Company: NEGG
Filing Date: 2025-04-28
Form Type: 20-F
Source: 0001213900-25-036055
Chunk: 46

Company: Newegg Commerce, Inc.
Filing Date: 2025-04-28
Form: 20-F
Item: Item 3
Chunk 46
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 Sheets market. As a result, selling our common shares could be more difficult because smaller quantities of
shares would likely be bought and sold, transactions could be delayed, and security analysts’ coverage of us may not arise. In addition,
in the event our common shares are delisted, broker dealers would bear certain regulatory burdens which may discourage broker dealers
from effecting transactions in our common shares and further limit the liquidity of our shares. These factors could result in lower prices
and larger spreads in the bid and ask prices for our common shares. Such delisting from Nasdaq and continued or further declines in our
common share price could also greatly impair our ability to raise additional necessary capital through equity or debt financing and could
significantly increase the ownership dilution to shareholders caused by our issuing equity in financing or other transactions.

We and our directors and officers may be
involved in investigations or other forms of regulatory or governmental inquiry which may cause reputational harm to the Company, result
in additional expenses, and distract our management from our day-to-day operations.

From time to time, we and our directors and officers
may be involved in investigations or other forms of regulatory or governmental inquiry covering a range of possible issues including but
not limited to securities laws compliance. See “ Item 6. C. Board Practices - Involvement in Certain Legal Proceedings”
for a discussion of current legal proceedings.

These inquiries or investigations could lead to
administrative, civil or criminal proceedings involving us and could result in fines, penalties, restitution, other types of sanctions,
or the need for us to undertake remedial actions, or to alter our business, financial or accounting practices. Our practice is to cooperate
fully with regulatory and governmental inquiries and investigations.

Legal proceedings, inquiries and regulatory investigations
are often unpredictable, and it is possible that the ultimate resolution of any such matters, if unfavorable, may be material to our results
of operations in any future period, depending, in part, upon the size of the loss or liability imposed and the operating results for the
period, and could have a material adverse effect on our business. In addition, regardless of the ultimate outcome of any such legal proceeding,
inquiry or investigation, any such matter could cause us to incur additional expenses, which could be significant, and possibly material,
to our results of operations in any future period.

Any of these factors may result in large and sudden
changes in the volume and price at which the common shares will trade.

Shareholders of a public company often bring securities
class action