What changed in this filing

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Item 1A. Risk Factors

2025-11-10 compared with 2025-08-14 · 46 added, 892 removed, 0 unchanged (100% of the section changed)

Relating to our Business and Industry

have incurred significant operating and net losses since our inception and anticipate that we will continue to incur significant losses

for the foreseeable future.

reflected in our financial statements included elsewhere in this quarterly report, we have a history of losses since our inception, including

net losses of $7,620,000 and $2,968,000 for the six months ended June 30, 2025 and fiscal year ended December 31, 2024, respectively,

and cash used in operating activities of $7,577,000 and $2,485,000 for the six months ended June 30, 2025 and fiscal year ended December

31, 2024, respectively.

As of December 31, 2024, we had an accumulated deficit of $1,922,000 and a working capital deficit of $5,735,000.

the preceding conditions, our auditor has raised substantial doubt about our ability to continue as a going concern.

Our ability to continue

as a going concern depends upon our ability to generate positive operating cash flows.

To support our working capital needs, we will

rely on our revenue generating customer contracts and equity and/or debt financing.

There is no assurance that we will be successful

in generating positive operating cash flows and raising additional capital significant enough to result in operating profitability in

we are unable to generate and raise sufficient positive operating cash flows and additional capital to result in operating profitability

in the future, there may remain substantial doubt about our ability to continue as a going concern, and investors or other financing

sources may be unwilling to provide funding to us on commercially reasonable terms or at all, and we may have to discontinue operations

and liquidate our assets and may be compelled to receive less than the value at which those assets are carried on our audited financial

statements, which would cause our stockholders to lose a part or all of their investment.

business depends on our ability to attract new customers and retain and provide services to existing customers.

Any decline in customer

acquisition or retention would harm our business.

business depends upon our ability to attract new customers, and maintain and expand our relationships with our existing customers, including

providing additional services to our existing customers.

Our customers engage us to provide support for their events or other corporate

We cannot provide any assurance that customers will extend or renew their engagement with us after the events or corporate

activities for which we have been engaged are completed.

Extensions or renewals of customer engagement may decline or fluctuate because

of several factors, such as dissatisfaction with our platform and support, a customer no longer having a need for our platform, or a

belief that a competitor’s service offering is better, more secure, or less expensive than our platform.

For example, during the

COVID-19 pandemic, we saw a significant increase in usage of our platform and services.

Following the pandemic, some of our customers

reduced their use of our platform, and additional customers may do so in the future.

Extensions or renewals of customer engagement are

also impacted by reductions in customers’ information technology spending budgets or decisions by customers to consolidate their

spending budgets on one of our competitor’s platforms, both of which are more likely to occur during periods of high inflation,

recessionary or uncertain economic environments.

Finally, any decrease in customer satisfaction with our platform or support would harm

our brand, word-of-mouth referrals, and ability to grow.

We need to continually add new customers to grow our business and to replace

customers who choose not to continue to use our platform.

If customers terminate or do not renew their business relationships with us,

or renew their service contracts on less favorable terms or for fewer services, and we do not acquire replacement customers or otherwise

grow our customer base, our business and results of operations may be materially and adversely affected.

decline in demand for our services or platform could harm our business .

derive, and expect to continue to derive, a significant portion of our revenue and cash flows from producing virtual and hybrid events.

Widespread adoption and use of live engagement technologies, webinars and event software in general, and our platform in particular,

are critical to our future growth and success.

If this market fails to grow or grows more slowly than we currently anticipate, demand

for our platform could be negatively affected.

for our platform is affected by a number of factors, many of which are beyond our control.

Some of these potential factors include:

availability of products

and services that compete, directly or indirectly, with ours;

awareness and adoption

of live engagement technologies, generally, as a substitute for in-person events;

ease of adoption and use

of the relevant technologies;

features and platform experience;

reliability of our platform,

including frequency of outages;

performance and user support;

our brand and reputation;

security and privacy;

our pricing and our competitors’

new modes of live engagement

that may be developed in the future.

we fail to successfully predict and address these factors, meet customer demands or achieve more widespread market adoption of our platform,

our business would be harmed.

experience of our customers depends upon the interoperability of our platform across technologies that we do not control, and if we are

not able to maintain and expand our relationships with third parties in order to integrate our platform with their products, our business

may be harmed.

platform, Xyvid Pro Platform, has broad interoperability and is able to integrate and deliver event content to various devices, including

Windows, Mac, iOS, and Android.

We depend on the accessibility of our platform across these devices that we do not control.

competitors may have inherent advantages by being able to develop products and services internally that more closely integrate with their

own software platforms or those of their business partners.

may not be able to modify our platform and services to maintain their continued compatibility with that of third parties’ products

and services that are constantly evolving.

In addition, some of our competitors may be able to disrupt the ability of our platform to

operate with their products or services, or they could exert strong business influence on our ability to, and the terms on which we,

operate and provide access to our platform and services.

Should any of these third parties modify their products or services in a manner

that degrades the functionality of our platform or services, or that gives preferential treatment to their own or competitive products

or services, whether to enhance their competitive position or for any other reason, the interoperability of our platform and services

with these third-party products and services could decrease and our business could be harmed.

may not be able to respond to rapid technological changes, extend our platform or develop new features.

markets in which we compete are characterized by rapid technological changes and the frequent introduction of new products and services.

Our ability to attract new customers and retain and expand the usage of existing customers depends on our ability to enhance and improve

our platform, and to introduce new features and services.

Our customers may require features and capabilities that our current platform

does not have.

We are focused on improving the quality and range of our service offerings and are committed to investing in research

and development.

Our enhancements to our platform, features or capabilities may not be compelling to our existing or potential customers

and may not gain market acceptance.

If our research and development investments do not accurately anticipate customer demand, or if we

fail to develop our platform in a manner that satisfies customer preferences in a timely and cost-effective manner, we may fail to retain

our existing customers or increase demand for our platform.

introduction of competing services or the development of entirely new technologies to replace existing offerings could make our platform

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

We may experience difficulties with software

development, design or marketing that could delay or prevent our development, introduction, or implementation of new services, features,

or capabilities.

New services, features or capabilities may not be released according to schedule.

Any delays could result in adverse

publicity, loss of revenue or market acceptance, or claims by customers brought against us, all of which could harm our business.

customers do not widely adopt our new services, features and capabilities, we may not be able to realize a return on our investment.

If we are unable to develop, license or acquire new features and capabilities to our platform on a timely and cost-effective basis, or

if such enhancements do not achieve market acceptance, our business would be harmed.

plan to incorporate AI technologies into some of our products and services, which may present operational and reputational risks.

of the date of this quarterly report, we utilize artificial intelligence, or AI, to empower the multi-language captioning and transcription

features of our TEN Pro Platform, and we plan to implement additional features driven by artificial intelligence in the future.

AI-driven enhancements are expected to be available in the second half of 2025.

As with many innovations, there are associated risks

involved in utilizing AI technology.

There can be no assurance that our use of AI will eventually produce the intended results.

if it could produce the intended results, we cannot guarantee that such AI will not produce errors going forward.

AI, particularly generative

AI, has been known to produce false or “hallucinatory” inferences or outputs.

AI can also present ethical issues and may

subject us to new or heightened legal, regulatory, ethical, or other challenges.

