What changed in this filing

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Item 1A. Risk Factors

2023-05-17 compared with 2021-08-06 · 1304 added, 610 removed, 230 unchanged (89% of the section changed)

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financial condition and operating results.

The following discussion of risks is not all-inclusive but is designed to highlight what

we believe are the material factors to consider when evaluating our business and expectations.

The following discussion of risks is not all-inclusive but is designed to highlight what we

believe are the material factors to consider when evaluating our business and expectations.

These factors could cause our future results

to differ materially from our historical results and from expectations reflected in forward-looking statements.

Related to Our Business

business is sensitive to consumer spending and general economic conditions.

purchases of discretionary premium sporting good items, which include all of our products, may be adversely affected by the current COVID-19

(“Coronavirus”) pandemic, as well as economic conditions such as employment levels, wage and salary levels, trends in

consumer confidence and spending, reductions in consumer net worth, interest rates, inflation, the availability of consumer credit and

taxation policies influence on public spending confidence.

Recent dramatic downturns in the strength of global stock markets, currencies

and key economies have highlighted many if not all, of these risks.

purchases in general may decline during recessions, periods of prolonged declines in the equity markets or housing markets and periods

when disposable income and perceptions of consumer wealth are lower, and these risks may be exacerbated for us due to our focus on discretionary

premium sporting good items.

A downturn in the global economy, or in a regional economy in which we have significant sales, could

have a material, adverse effect on consumer purchases of our products, our results of operations and our financial position, and a downturn

adversely affecting our consumer base or travelers could have a disproportionate impact on our business.

continues to be a significant and growing volatility and uncertainty in the global economy due to the Coronavirus pandemic affecting

all business sectors and industries.

In addition, the on-going uncertainty in Europe (including concerns that certain European countries

may default in payments due on their national debt and concerns regarding the future viability of the European Union and the possible

effects of its unraveling) and any resulting disruption could adversely impact our net sales in Europe and globally unless and until

economic conditions in that region improve and the prospects of national debt defaults in Europe decline.

Further or future downturns

may adversely affect traffic at our on-line sales portals (which currently includes our own website www.slingerbag.com ) and could

materially and adversely affect our results of operations, financial position and growth strategy.

the current impasse in U.S.-China trade relations has resulted in import duties for all Slinger products into the U.S.

being increased from the previous standard of 5% to 30%.

Our management has taken the view that at this time in the early years

of Slinger’s growth, gaining distribution and share outweighs the immediate margin consideration and has decided to take

the added increase in import tariffs as a margin loss.

manufacturing takes place in China and, therefore, is susceptible to shutdowns and delays caused by Coronavirus and other diseases and

Additionally, we rely on independent manufacturers and suppliers.

at the date hereof, our sole manufacturing facilities are located in southern China.

Following the outbreak of the Coronavirus our manufacturing

facility was shut down for three months, which caused significant delays in manufacturing and delivery of our products.

However, there

may be further outbreaks of Coronavirus and other diseases and epidemics, which may cause further delays and shutdowns.

This, in turn,

will negatively affect our revenue and increase our expenses and costs.

do not control our independent manufacturers and suppliers or their labor and other business practices.

Violations of labor, environmental

or other laws by an independent manufacturer or supplier, or divergence of an independent manufacturer’s or supplier’s labor

or other practices from those generally accepted as ethical or appropriate in the U.S., could disrupt the shipments of our products or

draw negative publicity for us, thereby diminishing the value of our brand, reducing demand for our products and adversely affecting

our net income.

Additionally, since we do not manufacture our products, we are subject to risks associated with inventory and product

quality-control.

we have not historically entered into manufacturing contracts with our manufacturers;

instead, we have hired them on an ad hoc

Identifying a suitable manufacturer is an involved process that requires us to become satisfied with the prospective manufacturer’s

quality control, responsiveness and service capabilities, financial stability and labor practices.

While we have business continuity

and contingency plans for alternative sourcing, we may be unable, in the event of a significant disruption in our sourcing, to locate

alternative manufacturers or suppliers of comparable quality at an acceptable price, or at all, which could result in product shortages

or decreases in product quality, and adversely affect our net sales, gross margin, net income, customer relationships and our reputation.

depend on the strength of the Slinger®

expect to derive substantially all of our net sales from sales of Slinger branded products.

The reputation and integrity of the Slinger

brand are essential to the success of our business.

We believe that our consumers value the status and reputation of the Slinger brand,

and the superior quality, performance, functionality and durability that our brand represents.

Building, maintaining and enhancing the

status and reputation of the Slinger brand image is important to expanding our consumer base.

Our continued success and growth

depend on our ability to protect and promote the Slinger brand, which, in turn, depends on factors such as the quality, performance,

functionality and durability of our products, our communication activities, including advertising and public relations, and our management

of the consumer experience, including direct interfaces through customer service and warranty repairs.

We may decide to make substantial

investments in these areas in order to maintain and enhance our brand, and such investments may not be successful.

Related to Our Business, Operations, and Industry

depend on the strength of our brands.

expect to derive substantially all of our net sales from sales of branded products and services we own, including Slinger and

Gameface, and those we have agreements to license technology, including PlaySight and Foundation Sports.

The reputation and integrity of our

brands are essential to the success of our business.

We believe that our consumers value the status and reputation of brands we

promote, and the superior quality, performance, functionality and durability that our brands represent.

Building, maintaining and

enhancing the status and reputation of our brands’ image is important to expanding our consumer base.

Our continued success

and growth depend on our ability to protect and promote our brands, which, in turn, depends on factors such as the quality,

performance, functionality and durability of our products and services, our communication activities, including advertising and

public relations, and our management of the consumer experience, including direct interfaces through customer service and warranty

We may decide to make substantial investments in these areas in order to maintain and enhance our brand, and such

investments may not be successful.

Additionally,

in order to expand our reach in the future, we may need to engage with third-party distributors.

To the extent those third-party distributors

fail to comply with our operating guidelines, we may not be successful in protecting our brand image.

Product defects, product recalls,

counterfeit products and ineffective marketing are among the potential threats to the strength of our brand and to protect our brand’s

status we may need to make substantial expenditures to mitigate the impact of such threats.

if we fail to continue to innovate to ensure that our products are

deemed to achieve superior levels of function, quality and design, or to otherwise be sufficiently distinguishable from our competitors’

products, or if we fail to manage the growth of our on-line sales in a way that protects the high-end nature of our brand, the value

of the Slinger brand may be diluted, and we may not be able to maintain our premium position and pricing or sales volumes, which could

adversely affect our financial performance and business.

We believe that maintaining and enhancing our brand image in new markets

where we have limited brand recognition is important to expanding our consumer base.

If we are unable to maintain or enhance our brand

in new markets, then our growth strategy could be adversely affected.

in order to expand our reach, we engage with third-party distributors.

To the extent those third-party distributors fail to comply with

our operating guidelines, we may not be successful in protecting our brand image.

Product defects, product recalls, counterfeit products

and ineffective marketing are among the potential threats to the strength of our brands and to protect our brands’ status we may

need to make substantial expenditures to mitigate the impact of such threats.

if we fail to continue to innovate to ensure that our products are deemed to achieve superior levels of function, quality and design,

or to otherwise be sufficiently distinguishable from our competitors’ products, or if we fail to manage the growth of our on-line

sales in a way that protects the high-end nature of our brands, the value of our brands may be diluted, and we may not be able to maintain

our premium position and pricing or sales volumes, which could adversely affect our financial performance and business.

We believe that

maintaining and enhancing our brands image in new markets where we have limited brand recognition is important to expanding our consumer

If we are unable to maintain or enhance our brands in new markets, then our growth strategy could be adversely affected.

cost of raw materials, labor or freight could lead to an increase in our cost of sales and cause our results of operations to suffer .

costs for raw materials, labor or freight could make our sourcing processes more costly and negatively affect our gross margin and profitability.

Labor costs at our independent manufacturers’

sites have been increasing and it is unlikely that these increases will abate.

Labor costs at our independent manufacturers’ sites have been increasing and it is unlikely that these increases will abate.

and price inflation in our source countries could cause unanticipated price increases, which may be significant.

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If we attempt to pass the increases on to consumers, our sales may be adversely affected.

to adequately protect our intellectual property and curb the sale of counterfeit merchandise could injure our brand and negatively

affect our sales.

trademarks, copyrights, patents, designs and other intellectual property rights are important to our success and our competitive position.

We devote significant resources to the registration and protection of our trademarks and patents.

In spite of our efforts, counterfeiting

and design copies may still occur.

If we are unsuccessful in challenging the usurpation of these rights by third parties, this

could adversely affect our future sales, financial condition and results of operations.

Our efforts to enforce our intellectual property

rights can potentially be met with defenses and counterclaims attacking the validity and enforceability of our intellectual property

Unplanned increases in legal fees and other costs associated with protecting our intellectual property rights could result in

higher operating expenses.

Additionally, legal regimes outside the U.S., particularly those in Asia, including China, may not

always protect intellectual property rights to the same degree as U.S.

laws, or the time required to enforce our intellectual property

rights under these legal regimes may be lengthy and delay our recovery.

may become subject to claims for remuneration or royalties for assigned service invention rights by our employees, which could result

in litigation and adversely affect our business.

significant portion of our intellectual property has been developed by our employees, or outside consultants in the course of their employment

or retention with us.

Under the Israeli Patent Law, 5727-1967, or the Patent Law, inventions conceived by an employee during the scope

of his or her employment with a company are regarded as “service inventions.”

The Israeli Compensation and Royalties Committee,

or the Committee, a body constituted under the Patent Law, has previously held, in certain cases, that employees may be entitled to remuneration

for service inventions that they develop during their service for a company despite their explicit waiver of such right.

Therefore, although

we enter into agreements with all of our employees pursuant to which they waive their right to special remuneration for service inventions

created in the scope of their employment or engagement and agree that any such inventions are owned exclusively by us, we may face claims

by employees demanding remuneration beyond their regular salary and benefits.

international operations involve inherent risks which could result in harm to our business.

of our equipment is manufactured outside of the U.S.

with a large volume of our products being also sold outside of the U.S.

we are subject to the risks generally associated with global trade and doing business abroad, which include foreign laws and regulations,

varying consumer preferences across geographic regions, political unrest, disruptions or delays in cross-border shipments and changes

in economic conditions in countries in which our products are manufactured or where we sell products.

This includes, for example, the

uncertainty surrounding the effect of Brexit, including changes to the legal and regulatory framework that apply to the United Kingdom

and its relationship with the European Union, as well as new and proposed changes affecting tax laws and trade policy in the U.S.

elsewhere as further described in other risks in this section.

presidential administration has indicated a focus on policy reforms

that discourage U.S.

corporations from outsourcing manufacturing and production activities to foreign jurisdictions, including through

tariffs or penalties on goods manufactured outside the U.S., which may require us to change the way we conduct business and adversely

affect our results of operations.

develop products in Israel and our chief marketing officer is located in Israel and, therefore, our business, financial condition and

results of operation may be adversely affected by political, economic and military instability in Israel.

A portion of our operations, including product development, is based in Israel.

Our research and development is conducted through

our Israeli subsidiary and our chief marketing officer and chief innovation officer are both located in Israel.

Accordingly, political, economic and military conditions

in Israel directly affect our business.

economic and military conditions in Israel may directly affect our business.

Since the establishment of the State of Israel in 1948,

a number of armed conflicts have taken place between Israel and its neighboring countries, and between Israel and the Hamas and Hezbollah

extremist groups.

In addition, several countries, principally in the Middle East, restrict doing business with Israel, and additional

countries may impose restrictions on doing business with Israel and Israeli companies whether as a result of hostilities in the region

or otherwise.

Any hostilities involving Israel, terrorist activities, political instability or violence in the region or the interruption

or curtailment of trade or transport between Israel and its trading partners could adversely affect our operations and results of operations

and adversely affect the market price of our shares.

commercial insurance does not cover losses that may occur as a result of an event associated with the security situation in the Middle

Although the Israeli government is currently committed to covering the reinstatement value of direct damages that are caused by

terrorist attacks or acts of war, there can be no assurance that this government coverage will be maintained, or if maintained, will

be sufficient to compensate us fully for damages incurred.

Any losses or damages incurred by us could have a material adverse effect

on our business, financial condition and results of operations.

our operations could be disrupted by the obligations of our employees to perform military service.

Our chief marketing officer is subject

to the obligation to perform reserve military duty.

In response to increased tension and hostilities in the region, there have been,

at times, call-ups of military reservists, and it is possible that there will be additional call-ups in the future.

Our operations could

be disrupted by the absence of these employees due to military service.

Such disruption could harm our business and operating results.

uprisings in various countries in the Middle East and North Africa are affecting the political stability of those countries.

Such instability

may lead to deterioration in the political and trade relationships that exist between the State of Israel and these countries.

several countries, principally in the Middle East, restrict doing business with Israel and companies with an Israeli presence, and additional

countries may impose restrictions on doing business with Israel and Israeli companies if hostilities in the region continue or intensify.

Such restrictions may seriously limit our ability to sell our products to customers in those countries.

manufacturing takes place in China and is susceptible to shutdowns and delays caused by the Coronavirus and other diseases and epidemics.

Additionally, we rely on independent manufacturers and suppliers.

at the date hereof, one of our manufacturing facilities is located in southern China.

Following the outbreak of the Coronavirus our manufacturing

facility was shut down for three months, which caused some unforeseen delays in manufacturing and delivery of our products.

However, there

may be further outbreaks of the Coronavirus and other diseases and epidemics, which may cause further delays and shutdowns.

in turn, will negatively affect our revenue and increase our expenses and costs.

do not control our independent manufacturers and suppliers or their labor and other business practices.

Violations of labor, environmental

or other laws by an independent manufacturer or supplier, or divergence of an independent manufacturer’s or supplier’s labor

or other practices from those generally accepted as ethical or appropriate in the U.S., could disrupt the shipments of our products or

draw negative publicity for us, thereby diminishing the value of our brand, reducing demand for our products and adversely affecting

our net income.

Additionally, since we do not manufacture our products, we are subject to risks associated with inventory and product

quality-control.

we have not historically entered into manufacturing contracts with our manufacturers;

instead, we have hired them on an ad hoc basis.

Identifying a suitable manufacturer is an involved process that requires us to become satisfied with the prospective manufacturer’s

quality control, responsiveness and service capabilities, financial stability and labor practices.

While we have business continuity

and contingency plans for alternative sourcing, we may be unable, in the event of a significant disruption in our sourcing, to locate

alternative manufacturers or suppliers of comparable quality at an acceptable price, or at all, which could result in product shortages

or decreases in product quality, and adversely affect our net sales, gross margin, net income, customer relationships and our reputation.

rely heavily on supply chain reliability and predictability and continued disruption in our supply chain could have a material adverse

impact on operations.

rely heavily on supply chain reliability and predictability in producing, transporting and delivering our products.

pandemic, Ukraine war, inflationary trends, shifts in consumer purchasing patterns, availability of transport, labor shortages in

the shipping, trucking, and warehousing industries, port strikes, infrastructure congestion, equipment shortages and other factors

have all contributed to delivery delays, greater costs and uncertainty in arranging and scheduling transport of our products.

are unable to reliably and consistently arrange shipment and storage of our products, we may be unable to ship, deliver and store

our products in which case, we will have to reverse sales and issue refunds to purchasers of our products.

