be subject to significant damages, enjoined from the sale of our solutions that contained

or are dependent upon the open source software and required to comply with the foregoing conditions, which could disrupt the distribution

and sale of some of our solutions.

Litigation could be costly for us to defend, have a negative effect on our operating results and financial

condition or require us to devote additional research and development resources to change our platform.

The terms of many open source

licenses to which we are subject have not been interpreted by U.S.

or foreign courts.

As there is little or no legal precedent governing the interpretation of many of the terms of certain

of these licenses, the potential impact of these terms on our business is uncertain and may result in unanticipated obligations regarding

our solutions and technologies.

It is our view that we do not distribute our software, since no installation of our software is necessary

and our platform is accessible solely through the “cloud.” Nevertheless, this position could be challenged.

Any requirement

to disclose our proprietary source code, termination of open source license rights or payments of damages for breach of contract could

be harmful to our business, results of operations or financial condition, and could help our competitors develop products and services

that are similar to or better than ours.

In addition to risks related to license requirements,

usage of open source software can lead to greater risks than the use of third-party commercial software, as open source licensors generally

do not provide warranties, controls on the origin or development of the software, or remedies against the licensors.

Many of the risks

associated with usage of open source software cannot be eliminated and could adversely affect our business.

Although we believe that we have complied with

our obligations under the various applicable licenses for open source software, it is possible that we may not be aware of all instances

where open source software has been incorporated into our proprietary software or used in connection with our solutions or our corresponding

obligations under open source licenses.

We do not have robust open source software usage policies or monitoring procedures in place.

rely on multiple software programmers to design our proprietary software and we cannot be certain that our programmers have not incorporated

open source software into our proprietary software that we intend to maintain as confidential or that they will not do so in the future.

To the extent that we are required to disclose the source code of certain of our proprietary software developments to third-parties, including

our competitors, in order to comply with applicable open source license terms, such disclosure could harm our intellectual property position,

competitive advantage, results of operations and financial condition.

In addition, to the extent that we have failed to comply with our

obligations under particular licenses for open source software, we may lose the right to continue to use and exploit such open source

software in connection with our operations and solutions, which could disrupt and adversely affect our business.

We rely on search engines and social networking

sites to attract a meaningful portion of our merchants.

If we are not able to generate traffic to our website through search engines and

social networking sites, our ability to attract new merchants may be impaired.

In addition, if our merchants are not able to generate

traffic to their shops through search engines and social networking sites, their ability to attract consumers may be impaired.

Many of our merchants locate our website through

internet search engines, such as Google, and advertisements on social networking sites, such as Facebook.

The prominence of our website

in response to internet searches is a critical factor in attracting potential merchants to our platform.

If we are listed less prominently

or fail to appear in search results for any reason, visits to our website could decline significantly, and we may not be able to replace

this traffic.

Similarly, many consumers locate our merchants’

shops through internet search engines and advertisements on social networking sites.

If our merchants’ shops are listed less prominently

or fail to appear in search results for any reason, visits to our merchants’ shops could decline significantly.

As a result, our

merchants’ businesses may suffer, which would affect the ability of such merchants to pay for our solutions.

Search engines revise their algorithms from time

to time in an attempt to optimize their search results.

If search engines modify their algorithms, our website and our merchants’

shops may appear less prominently or not at all in search results, which could result in reduced traffic to our website and to our merchants’

Additionally, if the price of marketing our solutions

over search engines or social networking sites increases, we may incur additional marketing expenses or may be required to allocate a

larger portion of our marketing spend to search engine marketing and our business and operating results could be adversely affected.

competitors may in the future bid on the search terms that we use to drive traffic to our website.

Such actions could increase our marketing

costs and result in decreased traffic to our website.

In addition, search engines or social networking sites may change their advertising

policies from time to time.

If any change to these policies delays or prevents us from advertising through these channels, it could result

in reduced traffic to our website and sales of our solutions.

As well, new search engines or social networking sites may develop, particularly

in specific jurisdictions that reduce traffic on existing search engines and social networking sites.

And if we are not able to achieve

awareness through advertising or otherwise, we may not achieve significant traffic to our website through these new platforms.

unable to continue to successfully promote and maintain our websites, or if we incur excessive expenses to do so, our business and operating

results could be adversely affected.

Activities of merchants or the content of

their shops could damage our brand, subject us to liability and harm our business and financial results.

Our terms of service prohibit our merchants from

using our platform to engage in illegal activities and our terms of service permit us to take down a merchant’s shop if we become

aware of such illegal use.

Merchants may nonetheless engage in prohibited or illegal activities or upload store content in violation of

applicable laws, which could subject us to liability.

Furthermore, our brand may be negatively impacted by the actions of merchants that

are deemed to be hostile, offensive, inappropriate or illegal.

We do not proactively monitor or review the appropriateness of the content

of our merchants’ shops and we do not have control over merchant activities.

The safeguards we have in place may not be sufficient

for us to avoid liability or avoid harm to our brand, especially if such hostile, offensive, inappropriate or illegal use is high profile,

which could adversely affect our business and financial results.

If third-party apps and themes change such

that we do not or cannot maintain the compatibility of our platform with these apps and themes, or if we fail to provide third-party apps

and themes that our merchants desire to add to their shops, demand for our platform could decline.

The success of our platform depends, in part,

on our ability to integrate third-party apps, themes and other offerings into our third-party ecosystem.

Third-party developers may change

the features of their offerings or alter the terms governing the use of their offerings in a manner that is adverse to us.

If we are unable

to maintain technical interoperation, our merchants may not be able to effectively integrate our platform with other systems and services

We may also be unable to maintain our relationships with certain third-party vendors if we are unable to integrate our platform

with their offerings.

Further, third-party developers may refuse to partner with us or limit or restrict our access to their offerings.

Such changes could functionally limit or terminate our ability to use these third-party offerings with our platform, which could negatively

impact our solution offerings and harm our business.

If we fail to integrate our platform with new third-party offerings that our merchants

need for their shops, or to adapt to the data transfer requirements of such third-party offerings, we may not be able to offer the functionality

that our merchants and their customers expect, which would negatively impact our offerings and, as a result, harm our business.

We rely on computer hardware, purchased

or leased, and software licensed from and services rendered by third parties in order to provide our solutions and run our business, sometimes

by a single-source supplier.

We rely on computer hardware, purchased or leased,

and software licensed from and services rendered by third-parties in order to provide our solutions and run our business, sometimes by

a single-source supplier.

Third-party hardware, software and services may not continue to be available on commercially reasonable terms,

Any loss of the right to use or any failures of third-party hardware, software or services could result in delays in our ability

to provide our solutions or run our business until equivalent hardware, software or services are developed by us or, if available, identified,

obtained and integrated, which could be costly and time-consuming and may not result in an equivalent solution, any of which could cause

an adverse effect on our business and operating results.

Further, merchants could assert claims against us in connection with such service

disruption or cease conducting business with us altogether.

Even if not successful, a claim brought against us by any of our merchants

would likely be time-consuming and costly to defend and could seriously damage our reputation and brand, making it harder for us to sell

our solutions.

We may not be able to compete successfully

against current and future competitors.

We face competition in various aspects of our

business and we expect such competition to intensify in the future, as existing and new competitors introduce new services or enhance

existing services.

We have competitors with longer operating histories, larger customer bases, greater brand recognition, greater experience

and more extensive commercial relationships in certain jurisdictions, and greater financial, technical, marketing and other resources

As a result, our potential competitors may be able to develop products and services better received by merchants or may be

able to respond more quickly and effectively than we can to new or changing opportunities, technologies, regulations or merchant requirements.

In addition, some of our larger competitors may be able to leverage a larger installed customer base and distribution network to adopt

more aggressive pricing policies and offer more attractive sales terms, which could cause us to lose potential sales or to sell our solutions

at lower prices.

Competition may intensify as our competitors enter

into business combinations or alliances or raise additional capital, or as established companies in other market segments or geographic

markets expand into our market segments or geographic markets.

For instance, certain competitors could use strong or dominant positions

in one or more markets to gain a competitive advantage against us in areas where we operate including:

by integrating competing platforms

or features into products they control such as search engines, web browsers, mobile device operating systems or social networks;

acquisitions;

As there is little or no legal precedent governing

the interpretation of many of the terms of certain of these licenses, the potential impact of these terms on our business is uncertain

and may result in unanticipated obligations regarding our solutions and technologies.

It is our view that we do not distribute our software,

since no installation of our software is necessary and our platform is accessible solely through the “cloud.” Nevertheless,

this position could be challenged.

Any requirement to disclose our proprietary source code, termination of open source license rights

or payments of damages for breach of contract could be harmful to our business, results of operations or financial condition, and could

help our competitors develop products and services that are similar to or better than ours.

addition to risks related to license requirements, usage of open source software can lead to greater risks than the use of third-party

commercial software, as open source licensors generally do not provide warranties, controls on the origin or development of the software,

or remedies against the licensors.

Many of the risks associated with usage of open source software cannot be eliminated and could adversely

affect our business.

we believe that we have complied with our obligations under the various applicable licenses for open source software, it is possible

that we may not be aware of all instances where open source software has been incorporated into our proprietary software or used in connection

with our solutions or our corresponding obligations under open source licenses.

We do not have robust open source software usage policies

or monitoring procedures in place.

We rely on multiple software programmers to design our proprietary software and we cannot be certain

that our programmers have not incorporated open source software into our proprietary software that we intend to maintain as confidential

or that they will not do so in the future.

To the extent that we are required to disclose the source code of certain of our proprietary

software developments to third-parties, including our competitors, in order to comply with applicable open source license terms, such

disclosure could harm our intellectual property position, competitive advantage, results of operations and financial condition.

to the extent that we have failed to comply with our obligations under particular licenses for open source software, we may lose the

right to continue to use and exploit such open source software in connection with our operations and solutions, which could disrupt and

adversely affect our business.

rely on search engines and social networking sites to attract a meaningful portion of our merchants.

If we are not able to generate traffic

to our website through search engines and social networking sites, our ability to attract new merchants may be impaired.

if our merchants are not able to generate traffic to their shops through search engines and social networking sites, their ability to

attract consumers may be impaired.

of our merchants locate our website through internet search engines, such as Google, and advertisements on social networking sites, such

The prominence of our website in response to internet searches is a critical factor in attracting potential merchants to

our platform.

If we are listed less prominently or fail to appear in search results for any reason, visits to our website could decline

significantly, and we may not be able to replace this traffic.

many consumers locate our merchants’ shops through internet search engines and advertisements on social networking sites.

merchants’ shops are listed less prominently or fail to appear in search results for any reason, visits to our merchants’

shops could decline significantly.

As a result, our merchants’ businesses may suffer, which would affect the ability of such merchants

to pay for our solutions.

engines revise their algorithms from time to time in an attempt to optimize their search results.

If search engines modify their algorithms,

our website and our merchants’ shops may appear less prominently or not at all in search results, which could result in reduced

traffic to our website and to our merchants’ shops.

Additionally,

if the price of marketing our solutions over search engines or social networking sites increases, we may incur additional marketing expenses

or may be required to allocate a larger portion of our marketing spend to search engine marketing and our business and operating results

could be adversely affected.

Furthermore, competitors may in the future bid on the search terms that we use to drive traffic to our website.

Such actions could increase our marketing costs and result in decreased traffic to our website.

In addition, search engines or social

networking sites may change their advertising policies from time to time.

If any change to these policies delays or prevents us from

advertising through these channels, it could result in reduced traffic to our website and sales of our solutions.

As well, new search

engines or social networking sites may develop, particularly in specific jurisdictions that reduce traffic on existing search engines

and social networking sites.

And if we are not able to achieve awareness through advertising or otherwise, we may not achieve significant

traffic to our website through these new platforms.

If we are unable to continue to successfully promote and maintain our websites, or

if we incur excessive expenses to do so, our business and operating results could be adversely affected.

of merchants or the content of their shops could damage our brand, subject us to liability and harm our business and financial results.

terms of service prohibit our merchants from using our platform to engage in illegal activities and our terms of service permit us to

take down a merchant’s shop if we become aware of such illegal use.

Merchants may nonetheless engage in prohibited or illegal activities

or upload store content in violation of applicable laws, which could subject us to liability.

Furthermore, our brand may be negatively

impacted by the actions of merchants that are deemed to be hostile, offensive, inappropriate or illegal.

We do not proactively monitor

or review the appropriateness of the content of our merchants’ shops and we do not have control over merchant activities.

