(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)

(Name, address, including zip code, and telephone number, including area code, of agent for service)

Approximate date of commencement of proposed sale to the public: As soon as practicable after this registration statement is declared effective.

If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act, check the following box. ☒

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided to Section 7(a)(2)(B) of the Securities Act. ☐

The registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, as amended, or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

The information in this preliminary prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This preliminary prospectus is not an offer to sell these securities and we are not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.

This prospectus relates to the registration of the resale of up to 41,666,554 shares of our common stock, $0.001 par value per share (the “common stock”), by our stockholders identified in this prospectus, or their permitted transferees (the “Registered Stockholders”), in connection with our direct listing (the “Direct Listing”) on the Nasdaq Capital Market (“Nasdaq”).

Unlike an initial public offering, the resale by the Registered Stockholders is not being underwritten by any investment bank. The Registered Stockholders may, or may not, elect to sell their shares of common stock covered by this prospectus, as and to the extent they may determine. The Registered Stockholders may offer, sell or distribute all or a portion of the securities hereby registered publicly or through private transactions at prevailing market prices or at negotiated prices. We are required to pay certain costs, expenses and fees in connection with the registration of these securities, including with regard to compliance with state securities or “blue sky” laws. The Registered Stockholders will bear all commissions and discounts, if any, attributable to their sale of shares of common stock (see the “Plan of Distribution” section). If the Registered Stockholders choose to sell or distribute, as applicable, their shares of common stock, we will not receive any proceeds from the sale or distribution, as applicable, of shares of our common stock by the Registered Stockholders.

Prior to this Direct Listing, no public market has existed for our common stock. We intend to apply to have our common stock listed on Nasdaq under the symbol “[●]^”. If our application is not approved or we otherwise determine that we will not be able to secure the listing of our common stock on Nasdaq, we will not complete this Direct Listing. This listing is a condition to the offering. No assurance can be given that our application will be approved and that our common stock will ever be listed on Nasdaq. If our listing application is not approved by Nasdaq, we will not be able to consummate the offering and will terminate this Direct Listing.

We will be deemed to be a “controlled company” under the Nasdaq listing rules because Giri Devanur, our chief executive officer and Chairman, owns 65.0% of our outstanding common stock. As a controlled company, we are not required to comply with certain of Nasdaq’s corporate governance requirements. We do not currently intend to take advantage of any of these exceptions. See “Prospectus Summary — Controlled Company.”

Investing in our common stock involves a high degree of risk. Before buying any shares, you should carefully read the discussion of material risks of investing in our common stock in “Risk Factors” beginning on page 13 of this prospectus.

We are an “emerging growth company,” as defined under U.S. federal securities laws and, as such, are eligible and have elected to comply with certain reduced public company reporting requirements for this prospectus and for future filings.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

This prospectus includes forward-looking statements, which involve risks and uncertainties. These forward-looking statements can be identified by the use of forward-looking terminology, including the terms “believe,” “estimate,” “project,” “anticipate,” “expect,” “seek,” “predict,” “continue,” “possible,” “intend,” “may,” “might,” “will,” “could,” would” or “should” or, in each case, their negative, or other variations or comparable terminology. These forward-looking statements include all matters that are not historical facts. They appear in a number of places throughout this prospectus and include statements regarding our intentions, beliefs or current expectations concerning, among other things, our products, product development, prospects, strategies, the industry in which we operate and potential acquisitions. We derive many of our forward-looking statements from our operating budgets and forecasts, which are based upon many detailed assumptions. While we believe that our assumptions are reasonable, we caution that it is very difficult to predict the impact of known factors, and, of course, it is impossible for us to anticipate all factors that could affect our actual results. Forward-looking statements should not be read as a guarantee of future performance or results and may not be accurate indications of when such performance or results will be achieved. In light of these risks and uncertainties, the forward-looking events and circumstances discussed in this prospectus may not occur and actual results could differ materially from those anticipated or implied in the forward-looking statements.

Forward-looking statements speak only as of the date of this prospectus. You should not put undue reliance on any forward-looking statements. We assume no obligation to update forward-looking statements to reflect actual results, changes in assumptions or changes in other factors affecting forward-looking information, except to the extent required by applicable laws. If we update one or more forward-looking statements, no inference should be drawn that we will make additional updates with respect to those or other forward-looking statements.

You should read this prospectus and the documents that we reference in this prospectus and have filed with the SEC as exhibits to the registration statement of which this prospectus is a part with the understanding that our actual future results, levels of activity, performance and events and circumstances may be materially different from what we expect. All forward-looking statements are based upon information available to us on the date of this prospectus. Important factors that could cause our results to vary from expectations include, but are not limited to:

By their nature, forward-looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. We caution you that forward-looking statements are not guarantees of future performance and that our actual results of operations, financial condition, business and prospects may differ materially from those made in or suggested by the forward-looking statements contained in this prospectus. In addition, even if our results of operations, financial condition, business and prospects are consistent with the forward-looking statements contained in this prospectus, those results may not be indicative of results in subsequent periods.

The foregoing does not represent an exhaustive list of matters that may be covered by the forward-looking statements contained herein or risk factors that we are faced with. Forward-looking statements necessarily involve risks and uncertainties, and our actual results could differ materially from those anticipated in the forward-looking statements due to a number of factors, including those set forth below under “Risk Factors” and elsewhere in this prospectus. The factors set forth below under “Risk Factors” and other cautionary statements made in this prospectus should be read and understood as being applicable to all related forward-looking statements wherever they appear in this prospectus. The forward-looking statements contained in this prospectus represent our judgment as of the date of this prospectus. We caution readers not to place undue reliance on such statements. Except as required by law, we undertake no obligation to update publicly any forward-looking statements for any reason, even if new information becomes available or other events occur in the future. All subsequent written and oral forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by the cautionary statements contained above and throughout this prospectus.

You should read this prospectus and the documents that we reference in this prospectus and have filed as exhibits to the registration statement of which this prospectus is a part completely and with the understanding that our actual future results may be materially different from what we expect. We qualify all of our forward-looking statements by these cautionary statements.

This prospectus is part of a registration statement on Form S-1 that we filed with the SEC using a “shelf” registration or continuous offering process. Under this process, the Registered Stockholders may, from time to time, sell the common stock covered by this prospectus in the manner described in the section titled “Plan of Distribution.” Additionally, we may provide a prospectus supplement to add information to, or update or change information contained in, this prospectus, including the section titled “Plan of Distribution.” You may obtain this information without charge by following the instructions under the section titled “Where You Can Find Additional Information” appearing elsewhere in this prospectus. You should read this prospectus and any prospectus supplement before deciding to invest in our common stock.

As of April 17, 2023, we have a total of 42,522,091 shares of our common stock issued and outstanding.

Certain amounts, percentages, and other figures presented in this prospectus have been subject to rounding adjustments. Accordingly, figures shown as totals, dollars, or percentage amounts of changes may not represent the arithmetic summation or calculation of the figures that precede them.

PROSPECTUS SUMMARY

This prospectus summary highlights certain information contained elsewhere in this prospectus. As this is a summary, it does not contain all of the information that you should consider in making an investment decision. You should read the entire prospectus carefully, including the information under the sections entitled “Risk Factors,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our financial statements and the related notes thereto included in this prospectus, before investing. This prospectus includes forward-looking statements that involve risks and uncertainties. See “Information Regarding Forward-Looking Statements.” Unless the context otherwise requires, we use the terms “reAlpha,” the “Company,” “we,” “us” and “our” in this prospectus to refer to reAlpha Tech Corp. and any and all of our subsidiaries.

Overview

We are an early stage company with a mission to develop and utilize our artificial intelligence focused technology stack to empower retail investor participation in short-term rental properties, which are real estate units listed for a rental term of 31 days or less. People may use vacation rentals for a variety of reasons including, but not limited to: vacation or travel, relocation for an upcoming move, a place to stay while their residence is going through renovations or repairs, extended work trips, special events like weddings or family reunions, temporary work assignments, or seasonal activities. We were founded on the belief that every person should have the access and the freedom to pursue wealth creation through real estate. However, there are significant barriers to entry for the average individual and lucrative returns are currently mainly realized by private equity firms and larger-scale developers. We intend to leverage technology to democratize access to short-term rental investments. To support this goal, we intend to build what we believe would be a new model for property ownership and real estate investment. We believe in simplified wealth creation, access to new markets, diversification, exceptional guest experiences, and community-building network effects.

Our Business Model

Our business model is built around providing retail investors with the opportunity to participate in short-term rental properties we will acquire by offering interest in each property portfolio. We intend to make that opportunity available pursuant to exempt offerings directed at those retail investors through syndications, which investors we call “Syndicate Members,” as described below. We are focusing on the short term rental industry since it is highly fragmented and is ideal for consolidation from both a real estate and technology and artificial intelligence perspective. According to public filings from Airbnb, Inc. (“Airbnb”), the total market size is estimated to be $1.2T.

The Company decided to focus on short-term rentals (vs. long term rentals) because of their profitability. We believe short-term rentals can be more profitable than long-term rentals for three main reasons:

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Higher rental rates. Short-term rental rates are typically higher than long-term rental rates, especially in popular tourist destinations or during peak travel seasons.