Changes in U.S.

international trade policies, including to import tariffs and trade policies and agreements, to address supply chain issues or

otherwise could also have a significant impact on our activities both in the United States and internationally.

disruptions, both domestic and international, have adversely impacted our operations.

Continued disruptions in our supply chain and

adverse consequences from aggressive trade policies could have a material adverse impact on our profitability and financial

face risks associated with operating in international markets.

operate in a global marketplace and international sales growth is a key element of our growth strategy.

We are subject to risks

associated with our international operations, including, but not limited to:

currency exchange rates, including GBP;

We are subject to risks associated

with our international operations, including, but not limited to:

currency exchange rates;

or governmental instability in foreign markets in which we operate or in those countries from which we source our merchandise;

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our international operations are conducted in parts of the world that experience corruption to some degree.

Although we have policies

and procedures in place that are designed to promote legal and regulatory compliance (including with respect to the U.S.

Foreign Corrupt

Practices Act and the United Kingdom Bribery Act 2010), our employees and wholesalers could take actions that violate applicable anti-corruption

laws or regulations.

Violations of these laws, or allegations of such violations, could have an adverse impact on our reputation, our

results of operations or our financial position.

exchange movements may also negatively affect the relative purchasing power of foreign tourists and result in declines in travel volumes

or their willingness to purchase discretionary premium goods, such as our products, while traveling, which would adversely affect our

We do not currently use the derivative markets to hedge foreign currency fluctuations.

results of operations are subject to seasonal and quarterly fluctuations, which could adversely affect the market price of our common

quarterly results of operations may fluctuate significantly as a result of a variety of factors, including, but not limited to:

in the number of our points of distribution;

in our merchandise mix;

timing of new product introductions.

growth of our business depends on the successful execution of our growth strategy, including our efforts to expand internationally by

growing our e-commerce business.

current growth strategy depends on our ability to continue to expand geographically in a number of international regions including Asia,

Europe, North America, China, Japan, South Korea, Middle East, India, South Africa and Australia.

This growth strategy is

contingent upon our ability to continually introduce our products to new markets.

The implementation of higher tariffs, quotas or other

restrictive trade policies in any international regions in which we seek to operate could adversely affect our ability to commence new

international operations, which could have an adverse impact on our growth strategy.

Further, consumer demand behavior, as well as tastes

and purchasing trends, may differ in various countries and, as a result, sales of our products may not be, or may take time to become,

successful, and gross margins on those net sales may not be in line with what we currently experience.

Our ability to execute our international

growth strategy, especially where we are not yet established, depends on our ability to understand regional market demographics,

and we may not be able to do so.

If we are unable to expand our business internationally, our growth strategy and our financial

results could be materially adversely affected.

Our employees and wholesalers

could take actions that violate applicable anti-corruption laws or regulations.

Violations of these laws, or allegations of such violations,

could have an adverse impact on our reputation, our results of operations or our financial position.

exchange movements may also negatively affect the relative purchasing power of consumers and their willingness to purchase discretionary

premium goods, such as our products, which would adversely affect our net sales.

We do not currently use the derivative markets to hedge

foreign currency fluctuations.

growth of our business depends on the successful execution of our growth strategy, and our efforts to expand internationally by growing our e-commerce business.

We are focused on developing

an integrated Play and Learn platform under our Connexa brand.

The Platform will bring together our owned offerings of Gameface AI and

Slinger Bag, and incorporate elements of our licensed offering of PlaySight and Foundation Sports, under the umbrella of the Connexa brand.

We believe our success will in large part depend on our ability to develop a cohesive platform that integrates elements of performance

analysis from each.

We may face difficulties integrating the technology and offerings from each brand in order create a cohesive business.

For example, users of the Slinger Bag may view us a sporting goods company and choose not to engage with our technology offerings from

the Gameface AI brand, and users of our Gameface AI app services may not purchase our ball launchers.

current growth strategy depends on our ability to continue to expand our reach geographically in a number of international regions

in Asia, Europe, North America, Africa and Australia.

This growth strategy is contingent upon our ability to continually introduce

our products to new markets.

The implementation of higher tariffs, quotas or other restrictive trade policies in any international

regions in which we seek to operate could adversely affect our ability to commence new international operations, which could have an

adverse impact on our growth strategy.

Further, consumer demand behavior, as well as tastes and purchasing trends, may differ in

various countries and, as a result, sales of our products may not be, or may take time to become, successful, and gross margins on

those net sales may not be in line with what we currently experience.

Our ability to execute our international growth strategy,

especially where we are not yet established, depends on our ability to understand regional market demographics, and we may not be

able to do so.

If we are unable to develop the

integrated Play and Learn platform and expand our business internationally, our growth strategy and our financial results could be materially

adversely affected.

we are unable to respond effectively to changes in market trends and consumer preferences, our market share, net sales and profitability

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aesthetics and economic circumstances.

We believe that our success in developing products that are innovative and that meet our consumers’

functional needs is an important factor in our image as a premium brand, and in our ability to charge premium prices.

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may be unable to appeal to new consumers while maintaining the loyalty of our core consumers.

of our growth strategy is to introduce new consumers, including younger consumers, to the Slinger brand.

If we are unable to attract

new consumers, including younger consumers, our business and results of operations may be adversely affected as our core consumers’

age increases and levels of travel and purchasing frequency decrease.

Initiatives and strategies intended to position our brand to appeal

to new and younger consumers may not appeal to our core consumers and may diminish the appeal of our brand to our core consumers, resulting

in reduced core consumer loyalty.

If we are unable to successfully appeal to new and younger consumers while maintaining our brand’s

premium image with our core consumers, then our net sales and our brand image may be adversely affected.

in our tax obligations and effective tax rate may have a negative effect on our operating results.

may be subject to income taxes in multiple jurisdictions.

We record tax expense based on our estimates of future payments, which include

reserves for uncertain tax provisions in multiple tax jurisdictions.

At any one time, many tax years may be subject to audit by various

taxing jurisdictions.

The results of these audits and negotiations with taxing authorities may affect the ultimate settlement of these

As a result, we expect that throughout the year there could be ongoing variability in our quarterly tax rates as events occur

and exposures are evaluated.

Further, our effective tax rate in a given financial period may be materially impacted by changes in mix

and level of earnings or by changes to existing accounting rules or regulations.

In addition, tax legislation enacted in the future could

negatively impact our current or future tax structure and effective tax rates.

of our growth strategy is to introduce new consumers, including young consumers, to the Connexa brand.

If we are unable to attract new

consumers, including young consumers, our business and results of operations may be adversely affected as our core consumers’ age

increases and purchasing frequency decrease.

Initiatives and strategies intended to position our brand to appeal to new and young consumers

may not appeal to our core consumers and may diminish the appeal of our brand to our core consumers, resulting in reduced core consumer

If we are unable to successfully appeal to new and young consumers while maintaining our brand’s image with our core consumers,

then our net sales and our brand image may be adversely affected.

business could suffer if we are unable to maintain our website or manage our inventory effectively.

employ a distribution strategy that is heavily dependent upon our website and third-party distributors’

e-commerce websites.

employ a distribution strategy that is heavily dependent upon our website and third-party distributors’ e- commerce websites.

effectiveness of our e-commerce strategy depends on our ability to manage our inventory and our distribution processes effectively so

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public company.

If our business does not generate cash flow from operating activities sufficient to fund these activities, and if sufficient

funds are not otherwise available to us, we will need to seek additional capital, through debt or equity financings, to fund our growth.

Conditions in the credit markets (such as availability of finance and fluctuations in interest rates) may make it difficult for us to

obtain such financing on attractive terms or even at all.

Additional debt financing that we may undertake, may be expensive and might

impose on us covenants that restrict our operations and strategic initiatives, including limitations on our ability to incur liens or

additional debt, pay dividends, repurchase our capital stock, make investments and engage in merger, consolidation and asset sale transactions.

Equity financings may be on terms that are dilutive or potentially dilutive to our shareholders, and the prices at which new investors

would be willing to purchase our equity securities may be lower than the price per share of our common stock.

Operating cash flows were weak earlier this year and, as a result, we had to significantly curtail operations and dispose

of our PlaySight and Foundation Sports operations.

Business—Recent Developments” for more information.

If our business does not generate cash flow from operating activities sufficient to fund these activities, and if sufficient funds are

not otherwise available to us, we will need to seek additional capital, through debt or equity financings, to fund our growth.

in the credit markets (such as availability of finance and fluctuations in interest rates) may make it difficult for us to obtain such

financing on attractive terms or even at all.

Additional debt financing that we may undertake, may be expensive and might impose on us

covenants that restrict our operations and strategic initiatives, including limitations on our ability to incur liens or additional debt,

pay dividends, repurchase our capital stock, make investments and engage in merger, consolidation and asset sale transactions.

financings may be on terms that are dilutive or potentially dilutive to our shareholders, and the prices at which new investors would

be willing to purchase our equity securities may be lower than the price per share of our common stock.

The holders of new securities

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rely heavily on manufacturers in Asia, which requires long lead times to get goods to markets.

The long lead times will require

us to carry extra inventory to avoid out-of-stock scenarios.

The long lead times will require us to

carry extra inventory to avoid out-of-stock scenarios.

In the event of a decline in demand for our products, due to general economic

conditions or other factors, we may be forced to liquidate this extra inventory at lower margins or at a loss.

In addition, as

a result of these long lead times, design decisions are required to be made several months or as early as a year and a half before the

goods are delivered.

Consumers’

In addition, consumers’

tastes can change between the time a product is designed and the time it takes to get to market.

If the designs are not popular with consumers, it could also result in the need to liquidate the inventories at lower margins

or at a loss, which would adversely affect our results of operations.

If the designs are not popular with

consumers, it could also result in the need to liquidate the inventories at lower margins or at a loss, which would adversely affect

our results of operations.

depend on existing members of management and key employees to implement key elements in our strategy for growth, and the failure to retain

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For instance, our chief executive officer has extensive experience

running branded sporting goods as well as retail-oriented businesses.

running branded sporting goods.

The loss of any key member of our management team or other key

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Further, if we are unable to attract appropriately

qualified new personnel as we expand over the next few years, we may not be successful in implementing our growth strategy.

qualified new personnel, including a chief financial officer, we may not be successful in implementing our growth strategy.

instance, our profitability and financial performance could be adversely affected.

applicable employment laws, we may not be able to enforce covenants not to compete.

generally enter into non-competition agreements as part of our employment agreements with our employees.

These agreements generally prohibit

our employees, if they cease working for us, from competing directly with us or working for our competitors or clients for a limited

We may be unable to enforce these agreements under the laws of the jurisdictions in which our employees work and it may be difficult

for us to restrict our competitors from benefitting from the expertise our former employees or consultants developed while working for

example, some labor courts have required employers seeking to enforce non-compete undertakings of a former employee to demonstrate that

the competitive activities of the former employee will harm one of a limited number of material interests of the employer, which

have been recognized by the courts as justification for the enforcement of non-compete undertakings, such as the protection of a company’s

trade secrets or other intellectual property.

do not employ traditional advertising channels, and if we fail to adequately market our brand through product introductions and other

means of promotion, our business could be adversely affected.

marketing strategy depends on our ability to promote our brand’s message by using online advertising and social media to promote

new product introductions in a cost-effective manner and possibly from time to time the use of newspapers and magazines.

We do not employ

traditional advertising channels such as billboards, television and radio.

If our marketing efforts are not successful at attracting

new consumers and increasing purchasing frequency by our existing consumers, there may be no cost-effective marketing channels available

to us for the promotion of our brand.

If we increase our spending on advertising, or initiate spending on traditional advertising, our

expenses will rise, and our advertising efforts may not be successful.

In addition, if we are unable to successfully and cost-effectively

employ advertising channels to promote our brand to new consumers and new markets, our growth strategy may be adversely affected.

to protect confidential information of our consumers and our network against security breaches or failure to comply with privacy and

security laws and regulations could damage our reputation, brand and business.

significant challenge to e-commerce and communications, including the operation of our website, is the secure transmission of confidential

information over public networks.

Our failure to prevent security breaches could damage our reputation and brand and substantially harm

our business and results of operations.

On our website, a majority of the sales are billed to our consumers’

credit card accounts

directly, orders are shipped to a consumer’s address, and consumers log on using their email address.

In such transactions, maintaining

complete security for the transmission of confidential information on our website, such as consumers’

credit card numbers and expiration

dates, personal information and billing addresses, is essential to maintaining consumer confidence.

In addition, we hold certain private

information about our consumers, such as their names, addresses, phone numbers and browsing and purchasing records.

We rely on encryption

and authentication technology licensed from third parties to effect the secure transmission of confidential information, including credit

card numbers.

Advances in computer capabilities, new discoveries in the field of cryptography or other developments may result in a compromise

or breach of the technology used by us to protect consumer transaction data.

In addition, any party who is able to illicitly obtain a

user’s password could potentially access the user’s transaction data or personal information.

We may not be able to prevent

third parties, such as hackers or criminal organizations, from stealing information provided by our consumers to us through our website.

In addition, our third-party merchants and delivery service providers may violate their confidentiality obligations and disclose information

about our consumers.

Any compromise of our security or material violation of a non-disclosure obligation could damage our reputation

and brand and expose us to a risk of loss or litigation and possible liability, which could substantially harm our business and

results of operations.

In addition, anyone who is able to circumvent our security measures could misappropriate proprietary information

or cause interruptions in our operations.

as long as we are an “emerging growth company,”

we will not be required to comply with certain reporting requirements that

apply to other publicly reporting companies.

We cannot predict whether the reduced disclosure requirements applicable to emerging growth

companies will make our common shares less attractive to investors.

are an “emerging growth company,”

as defined in the JOBS Act.

For as long as we continue to be an emerging growth company,

we may choose to take advantage of certain exemptions from reporting requirements applicable to other publicly reporting companies that

are not emerging growth companies.

These include:

(i) not being required to comply with the auditor attestation requirements for the

assessment of our internal controls over financial reporting provided by Section 404 of the Sarbanes-Oxley Act of 2002, or the

Sarbanes-Oxley Act, (ii) not being required to comply with any requirements adopted by the PCAOB requiring mandatory audit firm rotation

or a supplement to the auditor’s report in which the auditor would be required to provide additional information about the audit

and the financial statements of the issuer, (iii) not being required to comply with any new audit rules adopted by the PCAOB after April

5, 2012 unless the SEC determines otherwise, (iv) not being required to provide certain disclosure regarding executive compensation required

of larger publicly reporting companies, and (v) not being required to hold a non-binding advisory vote on executive compensation or seek

shareholder approval of any golden parachute payments not previously approved.

We could be an emerging growth company for up to five

years from the end of our current fiscal year, although, if the market value of our common shares that is held by non-affiliates

exceeds $700 million as of any October 31 before the end of that five-year period, we would cease to be an emerging growth company

as of the following April 30.

We cannot predict if investors will find our common shares less attractive if we choose to

rely on these exemptions.

If some investors find our common shares less attractive as a result of any choices to reduce future

disclosure, there may be a less active trading market for our shares and our share price may be more volatile.

