Company: NEGG
Filing Date: 2025-04-28
Form Type: 20-F
Source: 0001213900-25-036055
Chunk: 108

Company: Newegg Commerce, Inc.
Filing Date: 2025-04-28
Form: 20-F
Item: Item 6
Chunk 108
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 indemnification agreements
with our directors and executive officers. These agreements require us to indemnify these individuals, to the fullest extent permitted
by law, for certain liabilities to which they may become subject as a result of their affiliation with us.

Insofar as indemnification for liabilities arising
under the Securities Act may be permitted for our directors or officers under the foregoing provisions, we have been informed that in
the opinion of the SEC, such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable
as a matter of United States law.

Involvement in Certain Legal Proceedings

On August 6, 2020, Hangzhou Lianluo and Mr. Zhitao
He received an investigation notice from the China Securities Regulatory Commission (“ CSRC”) for alleged violation of laws
and regulations regarding information disclosures of Hangzhou Lianluo. Hangzhou Lianluo is a PRC company with shares listed
on the National Equities Exchange and Quotations, a Chinese over-the-counter exchange, and is a majority owner of Newegg through Digital
Grid, a wholly-owned subsidiary of Hangzhou Lianluo. Mr. He is the Chairman and Chief Executive Officer of Hangzhou Lianluo. Mr. He was
the former Chairman and the former Chief Executive Officer of Lianluo Smart Limited (the predecessor company of Newegg prior to the
Merger) and is currently the chairman of our Board.

On October 19, 2020, Hangzhou Lianluo announced
that it has received a notice of administrative punishment from the Zhejiang Regulatory Bureau of CSRC, which provided, among other things,
that (i) Hangzhou Lianluo received a warning and would be required to correct its unlawful acts and pay a fine of RMB 300,000, and (ii)
Mr. Zhitao He received a warning and was required to pay a fine of RMB 400,000.

Further, the shares of our common stock owned
by Digital Grid have been pledged to Bank of China Limited Zhejiang Branch(“ BOC”) as collateral to support working capital
loans and letters of credit provided by BOC to Hangzhou Lianluo. The loans have been guaranteed jointly and severally by Beijing Digital
Grid Technology Co., Ltd., a subsidiary of Hangzhou Lianluo, and by Mr. Zhitao He. The total principal amount owed under these loans as
of March