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Flexibility. With short-term rentals, you have the flexibility to adjust your rental rates and availability based on demand.

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More tax deductions. Short-term rental owners may be able to deduct more expenses than long-term rental owners, such as cleaning fees, supplies, and utilities.

To implement our business model, we plan to acquire properties that satisfy our internal Investment Criteria (as defined below) (the “Target Properties”). Then, if needed, we renovate the Target Properties, prepare them for rent, list them on short-term rental sites and arrange for the Target Properties to be managed, internally or through third-parties. Eventually, we expect such management of the Target Properties will be beneficial for the Company as well as the investors that acquire minority interests through syndications (or through a real estate investment trust, as applicable). We expect that in the future these investors will become Syndicate Members through the purchasing of minority interests in our acquired properties. In addition to managing the property operations, whether internally or through third-parties, we will also manage the financial performance of the asset, such as evaluating if the after-repair value or appreciated value of the property is higher than the purchase price, or whether the property is ready to generate the expected profitability. At this time, we started our first syndication of one of our Orlando properties.

The average person does not:		Proposed solution:
Have access to wholesale real-estate market prices.		As a bulk buyer, we will have access to the wholesale real estate market, which most people do not even know exists. This includes bulk portfolio acquisition strategy.

Have the cash for a 25% down payment.		reAlpha has strategic partnerships with lending institutions, which will allow us to close on property acquisitions within two to three weeks rather than the two to three months customary period for property acquisitions.

Have the time to buy, renovate and manage an investment property.		reAlpha handles the acquisition, renovation, onboarding and property management. Syndicate Members never have to answer a guest or pick up a paintbrush.

Want to deal with a complex mortgage process (personal guarantee, negotiation with lenders, personal credit checks).		reAlpha eliminates the entire process for Syndicate Members. Syndicate Members will never need to give a personal guarantee and their credit will never be checked when financing directly through reAlpha.

Qualification + Mortgage Lending Restrictions - Income determines how much an individual can leverage/borrow.		By fractionalizing the ownership process, we expect reAlpha Syndicate Members can own a smaller percentage of a home or group of homes rather than covering an entire down payment and being required to go through loan qualification requirements required by lenders.

Through these property acquisition investments, our goal is to obtain: (i) consistent cash flow from short-term tenants; (ii) long-term capital appreciation by leveraging our property’s value after repair and/or renovations in appreciating markets; and (iii) favorable tax treatment of long-term capital gains.

To finance these property acquisition investments, we may engage in leverage financing to enhance total returns to our Syndicate Members and investors through a combination of senior financing on our real estate acquisitions, secured facilities, and capital markets financing transactions. We will seek to secure conservatively structured leverage that is long-term, non-recourse, non-mark-to-market financing to the extent obtainable on a cost-effective basis. Our operating policies in respect to credit risk and interest rate risk we may face in connection with these financings include:

Credit Risk Management. We may be exposed to various levels of credit and special hazard risk depending on the nature of our assets. We will review and monitor credit risk and other risks of loss associated with each investment and our overall credit risk and levels of provision for loss.

Interest Rate Risk Management. We will follow an interest rate risk management policy intended to mitigate the negative effects of major interest rate changes. We intend to minimize our interest rate risk from borrowings by attempting to “match-fund,” which means that we will seek to structure the key terms of our borrowings to generally correspond with the expected holding period of our assets.

Syndicate Member Exempt Offerings

To implement our business model, we will purchase Target Properties, as described below, through wholly-owned LLCs that will be formed for each property or group of related properties that are ready to be listed on short term rental sites (as described below in “Business - Business Process for Acquired Properties” below). We expect to utilize a credit line to facilitate funding and acquisition of Target Properties. As we grow and develop additional funding sources, we may set up additional subsidiaries to further facilitate funding and credit opportunities available to us through each of these additional subsidiaries (for more information on our most recent credit facility agreement, refer to the “Recent Developments” section below).

During 2023, we started to offer securities to Syndicate Members via a SEC registered broker-dealer managed process under Section 4(a)(6) of the Securities Act, or directly by the issuer under Section 4(a)(2) of the Securities Act and/or Regulation D, where only accredited investors are involved. As we transition from properties that have been placed in the market utilizing lines of credit or short-term financing to long-term funding and syndicate membership, we may restructure our holdings. Specifically, we may refinance our property holdings with different lenders that may offer better financing terms after the property has between 3 to 6 months of operation history.

However, we expect reAlpha Acquisitions, LLC, one of our subsidiaries, will maintain management control of each of the LLCs. When this phase is implemented, we expect Syndicate Members to collectively buy up to 100% of the newly formed LLC. The offerings by the LLCs of Syndicate Membership will be made after the completion of this Direct Listing, pursuant to Securities and Exchange Commission Regulation A, Regulation Crowdfunding, Regulation CF or Regulation D, all of which we believe would be available for such offerings and facilitate the utilization of exemptions from registration under federal and state securities laws (see “Recent Developments - First Syndication of the Jasmine property” for more details on our most recent Syndicate Member offering).

Our Growth Strategy

Our business and growth strategy consists of acquiring Target Properties through the use of our credit facilities, furnish, lightly renovate, if needed, and rent them on the short-term rental market. We will manage, selectively leverage and sell homes located in markets that satisfy our market selection requirements across the United States, as further described below. In the future, we may consider expanding to other favorable global markets. We believe that these markets should offer investors a blend of attractive yields and a prospect for long-term property value appreciation.

Market Selection

We intend to focus our business efforts on the markets in which Airbnb operates, which include some or all of the following characteristics:

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Sufficient inventory to make it feasible to achieve scale in the local market (100 – 500 homes);

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Large universities and skilled workforce;

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Popular with Airbnb travelers;

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Favorable competitive landscape with respect to other institutional residence buyers; and

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Hotel room capacity and occupancy rates in given destinations.

During our testing phase, we started acquiring properties in our initial geographic market of Dallas, Texas as a proof of concept. Now, we have discontinued our Dallas operations by selling any properties we previously had in that market, and moved into the Orlando, Florida market. We believe that this market offers strong growth in population, jobs, rental rates, and value appreciation. Additionally, we have selected Tampa, Ft. Lauderdale, and Panhandle areas in Florida as our next markets.

We will focus on acquiring properties we believe (i) are likely to generate stable cash flows in the short-term rental market and/or (ii) have the potential for long-term capital appreciation, such as those located in neighborhoods with what we see as high growth potential and those available from sellers who are distressed or face time-sensitive deadlines. As a result of the extended time to complete the renovation of properties caused by the current supply chain issues, including labor, material, and furniture shortages, we have shifted the focus of our acquisition strategy to rent-ready homes. This will help us to deploy the properties that we purchase to be onboarded on Airbnb and start generating revenues more quickly as these rent-ready properties do not need any major upgrades. In the future, we may revisit purchasing renovation heavy homes depending on the labor and supply availabilities.

We expect to revisit market statistics and market selection criteria on a periodic basis. Selected markets may not necessarily meet every single criterion. In the future, we may choose to enter additional markets such as Florida, California, Texas, New York, Illinois and, eventually, we expect that will expand to other states in the U.S., and subsequently globally. At this time, we have not set a timeline for expansion. We may also evaluate certain additional markets in the future.

Investment Criteria

We determine our Target Properties utilizing our investment criteria, which evaluates acquisition investments using our proprietary algorithms (the “Investment Criteria”). Investment decisions made pursuant to our Investment Criteria may include single-family homes, multifamily units, experiential properties, resorts, resort communities and others.

We plan to have continuously assess property acquisition investments using our Investment Criteria and intend to purchase properties that include, but are not limited to, the following primary characteristics:

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Target Properties identified by our reAlpha Score algorithms (described below) are considered for acquisition;

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Target Properties with an average of three (3) bedrooms and two (2) bathrooms per unit;

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Target Properties with an average price range of $250,000 - $600,000 and a repair/improvement budget requirement of less than 20% of the home purchase price; In select markets, this price range may significantly vary.

We also intend to regularly consider acquiring properties outside of these ranges depending on market conditions, uniqueness, and condition of the Target Property.

Investment Decisions

While we will employ our proprietary technology and our real estate professionals to identify suitable properties for acquisition, the Company will be responsible for final decisions. We will use the methodology described below and our bespoke technologies to reach buy or sell decisions. We have developed an investment approach that combines the experience of our management, the reAlpha Score and an approach that emphasizes market research, underwriting standards and down-side analysis of the risks of each investment.

To execute our disciplined investment approach, we plan to closely monitor the profit and loss of each investment.

The following is a summary of our methodology for property acquisition:

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Local Market Research. We will research the acquisition and underwriting of each transaction. The research will focus on finding any “red flags” to acquire a property. These “red flags” include (i) heavy regulation on short-term rentals at a state, county, or homeowner’s association (“HOA”) level; (ii) homes that have been on the market for longer than a year, or (iii) areas where natural disasters are extremely common and damaging. Additionally, we consider things such as tourist numbers and market size, seasonality, walkability, proximity to airports, restaurants and entertainment and events that would attract renters.

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Underwriting Discipline. We will examine all elements of a potential investment, including, with respect to real property, its location, income-producing capacity, prospects for long-range appreciation, tax considerations and liquidity.