Inappropriate or controversial data practices by developers

and end-users, or other factors adversely affecting public opinion concerning AI, could impair the acceptance of AI solutions, including

those incorporated in our services.

If the AI tools that we use are deficient, inaccurate, or controversial, we could incur operational

inefficiencies, competitive harm, legal liability, brand or reputational harm, or other adverse impacts on our business and financial

addition, regulation of AI is rapidly evolving worldwide, as legislators and regulators are increasingly focused on these powerful emerging

technologies.

The technologies underlying AI and its uses are subject to a variety of laws and regulations, including intellectual property,

data privacy and security, customer protection, competition, and equal opportunity laws, and are expected to be subject to increased

regulation and new laws or new applications of existing laws and regulations.

For example, In the United States, President Biden issued

the Executive Order on Safe, Secure and Trustworthy Artificial Intelligence in October 2023, with the goal of promoting the “safe,

secure, and trustworthy development and use of artificial intelligence in the United States.” The Executive Order has established

certain new standards for the training, testing and cybersecurity of sophisticated AI models.

It has also instructed other federal agencies

to promulgate additional regulations within certain timeframes from the date of the Executive Order.

Federal artificial intelligence

legislation has also been introduced in the U.S.

Since these regulatory frameworks rapidly evolve, we may become subject to new

laws and regulations, which may affect the legality, profitability, or sustainability of our business, and we may be unable to predict

all the legal, operational, or technological risks that may arise relating to the use of AI.

The failure to comply with the relevant

regulatory frameworks may also negatively affect our reputation.

Because AI technology itself is highly complex and rapidly developing,

it is not possible to predict all the legal, operational, or technological risks that may arise relating to the use of AI.

appropriately respond to this evolving landscape may result in legal liability, regulatory action, or brand and reputational harm.

of the date of this quarterly report, the Company does not intend to utilize open-source AI.

Interruptions

in our services caused by undetected errors, failures, or bugs in our platform or services could harm our reputation and result in significant

platform and services may have errors or defects that customers identify after they begin using them that could result in unanticipated

interruptions of service.

Internet-based services frequently contain undetected errors and bugs when first introduced or when new versions

or enhancements are released.

The use of our services in complicated, large-scale network environments may increase our exposure to undetected

errors, failures, or bugs in our services.

We use monitoring software to detect errors or bugs in our platform and we subject new codes

to stringent testing before their release.

As of the date of this quarterly report, we have not experienced significant interruptions

in our services as a result of such errors or defects, but we may experience future interruptions of service if we fail to detect and

correct these errors and defects.

As our business expands, the costs incurred in correcting defects, bugs or errors may be substantial

and could harm our results of operations.

addition, we rely on hardware and software of third parties to offer our services.

Any defects in, or unavailability of, our or third-party

software or hardware that cause interruptions of our services could, among other things:

cause a reduction in revenues

or a delay in market acceptance of our services;

require us to pay penalties

or issue refunds to our customers or partners, or expose us to claims for damages;

cause us to lose existing

customers and make it more difficult to attract new customers;

divert our development

resources or require us to make extensive changes to our software, which would increase our expenses and slow innovation;

increase our technical

support costs;

harm our reputation and

in our markets is intense, and if we do not compete effectively, our operating results could be harmed.

webcasting market is competitive and rapidly changing, and existing and new market entrants, particularly established companies with

greater resources than we have, that provide technologies to improve communication and engagement technologies or platforms, such as

artificial intelligence and machine learning, could also increase the level of competition in the market.

We face competition from many

large and small companies, which include, but are not limited to, Zoom, ON24, GlobalMeet, Cvent, Bizzabo, and Meeting Tomorrow.

competitors vary in size and in the breadth and scope of the products and services they offer.

Many of our actual and potential competitors

benefit from competitive advantages over us, such as greater name recognition;

longer operating histories;

more varied products and services;

larger marketing budgets;

more established marketing relationships;

more third-party integration;

greater accessibility across devices

or applications;

greater access to larger user bases;

and greater financial, technical, and other resources.

Some of our competitors

may make acquisitions or strategic investments or enter into strategic relationships to offer a broader range of products and services

than we do, which may prevent us from using such third parties’ technology or offering such products or services.

These combinations

may make it more difficult for us to compete effectively.

We expect these trends to continue as competitors attempt to strengthen or

maintain their market positions.

As we introduce new services, and with the introduction of new technologies and market entrants, we

expect competition to intensify in the future.

for our platform is price sensitive.

Many factors, including our pricing and marketing strategies, customer acquisition, and technology

costs, as well as the pricing and marketing strategies of our competitors, can significantly affect our pricing strategies.

Certain competitors

offer, or may in the future offer, lower-priced or free products or services that compete with our platform or certain aspects of our

platform, and they may offer a broader range of products and services than we do.

Even if such competing products do not include all

of the features and functionality that we provide, we could face pricing pressure to the extent that customers find such alternative

products to be sufficient to meet their needs.

Similarly, certain competitors or potential competitors may use marketing strategies that

enable them to acquire customers at a lower cost than we can.

Moreover, our major customers may demand substantial price concessions.

As a result, we may be required to provide our major customers with pricing below our targets in the future.

As a result, we could lose

market share to our competitors or be forced to engage in price-cutting initiatives or other discounts to attract and retain customers,

each of which could harm our business, results of operations and financial condition.

failure to effectively develop and expand our marketing and sales capabilities could harm our ability to increase our customer base and

achieve broader market acceptance of our platform.

ability to increase our customer base and achieve broader market acceptance of our services will depend to a significant extent on our

ability to expand our marketing and sales operations.

We plan to continue expanding our sales and marketing capabilities, including through

additional investment in digital marketing and sales team expansion.

If we are unable to expand our sales and marketing operations, our

future revenue growth and business could be adversely impacted.

and recruiting qualified sales representatives and training them is time consuming and resource intensive, and they may not be fully

trained and productive for a significant amount of time.

We also plan to dedicate resources to sales and marketing programs, including

internet and other online advertising.

All of these efforts will require us to invest significant financial and other resources, as the

cost to acquire customers through these efforts is high.

Our business will be harmed if our efforts do not generate a correspondingly

significant increase in revenue.

largest customer generates a significant portion of our revenue, and interruption in operations of such significant customer may have

an adverse effect on our business, financial condition, and results of operations.

the six months ended June 30, 2025, there was one customer that independently accounted for more than 10% of our total revenue.

six months ended June 30, 2024, there was one customer that independently accounted for more than 10% of our total revenue.

believe that, in the foreseeable future, we may continue to derive a significant portion of our revenue from such significant customer.

If such customer fails to make payments, or experiences a downturn in business, our revenue and results of operations may be materially

and adversely affected.

We may lose our significant customer due to a variety of factors, including our capacity to deliver reliable

services, service efficiency, as well as our competitiveness in pricing strategies.

We cannot guarantee that we will continue to maintain

the business relationship with our significant customer at the same level, or at all.

If our significant customer terminates its relationship

with us, we cannot assure you that we will be able to secure an alternative arrangement with a comparable customer in a timely manner,

Losing our significant customer could adversely affect our revenue and profitability.

In the short term, losing our significant

customer may lead to a substantial loss of revenue and potentially disrupt cash flow.