Further, as a result of

these scaled regulatory requirements, our disclosure may be more limited than that of other publicly reporting companies and you may

not have the same protections afforded to shareholders of such companies.

product development company and chief marketing officer are located in Israel and, therefore, our business, financial condition and results

of operation may be adversely affected by political, economic and military instability in Israel.

operate our Slinger business in Israel under Slinger Bag Ltd.

We have also engaged an Israeli product development company to assist in

the development of our current and future products and our chief marketing officer resides in Israel.

Accordingly, political, economic

and military conditions in Israel directly affect our business.

economic and military conditions in Israel may directly affect our business.

Since the establishment of the State of Israel in 1948,

a number of armed conflicts have taken place between Israel and its neighboring countries, Hamas and Hezbollah.

In addition, several

countries, principally in the Middle East, restrict doing business with Israel, and additional countries may impose restrictions on doing

business with Israel and Israeli companies whether as a result of hostilities in the region or otherwise.

Any hostilities involving Israel,

terrorist activities, political instability or violence in the region or the interruption or curtailment of trade or transport between

Israel and its trading partners could adversely affect our operations and results of operations and adversely affect the market price

of our shares.

commercial insurance does not cover losses that may occur as a result of an event associated with the security situation in the Middle

Although the Israeli government is currently committed to covering the reinstatement value of direct damages that are caused by

terrorist attacks or acts of war, there can be no assurance that this government coverage will be maintained, or if maintained, will

be sufficient to compensate us fully for damages incurred.

Any losses or damages incurred by us could have a material adverse effect

on our business, financial condition and results of operations.

our operations could be disrupted by the obligations of our employees to perform military service.

Our chief marketing officer is subject

to the obligation to perform reserve military duty.

In response to increased tension and hostilities in the region, there have been,

at times, call-ups of military reservists, and it is possible that there will be additional call-ups in the future.

Our operations could

be disrupted by the absence of these employees due to military service.

Such disruption could harm our business and operating results.

uprisings in various countries in the Middle East and North Africa are affecting the political stability of those countries.

Such instability

may lead to deterioration in the political and trade relationships that exist between the State of Israel and these countries.

several countries, principally in the Middle East, restrict doing business with Israel and companies with an Israeli presence, and additional

countries may impose restrictions on doing business with Israel and Israeli companies if hostilities in the region continue or intensify.

Such restrictions may seriously limit our ability to sell our products to customers in those countries.

Related to Ownership of Our Shares

is currently limited liquidity of shares of our common stock.

of our common stock do not trade on a regular basis.

Failure to develop or maintain a trading market could negatively affect its value

and make it difficult or impossible for you to sell your shares.

Even if a market for common stock does develop, the market price of

common stock may be highly volatile.

In addition to the uncertainties relating to future operating performance and the profitability

of operations, factors such as variations in interim financial results or various, as yet unpredictable, factors, many of which are beyond

our control, may have a negative effect on the market price of our common stock.

The liquidity of the shares of our common stock may

also be affected adversely by a reverse stock split given the reduced number of shares that will be outstanding following a reverse stock

split, especially if the market price of our common stock does not increase as a result of the reverse stock split.

stock price may be volatile, or may decline regardless of our operating performance, and you could lose all or part of your investment

should consider an investment in our common shares to be risky, and you should invest in our common shares only if you

can withstand a significant loss and wide fluctuation in the market value of your investment.

The market price of our common shares

could be subject to significant fluctuations in response to the factors described in this section and other factors, many of which are

beyond our control.

Among the factors that could affect our stock price are:

or anticipated variations in our quarterly and annual operating results or those of companies perceived to be similar to us;

conditions, particularly during holiday shopping periods;

in expectations as to our future financial performance, including financial estimates by securities analysts and investors, or differences

between our actual results and those expected by investors and securities analysts;

in the market valuations of companies perceived by investors to be comparable to us;

public’s response to our or our competitors’

filings with the SEC or announcements regarding new products or services,

enhancements, significant contracts, acquisitions, strategic investments, litigation, restructurings or other significant matters;

about our business in the press or the investment community;

sales of our shares;

by our competitors;

or departures of members of our senior management or other key personnel;

passage of legislation or other regulatory developments affecting us or our industry.

addition, the securities markets have experienced significant price and volume fluctuations that have affected and continue to affect

market price of equity securities of many companies.

These fluctuations have often been unrelated or disproportionate to the operating

performance of particular companies.

These broad market fluctuations, as well as general economic, systemic, political and market conditions,

such as recessions, loss of investor confidence, interest rate changes, or international currency fluctuations, may negatively affect

the market price of our shares.

any of the foregoing occurs, it could cause our stock price to fall and may expose us to securities class action litigation that, even

if unsuccessful, could be costly to defend and a distraction to management.

trading market for our common shares will be influenced by the research and reports that equity research analysts publish about

us and our business.

The price of our common shares could decline if one or more securities analysts downgrade our common

shares or if those analysts issue a sell recommendation or other unfavorable commentary or cease publishing reports about us or our business.

If one or more of the analysts who elect to cover us downgrade our common shares, our share price could decline rapidly.

or more of these analysts cease coverage of us, we could lose visibility in the market, which in turn could cause our common share

price and trading volume to decline.

do not intend to pay dividends on our common shares.

intend to retain all of our earnings, if any, for the foreseeable future to finance the operation and expansion of our business and do

not anticipate paying cash dividends.

Any future determination to pay dividends will be at the discretion of our board of directors,

subject to compliance with applicable law and any contractual provisions, and will depend on, among other factors, our results of operations,

financial condition, capital requirements and other factors that our board of directors deems relevant.

As a result, you should expect

to receive a return on your investment in our common shares only if the market price of the common shares increases, which

may never occur.

sales, or the perception of future sales, of our common stock may depress the price of our common stock.

of July 31, 2021, we have 29,979,573 outstanding common shares.

Of these shares, 6,562,001 shares are in the public float or are eligible for re-sale under Rule 144.

All remaining common

shares outstanding are “restricted securities”

within the meaning of Rule 144.

Additional sales of our common shares in the

public market after the date hereof, or the perception that these sales could occur, could cause the market price of our common shares

relating to our business

marketing strategy depends on our ability to promote our brand’s message by using online advertising and social media, and possibly

the use of newspapers and magazines to promote new product introductions in a cost-effective manner.

We do not employ traditional advertising

channels such as billboards, television and radio.

If our marketing efforts are not successful at attracting new consumers and increasing

purchasing frequency by our existing consumers, there may be no cost-effective marketing channels available to us for the promotion of

If we increase our spending on advertising, or initiate spending on traditional advertising, our expenses will rise, and our

advertising efforts may not be successful.

In addition, if we are unable to successfully and cost-effectively employ advertising channels

to promote our brand to new consumers and new markets, our growth strategy may be adversely affected.

rely significantly on information technology to operate our business.

Any significant security breach of our confidential information

of our customers, applications, technology, networks, or other systems critical to our operations, or failure to comply with privacy

and security laws and regulations could damage our reputation, brands and business.

We are heavily dependent on information

technology systems and networks, including the Internet and third-party services (“Information Technology Systems”), across

our supply chain, including product design, production, forecasting, ordering, manufacturing, transportation, sales and distribution,

as well as for processing financial information for external and internal reporting purposes, operations and other business activities.

Information Technology Systems are critical to many of our operating activities and our business processes and they may be negatively

impacted by any service interruption or shutdown.

For example, our ability to effectively manage and maintain our inventory and to ship

products to customers on a timely basis depends significantly on the reliability of these Information Technology Systems.

third party systems provider to manage all our company data and transactions, record our financial transactions and manage our operations.

The failure of these systems to operate effectively, including as a result of security breaches, viruses, hackers, malware, natural disasters,

vendor business interruptions or other causes, or failure to properly maintain, protect, repair or upgrade systems, or problems with transitioning

to upgraded or replacement systems could cause delays in product fulfillment and reduced efficiency of our operations, could require additional

capital to remediate the problem which may not be sufficient to cover all eventualities, and may have an adverse effect on our reputation,

results of operations and financial condition.

also use Information Technology Systems to process financial information and results of operations for internal reporting purposes and

to comply with regulatory financial reporting, legal and tax requirements.

If Information Technology Systems suffer severe damage, disruption

or shutdown and our business continuity plans, or those of our vendors, do not effectively resolve the issues in a timely manner, we

could experience delays in reporting our financial results, which could result in lost revenues and profits, as well as reputational

Furthermore, we depend on Information Technology Systems and personal data collection for digital marketing, digital commerce,

consumer engagement and the marketing and use of our digital products and services.

We also rely on our ability to engage in electronic

communications throughout the world between and among our employees as well as with other third parties, including customers, suppliers,

vendors and consumers.

Any interruption in Information Technology Systems may impede our ability to engage in the digital space and result

in lost revenues, damage to our reputation, and loss of users.

connection with various facets of our business, we collect and use a variety of personal data related to our customers.

Our failure to

prevent security breaches could damage our reputation and brands and substantially harm our business and results of operations.

website, a majority of the sales are billed to our consumers’ credit card accounts directly, orders are shipped to a consumer’s

address, and consumers log on using their email address.

In such transactions, maintaining complete security for the transmission of

confidential information on our website, such as consumers’ credit card numbers and expiration dates, personal information and

billing addresses is essential to maintaining consumer confidence.

In addition, we hold certain private information about our consumers,

such as their names, addresses, phone numbers and browsing and purchasing records.

We rely on encryption and authentication technology

licensed from third parties to effect the secure transmission of confidential information, including credit card numbers.

computer capabilities, new discoveries in the field of cryptography or other developments may result in a compromise or breach of the

technology used by us to protect consumer transaction data.

In addition, any party who is able to illicitly obtain a user’s password

could potentially access the user’s transaction data or personal information.

We may not be able to prevent third parties, such

as hackers or criminal organizations, from stealing information provided by our consumers to us through our website.

In addition, our

third-party merchants and delivery service providers may violate their confidentiality obligations and disclose information about our

Any compromise of our security or material violation of a non-disclosure obligation could damage our reputation and brand

and expose us to a risk of loss or litigation and possible liability, which could substantially harm our business and results of operations.

In addition, anyone who is able to circumvent our security measures could misappropriate proprietary information or cause interruptions

in our operations.

the platform and applications that we use to operate our business are highly technical and complex and may now or in the future

contain undetected errors, bugs, or vulnerabilities.

Some errors in our code may only be discovered after the code has been

Any errors, bugs or vulnerabilities discovered in our code after deployment, inability to identify the cause or causes of

performance problems within an acceptable period of time or difficultly maintaining and improving the performance of our platform,

particularly during peak usage times, could result in damage to our reputation or brand, loss of revenues, or liability for damages,

any of which could adversely affect our business and financial results.

To the extent that we do not effectively address capacity

constraints, upgrade our systems as needed and continually develop our technology and network architecture to accommodate actual and

anticipated changes in technology, our business and operating results may be harmed.

economic, political and industry conditions constantly change and unfavorable conditions may have a material adverse effect on our business

and results of operations.

are a global company with worldwide operations.

Volatile economic, political and market conditions, such as political or economic instability,

civil unrest, trade sanctions, acts of terrorism in the regions or hostilities, including the recent conflict between Russia and Ukraine,

in which we operate may have a negative impact on our operating results and our ability to achieve our business objectives.

have insight into economic and political trends that could emerge and negatively affect our business.

In addition, significant or volatile

changes in exchange rates between the U.S.

dollar and other currencies may have a material adverse impact upon our liquidity, revenues,

costs and operating results.

Additionally,

natural disasters and public health emergencies, such as extreme weather events and the COVID-19 pandemic and the Ukraine War, could have a significant

adverse effect on our business, including interruption of our business operations, supply chain disruption, endangerment of our

personnel, and other delays or losses of materials and results.

Russian-Ukrainian Conflict may adversely affect our business, financial condition and results.

February 2022, the Russian Federation and Belarus commenced a military action with the country of Ukraine.

The specific impact on our

financial condition, results of operations and cash flows is not determinable as of the date hereof.

However, to the extent that such

military action spreads to other countries, intensifies, or otherwise remains active, such action could have an impact on the broader

macroeconomic impact and therefore, could have a material adverse effect on our financial condition, results of operations, and cash

If the Russia-Ukraine conflict continues, the U.S., the European Union, the United Kingdom, and other jurisdictions could impose

wider economic and trade sanctions as well as export restrictions, which could impact our business opportunities.

In addition, our contractors

may take actions in violation of such policies and applicable law, and we could be held ultimately responsible.

If we are held responsible

for a violation of U.S.

or other countries’ sanctions laws, we may be subject to various penalties, any of which could have a material

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

products face intense competition.

is a consumer products company and the relative popularity of tennis and various sports and fitness activities and changing design trends

affect the demand for our products.

The athletic equipment industry is highly competitive both in the U.S.

We are a sports equipment and

technology company delivering products and technologies and the relative popularity of tennis, pickleball and Padel tennis and other various

sports activities and changing design trends affect the demand for our products.

The sports equipment industry and sports-related technology

industry are both are highly competitive both in the U.S.

and worldwide.

internationally with a significant number of athletic and sports equipment companies and large companies having diversified lines of

athletic and sports equipment.

We also compete with other companies for the production capacity of independent manufacturers that

produce our products.

Our online digital e-commerce operations compete with brand wholesalers or specialist retailers.

We compete internationally with a significant number of athletic

and sports equipment companies and sports-related technology companies, including sports-related technology companies, including large

companies having diversified lines of athletic and sports equipment and sports technology products.

We also compete with other companies

for the production capacity of independent manufacturers that produce our products.

Our online digital e-commerce operations compete with

brand wholesalers or specialist retailers.

offerings, technologies, marketing expenditures (including expenditures for advertising and endorsements), pricing, costs of production,

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respond to our competitors, our costs may increase or the consumer demand for our products may decline significantly.

AI-based technology market is new and unproven, and it may decline or experience limited growth, which would adversely affect our

ability to fully realize the potential of our platforms.

The AI-based technology market

is relatively new and evaluating the size and scope of the market is subject to a number of risks and uncertainties.

We believe that our

future success will depend in large part on the continued growth of this market.

The utilization of our app platform by users is untested,

and users may not recognize the need for, or benefits of, this app platform, which may prompt them to cease use of our platform or decide

to adopt alternative products and services to satisfy their cognitive computing search and analytics requirements.

In order to expand

our business and extend our market position, we intend to focus our marketing and sales efforts on educating users about the benefits

and technological capabilities of our platforms and the applications of our platform to the specific needs of customers in different market

Our ability to access and expand the market that our platform is designed to address depends upon a number of factors, including

the cost, performance and perceived value of our platforms.

Market opportunity estimates are subject to significant uncertainty and are

based on assumptions and estimates, including our internal analysis and industry experience.

The market for our platform may fail to grow

significantly or be unable to meet the level of growth we expect.

As a result, we may experience lower-than-expected demand for our products

and services due to lack of customer acceptance, technological challenges, competing products and services, decreases in spending by current

and prospective customers, weakening economic conditions and other causes.

If our market does not experience significant growth, or if

demand for our products does not increase in line with our projections, then our business, results of operations and financial condition

will be adversely affected.

rely on technical innovation and high-quality products to compete in the market for our products.

and development plays a key role in technical innovation.

We rely upon specialists in the fields of engineering, industrial design, sustainability

and related fields, as well as other experts to develop and test cutting-edge performance products.