The safeguards

we have in place may not be sufficient for us to avoid liability or avoid harm to our brand, especially if such hostile, offensive, inappropriate

or illegal use is high profile, which could adversely affect our business and financial results.

third-party apps and themes change such that we do not or cannot maintain the compatibility of our platform with these apps and themes,

or if we fail to provide third-party apps and themes that our merchants desire to add to their shops, demand for our platform could decline.

success of our platform depends, in part, on our ability to integrate third-party apps, themes and other offerings into our third-party

Third-party developers may change the features of their offerings or alter the terms governing the use of their offerings

in a manner that is adverse to us.

If we are unable to maintain technical interoperation, our merchants may not be able to effectively

integrate our platform with other systems and services they use.

We may also be unable to maintain our relationships with certain third-party

vendors if we are unable to integrate our platform with their offerings.

Further, third-party developers may refuse to partner with us

or limit or restrict our access to their offerings.

Such changes could functionally limit or terminate our ability to use these third-party

offerings with our platform, which could negatively impact our solution offerings and harm our business.

If we fail to integrate our

platform with new third-party offerings that our merchants need for their shops, or to adapt to the data transfer requirements of such

third-party offerings, we may not be able to offer the functionality that our merchants and their customers expect, which would negatively

impact our offerings and, as a result, harm our business.

rely on computer hardware, purchased or leased, and software licensed from and services rendered by third parties in order to provide

our solutions and run our business, sometimes by a single-source supplier.

rely on computer hardware, purchased or leased, and software licensed from and services rendered by third-parties in order to provide

our solutions and run our business, sometimes by a single-source supplier.

Third-party hardware, software and services may not continue

to be available on commercially reasonable terms, or at all.

Any loss of the right to use or any failures of third-party hardware, software

or services could result in delays in our ability to provide our solutions or run our business until equivalent hardware, software or

services are developed by us or, if available, identified, obtained and integrated, which could be costly and time-consuming and may

not result in an equivalent solution, any of which could cause an adverse effect on our business and operating results.

Further, merchants

could assert claims against us in connection with such service disruption or cease conducting business with us altogether.

successful, a claim brought against us by any of our merchants would likely be time-consuming and costly to defend and could seriously

damage our reputation and brand, making it harder for us to sell our solutions.

may not be able to compete successfully against current and future competitors.

face competition in various aspects of our business and we expect such competition to intensify in the future, as existing and new competitors

introduce new services or enhance existing services.

We have competitors with longer operating histories, larger customer bases, greater

brand recognition, greater experience and more extensive commercial relationships in certain jurisdictions, and greater financial, technical,

marketing and other resources than we do.

As a result, our potential competitors may be able to develop products and services better

received by merchants or may be able to respond more quickly and effectively than we can to new or changing opportunities, technologies,

regulations or merchant requirements.

In addition, some of our larger competitors may be able to leverage a larger installed customer

base and distribution network to adopt more aggressive pricing policies and offer more attractive sales terms, which could cause us to

lose potential sales or to sell our solutions at lower prices.

may intensify as our competitors enter into business combinations or alliances or raise additional capital, or as established companies

in other market segments or geographic markets expand into our market segments or geographic markets.

For instance, certain competitors

could use strong or dominant positions in one or more markets to gain a competitive advantage against us in areas where we operate including:

by integrating competing platforms or features into products they control such as search engines, web browsers, mobile device operating

systems or social networks;

by making acquisitions;

or by making access to our platform more difficult.

Further, current and future competitors could choose to offer a different

pricing model or to undercut prices in an effort to increase their market share.

We also expect new entrants to offer competitive services.

If we cannot compete successfully against current and future competitors, our business, results of operations and financial condition

could be negatively impacted.

We plan to make future acquisitions and

investments, which could divert management’s attention, result in operating difficulties and dilution to our stockholders and otherwise

disrupt our operations and adversely affect our business, operating results or financial position.

From time to time, we evaluate potential strategic

acquisition or investment opportunities.

Any transactions that we enter into could be material to our financial condition and results

of operations.

The process of acquiring and integrating another company or technology could create unforeseen operating difficulties and

expenditures.

Further, current and future competitors

could choose to offer a different pricing model or to undercut prices in an effort to increase their market share.

We also expect new

entrants to offer competitive services.

If we cannot compete successfully against current and future competitors, our business, results

of operations and financial condition could be negatively impacted.

plan to make future acquisitions and investments, which could divert management’s attention, result in operating difficulties and

dilution to our stockholders and otherwise disrupt our operations and adversely affect our business, operating results or financial position.

time to time, we evaluate potential strategic acquisition or investment opportunities.

Any transactions that we enter into could be material

to our financial condition and results of operations.

The process of acquiring and integrating another company or technology could create

unforeseen operating difficulties and expenditures.

Acquisitions and investments involve a number of risks, such as:

diversion of management time and focus from operating our business;

use of resources that are needed in other areas of our business, including cash resources;

in the case of an acquisition, implementation or remediation of controls, procedures and policies of the acquired company;

in the case of an acquisition, difficulty integrating the accounting systems and operations of the acquired company, including potential risks to our corporate culture;

in the case of an acquisition, coordination of product, engineering and selling and marketing functions, including difficulties and additional expenses associated with supporting legacy services and products and hosting infrastructure of the acquired company and difficulty converting the customers of the acquired company onto our platform and contract terms, including disparities in the revenues, licensing, support or professional services model of the acquired company;

in the case of an acquisition, retention and integration of employees from the acquired company;

unforeseen costs or liabilities;

adverse effects to our existing business relationships with partners and merchants as a result of the acquisition or investment;

the possibility of adverse tax consequences;

litigation or other claims arising in connection with the acquired company or investment.

In addition, we may agree to grant warrants to

a lender under a credit facility.

Furthermore, a significant portion of the purchase price of companies we acquire may be allocated to

acquired goodwill and other intangible assets, which must be assessed for impairment at least annually.

In the future, if our acquisitions

do not yield expected returns, we may be required to take charges to our operating results based on this impairment assessment process,

which could adversely affect our results of operations.

Acquisitions and investments may also result in

dilutive issuances of equity securities, which could adversely affect our share price, or result in the incurrence of debt with restrictive

covenants that limit our future uses of capital in pursuit of business opportunities.

We may not be able to identify acquisition or

investment opportunities that meet our strategic objectives, or to the extent such opportunities are identified, we may not be able to

negotiate terms with respect to the acquisition or investment that are acceptable to us.

At this time, we have made no commitments or

agreements with respect to any such transaction.

New tax laws could be enacted or existing

laws could be applied to us or our merchants, which could increase the costs of our solutions and adversely impact our business.

The application of federal, state, provincial,

local and foreign tax laws to solutions provided over the internet is evolving.

New income, sales, use or other tax laws, statutes, rules,

regulations or ordinances could be enacted at any time, possibly with retroactive effect, and could be applied solely or disproportionately

to solutions provided over the internet.

These enactments could adversely affect our sales activity due to the inherent cost increase

the taxes would represent, and could ultimately result in a negative impact on our results of operations and cash flows.

State tax authorities may seek to assess

state and local business taxes and sales and use taxes.

If we are required to collect sales and use taxes in additional jurisdictions,

we might be subject to tax liability for past sales.

There is a risk that U.S.

states could assert

that we are liable for U.S.

state and local business activity taxes, which are levied upon income or gross receipts, or for the collection

of management time and focus from operating our business;

of resources that are needed in other areas of our business, including cash resources;

the case of an acquisition, implementation or remediation of controls, procedures and policies of the acquired company;

the case of an acquisition, difficulty integrating the accounting systems and operations of the acquired company, including potential

risks to our corporate culture;

the case of an acquisition, coordination of product, engineering and selling and marketing functions, including difficulties and additional

expenses associated with supporting legacy services and products and hosting infrastructure of the acquired company and difficulty converting

the customers of the acquired company onto our platform and contract terms, including disparities in the revenues, licensing, support

or professional services model of the acquired company;

the case of an acquisition, retention and integration of employees from the acquired company;

costs or liabilities;

effects to our existing business relationships with partners and merchants as a result of the acquisition or investment;

possibility of adverse tax consequences;

or other claims arising in connection with the acquired company or investment.

addition, we may agree to grant warrants to a lender under a credit facility.

Furthermore, a significant portion of the purchase price

of companies we acquire may be allocated to acquired goodwill and other intangible assets, which must be assessed for impairment at least

In the future, if our acquisitions do not yield expected returns, we may be required to take charges to our operating results

based on this impairment assessment process, which could adversely affect our results of operations.

and investments may also result in dilutive issuances of equity securities, which could adversely affect our share price, or result in

the incurrence of debt with restrictive covenants that limit our future uses of capital in pursuit of business opportunities.

may not be able to identify acquisition or investment opportunities that meet our strategic objectives, or to the extent such opportunities

are identified, we may not be able to negotiate terms with respect to the acquisition or investment that are acceptable to us.

time, we have made no commitments or agreements with respect to any such transaction.

tax laws could be enacted or existing laws could be applied to us or our merchants, which could increase the costs of our solutions and

adversely impact our business.

application of federal, state, provincial, local and foreign tax laws to solutions provided over the internet is evolving.

sales, use or other tax laws, statutes, rules, regulations or ordinances could be enacted at any time, possibly with retroactive effect,

and could be applied solely or disproportionately to solutions provided over the internet.

These enactments could adversely affect our

sales activity due to the inherent cost increase the taxes would represent, and could ultimately result in a negative impact on our results

of operations and cash flows.

tax authorities may seek to assess state and local business taxes and sales and use taxes.

If we are required to collect sales and use

taxes in additional jurisdictions, we might be subject to tax liability for past sales.

is a risk that U.S.

states could assert that we are liable for U.S.

state and local business activity taxes, which are levied upon income

or gross receipts, or for the collection of U.S.

local sales and use taxes.

This risk exists regardless of whether we are subject to U.S.

This risk exists regardless of whether we are subject to

federal income tax.

States are becoming

increasingly active in asserting nexus for business activity tax purposes and imposing sales and use taxes on products and services provided

over the internet.

States are becoming increasingly active in asserting nexus for business activity tax purposes and imposing sales

and use taxes on products and services provided over the internet.

We may be subject to U.S.

state and local business activity taxes if a state tax authority asserts that our activities

or the activities of our non-U.S.

state and local business activity taxes

if a state tax authority asserts that our activities or the activities of our non-U.S.

subsidiaries are sufficient to establish nexus.

We could also be liable for the collection of U.S.

and local sales and use taxes if a state tax authority asserts that distribution of our solutions over the internet is subject to sales

and use taxes.

Each state has different rules and regulations governing sales and use taxes, and these rules and regulations are subject

to varying interpretations that change over time.

We review these rules and regulations periodically and, when we believe we are subject

to sales and use taxes in a particular state, voluntarily engage state tax authorities in order to determine how to comply with their

rules and regulations.

If a state tax authority asserts that distribution of our solutions is subject to such sales and use taxes, the

additional cost may decrease the likelihood that such merchants would purchase our solutions or continue to renew their subscriptions.

A successful assertion by one or more states requiring

us to collect sales or other taxes on subscription service revenue could result in substantial tax liabilities for past transactions and

otherwise harm our business.

We cannot assure you that we will not be subject to sales and use taxes or related penalties for past sales

in states where we currently believe no such taxes are required.

New obligations to collect or pay taxes of any kind could increase our

cost of doing business.

We are dependent upon consumers’ and

merchants’ willingness to use the internet for commerce.

Our success depends upon the general public’s

continued willingness to use the internet as a means to pay for purchases, communicate, access social media, research and conduct commercial

transactions, including through mobile devices.

If consumers or merchants become unwilling or less willing to use the internet for commerce

for any reason, including lack of access to high-speed communications equipment, congestion of traffic on the internet, internet outages

or delays, disruptions or other damage to merchants’ and consumers’ computers, increases in the cost of accessing the internet

and security and privacy risks or the perception of such risks, our business could be adversely affected.

We may face challenges in expanding into

new geographic regions.

Our future success will depend in part upon our

ability to expand into new geographic regions, and we will face risks entering markets in which we have limited or no experience and in

which we do not have any brand recognition.

Expanding into new geographic regions where the main language is not English will require

substantial expenditures and take considerable time and attention, and we may not be successful enough in these new markets to recoup

our investments in a timely manner, or at all.

Our efforts to expand into new geographic regions may not be successful, which could limit

our ability to grow our business.

Risks Related to Laws and Regulations

Failure to comply with the U.S.

Corrupt Practices Act, or the FCPA, anti-money laundering, economic and trade sanctions regulations, and similar laws could subject us

to penalties and other adverse consequences.

We currently operate our business only in the

United States.

We are subject to anti-corruption laws and regulations, including the FCPA, and other laws that prohibit the making or

offering of improper payments to foreign government officials and political figures, including anti-bribery provisions enforced by the

Department of Justice and accounting provisions enforced by the SEC.