In the long term, it could impact market perception

and our ability to attract new customers.

may be dependent on a limited number of suppliers and any disruption to the relationships with the major suppliers may have material

adverse effects on our business.

the six months ended June 30, 2025, there was one supplier that independently accounted for more than 10% of our total purchases, accounting

for approximately 14%, of our total purchases.

For the six months ended June 30, 2024, there was one supplier that independently accounted

for more than 10% of our total purchases, accounting for approximately 20%, of our total purchases.

Such third-party suppliers are subject

to their own unique operational and financial risks, which are beyond our control.

If such significant suppliers breach or terminate

their contracts with us, or experience significant disruptions to their operations, we will be required to find and enter into arrangements

with one or more replacement suppliers.

Finding alternative suppliers could involve significant delays and other costs and these suppliers

may not be available to us on reasonable terms, or at all.

As a result, this could harm our business and financial results and result

in lost or deferred revenue.

depend on our controlling stockholder, V-Cube, Inc., for financing and other resources.

owns the majority of our equity interest as of the date of this quarterly report.

We do not expect any material changes to our relationship

with V-Cube, Inc.

in the foreseeable future.

We have relied on and expect to continue to rely on V-Cube, Inc.

for financing and other

has made verbal pledges to provide financial support and other resources to our Company.

However, such pledges

have not been formalized by any contractual arrangements and there is no assurance that such financial support will be available as and

when needed or in sufficient amounts.

If there are any changes to our relationship with V-Cube, Inc., and/or if V-Cube, Inc.

or terminates its provision of financing and other resources to us, for a variety of reasons beyond our control, such as any changes

to the Japan-United States relations, any business interruptions or financial distress of V-Cube, Inc., or any legal changes that affect

international money transfers, it could have material adverse effects on our business and financial results.

results of operations are subject to seasonal fluctuations.

experience seasonality in our business.

We usually generate more revenue in the last month of each calendar quarter.

We may experience

capacity and resource shortages in our platform and services during the period of such seasonal surge in our business.

As a result of

seasonality, our financial condition and results of operations may continue to fluctuate, and the trading price of our common stock may

fluctuate from time to time.

business and results of operations may be harmed by the misconduct of authorized employees that have access to important assets of our

Company such as bank accounts and confidential information.

the course of our business operations, some of our employees have access to certain valuable assets of our Company, such as bank accounts

and confidential information.

In the event of misconduct by such authorized employees, our Company could suffer significant losses.

misconduct may include misappropriating bank accounts, falsifying bank records, improper use or disclosure of confidential information

to the public or our competitors, and failure to comply with our internal policies or with federal or state laws or regulations regarding

the use and safeguarding of classified or other protected information, and any other applicable laws or regulations.

Although we have

implemented policies, procedures, and controls to regulate employee conduct, these precautions may not prevent all intentional or negligent

misconduct, and as a result, we could face unknown risks or losses.

Furthermore, such unethical, unprofessional, or even criminal behavior

by employees could damage our reputation, result in fines, penalties, restitution, or other damages, and lead to the loss of current

and future customers, all of which would adversely affect our business, financial condition, and results.

may be the subject of detrimental conduct by third parties, which could have a negative impact on our reputation.

may be the target of anti-competitive, harassing, or other detrimental conduct by third parties including our competitors.

may include complaints, anonymous or otherwise, to regulatory agencies regarding our operations, accounting, business relationships,

business prospects, and business ethics.

Additionally, anyone may post false allegations online against us on an anonymous basis.

may be subject to government or regulatory investigation as a result of such third-party conduct and may be required to expend significant

time and incur substantial costs to address such third-party conduct, and there can be no assurance that each of the allegations will

be refuted conclusively within a reasonable period of time, or at all.

Our business may also be materially negatively affected as a result

of such public dissemination of anonymous allegations or malicious statements.

Interruptions,

delays or outages in service from the data centers we use for our technology or infrastructure could impair the delivery and the functionality

of our services, which may harm our business.

ability to attract and retain customers depends on our ability to provide our customers and their users with a highly reliable platform.

We currently use data centers in the United States.

Our platform may not be fully available to customers in the event of catastrophic

failure at one of those data centers.

We also do not control the operation of the data centers we use, and they are vulnerable to damage

or interruption from human error, intentional bad acts, natural disasters, war, terrorist attacks, cyber-attacks and other cybersecurity

incidents, power losses, hardware failures, systems failures, telecommunications failures and similar events, any of which could disrupt

our services.

In the event of significant physical damage to one of these data centers, it may take a significant period of time to achieve

full resumption of our platform, and our disaster recovery planning may not account for all eventualities.

We have previously experienced

service disruptions, outages and other performance problems, due to the introduction of new functionality, human error, and capacity

constraints, and we may in the future experience further service disruptions, outages and other performance problems due to a variety

of other factors, including infrastructure changes, software errors, zero-day vulnerabilities, and denial-of-service attacks, ransomware

attacks and other cybersecurity incidents by malicious actors.

In some instances, we may not be able to rectify these performance issues

within an acceptable time-frame.

We have not experienced any such service disruptions, outages, or other performance issues during the

period covered by this quarterly report.

addition, we depend on the expertise and efforts of members of our operations and technology teams for the continued performance of our

Our ability to retain, attract, hire and train staff in these groups may prove to be a challenge for a variety of factors and

could have an adverse impact on the platform.

our platform is unavailable or if our customers and their users are unable to access our platform within a reasonable amount of time,

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

Additionally, if the data centers

we use are unable to keep up with our increasing need for capacity, our customers may experience delays as we seek to obtain additional

capacity, which could harm our business.

Cybersecurity

incidents could disrupt our business operations, result in the loss of critical and confidential information, adversely impact our reputation,

and harm our business.

Cybersecurity

threats and incidents directed at us could range from uncoordinated individual attempts to gain unauthorized access to information technology

systems to sophisticated and targeted measures aimed at disrupting business or gathering data of customers.

We rely on our platform to

deliver virtual and hybrid events to our customers and we use the Azure SQL Database to process, organize and store our business data.

The secure processing, maintenance, and transmission of information in these systems are critical to our operations.

our technology operations are vulnerable to security breaches and attacks against our system and network.

While we employ measures designed

to prevent, detect, address, and mitigate these threats (including using third-party cybersecurity technology), and we have not experienced

any material cybersecurity incidents as of the date of this quarterly report, cybersecurity incidents, depending on their nature and

scope, could potentially result in the misappropriation, destruction, corruption, or unavailability of critical data and confidential

or proprietary information (our own or that of third parties, including potentially sensitive information of our customers) and the disruption

of business operations.

Any such compromises to our security could cause harm to our reputation, which could cause customers to lose

trust and confidence in us or could cause agents to stop working for us.

In addition, we may incur significant costs for remediation

that may include liability for stolen assets or information, repair of system damage, and compensation to customers and business partners.