While we strive to produce products

that help to enhance player performance, if we fail to introduce technical innovation in our products, consumer demand for our products

could decline, and if we experience problems with the quality of our products, we may incur substantial expense to remedy the problems.

We rely upon specialists in the fields of electrical and mechanical

engineering, industrial design, sustainability and related fields, as well as other experts to develop and test cutting-edge

performance products.

While we strive to produce products that help to enhance player performance, if we fail to introduce technical

innovation in our products, consumer demand for our products could decline, and if we experience problems with the quality of our

products, we may incur substantial expense to remedy the problems.

With the acquisition of Gameface and licensing

agreements with PlaySight and Foundation, we are slowly transforming from a sports products only company to offering an additional sports

technology platform focused on the Play & Learn Platform.

If we are unable to successfully integrate this new technology with our

existing products, we may not realize the benefits of the Gameface acquisition and / or our relationships with PlaySight and Foundation,

and our business may be materially adversely affected.

Prior to our acquisition of Gameface

and our licensing agreement with PlaySight, we focused on the production and sale of the Slinger Bag.

Now our focused has shifted to the

Play and Learn integrated platform which includes the analysis and AI offered by Gameface.

The Play and Learn Platform requires integration

of the capabilities of our existing business with those of Gameface.

we may not realize the benefits of the Gameface acquisition and our

business may be materially adversely affected.

to continue to obtain or maintain high-quality endorsers of our products could harm our business.

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increase our marketing investments.

As a result, our brands, net revenues, expenses and profitability could be harmed.

Furthermore, if

certain endorsers were to stop using our products contrary to their endorsement agreements, our business could be adversely affected.

In addition, actions taken by athletes or other endorsers, associated with our products that harm the reputations of those athletes or

endorsers, could also seriously harm our brand image with consumers and, as a result, could have an adverse effect on our sales and financial

In addition, poor performance by our endorsers, a failure to continue to correctly identify future athletes, public figures

or sports organizations, to use and endorse our products or a failure to enter into cost-effective endorsement arrangements with prominent

athletes, public figures, and sports organizations could adversely affect our brand, sales and profitability.

Any substantial deterioration in these relationships, or substantial deterioration of our relationship

with their talent managers or other key personnel, could adversely affect our business.

As a result, our brands, net revenues, expenses

and profitability could be harmed.

If certain endorsers were to stop using our products contrary to their endorsement agreements, our

business could be adversely affected.

taken by athletes or other endorsers, associated with our products that harm the reputations of those athletes or endorsers, could also

seriously harm our brand image with consumers and, as a result, could have an adverse effect on our sales and financial condition.

taken by athletes or other endorsers, associated with our products that harm the reputations of those athletes or endorsers, could also

seriously harm our brand image with consumers and, as a result, could have an adverse effect on our sales and financial condition.

performance by our endorsers, a failure to continue to correctly identify future athletes, public figures or sports organizations, to

use and endorse our products or a failure to enter into cost-effective endorsement arrangements with prominent athletes, public figures,

and sports organizations could adversely affect our brand, sales and profitability.

We are also subject to laws, regulations and industry

standards relating to endorsements and influencer marketing.

Many of these laws, regulations and industry standards are changing and

may be subject to differing interpretations, are costly to comply with or inconsistent among jurisdictions.

business may be affected by seasonality, which could result in fluctuations in our operating results.

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period to period.

This seasonality, along with other factors that are beyond our control, including general economic conditions, changes

in consumer preferences, weather conditions, availability of import quotas, transportation disruptions and currency exchange rate fluctuations,

could adversely affect our business and cause our results of operations to fluctuate.

Our operating margins are also sensitive to a number

of additional factors that are beyond our control, including manufacturing and transportation costs, shifts in product sales mix and

geographic sales trends, all of which we expect to continue.

Results of operations in any period should not be considered indicative

of the results to be expected for any future period.

may be adversely affected by the financial health of our customers.

extend credit to our tennis wholesale and tennis specialist retail customers based on an assessment of a customer’s financial condition,

generally without requiring collateral.

To assist in the scheduling of production and the shipping of our products, we offer our distributor

partners the opportunity to place orders three months ahead of delivery under our direct ship ordering program.

These advance orders

may be canceled under certain conditions, and the risk of cancellation may increase when dealing with financially unstable distribution

partners struggling with economic uncertainty.

In the past, some sports customers have experienced financial difficulties up to and including

bankruptcies.

Our operating margins are also sensitive to a number of additional factors that are beyond our control, including manufacturing

and transportation costs, shifts in product sales mix and geographic sales trends, all of which we expect to continue.

Results of operations

in any period should not be considered indicative of the results to be expected for any future period.

may be adversely affected by the financial health of our third-party internet partners, wholesale purchasers, retailers, and

distributors.

We extend credit to our distributors

and to a select number of third party internet partners based on an assessment of a customer’s financial condition, generally without

requiring collateral.

To assist in the scheduling of production and the shipping of our products, we offer our distributor partners the

opportunity to place orders three months ahead of delivery under our direct ship ordering program.

These advance orders may be canceled

under certain conditions, and the risk of cancellation may increase when dealing with financially unstable distribution partners struggling

with economic uncertainty.

In the past, some sports customers have experienced financial difficulties up to and including bankruptcies.

Such future events would have an adverse effect on our sales, our ability to collect on receivables and our financial condition.

When the retail economy weakens or as consumer behavior shifts, retailers may be more cautious with orders.

the retail economy weakens or as consumer behavior shifts, distributors may be more cautious with orders.

A slowing or changing economy

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of operations and financial condition.

In addition, product sales are dependent in part on high quality merchandising and an appealing

retail environment to attract consumers, which requires continuing investments by retailers.

Retailers that experience financial difficulties

may fail to make such investments or delay them, resulting in lower sales and orders for our products.

In addition, product sales are dependent in part on high quality digital advertising and merchandising

to attract consumers, which requires continuing investments by the company, our distributors and our third party internet partners.

or partners that experience financial difficulties may fail to make such investments or delay them, resulting in lower sales and orders

for our products.

to accurately forecast consumer demand could lead to excess inventories or inventory shortages, which could result in decreased operating

margins, reduced cash flows and harm to our business.

meet anticipated demand for our products, we purchase products from manufacturers outside of our direct ship ordering program and in

advance of customer orders, which we hold in inventory and resell to customers.

There is a risk we may be unable to sell excess products

ordered from manufacturers.

Inventory levels in excess of customer demand may result in inventory write-downs, and the sale of excess

inventory at discounted prices could significantly impair our brand image and have an adverse effect on our operating results, financial

condition and cash flows.

Conversely, if we underestimate consumer demand for our products or if our manufacturers fail to supply products

we require at the time we need them, we may experience inventory shortages.

Inventory shortages might delay shipments to customers, negatively

impact retailer, distributor and consumer relationships and diminish brand loyalty.

The difficulty in forecasting demand also makes it

difficult to estimate our future results of operations, financial condition and cash flows from period to period.

A failure to accurately

predict the level of demand for our products could adversely affect our net revenues and net income, and we are unlikely to forecast

such effects with any certainty in advance.

is a risk we may be unable to sell excess products ordered from manufacturers.

Inventory levels in excess of customer demand may result

in inventory write-downs, and the sale of excess inventory at discounted prices could significantly impair our brand image and have an

adverse effect on our operating results, financial condition and cash flows.

Conversely, if we underestimate consumer demand for our

products or if our manufacturers fail to supply products, we require at the time we need them, we may experience inventory shortages.

Inventory shortages might delay shipments to customers, negatively impact retailer, distributor and consumer relationships and diminish

brand loyalty.

The difficulty in forecasting demand also makes it difficult to estimate our future results of operations, financial condition

and cash flows from period to period.

A failure to accurately predict the level of demand for our products could adversely affect our

net revenues and net income, and we are unlikely to forecast such effects with any certainty in advance.

Consolidation

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adversely affect sales in our digital commerce business, as well as damage our reputation and brands.

factors unique to e-commerce operations, some of which are beyond our control, pose risks and uncertainties.

Risks include, but are not

limited to credit card fraud or data mismanagement.

are subject to data security and privacy risks that could negatively affect our results, operations or reputation.

addition to our own sensitive and proprietary business information, we handle transactional and personal information about our customers

and users of our digital experiences, which include online distribution channels and product engagement, adaptive products and personal

fitness applications.

Hackers and data thieves are increasingly sophisticated and operate social engineering, such as phishing, and large-scale,

complex automated attacks that can evade detection for long periods of time.

Any breach of our or our service providers’

or other vendor systems, may result in the loss of confidential business and financial data, misappropriation of our consumers’,

or employees’

personal information or a disruption of our business.

Any of these outcomes could have a material adverse

effect on our business, including unwanted media attention, impairment of our consumer and customer relationships, damage to our reputation;

resulting in lost sales and consumers, fines, lawsuits, or significant legal and remediation expenses.

We also may need to expend significant

resources to protect against, respond to and/or redress problems caused by any breach.

In addition, we must comply with increasingly

complex and rigorous regulatory standards enacted to protect business and personal data in the U.S., Europe and elsewhere.

of our contractors or our licensees’

contractors to comply with local laws and other standards could harm our business.

work with contractors outside of the U.S.

to manufacture our products.

We require the contractors that directly manufacture our

products and our licensees that make products using our intellectual property (including, indirectly, their contract manufacturers) to

comply with environmental, health and safety standards for the benefit of workers.

We also require these contractors to comply with applicable

standards for product safety.

Notwithstanding their contractual obligations, from time-to-time contractors may not comply with

such standards or applicable local law or our licensees may fail to enforce such standards or applicable local law on their contractors.

Significant or continuing noncompliance with such standards and laws by one or more contractors could harm our reputation or result in

a product recall and, as a result, could have an adverse effect on our sales and financial condition.

Negative publicity regarding production

methods, alleged practices or workplace or related conditions of any of our suppliers, manufacturers or licensees could adversely affect

our brand image and sales and force us to locate alternative suppliers, manufacturers or licenses.

international operations involve inherent risks which could result in harm to our business.

of our equipment is manufactured outside of the U.S.

with a large volume of our products being also sold outside of the U.S.

Accordingly, we are subject to the risks generally associated with global trade and doing business abroad, which include foreign

laws and regulations, varying consumer preferences across geographic regions, political unrest, disruptions or delays in cross-border

shipments and changes in economic conditions in countries in which our products are manufactured or where we sell products.

This includes,

for example, the uncertainty surrounding the effect of Brexit, including changes to the legal and regulatory framework that apply to

the United Kingdom and its relationship with the European Union, as well as new and proposed changes affecting tax laws and trade policy

and elsewhere as further described in other risks in this section.

presidential administration has indicated

a focus on policy reforms that discourage U.S.

corporations from outsourcing manufacturing and production activities to foreign jurisdictions,

including through tariffs or penalties on goods manufactured outside the U.S., which may require us to change the way we conduct business

and adversely affect our results of operations.

The administration has also targeted the specific practices of certain U.S.

multinational

corporations in public statements which, if directed at us, could harm our reputation or otherwise negatively impact our business.

could be subject to changes in tax rates, adoption of new tax laws, additional tax liabilities or increased volatility in our effective

are subject to the tax laws in the U.S.

and numerous foreign jurisdictions.

Current economic and political conditions make tax

laws and regulations, or their interpretation and application, in any jurisdiction subject to significant change.

On December 22, 2017,

enacted the Tax Cuts and Jobs Act (the “Tax Act”), which includes a number of significant changes to previous U.S.

tax laws that impact us, including provisions for a one-time transition tax on deemed repatriation of undistributed foreign earnings,

and a reduction in the corporate tax rate from 35% to 21% for tax years beginning after December 31, 2017, among other changes.

Act also transitions U.S.

international taxation from a worldwide system to a modified territorial system and includes base erosion prevention

measures on non-U.S.

earnings, which has the effect of subjecting certain earnings of our foreign subsidiaries to U.S.

earn a substantial portion of our income in foreign countries and are subject to the tax laws of those jurisdictions.

There have been

proposals to reform foreign tax laws that could significantly impact how U.S.

multinational corporations are taxed on foreign earnings.

Although we cannot predict whether or in what form these proposals will pass, several of the proposals considered, if enacted into law,

could have an adverse impact on our income tax expense and cash flows.

of our operations are subject to a reduced tax rate or are free of tax under various tax holidays and rulings.

We also utilize tax rulings

and other agreements to obtain certainty in treatment of certain tax matters.

These holidays and rulings expire in whole or in part from

time to time and may be extended when certain conditions are met or terminated if certain conditions are not met.

The impact of any changes

in conditions would be the loss of certainty in treatment thus potentially impacting our effective income tax rate.

may also be subject to the examination of our tax returns by the U.S.

Internal Revenue Service (“IRS”) and other tax

We regularly assess the likelihood of an adverse outcome resulting from these examinations to determine the adequacy of

our provision for income taxes.

Although we believe our tax provisions are adequate, the final determination of tax audits and any related

disputes could be materially different from our historical income tax provisions and accruals.

The results of audits or related disputes

could have an adverse effect on our financial statements for the period or periods for which the applicable final determinations are

For example, we and our subsidiaries are also engaged in a number of intercompany transactions across multiple tax jurisdictions.

Although we believe we have clearly reflected the economics of these transactions and the proper local transfer pricing documentation

is in place, tax authorities may propose and sustain adjustments that could result in changes that may impact our mix of earnings in

countries with differing statutory tax rates.

Many factors unique to e-commerce

operations, some of which are beyond our control, pose risks and uncertainties.

Risks include, but are not limited to, credit card fraud

or data mismanagement.

products are subject to risks associated with overseas sourcing, manufacturing and financing.

principal materials used in our products (e.g., injection molded plastics, polyester, electrical motors, remote controls) are available

principal materials used in our products (e.g., injection molded plastics, polyester, electrical motors, remote controls, trolley bags) are available

in countries where our manufacturing takes place.

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to locate, train, employ and retain adequate personnel.

Slinger contractors and suppliers buy raw materials and are subject to wage rates

Our contractors and suppliers buy raw materials and are subject to wage rates

that are oftentimes regulated by the governments of the countries in which our products are manufactured.

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adversely affect our results of operations.

rely significantly on information technology to operate our business, including our supply chain and retail operations, and any failure,

inadequacy or interruption of that technology could harm our ability to effectively operate our business.

are heavily dependent on information technology systems and networks, including the Internet and third-party services (“Information

Technology Systems”), across our supply chain, including product design, production, forecasting, ordering, manufacturing, transportation,

sales and distribution, as well as for processing financial information for external and internal reporting purposes, retail operations

and other business activities.

Information Technology Systems are critical to many of our operating activities and our business processes

and they may be negatively impacted by any service interruption or shutdown.

For example, our ability to effectively manage and maintain

our inventory and to ship products to customers on a timely basis depends significantly on the reliability of these Information Technology

We have implemented Information Technology Systems in all of the geographical regions in which we operate.