These laws prohibit improper payments or offers of payments to foreign

governments and their officials and political parties by the U.S.

and other business entities for the purpose of obtaining or retaining

We have implemented policies, procedures, systems, and controls designed to identify and address potentially impermissible transactions

under such laws and regulations;

however, there can be no assurance that all of our employees, consultants and agents, including those

that may be based in or from countries where practices that violate U.S.

or other laws may be customary, will not take actions in violation

of our policies, for which we may be ultimately responsible.

In addition, we are subject to anti-money laundering

laws and regulations, including the Bank Secrecy Act, as amended by the USA PATRIOT Act of 2001, or the BSA.

Among other things, the BSA

requires money services businesses (such as money transmitters and providers of prepaid access) to develop and implement risk-based anti-money

laundering programs, report large cash transactions and suspicious activity, and maintain transaction records.

We are also subject to certain economic and trade

sanctions programs that are administered by the Department of Treasury’s Office of Foreign Assets Control, or OFAC, which prohibit

or restrict transactions to or from or dealings with specified countries, their governments, and in certain circumstances, their nationals,

and with individuals and entities that are specially-designated nationals of those countries, narcotics traffickers, and terrorists or

terrorist organizations.

Other group entities may be subject to additional foreign or local sanctions requirements in other relevant jurisdictions.

Similar anti-money laundering and counter terrorist

financing and proceeds of crime laws apply to movements of currency and payments through electronic transactions and to dealings with

persons specified in lists maintained by the country equivalents to OFAC lists in several other countries and require specific data retention

obligations to be observed by intermediaries in the payment process.

Our businesses in those jurisdictions are subject to those data retention

Failure to comply with any of these laws and regulations

or changes in this regulatory environment, including changing interpretations and the implementation of new or varying regulatory requirements

by the government, may result in significant financial penalties, reputational harm or change the manner in which we currently conduct

some aspects of our business, which could adversely affect our business, financial condition or results of operations.

Failure to enforce and defend our intellectual property rights

may diminish our competitive advantages or interfere with our ability to market and promote our products and services.

Our trademarks, trade names, trade secrets, know-how,

proprietary technology and other intellectual property are important to our future success.

We have a pending trademark application for

“CrowdPay.us Crowdfunding & Compliance Platform”.

We believe our trademarks and trade names are widely recognized and

associated with quality and reliable service.

While it is our policy to protect and defend vigorously our rights to our intellectual property,

we cannot predict whether steps taken by us to protect our intellectual property will be adequate to prevent infringement, misappropriation

or other violation of our rights.

We also cannot guarantee that others will not independently develop technology with the same or similar

functions to any proprietary technology we rely on to conduct our business and differentiate ourselves from our competitors.

we may face claims of infringement of third-party intellectual property that could interfere with our ability to market and promote our

Any litigation to enforce our intellectual property rights or defend ourselves against claims of infringement of third-party intellectual

property rights could be costly, divert attention of management and may not ultimately be resolved in our favor.

Moreover, if we are unable

to successfully defend against claims that we have infringed the intellectual property rights of others, we may be prevented from using

certain intellectual property and may be liable for damages, which in turn could materially adversely affect our business, financial condition

or results of operations.

In addition, the laws of certain non-U.S.

countries where we do business or may do business in the future may

not recognize intellectual property rights or protect them to the same extent as do the laws of the United States.

New or revised tax regulations or their

interpretations, or becoming subject to additional foreign or U.S.

federal, state or local taxes that cannot be passed through to our

merchants or partners, could reduce our net income.

We are subject to tax laws in each jurisdiction

where we do business.

Changes in tax laws or their interpretations could decrease the amount of revenues we receive, the value of any

tax loss carry-forwards and tax credits recorded on our balance sheet and the amount of our cash flow, and adversely affect our business,

financial condition or results of operations.

On December 22, 2017, President Trump signed into

1, originally known as “The Tax Cuts and Jobs Act,” which significantly revised the Internal Revenue Code of 1986,

state and local sales and use taxes if a state tax authority asserts that distribution

of our solutions over the internet is subject to sales and use taxes.

Each state has different rules and regulations governing sales

and use taxes, and these rules and regulations are subject to varying interpretations that change over time.

We review these rules and

regulations periodically and, when we believe we are subject to sales and use taxes in a particular state, voluntarily engage state tax

authorities in order to determine how to comply with their rules and regulations.

If a state tax authority asserts that distribution

of our solutions is subject to such sales and use taxes, the additional cost may decrease the likelihood that such merchants would purchase

our solutions or continue to renew their subscriptions.

successful assertion by one or more states requiring us to collect sales or other taxes on subscription service revenue could result

in substantial tax liabilities for past transactions and otherwise harm our business.

We cannot assure you that we will not be subject

to sales and use taxes or related penalties for past sales in states where we currently believe no such taxes are required.

New obligations

to collect or pay taxes of any kind could increase our cost of doing business.

are dependent upon consumers’ and merchants’ willingness to use the internet for commerce.

success depends upon the general public’s continued willingness to use the internet as a means to pay for purchases, communicate,

access social media, research and conduct commercial transactions, including through mobile devices.

If consumers or merchants become

unwilling or less willing to use the internet for commerce for any reason, including lack of access to high-speed communications equipment,

congestion of traffic on the internet, internet outages or delays, disruptions or other damage to merchants’ and consumers’

computers, increases in the cost of accessing the internet and security and privacy risks or the perception of such risks, our business

could be adversely affected.

may face challenges in expanding into new geographic regions.

future success will depend in part upon our ability to expand into new geographic regions, and we will face risks entering markets in

which we have limited or no experience and in which we do not have any brand recognition.

Expanding into new geographic regions where

the main language is not English will require substantial expenditures and take considerable time and attention, and we may not be successful

enough in these new markets to recoup our investments in a timely manner, or at all.

Our efforts to expand into new geographic regions

may not be successful, which could limit our ability to grow our business.

Related to Laws and Regulations

to comply with the U.S.

Foreign Corrupt Practices Act, or the FCPA, anti-money laundering, economic and trade sanctions regulations,

and similar laws could subject us to penalties and other adverse consequences.

currently operate our business only in the United States.

We are subject to anti-corruption laws and regulations, including the FCPA,

and other laws that prohibit the making or offering of improper payments to foreign government officials and political figures, including

anti-bribery provisions enforced by the Department of Justice and accounting provisions enforced by the SEC.

These laws prohibit improper

payments or offers of payments to foreign governments and their officials and political parties by the U.S.

and other business entities

for the purpose of obtaining or retaining business.

We have implemented policies, procedures, systems, and controls designed to identify

and address potentially impermissible transactions under such laws and regulations;

however, there can be no assurance that all of our

employees, consultants and agents, including those that may be based in or from countries where practices that violate U.S.

laws may be customary, will not take actions in violation of our policies, for which we may be ultimately responsible.

addition, we are subject to anti-money laundering laws and regulations, including the Bank Secrecy Act, as amended by the USA PATRIOT

Act of 2001, or the BSA.

Among other things, the BSA requires money services businesses (such as money transmitters and providers of

prepaid access) to develop and implement risk-based anti-money laundering programs, report large cash transactions and suspicious activity,

and maintain transaction records.

are also subject to certain economic and trade sanctions programs that are administered by the Department of Treasury’s Office

of Foreign Assets Control, or OFAC, which prohibit or restrict transactions to or from or dealings with specified countries, their governments,

and in certain circumstances, their nationals, and with individuals and entities that are specially-designated nationals of those countries,

narcotics traffickers, and terrorists or terrorist organizations.

Other group entities may be subject to additional foreign or local

sanctions requirements in other relevant jurisdictions.

anti-money laundering and counter terrorist financing and proceeds of crime laws apply to movements of currency and payments through

electronic transactions and to dealings with persons specified in lists maintained by the country equivalents to OFAC lists in several

other countries and require specific data retention obligations to be observed by intermediaries in the payment process.

Our businesses

in those jurisdictions are subject to those data retention obligations.

to comply with any of these laws and regulations or changes in this regulatory environment, including changing interpretations and the

implementation of new or varying regulatory requirements by the government, may result in significant financial penalties, reputational

harm or change the manner in which we currently conduct some aspects of our business, which could adversely affect our business, financial

condition or results of operations.

to enforce and defend our intellectual property rights may diminish our competitive advantages or interfere with our ability to market

and promote our products and services.

trademarks, trade names, trade secrets, know-how, proprietary technology and other intellectual property are important to our future

We have a pending trademark application for “CrowdPay.us Crowdfunding & Compliance Platform”.

We believe our

trademarks and trade names are widely recognized and associated with quality and reliable service.

While it is our policy to protect

and defend vigorously our rights to our intellectual property, we cannot predict whether steps taken by us to protect our intellectual

property will be adequate to prevent infringement, misappropriation or other violation of our rights.

We also cannot guarantee that others

will not independently develop technology with the same or similar functions to any proprietary technology we rely on to conduct our

business and differentiate ourselves from our competitors.

Furthermore, we may face claims of infringement of third-party intellectual

property that could interfere with our ability to market and promote our brands.

Any litigation to enforce our intellectual property

rights or defend ourselves against claims of infringement of third-party intellectual property rights could be costly, divert attention

of management and may not ultimately be resolved in our favor.

Moreover, if we are unable to successfully defend against claims that

we have infringed the intellectual property rights of others, we may be prevented from using certain intellectual property and may be

liable for damages, which in turn could materially adversely affect our business, financial condition or results of operations.

the laws of certain non-U.S.

countries where we do business or may do business in the future may not recognize intellectual property

rights or protect them to the same extent as do the laws of the United States.

or revised tax regulations or their interpretations, or becoming subject to additional foreign or U.S.

federal, state or local taxes

that cannot be passed through to our merchants or partners, could reduce our net income.

are subject to tax laws in each jurisdiction where we do business.

Changes in tax laws or their interpretations could decrease the amount

of revenues we receive, the value of any tax loss carry-forwards and tax credits recorded on our balance sheet and the amount of our

cash flow, and adversely affect our business, financial condition or results of operations.

December 22, 2017, President Trump signed into law H.R.

1, originally known as “The Tax Cuts and Jobs Act,” which significantly

revised the Internal Revenue Code of 1986, as amended.

The new legislation has significantly changed the U.S.

federal income taxation of U.S.

corporations, including by reducing

corporate income tax rate, limiting interest deductions, permitting immediate expensing of certain capital expenditures, adopting

elements of a territorial tax system, imposing a one-time transition tax, or repatriation tax, on all undistributed earnings and profits

of certain U.S.-owned foreign corporations, revising the rules governing net operating losses and the rules governing foreign tax credits,

and introducing new anti-base erosion provisions.

Many of these changes are effective immediately, without any transition periods or grandfathering

for existing transactions.

The legislation is unclear in many respects and could be subject to potential amendments and technical corrections,

as well as interpretations and implementing regulations by the Internal Revenue Service, or the IRS, any of which could lessen or increase

certain adverse impacts of the legislation.

In addition, it is unclear how these U.S.

federal income tax changes will affect state and

local taxation, which often uses federal taxable income as a starting point for computing state and local tax liabilities.

On March 27, 2020, Donald Trump signed into law

the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”), which, among other things, is intended to provide

emergency assistance to qualifying businesses and individuals.

There can be no assurance that these interventions by the government will

be successful, and the financial markets may experience significant contractions in available liquidity.

While the Company may receive

financial, tax or other relief and other benefits under and as a result of the CARES Act, it is not possible to estimate at this time

the availability, extent or impact of any such relief.

While some of the changes made by the tax legislation

may adversely affect us in one or more reporting periods and prospectively, other changes may be beneficial on a going forward basis.

We continue to work with our tax advisors to determine the full impact that the recent tax legislation as a whole will have on us.

Additionally, companies in the electronic payments

industry, including us, may become subject to incremental taxation in various tax jurisdictions.

Taxing jurisdictions have not yet adopted

uniform positions on this topic.

If we are required to pay additional taxes and are unable to pass the tax expense through to our merchants,

our costs would increase and our net income would be reduced.

Failure to comply with, or changes in, laws,

regulations and enforcement activities may adversely affect the products, services and markets in which we operate.

We and our merchants are subject to laws and regulations

that affect the electronic payments industry in the many countries in which our services are used.

In particular, our merchants are subject

to numerous laws and regulations applicable to banks, financial institutions, and card issuers in the United States and abroad, and, consequently,

we are at times affected by these foreign, federal, state, and local laws and regulations.

government has increased its scrutiny

of a number of credit card practices, from which some of our merchants derive significant revenue.

Regulation of the payments industry,

including regulations applicable to us and our merchants, has increased significantly in recent years.