We may also be subject to legal claims, government investigation, and additional state and federal statutory requirements.

have purchased cybersecurity insurance, there is no assurance that such insurance will be sufficient to cover any damages resulting from

cybersecurity claims.

potential consequences of a material cybersecurity incident include regulatory violations of applicable U.S.

privacy and other laws,

reputational damage, loss of market value, litigation with third parties (which could result in our exposure to material civil or criminal

liability), diminution in the value of the services we provide to our customers, and increased cybersecurity protection and remediation

costs (that may include liability for stolen assets or information), which in turn could have a material adverse effect on our competitiveness

and results of operations.

we fail to manage our growth or execute our strategies and future plans effectively, we may not be able to take advantage of market opportunities

or meet the demand of our customers.

expect our business to grow in terms of scale and diversity of operations.

In addition, we plan to improve the features of our platform

and incorporate more emerging technologies to enhance our platform.

This will enable us to diversify and expand our service offerings.

Such expansions will increase the complexity of our operations and may cause strain on our managerial, operational, and financial resources.

We must continue to hire, train, and effectively manage new employees.

The expansion of our services will also require us to maintain

consistency in the quality of our services so that our market reputation is not damaged by any deviations in quality, whether actual

or perceived.

future results of operations also depend largely on our ability to execute our future plans successfully.

In particular, our continued

growth may subject us to the following additional challenges and constraints:

we face challenges in responding

to evolving industry standards and government regulation that impact our business and the webcasting industry in general;

the technological or operational

challenges may arise from the new services;

the execution of our future

plans will be subject to the availability of funds to support the relevant capital investment and expenditures;

the successful execution

of our strategies is subject to factors beyond our control, such as general market conditions, and economic and political developments

in the United States and globally.

of these endeavors involve risks and will require significant management, financial, and human resources.

We cannot assure you that we

will be able to effectively manage our growth or to implement our strategies successfully.

There is no assurance that the investment

to be made by our Company as contemplated under our future plans will be successful and generate the expected return.

If we are not able

to manage our growth or execute our strategies effectively, or at all, our business, results of operations, and prospects may be materially

and adversely affected.

we fail to attract, recruit, or retain our key personnel, including our executive officers, senior management, and key employees, our

ongoing operations and growth could be affected.

success depends, to a large extent, on the efforts of our key personnel, including our executive officers, senior management, and other

key employees who have valuable experience, knowledge, and connections in the webcasting industry.

There is no assurance that these key

personnel will not voluntarily terminate their employment with us.

We do not carry any key person insurance on any of our senior management

The loss of any of our key personnel could be detrimental to our ongoing operations.

Our success will also depend on our ability

to attract and retain qualified personnel to manage our existing operations as well as our future growth.

We may not be able to successfully

attract, recruit, or retain key personnel, and this could adversely impact our financial condition, operating results, and business prospects.

may not maintain adequate insurance, which could expose us to significant costs and business disruption.

maintain certain insurance policies to safeguard against risks and unexpected events.

However, there can be no assurance that such insurance

coverage will always be available or will always be sufficient to cover any damages resulting from any kind of claims.

In addition, there

are certain types of risks that may not be covered by our insurance policies, such as war, force majeure events, or certain business

interruptions.

Claims that are not covered by the policies or the failure to renew the insurance policies may materially adversely affect

our business, financial condition, and results of operations.

may expand through acquisitions of, investments in, or strategic partnerships or other strategic transactions with, other companies,

each of which may divert our management’s attention, result in additional dilution to our stockholders, increase expenses, disrupt

our operations, and harm our results of operations.

business strategy may, from time to time, include acquiring or investing in new or complementary services, technologies or businesses,

strategic investments and partnerships, or other strategic transactions.

We plan to identify, invest in, partner with, and acquire appropriate

businesses that offer complementary advantages to our business, thereby improving overall competitiveness and sustaining growth.

assure you that we will successfully identify suitable acquisition candidates or transaction counterparties, securely or effectively

integrate or manage disparate technologies, lines of business, personnel and corporate cultures, realize our business strategy or the

expected return on our investment, or manage a geographically dispersed company.

Any such acquisition, investment, strategic partnership,

or other strategic transaction could materially and adversely affect our results of operations.

The process of negotiating, effecting,

and realizing the benefits from acquisitions, investments, strategic partnerships, and strategic transactions is complex, expensive and

time-consuming, and may cause an interruption of, or loss of momentum in, development and sales activities and operations of both companies,

and we may incur substantial cost and expense, as well as divert the attention of management.

We may issue equity securities which could

dilute current stockholders’ ownership, incur debt, assume contingent or other liabilities and expend cash in acquisitions, investments,

strategic partnerships, and other strategic transactions which could negatively impact our financial position, stockholder equity, and

Acquisitions,

investments, strategic partnerships, and other strategic transactions involve significant risks and uncertainties, including:

the potential failure to

achieve the expected benefits of the acquisition, investment, strategic partnership, or other strategic transaction, including recoupment

or write-down of our investments in the partnership;

unanticipated costs and

the potential of disputes

with our partners, including arbitration or litigation resulting from a breach or alleged breach of either party’s contractual

obligation, which may result in cost, distraction and potential liabilities and reputational damage;

difficulties in integrating

new services and subscriptions, software, businesses, operations, and technology infrastructure in an efficient and effective manner;

difficulties in maintaining

customer relations;

the potential loss of key

employees of any acquired businesses;

the diversion of the attention

of our senior management from the operation of our daily business;

the potential adverse effect

on our cash position to the extent that we use cash for the transaction consideration;

the potential significant

increase of our interest expense, leverage, and debt service requirements if we incur additional debt to pay for an acquisition,

investment, strategic partnership, or other strategic transaction;

the potential issuance

of securities that would dilute our stockholders’ percentage ownership;

the potential to incur

large and immediate write-offs and restructuring and other related expenses;

the inability to maintain

uniform standards, controls, policies, and procedures;

the inability to set up

the necessary processes and systems to efficiently operate the partnerships.

acquisition, investment, strategic partnership, or other strategic transaction could expose us to unknown liabilities.

Moreover, we cannot

assure you that we will realize the anticipated benefits of any acquisition, investment, strategic partnership, or other strategic transaction.

In addition, our inability to successfully operate and integrate newly acquired businesses or newly formed strategic partnerships appropriately,

effectively, and in a timely manner could impair our ability to take advantage of future growth opportunities and other advances in technology,

as well as our revenues and gross margins.

previous performance may not be sustainable or indicative of our future financial outcomes, and there is no assurance that we will be

able to achieve the same level of financial performance in the future.

the six months ended June 30, 2025 and 2024, we had total revenue of approximately $1,855,000 and $2,151,000, respectively, and net loss

of approximately $7,620,000 and $826,000, respectively.

Our financial results in the past may not be indicative of future results, and

we cannot assure you that we will achieve or maintain profitability on a consistent basis.

Our revenue growth may slow, or our revenue

may decline for a number of reasons, including reduced demand for our products and services, increased competition, industry trend, or

our failure to capitalize on growth opportunities.

Meanwhile, we expect our overall operating expenses to continue to increase in the

foreseeable future, as we will incur additional expenses in connection with the expansion of our business operations and as a newly public

These efforts and additional expenses may be more costly than we currently expect, and there is no assurance that we will be

able to maintain sufficient operating revenue to offset our operating expenses.