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Risk Management. Operating or performance risks generally arise at the investment level and often require real estate operating experience to cure, as described in the “Risk Factors” section below. We will review the current operating performance of property investments against our internal projections and provide the oversight necessary to detect and resolve issues as they arise.

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Asset Management. Prior to the purchase of a property, we will develop a property business strategy, which will be customized based on the acquisition and underwriting data. Our property business strategy is a forecast of the action items to be taken and the capital needed to achieve the targeted returns for a Target Property. The property business strategy includes: (i) offer amount and negotiations, (ii) financing structure, (iii) furniture and design, (iv) achieving the most beneficial holding period for the property, (v) tax strategy and (vi) exit strategy. These strategies will be customized based on data found during the due diligence process for each of Target Property to adapt to economic conditions, seasonality, and the unique factors of each market.

Business Process for Acquired Properties

Once we have decided to acquire a property using our Investment Criteria, we intend to use the following steps to maximize its value:

A wholly-owned subsidiary (e.g. wholly-owned LLCs) buys the Target Property using short-term leverage provided by one of our lending partners.

The wholly-owned subsidiary arranges for the renovation of the purchased Target Property, at the cost of that wholly-owned subsidiary, by one of our preselected national partners after transferring it to the new reAlpha LLC subsidiary.

Within a period of 4-to-18-months, reAlpha will refinance the Target Property by swapping the short-term loan with a long-term loan from any one of our lending partners. If current market conditions or lending opportunities are poor, we may choose to not refinance or refinance out of the respective target time frame of 4-to-18 months.

If the after-repair value or appreciated value (within 4 to 18 months after acquisition) of the Target Property is higher than the purchase price, then the remaining money from the equity may be used for purchasing additional properties in the same reAlpha LLC subsidiary for all owners.

The new reAlpha LLC subsidiary will offer up to 100% of its membership interests for purchase through syndicate membership (or other investment vehicle such as real estate investment trust), as explained above.

Our Syndicate Members may receive distributions proportional to their membership based on the free cash flows after taxes from the overall performance of the property on Airbnb.

After the Target Property has generated the target returns the property may be sold to book the profit for the reAlpha LLC subsidiary.

This profit, if any, may be used to purchase further properties in the same reAlpha LLC subsidiary for our benefit and the benefit of the Syndicate Members. The Syndicate Members may choose to invest further in new properties or redeem their investments.

Although we may sell properties, we intend to hold and manage the properties we acquire for a period of one to six years. The reAlpha LLCs that will manage these properties will receive a gross fee of 15% to 30% of the property’s revenue. The 15-30% fee is of gross receipts generated by the property. “Gross Receipts” means (i) receipts from the short-term or long-term rental of the property; (ii) receipts from rental escalations, late charges and/or cancellation fees; (iii) receipts from tenants for reimbursable operating expenses; (iv) receipts from concessions granted or goods or services provided in connection with the Property or to the tenants or prospective tenants; (v) other miscellaneous operating receipts; and (vi) proceeds from rent or business interruption insurance, excluding (A) tenants’ security or damage deposits until the same are forfeited by the person making such deposits, (B) property damage insurance proceeds, and (C) any award or payment made by any governmental authority in connection with the exercise of any right of eminent domain.

As each of our properties reaches what we believe to be its appropriate disposition value, based on internal metrics, we will consider disposing of the property. The determination of when a particular property should be sold or otherwise disposed of will be made after consideration of relevant factors, including prevailing and projected economic conditions, whether the value of the property is anticipated to appreciate or decline substantially, and how any existing leases on a property may impact the potential sales price. The Company will utilize the reAlpha Score to measure properties against set key performance indexes and determine when to objectively dispose of a property. The Company may determine that it is in the best interests of stockholders to sell a property earlier than one year or to hold a property for more than six years. When we determine to sell a particular property, we intend to achieve a selling price that captures the capital appreciation for investors based on then-current market conditions. We cannot assure you that this objective will be realized.

Each property will be charged a market rate property disposition fee that are paid by the seller at the time of the sale, consisted of realtor fees and closing costs (taxes and other related costs). This disposition fee should cover property sale expenses such as brokerage commissions, and title, escrow and closing costs upon the disposition and sale of a property. It is expected that this disposition fee charged will range from 6% to 8% of the property sale price. Following the sale of a property, the Company expects to re-invest the proceeds of such sale, minus the property disposition fee described in this paragraph, into more properties for our portfolio and for the Syndicate Members to have the opportunity to invest in.

Further, the properties may be also managed by third-party property management firms at the Company’s discretion. The services provided by such third-party property manager would include (i) ensuring compliance with local and other applicable laws and regulations; (ii) handling tenant access to properties; (iii) and any other action deemed necessary by the property manager or desirable for the performance of any of the services under our respective management agreement. These management agreements are subject to an asset management fee between 15% and 30% of the short-term rental gross revenue generated. As we achieve scale in the number of properties owned and operated, we may seek to bring property management in-house. In the event we manage a property, such property management fees would then be retained by us. If a short-term rental property is vacant and not producing rental income, the property management fee will not be paid during any such period of vacancy, including properties managed by third-parties.

The operating expenses that each reAlpha LLC will be responsible for, as described above, include, but is not limited to: (i) mortgage principal and interest; (ii) property tax; (iii) homeowner insurance; (iv) utilities; (v) landscaping; (vi) pool maintenance costs; (vii) routine maintenance and repairs; (viii) HOA fees; and (ix) pest control. We will share the expenses related to the short-term rental properties with the Syndicate Members and will bear its own operating and management expenses in proportion to the ownership of the LLC.

Our Platform and Technologies

reAlpha App (Trademarked as reAlpha M3^TM)

The reAlpha App is a mobile application we are developing, which, when operational, will allow Syndicate Members to view live the financial metrics and performance of properties they have invested in. Just as you may monitor your stock portfolio and performance on an app like Robinhood, the reAlpha App will give Syndicate Members real-time visibility into their property asset portfolio and performance.

The reAlpha App is being designed to support our mission to make real estate ownership accessible and user friendly. When operational, it will fetch property listing data as well as data on short-term rental market trends from multiple third party API providers and display the consolidated data for a particular property in an easily accessible format. The reAlpha app will be a broker-dealer managed marketplace that our Syndicate Members will be able to utilize with ease.

reAlpha HUMINT^TM

In addition to the artificial intelligence (“AI”) being utilized in our technologies, we added a human factor that analyzes the short-term rental profitability. Qualitative features depend on human analysis and cannot be fetched automatically. That is why we will utilize both internal analysts at reAlpha and freelance analysts.

The reAlpha HUMINT app allows property analysts to analyze the property and provide the missing property features together with an estimated reAlpha score. This is used as feedback to improve reAlpha BRAIN AI.

BnBGPT

BnBGPT is a product that simplifies the process of generating personalized and effective home descriptions. The app is designed for both realtors and hosts, with features that help them save time and money while creating descriptions that stand out in a crowded market. Our GPT powered app for real estate is an essential tool for anyone looking to leave a mark in the real estate industry. By harnessing the power of AI, our app ensures that each description is personalized and effective, giving users a competitive edge in the marketplace.

For Realtors. Our app will offer a feature that generates advertising content directly from uploaded images and they can be used by realtors to advertise their properties, eliminating the need for professional copywriters and other costly marketing tools. This makes it easy for realtors to create descriptions that truly capture the essence of a home and highlight its unique features and benefits.

For Hosts. Our app will offer features that simplify the process of creating descriptions for Airbnb, VRBO, and Booking.com listings. Our app will automatically organize these descriptions into sections, making it easy to highlight key features of a space and provide important information about guest access. Additionally, we will include the proximity data of attractions near the property (e.g., restaurants, museums, areas of interest for tourists in the area and others), making it easier to highlight those for the host. This helps hosts spend less time writing descriptions and more time focusing on providing a great guest experience.

Competition and Competitive Strengths

We face competition from different sources in our primary activity of acquiring properties. We believe our competitors in acquiring properties for investment purposes are individual investors, small private investment partnerships looking for one-off acquisitions of investment properties that can either be leased or restored and sold, and larger investors, including private equity funds and other REITs, that are seeking to capitalize on the same market opportunity that we have identified. Our primary competitors in acquiring portfolios include large and small private equity investors, public and private REITs, and other sizable private institutional investors. These same competitors may also compete with us for investors. Competition may increase the prices for properties that we would like to purchase, reduce the amount of rent we may charge for our properties, reduce the occupancy of our portfolio, and adversely impact our ability to achieve attractive total returns. We also face competition from other real estate platform companies such as Roofstock, Inc., Fundrise LLC, Invitation Homes, Pacaso, as well as a range of emerging new entrants. There are a number of established and emerging competitors in the real estate platform market. The market is fragmented, rapidly evolving, competitive, and with relatively low barriers to entry.

Although our competitors may be more established and better funded than we are, we believe that our acquisition platform, Investment Criteria, extensive in-market property operations infrastructure, and local expertise in our markets provide us with competitive advantages. We consider our competitive differentiators in our market to primarily be:

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our focus on the short-term rental market, compared to other established players in the industry that focus on long-term rentals;

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Syndicate Member rewards program that allows for utilization of properties when they are unoccupied, which is currently being developed;

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consistent short-term rental income with use of optimum amounts of leverage;

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our proprietary technology to make objective and strategic investments in property and market selection;

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lower minimum investment amounts; and

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favorable tax treatment associated with long-term capital gains.

