Company: KWIK
Filing Date: 2025-03-31
Form Type: 10-K
Source: 0001683168-25-002055
Chunk: 101

Company: KwikClick, Inc.
Filing Date: 2025-03-31
Form: 10-K
Item: Item 1A
Chunk 101
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 may
be held invalid, be unenforceable, or may otherwise not be effective in protecting our platform. We rely on trade secret protection for
parts of our technology and intellectual property. To the extent we do seek patent protection, any U.S. or other patents issued to us
may not be sufficiently broad to protect our proprietary technologies.

In addition, we may not be effective in policing unauthorized
use of our intellectual property and authorized uses may not have the intended effect. Even if we do detect violations, we may need to
engage in litigation or licensing to enforce our intellectual property rights. Any enforcement efforts we undertake, including litigation,
could be time-consuming and expensive and could divert our management’s attention. In addition, our efforts may be met with defenses
and counterclaims challenging the validity and enforceability of our intellectual property rights or may result in a court determining
that our intellectual property rights are unenforceable. The legal framework surrounding protection of intellectual property changes frequently
throughout the world, particularly as to technologies used in e-commerce, and these changes may impact our ability to protect our intellectual
property and defend against third-party claims. If we are unable to cost-effectively protect our intellectual property rights, then our
business could be harmed.

STRATEGIC RISKS RELATED TO OUR BUSINESS AND INDUSTRY

Our first significant customer base is expected
to be through a group of network marketing companies which are subject to extensive regulation and scrutiny and any failure by these types
of companies to comply with these regulations could materially harm our business, financial condition, and operating results.

We plan to enter into software license agreements
with a group of network marketing companies making it a potentially significant, if not primary, source of revenue to us. The compensation
practices of these direct-selling organizations are subject to a number of federal, state, and foreign regulations administered by the
FTC and other federal, state, and foreign agencies. Regulations applicable to network marketing organizations generally are directed at
preventing fraudulent or deceptive schemes, sometimes referred to as “pyramid” or “multi-level marketing” schemes,
by ensuring that product sales ultimately are made to consumers and that advancement within an organization is based on genuine demands
and sales of the organization’s products rather than investments in the organization or other non-retail sales-related
criteria. For example, in certain foreign countries, compensation to distributors in the direct-selling industry may be limited to a certain
percentage of sales.

The regulatory requirements concerning network marketing
programs do not