Failure to comply with laws and

regulations applicable to our business may result in the suspension or revocation of licenses or registrations, the limitation, suspension

or termination of services or the imposition of consent orders or civil and criminal penalties, including fines which could adversely

federal income taxation

corporations, including by reducing the U.S.

corporate income tax rate, limiting interest deductions, permitting immediate expensing

of certain capital expenditures, adopting elements of a territorial tax system, imposing a one-time transition tax, or repatriation tax,

on all undistributed earnings and profits of certain U.S.-owned foreign corporations, revising the rules governing net operating losses

and the rules governing foreign tax credits, and introducing new anti-base erosion provisions.

Many of these changes are effective immediately,

without any transition periods or grandfathering for existing transactions.

The legislation is unclear in many respects and could be

subject to potential amendments and technical corrections, as well as interpretations and implementing regulations by the Internal Revenue

Service, or the IRS, any of which could lessen or increase certain adverse impacts of the legislation.

In addition, it is unclear how

federal income tax changes will affect state and local taxation, which often uses federal taxable income as a starting point

for computing state and local tax liabilities.

March 27, 2020, Donald Trump signed into law the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”), which,

among other things, is intended to provide emergency assistance to qualifying businesses and individuals.

There can be no assurance that

these interventions by the government will be successful, and the financial markets may experience significant contractions in available

While the Company may receive financial, tax or other relief and other benefits under and as a result of the CARES Act, it

is not possible to estimate at this time the availability, extent or impact of any such relief.

some of the changes made by the tax legislation may adversely affect us in one or more reporting periods and prospectively, other changes

may be beneficial on a going forward basis.

We continue to work with our tax advisors to determine the full impact that the recent tax

legislation as a whole will have on us.

Additionally,

companies in the electronic payments industry, including us, may become subject to incremental taxation in various tax jurisdictions.

Taxing jurisdictions have not yet adopted uniform positions on this topic.

If we are required to pay additional taxes and are unable

to pass the tax expense through to our merchants, our costs would increase and our net income would be reduced.

to comply with, or changes in, laws, regulations and enforcement activities may adversely affect the products, services and markets in

which we operate.

and our merchants are subject to laws and regulations that affect the electronic payments industry in the many countries in which our

services are used.

In particular, our merchants are subject to numerous laws and regulations applicable to banks, financial institutions,

and card issuers in the United States and abroad, and, consequently, we are at times affected by these foreign, federal, state, and local

laws and regulations.

government has increased its scrutiny of a number of credit card practices, from which some of our merchants

derive significant revenue.

Regulation of the payments industry, including regulations applicable to us and our merchants, has increased

significantly in recent years.

Failure to comply with laws and regulations applicable to our business may result in the suspension or

revocation of licenses or registrations, the limitation, suspension or termination of services or the imposition of consent orders or

civil and criminal penalties, including fines which could adversely affect our business, financial condition or results of operations.

are also subject to U.S.

financial services regulations, a myriad of consumer protection laws, including economic sanctions, laws and

regulations, anticorruption laws, escheat regulations and privacy and information security regulations.

Changes to legal rules and regulations,

or interpretation or enforcement of them, could have a negative financial effect on us.

Any lack of legal certainty exposes our operations

to increased risks, including increased difficulty in enforcing our agreements in those jurisdictions and increased risks of adverse

actions by local government authorities, such as expropriations.

In addition, certain of our alliance partners are subject to regulation

by federal and state authority and, as a result, could pass through some of those compliance obligations to us, which could adversely

affect our business, financial condition or results of operations.

We are also subject to U.S.

financial services

regulations, a myriad of consumer protection laws, including economic sanctions, laws and regulations, anticorruption laws, escheat regulations

and privacy and information security regulations.

Changes to legal rules and regulations, or interpretation or enforcement of them, could

have a negative financial effect on us.

Any lack of legal certainty exposes our operations to increased risks, including increased difficulty

in enforcing our agreements in those jurisdictions and increased risks of adverse actions by local government authorities, such as expropriations.

In addition, certain of our alliance partners are subject to regulation by federal and state authority and, as a result, could pass through

some of those compliance obligations to us, which could adversely affect our business, financial condition or results of operations.

In particular, the Dodd-Frank Wall Street Reform

and Consumer Protection Act of 2010 (the “Dodd-Frank Act”), recently significantly changed the U.S.

particular, the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the “Dodd-Frank Act”), recently significantly

changed the U.S.

financial regulatory system.

Among other things, Title X of the Dodd-Frank Act established a new, independent regulatory agency known as the Consumer Financial Protection

Bureau, or CFPB, to regulate consumer financial products and services (including some offered by our merchants).

The CFPB rules, examinations

and enforcement actions may require us to adjust our activities and may increase our compliance costs.

Separately, under the Dodd-Frank Act, debit interchange

transaction fees that a card issuer receives and are established by a payment card network for an electronic debit transaction are now

regulated by the Board of Governors of the Federal Reserve System, or the Federal Reserve, and must be “reasonable and proportional”

to the cost incurred by the card issuer in authorizing, clearing, and settling the transaction.

Effective October 1, 2011, the Federal

Reserve capped debit interchange rates for card issuers operating in the United States with assets of $10 billion or more at the sum of

$0.21 per transaction and an ad valorem component of 5 basis points to reflect a portion of the card issuer’s fraud losses

plus, for qualifying card issuers, an additional $0.01 per transaction in debit interchange for fraud prevention costs.

Regulations such

as these could result in the need for us to make capital investments to modify our services to facilitate our existing merchants’

and potential merchants’ compliance and reduce the fees we are able to charge our merchants.

These regulations also could result

in greater pricing transparency and increased price-based competition leading to lower margins and higher rates of merchant attrition.

Furthermore, the requirements of the regulations and the timing of their effective dates could result in changes in our merchants’

business practices, which could change the demand for our services and alter the type or volume of transactions that we process on behalf

of our merchants.

DMINT and OLBit

Cryptocurrency Risks

We have an evolving business model.

Cryptocurrencies and blockchain technologies are

relatively new and highly speculative.

Cryptocurrencies and blockchain technologies have limited history, and their risks cannot be fully

known at this time.

As cryptocurrency assets and blockchain technologies become more widely available, we expect the services and products

associated with them to evolve.

In order to stay current with the industry, our business model may need to evolve as well.

From time to time, we may modify aspects of our business model relating to our product mix and service offerings.

We cannot offer

any assurance that these or any other modifications will be successful or will not result in harm to our business.

We may not be

able to manage growth effectively, which could damage our reputation, limit our growth and negatively affect our operating results.

Such circumstances could have a material adverse effect on our ability to continue as a going concern or to pursue our new strategy at

all, which could have a material adverse effect on our business, prospects or operations.

We may not be able to compete with other

companies, some of which have greater resources and experience.

We may not be able to compete successfully against

present or future competitors.

We do not have the resources to compete with larger providers of similar services at this time.

The cryptocurrency industry has attracted various high-profile and well-established operators, some of which have substantially greater

liquidity and financial resources than we do.

With the limited resources we have available, we may experience great difficulties

in building our network of computers and creating an exchange.

Competition from existing and future competitors could result in

our inability to secure acquisitions and partnerships that we may need to expand our business.

This competition from other entities

with greater resources, experience and reputations may result in our failure to maintain or expand our business, as we may never be able

to successfully execute our business plan.

The properties included in our mining network

may experience damages.

Our initial cryptocurrency mining farm in Pennsylvania

is, and any future mining farms we establish will be, subject to a variety of risks relating to physical condition and operation, including:

Among other things, Title X of the Dodd-Frank Act established a new, independent regulatory

agency known as the Consumer Financial Protection Bureau, or CFPB, to regulate consumer financial products and services (including some

offered by our merchants).

The CFPB rules, examinations and enforcement actions may require us to adjust our activities and may increase

our compliance costs.

under the Dodd-Frank Act, debit interchange transaction fees that a card issuer receives and are established by a payment card network

for an electronic debit transaction are now regulated by the Board of Governors of the Federal Reserve System, or the Federal Reserve,

and must be “reasonable and proportional” to the cost incurred by the card issuer in authorizing, clearing, and settling

the transaction.

Effective October 1, 2011, the Federal Reserve capped debit interchange rates for card issuers operating in the United

States with assets of $10 billion or more at the sum of $0.21 per transaction and an ad valorem component of 5 basis points to

reflect a portion of the card issuer’s fraud losses plus, for qualifying card issuers, an additional $0.01 per transaction in debit

interchange for fraud prevention costs.

Regulations such as these could result in the need for us to make capital investments to modify

our services to facilitate our existing merchants’ and potential merchants’ compliance and reduce the fees we are able to

charge our merchants.

These regulations also could result in greater pricing transparency and increased price-based competition leading

to lower margins and higher rates of merchant attrition.

Furthermore, the requirements of the regulations and the timing of their effective

dates could result in changes in our merchants’ business practices, which could change the demand for our services and alter the

type or volume of transactions that we process on behalf of our merchants.

Cryptocurrency

have an evolving business model.

Cryptocurrencies

and blockchain technologies are relatively new and highly speculative.

Cryptocurrencies and blockchain technologies have limited history,

and their risks cannot be fully known at this time.

As cryptocurrency assets and blockchain technologies become more widely available,

we expect the services and products associated with them to evolve.

In order to stay current with the industry, our business model

may need to evolve as well.

From time to time, we may modify aspects of our business model relating to our product mix and service

We cannot offer any assurance that these or any other modifications will be successful or will not result in harm to

our business.

We may not be able to manage growth effectively, which could damage our reputation, limit our growth and negatively

affect our operating results.

Such circumstances could have a material adverse effect on our ability to continue as a going concern

or to pursue our new strategy at all, which could have a material adverse effect on our business, prospects or operations.

may not be able to compete with other companies, some of which have greater resources and experience.

may not be able to compete successfully against present or future competitors.

We do not have the resources to compete with larger

providers of similar services at this time.

The cryptocurrency industry has attracted various high-profile and well-established

operators, some of which have substantially greater liquidity and financial resources than we do.

With the limited resources we

have available, we may experience great difficulties in building our network of computers and creating an exchange.

from existing and future competitors could result in our inability to secure acquisitions and partnerships that we may need to expand

our business.

This competition from other entities with greater resources, experience and reputations may result in our failure

to maintain or expand our business, as we may never be able to successfully execute our business plan.

properties included in our mining network may experience damages.

cryptocurrency mining operation in Tennessee is, and any future mining farms we establish will be, subject to a variety of risks relating

to physical condition and operation, including:

presence of construction or repair defects or other structural or building damage;

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by employees and others for injuries sustained at our properties.

For example, a mine could be rendered inoperable,

temporarily or permanently, as a result of a fire or other natural disaster or by a terrorist or other attack on the mine.

and other measures we take to protect against these risks may not be sufficient.

Additionally, our mines could be materially adversely

affected by a power outage or loss of access to the electrical grid or loss by the grid of cost-effective sources of electrical power

generating capacity.

Given the power requirement, it would not be feasible to run miners on back-up power generators in the event

of a power outage or damage to our primary generators.

Cryptocurrency exchanges and other trading

venues are relatively new and, in most cases, largely unregulated and may therefore be the subject of fraud and failures.

When cryptocurrency exchanges or other trading

venues are involved in fraud or experience security failures or other operational issues, such events could result in a reduction in cryptocurrency

prices or confidence and impact our success and have a material adverse effect on our ability to continue as a going concern or to pursue

this segment at all, which would have a material adverse effect on our business, prospects and operations.

Cryptocurrency market prices depend, directly

or indirectly, on the prices set on exchanges and other trading venues, which are new and, in most cases, largely unregulated as compared

to established, regulated exchanges for securities, commodities or currencies.

For example, during the past several years, a number of

Bitcoin exchanges have closed due to fraud, business failure or security breaches.

In many of these instances, the customers of the closed

exchanges were not compensated or made whole for partial or complete losses of their account balances.

While smaller exchanges are less

likely to have the infrastructure and capitalization that may provide larger exchanges with some stability, larger exchanges may be more

likely to be appealing targets for hackers and “malware” (i.e., software used or programmed by attackers to disrupt computer

operation, gather sensitive information or gain access to private computer systems) and may be more likely to be targets of regulatory

enforcement action.

We do not maintain any insurance to protect from such risks, and do not expect any insurance for customer accounts

to be available (such as federal deposit insurance) at any time in the future, putting customer accounts at risk if any such events occur.

In the event we experience fraud, security failures, operational issues or similar events such factors would have a material adverse effect

on our ability to continue as a going concern or to pursue this segment at all, which would have a material adverse effect on our business,

example, a mine could be rendered inoperable, temporarily or permanently, as a result of a fire or other natural disaster or by a terrorist

or other attack on the mine.

The security and other measures we take to protect against these risks may not be sufficient.

Additionally, our mines could be materially adversely affected by a power outage or loss of access to the electrical grid or loss by

the grid of cost-effective sources of electrical power generating capacity.

