Company: NEGG
Filing Date: 2025-04-28
Form Type: 20-F
Source: 0001213900-25-036055
Chunk: 12

Company: Newegg Commerce, Inc.
Filing Date: 2025-04-28
Form: 20-F
Item: Item 3
Chunk 12
---
, financial condition and results of operations.

The loss of key employees or the failure
to attract or retain qualified personnel can have a material adverse effect on our ability to run our business.

The loss of any of our current executives, key
employees or key advisors, or the failure to attract, integrate, motivate and retain additional key employees, can have a material adverse
effect on our business. Competition for well-qualified and skilled employees has been increasingly intense, and our future success also
depends on our continuing ability to attract, develop, motivate and retain highly qualified and skilled employees, including, in particular,
software engineers, data scientists and technology and fulfillment professionals. Although we have employment agreements with our executive
officers, all of our executive officers are employed “at-will” and could terminate their employment at any time. If we lose
one or more of our executive officers or other key employees, our ability to implement our business strategy successfully can be seriously
harmed. Furthermore, replacing executive officers or other key employees with other highly skilled and qualified candidates has been and
may continue to be difficult, taking an extended period of time. For example, as previously announced, our Chief Financial Officer, Robert
Chang, retired in May 2024. While the search for a permanent replacement is ongoing, these processes can be time-consuming and disruptive
to our business, and we cannot guarantee that a suitable candidate will be identified in a timely manner, if at all. Recruiting skilled
personnel is highly competitive. There can be no assurance that we will continue to attract and retain the personnel needed for our business.
The failure to attract or retain qualified personnel could have a material adverse effect on our business.

A significant inadvertent disclosure
or breach of confidential or personal information we hold could be detrimental to our business, reputation and results of operations.

Our business requires the storage, transmission
and utilization of data, including personal information, much of which must be maintained on a confidential basis. These activities have
made, and may in the future make, us a target of cyber-attacks by third parties seeking unauthorized access to the data we maintain, including
our customer data, or to disrupt our ability to provide service. As a result of the types and volume of personal data on our systems,
we believe that we are a particularly attractive target for such breaches and attacks. For example, in 2018, Newegg suffered an intrusion
of a portion of its network, as a result of which access was gained to a limited amount of