Our work to integrate,

secure and enhance these systems and related processes in our global operations is ongoing and Slinger will continue to invest in these

The failure of these systems to operate effectively, including as a result of security breaches, viruses, hackers, malware,

natural disasters, vendor business interruptions or other causes, or failure to properly maintain, protect, repair or upgrade systems,

or problems with transitioning to upgraded or replacement systems could cause delays in product fulfillment and reduced efficiency of

our operations, could require significant capital investments to remediate the problem which may not be sufficient to cover all eventualities,

and may have an adverse effect on our reputation, results of operations and financial condition.

also use Information Technology Systems to process financial information and results of operations for internal reporting purposes and

to comply with regulatory financial reporting, legal and tax requirements.

If Information Technology Systems suffer severe damage, disruption

or shutdown and our business continuity plans, or those of our vendors, do not effectively resolve the issues in a timely manner, we

could experience delays in reporting our financial results, which could result in lost revenues and profits, as well as reputational

Furthermore, we depend on Information Technology Systems and personal data collection for digital marketing, digital commerce,

consumer engagement and the marketing and use of our digital products and services.

We also rely on our ability to engage in electronic

communications throughout the world between and among our employees as well as with other third parties, including customers, suppliers,

vendors and consumers.

Any interruption in Information Technology Systems may impede our ability to engage in the digital space and result

in lost revenues, damage to our reputation, and loss of users.

financial results may be adversely affected if substantial investments in businesses and operations fail to produce expected returns.

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and divert management attention from more profitable business operations.

business is sensitive to consumer spending and general economic conditions.

Our business may be adversely

affected by the COVID-19 pandemic and the Ukraine war, as well as macro-economic conditions such as inflation, employment levels, wage

and salary levels, trends in consumer confidence and spending, reductions in consumer net worth, interest rates, inflation, the availability

of consumer credit and taxation policies influence on public spending confidence.

Recent dramatic downturns in the strength of global

stock markets, currencies and key economies have highlighted many if not all, of these risks.

purchases in general may decline during recessions, periods of prolonged declines in the equity markets or housing markets and periods

when disposable income and perceptions of consumer wealth are lower, and these risks may be exacerbated for us due to our focus on discretionary

premium sporting good items.

A downturn in the global economy, or in a regional economy in which we have significant sales, could have

a material, adverse effect on consumer purchases of our products, our results of operations and our financial position, and a downturn

adversely affecting our consumer base or travelers could have a disproportionate impact on our business.

continues to be a significant and growing volatility and uncertainty in the global economy due to the Coronavirus pandemic affecting

all business sectors and industries.

In addition, the on-going uncertainty in Europe and any resulting disruption could adversely impact

our net sales in Europe and globally unless and until economic conditions in that region improve and the prospects of national debt defaults

in Europe decline.

Further or future downturns may adversely affect traffic at our on-line sales portals (which currently includes our

own website https://www.connexasports.com/ and could materially and adversely affect our results of operations, financial position and

growth strategy.

the current impasse in U.S.-China trade relations has resulted in import duties for all Slinger products into the U.S.

being increased

from the previous standard of 5% to 30%.

Our management has taken the view that at this time, gaining distribution and share outweighs

the immediate margin consideration and has decided to take the added increase in import tariffs as a margin loss.

is substantial doubt regarding our ability to continue as a going concern absent obtaining adequate new debt or equity financing and

achieving sufficient sales levels.

Company’s management has determined that there is substantial doubt about the Company’s ability to continue as a going concern

and the report of our independent registered public accounting firm on our consolidated financial statements for the years ended April

30, 2022 and 2021 included an explanatory paragraph with respect to the foregoing.

Our ability to continue as a going concern is dependent

upon our ability to raise additional capital and implement our business plan.

This determination was based on the following factors:

(i) the Company has a working capital deficit as of April 30, 2022, used cash in operations for the fiscal year ended April 30, 2022

of $11,464,464 in 2022, and the Company’s available cash as of the date of this filing will not be sufficient to fund its anticipated level

of operations for the next 12 months;

(ii) the Company will require additional financing for the fiscal year ending April 30, 2023 to

continue at its expected level of operations;

and (iii) if the Company fails to obtain the needed capital, it will be forced to delay,

scale back, or eliminate some or all of its development activities or perhaps cease operations.

In the opinion of management, these factors,

among others, raise substantial doubt about the ability of the Company to continue as a going concern as of the date of the end of the

period covered by this report and for one year from the issuance of the consolidated financial statements.

have limited financial resources.

Our independent registered auditors’ report includes an explanatory paragraph stating that there

is substantial doubt about our ability to continue as a going concern.

a result of our deficiency in working capital on April 30, 2022 and other factors, our auditors have included a paragraph in their audit

report regarding substantial doubt about our ability to continue as a going concern.

Our plans in this regard are to increase product

sales, increase production, obtain inventory financing, seek strategic alternatives and to seek additional capital through future equity

private placements or debt facilities.

have recorded net losses since inception and have significant accumulated deficits.

We have relied upon loans and equity financings for

operating capital.

Total revenues will be insufficient to pay off existing debt and fund operations.

We may be required to rely on further

debt financing, further loans from related parties, and private placements of our common stock for our additional cash needs.

sources may not be available, or the terms of such funding sources may not be acceptable to the Company.

will need additional capital in the future to finance our planned growth, which we may not be able to raise or it may only be available

on terms unfavorable to us or our stockholders, which may result in our inability to fund our working capital requirements and harm our

operational results.

have and expect to continue to have substantial working capital needs.

Our cash on hand, together with cash generated from product sales,

services, cash equivalents and short-term investments will not meet our working capital and capital expenditure requirements for the

next twelve months.

In fact, we will be required to raise additional funds throughout 2023 or we will need to limit operations until

such time as we can raise substantial funds to meet our working capital needs.

In addition, we will need to raise additional funds to

fund our operations and implement our growth strategy, or to respond to competitive pressures and/or perceived opportunities, such as

investment, acquisition, marketing and development activities.

we experience operating difficulties or other factors, many of which may be beyond our control, cause our revenues or cash flows from

operations, if any, to decrease, we may be limited in our ability to spend the capital necessary to complete our development, marketing

and growth programs.

We require additional financing, in addition to anticipated cash generated from our operations, to fund our working

capital requirements.

Additional financing might not be available on terms favorable to us, or at all.

If adequate funds were not available

or were not available on acceptable terms, our ability to fund our operations, take advantage of unanticipated opportunities, develop

or enhance our business or otherwise respond to competitive pressures would be significantly limited.

In such a capital restricted situation,

we may curtail our marketing, development, and operational activities or be forced to sell some of our assets on an untimely or unfavorable

internal controls may be inadequate, which could cause our financial reporting to be unreliable and lead to misinformation being disseminated

to the public.

management is responsible for establishing and maintaining adequate internal control over our financial reporting.

As defined in Exchange

Act Rule 13a-15(f), internal control over financial reporting is a process designed by, or under the supervision of, the principal executive

and principal financial officer and effected by the board of directors of the Company (the “Board of Directors”), management

and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial

statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures

to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets

of the Company;

reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with

generally accepted accounting principles and that receipts and expenditures of the Company are being made only in accordance with

authorizations of management and/or directors of the Company;

reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company’s

assets that could have a material effect on the financial statements.

internal controls may be inadequate or ineffective, which could cause financial reporting to be unreliable and lead to misinformation

being disseminated to the public.

Investors relying upon this misinformation may make an uninformed investment decision.

to achieve and maintain an effective internal control environment could cause us to face regulatory action and also cause investors to

lose confidence in our reported financial information, either of which could have a material adverse effect on the Company’s business,

financial condition, results of operations and future prospects.

our auditors will not be required to formally attest to the effectiveness of our internal control over financial reporting pursuant to

Section 404 until we are no longer a “smaller reporting company”.

costs of being a public company could result in us being unable to continue as a going concern.

a public company, we are required to comply with numerous financial reporting and legal requirements, including those pertaining to audits

and internal control.

The costs of maintaining public company reporting requirements could be significant and may preclude us from seeking

financing or equity investment on terms acceptable to us and our shareholders.

We estimate these costs to be in excess of $250,000 per

year and may be higher if our business volume or business activity increases significantly.

Our current estimate of costs does not include

the necessary expenses associated with compliance, documentation and specific reporting requirements of Section 404 as we will not be

subject to the full reporting requirements of Section 404 until we no longer qualify as a “smaller reporting company”.

our revenues are insufficient or non-existent, and/or we cannot satisfy many of these costs through the issuance of shares or debt, we

may be unable to satisfy these costs in the normal course of business.

This would certainly result in our being unable to continue as

a going concern.

we fail to maintain effective internal controls over financial reporting, then the price of our common stock may be adversely affected.

internal control over financial reporting may have weaknesses and conditions that could require correction or remediation, the disclosure

of which may have an adverse impact on the price of our common stock.

We are required to establish and maintain appropriate internal

controls over financial reporting.

Failure to establish those controls, or any failure of those controls once established, could adversely

affect our public disclosures regarding our business, prospects, financial condition or results of operations.

In addition, management’s

assessment of internal controls over financial reporting may identify weaknesses and conditions that need to be addressed in our internal

controls over financial reporting or other matters that may raise concerns for investors.

Any actual or perceived weaknesses and conditions

that need to be addressed in our internal control over financial reporting or disclosure of management’s assessment of our internal

controls over financial reporting may have an adverse impact on the price of our common stock.

acquisitions we make could disrupt our business and seriously harm our financial condition.

have in the past made (and may, from time to time, consider) acquisitions of complementary companies, products or technologies.

component of our growth strategy has been to acquire complementary businesses to grow our Company.

For example, we acquired the business

of Foundation Sports Systems, LLC, in our fiscal year ended April 30, 2021, and the acquisitions of PlaySight and Gameface closed in

the fiscal year ended April 30, 2022.

We intend to continue to pursue acquisitions of complementary technologies, products and businesses

as a primary component of our growth strategy to enhance the features and functionality of our applications, expand our customer base

and provide access to new markets and increase benefits of scale.

Acquisitions involve numerous risks, including difficulties in the

assimilation of the acquired businesses, the diversion of our management’s attention from other business concerns and potential

adverse effects on existing business relationships could cause our actual growth or operating results to differ from our expectations.

In addition, any acquisitions could involve the incurrence of substantial additional indebtedness.

We cannot assure you that we will

be able to successfully integrate any acquisitions that we pursue or that such acquisitions will perform as planned or prove to be beneficial

to our operations and cash flow.

Any such failure could seriously harm our business, financial condition and results of operations.

addition, there might be potential inability or failure to achieve additional sales and enhance our customer base through cross-marketing

of the products to new and existing customers.

aspects of our business processes include open-source software, which poses risks that could have a material and adverse effect on our

business, financial condition and results of operations.

In addition, any failure to comply with the terms of one or more of these open-source

licenses could negatively affect our business.

incorporate open-source software into processes supporting our business and anticipate using open- source software in the future.

open-source software may include software covered by licenses like the GNU General Public License and the Apache License.

various open-source licenses to which we are subject have not been interpreted by U.S.

courts, and there is a risk that such licenses

could be construed in a manner that imposes unanticipated conditions or restrictions on our ability to operate our systems, limits our

use of the software, inhibits certain aspects of our systems and negatively affects our business operations.

open-source licenses contain requirements that we make source code modifications or derivative works we create publicly available or

make such modifications or derivative works available on unfavorable terms or at no cost, depending on the type of open-source software

we monitor our use of open-source software and try to ensure that none is used in a manner that would require us to disclose our proprietary

source code or that would otherwise breach the terms of an open-source license, such use could inadvertently occur, or could be claimed

to have occurred, in part because open-source license terms are often ambiguous.

We may face claims from third parties claiming ownership

of, or demanding the release or license of, modifications or derivative works that we have developed using such open-source software

(which could include our proprietary source code or artificial intelligence (“AI”) models), or otherwise seeking to enforce

the terms of the applicable open-source license.

These claims could result in litigation and if portions of our proprietary AI models

or software are determined to be subject to an open-source license, or if the license terms for the open-source software that we incorporate

change, we could be required to publicly release all or affected portions of our source code, purchase a costly license, cease offering

the implicated products or services unless and until we can re-engineer such source code in a manner that avoids infringement, discontinue

or delay the provision of our offerings if re-engineering could not be accomplished on a timely basis or change our business activities,

any of which could negatively affect our business operations and potentially our intellectual property rights.

In addition, the re-engineering

process could require us to expend significant additional research and development resources, and we may not be able to complete the

re-engineering process successfully.

If we were required to publicly disclose any portion of our proprietary models, it is possible we

could lose the benefit of trade secret protection for our models.

addition to risks related to license requirements, the use of certain open-source software can lead to greater risks than the use of

third-party commercial software, as open-source licensors generally do not provide support, warranties, indemnification, controls or

other contractual protections regarding infringement claims or the quality of the origin of the software.

There is little legal precedent

in this area, and any actual or claimed requirement to disclose our proprietary source code or pay damages for breach of contract could

harm our business and could help third parties, including our competitors, develop products and services that are similar to or better

Use of open-source software may also present additional security risks because the public availability of such software may

make it easier for hackers and other third parties to determine how to breach our website and systems that rely on open-source software.

Any of these risks associated with the use of open-source software could be difficult to eliminate or manage, and if not addressed, could

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

defects, failures or disruptions, including events beyond our control, and resulting interruptions in the availability of our websites,

applications, products, or services could harm our business, harm our reputation, result in significant costs to us, decrease our potential

profitability and expose us to substantial liability.

use vendors, such as our cloud computing web services provider and third-party software providers, in the operation of our platform.

The satisfactory performance, reliability and availability of our technology and our underlying network and infrastructure are critical

to our operations and reputation and the ability of our platform to attract new and retain existing customers.

We rely on these vendors

to protect their systems and facilities against damage or service interruptions from natural disasters, power or telecommunications failures,

air quality issues, environmental conditions, computer viruses or attempts to harm these systems, criminal acts, unauthorized access,

sabotage, acts of vandalism, military actions, negligence, human errors, fraud, spikes in platform use and denial of service issues,

hardware failures, improper operation, cyberattacks, data loss, wars and similar events.

If our arrangement with a vendor is terminated

or if there is a lapse of service or damage to its systems or facilities, we could experience interruptions in our ability to operate

our platform.

We also may experience increased costs and difficulties in replacing that vendor and replacement services may not be available

on commercially reasonable terms, on a timely basis, or at all.

addition, our platform may be accessed by many users at the same time.

As we continue to expand the number of our users, and products

and services available through our platform, we may not be able to scale our technology to accommodate the increased capacity requirements.

The failure of data centers, internet service providers or other third- party service providers to meet our capacity requirements could

result in interruptions or delays in access to our platform or impede our ability to grow our business and scale our operations.

interruptions or delays in our platform availability, whether as a result of a failure to perform on the part of a vendor, any damage

to one of our vendor’s systems or facilities, the termination of any of our third-party vendor agreements, software failures, our

or our vendor’s error, natural disasters, terrorism, other man-made problems, security breaches, whether accidental or willful,

or other factors, could harm our relationships with our customers, prevent our customers from accessing their accounts, damage our reputation

with current and potential customers, expose us to liability, cause us to lose customers, cause the loss of critical data, prevent us

from supporting our platform, products or services or cause us to incur additional expense in arranging for new facilities and support

or otherwise harm our business and also harm our reputation.

In addition, we source certain

information from third parties.

In the event that any third party from which we source information experiences a service disruption, whether

as a result of maintenance, natural disasters, terrorism, or security breaches, whether accidental or willful, or other factors, the ability

to access our platform may be adversely impacted.