Given the power requirement, it would not be feasible

to run miners on back-up power generators in the event of a power outage or damage to our primary generators.

Cryptocurrency

exchanges and other trading venues are relatively new and, in most cases, largely unregulated and may therefore be the subject of fraud

and failures.

cryptocurrency exchanges or other trading venues are involved in fraud or experience security failures or other operational issues, such

events could result in a reduction in cryptocurrency prices or confidence and impact our success and have a material adverse effect on

our ability to continue as a going concern or to pursue this segment at all, which would have a material adverse effect on our business,

prospects and operations.

Regulatory changes or actions may alter

the nature of an investment in us or restrict the use of cryptocurrencies in a manner that adversely affects our business, prospects or

As cryptocurrencies have grown in both popularity

and market size, governments around the world have reacted differently to cryptocurrencies, with certain governments deeming them illegal

while others have allowed their use and trade.

Governments may in the future curtail or outlaw

the mining, acquisition, use, trading or redemption of cryptocurrencies.

Ownership of, holding or trading in cryptocurrencies may then

be considered illegal and subject to sanction.

Governments may also take regulatory action that may increase the cost and/or subject cryptocurrency

companies to additional regulation.

The effect of any future regulatory change on our business or any cryptocurrency that may impact our

business is impossible to predict, but such change could be substantial and may have a material adverse effect on our business, prospects

and operations.

The development and acceptance of cryptographic

and algorithmic protocols governing the issuance of and transactions in cryptocurrencies is subject to a variety of factors that are difficult

The use of cryptocurrencies to, among other things,

buy and sell goods and services and complete transactions, is part of a new and rapidly evolving industry that employs digital assets

based upon a computer-generated mathematical and/or cryptographic protocol.

Cryptocurrencies are not recognized as legal tender by any

or foreign governmental authority, and they are not backed by the full faith and credit of, or endorsed by, any government.

of cryptocurrency in respect of any specific transaction is based on the agreement of the parties thereto, and the value of such cryptocurrency

more broadly is based on the agreement of market participants.

Currently, a significant portion of cryptocurrency demand is generated

by speculators seeking to profit from short- or long-term price fluctuations.

It is doubtful that any given cryptocurrency has any intrinsic

The growth of this industry in general, and the

use of cryptocurrencies in particular, is subject to a high degree of uncertainty, and the slowing or stopping of the development or acceptance

of developing protocols may occur and is unpredictable.

The factors include, but are not limited to:

Cryptocurrency

market prices depend, directly or indirectly, on the prices set on exchanges and other trading venues, which are new and, in most cases,

largely unregulated as compared to established, regulated exchanges for securities, commodities or currencies.

For example, during the

past several years, a number of Bitcoin exchanges have closed due to fraud, business failure or security breaches.

In many of these instances,

the customers of the closed exchanges were not compensated or made whole for partial or complete losses of their account balances.

smaller exchanges are less likely to have the infrastructure and capitalization that may provide larger exchanges with some stability,

larger exchanges may be more likely to be appealing targets for hackers and “malware” (i.e., software used or programmed

by attackers to disrupt computer operation, gather sensitive information or gain access to private computer systems) and may be more

likely to be targets of regulatory enforcement action.

We do not maintain any insurance to protect from such risks, and do not expect

any insurance for customer accounts to be available (such as federal deposit insurance) at any time in the future, putting customer accounts

at risk if any such events occur.

In the event we experience fraud, security failures, operational issues or similar events such factors

would have a material adverse effect on our ability to continue as a going concern or to pursue this segment at all, which would have

a material adverse effect on our business, prospects and operations.

changes or actions may alter the nature of an investment in us or restrict the use of cryptocurrencies in a manner that adversely affects

our business, prospects or operations.

cryptocurrencies have grown in both popularity and market size, governments around the world have reacted differently to cryptocurrencies,

with certain governments deeming them illegal while others have allowed their use and trade.

may in the future curtail or outlaw the mining, acquisition, use, trading or redemption of cryptocurrencies.

Ownership of, holding or

trading in cryptocurrencies may then be considered illegal and subject to sanction.

Governments may also take regulatory action that

may increase the cost and/or subject cryptocurrency companies to additional regulation.

The effect of any future regulatory change on

our business or any cryptocurrency that may impact our business is impossible to predict, but such change could be substantial and may

have a material adverse effect on our business, prospects and operations.

development and acceptance of cryptographic and algorithmic protocols governing the issuance of and transactions in cryptocurrencies

is subject to a variety of factors that are difficult to evaluate.

use of cryptocurrencies to, among other things, buy and sell goods and services and complete transactions, is part of a new and rapidly

evolving industry that employs digital assets based upon a computer-generated mathematical and/or cryptographic protocol.

Cryptocurrencies

are not recognized as legal tender by any U.S.

or foreign governmental authority, and they are not backed by the full faith and credit

of, or endorsed by, any government.

The value of cryptocurrency in respect of any specific transaction is based on the agreement of the

parties thereto, and the value of such cryptocurrency more broadly is based on the agreement of market participants.

Currently, a significant

portion of cryptocurrency demand is generated by speculators seeking to profit from short- or long-term price fluctuations.

It is doubtful

that any given cryptocurrency has any intrinsic value.

growth of this industry in general, and the use of cryptocurrencies in particular, is subject to a high degree of uncertainty, and the

slowing or stopping of the development or acceptance of developing protocols may occur and is unpredictable.

The factors include, but

are not limited to:

worldwide growth in the adoption and use of cryptocurrencies;

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consumer sentiment and perception of bitcoin specifically and cryptocurrencies generally.

If any of those events occur, it may have a material

adverse effect on our ability to pursue this business segment, which would have a material adverse effect on our business, prospects or

operations and potentially the value of any cryptocurrencies we hold or expect to acquire for our own account and harm investors in our

Banks and financial institutions may not

provide banking services, or may cut off services, to businesses that provide cryptocurrency-related services or that accept cryptocurrencies

as payment, including financial institutions of investors in our securities.

A number of companies that provide bitcoin and/or

other cryptocurrency-related services have been unable to find banks or financial institutions that are willing to provide them with bank

accounts and other services.

Similarly, a number of companies and individuals or businesses associated with cryptocurrencies have had

and may continue to have their existing bank accounts closed or services discontinued with financial institutions.

We also may be unable

to obtain or maintain these services for our business.

The difficulty that many businesses that provide bitcoin and/or other cryptocurrency-related

services have and may continue to have in finding banks and financial institutions willing to provide them services may be decreasing

the usefulness of cryptocurrencies as a payment system and harming public perception of cryptocurrencies and could decrease its usefulness

and harm its public perception in the future.

Similarly, the usefulness of cryptocurrencies as a payment system and the public perception

of cryptocurrencies could be damaged if banks or financial institutions were to close the accounts of businesses providing bitcoin and/or

other cryptocurrency-related services.

This could occur as a result of compliance risk, cost, government regulation or public pressure.

The risk applies to securities firms, clearance and settlement firms, national stock and commodities exchanges, the over the counter market

and the Depository Trust Company, which, if any of such entities adopts or implements similar policies, rules or regulations, could result

in the inability of our investors to open or maintain stock or commodities accounts, including the ability to deposit, maintain or trade

our securities.

Such factors would have a material adverse effect on our ability to continue as a going concern or to pursue this segment

at all, which would have a material adverse effect on our business, prospects or operations and harm investors.

The impact of geopolitical events on the

supply and demand for cryptocurrencies is uncertain.

Crises may motivate large-scale purchases of cryptocurrencies

which could increase the price of cryptocurrencies rapidly.

This may increase the likelihood of a subsequent price decrease as crisis-driven

purchasing behavior wanes, adversely affecting the value of any cryptocurrencies we hold or expect to acquire for our own account.

risks are similar to the risks of purchasing commodities in general uncertain times, such as the risk of purchasing, holding or selling

As an alternative to gold or fiat currencies that

are backed by central governments, cryptocurrencies, which are relatively new, are subject to supply and demand forces.

How such supply

and demand will be impacted by geopolitical events is uncertain but could be harmful to us and investors in our securities.

Nevertheless,

political or economic crises may motivate large-scale acquisitions or sales of cryptocurrencies either globally or locally.

would have a material adverse effect on our ability to continue as a going concern or to pursue this segment at all, which would have

a material adverse effect on our business, prospects or operations and potentially the value of any cryptocurrencies we hold or expect

to acquire for our own account.

Acceptance and/or widespread use of cryptocurrency

is uncertain.

Currently, there is a relatively small use of

bitcoins and/or other cryptocurrencies in the retail and commercial marketplace for goods or services.

In comparison there is relatively

large use by speculators, which contributes to price volatility.

The relative lack of acceptance of cryptocurrencies

in the retail and commercial marketplace limits the ability of end-users to use them to pay for goods and services.

Such lack of acceptance

or decline in acceptances would have a material adverse effect on our ability to pursue this business segment at all, which would have

a material adverse effect on our business, prospects or operations and potentially the value of any cryptocurrencies we hold or expect

to acquire for our own account.

Transactional fees may decrease demand for bitcoin and prevent

As the number of Bitcoin awarded for solving a

block in a blockchain decreases, the incentive for miners to continue to contribute to the bitcoin network will transition from a set

reward to transaction fees.

Either the requirement from miners of higher transaction fees in exchange for recording transactions

in a blockchain or a software upgrade that automatically charges fees for all transactions may decrease demand for bitcoin and prevent

the expansion of the bitcoin network to retail merchants and commercial businesses, resulting in a reduction in the price of bitcoin that

could adversely impact an investment in our securities.

In order to incentivize miners to continue to

contribute to the Bitcoin network, the Bitcoin network may either formally or informally transition from a set reward to transaction fees

earned upon solving a block.

This transition could be accomplished by miners independently electing to record in the blocks they

solve only those transactions that include payment of a transaction fee.

If transaction fees paid for bitcoin transactions become

too high, the marketplace may be reluctant to accept bitcoin as a means of payment and existing users may be motivated to switch from

bitcoin to another cryptocurrency or to fiat currency.

Decreased use and demand for Bitcoin may adversely affect its value and result

in a reduction in the price of bitcoin and the value of our securities.

Cryptocurrency inventory, including that

maintained by or for us, may be exposed to cybersecurity threats and hacks.

As with any computer code generally, flaws in

cryptocurrency codes may be exposed by malicious actors.

Cryptocurrencies are held in software wallets, which may be subject to

cyberattacks.

Several errors and defects have been found previously, including those that disabled some functionality for users

and exposed users’ information.

Exploitations of flaws in the source code that allow malicious actors to take or create money

have previously occurred.

If a malicious actor or botnet (a volunteer or hacked collection of computers controlled by networked

software coordinating the actions of the computers) obtains control of more than 50% of the processing power on a distributed ledger network,

such actor or botnet could manipulate the network to adversely affect the associated cryptocurrency and its users.

If a malicious actor

or botnet obtains a majority of the processing power dedicated to mining a cryptocurrency, it may be able to alter the distributed ledger

network on which transactions of cryptocurrency reside and rely by constructing fraudulent blocks or preventing certain transactions from

completing in a timely manner, or at all.

Despite our efforts and processes to prevent breaches,

our devices, as well as our servers, computer systems and those of third parties that we use in our operations, are vulnerable to cyber

security risks, including cyber-attacks such as viruses and worms, phishing attacks, denial-of-service attacks, physical or electronic

break-ins, employee theft or misuse, and similar disruptions from unauthorized tampering with our servers and computer systems or those

of third parties that we use in our operations.

Such events could have a material adverse effect on our ability to continue as a

going concern or to pursue our new strategy at all, which could have a material adverse effect on our business, prospects or operations

and potentially the value of any bitcoin or other cryptocurrencies we mine or otherwise acquire or hold for our own account.

It may be illegal now, or in the future,

to acquire, own, hold, sell or use Bitcoin or other cryptocurrencies, participate in the blockchain or utilize similar digital assets

in one or more countries, the ruling of which would adversely affect us.

Although currently Bitcoin and other cryptocurrencies,

the blockchain and digital assets generally are not regulated or are lightly regulated in most countries, including the United States,

one or more countries such as China and Russia may take regulatory actions in the future that could severely restrict the right to acquire,

own, hold, sell or use these digital assets or to exchange for fiat currency.

Such restrictions may adversely affect us.

Such circumstances

would have a material adverse effect on our ability to continue as a going concern or to pursue this segment at all, which would have

a material adverse effect on our business, prospects or operations and potentially the value of any cryptocurrencies we hold or expect

to acquire for our own account and harm investors.

If regulatory changes or interpretations

require the regulation of bitcoins or other digital assets under the securities laws of the United States or elsewhere, including the

Securities Act, the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and the Investment Company Act of 1940,

as amended, or similar laws of other jurisdictions and interpretations by the SEC, the Commodity Futures Trading Commission (“CFTC”),

the Internal Revenue Service (“IRS”), Department of Treasury or other agencies or authorities, we may be required to register

and comply with such regulations, including at a state or local level.