Intellectual Property

The Company is currently developing four technologies. However, this is only part of our technology roadmap. We strive to continue innovating for our benefit and for the benefit of our Syndicate Members by using better wealth-creation tools, as well as generating returns by leveraging new technologies to optimize guest experience.

reAlpha BRAIN^TM& reAlpha Score*

*	Patent applied

The reAlpha BRAIN^TMwill bring machine learning (“ML”) and AI to the world of short-term rental investment. This platform will utilize a natural language processing (“NLP”) program to scan through large quantities of data regarding properties and ML algorithms to choose the properties that have higher than expected industry standard return on investment. For this, it will gather and integrate a variety of data relevant to the properties from multiple sources including wholesalers, various multiple listing service (“MLS”) data sources, realtors, small Airbnb “mom and pop” operators, and other larger property owners. For instance, it will collect data on the properties’ price, house structure and sale history from different MLS’ listings in the U.S. This data, combined with the information about the neighborhood appeal, accessibility and safety of the neighborhood surrounding the properties enables the algorithm to learn the hidden patterns underlying high return short-term rental investments. This will allow reAlpha to predict how likely a particular property will generate expected profitability. The platform will convey this knowledge by assigning each property with a “reAlpha Score” ranging from 0-100. The higher the value, the more favorable a property is for investment.

Currently, the process of analyzing a property as a potential investment typically begins with an email received from real-estate agent’s distribution list to which reAlpha has subscribed. However, we use multiple other sources outside of inbound emails to identify properties. In the email scenario, the reAlpha BRAIN^TM will include an AI email parser based on NLP that looks for the property of concern within the unstructured email and extracts its street address. This address will then be used to query various data providers for a detailed description of the property’s structure, neighborhood and finances. This ML model, which is being built and will be hosted on the Amazon Sagemaker platform provided by Amazon Web Services (“AWS”), will then calculate the reAlpha Score for that property.

The model will also continuously improve and learns over time. As the Company makes its decision to invest in properties, the model will check the effectiveness of its recommendations to reduce false positives and false negatives. As of April 2023, the reAlpha BRAIN has analyzed over 1,500,000 homes.

Recent Developments

Regulation A Offering

We completed our Regulation A+ offering on January 19, 2022, and we raised $8,555,370 as a result of that offering as of January 31, 2023.

reAlpha Acquisitions Churchill, LLC

reAlpha Acquisitions Churchill, LLC, a wholly-owned subsidiary of the Company was formed on May 17, 2022, to hold properties acquired and utilizing financing provided by Churchill Finance I, LLC. reAlpha Acquisitions Churchill, LLC, executed a master credit facility worth up to $200 million on August 18, 2022. This credit facility allows a loan-to-cost ratio of up to 80% and is at a fixed rate of 12%. Access to this credit facility will allow us to acquire properties with the intention of utilizing them as short-term rental properties.

reAlpha Realty, LLC

We have also formed an in-house brokerage, reAlpha Realty, LLC, a subsidiary of reAlpha Asset Management, Inc. (DBA reAlpha Homes) on September 12, 2022. reAlpha Realty, LLC operates out of a new office in Miramar, Florida, reAlpha Realty is led by Designated Broker Jorge Aldecoa, who also serves as President of reAlpha Homes.

Tree Houses Partnership

In July 2022, we also signed a partnership with Free Spirit Spheres, a developer of tree houses that can be used for short-term rental. We intend to utilize this partnership for the development of tree houses in the United States for short-term rental to allow guests unique experiences consistent with our brand development strategy.

reAlpha Homes and SAIML Capital Pte. Limited

On November 17, 2022, reAlpha Homes and SAIML Capital Pte. Limited, a Singapore-based asset management firm, signed a binding term sheet to form a joint venture to invest $40.8 million in equity in rent-ready short-term rental (“STR”) properties. Balaji Swaminathan, who was appointed as a member of our board of directors in April 2023, is the Chief Executive Officer and director of SAIML Capital Pte. Limited. The joint venture, once formed, would have a 51% stake held by reAlpha Homes and a 49% stake held by SAIML. The joint venture planned to make up to $200 million in investments across California, Arizona, Florida, and Tennessee, leveraging the reAlphaBRAIN to identify properties that meet its investment criteria pursuant to the terms and conditions of a definitive joint venture agreement to be entered into on or before January 31, 2023. This joint venture may have also expanded its partnership by contributing an additional $61.2 million of equity, with the potential to invest up to $500 million in STR properties through additional debt financing. As of the date hereof, the definitive joint venture agreement has not been entered into and, therefore, this joint venture has not been formed. Mr. Swaminathan received no compensation under the term sheet while it was outstanding.

GEM Global Yield LLC Capital Commitment

On December 1, 2022, reAlpha Homes entered into an agreement with GEM Global Yield LLC SCS (“GEM”) a Luxembourg-based private alternative investment group, for a $100 million capital commitment, which includes a share subscription facility of up to $100 million for a 36-month term following a public listing by reAlpha Tech Corp. (the “GEM Agreement”). The Company will have control in terms of timing and, within certain limits, the maximum amount of each individual drawdown. There is no minimum drawdown obligation.

Pursuant to the GEM Agreement, the Company can issue a Draw Down Notice (“Draw Down Notice”) at any time (the “Draw Down”), which will trigger the commencement of a Pricing Period (“Pricing Period”). The Pricing Period will last for the following thirty (30) consecutive trading days, and the Draw Down will close on the first trading day following the end of the Pricing Period. GEM will honor Draw Down Notices from the Company based upon a per-share subscription price equal to ninety percent (90%) of the average closing bid price during the Pricing Period (“Purchase Price”).

If ninety percent (90%) of the closing bid price on a given pricing period amount is less than the threshold price (or floor price) set by the Company (the “Threshold Price”), then the Investor’s payment obligation under the Draw Down will be reduced by 1/30th, and the closing bid price for that day will not be factored into the Purchase Price calculation. The Threshold Price will be set prior to using this facility. For each Draw Down, the Company may issue a Draw Down Notice for up to four hundred percent (400%) of the average daily trading volume for the Pricing Period.

First Syndication of the Jasmine property

In March 2023, we opened our first Regulation CF offering listed under reAlpha 612 Jasmine Lane Inc. where we are completing our first syndication through our initial public offering platform, whereby we offered to investors the opportunity to buy fractional minority interest in our property. The minimum offering amount is $388,639 and the maximum is $614,036.50, inclusive of investor payment processing fees. The offering is selling shares of the company which owns the property 612 Jasmine Lane, Davenport, FL 33897. The minimum investment is $500 plus the 2.5% investor transaction fee. We have raised $323,600 as a result of this Regulation CF offering, and we expect it to be concluded on or around June 30, 2023.

reAlpha Asset Management Inc. merges with reAlpha Tech Corp

On March 21, 2023 (the “Effective Time”), reAlpha Tech Corp. (the “Parent”), merged with and into reAlpha Asset Management, Inc. (the “Subsidiary”), pursuant to a short-form merger in accordance with Section 253 of the Delaware General Corporate Law (“DGCL”) (the “Downstream Merger”), with the Subsidiary surviving the Merger (the “Surviving Corporation”). This Downstream Merger has resulted in reAlpha Asset Management, Inc. gaining access to all of the technologies and intellectual property owned by reAlpha Tech Corp.

Prior to the Downstream Merger, the Parent owned more than 90% of the issued and outstanding shares of common stock of the Subsidiary. As of the Effective Time, by virtue of the Downstream Merger and without any action on the part of the Parent, Subsidiary or Surviving Corporation, each share of the Subsidiary’s common stock issued and outstanding immediately prior to the Effective Time (other than shares of the Subsidiary common stock that were cancelled, as described below) were automatically converted into one validly issued, fully paid and nonassessable share of common stock of the Surviving Corporation. Further, each share of the Subsidiary’s common stock issued and outstanding immediately prior to the Effective Time that was held by the Parent or the Subsidiary (as treasury stock or otherwise) was automatically cancelled and returned to the status of authorized but unissued shares of the Subsidiary. And, lastly, as of the Effective Time, all of the shares of common stock of the Parent issued and outstanding immediately prior to the consummation of the Merger were automatically converted into a number of shares of common stock of the Surviving Corporation, pro-rated for the number of shares of the Subsidiary’s common stock held by the Parent at such time.

The Downstream Merger has resulted in the Company gaining ownership of a 25% stake in Naamche Inc., an artificial intelligence (“AI”) studio, and a 25% stake Carthagos Inc., a design and branding studio. Naamche, Inc. has assisted us in research and development of our proprietary algorithms and other technologies (see “Research and Development” section below for more details). Carthagos Inc. is a design and branding studio that the Company acquired for marketing purposes (see “Sales and Marketing” section below for more details). This acquisition is expected to enhance our technological capabilities, broaden its portfolio of services, and contribute towards cost savings, positioning them for growth and success in the future.