Any failure to increase revenue or to manage our costs

as we continue to grow and invest in our business would prevent us from achieving or maintaining profitability or maintaining positive

operating cash flow at all, or on a consistent basis, which would cause our business, financial condition, and results of operations

or weakened general economic and market conditions may cause a reduction in customer demand, which could harm our revenue, results of

operations, and cash flows.

revenue, results of operations, and cash flows depend on the overall demand for and use of our platform and services, which depends in

part on the amount of spending allocated by our customers or potential customers on the relevant services.

This spending depends on worldwide

economic and geopolitical conditions.

The United States and other key international economies have experienced cyclical downturns from

time to time in which economic activity was impacted by falling demand for a variety of goods and services, inflation (including wage

inflation), labor market constraints, restricted credit, poor liquidity, reduced corporate profitability, volatility in credit, equity,

and foreign exchange markets, bankruptcies, and overall economic uncertainty.

These economic conditions can arise suddenly, including

the recent rise in inflation and overall macroeconomic environment, which may negatively impact our customers’ budgets.

geopolitical developments, such as potential trade wars, and actions or inactions of the United States or other major national governments,

can increase levels of political and economic unpredictability globally and increase the volatility of global financial markets.

volatility, decreased consumer confidence, and diminished growth expectations in the United States economy and abroad as a result of

the foregoing events could adversely affect our customers’ ability or willingness to purchase our services, delay prospective customers’

purchasing decisions, reduce the value or duration of their contracts, or affect attrition rates, all of which could adversely affect

our future sales and operating results.

Some of our customers may view the usage of our platform as a discretionary purchase, and our

customers may reduce their discretionary spending on our platform during an economic downturn.

In addition, weak economic conditions,

including during times of high inflation and tightening budgets, can result in customers seeking to utilize lower-cost solutions that

are available from alternative sources.

Prolonged economic slowdowns may result in requests to renegotiate existing contracts on less

advantageous terms to us than those currently in place, payment defaults on existing contracts, or non-renewal at the end of a contract

business could be disrupted by catastrophic events.

of any catastrophic event, including pandemics such as COVID-19, earthquakes, fires, floods, tsunamis or other weather event, power loss,

telecommunications failure, software or hardware malfunctions, cyberattacks, war or terrorist attacks, could result in lengthy interruptions

in our services.

In particular, our corporate headquarters are located in Pennsylvania, a region known for flooding, and our insurance

coverage may not sufficiently compensate us for losses that may occur in the event of a severe flooding event or other significant natural

In addition, acts of terrorism could cause disruptions to the internet, the electric grid or the economy as a whole.

systems were to fail or be negatively impacted as a result of a natural disaster or other catastrophic event, our ability to deliver

our products and services to our customers would be impaired or we could lose critical data.

If we are unable to develop adequate plans

to ensure that our business functions continue to operate during and after a disaster and to execute successfully on those plans in the

event of a disaster or emergency, our business could be harmed.

Relating to Laws and Regulations

actual or perceived failure by us, our customers, partners or vendors to comply with stringent and evolving laws and regulations, industry

standards, policies, and contractual obligations relating to privacy, data protection, information security, and other matters could

harm our reputation and business and subject us to significant fines and liability.

the ordinary course of business, we collect, receive, store, process, generate, use, transfer, disclose, make accessible, protect, secure,

dispose of, transmit, and share confidential, proprietary, and sensitive information, including customer and user content, business data,

trade secrets, intellectual property, third-party data, business plans, transactions, financial information.

Our data processing activities

subject us to numerous privacy, data protection, and information security obligations, such as various laws, regulations, guidance, industry

standards, external and internal privacy and security policies, and contractual requirements.

the United States, federal, state, and local governments have enacted numerous privacy, data protection, and information security laws,

including data breach notification laws, consumer protection laws, and other similar laws.

While as of the date of this quarterly report,

we have not been subject to any legal or administrative penalties or received any notifications from regulatory authorities for privacy,

data protection, or information security concerns, the developments or changes to the applicable laws and regulations may complicate

compliance efforts and increase legal risk and compliance costs for us and the third parties upon whom we rely.

If we fail to comply

with stringent and evolving laws and regulations, industry standards, policies, and contractual obligations relating to privacy, data

protection, information security, and other matters, it could harm our reputation and business and subject us to significant fines and

are subject to a variety of U.S.

and international laws and regulations, compliance with which could impair our ability to compete and

non-compliance with which may result in claims, fines, penalties, and other consequences, all of which could adversely impact our operations,

business, or performance.

a service provider, we do not regularly monitor our platform to evaluate the legality of content shared on it by our customers.

as of the date of this quarterly report, we have not been subject to legal or administrative actions as a result of the content shared

on our platform, the laws in this area are evolving and vary widely between jurisdictions.

Accordingly, it may be possible that in the

future we and our business partners may be subject to legal actions involving our customers’ content or use of our platform.

platform depends on the ability of our customers and their users to access the internet.

If we fail to anticipate developments in the

law, or we fail for any reason to comply with relevant law, our platform could be blocked or restricted, and we could be exposed to significant

liability that could harm our business.

are subject to a variety of U.S.

laws and regulations, such as the Americans with Disabilities Act (ADA) which requires virtual events

to be accessible to individuals with disabilities, and various laws and regulations of states where we conduct business activities or

where digital content is distributed, livestreamed, or made available through our platform or services.

We are also subject to various

international regulations on information security, copyrights and intellectual properties.

To the extent we expand our market presence,

our exposure for violating these laws and regulations will likely increase.

If we fail to comply with the legal standards and requirements,

we may face substantial civil and criminal fines, penalties, profit disgorgement, reputational harm, loss of access to certain markets,

disbarment from government business, the loss of export privileges, tax reassessments, breach of contract, fraud and other litigation,

reputational harm, and other foreseeable or unforeseen collateral consequences that could harm our business.

Non-compliance

with laws and regulations on the part of any third parties with which we conduct business could expose us to legal expenses, compensation

to third parties, penalties, and disruptions of our business, which may adversely affect our results of operations and financial performance.

customers with which we conduct business, including healthcare organizations, as well as marketing and advertising agencies, may be subject

to regulatory penalties or punishments because of their regulatory compliance failures or infringement upon other parties’ legal

rights, which may, directly or indirectly, disrupt our business.

We cannot be certain whether such third parties have violated any regulatory

requirements or infringed or will infringe any other parties’ legal rights, which could expose us to legal expenses or compensation

to third parties, or both.

therefore, cannot rule out the possibility of incurring liabilities or suffering losses due to any non-compliance by third parties.

is no assurance that we will be able to identify irregularities or non-compliance in the business practices of third parties with which

we conduct business, or that such irregularities or non-compliance will be corrected in a prompt and proper manner.

Any legal liabilities

and regulatory actions affecting third parties involved in our business may affect our business activities and reputation, and may in

turn affect our business, results of operations, and financial performance.

regulatory penalties or punishments against our business stakeholders such as third-party service providers, whether or not resulting

in any legal or regulatory implications upon us, may nonetheless cause business interruptions or even suspension of these business stakeholders,

which could in turn disrupt our usual course of business and result in material negative impact on our business operations, results of

operation and financial condition.

to protect intellectual property rights could adversely affect our business.

regard our domain names and other intellectual property we may develop or acquire as critical to our success.

We have taken measures

to protect our intellectual property, but these measures might not be sufficient or effective.