To the extent that we decide to continue operations, the required

registrations and regulatory compliance steps may result in extraordinary expense or burdens to us.

We may also decide to cease certain

Any disruption of our operations in response to the changed regulatory circumstances may be at a time that is disadvantageous

Current and future legislation and SEC and CFTC

rulemaking and other regulatory developments, including interpretations released by a regulatory authority, may impact the manner in which

bitcoin or other cryptocurrencies are viewed or treated for classification and clearing purposes.

In particular, bitcoin and other cryptocurrencies

may not be excluded from the definition of “security” by SEC rulemaking or interpretation requiring registration of all transactions,

unless another exemption is available, including transacting in bitcoin or cryptocurrency amongst owners and require registration of trading

platforms as “exchanges”.

We cannot be certain as to how future regulatory developments will impact the treatment of bitcoin

and other cryptocurrencies under the law.

If we determine not to comply with such additional regulatory and registration requirements,

we may seek to cease certain of our operations in this business segment or be subjected to fines, penalties and other governmental action.

any of those events occur, it may have a material adverse effect on our ability to pursue this business segment, which would have a material

adverse effect on our business, prospects or operations and potentially the value of any cryptocurrencies we hold or expect to acquire

for our own account and harm investors in our securities.

and financial institutions may not provide banking services, or may cut off services, to businesses that provide cryptocurrency-related

services or that accept cryptocurrencies as payment, including financial institutions of investors in our securities.

number of companies that provide bitcoin and/or other cryptocurrency-related services have been unable to find banks or financial institutions

that are willing to provide them with bank accounts and other services.

Similarly, a number of companies and individuals or businesses

associated with cryptocurrencies have had and may continue to have their existing bank accounts closed or services discontinued with

financial institutions.

We also may be unable to obtain or maintain these services for our business.

The difficulty that many businesses

that provide bitcoin and/or other cryptocurrency-related services have and may continue to have in finding banks and financial institutions

willing to provide them services may be decreasing the usefulness of cryptocurrencies as a payment system and harming public perception

of cryptocurrencies and could decrease its usefulness and harm its public perception in the future.

Similarly, the usefulness of cryptocurrencies

as a payment system and the public perception of cryptocurrencies could be damaged if banks or financial institutions were to close the

accounts of businesses providing bitcoin and/or other cryptocurrency-related services.

This could occur as a result of compliance risk,

cost, government regulation or public pressure.

The risk applies to securities firms, clearance and settlement firms, national stock

and commodities exchanges, the over the counter market and the Depository Trust Company, which, if any of such entities adopts or implements

similar policies, rules or regulations, could result in the inability of our investors to open or maintain stock or commodities accounts,

including the ability to deposit, maintain or trade our securities.

Such factors would have a material adverse effect on our ability

to continue as a going concern or to pursue this segment at all, which would have a material adverse effect on our business, prospects

or operations and harm investors.

impact of geopolitical events on the supply and demand for cryptocurrencies is uncertain.

may motivate large-scale purchases of cryptocurrencies which could increase the price of cryptocurrencies rapidly.

This may increase

the likelihood of a subsequent price decrease as crisis-driven purchasing behavior wanes, adversely affecting the value of any cryptocurrencies

we hold or expect to acquire for our own account.

Such risks are similar to the risks of purchasing commodities in general uncertain

times, such as the risk of purchasing, holding or selling gold.

an alternative to gold or fiat currencies that are backed by central governments, cryptocurrencies, which are relatively new, are subject

to supply and demand forces.

How such supply and demand will be impacted by geopolitical events is uncertain but could be harmful to

us and investors in our securities.

Nevertheless, political or economic crises may motivate large-scale acquisitions or sales of cryptocurrencies

either globally or locally.

Such events would have a material adverse effect on our ability to continue as a going concern or to pursue

this segment at all, which would have a material adverse effect on our business, prospects or operations and potentially the value of

any cryptocurrencies we hold or expect to acquire for our own account.

and/or widespread use of cryptocurrency is uncertain.

there is a relatively small use of bitcoins and/or other cryptocurrencies in the retail and commercial marketplace for goods or services.

In comparison there is relatively large use by speculators, which contributes to price volatility.

relative lack of acceptance of cryptocurrencies in the retail and commercial marketplace limits the ability of end-users to use them

to pay for goods and services.

Such lack of acceptance or decline in acceptances would have a material adverse effect on our ability

to pursue this business segment at all, which would have a material adverse effect on our business, prospects or operations and potentially

the value of any cryptocurrencies we hold or expect to acquire for our own account.

Transactional

fees may decrease demand for Bitcoin and prevent expansion.

the number of Bitcoin awarded for solving a block in a blockchain decreases, the incentive for miners to continue to contribute to the

bitcoin network will transition from a set reward to transaction fees.

Either the requirement from miners of higher transaction

fees in exchange for recording transactions in a blockchain or a software upgrade that automatically charges fees for all transactions

may decrease demand for bitcoin and prevent the expansion of the bitcoin network to retail merchants and commercial businesses, resulting

in a reduction in the price of bitcoin that could adversely impact an investment in our securities.

order to incentivize miners to continue to contribute to the Bitcoin network, the Bitcoin network may either formally or informally transition

from a set reward to transaction fees earned upon solving a block.

This transition could be accomplished by miners independently

electing to record in the blocks they solve only those transactions that include payment of a transaction fee.

If transaction fees

paid for bitcoin transactions become too high, the marketplace may be reluctant to accept bitcoin as a means of payment and existing

users may be motivated to switch from bitcoin to another cryptocurrency or to fiat currency.

Decreased use and demand for Bitcoin

may adversely affect its value and result in a reduction in the price of bitcoin and the value of our securities.

Cryptocurrency

inventory, including that maintained by or for us, may be exposed to cybersecurity threats and hacks.

with any computer code generally, flaws in cryptocurrency codes may be exposed by malicious actors.

Cryptocurrencies are held in

software wallets, which may be subject to cyberattacks.

Several errors and defects have been found previously, including those

that disabled some functionality for users and exposed users’ information.

Exploitations of flaws in the source code that

allow malicious actors to take or create money have previously occurred.

If a malicious actor or botnet (a volunteer or hacked

collection of computers controlled by networked software coordinating the actions of the computers) obtains control of more than 50%

of the processing power on a distributed ledger network, such actor or botnet could manipulate the network to adversely affect the associated

cryptocurrency and its users.

If a malicious actor or botnet obtains a majority of the processing power dedicated to mining a cryptocurrency,

it may be able to alter the distributed ledger network on which transactions of cryptocurrency reside and rely by constructing fraudulent

blocks or preventing certain transactions from completing in a timely manner, or at all.

our efforts and processes to prevent breaches, our devices, as well as our servers, computer systems and those of third parties that

we use in our operations, are vulnerable to cyber security risks, including cyber-attacks such as viruses and worms, phishing attacks,

denial-of-service attacks, physical or electronic break-ins, employee theft or misuse, and similar disruptions from unauthorized tampering

with our servers and computer systems or those of third parties that we use in our operations.

Such events could have a material

adverse effect on our ability to continue as a going concern or to pursue our new strategy at all, which could have a material adverse

effect on our business, prospects or operations and potentially the value of any bitcoin or other cryptocurrencies we mine or otherwise

acquire or hold for our own account.

may be illegal now, or in the future, to acquire, own, hold, sell or use Bitcoin or other cryptocurrencies, participate in the blockchain

or utilize similar digital assets in one or more countries, the ruling of which would adversely affect us.

currently Bitcoin and other cryptocurrencies, the blockchain and digital assets generally are not regulated or are lightly regulated

in most countries, including the United States, one or more countries such as China and Russia may take regulatory actions in the future

that could severely restrict the right to acquire, own, hold, sell or use these digital assets or to exchange for fiat currency.

restrictions may adversely affect us.

Such circumstances would have a material adverse effect on our ability to continue as a going concern

or to pursue this segment at all, which would have a material adverse effect on our business, prospects or operations and potentially

the value of any cryptocurrencies we hold or expect to acquire for our own account and harm investors.

regulatory changes or interpretations require the regulation of bitcoins or other digital assets under the securities laws of the United

States or elsewhere, including the Securities Act, the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and

the Investment Company Act of 1940, as amended, or similar laws of other jurisdictions and interpretations by the SEC, the Commodity

Futures Trading Commission (“CFTC”), the Internal Revenue Service (“IRS”), Department of Treasury or other agencies

or authorities, we may be required to register and comply with such regulations, including at a state or local level.

To the extent that

we decide to continue operations, the required registrations and regulatory compliance steps may result in extraordinary expense or burdens

We may also decide to cease certain operations.

Any disruption of our operations in response to the changed regulatory circumstances

may be at a time that is disadvantageous to us.

and future legislation and SEC and CFTC rulemaking and other regulatory developments, including interpretations released by a regulatory

authority, may impact the manner in which bitcoin or other cryptocurrencies are viewed or treated for classification and clearing purposes.

In particular, bitcoin and other cryptocurrencies may not be excluded from the definition of “security” by SEC rulemaking

or interpretation requiring registration of all transactions, unless another exemption is available, including transacting in bitcoin

or cryptocurrency amongst owners and require registration of trading platforms as “exchanges”.

We cannot be certain as to

how future regulatory developments will impact the treatment of bitcoin and other cryptocurrencies under the law.

If we determine not

to comply with such additional regulatory and registration requirements, we may seek to cease certain of our operations in this business

segment or be subjected to fines, penalties and other governmental action.

Any such action may adversely affect an investment in us.

Such circumstances would have a material adverse effect on our ability to continue

as a going concern or to pursue this segment at all, which would have a material adverse effect on our business, prospects or operations

and potentially the value of any cryptocurrencies we hold or expect to acquire for our own account and harm investors.

Lack of liquid markets, and possible manipulation

of blockchain/cryptocurrency-based assets may adversely affect us.

Digital assets that are represented and trade

on a ledger-based platform may not necessarily benefit from viable trading markets.

Stock exchanges have listing requirements and vet

issuers, requiring them to be subjected to rigorous listing standards and rules and monitoring investors transacting on such platform

for fraud and other improprieties.

These conditions may not necessarily be replicated on a distributed ledger platform, depending on the

platform’s controls and other policies.

The more lax a distributed ledger platform is about vetting issuers of digital assets or

users that transact on the platform, the higher the potential risk for fraud or the manipulation of digital assets.

These factors may

decrease liquidity or volume, or increase volatility of digital securities or other assets trading on a ledger-based system.

Such circumstances

may have a material adverse effect on our ability to continue as a going concern or to pursue this segment at all, which would have a

material adverse effect on our business, prospects or operations and potentially the value of any cryptocurrencies we hold or expect to

acquire for our own account and harm investors.

If federal or state legislatures or agencies

initiate or release tax determinations that change the classification of bitcoins as property for tax purposes (in the context of when

such bitcoins are held as an investment), such determination could have a negative tax consequence on our Company or our shareholders.

Current IRS guidance indicates that digital assets

such as Bitcoin should be treated and taxed as property, and that transactions involving the payment of Bitcoin for goods and services

should be treated as barter transactions.

While such treatment would create a potential tax reporting requirement for any circumstance

where the ownership of bitcoin passes from one person to another, usually by means of bitcoin transactions (including off-blockchain transactions),

it preserves the right to apply capital gains treatment to those transactions.

Any change to such tax treatment may adversely affect an

investment in our Company.

Our dependence on third-party software and

personnel may leave us vulnerable to price fluctuations and rapidly changing technology.

Competitive conditions within the cryptocurrency

industry require that we use sophisticated technology in the operation of our future cryptocurrency mining business segment.

plan to utilize third-party software applications in our mining operations.

Further, we that some of our operations may be conducted

through collaboration with software providers.

The industry for blockchain technology is characterized by rapid technological changes,

new product introductions, enhancements and evolving industry standards.

New technologies, techniques or products could emerge that

might offer better performance than the software and other technologies we plan to utilize, and we may have to manage transitions to these

new technologies to remain competitive.

We may not be successful, generally or relative to our competitors in the cryptocurrency

industry, in timely implementing new technology into our systems, or doing so in a cost-effective manner.

During the course of implementing

any such new technology into our operations, we may experience the system interruptions and failures discussed above.

there can be no assurances that we will recognize, in a timely manner or at all, the benefits that we may expect as a result of our implementing

new technology into our operations.

Risks Related to Our Capital Stock

There is a very limited existing market

for our common stock and we do not know if a more liquid market for our common stock will develop to provide you with adequate liquidity.

There has been a very limited public market for

our common stock.