This development is significant as it will enable reAlpha AMI to further enhance its offerings and provide customers with a broader range of AI solutions. With access to reAlpha Tech Corp's advanced technologies and IPs, reAlpha AMI can now offer more comprehensive solutions that cater to a wider range of industries and use cases.

reAlpha Asset Management Inc. changes names to reAlpha Tech Corp

In connection with the Downstream Merger, on March 21, 2023 reAlpha Asset Management Inc. changed its name to reAlpha Tech Corp. This development reflects the company's evolution and expansion beyond asset management into broader areas of financial technology and innovation.

The name change to reAlpha Tech Corp. is not just a cosmetic rebranding, but rather a strategic move that reflects the company's broader focus on delivering cutting-edge solutions across a wider range of property management and financial services. The company's new name highlights its commitment to leveraging advanced technologies, including artificial intelligence and machine learning, to deliver innovative solutions to clients.

Overall, the name change to reAlpha Inc. is a significant development that underscores the company's commitment to growth, innovation, and delivering exceptional value to its clients.

For additional information on recent developments, please see the discussion in “Legal Proceedings” below.

Rhove Acquisition

On March 24, 2023, the Company acquired Roost Enterprises, Inc. (“Rhove”), a leading provider of real estate technology solutions. The Rhove acquisition includes technology developed for the purpose of syndicating real estate properties for investment by retail and institutional investors (the “Syndication Platform”). Pursuant to the Stock Purchase Agreement entered into in connection with the Rhove acquisition (the “Stock Purchase Agreement”) among the Company, Rhove and certain investor sellers in Rhove (the “Sellers”), we acquired all the intellectual property related to the Syndication Platform and other related intangible property and proprietary information of Rhove.

The purchase price under the Stock Purchase Agreement for the Rhove acquisition includes: (1) payment to Silicon Valley Bridge Bank, N.A. (“SVBB”), of $25,000 in cash and the issuance of 49,029 shares of our common stock (collectively the “SVBB Consideration”), (2) 1,263,000 shares of our for Sellers and the issuance of option letters to Sellers (on a pro rata basis) to purchase in aggregate 1,263,000 shares of our common stock for $10.00 per share with an expiration date of two years from the date of issuance; and (3) payment of certain transaction expenses of Rhove totaling $50,000.

As part of the transaction, Rhove’s major investor, Drive Capital and certain of its funds, became investors of reAlpha. As of the date of acquisition, Rhove has over 5,000 users that will join the reAlpha ecosystem. As part of the transaction, Calvin Cooper, the CEO of Rhove, will join reAlpha in an advisory role. Calvin brings a wealth of knowledge, connections, and resources in the real estate fractionalization space.

Rhove's innovative platform will enhance reAlpha's capabilities and enable us to offer a more seamless and efficient real estate investment experience to our clients. With Rhove's technology, we will be able to provide our clients with access to real estate investment opportunities and manage their investments through a user-friendly platform. Rhove's platform also offers unique features such as the ability to earn rent rewards, making real estate investing more accessible and rewarding.

We believe that this acquisition will help us continue to innovate and deliver value to our clients, and we look forward to leveraging Rhove's technology to drive the future of real estate investing.

Management Changes

On April 11, 2023, the Company entered into an employment agreement with Jorge Aldecoa to act as the Company’s Chief Operating Officer, replacing Michael J. Logozzo as interim Chief Operating Officer. Pursuant to Mr. Aldecoa’s employment agreement, he will serve as the Company’s Chief Operating Officer until his agreement is terminated by either Mr. Aldecoa or the Company, and he will receive a yearly salary of $200,000 for the fiscal year ended April 30, 2023 and a pro-rated amount of such base salary for the year ended April 30, 2022.

Mr. Aldecoa’s employment agreement also provides for a base salary adjustment to of $215,000 upon a successful follow-on offering of the Company’s securities for an amount of $8 million or more, subject to the compensation committee’s approval. Further, Mr. Aldecoa is entitled to additional compensation in the form of a discretionary bonus of up to $50,000 based on the achievement of certain established performance targets, which is payable annually, and certain benefits such as unlimited vacation, health insurance and others. Further, Mr. Aldecoa is eligible to participate in the Plan (as defined below). Mr. Aldecoa or the Company may terminate the employment agreement at any time upon written notice to the other party. Mr. Aldecoa’s employment agreement has a confidentiality provision and a non-compete for a period of two (2) years following the termination of his employment.

Controlled Company

A controlled company is a company of which more than 50% of the voting power for the election of directors is held by an individual, a group or another company. We are a controlled company because Mr. Giri Devanur, our Chief Executive Officer and Chairman, holds more than 50% of our voting power, and we expect we will continue to be a controlled company upon the Direct Listing. For so long as we remain a controlled company, we are exempt from the obligation to comply with certain Nasdaq corporate governance requirements, including:

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our board of directors is not required to be comprised of a majority of independent directors.

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our board of directors is not subject to the compensation committee requirement; and

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we are not subject to the requirements that director nominees be selected either by the independent directors or a nomination committee comprised solely of independent directors.

The controlled company exemptions do not apply to the audit committee requirement or the requirement for executive sessions of independent directors. We are required to disclose in our annual report that we are a controlled company and the basis for that determination. Although we do not plan to take advantage of the exemptions provided to controlled companies, we may in the future take advantage of such exemptions.

Selected Risks Associated with Our Business

Investing in our common stock involves a high degree of risk. You should carefully consider all the information in this prospectus prior to investing in our common stock. These risks are discussed more fully in the section entitled “Risk Factors” immediately following this prospectus summary. These risks and uncertainties include, but are not limited to, the following:

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We are employing a business model with a limited track record, which makes our business difficult to evaluate.

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Our technology that is currently being developed may not yield expected results or be delivered on time.

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We intend to utilize a significant amount of indebtedness in the operation of our business.

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A significant portion of our portfolio properties’ costs and expenses are fixed and we may not be able to adapt our cost structure to offset declines in our revenue.

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Our ability to retain our executive officers and other key personnel of our advisors and their affiliates;

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Global economic, political and market conditions and economic uncertainty caused by the recent outbreak of coronavirus (COVID-19) may adversely affect our business, results of operations and financial condition.

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Our investments are and will continue to be concentrated in certain markets and in the single-family properties sector of the real estate industry, thus, exposing us to risk concentrations, which, in turn, exposes us to risk caused by seasonal fluctuations in short-term rental demand and downturns in certain markets or in the single-family properties sector.

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Contingent or unknown liabilities could adversely affect our financial condition, cash flows and operating results.

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We are subject to certain risks associated with bulk portfolio acquisitions and dispositions.

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Availability of appropriate property acquisition targets;

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Our dependence upon third parties for key services may have an adverse effect on our operating results or reputation if the third parties fail to perform.

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We face significant competition in the short-term rental market for guests, which may limit our ability to short-term rent our properties on favorable terms.

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Compliance with governmental laws, regulations and covenants that are applicable to our properties or that may be passed in the future, including permit, license and zoning requirements, may adversely affect our ability to make future acquisitions or renovations, result in significant costs or delays, and adversely affect our growth strategy.

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Failure to integrate any acquisitions successfully.

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Our business is subject to laws and regulations regarding privacy, data protection, consumer protection, and other matters. Many of these laws and regulations are subject to change and uncertain interpretation, and could result in claims, changes to our business practices, monetary penalties, or otherwise harm our business.

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We may not be able to attract investors to invest in our portfolio properties.

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If we fail to attract guests, or if we fail to provide high-quality stays and experiences, our business, results of operations, and financial condition would be materially adversely affected.

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If we fail to retain guests or add new guests, our business, results of operations, and financial condition would be materially adversely affected.

Corporate Information and Incorporation

reAlpha Tech Corp. (previously reAlpha Asset Management, Inc.) is a Delaware corporation formed in April 2021 (the “Company,” “reAlpha,” “we,” “our,” or “us”). On March 21, 2023, we changed our name to reAlpha Tech Corp, following our Downstream Merger (as defined above).

reAlpha Acquisitions Churchill, LLC, a wholly-owned subsidiary of the Company was formed on May 17, 2022, to hold properties acquired and utilizing financing provided by Churchill Finance I, LLC. reAlpha Acquisitions Churchill, LLC, executed a master credit facility worth up to $200 million on August 18, 2022. This credit facility allows a loan-to-cost ratio of up to 80% and is at a fixed rate of 12%. Access to this credit facility will allow reAlpha to acquire properties with the intention of utilizing them as short-term rental properties.

We have also formed an in-house brokerage, reAlpha Realty, LLC, a subsidiary of the Company (DBA reAlpha Homes) on September 12, 2022. reAlpha Realty, LLC operates out of a new office in Miramar, Florida, reAlpha Realty is led by Designated Broker Jorge Aldecoa, who also serves as our Chief Operating Officer.

Our principal executive office is located at 6515 Longshore Loop, Suite 100, Dublin, OH 43107. Our phone number is (707) 732-5742. Our corporate website is located at www.realpha.com. Information on our website is not part of this prospectus.

An investment in our shares of common stock involves significant risks. Before making an investment in our shares of common stock, you should carefully consider the risks and uncertainties discussed below under “Information Regarding Forward-Looking Statements,” and the specific risks set forth herein. Any of the following risks could have a material adverse effect on our business, financial condition and results of operations. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial may also materially and adversely affect our business, prospects, financial condition, results of operations, cash flows and ability to pay dividends. In any such case, the market price of our shares of common stock could decline, and you may lose all or part of your investment.