We may bring lawsuits to protect against

the potential infringement of our intellectual property rights.

Policing unauthorized use of our proprietary technology and other intellectual

property is difficult and expensive, and litigation may be necessary in the future to enforce their intellectual property rights.

litigation could result in substantial costs and diversion of our resources and could disrupt our business, as well as materially adversely

affect our financial condition and results of operations.

Further, despite the potentially substantial costs, we cannot assure you that

we will prevail in such litigation.

In addition, our trade secrets may be leaked or otherwise become available to, or be independently

discovered by, our competitors.

Any failure in protecting or enforcing our intellectual property rights could have a material adverse

effect on our business, financial condition, and results of operations.

parties may claim that we infringe their proprietary intellectual property rights, which could cause us to incur significant legal expenses

and prevent us from promoting our services.

cannot be certain that our operations or any aspects of our business do not or will not infringe upon or otherwise violate trademarks,

copyrights, patents, or other intellectual property rights held by third parties.

We may from time to time in the future be subject to

legal proceedings and claims relating to the intellectual property rights of others.

For instance, we may face claims of trademark or

copyright infringement for the use of images, pictures, or materials used on our website, in promotional materials, such as brochures

or videos, or in the distribution and storage of digital content.

There could also be existing intellectual property of which we are

not aware that our services may inadvertently infringe.

If any third-party infringement claims are brought against us, we may be forced

to divert management’s time and other resources from our business and operations to defend against these claims, regardless of

their merits.

Additionally, the application and interpretation of intellectual property right laws and the procedures and standards for

granting trademarks, copyrights, or other intellectual property rights are evolving and may be uncertain, and we cannot assure you that

courts or regulatory authorities would agree with our analysis.

Such claims, even if they do not result in liability, may harm our reputation.

If we were found to have violated the intellectual property rights of others, we may be subject to liability for our infringement activities

or may be prohibited from using such intellectual property, and we may incur licensing fees or be forced to develop alternatives of our

As a result, our business and financial performance may be materially and adversely affected.

may from time to time be subject to claims, controversies, lawsuits, and legal proceedings, which could adversely affect our business,

prospects, results of operations, and financial condition.

time to time, we may be involved in various claims, controversies, lawsuits, legal proceedings, or regulatory inquiries that arise in

the ordinary course of business involving labor and employment, wage and hour, intellectual property, data breach and other matters.

We expect that the number and significance of these potential disputes or claims may increase as our business expands and our company

grows larger.

Contractual provisions and insurance coverage may not cover potential claims and may not be adequate to indemnify us for

all liabilities we may face.

Any claims against us, whether meritorious or not, could be time consuming, result in costly litigation,

require significant amounts of management time, and result in the diversion of significant operational resources.

Litigation is inherently

unpredictable, and the results of any claims may have a material adverse effect on our business, financial condition, results of operations,

and prospects.

In addition, negative publicity regarding claims or judgments made against our Company may damage our reputation and may

result in a material adverse impact on us.

are subject to various U.S.

anti-corruption laws, and any failure to comply with such laws, and any laws to which we may become subject,

whether in existence now or hereafter, could harm our business, financial condition, and results of operations.

are subject to various U.S.

anti-corruption laws, such as the U.S.

Foreign Corrupt Practices Act of 1977, as amended (the “FCPA”),

as well as other similar anti-bribery and anti-kickback laws and regulations.

These laws and regulations generally prohibit companies

and their employees and intermediaries, from directly or indirectly authorizing, offering, or providing improper payments or benefits

to government officials and other recipients for improper purposes.

The FCPA also requires public companies to make and keep books and

records that accurately and fairly reflect the transactions of the corporation and to devise and maintain an adequate system of internal

accounting controls.

We anticipate that our exposure for violating these laws will increase as we continue to expand our presence, and

any failure to comply with such laws could harm our business, financial condition, and results of operations.

Relating to Our Capital Stock and Trading

price of our common stock could be subject to rapid and substantial volatility.

have been instances of extreme stock price run-ups followed by rapid price declines and strong stock price volatility with recent initial

public offerings, especially among those with relatively smaller public floats.

As a relatively small-capitalization company with a relatively

small public float, we may experience greater stock price volatility, extreme price run-ups, lower trading volume, and less liquidity

than large-capitalization companies.

In particular, our common stock may be subject to rapid and substantial price volatility, low volumes

of trades, and large spreads in bid and ask prices.

Such volatility, including any stock run-ups, may be unrelated to our actual or expected

operating performance and financial condition or prospects, making it difficult for prospective investors to assess the rapidly changing

value of our common stock.

addition, if the trading volumes of our common stock are low, persons buying or selling in relatively small quantities may easily influence

the price of our common stock.

This low volume of trades could also cause the price of our common stock to fluctuate greatly, with large

percentage changes in price occurring in any trading day session.

Holders of our common stock may also not be able to readily liquidate

their investment or may be forced to sell at depressed prices due to low volume trading.

Broad market fluctuations and general economic

and political conditions may also adversely affect the market price of our common stock.

As a result of this volatility, investors may

experience losses on their investment in our common stock.

A decline in the market price of our common stock also could adversely affect

our ability to issue additional shares of common stock or other of our securities and our ability to obtain additional financing in the

No assurance can be given that an active market in our common stock will develop or be sustained.

If an active market does not

develop, holders of our common stock may be unable to readily sell the shares of common stock they hold or may not be able to sell at

issuing preferred stock, we may be able to delay, defer or prevent a change of control.

certificate of incorporation permits us to issue, without approval from our stockholders, a total of 1,000,000 shares of preferred stock,

none of which are outstanding.

Our board of directors can determine the designations, powers, preferences and voting and other rights,

and the qualifications, limitations and restrictions granted to, or imposed upon, the shares of preferred stock and to fix the number

of shares constituting any series and the designation of such series.

It is possible that our board of directors, in determining the

rights, preferences and privileges to be granted when the preferred stock is issued, may include provisions that have the effect of delaying,

deferring or preventing a change in control, discouraging bids for our common stock at a premium over the market price, or that adversely

affect the market price of and the voting and other rights of the holders of our common stock.

Anti-takeover

provisions in our articles of incorporation and bylaws and under Nevada law could prevent or delay an acquisition of us, which may be

beneficial to our stockholders, and may prevent attempts by our stockholders to replace or remove our current management.

of the Nevada Revised Statutes, our articles of incorporation, as amended, and our bylaws, as amended, could make it more difficult to

acquire us by means of a tender offer, a proxy contest or otherwise, or to remove incumbent officers and directors.

These provisions,

which are summarized below, may have the effect of discouraging takeover bids.

require super-majority

voting to amend some provisions in our articles of incorporation and bylaws;

authorize the issuance

of “blank check” preferred stock that our board of directors could use to implement a stockholder rights plan;

eliminate the ability of

our stockholders to call special meetings of stockholders;

prohibit cumulative voting;

establish advance notice

requirements for nominations for election to our board of directors or for proposing matters that can be acted upon by stockholders

at stockholder meetings.

addition, Nevada Revised Statutes imposes certain restrictions on business combinations and certain changes or potential changes in control

of a Nevada corporation.

