Risk Factors Update Summary

• The FCA's directive requires insurers to cease selling the GAP product starting February 2024, impacting revenue.
• Global events like the COVID-19 pandemic and geopolitical conflicts have created economic uncertainty, affecting revenue.
• The new labor codes, if implemented, will introduce significant changes, including a single registration for companies. This may increase compliance costs and management burdens.
• New regulations may lead to substantial compliance costs, impacting operations and financial condition. This could result in increased expenses and reduced net income.
• The resubmission process for GAP product approval introduces uncertainty, potentially delaying sales and affecting profitability.
• The current conflicts between Ukraine and Russia and between Israel and Hamas have caused uncertainty about economic and political stability, increasing volatility in the credit and financial markets.
• If we cannot develop AI compatible with evolving standards, our market position could be adversely affected.
• The company is establishing a compliance tracking system under Indian Insurance Broker Laws to prevent penalties. This change might result in reduced regulatory risks and potential fines.
• The entry into new markets or new features may not be successful, impacting growth.
• New regulations could increase costs of providing online services, impacting overall operational expenses significantly.
• The company may incur substantial costs to maintain director and officer liability insurance, affecting financial resources. This could lead to increased operational costs.
• Cybersecurity risks, including data breaches, could harm our reputation and lead to significant financial liabilities.
• New regulations may impose penalties up to €20 million or 4% of global turnover for GDPR violations. This could significantly impact financial conditions if non-compliance occurs.
• Changes in the automotive insurance industry, including autonomous vehicles, could significantly impact operations.
• The penalties for regulatory lapses could be up to three times the sum involved in contraventions. This change might result in substantial financial liabilities for the company.
• Our financial performance depends on the economy; declines may result in decreased revenue and demand.
• The company incurred net losses of $99.9 million for the fiscal year ended March 31, 2024, compared to $14.2 million in 2023.
• We incurred a net loss of approximately $99.9 million during the period ended March 31, 2024, impacting our financial condition.
• If insurance customers fail to comply with regulations, they could lose certifications, reducing our revenues.
• We may need to recruit additional talent and resources to support our operations as a public company, increasing operational costs.
• Future regulations may force costly changes to our software, potentially impacting our competitive position and profitability.
• A substantial downturn in the insurance industry may lead to reduced capital expenditures and spending.
• The company intends to take advantage of extended transition periods for compliance, potentially delaying unexpected expenses for up to five years. This may impact financial planning.
• We had cash and cash equivalents of approximately $11.2 million as of March 31, 2024, which may not support our operational needs.
• As of March 31, 2024, the company had 33 insurance customer agreements, up from 26 in the prior year.
• We may face increased legal and financial compliance costs as we transition to a public company, impacting profitability.
• The effective corporate tax rate for a company with a Place of Effective Management in India could be 40% plus applicable surcharges. This may significantly impact financial conditions.
• The California Privacy Rights Act (CPRA) introduces new data privacy rights and operational requirements effective January 1, 2023. Compliance costs may increase substantially due to these changes.
• The company may face increased scrutiny from tax authorities if deemed to have a business connection in India. This could lead to additional tax liabilities and compliance costs.
• Our management has limited experience in operating a public company, which could hinder effective management and growth.
• The company may not be able to provide reliable financial reports, harming investor confidence and trading prices. This could lead to significant market volatility.
• The company may face increased scrutiny and potential penalties from evolving privacy laws across multiple states, including Illinois and Texas. This could adversely affect business operations and costs.
• We may incur income tax in India if we cannot certify as a non-domiciled company, affecting financial condition.
• Revenue from 10 customers accounted for approximately 79% of total revenue, indicating high customer concentration risk.
• As an emerging growth company, the company may rely on exemptions from reporting requirements, potentially making its securities less attractive to investors. This could affect market perception.
• The GDPR restricts data transfers outside the EU, potentially complicating operations and increasing compliance costs. Non-compliance could lead to significant fines and operational disruptions.
• Our effective tax rate could fluctuate due to changes in earnings mix across jurisdictions, impacting overall profitability.
• The company plans to expand its AI solutions in the automotive insurance sector, requiring significant investment.
• The volatility in trading activity on India's principal stock exchanges may adversely affect the company's financial performance and share price. This could lead to investor uncertainty.
• The company may face increased costs and decreased profit margins due to adjustments required for the GAP product.