Additionally, there may be errors contained in the information provided by third parties.

This may result in the inability to approve otherwise qualified applicants through our platform, which may adversely impact our business

by negatively impacting our reputation and reducing our transaction volume.

the extent we use or are dependent on any particular third-party data, technology, or software, we may also be harmed if such data, technology,

or software becomes non-compliant with existing regulations or industry standards, becomes subject to third-party claims of intellectual

property infringement, misappropriation, or other violation, or malfunctions or functions in a way we did not anticipate.

the right to use any of this data, technology, or software could result in delays in the provisioning of our products and services until

equivalent or replacement data, technology, or software is either developed by us, or, if available, is identified, obtained, and integrated,

and there is no guarantee that we would be successful in developing, identifying, obtaining, or integrating equivalent or similar data,

technology, or software, which could result in the loss or limiting of our products, services, or features available in our products

ability to sell our products and services will be dependent on the quality of our technical support and our failure to deliver high-quality

technical support services could have a material adverse effect on our sales and results of operations.

we do not effectively assist our users in deploying our products and services, succeed in helping our users quickly resolve post-deployment

issues and provide effective ongoing support, or if potential customers perceive that we may not be able to achieve the foregoing, our

ability to sell our products and services would be adversely affected, and our reputation with potential users could be harmed.

if we expand our operations internationally, our technical support team will face additional challenges, including those associated with

delivering support, training and documentation in languages other than the English language.

As a result, our failure to deliver and

maintain high-quality technical support services to our users could result in customers choosing to use our competitors’ products

or services in the future.

Gameface products and services may fail to keep pace with rapidly changing technology and evolving industry standards.

market in which Gameface operates is characterized by rapid, and sometimes disruptive, technological developments, evolving industry

standards, frequent new product introductions and enhancements and changes in user requirements.

In addition, both traditional and new

competitors are investing heavily in our market areas and competing for users.

As next-generation video analytics technology continues

to evolve, we must keep pace in order to maintain or expand our market position.

If we are not able to successfully add staff resources

with sufficient technical skills to develop and bring new products to market in a timely manner, achieve market acceptance of our products

and services or identify new market opportunities for our products and services, our business and results of operations may be materially

and adversely affected.

business-to-business e-commerce industry is highly competitive, and we may not be able to compete effectively.

market for business-to-business (“B2B”) e-commerce solutions is rapidly changing and intensely competitive.

We expect competition

to intensify as the number of entrants and new technologies increases.

We may not be able to compete successfully against current or

future competitors.

The competitive pressures facing us may harm our business, operating results and financial condition.

rely on third parties to develop cognitive engines for our platform and in some cases to integrate them with the PlaySight platform.

key element of the PlaySight platform is the ability to incorporate and integrate cognitive engines developed by multiple third-party

vendors, and we plan to continue to increase the number of third-party cognitive engines incorporated into our platform in order to enhance

the performance and power of our platform.

As we become increasingly dependent on third-party developers for new cognitive engines, we

may encounter difficulties in identifying additional high-quality cognitive engines, entering into agreements for their inclusion in

our ecosystem on acceptable terms or at all and/or in coordinating and integrating their technologies into our system.

We may incur additional

costs to modify and adjust existing functionalities of our platform to accommodate multiple classes of third-party cognitive engines,

without the assurance that such costs can be recouped by the additional revenues generated by the new capabilities.

As our platform becomes

more complex due to the inclusion of various third-party cognitive engines, we may not be able to integrate them in a seamless or timely

manner due to a number of factors, including incompatible software applications, lack of cooperation from developers, insufficient internal

technical resources, and the inability to secure the necessary licenses or legal authorizations required.

In addition, we currently use

third-party providers to integrate such third-party cognitive engines onto our platform.

In the future, we may require such third-party

developers to integrate their engines onto our platform, and we will be dependent in part upon their ability to do so effectively and

We may not have full control over the quality and performance of third-party providers, and therefore, any unexpected deficiencies

or problems arising from these third-party providers may cause significant interruptions of our platform.

The failure of third-party

developers to integrate their cognitive engines seamlessly into our platform and/or provide reliable, scalable services may impact the

reliability of our platform and harm our reputation and business, results of operations and financial conditions.

we are not able to enhance or introduce new products that achieve market acceptance and keep pace with technological developments, our

business, results of operations and financial condition could be harmed.

ability to attract new users and increase revenue from existing customers depends in part on our ability to enhance and improve our platforms,

increase adoption and usage of our products and introduce new products and features.

The success of any enhancements or new products

depends on several factors, including timely completion, adequate quality testing, actual performance quality, market-accepted pricing

levels and overall market acceptance and demand.

Enhancements and new products that we develop may not be introduced in a timely or cost-effective

manner, may contain defects, may have interoperability difficulties with our platform, or may not achieve the market acceptance necessary

to generate significant revenue.

If we are unable to successfully enhance our existing platform and capabilities to meet evolving customer

requirements, increase adoption and usage of our platform, develop new products, or if our efforts to increase the usage of our products

are more expensive than we expect, then our business, results of operations and financial condition could be harmed.

may experience difficulty in integrating Playsight, Gameface, or Foundation Sports with third-party applications, which would inhibit

PlaySight, Gameface, and Foundation Sports may serve a customer base with

a wide variety of constantly changing hardware, operating system software, packaged software applications and networking platforms.

PlaySight, Gameface, or Foundation Sports fails to gain broad market acceptance due to their inability to support a variety of these platforms,

our operating results may suffer.

Our business depends, in part, on the following factors:

ability to integrate PlaySight, Gameface, or Foundation Sports with multiple platforms and existing

systems and to modify our product as new versions of packaged applications are introduced;

to application program interfaces for the third-party software products that are integrated with our products;

to anticipate and support new standards;

Our management

of software being developed by third parties for our customers or for use with Foundation Sports.

program interfaces provide the instructions that are required to transfer information into and out of an application and trigger the

specific characteristics of that application.

These instructions are needed to create adapters between PlaySight, Gameface, Foundation

Sports and third-party software products, but access to application program interfaces is controlled by the vendors of these applications.

If the application vendor denies or delays our access to application program interfaces, our business may be harmed.

Some application

vendors may become competitors or establish alliances with our competitors, increasing the likelihood that we would not be granted access

to their application program interfaces.

Furthermore, we may need to modify PlaySight, Gameface, and Foundation Sports or develop new

adapters in the future as new applications or newer versions of existing applications are introduced.

If we fail to continue to develop

adapters or respond to new applications or newer versions of existing applications in a timely manner, our business could suffer.

betting and online gaming customers and partners are subject to a variety of domestic and foreign laws and regulations, which are subject

to change and interpretation and which could subject them to claims or otherwise harm our customers’ businesses.

Any change in

existing regulations or their interpretation, or the regulatory climate and requirements applicable to our or our customers’ and

suppliers’ products and services, or changes in tax rules and regulations or interpretation thereof related to our or our customers’

and suppliers’ products and services, could adversely impact our or our customers’ and suppliers’ ability to operate

our or their respective businesses as currently conducted or as we seek to operate in the future, which could have a material adverse

effect on our financial condition and results of operations.

of our customers and partners are generally subject to laws and regulations relating to sports, sports betting, online gaming, marketing

and advertising in the jurisdictions in which they conduct their businesses or in some circumstances, of those jurisdictions in which

we and they offer services or those are available, as well as the general laws and regulations that apply to all e-commerce and online

businesses, such as those related to privacy and personal information, tax, anti-money laundering, anti-bribery, advertising, competition,

inside information and disclosures, and consumer protection.

These laws and regulations vary from one jurisdiction to another and future

legislative and regulatory action, court decisions or other governmental action, which may be affected by, among other things, political

pressures, and changes in legislative or governmental priorities, may have a material impact on our operations and financial results.

In particular, some jurisdictions have introduced regulations attempting to restrict or prohibit sports betting, online gaming and advertising,

while others have taken the position that sports betting or online gaming should be licensed and regulated and have adopted or are in

the process of considering legislation and regulations to enable sports betting or online gaming in their jurisdictions.

In some jurisdictions,

additional requirements and restrictions may continue to develop.

For example, recently, the Committees of Advertising Practice in the

recommended new rules which ban sports betting advertisements if they are likely to appeal to minors, which evidences a trend in

Europe for an increasingly restrictive approach to gambling advertising more generally.

Additionally, some jurisdictions in which our

customers may operate could presently be unregulated or partially regulated and therefore more susceptible to the enactment or change

of laws and regulations.

Some jurisdictions do not have laws that grant our customers rights in the data they collect.

Any enactment

of laws in these jurisdictions would require a change in how they conduct business in such jurisdictions.

However, our customers offer

their services to customers in many more countries, but do not always have visibility of where their customers use their products and

services to offer their services to their customers.

Any of their licenses could be revoked, suspended or conditioned at any time.

license applications may also be denied or conditioned.

The loss of a license in one jurisdiction could trigger the loss of a license

or affect our eligibility for such a license in another jurisdiction, and any of such losses, or potential for such loss, could cause

us to cease offering some or all of their offerings in the impacted jurisdictions.

As laws and regulations change, they may need to obtain

and maintain licenses or registrations in additional jurisdictions.

In addition, once licensed, they may be subject to various ongoing

requirements, including supervision by the respective governmental agency of certain transfers of ownership and acquisitions.

2018, the U.S.

Supreme Court struck down the Professional and Amateur Sports Protection Act of 1992 (“PASPA”) as unconstitutional.

This decision has the effect of lifting federal restrictions on sports betting and thus allows states to determine by themselves the

legality of sports betting.

Since the repeal of PASPA, several states have legalized online sports betting.

To the extent new real money

gaming or sports betting jurisdictions are established or expanded, we cannot guarantee that our customers will be successful in penetrating

such new jurisdictions or expanding our business or customer base in line with the growth of existing jurisdictions.

If our customers

are unable to effectively develop and operate directly or indirectly within these new jurisdictions or if our customers’ competitors

are able to successfully penetrate geographic jurisdictions that they cannot access or where they face other restrictions, there could

be a material adverse effect on our customers’ and, in turn, our business, operating results and financial condition.

Our customers’

failure to obtain or maintain the necessary regulatory approvals and licenses in jurisdictions, whether individually or collectively,

could have a material adverse effect on our and their business.

expand into new jurisdictions, our customers may need to be licensed and obtain approvals of their product offerings.

This is a time-consuming

process that can be extremely costly.

Any delays in obtaining or difficulty in maintaining regulatory approvals or licenses needed for

expansion within existing jurisdictions or into new jurisdictions can negatively affect our and our customers’ opportunities for

growth, including the growth of our and our customers’ customer base, or delay our or their ability to recognize revenue from our

offerings in any such jurisdictions.

Future legislative and regulatory action, and court decisions or other governmental action, may

have a material impact on our and our customers’ operations and financial results.

Governmental authorities could view us or our

customers as having violated applicable laws or regulations, despite their efforts to obtain and maintain all applicable licenses or

There is also a risk that civil and criminal proceedings, including class actions brought by or on behalf of prosecutors or

public entities or incumbent providers, or private individuals, could be initiated against us our customers, Internet service providers,

credit card and other payment processors, advertisers and others involved in sports betting and online gaming industries.

Such potential

proceedings could involve substantial litigation expense, penalties, fines, seizure of assets, injunctions or other restrictions being

imposed upon us or our customers or other business partners, while diverting the attention of key executives.

Such proceedings could

have a material adverse effect on our and our customers’ businesses, financial condition, results of operations and prospects,

as well as impact our and our customers’ reputation.

There can be no assurance that legally enforceable legislation will not be

proposed and passed in jurisdictions relevant or potentially relevant to our business to prohibit, legislate or regulate various aspects

of sports betting and online gaming industries (or that existing laws in those jurisdictions will not be interpreted negatively).

with any such legislation may have a material adverse effect on our and our customers’ businesses, financial condition and results

of operations, either as a result of our determination that a jurisdiction should be blocked, or because a local license or approval

may be costly for us or our customers to obtain and/or such licenses or approvals may contain other commercially undesirable conditions.

Related to the Company’s Legal and Regulatory Requirements

to adequately protect our intellectual property and curb the sale of counterfeit merchandise could injure our brand and negatively affect

trademarks, copyrights, patents, designs and other intellectual property rights are important to our success and our competitive position.

We devote significant resources to the registration and protection of our trademarks and patents.

In spite of our efforts, counterfeiting

and design copies may still occur.

If we are unsuccessful in challenging the usurpation of these rights by third parties, this could

adversely affect our future sales, financial condition and results of operations.

Our efforts to enforce our intellectual property rights

can potentially be met with defenses and counterclaims attacking the validity and enforceability of our intellectual property rights.

Unplanned increases in legal fees and other costs associated with protecting our intellectual property rights could result in higher

operating expenses.

Additionally, legal regimes outside the U.S., particularly those in Asia, including China, may not always protect

intellectual property rights to the same degree as U.S.

laws, or the time required to enforce our intellectual property rights under

these legal regimes may be lengthy and delay our recovery.

may become subject to claims for remuneration or royalties for assigned service invention rights by our employees, which could result

in litigation and adversely affect our business.

significant portion of our intellectual property has been developed by our employees, or outside consultants in the course of their employment

or retention with us.

Under the Israeli Patent Law, 5727-1967, or the Patent Law, inventions conceived by an employee during the scope

of his or her employment with a company are regarded as “service inventions.” The Israeli Compensation and Royalties Committee,

or the Committee, a body constituted under the Patent Law, has previously held, in certain cases, that employees may be entitled to remuneration

for service inventions that they develop during their service for a company despite their explicit waiver of such right.

Therefore, we

may face claims by employees demanding remuneration beyond their regular salary and benefits.

may be subject to product liability lawsuits or claims, which could harm our financial condition and liquidity if we are not able to

successfully defend or insure against such claims.

may be subject to product liability lawsuits and claims that, individually or in the aggregate, could harm our business, prospects, results

of operations and financial condition.

We may face lawsuits or claims if our products do not perform as expected, malfunction or are

used without complying with their specifications.

Moreover, a product liability lawsuit or claim, regardless of merit, could generate

negative publicity about our products, which could have a material adverse effect on our brand, business, prospects, results of operations

and financial condition.

Any lawsuit or claim seeking monetary damages significantly exceeding our coverage or outside of our coverage

may have a material adverse effect on our business and financial condition.

we provide products and services related to sports betting, our business may become subject to a variety of U.S.

and foreign laws, many

of which are unsettled and still developing and which could subject us to claims or otherwise harm our business.

Any adverse change in

regulations or their interpretation, or the regulatory climate applicable to these contemplated products and services, or changes in

tax rules and regulations or interpretation thereof related to these contemplated products and services, could adversely impact our ability

to operate our business as we seek to operate in the future, which could have a material adverse effect on our financial condition and

results of operations.

business could potentially expand into sports betting, in which case our business partners are generally subject to laws and

regulations in the jurisdictions in which we will conduct our business or in some circumstances, of those jurisdictions in which we

offer our services or those are available, as well as the general laws and regulations that apply to all e-commerce businesses, such

as those related to privacy and personal information, tax and consumer protection.