Anti-takeover provisions in our articles of incorporation and bylaws and under Nevada law could prevent or delay

an acquisition of us, which may be beneficial to our stockholders, and may prevent attempts by our stockholders to replace or remove

our current management.

articles of incorporation designate the Supreme Court of the State of Nevada as the exclusive forum for certain types of actions and

proceedings, which could limit a stockholder’s ability to choose the judicial forum for disputes with the Company or its directors,

officers or employees.

articles of incorporation provide that, to the fullest extent permitted by law, the Supreme Court of the State of Nevada will be the

exclusive forum for any derivative action or proceeding brought on our behalf;

any action asserting a breach of fiduciary duty;

asserting a claim arising pursuant to the Nevada Revised Statutes, our articles of incorporation or our bylaws;

or any action asserting

a claim governed by the internal affairs doctrine.

is uncertainty as to whether a court will enforce these forum selection clauses.

The choice of forum provision may limit a stockholder’s

ability to bring a claim in a judicial forum that it finds favorable for disputes, which may discourage such lawsuits.

We interpret the

forum selection clauses in our articles of incorporation to be limited to the specified actions and not to apply to actions arising under

the Exchange Act or the Securities Act.

Section 27 of the Exchange Act provides that United States federal courts shall have jurisdiction

over all suits and any action brought to enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder

and Section 22 of the Securities Act provides that United States federal and state courts shall have concurrent jurisdiction over all

suits brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder.

a court were to find the choice of forum provision contained in our articles of incorporation to be inapplicable or unenforceable in

an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could have a material adverse

effect on our business, financial condition, and results of operations.

we fail to implement and maintain an effective system of internal controls, we may fail to meet our reporting obligations or be unable

to accurately report our results of operations or prevent fraud, and investor confidence and the market price of our common stock may

be materially and adversely affected.

failure to implement and maintain an effective system of internal controls could result in inaccuracies in our financial statements and

could also impair our ability to comply with applicable financial reporting requirements and related regulatory filings on a timely basis.

As a result, our business, financial condition, results of operations, and prospects, as well as the trading price of our common stock,

may be materially and adversely affected.

Moreover, ineffective internal control over financial reporting significantly hinders our ability

to prevent fraud.

are a public company in the United States subject to the Sarbanes-Oxley Act of 2002.

Section 404 of the Sarbanes-Oxley Act of 2002 will

require that we include a report of management on our internal control over financial reporting in our annual report on 10-K beginning

with our annual report for the fiscal year ending December 31, 2025.

In addition, once we cease to be an “emerging growth company,”

as such term is defined in the JOBS Act, our independent registered public accounting firm must attest to and report on the effectiveness

of our internal control over financial reporting.

Our management may conclude that our internal control over financial reporting is not

Moreover, even if our management concludes that our internal control over financial reporting is effective, our independent

registered public accounting firm, after conducting its own independent testing, may issue a report that is qualified, if it is not satisfied

with our internal controls or the level at which our controls are documented, designed, operated, or reviewed, or if it interprets the

relevant requirements differently from us.

In addition, after we become a public company, our reporting obligations may place a significant

strain on our management, operational, and financial resources and systems for the foreseeable future.

We may be unable to complete our

evaluation testing and any required remediation in a timely manner.

bear substantial increased costs as a result of being a public company.

completed our initial offering in 2025 and have started bearing significant legal, accounting, and other expenses as a public company

that we did not incur as a private company since then.

These additional costs could negatively affect our financial results.

The Sarbanes-Oxley

Act of 2002, as well as rules subsequently implemented by the SEC and Nasdaq, impose various requirements on the corporate governance

practices of public companies.

with these laws, rules, and regulations increases our legal and financial compliance costs and makes some corporate activities more time-consuming

and costlier.

These laws, regulations, and standards are subject to varying interpretations and, as a result, their application in practice

may evolve over time as new guidance is provided by regulatory and governing bodies.

We intend to invest resources to comply with evolving

laws, regulations, and standards, and this investment may result in increased general and administrative expenses and a diversion of

management’s time and attention from revenue-generating activities to compliance activities.

In addition, we will incur additional

costs associated with our public company reporting requirements.

It may also be more difficult for us to find qualified persons to serve

on our board of directors or as executive officers.

are an “emerging growth company,” as defined in the JOBS Act and will remain an emerging growth company until the earlier

of (1) the last day of the fiscal year (a) following the fifth anniversary of the completion of our initial public offering, (b) in which

we have total annual gross revenue of at least $1.235 billion, or (c) in which we are a large accelerated filer, which means the market

value of our common stock that is held by non-affiliates exceeds $700 million as of the prior December 31, and (2) the date on which

we have issued more than $1.0 billion in non-convertible debt during the prior three-year period.

An emerging growth company may take

advantage of specified reduced reporting and other requirements that are otherwise applicable generally to public companies.

These provisions

include exemption from the auditor attestation requirement under Section 404 in the assessment of the emerging growth company’s

internal control over financial reporting and permission to delay adopting new or revised accounting standards until such time as those

standards apply to private companies.

we are no longer an “emerging growth company,” or until five years following the completion of our initial public offering,

whichever is earlier, we expect to incur significant additional expenses and devote substantial management effort toward ensuring compliance

with the requirements of Section 404 and the other rules and regulations of the SEC.

For example, as a public company, we have been required

to increase the number of independent directors and adopt policies regarding internal controls and disclosure controls and procedures.

are currently evaluating and monitoring developments with respect to these rules and regulations, and we cannot predict or estimate with

any degree of certainty the amount of additional costs we may incur or the timing of such costs.

may not be able to maintain the listing of our common stock on Nasdaq.

can be no assurance that we will be able to maintain the listing standards of Nasdaq, the exchange on which our common stock is traded,

which includes requirements that we maintain our stockholders’ equity, total value of shares of common stock held by unaffiliated

stockholders, minimum bid price, and market capitalization above certain specified levels.

we fail to conform to the Nasdaq listing requirements on an ongoing basis, our common stock might cease to trade on Nasdaq, and may move

to the OTCQB or OTC Pink Markets operated by OTC Markets Group, Inc.

These quotation services are generally considered to be markets

that are less efficient and that provide less liquidity in the shares of common stock than Nasdaq.

equity offerings or other equity issuances of us could further dilute common stock.

may in the future issue additional shares of our common stock or other securities convertible into or exchangeable for shares of our

common stock.

These issuances may occur at times or on terms that could be disadvantageous to our existing stockholders.

Our stockholders’

percentage ownership and voting power may be diluted, and they may experience a reduction in the value of their investment.

Additionally,

such issuances, if substantial, could negatively affect the market price of our common stock.

securities or industry analysts do not publish research or reports about our business, or if they publish a negative report regarding

our common stock, the price of our common stock and trading volume could decline.

trading market for our common stock may depend in part on the research and reports that industry or securities analysts publish about

us or our business.

We do not have any control over these analysts.

If one or more of the analysts who cover us downgrade us, the price

of our common stock would likely decline.

If one or more of these analysts cease coverage of our Company or fail to regularly publish

reports on us, we could lose visibility in the financial markets, which could cause the price of our common stock and the trading volume

are a “controlled company” within the meaning of the Nasdaq listing rules, and follow certain exemptions from certain corporate

governance requirements that could adversely affect our public stockholders.

of the date of this quarterly report, our largest stockholder, V-Cube, Inc., directly and indirectly owns more than a majority of the

voting power of our outstanding common stock and is able to determine all matters requiring approval by our stockholders.

is a Japanese company listed on the Tokyo Stock Exchange and its chief executive officer, Naoaki Mashita, has served as our Director

since February 2024 and is our minority stockholder.