We have a limited operating history and may not be able to operate our business successfully or generate sufficient cash flows to accomplish our business objectives.

We have a limited operating history. As a result, an investment in our common stock entails more risk than an investment in the common stock of a company with a substantial operating history. If we are unable to operate our business successfully, you could lose all or a portion of your investment in our common stock. Our ability to successfully operate our business and implement our operating policies and investment strategy depends on many factors, including:

Our audited financial statements indicate that there is a substantial doubt about our ability to continue as a going concern.

Our audited financial statements as of and for the period ended April 30, 2022 were prepared on the assumption that we would continue as a going concern. Those financial statements and the accompanying opinion of our auditor expressed a substantial doubt about our ability to continue as a going concern. Those audited financial statements did not include any adjustments that might result from the outcome of this uncertainty. We will need additional capital for full commencement of our planned operations and we are subject to significant risks and uncertainties, including failing to secure funding to commence our planned operations or failing to profitably operate the business. We intend to raise funds through various potential sources, such as equity or debt financings; however, we can provide no assurance that such financing will be available on acceptable terms, or at all. If adequate financing is not available, we may be required to significantly curtail or cease our operations, and our business would be jeopardized.

We have minimal operating capital and for the foreseeable future will be dependent upon our ability to finance our operations from the sale of equity or other financing alternatives. There can be no assurance that we will be able to successfully raise operating capital. The failure to successfully raise operating capital, and the failure to attract qualified real estate companies and sufficient investor purchase commitments, could result in our bankruptcy or other event which would have a material adverse effect on us and our stockholders.

We are employing a business model with a limited track record, which makes our business difficult to evaluate.

Until recently, the short-term rental business consisted primarily of private and individual investors in local markets and was managed individually or by small, non-institutional owners and property managers. Our business strategy involves purchasing, renovating, maintaining and managing a large number of residential properties and renting them short-term to guests. Entry into this market by large, well-capitalized investors is a relatively recent trend, so few peer companies exist and none have yet established long-term track records that might assist us in predicting whether our business model and investment strategy can be implemented and sustained over an extended period of time. It may be difficult for you to evaluate our potential future performance without the benefit of established long-term track records from companies implementing a similar business model. We may encounter unanticipated problems as we continue to refine our business model, which may adversely affect our results of operations and ability to make distributions to our stockholders and cause our share price to decline significantly.

We may not be able to attract investors to invest in our portfolio properties.

The success of our business model is dependent upon our ability to attract investors to co-invest in the portfolio properties we have acquired and those we intend to acquire in the future. There is no assurance that we will be able to obtain investors to invest in our portfolio properties upon terms acceptable to us, if at all.

We may not be able to effectively manage our growth, and any failure to do so may have an adverse effect on our business and operating results.

Our future operating results may depend on our ability to effectively manage our potential growth, which is dependent, in part, upon our ability to:

We can provide no assurance that we will be able to manage our properties or grow our business efficiently or effectively, or without incurring significant additional expenses. Any failure to do so may have an adverse effect on our business and operating results.

The acquisition of homes may be costly and unsuccessful, and, when acquiring portfolios of homes we may acquire some assets that we would not otherwise purchase.

Our business model involves acquiring homes through a variety of channels, renovating these homes to the extent necessary and leasing them to guests. When acquiring homes on an individual basis through foreclosure sales or other transactions, these acquisitions of homes may be costly and may be less efficient than acquisitions of portfolios of homes. Alternatively, portfolio acquisitions are more complex than single-home acquisitions, and we may not be able to implement this strategy successfully. The costs involved in locating and performing due diligence (when feasible) on portfolios of homes as well as negotiating and entering into transactions with potential portfolio sellers could be significant, and there is a risk that either the seller may withdraw from the entire transaction for failure to come to an agreement or the seller may not be willing to sell us the portfolio on terms that we view as favorable. In addition, a seller may require that a group of homes be purchased as a package even though we may not want to purchase certain individual assets in the portfolio.

If we acquire a portfolio of leased homes, to the extent the management and leasing of such homes has not been consistent with our property management and leasing standards, we may be subject to a variety of risks, including risks relating to the condition of the properties, the credit quality and employment stability of the residents and compliance with applicable laws, among others. In addition, financial and other information provided to us regarding such portfolios during our due diligence may be inaccurate, and we may not discover such inaccuracies until it is too late to seek remedies against such sellers. To the extent we timely pursue such remedies, we may not be able to successfully prevail against the seller in an action seeking damages for such inaccuracies. If we conclude that certain assets purchased in bulk portfolios do not fit our target investment criteria, we may decide to sell these assets, which could take an extended period of time and may not result in a sale at an attractive price.

Properties that are being sold through short sales or foreclosure sales are subject to risks of theft, mold, infestation, vandalism, deterioration or other damage that could require extensive renovation prior to renting and adversely impact operating results.

When a property is put into foreclosure due to a default by the owner on its mortgage obligations or the value of the property is substantially below the outstanding principal balance on the mortgage and the owner decides to seek a short sale, the owner may abandon the home or cease to maintain the home as rigorously as the owner normally would. Neglected and vacant properties are subject to increased risks of theft, mold, infestation, vandalism, general deterioration and other maintenance problems that may persist without appropriate attention and remediation. If we begin to purchase a large volume of properties in bulk sales and are not able to inspect them immediately before closing on the purchase, we may purchase properties that may be subject to these problems, which may result in maintenance and renovation costs and time frames that far exceed our estimates. These circumstances could substantially impair our ability to quickly renovate and lease such homes in a cost efficient manner or at all, which would adversely impact our operating results.

We are subject to certain risks associated with bulk portfolio acquisitions and dispositions.

We may acquire and dispose of properties we acquire or sell in bulk from or to other owners of single-family homes, banks and loan servicers. When we acquire a portfolio of properties we may not be permitted, or it may not be feasible for us, to perform on-site inspections of all or any of the properties in the portfolio (or, if applicable, underlying the loans in the portfolio) prior to our acquisition of the portfolio. Such inspection processes may fail to reveal major defects associated with such properties, which may cause the amount of time and cost required to renovate and/or maintain such properties to substantially exceed our estimates. Moreover, to the extent the management and short-term renting of such properties has not been consistent with our property management and leasing standards, we may be subject to a variety of risks, including risks relating to the condition of the properties, the credit quality and employment stability of the residents and compliance with applicable laws, among others. In addition, financial and other information provided to us regarding such portfolios during our due diligence may be inaccurate and we may not discover such inaccuracies until it is too late to seek remedies against such sellers. To the extent we pursue such remedies, we may not be able to successfully prevail against the seller in an action seeking damages for such inaccuracies. As a result, the value of any such properties could be lower than we anticipated at the time of acquisition, and/or such properties could require substantial and unanticipated renovations prior to their conversion into rental homes.

Our evaluation of homes involves a number of assumptions that may prove inaccurate, which could result in us paying too much for any such assets we acquire or overvaluing such assets or such assets failing to perform as we expect.

In determining whether particular homes meet our Investment Criteria, we make a number of assumptions, including, in the case of homes, assumptions related to estimated time of possession and estimated renovation costs and time frames, annual operating costs, market rental rates and potential rent amounts, time from purchase to leasing and resident default rates. These assumptions may prove inaccurate. As a result, we may pay too much for homes we acquire or overvalue such assets, or our homes may fail to perform as we expect. Adjustments to the assumptions we make in evaluating potential purchases may result in fewer homes qualifying under our Investment Criteria, including assumptions related to our ability to lease homes we have purchased. Reductions in the supply of homes that meet our investment criteria may adversely affect our ability to implement our investment strategy and operating results.

Furthermore, the homes that we will acquire may vary materially in terms of time to possession, renovation, quality and type of construction, location and hazards. Our success will depend on our ability to acquire homes that can be quickly possessed, renovated, repaired, upgraded and rented with minimal expense and maintained in rentable condition. Our ability to identify and acquire such homes is fundamental to our success. In addition, the recent market and regulatory environments relating to homes and residential mortgage loans have been changing rapidly, making future trends difficult to forecast. For example, an increasing number of homeowners now wait for an eviction notice or eviction proceedings to commence before vacating foreclosed premises, which significantly increases the time period between the acquisition of, and the leasing of, a home. Such changes affect the accuracy of our assumptions and, in turn, may adversely affect us.

A significant portion of our portfolio properties’ costs and expenses are fixed and we may not be able to adapt our cost structure to offset declines in our revenue.

Many of the expenses associated with our portfolio properties, such as real estate taxes, HOA fees, personal and property taxes, insurance, utilities, acquisition, renovation and maintenance costs, and other general corporate expenses are relatively inflexible and will not necessarily decrease with a reduction in revenues. Some components of our fixed assets will depreciate more rapidly and require ongoing capital expenditures. Our expenses and ongoing capital expenditures will also be affected by inflationary increases and certain of our cost increases may exceed the rate of inflation in any given period or market. By contrast, short-term rental income will be affected by many factors beyond our control, such as the availability of alternative short-term rental housing and economic conditions in our markets. In addition, state and local regulations may require the properties that we own, even if the cost of maintenance is greater than the value of the property or any potential benefit from renting the property, or pass regulations that limit our ability to increase short-term rental rates. As a result, we may not be able to fully offset rising costs and capital spending by increasing short-term rental rates, which could have a material adverse effect on our results of operations and cash available for distribution.