These laws and regulations vary from one

jurisdiction to another and future legislative and regulatory action, court decisions or other governmental action, which may be

affected by, among other things, political pressures, attitudes and climates, as well as personal biases, may at such time have a

material impact on our operations and financial results, or may prevent our business partners from expanding into such businesses

entirely and thus, may have impact on our business.

In addition, some jurisdictions in which we may operate could presently be

unregulated or partially regulated and therefore more susceptible to the enactment or change of laws and regulations.

a result of the foregoing, future legislative and regulatory action, and court decisions or other governmental action, may have a material

impact on our business partners’ business and operations, and that may also have an impact on our operations and financial results.

Governmental authorities could view us as having violated local laws, despite efforts to obtain all applicable licenses or approvals.

There is also a risk that civil and criminal proceedings, including class actions brought by or on behalf of prosecutors or public entities

or incumbent monopoly providers, or private individuals, could be initiated against our business partners, us, and others involved in

the sports betting industry.

Such potential proceedings could involve substantial litigation expense, penalties, fines, seizure of assets,

injunctions or other restrictions being imposed upon us or our business partners.

Such proceedings could have a material adverse effect

on our business, financial condition, results of operations and prospects, as well as impact our reputation.

there can be no assurance that legally enforceable legislation will not be proposed and passed in jurisdictions relevant or potentially

relevant to our business to prohibit, legislate or regulate various aspects of the sports betting industry (or that existing laws in

those jurisdictions will not be interpreted negatively).

Compliance with any such legislation may have a material adverse effect on our

business, financial condition and results of operations, either as a result of our determination not to offer products or services in

a jurisdiction or to cease doing so, or because a local license or approval may be costly for us or our business partners to obtain and/or

such licenses or approvals may contain other commercially undesirable conditions.

in our tax obligations and effective tax rate may have a negative effect on our operating results.

may be subject to income taxes in multiple jurisdictions.

We record tax expense based on our estimates of future payments, which include

reserves for uncertain tax provisions in multiple tax jurisdictions.

At any one time, many tax years may be subject to audit by various

taxing jurisdictions.

The results of these audits and negotiations with taxing authorities may affect the ultimate settlement of these

As a result, we expect that throughout the year there could be ongoing variability in our quarterly tax rates as events occur

and exposures are evaluated.

Further, our effective tax rate in a given financial period may be materially impacted by changes in mix

and level of earnings or by changes to existing accounting rules or regulations.

In addition, tax legislation enacted in the future could

negatively impact our current or future tax structure and effective tax rates.

do not have covenants not to compete in place with our key employees.

generally do not enter into non-competition agreements as part of our employment agreements with our employees and it may be difficult

for us to restrict our competitors from benefitting from the expertise our former employees or consultants developed while working for

could be subject to changes in tax rates, adoption of new tax laws, additional tax liabilities or increased volatility in our effective

are subject to the tax laws in the U.S.

and numerous foreign jurisdictions.

Current economic and political conditions make tax laws and

regulations, or their interpretation and application, in any jurisdiction subject to significant change.

On December 22, 2017, the U.S.

enacted the Tax Cuts and Jobs Act (the “Tax Act”), which includes a number of significant changes to previous U.S.

that impact us, including provisions for a one-time transition tax on deemed repatriation of undistributed foreign earnings, and a reduction

in the corporate tax rate from 35% to 21% for tax years beginning after December 31, 2017, among other changes.

The Tax Act also transitions

international taxation from a worldwide system to a modified territorial system and includes base erosion prevention measures on

earnings, which has the effect of subjecting certain earnings of our foreign subsidiaries to U.S.

earn a substantial portion of our income in foreign countries and are subject to the tax laws of those jurisdictions.

There have been

proposals to reform foreign tax laws that could significantly impact how U.S.

multinational corporations are taxed on foreign earnings.

Although we cannot predict whether or in what form these proposals will pass, several of the proposals considered, if enacted into law,

could have an adverse impact on our income tax expense and cash flows.

of our operations are subject to a reduced tax rate or are free of tax under various tax holidays and rulings.

We also utilize tax rulings

and other agreements to obtain certainty in treatment of certain tax matters.

These holidays and rulings expire in whole or in part from

time to time and may be extended when certain conditions are met or terminated if certain conditions are not met.

The impact of any changes

in conditions would be the loss of certainty in treatment thus potentially impacting our effective income tax rate.

may also be subject to the examination of our tax returns by the U.S.

Internal Revenue Service (“IRS”) and other tax authorities.

We regularly assess the likelihood of an adverse outcome resulting from these examinations to determine the adequacy of our provision

for income taxes.

Although we believe our tax provisions are adequate, the final determination of tax audits and any related disputes

could be materially different from our historical income tax provisions and accruals.

The results of audits or related disputes could

have an adverse effect on our financial statements for the period or periods for which the applicable final determinations are made.

For example, we and our subsidiaries are also engaged in a number of intercompany transactions across multiple tax jurisdictions.

we believe we have clearly reflected the economics of these transactions and the proper local transfer pricing documentation is in place,

tax authorities may propose and sustain adjustments that could result in changes that may impact our mix of earnings in countries with

differing statutory tax rates.

the extent we may rely on endorsements or testimonials, we will review any relevant relationships for compliance with the Endorsement

Guides and we will otherwise endeavor to follow the FTC Act and other legal standards applicable to our advertising .

FTC regulates the use of endorsements and testimonials in advertising as well as relationships between advertisers and social media influencers

pursuant to principles described in the FTC’s Guides Concerning the Use of Endorsements and Testimonials in Advertising, or the

Endorsement Guides.

The Endorsement Guides provide that an endorsement must reflect the honest opinion of the endorser and cannot be

used to make a claim about a product that the product’s marketer couldn’t itself legally make.

They also say that if there

is a connection between an endorser and the marketer that consumers would not expect and it would affect how consumers evaluate the endorsement,

that connection should be disclosed.

Another principle in the Endorsement Guides applies to ads that feature endorsements from people

who achieved exceptional, or even above average, results from using a product.

If the advertiser doesn’t have proof that the endorser’s

experience represents what people will generally achieve using the product as described in the ad, then an ad featuring that endorser

must make clear to the audience what results they can generally expect to achieve and the advertiser must have a reasonable basis for

its representations regarding those generally expected results.

Although the Endorsement Guides are advisory in nature and do not operate

directly with the force of law, they provide guidance about what the FTC staff generally believes the Federal Trade Commission Act, or

FTC Act, requires in the context using of endorsements and testimonials in advertising and any practices inconsistent with the Endorsement

Guides can result in violations of the FTC Act’s proscription against unfair and deceptive practices.

the extent we may rely on endorsements or testimonials, we will review any relevant relationships for compliance with the Endorsement

Guides and we will otherwise endeavor to follow the FTC Act and other legal standards applicable to our advertising.

However, if our

advertising claims or claims made by our social media influencers or by other endorsers with whom we have a material connection do not

comply with the Endorsement Guides or any requirement of the FTC Act or similar state requirements, the FTC and state consumer protection

authorities could subject us to investigations and enforcement actions, impose penalties, require us to pay monetary consumer redress,

require us to revise our marketing materials and require us to accept burdensome injunctions, all of which could harm our business, reputation,

financial condition and results of operations.

of our contractors or our licensees’ contractors to comply with local laws and other standards could harm our business.

work with contractors outside of the U.S.

to manufacture our products.

We require the contractors that directly manufacture our products

and our licensees that make products using our intellectual property (including, indirectly, their contract manufacturers) to comply

with environmental, health and safety standards for the benefit of workers.

We also require these contractors to comply with applicable

standards for product safety.

Notwithstanding their contractual obligations, from time-to-time contractors may not comply with such standards

or applicable local law or our licensees may fail to enforce such standards or applicable local law on their contractors.

or continuing noncompliance with such standards and laws by one or more contractors could harm our reputation or result in a product

recall and, as a result, could have an adverse effect on our sales and financial condition.

Negative publicity regarding production methods,

alleged practices or workplace or related conditions of any of our suppliers, manufacturers or licensees could adversely affect our brand

image and sales and force us to locate alternative suppliers, manufacturers or licenses.

could be subject to a change in tax laws, which may impact tax rates or otherwise adversely impact our tax position and may be subject

to a tax audit.

are subject to the tax laws in the U.S.

and numerous foreign jurisdictions.

Such laws may change as a result of economic and political

conditions, or there may be changes to such laws interpretation and application.

earn a substantial portion of our income in foreign countries and are subject to the tax laws of those jurisdictions.

There have been

proposals to reform foreign tax laws that could significantly impact how U.S.

multinational corporations are taxed on foreign earnings.

Although we cannot predict whether or in what form these proposals will pass, several of the proposals considered, if enacted into law,

could have an adverse impact on our income tax expense and cash flows.

are subject to a complex array of laws and regulations, which could have an adverse effect on our business, financial condition and results

18 unchanged sentences

in significant unanticipated legal and reputational risks.

Any current or future legal or regulatory proceedings could divert management’s

attention from our operations and result in substantial legal fees.

as long as we are a “smaller reporting company,” we will not be required to comply with certain reporting requirements that

apply to other publicly reporting companies.

We cannot predict whether the reduced disclosure requirements applicable to smaller reporting

companies will make our common shares less attractive to investors.

are currently a “smaller reporting company”.

For as long as we continue to be a smaller reporting company, we may choose

to take advantage of certain exemptions from reporting requirements applicable to other publicly reporting companies that are not smaller

reporting companies.

These include not being required to comply with the auditor attestation requirements for the assessment of our internal

controls over financial reporting provided by Section 404 of the Sarbanes- Oxley Act of 2002, or the Sarbanes-Oxley Act, and not being

required to provide certain disclosure regarding executive compensation required of larger publicly reporting companies.

We cannot predict

if investors will find our common shares less attractive if we choose to rely on these exemptions.

If some investors find our common

shares less attractive as a result of any choices to reduce future disclosure, there may be a less active trading market for our shares

and our share price may be more volatile.

Further, as a result of these scaled regulatory requirements, our disclosure may be more limited

than that of other publicly reporting companies and you may not have the same protections afforded to shareholders of such companies.

are subject to the periodic reporting requirements of the Exchange Act that require us to incur audit fees and legal fees in connection

with the preparation of such reports.

These additional costs could reduce or eliminate our ability to earn a profit.

are required to file periodic reports with the SEC pursuant to the Exchange Act and the rules and regulations promulgated thereunder.

In order to comply with these requirements, our independent registered public accounting firm will have to review our financial statements

on a quarterly basis and audit our financial statements on an annual basis.

Moreover, our legal counsel will have to review and assist

in the preparation of such reports.

The costs charged by these professionals for such services cannot be accurately predicted at this

time because factors such as the number and type of transactions that we engage in and the complexity of our reports cannot be determined

at this time and will affect the amount of time to be spent by our auditors and attorneys.

However, the incurrence of such costs will

obviously be an expense to our operations and thus have a negative effect on our ability to meet our overhead requirements and earn a

for as long as we remain a “smaller reporting company,” as defined in in the Jumpstart Our Business Startups Act of 2012,

or JOBS Act, we may 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, and reduced disclosure obligations regarding executive compensation in our periodic reports

and proxy statements.

We may take advantage of these reporting exemptions until we are no longer an emerging growth company.

we cannot provide reliable financial reports or prevent fraud, our business and operating results could be harmed, investors could lose

confidence in our reported financial information, and the trading price of our common stock, if a market ever develops, could drop significantly.

Related to Ownership of Our Shares

is currently limited liquidity of shares of our common stock.

can give no assurance that an active trading market for shares of our common stock will develop on the Nasdaq or if its develops, will

be sustained, or that the shares of common stock will trade at or above the public offering price.

Failure to develop or maintain a trading

market could negatively affect its value and make it difficult or impossible for you to sell your shares.

Even if a market for common

stock does develop, the market price of common stock may be highly volatile.

In addition to the uncertainties relating to future operating

performance and the profitability of operations, factors such as variations in interim financial results or various, as yet unpredictable,

factors, many of which are beyond our control, may have a negative effect on the market price of our common stock.

The liquidity of the

shares of our common stock may also be affected adversely by a forward stock split given the reduced number of shares that will be outstanding

following a reverse stock split, especially if the market price of our common stock does not increase as a result of the forward stock

stock price may be volatile, or may decline regardless of our operating performance, and you could lose all or part of your investment

should consider an investment in our securities to be risky, and you should invest in our securities only if you can withstand a significant

loss and wide fluctuation in the market value of your investment.

The market price of our common shares could be subject to significant

fluctuations in response to the factors described in this section and other factors, many of which are beyond our control.

factors that could affect our stock price are:

or anticipated variations in our quarterly and annual operating results or those of companies perceived to be similar to

conditions, particularly during holiday shopping periods;

in expectations as to our future financial performance, including financial estimates by securities analysts and investors, or differences

between our actual results and those expected by investors and securities analysts;

in the market valuations of companies perceived by investors to be comparable to us;

public’s response to our or our competitors’ filings with the SEC or announcements regarding new products or services,

enhancements, significant contracts, acquisitions, strategic investments, litigation, restructurings or other significant matters;

about our business in the press or the investment community;

sales of our shares;

by our competitors;

or departures of members of our senior management or other key personnel;

of legislation or other regulatory developments affecting us or our industry.

addition, the securities markets have experienced significant price and volume fluctuations that have affected and continue to affect

market price of equity securities of many companies.

These fluctuations have often been unrelated or disproportionate to the operating

performance of particular companies.

These broad market fluctuations, as well as general economic, systemic, political and market conditions,

such as recessions, loss of investor confidence, interest rate changes, or international currency fluctuations, may negatively affect

the market price of our shares.

any of the foregoing occurs, it could cause our stock price to fall and may expose us to securities class action litigation that, even

if unsuccessful, could be costly to defend and a distraction to management.

trading market for our common shares will be influenced by the research and reports that equity research analysts publish about us and

our business.

The price of our common shares could decline if one or more securities analysts downgrade our common shares or if those

analysts issue a sell recommendation or other unfavorable commentary or cease publishing reports about us or our business.

more of the analysts who elect to cover us downgrade our common shares, our share 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 common share price and trading volume

do not intend to pay dividends on our shares of common stock and under the terms of certain outstanding loans, we are not permitted to

pay any dividends.

intend to retain all of our earnings, if any, for the foreseeable future to finance the operation and expansion of our business and do

not anticipate paying cash dividends.

Any future determination to pay dividends will be at the discretion of our Board of Directors,

subject to compliance with applicable law and any contractual provisions, and will depend on, among other factors, our results of operations,

financial condition, capital requirements and other factors that our Board of Directors deems relevant.

In addition, under the terms

of the loan agreements between the Company and Yonah Kalfa and Naftali Kalfa and the Company, we may not make any distributions until

these loan agreements are repaid in full.

At this time, such loans have not been repaid in full.

As a result, you should expect to receive

a return on your investment in our common shares only if the market price of our common stock increases, which may never occur.

sales, or the perception of future sales, of our common stock may depress the price of our common stock.

of April 30, 2022, we had 7,317,601 outstanding common shares.

Of these shares, 709,080 shares were in the public float or are eligible

for re-sale under Rule 144.

The remaining 6,608,521 shares common stock outstanding are “restricted securities” within the

meaning of Rule 144.

In addition, on September 8, 2021, we filed a registration statement with the SEC to register an additional 1,640,000

shares of common stock, which was declared effective on January 27, 2022.