We cannot assure you that an active trading market for our common stock will develop, or if it does develop, that will

be maintained.

You may not be able to sell your securities quickly or at the market price if trading in our securities is not active.

Such circumstances would have a material adverse effect on our ability to continue as a going concern or to pursue this segment at all,

which would have a material adverse effect on our business, prospects or operations and potentially the value of any cryptocurrencies

we hold or expect to acquire for our own account and harm investors.

of liquid markets, and possible manipulation of blockchain/cryptocurrency-based assets may adversely affect us.

assets that are represented and trade on a ledger-based platform may not necessarily benefit from viable trading markets.

Stock exchanges

have listing requirements and vet issuers, requiring them to be subjected to rigorous listing standards and rules and monitoring investors

transacting on such platform for fraud and other improprieties.

These conditions may not necessarily be replicated on a distributed ledger

platform, depending on the platform’s controls and other policies.

The more lax a distributed ledger platform is about vetting

issuers of digital assets or users that transact on the platform, the higher the potential risk for fraud or the manipulation of digital

These factors may decrease liquidity or volume, or increase volatility of digital securities or other assets trading on a ledger-based

Such circumstances may have a material adverse effect on our ability to continue as a going concern or to pursue this segment

at all, which would have a material adverse effect on our business, prospects or operations and potentially the value of any cryptocurrencies

we hold or expect to acquire for our own account and harm investors.

federal or state legislatures or agencies initiate or release tax determinations that change the classification of bitcoins as property

for tax purposes (in the context of when such bitcoins are held as an investment), such determination could have a negative tax consequence

on our Company or our shareholders.

IRS guidance indicates that digital assets such as Bitcoin should be treated and taxed as property, and that transactions involving the

payment of Bitcoin for goods and services should be treated as barter transactions.

While such treatment would create a potential tax

reporting requirement for any circumstance where the ownership of bitcoin passes from one person to another, usually by means of bitcoin

transactions (including off-blockchain transactions), it preserves the right to apply capital gains treatment to those transactions.

Any change to such tax treatment may adversely affect an investment in our Company.

dependence on third-party software and personnel may leave us vulnerable to price fluctuations and rapidly changing technology.

conditions within the cryptocurrency industry require that we use sophisticated technology in the operation of our future cryptocurrency

mining business segment.

We plan to utilize third-party software applications in our mining operations.

Further, we that

some of our operations may be conducted through collaboration with software providers.

The industry for blockchain technology is

characterized by rapid technological changes, new product introductions, enhancements and evolving industry standards.

New technologies,

techniques or products could emerge that might offer better performance than the software and other technologies we plan to utilize,

and we may have to manage transitions to these new technologies to remain competitive.

We may not be successful, generally or relative

to our competitors in the cryptocurrency industry, in timely implementing new technology into our systems, or doing so in a cost-effective

During the course of implementing any such new technology into our operations, we may experience the system interruptions

and failures discussed above.

Furthermore, there can be no assurances that we will recognize, in a timely manner or at all, the

benefits that we may expect as a result of our implementing new technology into our operations.

Related to Our Capital Stock

is a very limited existing market for our common stock and we do not know if a more liquid market for our common stock will develop to

provide you with adequate liquidity.

has been a very limited public market for our common stock.

We cannot assure you that an active trading market for our common stock will

develop, or if it does develop, that will be maintained.

You may not be able to sell your securities quickly or at the market price if

trading in our securities is not active.

In the absence of a public trading market:

you may not be able to liquidate your investment in our securities;

you may not be able to resell your securities at or above the public offering price;

the market price of our common stock may experience more price volatility;

there may be less efficiency in carrying out your purchase and sale orders.

The market price of our common stock may

be highly volatile, and you could lose all or part of your investment.

The trading price of our common stock is likely

to be volatile.

This volatility may prevent you from being able to sell your shares at or above the price you paid for your shares.

stock price could be subject to wide fluctuations in response to a variety of factors, which include:

whether we achieve our anticipated corporate objectives;

actual or anticipated fluctuations in our quarterly or annual operating results;

changes in financial or operational estimates or projections;

termination of the lock-up agreement or other restrictions on the ability of our stockholders and other security holders to sell shares;

changes in the economic performance or market valuations of companies similar to ours;

general economic or political conditions in the United States or elsewhere.

In addition, the stock market in general, and

the stock of companies that are competitive to us in particular, have experienced extreme price and volume fluctuations that have often

been unrelated or disproportionate to the operating performance of these companies.

Broad market and industry factors may negatively affect

the market price of our common stock, regardless of our actual operating performance.

If our shares become subject to the penny

stock rules, it would become more difficult to trade our shares.

The SEC has adopted rules that regulate broker-dealer practices

in connection with transactions in penny stocks.

Penny stocks are generally equity securities with a price of less than $5.00, other than

securities registered on certain national securities exchanges or authorized for quotation on certain automated quotation systems, provided

that current price and volume information with respect to transactions in such securities is provided by the exchange or system.

do not retain a listing on a national securities exchange and if the price of our common stock is less than $5.00, our common stock will

be deemed a penny stock.

The penny stock rules require a broker-dealer, before a transaction in a penny stock not otherwise exempt from

those rules, to deliver a standardized risk disclosure document containing specified information.

In addition, the penny stock rules require

that before effecting any transaction in a penny stock not otherwise exempt from those rules, a broker-dealer must make a special

written determination that the penny stock is a suitable investment for the purchaser and receive (i) the purchaser’s written acknowledgment

of the receipt of a risk disclosure statement;

(ii) a written agreement to transactions involving penny stocks;

and (iii) a signed and

dated copy of a written suitability statement.

These disclosure requirements may have the effect of reducing the trading activity in the

secondary market for our common stock, and therefore stockholders may have difficulty selling their shares.

As a “thinly-traded” stock,

large sales can place downward pressure on our stock price.

Our stock experiences periods when it could be

considered “thinly traded”.

Financing transactions resulting in a large number of newly issued shares that become readily

tradable, or other events that cause current stockholders to sell shares, could place further downward pressure on the trading price of

In addition, the lack of a robust resale market may require a stockholder who desires to sell a large number of shares to sell

the shares in increments over time to mitigate any adverse impact of the sales on the market price of our stock.

We could issue additional common stock,

which might dilute the book value of our capital stock.

The Company may issue all or a part of its authorized

but unissued shares of common stock.

Any such stock issuance could be made at a price that reflects a discount or a premium to the then-current trading

price of our common stock.

In addition, in order to raise future capital, we may need to issue securities that are convertible into or

exchangeable for a significant amount of our common stock.

These issuances, if any, would dilute your percentage ownership interest in

the Company, thereby having the effect of reducing your influence on matters on which stockholders vote.

You may incur additional dilution

if holders of stock options or warrants, whether currently outstanding or subsequently granted, exercise their options, or if warrant

holders exercise their warrants to purchase shares of our common stock.

As a result, any such issuances or exercises would dilute your

interest in the Company and the per share book value of the common stock that you owned, either of which could negatively affect the trading

price of our common stock and the value of your investment.

Shares eligible for future sale may adversely

affect the market for our common stock.

As of March 5, 2022, there are 9,963,127 warrants

to purchase shares of our common stock outstanding and options to purchase 121,625 shares of our common stock outstanding.

options have a weighted average exercise price of $5.02 per share.

you may not be able to

liquidate your investment in our securities;

you may not be able to

resell your securities at or above the public offering price;

the market price of our

common stock may experience more price volatility;

there may be less efficiency

in carrying out your purchase and sale orders.

market price of our common stock may be highly volatile, and you could lose all or part of your investment.

trading price of our common stock is likely to be volatile.

This volatility may prevent you from being able to sell your shares at or

above the price you paid for your shares.

Our stock price could be subject to wide fluctuations in response to a variety of factors,

which include:

whether we achieve our

anticipated corporate objectives;

actual or anticipated fluctuations

in our quarterly or annual operating results;

changes in financial or

operational estimates or projections;

termination of the lock-up agreement

or other restrictions on the ability of our stockholders and other security holders to sell shares;

changes in the economic

performance or market valuations of companies similar to ours;

general economic or political

conditions in the United States or elsewhere.

addition, the stock market in general, and the stock of companies that are competitive to us in particular, have experienced extreme

price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of these companies.

market and industry factors may negatively affect the market price of our common stock, regardless of our actual operating performance.

our shares become subject to the penny stock rules, it would become more difficult to trade our shares.

SEC has adopted rules that regulate broker-dealer practices in connection with transactions in penny stocks.

Penny stocks are generally

equity securities with a price of less than $5.00, other than securities registered on certain national securities exchanges or authorized

for quotation on certain automated quotation systems, provided that current price and volume information with respect to transactions

in such securities is provided by the exchange or system.

If we do not retain a listing on a national securities exchange and if the

price of our common stock is less than $5.00, our common stock will be deemed a penny stock.

The penny stock rules require a broker-dealer,

before a transaction in a penny stock not otherwise exempt from those rules, to deliver a standardized risk disclosure document containing

specified information.

In addition, the penny stock rules require that before effecting any transaction in a penny stock not otherwise

exempt from those rules, a broker-dealer must make a special written determination that the penny stock is a suitable investment

for the purchaser and receive (i) the purchaser’s written acknowledgment of the receipt of a risk disclosure statement;

written agreement to transactions involving penny stocks;

and (iii) a signed and dated copy of a written suitability statement.

disclosure requirements may have the effect of reducing the trading activity in the secondary market for our common stock, and therefore

stockholders may have difficulty selling their shares.

a “thinly-traded” stock, large sales can place downward pressure on our stock price.

stock experiences periods when it could be considered “thinly traded”.

Financing transactions resulting in a large number

of newly issued shares that become readily tradable, or other events that cause current stockholders to sell shares, could place further

downward pressure on the trading price of our stock.

In addition, the lack of a robust resale market may require a stockholder who desires

to sell a large number of shares to sell the shares in increments over time to mitigate any adverse impact of the sales on the market

price of our stock.

could issue additional common stock, which might dilute the book value of our capital stock.

Company may issue all or a part of its authorized but unissued shares of common stock.

Any such stock issuance could be made at a price

that reflects a discount or a premium to the then-current trading price of our common stock.

In addition, in order to raise future

capital, we may need to issue securities that are convertible into or exchangeable for a significant amount of our common stock.

issuances, if any, would dilute your percentage ownership interest in the Company, thereby having the effect of reducing your influence

on matters on which stockholders vote.

You may incur additional dilution if holders of stock options or warrants, whether currently outstanding

or subsequently granted, exercise their options, or if warrant holders exercise their warrants to purchase shares of our common stock.

As a result, any such issuances or exercises would dilute your interest in the Company and the per share book value of the common stock

that you owned, either of which could negatively affect the trading price of our common stock and the value of your investment.

eligible for future sale may adversely affect the market for our common stock.

As of March 29, 2023, there are 8,563,127 warrants to purchase shares

of our common stock outstanding (with a weighted average exercise price of $5.02) and 2,362,321 outstanding options to purchase shares

of common stock (with a weighted average exercise price of $0.0064).

If and when these securities are exercised into shares of our common

2 unchanged sentences

shares, could have a material adverse effect on the market for our common stock and the market price of our common stock.

In addition, from time to time, all of our current

stockholders are eligible to sell all or some of their shares of common stock by means of ordinary brokerage transactions in the open

market pursuant to Rule 144, promulgated under the Securities Act, subject to certain limitations.

In general, pursuant to Rule 144, after

satisfying a six month holding period:

(i) affiliated stockholders (or stockholders whose shares are aggregated) may, under certain circumstances,

sell within any three month period a number of securities which does not exceed the greater of 1% of the then outstanding shares of common

stock or the average weekly trading volume of the class during the four calendar weeks prior to such sale and (ii) non-affiliated stockholders

may sell without such limitations, provided that we are current in our public reporting obligations.

Rule 144 also permits the sale of

securities by non-affiliates that have satisfied a one year holding period without any limitation or restriction.

Any substantial

sale of our common stock pursuant to Rule 144 or pursuant to any resale prospectus may have a material adverse effect on the market price

of our securities.

Because certain principal stockholders own

a large percentage of our voting stock, other stockholders’ voting power may be limited.

As of March 18, 2022, Ronny Yakov, our chief

executive officer, owned or controlled approximately 30.4% of our outstanding voting stock.

addition, from time to time, all of our current stockholders are eligible to sell all or some of their shares of common stock by means

of ordinary brokerage transactions in the open market pursuant to Rule 144, promulgated under the Securities Act, subject to certain

In general, pursuant to Rule 144, after satisfying a six month holding period:

(i) affiliated stockholders (or stockholders

whose shares are aggregated) may, under certain circumstances, sell within any three month period a number of securities which does not

exceed the greater of 1% of the then outstanding shares of common stock or the average weekly trading volume of the class during the

four calendar weeks prior to such sale and (ii) non-affiliated stockholders may sell without such limitations, provided that we

are current in our public reporting obligations.