If we overestimate the value or income-producing ability or incorrectly price the risks of our investments, we may experience losses.

Analysis of the value or income-producing ability of a property is highly subjective and may be subject to error. We value potential investments based on yields and risks, taking into account estimated future losses on the commercial real estate loans and the mortgaged property included in the securitization’s pools or select commercial real estate equity investments, and the estimated impact of these losses on expected future cash flows and returns. In the event that we underestimate the risks relative to the price we pay for a particular investment, we may experience losses with respect to such investment.

Increasing property taxes, HOA fees and insurance costs may negatively affect our financial results.

The cost of property taxes and insuring our properties is a significant component of our expenses. Our properties are subject to real and personal property taxes that may increase as tax rates change and as the real properties are assessed or reassessed by taxing authorities. As the owner of our properties, we are ultimately responsible for payment of the taxes to the applicable government authorities. If real property taxes increase, our expenses will increase. If we fail to pay any such taxes, the applicable taxing authority may place a lien on the real property and the real property may be subject to a tax sale.

In addition, a significant portion of our properties may be located within HOAs and we are subject to HOA rules and regulations. HOAs have the power to increase monthly charges and make assessments for capital improvements and common area repairs and maintenance. Property taxes, HOA fees, and insurance premiums are subject to significant increases, which can be outside of our control. If the costs associated with property taxes, HOA fees and assessments or insurance rise significantly and we are unable to increase rental rates due to rent control laws or other regulations to offset such increases, our results of operations would be negatively affected.

We intend to utilize a significant amount of indebtedness in the operation of our business.

We intend to employ prudent leverage, to the extent available, to fund the acquisition of residential assets, refinancing existing debt and for other corporate and business purposes deemed advisable by us. In determining to use leverage, we assess a variety of factors, including without limitation the anticipated liquidity and price volatility of the assets in our investment portfolio, the cash flow generation capability of our assets, the availability of credit on favorable terms, any prepayment penalties and restrictions on refinancing, the credit quality of our assets and our outlook for borrowing costs relative to the unlevered yields on our assets. We may continue to employ portfolio financing and expect to utilize credit facilities or other bank or capital markets debt financing, if available. We may consider seller or in-place financing, if available, from sellers of portfolios of residential assets and potentially financing from government sponsored enterprises if attractive programs are available. We may also utilize other financing alternatives such as securitizations, depending upon market conditions, and other capital raising alternatives such as follow-on offerings of our common shares, preferred shares and hybrid equity, among others. We have no limitation under our organizational documents or any contract on the amount of funds that we may borrow for any single investment or that may be outstanding at any one time in the aggregate. We may significantly increase the amount of leverage we utilize at any time without approval of our board of trustees.

Incurring substantial debt could subject us to many risks that, if realized, would adversely affect us, including the risk that: (i) our cash flow from operations may be insufficient to make required payments of principal and interest on the debt, which is likely to result in acceleration of such debt; (ii) our debt may increase our vulnerability to adverse economic and industry conditions with no assurance that investment yields will increase with higher financing cost; (iii) we may be required to dedicate a portion of our cash flow from operations to payments on our debt, thereby reducing funds available for distributions to our stockholders, operations and capital expenditures, future acquisition opportunities, or other purposes; and, (iv) the terms of any refinancing may not be as favorable as the terms of the debt being refinanced.

If we do not have sufficient funds to repay our debt at maturity, it may be necessary to refinance the debt through additional debt financings or additional capital raising. If, at the time of any refinancing, prevailing interest rates or other factors result in higher interest rates on refinancing, increases in interest expense could adversely affect our cash flows, and, consequently, cash available for distribution to our stockholders. If we are unable to refinance our debt on acceptable terms, we may be forced to dispose of substantial numbers of homes on disadvantageous terms, potentially resulting in losses. To the extent we cannot meet any future debt service obligations, we will risk losing some or all of our homes that may be pledged to secure our obligations to foreclosure. Any unsecured debt agreements we enter into may contain specific cross-default provisions with respect to specified other indebtedness, giving the unsecured lenders the right to declare a default if we are in default under other loans in some circumstances. Defaults under our debt agreements could materially and adversely affect us and cause the value of our common shares to decline.

Our cash flows and operating results could be adversely affected by required payments of debt or related interest and other risks of our debt financing.

We are generally subject to risks associated with debt financing. These risks include: (1) our cash flow may not be sufficient to satisfy required payments of principal and interest; (2) we may not be able to refinance existing indebtedness or the terms of the refinancing may be less favorable to us than the terms of existing debt; (3) required debt payments are not reduced if the economic performance of any property declines; (4) debt service obligations could reduce funds available for distribution to our stockholders and funds available for capital investment; (5) any default on our indebtedness could result in acceleration of those obligations and possible loss of property to foreclosure; and (6) the risk that necessary capital expenditures cannot be financed on favorable terms. If a property is pledged to secure payment of indebtedness and we cannot make the applicable debt payments, we may have to surrender the property to the lender with a consequent loss of any prospective income and equity value from such property. Any of these risks could place strains on our cash flows, reduce our ability to grow and adversely affect our results of operations.

We may be unable to obtain financing through the debt and equity markets, which would have a material adverse effect on our growth strategy and our financial condition and results of operations.

We cannot assure you that we will be able to access the capital and credit markets to obtain additional debt or equity financing or that we will be able to obtain financing on terms favorable to us. Our inability to obtain financing could have negative effects on our business. Among other things, we could have great difficulty acquiring, re-developing or maintaining our properties, which would materially and adversely affect our business strategy and portfolio, and may result in our: (1) liquidity being adversely affected; (2) inability to repay or refinance our indebtedness on or before its maturity; (3) making higher interest and principal payments or selling some of our assets on terms unfavorable to us to service our indebtedness; or (4) issuing additional capital stock, which could further dilute the ownership of our existing stockholders.

Secured indebtedness exposes us to the possibility of foreclosure on our ownership interests in our short-term rental homes.

Incurring mortgage and other secured indebtedness increases our risk of loss of our ownership interests in our rental homes because defaults thereunder, and the inability to refinance such indebtedness, may result in foreclosure action initiated by lenders. For tax purposes, a foreclosure of any of our short-term rental homes would be treated as a sale of the home for a purchase price equal to the outstanding balance of the indebtedness secured by such rental home. If the outstanding balance of the indebtedness secured by such short-term rental home exceeds our tax basis in the short-term rental home, we would recognize taxable income on foreclosure without receiving any cash proceeds.

Covenants in our debt agreements may restrict our operating activities and adversely affect our financial condition.

The financing arrangements that we have entered into contain (and those we may enter into in the future likely will contain) covenants affecting our ability to incur additional debt, make certain investments, reduce liquidity below certain levels, make distributions to our stockholders and otherwise affect our distribution and operating policies.

If we fail to meet or satisfy any of these covenants in our debt agreements, we will be in default under these agreements, which could result in a cross-default under other debt agreements, and our lenders could elect to declare outstanding amounts due and payable, terminate their commitments, require the posting of additional collateral and enforce their respective interests against existing collateral. Additionally, borrowing base requirements associated with our financing arrangements may prevent us from drawing upon our total maximum capacity under these financing arrangements if sufficient collateral, in accordance with our facility agreements, is not available. Further, debt agreements entered into in the future may contain specific cross-default provisions with respect to other specified indebtedness, giving the lenders the right to declare a default if we are in default under other loans in some circumstances. A default also could limit significantly our financing alternatives, which could cause us to curtail our investment activities and/or dispose of assets when we otherwise would not choose to do so. If we default on several of our debt agreements or any single significant debt agreement, we could be materially and adversely affected.

Aspects of our business are subject to privacy, data use and data security regulations, which may impact the way we use data to target customers.

Privacy and security laws and regulations may limit the use and disclosure of certain information and require us to adopt certain cybersecurity and data handling practices that may affect our ability to effectively market our manufacturing capabilities to current, past or prospective customers. In many jurisdictions consumers must be notified in the event of a data security breach, and such notification requirements continue to increase in scope and cost. The changing privacy laws in the U.S., Europe and elsewhere, including the General Data Protection Regulation (“GDPR”) in the European Union, which became effective May 25, 2018, and the California Consumer Privacy Act of 2018, which was enacted on June 28, 2018 and became effective on January 1, 2020, create new individual privacy rights and impose increased obligations, including disclosure obligations, on companies handling personal data. . In addition, the California Consumer Privacy Act of 2018 (“CCPA”) took effect on January 1, 2020, which broadly defines personal information, gives California residents expanded privacy rights and protections, and provides for civil penalties for certain violations. Furthermore, in November 2020, California voters passed the California Privacy Rights and Enforcement Act of 2020 (“CPRA”), which amends and expands CCPA with additional data privacy compliance requirements and establishes a regulatory agency dedicated to enforcing those requirements. Additional countries and states, including Nevada, Virginia, Colorado, Utah, and Connecticut, have also passed comprehensive privacy laws with additional obligations and requirements on businesses. These laws and regulations are increasing in severity, complexity and number, change frequently, and increasingly conflict among the various jurisdictions in which we operate, which has resulted in greater compliance risk and cost for us. In addition, we are also subject to the possibility of security breaches and other incidents, which themselves may result in a violation of these laws. The impact of these continuously evolving laws and regulations could have a material adverse effect on the way we use data to digitally market and pursue our customers.