On September 28, 2022, we issued (i) 1,018,510 shares of common

stock and (ii) pre-funded warrants (the “Pre-Funded Warrants”) to purchase an aggregate of 11,802,002 shares of its common

stock, together with accompanying common stock warrants, at a combined purchase price of $0.39 per share of the common stock and associated

common stock warrant and $0.3899 per Pre-Funded Warrant and associated common stock warrants.

The Pre-Funded Warrants have an exercise

price of $0.00001 per share of common stock and are exercisable until the Pre-Funded Warrants are exercised in full.

The shares of common

stock and Pre-Funded Warrants were sold in the offering together with common stock warrants to purchase 12,820,512 shares of common stock

at an exercise price of $0.39 per share and a term of five years following the initial exercise date (the “5-Year Warrants”)

and warrants to purchase 25,641,024 shares of common stock at an exercise price of $0.43 per share and a term of seven and one half years

(the “7.5-Year Warrants”) following the initial exercise date (collectively, the “September Warrants”.

6, 2023, the Company issued warrants to purchase 9,049,774 shares of the Company’s common stock (the “January Warrants”).

The January Warrants have an exercise price per share equal $0.221.

The issuance of the January Warrants at an exercise price of $0.221

reset the exercise price of the Noteholder Warrants (as defined below) to $0.221 per share from the original exercise price of $30.00.

Sales of the shares underlying the Pre-Funded Warrants, the September Warrants, the January Warrants and the Noteholder Warrants in the

public market after the date hereof, or the perception that these sales could occur, could reduce the market price of our common stock.

If our stock is priced or closes at a price that would reduce the conversion price of the notes to be below approximately $15.00, additional

conversion shares will be issuable upon the automatic conversion of the notes, and we will be required to file a new registration statement

covering the new conversion shares as soon as reasonably practicable following the determination of the number of new conversion shares

that need to be registered.

The new registration statement will cover both the shares originally registered for resale and the new conversion

Additional sales of our common shares in the public market after the date hereof, or the perception that these sales could occur,

could reduce the market price of our common stock.

will be required to file an additional registration statement once we regain compliance with the Nasdaq listing requirements.

September 8, 2021, we filed a registration statement with the SEC to register 1,640,000 shares of common stock for resale by certain

selling stockholders, which was declared effective on January 27, 2022.

Following our public offering resulting in our common stock being

listed on Nasdaq and once we regain compliance with the Nasdaq listing standards, additional conversion shares need to be registered.

We also have agreed to register additional shares in connection with our recent financing.

Business—Recent Developments”

for more information.

The new registration statement will cover both the shares originally registered for resale, the new conversion

shares and the recent financing shares.

of the Company’s large shareholders may be able to exert significant influence on the Company and their interests may conflict

with the interests of its other shareholders .

of the Company’s large shareholders, including our officers and directors, represent approximately 44.5% of the Company’s

voting rights as of April 30, 2022.

Therefore, these shareholders would be able to exert significant influence over certain matters,

including matters that must be resolved by the general meeting of shareholders, such as the election of members to the board of directors

or the declaration of dividends or other distributions.

To the extent that the interests of these shareholders may differ from the interests

of the Company’s other shareholders, the Company’s other shareholders may be disadvantaged by any actions that these shareholders

may seek to pursue.

stockholders may not be able to enforce judgments entered by United States courts against certain of our officers and directors.

are incorporated in the State of Delaware.

However, some of our directors and executive officers may reside outside of the U.S.

result, our stockholders may not be able to effect service of process upon those persons within the

or enforce against those persons judgments obtained in U.S.

sale of a large number of shares of common stock by our principal shareholder could depress the market price of our common stock.

of July 31, 2021, Yonah Kalfa beneficially owned approximately 67% of our common stock outstanding.

The shares may

become available for resale, subject to the requirements of the U.S.

of April 30, 2022, Yonah Kalfa beneficially owned approximately 32% of our common stock outstanding.

The shares may become available

for resale, subject to the requirements of the U.S.

securities laws.

The sale or prospect of a sale of a substantial

number of these shares could have an adverse effect on the market price of our common stock.

we fail to remain current on our reporting requirements, we could be removed from the OTC Bulletin Board, which would limit the ability

of broker-dealers to sell our securities in the secondary market.

trading on the Over the Counter (OTC) Bulletin Board must be reporting issuers under Section 12 of the Securities Exchange Act of 1934,

as amended, and must be current in their reports under Section 13, in order to maintain price quotation privileges on the OTC Bulletin

As a result, the market liquidity for our securities could be severely adversely affected by limiting the ability of broker-dealers

to sell our securities and the ability of shareholders to sell their securities in the secondary market.

In addition, we may be

unable to get relisted on the OTC Bulletin Board, which may have an adverse material effect on the Company.

common stock is considered a “penny stock,”

any investment in our shares is considered to be a high-risk investment and

is subject to restrictions on marketability.

common stock is considered a “penny stock”

because it is quoted on the OTCQB and it trades for less than $5.00 per share.

The OTCQB is generally regarded as a less efficient trading market than the NASDAQ Capital or Global Markets or the New York Stock Exchange.

The SEC has rules that regulate broker-dealer practices in connection with transactions in “penny stocks.”

Penny stocks generally

are equity securities with a price of less than $5.00 per share (other than securities registered on certain national securities exchanges

or quoted on the NASDAQ system, provided that current price and volume information with respect to transactions in such securities is

provided by the exchange or system).

The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise

exempt from those rules, to deliver a standardized risk disclosure document prepared by the SEC, which specifies information about penny

stocks and the nature and significance of risks of the penny stock market.

The broker-dealer also must provide the customer with bid

and offer quotations for the penny stock, the compensation of the broker-dealer and any salesperson in the transaction, and monthly account

statements indicating the market value of each penny stock held in the customer’s account.

In addition, the penny stock rules require

that, prior to effecting a transaction in a penny stock not otherwise exempt from those rules, the broker-dealer must make a special

written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser’s written agreement

to the transaction.

These disclosure requirements may have the effect of reducing the trading activity in the secondary market for our

common stock.

Since our common stock is subject to the regulations applicable to penny stocks, the market liquidity for our common stock

could be adversely affected because the regulations on penny stocks could limit the ability of broker-dealers to sell our common stock

and thus your ability to sell our common stock in the secondary market in the future.

We can provide no assurance that our common stock

will be quoted or listed on the OTCQB, NASDAQ or any exchange, even if eligible in the future.

The sale or prospect of a sale of a substantial number of these

shares could have an adverse effect on the market price of our common stock.

sales of our common stock may result in a decrease in the market price of our common stock, even if our business is doing well.

market price of our common stock could drop due to sales of a large number of shares of our common stock in the market or the perception

that such sales could occur.

This could make it more difficult to raise funds through future offerings of common stock.

we implement a reverse stock split to regain compliance with the Bid-Price Rule, it may not result in a proportional increase in the

per share price of our common stock.

described above under “Item 1.

Business—Recent Developments,” Nasdaq informed us on October 10, 2022, that we were

not in compliance with the Bid Price Rule and that we had until April 10, 2023 to regain such compliance.

To do so, our Board of Directors

is contemplating a 1-for-10 reverse stock split.

The effect of a future reverse stock split, if any, on the market price for our common

stock cannot be accurately predicted.

In particular, we cannot assure you that the prices for shares of the common stock after a future

reverse stock split will increase proportionately to prices for shares of our common stock immediately before a reverse stock split.

The market price of our common stock may also be affected by other factors which may be unrelated to a future reverse stock split or

the number of shares outstanding.

even if the market price of our common stock does rise following a reverse stock split, we cannot assure you that the market price of

our common stock immediately after a reverse stock split will be maintained for any period of time.

Moreover, because some investors

may view a reverse stock split negatively, we cannot assure you that a reverse stock split will not adversely impact the market price

of our common stock.

Accordingly, our total market capitalization after a reverse stock split may be lower than the market capitalization

before a reverse stock split.

may be diluted significantly through our efforts to obtain financing and satisfy obligations through issuance of additional shares .

Board of Directors has authority, without action or vote of the shareholders, to issue all or part of the authorized 300,000,000 shares

that are not issued or reserved for issuance under convertible or exchangeable instruments.

In addition, we may attempt to raise additional

capital by selling shares, possibly at a deep discount to market.

These actions will result in dilution of the ownership interests of

existing shareholders, further dilute common stock book value, and that dilution may be material.

reverse stock split may not help generate additional investor interest.

can be no assurance that a reverse stock split will result in a per share price that will attract institutional investors or investment

funds or that such share price will satisfy the investing guidelines of institutional investors or investment funds.

As a result, the

trading liquidity of our common stock may not necessarily improve.

can be no assurances that our common stock will not be subject to potential delisting if we do not regain compliance with the listing

requirements of the Nasdaq.

have listed the shares of our common stock on the Nasdaq, under the symbol “CNXA.” As such we are e subject to, among other

things, our fulfilling all of the listing requirements of the Nasdaq.

In addition, Nasdaq has rules for continued listing, including,

without limitation, minimum market capitalization and other requirements.

As described above under “Item 1.

Business—Recent

Developments,” Nasdaq informed us that we are deficient with respect to several continued listing criteria.

Failure to maintain

our listing (i.e., being de-listed from the Nasdaq), would make it more difficult for shareholders to sell our common stock and more

difficult to obtain accurate price quotations on our common stock.

This could have an adverse effect on the price of our common stock.

Our ability to issue additional securities for financing or other purposes, or otherwise to arrange for any financing we may need in

the future, may also be materially and adversely affected if our common stock is not traded on a national securities exchange.

have received notices of delinquency from the Nasdaq for violations of listing rules and there is no assurance that we will regain compliance

and maintain our listing on the Nasdaq.

have received a number of letters from The Nasdaq Stock Market LLC (“Nasdaq”) from

the period starting on August 16, 2022 through March 21, 2023 (i) notifying us that we are not in compliance with the periodic filing

requirements for continued listing because our (i) Annual Report on Form 10-K with respect to the fiscal year ended April 30, 2022

and (ii) Quarterly Reports on Form 10-Q for the periods ended July 31, 2022 and October 31, 2022 (collectively, the “Delinquent

Filings”), by February 13, 2023 (the due date for filing the Delinquent Filings pursuant to an exception to Nasdaq’s Listing

Rule previously granted by Nasdaq) and our Form 10-Q for the fiscal quarter ended January 31, 2023 was

not filed with the Securities and Exchange Commission (the “SEC”) by the required due date of March 17, 2023,

which is an additional basis for delisting the Company’s securities from the Nasdaq and (ii) indicating that the Nasdaq Hearings

Panel (the “Panel”) would consider this matter in rendering a determination regarding the Company’s continued listing

on the Nasdaq at its hearing on Thursday, March 30, 2023.

On October 10, 2022, we

received a letter from the Listing Qualifications Department of the Nasdaq indicating that our common stock is subject to potential delisting

from Nasdaq because, for a period of 30 consecutive business days, the bid price of the Company’s common stock closed below

the minimum $1.00 per share requirement for continued listing under Nasdaq Listing Rule 5450(a)(1) (the “Bid Price Rule”).

The Nasdaq notice indicated that, in accordance with Nasdaq Listing Rule 5810(c)(3)(A), the Company will be provided 180 calendar

days, or until April 10, 2023, to regain compliance.

The Company did not regain compliance with the Bid Price Rule before April

10, 2023, but requested at its hearing on March 30, 2023 an additional period of six months to cure the deficiency by effecting a reverse

stock split, if necessary.

We have also been notified by

the Nasdaq that due to the resignations from the Company’s board, audit committee and compensation committee on November 17, 2022,

we no longer comply with Nasdaq’s independent director, audit committee and compensation committee requirements as set forth in

Listing Rule 5605.

On March 30, 2023, the Company

had its hearing with the Nasdaq, which indicated that a decision with respect to the Company’s listing status on the Nasdaq would

be rendered within two weeks.

On April 12, 2023, the Company

received a letter from the Listing Qualifications Department of the Nasdaq indicating that the Company had not yet regained compliance

with the Bid Price Rule, which serves as an additional basis for delisting the Company’s securities from the Nasdaq.

further indicated that the Panel will consider this matter in its decision regarding the Company’s continued listing on the Nasdaq

Capital Market.

In that regard, the Nasdaq indicated that the Company should present its views with respect to this additional delinquency

to the Panel in writing no later than April 19, 2023.

To date, we have not yet filed

our Delinquent Filings other than this annual report on Form 10-K, although work on completing such filings is ongoing and have not received

a response from the Nasdaq with respect to our requests for extensions of time to regain compliance with the listing requirements with

respect to which we are currently in violation.

The Company offers no assurance

that its request to be granted further time to file its Delinquent Filings, regain compliance with the Bid Price Rule and redress its

Corporate Governance Deficiencies and to remain listed on the Nasdaq will be granted.

can be no assurance that the Company will be successful in its efforts to maintain its Nasdaq listing.

If the Company’s common

stock ceases to be listed for trading on the Nasdaq Capital Market, the Company would expect that its common stock would be traded on

one of the three tiered marketplaces of the OTC Markets Group.

The Company intends to closely monitor the closing bid price of its common

stock and consider all available options to remedy the bid price deficiency to regain compliance with the Bid Price Rule.

securities or industry analysts do not publish research or publish inaccurate or unfavorable research about our business, our stock price

and trading volume could decline.

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

us or our business.

Securities and industry analysts do not currently, and may never, publish research on our company.

If no securities

or industry analysts commence coverage of our company, the trading price for our stock may be negatively impacted.

In the event securities

or industry analysts initiate coverage, if one or more of the analysts who covers us downgrades our stock or publishes inaccurate or

unfavorable research about our business, our stock price may decline.

If one or more of these analysts ceases coverage of our company

or fails to publish reports on us regularly, demand for our stock could decrease, which might cause our stock price and trading volume

our shares of common stock 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 obtain or retain a listing on the Nasdaq 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

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.

significant portion of our total outstanding shares is restricted from immediate resale but may be sold into the market in the near future,

which could cause the market price of our common stock to decline significantly, even if our business is doing well.

of a substantial number of shares of our common stock in the public market could occur at any time.

Upon the expiration or early release

of any or all of the lock-up agreements entered into between the Representatives and each of our directors, executive officers and holders

of more than 5% of our outstanding common stock, a significant amount of shares of our common stock may be sold, or there may be a perception

that they will be sold, in the public market.

Additionally,

upon the (i) expiration of, (ii) early release of, and (iii) terms permitting sales of shares of the Company’s common stock at

certain times, a significant amount of shares of our common stock may be sold, or there may be a perception that they will be sold, in

the public market.

the sale, or the perception that a sale will occur, as described above, our stock price may decline significantly, even if our business

is doing well.

UNRESOLVED STAFF COMMENTS

Not applicable

to smaller reporting companies.

applicable to smaller reporting companies.

of the date of this report, we do not own any properties.

The Company does lease some office space under short-term leases

with terms under a year.

Our principal office is located at 2709 N.

Rolling Road, Suite 138, Windsor

Mill, Maryland 21244.

We entered into a lease for use of office space at this location effective September 1, 2019.

This location is

owned by Zeek Logistics.

We do not pay any rent or fee to use this location.

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