Under the Nasdaq listing rules, a company of which more than 50% of the voting power

is held by an individual, group, or another company is a “controlled company” and is permitted to phase in its compliance

with the independent committee requirements.

We rely on the “controlled company” exemptions under the Nasdaq listing rules.

Specifically, we have not formed the nominating and corporate governance and compensation committees, and a majority of our board of

directors does not consist of independent directors, as permitted by the “controlled company” exemptions under the Nasdaq

listing rules.

While we have an audit committee, it presently consists of only one non-independent director, due to the recent resignations

of two independent directors.

We have undertaken a search for independent directors to fill the vacancies on our audit committee and

plan to have an audit committee comprised solely of independent directors within one year of the completion of our initial public offering,

in accordance with Nasdaq Listing Rules.

the period we remain a controlled company and during any transition period following a time when we are no longer a controlled company,

you will not have the same protections afforded to stockholders of companies that are subject to all of the corporate governance requirements

If, however, we lose our status as a controlled company in the future, we intend to establish nominating and corporate governance

and compensation committees to comply with the Nasdaq Listing Rules.

are an “emerging growth company” and a “smaller reporting company” under the JOBS Act, and we cannot be certain

if the reduced disclosure requirements applicable to emerging growth companies and smaller reporting companies will make our common stock

less attractive to investors.

are an “emerging growth company” and a “smaller reporting company” as defined in the JOBS Act, and we may take

advantage of certain exemptions from various reporting requirements that are applicable to other public companies that are not “emerging

growth companies” and “smaller reporting companies” including, but not limited to, not being required to comply with

the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, reduced disclosure obligations regarding executive compensation

in our periodic reports and proxy statements, and exemptions from the requirements of holding a nonbinding advisory vote on executive

compensation and stockholder approval of any golden parachute payments not previously approved.

addition, Section 107 of the JOBS Act also provides that an “emerging growth company” can take advantage of the extended

transition period provided in Section 7(a)(2)(B) of the Securities Act for complying with new or revised accounting standards.

words, an “emerging growth company” can delay the adoption of certain accounting standards until those standards would otherwise

apply to private companies.

We have elected to take advantage of the extended transition period for complying with new or revised accounting

will remain an “emerging growth company” until the last day of the fiscal year following the fifth anniversary of the date

of the first sale of our common stock pursuant to an effective registration statement under the Securities Act, although we will lose

that status sooner if our revenue exceeds $1.235 billion, if we issue more than $1 billion in non-convertible debt in a three-year period,

or if the market value of our common stock that is held by non-affiliates exceeds $700 million as of the last day of our most recently

completed second fiscal quarter.

may continue to be a smaller reporting company even after we are no longer an emerging growth company.

We may take advantage of certain

of the scaled disclosures available to smaller reporting companies and will be able to take advantage of these scaled disclosures for

so long as (i) the market value of our common stock held by non-affiliates is equal to or less than $250 million as of the last business

day of the most recently completed second fiscal quarter, or (ii) our annual revenue is equal to or less than $100 million during the

most recently completed fiscal year and the market value of our common stock held by non-affiliates is equal to or less than $700 million

as of the last business day of the most recently completed second fiscal quarter.

cannot predict if investors will find our common stock less attractive because we may rely on these exemptions.

If some investors find

our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may

be more volatile.

In addition, taking advantage of reduced disclosure obligations may make comparison of our financial statements with

other public companies difficult or impossible.

If investors are unable to compare our business with other companies in our industry,

we may not be able to raise additional capital as and when we need it, which may materially and adversely affect our financial condition

and results of operations.

of the date of this Quarterly Report on Form 10-Q, there have been no material changes to the risk factors disclosed in our Annual Report

on Form 10-K filed with the SEC on March 28, 2025, except that we have identified the additional risk factors set forth below.

currently have a substantial number of shares of common stock subject to potential issuance associated with our Equity Line of Credit

(“ELOC”) with Lincoln Park Capital Fund, LLC (“Lincoln Park”).

The issuance or sale of shares under our ELOC

would substantially increase the number of shares outstanding and result in dilution to our security holders.

This might substantially

decrease the market price of our common stock.

have a substantial number of shares of our common stock that may be issued in the future.

On June 23, 2025, we entered into a purchase

agreement (the “Purchase Agreement”) with Lincoln Park, pursuant to which Lincoln Park committed to purchase from us, from

time to time and subject to certain limitations and conditions, up to an aggregate of $20,000,000 of our common stock over the 24-month

term of the Purchase Agreement.

On that date, we issued Lincoln Park 882,145 shares of our common stock.

During the three months ended

September 30, 2025, we issued an additional 1,520,609 shares of our common stock to Lincoln Park under our ELOC.

To the extent that shares

of common stock are issued or sold under our ELOC, dilution to our security holders may occur.

The issuance of these additional securities

may have an adverse effect on the market price of our securities.

to comply with The Nasdaq Capital Market continued listing requirements may result in our common stock being delisted from The Nasdaq

Capital Market.

June 30, 2025, we received a deficiency letter (the “Notice”) from the Listing Qualifications Department of Nasdaq indicating

that, based upon the closing bid price of our common stock for 30 consecutive business days prior to the delivery of the Notice, we are

not in compliance with the bid price requirement, as set forth in Nasdaq Listing Rule 5550(a)(2) (the “Bid Price Requirement”).

We were provided a compliance period of 180 calendar days from the date of the Notice, or until December 29, 2025, to regain compliance

with the Bid Price Requirement, pursuant to Nasdaq Listing Rule 5810(c)(3)(A).

will continue to monitor the closing bid price of our common stock and seek to regain compliance with all applicable Nasdaq requirements

within the allotted compliance periods and may, if appropriate, consider available options, including implementation of a reverse stock

split of our common stock, to regain compliance with the Bid Price Requirement.

As previously disclosed in the preliminary information

statement filed on Schedule 14C filed on October 30, 2025, our stockholders have authorized our Board to implement a reverse stock split

in the range of 1-for-10 to 1-for-20.

If we seek to implement a reverse stock split in order to remain listed on Nasdaq, the announcement

or implementation of such a reverse stock split could negatively affect the price of our common stock.

If we do not regain compliance

within the allotted compliance periods, including any extensions that may be granted by Nasdaq, Nasdaq will provide notice that our common

stock will be subject to delisting.

We would then be entitled to appeal that determination to a Nasdaq hearings panel.

There can be no

assurance that we will regain compliance with the Bid Price Requirement during the 180-day compliance period or maintain compliance with

the other Nasdaq listing requirements.

A delisting could substantially decrease trading in our common stock, adversely affect the market

liquidity of our common stock as a result of the loss of market efficiencies associated with Nasdaq and the loss of federal preemption

of state securities laws, adversely affect our ability to obtain financing on acceptable terms, if at all, and may result in the potential

loss of confidence by investors, suppliers, customers and employees and fewer business development opportunities.

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-Q

Item 1A. Risk Factors