Company: NEGG
Filing Date: 2025-04-28
Form Type: 20-F
Source: 0001213900-25-036055
Chunk: 37

Company: Newegg Commerce, Inc.
Filing Date: 2025-04-28
Form: 20-F
Item: Item 3
Chunk 37
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 3% in Taiwan, and 2% in Canada and other countries
and regions. In some of the countries in which we operate, employment laws may grant significant job protection to employees, including
rights on termination of employment and setting maximum number of hours and days per week that a particular employee is permitted to work.
In addition, in certain countries in which we operate, Newegg is or may be required to consult and seek the advice of employee representatives
and/or unions. These laws, coupled with the requirement to consult with any relevant employee representatives and unions, could impact
our ability to react to market changes and the needs of our business.

Our ability to use our net operating loss
carryforwards and certain other tax attributes may be limited and could adversely impact our business, financial condition and operating
results.

Under Sections 382 and 383 of the Code, if a corporation
undergoes an “ownership change,” the corporation’s ability to use its pre-change net operating loss carryforwards and
other pre-change tax attributes to offset its post-change income and taxes may be limited. In general, an “ownership change”
occurs if there is a cumulative change in our ownership by one or more “5% shareholders” (as defined under U. S. income tax
laws) that exceeds 50 percentage points over a rolling three-year period. Similar rules apply under state tax laws. We believe it is possible
that we may experience an ownership change in the future as a result of shifts in our stock ownership, some of which are outside our control,
in which case we may be limited in our ability to use our net operating loss carryforwards and other tax assets to reduce taxes owed on
the net taxable income that we earn. If finalized, Treasury Regulations currently proposed under Section 382 of the Code may further limit
our ability to utilize our pre-change net operating losses and tax credit carryforwards if we undergo such an ownership change.

We are treated as a U. S. corporation for
all U. S. federal tax purposes.

We believe that we are an inverted corporation
for U. S. federal tax purposes. This means that, notwithstanding that we are a company incorporated in the BVI, we will be treated for
all U. S. federal tax purposes as if we are a U. S. corporation and you will be treated for all U. S. federal tax purposes as holding the
stock of a U. S. corporation. See “ Item 10. Additional Information -