Rule 144 also permits the sale of securities by non-affiliates that have satisfied

a one year holding period without any limitation or restriction.

Any substantial sale of our common stock pursuant to Rule 144 or pursuant

to any resale prospectus may have a material adverse effect on the market price of our securities.

certain principal stockholders own a large percentage of our voting stock, other stockholders’ voting power may be limited.

of March 28, 2023, Ronny Yakov, our chief executive officer, owned or controlled approximately 33.04% of our outstanding voting stock.

Accordingly, Mr.

Yakov has the ability

to have a substantial influence on matters submitted to our stockholders for approval, including the election and removal of directors

and the approval of any merger, consolidation or sale of all or substantially all of our assets.

As a result, our other stockholders may

have little influence over matters submitted for stockholder approval.

In addition, the ownership of Mr.

Yakov could preclude any

unsolicited acquisition of us, and consequently, adversely affect the price of our common stock.

Further, he may make decisions that are

adverse to your interests.

As an “emerging growth company”

under applicable law, we will be subject to lessened disclosure requirements, which could leave our stockholders without information or

rights available to stockholders of more mature companies.

For as long as we remain an “emerging growth

company”, we have elected to take advantage of certain exemptions from various reporting requirements that are applicable to other

public companies that are not “emerging growth companies” including, but not limited to:

not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act;

taking advantage of an extension of time to comply with new or revised financial accounting standards;

reduced disclosure obligations regarding executive compensation in our periodic reports and proxy statements;

exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously approved.

We expect to take advantage of these reporting

exemptions until we are no longer an “emerging growth company.” Because of these lessened regulatory requirements, our stockholders

would be left without information or rights available to stockholders of more mature companies.

Because we have elected to use the extended

transition period for complying with new or revised accounting standards for an “emerging growth company” our financial statements

may not be comparable to companies that comply with public company effective dates.

We have elected to use the extended transition

period for complying with new or revised accounting standards for an emerging growth company.

This election allows us to delay the adoption

of new or revised accounting standards that have different effective dates for public and private companies until those standards apply

to private companies.

As a result of this election, our financial statements may not be comparable to companies that comply with public

company effective dates, and thus investors may have difficulty evaluating or comparing our business, performance or prospects in comparison

to other public companies, which may have a negative impact on the value and liquidity of our common stock.

Anti-takeover provisions in our charter

documents and Delaware law could discourage, delay or prevent a change in control of our company and may affect the trading price of our

common stock.

The anti-takeover provisions of the Delaware

General Corporation Law may discourage, delay or prevent a change in control by prohibiting us from engaging in a business combination

with an interested stockholder for a period of three years after the person becomes an interested stockholder, even if a change in control

would be beneficial to our existing stockholders.

In addition, our certificate of incorporation, as amended (which we refer to as the

certificate of incorporation), and bylaws, as amended (which we refer to as the bylaws), may discourage, delay or prevent a change in

our management or control over us that stockholders may consider favorable.

Our certificate of incorporation and bylaws:

provide that vacancies on our board of directors, including newly created directorships, may be filled only by a majority vote of directors then in office;

provide that special meetings of stockholders may be called by a majority vote of our board of directors or at least 25% of shares held by our stockholders;

not provide stockholders with the ability to cumulate their votes;

provide that a majority of our stockholders (over 50%) and a vote by the majority of our board may amend our bylaws.

We do not expect to pay dividends for the

foreseeable future.

We do not expect to pay dividends on our common

stock offered in this transaction for the foreseeable future.

Accordingly, any potential investor who anticipates the need for current

dividends should not purchase our securities.

Risks Related to Public Companies

We could be delisted from NASDAQ, which

could seriously harm the liquidity of our stock and our ability to raise capital.

If we cease to be eligible to trade on the NASDAQ

Capital Market:

We may have to pursue trading on a less recognized or accepted market, such as the OTC Bulletin Board or the “pink sheets.”

The trading price of our common stock could suffer, including an increased spread between the “bid” and “asked” prices quoted by market makers.

Shares of our common stock could be less liquid and marketable, thereby reducing the ability of stockholders to purchase or sell our shares as quickly and as inexpensively as they have done historically.

If our stock is traded as a “penny stock,” transactions in our stock would be more difficult and cumbersome.

We may be unable to access capital on favorable terms or at all, as companies trading on alternative markets may be viewed as less attractive investments with higher associated risks, such that existing or prospective institutional investors may be less interested in, or prohibited from, investing in our common stock.

Yakov has the ability to have a substantial influence on matters submitted to our stockholders for approval, including

the election and removal of directors and the approval of any merger, consolidation or sale of all or substantially all of our assets.

As a result, our other stockholders may have little influence over matters submitted for stockholder approval.

In addition, the ownership

Yakov could preclude any unsolicited acquisition of us, and consequently, adversely affect the price of our common stock.

Further, he may make decisions that are adverse to your interests.

an “emerging growth company” under applicable law, we will be subject to lessened disclosure requirements, which could leave

our stockholders without information or rights available to stockholders of more mature companies.

as long as we remain an “emerging growth company”, we have elected to take advantage of certain exemptions from various reporting

requirements that are applicable to other public companies that are not “emerging growth companies” including, but not limited

not being required to comply

with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act;

taking advantage of an

extension of time to comply with new or revised financial accounting standards;

reduced disclosure obligations

regarding executive compensation in our periodic reports and proxy statements;

exemptions from the requirements

of holding a nonbinding advisory vote on executive compensation and stockholder approval of any golden parachute payments not previously

expect to take advantage of these reporting exemptions until we are no longer an “emerging growth company.” Because of these

lessened regulatory requirements, our stockholders would be left without information or rights available to stockholders of more mature

we have elected to use the extended transition period for complying with new or revised accounting standards for an “emerging growth

company” our financial statements may not be comparable to companies that comply with public company effective dates.

have elected to use the extended transition period for complying with new or revised accounting standards for an emerging growth company.

This election allows us to delay the adoption of new or revised accounting standards that have different effective dates for public and

private companies until those standards apply to private companies.

As a result of this election, our financial statements may not be

comparable to companies that comply with public company effective dates, and thus investors may have difficulty evaluating or comparing

our business, performance or prospects in comparison to other public companies, which may have a negative impact on the value and liquidity

of our common stock.

Anti-takeover provisions

in our charter documents and Delaware law could discourage, delay or prevent a change in control of our company and may affect the trading

price of our common stock.

anti-takeover provisions of the Delaware General Corporation Law may discourage, delay or prevent a change in control by prohibiting

us from engaging in a business combination with an interested stockholder for a period of three years after the person becomes an interested

stockholder, even if a change in control would be beneficial to our existing stockholders.

In addition, our certificate of incorporation,

as amended (which we refer to as the certificate of incorporation), and bylaws, as amended (which we refer to as the bylaws), may discourage,

delay or prevent a change in our management or control over us that stockholders may consider favorable.

Our certificate of incorporation

provide that vacancies

on our board of directors, including newly created directorships, may be filled only by a majority vote of directors then in office;

provide that special meetings

of stockholders may be called by a majority vote of our board of directors or at least 25% of shares held by our stockholders;

not provide stockholders

with the ability to cumulate their votes;

provide that a majority

of our stockholders (over 50%) and a vote by the majority of our board may amend our bylaws.

do not expect to pay dividends for the foreseeable future.

do not expect to pay dividends on our common stock offered in this transaction for the foreseeable future.

Accordingly, any potential

investor who anticipates the need for current dividends should not purchase our securities.

Related to Public Companies

could be delisted from NASDAQ, which could seriously harm the liquidity of our stock and our ability to raise capital.

we cease to be eligible to trade on the NASDAQ Capital Market:

We may have to pursue trading

on a less recognized or accepted market, such as the OTC Bulletin Board or the “pink sheets.”

The trading price of our

common stock could suffer, including an increased spread between the “bid” and “asked” prices quoted by market

Shares of our common stock

could be less liquid and marketable, thereby reducing the ability of stockholders to purchase or sell our shares as quickly and as

inexpensively as they have done historically.

If our stock is traded as a “penny stock,” transactions in our stock would

be more difficult and cumbersome.

We may be unable to access

capital on favorable terms or at all, as companies trading on alternative markets may be viewed as less attractive investments with

higher associated risks, such that existing or prospective institutional investors may be less interested in, or prohibited from,

investing in our common stock.

This may also cause the market price of our common stock to decline.

We incur substantial costs as a result of

being a public company and our management expects to devote substantial time to public company compliance programs.

As a public company, we incur significant legal,

insurance, accounting and other expenses, including costs associated with public company reporting.

We intend to invest resources to comply

with evolving laws, regulations and standards, and this investment will result in increased general and administrative expenses and may

divert management’s time and attention from product development and commercialization activities.

If our efforts to comply with

new laws, regulations and standards differ from the activities intended by regulatory or governing bodies due to ambiguities related to

practice, regulatory authorities may initiate legal proceedings against us, and our business may be harmed.

These laws and regulations

could make it more difficult and costlier for us to obtain director and officer liability insurance for our directors and officers, and

we may be required to accept reduced coverage or incur substantially higher costs to obtain coverage.

These factors could also make it

more difficult for us to attract and retain qualified executive officers and qualified members of our board of directors, particularly

to serve on our audit and compensation committees.

In addition, if we are unable to continue to meet the legal, regulatory and other requirements

related to being a public company, we may not be able to maintain the listing of our common stock on The NASDAQ Capital Market, which

would likely have a material adverse effect on the trading price of our common stock.

Securities analysts may not continue to

provide coverage of our common stock or may issue negative reports, which may have a negative impact on the market price of our common

Since completing our public offering of shares

of our common stock in August 2020, a limited number of securities analysts have been providing research coverage of our common stock.

If securities analysts do not continue to cover our common stock, the lack of research coverage may cause the market price of our common

stock to decline.

The trading market for our common stock may be affected in part by the research and reports that industry or financial

analysts publish about our business.

If one or more of the analysts who elect to cover us downgrade our stock, our stock price could decline

If one or more of these analysts cease coverage of us, we could lose visibility in the market, which in turn could cause our

stock price to decline.

In addition, under the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley Act, and a global settlement among the

Securities and Exchange Commission, or the SEC, other regulatory agencies and a number of investment banks, which was reached in 2003,

many investment banking firms are required to contract with independent financial analysts for their stock research.

It may be difficult

for a company such as ours, with a smaller market capitalization, to attract independent financial analysts that will cover our common

incur substantial costs as a result of being a public company and our management expects to devote substantial time to public company

compliance programs.

a public company, we incur significant legal, insurance, accounting and other expenses, including costs associated with public company

We intend to invest resources to comply with evolving laws, regulations and standards, and this investment will result in

increased general and administrative expenses and may divert management’s time and attention from product development and commercialization

If our efforts to comply with new laws, regulations and standards differ from the activities intended by regulatory or governing

bodies due to ambiguities related to practice, regulatory authorities may initiate legal proceedings against us, and our business may

These laws and regulations could make it more difficult and costlier for us to obtain director and officer liability insurance

for our directors and officers, and we may be required to accept reduced coverage or incur substantially higher costs to obtain coverage.

These factors could also make it more difficult for us to attract and retain qualified executive officers and qualified members of our

board of directors, particularly to serve on our audit and compensation committees.

In addition, if we are unable to continue to meet

the legal, regulatory and other requirements related to being a public company, we may not be able to maintain the listing of our common

stock on The NASDAQ Capital Market, which would likely have a material adverse effect on the trading price of our common stock.

analysts may not continue to provide coverage of our common stock or may issue negative reports, which may have a negative impact on

the market price of our common stock.

completing our public offering of shares of our common stock in August 2020, a limited number of securities analysts have been providing

research coverage of our common stock.

If securities analysts do not continue to cover our common stock, the lack of research coverage

may cause the market price of our common stock to decline.

The trading market for our common stock may be affected in part by the research

and reports that industry or financial analysts publish about our business.

If one or more of the analysts who elect to cover us downgrade

our stock, our stock price could decline rapidly.

If one or more of these analysts cease coverage of us, we could lose visibility in

the market, which in turn could cause our stock price to decline.

In addition, under the Sarbanes-Oxley Act of 2002, or the Sarbanes-Oxley

Act, and a global settlement among the Securities and Exchange Commission, or the SEC, other regulatory agencies and a number of investment

banks, which was reached in 2003, many investment banking firms are required to contract with independent financial analysts for their

stock research.

It may be difficult for a company such as ours, with a smaller market capitalization, to attract independent financial

analysts that will cover our common stock.

This could have a negative effect on the market price of our 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.

What changed 10-K

Item 1A. Risk Factors