The current worldwide volatility of financial markets, domestic inflationary pressures, various social and political tensions in the United States and around the world, and public health crises, such as the one caused by COVID-19, may continue to contribute to increased market volatility, may have long-term effects on the United States and worldwide financial markets, and may cause further economic uncertainties or deterioration in the United States and worldwide. Economic uncertainty can have a negative impact on our business through changing spreads, structures and purchase multiples, as well as the overall supply of investment capital. Since 2010, several European Union, or EU, countries, including Greece, Ireland, Italy, Spain, and Portugal, have faced budget issues, some of which may have negative long-term effects for the economies of those countries and other EU countries. Further, there is continued concern about national-level support for the Euro and the accompanying coordination of fiscal and wage policy among European Economic and Monetary Union member countries. In addition, the fiscal policy of foreign nations, such as China, may have a severe impact on the worldwide and United States financial markets. Finally, public health crises, pandemics and epidemics, such as those caused by new strains of viruses such as H5N1 (avian flu), severe acute respiratory syndrome (SARS) and, most recently, COVID-19, are expected to increase as international travel continues to rise and could adversely impact our business by interrupting business, supply chains and transactional activities, disrupting travel, and negatively impacting local, national or global economies. We do not know how long the financial markets will continue to be affected by these events and cannot predict the effects of these or similar events in the future on the United States economy and securities markets or on our investments. As a result of these factors, there can be no assurance that we will be able to successfully monitor developments and manage our investments in a manner consistent with achieving our investment objectives.

The ongoing COVID-19 pandemic and measures intended to prevent its spread could have a material adverse effect on our business, results of operations, cash flows and financial condition.

The COVID-19 pandemic has caused, and is likely to continue to cause, severe economic, market and other disruptions worldwide. We cannot assure you that conditions in the bank lending, capital and other financial markets will not continue to deteriorate as a result of the pandemic, or that our access to capital and other sources of funding will not become constrained, which could adversely affect the availability and terms of future borrowings, renewals or refinancings. In addition, the deterioration of global economic conditions as a result of the pandemic may ultimately decrease occupancy levels and pricing across our portfolio and may cause one or more of our tenants to be unable to meet their rent obligations to us in full, or at all, or to otherwise seek modifications of such obligations. In addition, governmental authorities may enact laws that will prevent us from taking action against tenants who do not pay rent.

The extent of the COVID-19 pandemic’s effect on our operational and financial performance will depend on future developments, including the duration, spread and intensity of the outbreak, all of which are uncertain and difficult to predict. Due to the speed with which the situation is developing, we are not able at this time to estimate the effect of these factors on our business, but the adverse impact on our business, results of operations, financial condition and cash flows could be material.

Maintenance of our Investment Company Act exemption imposes limits on our operations, which may adversely affect our operations.

We intend to conduct our operations so that neither we nor any of our subsidiaries is required to register as an investment company under the Investment Company Act. We anticipate that we will hold real estate and real estate-related assets described below (i) directly, (ii) through wholly-owned subsidiaries, (iii) through majority-owned joint venture subsidiaries, and, (iv) to a lesser extent, through minority-owned joint venture subsidiaries.

In connection with the Section 3(a)(1)(C) analysis, the determination of whether an entity is a majority-owned subsidiary of our Company is made by us. The Investment Company Act defines a majority-owned subsidiary of a person as a company 50% or more of the outstanding voting securities of which are owned by such person, or by another company that is a majority-owned subsidiary of such person. The Investment Company Act further defines voting security as any security presently entitling the owner or holder thereof to vote for the election of directors of a company. We treat companies in which we own at least a majority of the outstanding voting securities as majority-owned subsidiaries. We also treat subsidiaries of which we or our wholly-owned or majority-owned subsidiary is the manager (in a manager-managed entity) or managing member (in a member-managed entity) or in which our agreement or the agreement of our wholly-owned or majority-owned subsidiary is required for all major decisions affecting the subsidiaries (referred to herein as “Controlled Subsidiaries”), as majority-owned subsidiaries even though none of the interests issued by such Controlled Subsidiaries meets the definition of voting securities under the Investment Company Act. We reached our conclusion on the basis that the interests issued by the Controlled Subsidiaries are the functional equivalent of voting securities. We have not asked the SEC staff for concurrence of our analysis, our treatment of such interests as voting securities, or whether the Controlled Subsidiaries, or any other of our subsidiaries, may be treated in the manner in which we intend, and it is possible that the SEC staff could disagree with any of our determinations. If the SEC staff were to disagree with our treatment of one or more companies as majority-owned subsidiaries, we would need to adjust our strategy and our assets. Any such adjustment in our strategy could have a material adverse effect on us.

Certain of our subsidiaries may rely on the exclusion provided by Section 3(c)(5)(C) under the Investment Company Act. Section 3(c)(5)(C) of the Investment Company Act is designed for entities “primarily engaged in the business of purchasing or otherwise acquiring mortgages and other liens on and interests in real estate”. This exclusion generally requires that at least 55% of the entity’s assets on an unconsolidated basis consist of qualifying real estate interests and at least 80% of the entity’s assets consist of qualifying real estate interests or real estate-related assets. These requirements limit the assets those subsidiaries can own and the timing of sales and purchases of those assets.

To classify the assets held by our subsidiaries as qualifying real estate interests or real estate-related assets, we rely on no-action letters and other guidance published by the SEC staff regarding those kinds of assets, as well as upon our analyses (in consultation with counsel) of guidance published with respect to other types of assets. There can be no assurance that the laws and regulations governing the Investment Company Act status of companies similar to ours, or the guidance from the SEC or its staff regarding the treatment of assets as qualifying real estate interests or real estate-related assets, will not change in a manner that adversely affects our operations. In fact, in August 2011, the SEC published a concept release in which it asked for comments on this exclusion from regulation. To the extent that the SEC staff provides more specific guidance regarding any of the matters bearing upon our exemption from the need to register or exclusion under the Investment Company Act, we may be required to adjust our strategy accordingly. Any additional guidance from the SEC staff could further inhibit our ability to pursue the strategies that we have chosen.

Furthermore, although we intend to monitor the assets of our subsidiaries regularly, there can be no assurance that our subsidiaries will be able to maintain their exclusion from registration. Any of the foregoing could require us to adjust our strategy, which could limit our ability to make certain investments or require us to sell assets in a manner, at a price or at a time that we otherwise would not have chosen. This could negatively affect the value of our common shares, the sustainability of our business model and our ability to make distributions.

Registration under the Investment Company Act would require us to comply with a variety of substantive requirements that impose, among other things:

If we were required to register as an investment company but failed to do so, we could be prohibited from engaging in our business, and criminal and civil actions could be brought against us.

Registration with the SEC as an investment company would be costly, would subject us to a host of complex regulations and would divert attention from the conduct of our business, which could materially and adversely affect us.

Our board of directors may change significant corporate policies without stockholder approval.

Our investment, financing, borrowing and dividend policies and our policies with respect to all other activities, including growth, debt, capitalization and operations, will be determined by our board of directors. These policies may be amended or revised at any time and from time to time at the discretion of our board of directors without a vote of our stockholders. In addition, our board of directors may change our policies with respect to conflicts of interest provided that such changes are consistent with applicable legal requirements.

The rights of our stockholders to take action against our directors and officers are limited.

Our Second Amended and Restated Certificate of Incorporation (the “Certificate of Incorporation”) provides for indemnification of our directors and officers to the fullest extent authorized or permitted under Delaware law, except to the extent such exemption from liability or limitation thereof is not permitted under the DGCL as the same exists or hereafter may be amended.

Our Second Amended and Restated Bylaws (the “Bylaws”) will obligate us to indemnify each of our directors or officers who is or is threatened to be made a party to or witness in a proceeding by reason of his or her service in those or certain other capacities, to the maximum extent permitted by Delaware law, from and against any claim or liability to which such person may become subject or which such person may incur by reason of his or her status as a present or former director or officer of us or serving in such other capacities. In addition, we may be obligated to reimburse the expenses reasonably incurred by our present and former directors and officers in connection with such proceedings. As a result, we and our stockholders may have more limited rights to recover money damages from our directors and officers than might otherwise exist absent these provisions in our Bylaws or that might exist with other companies, which could limit your recourse in the event of actions that are not in our best interests.

Our technology that is currently being developed may not yield expected results or be delivered on time.

We could face delays, bugs, or crashes during and after the development process of any of our technologies that could cause adverse results on our timelines and ability to perform. We rely on our technology for our business model and scalability. Should the technology not yield the expected results, we may not be able to achieve scalability on the time-line or at all that we have forecasted. We rely on the ability of our employees to develop our technologies to achieve desired results.

We may incur significant transaction and acquisition-related costs in connection with company acquisitions and such expenditures may create significant liquidity and cash flow risks for us.

We could incur significant, nonrecurring, and recurring costs associated with potential related company acquisition(s), including costs associated with the continued integration of the businesses. In addition, we may continue to incur additional significant, nonrecurring costs in connection with completing a Private Placement. While we have assumed that this level of expense will be incurred, there are factors beyond our control that could affect the total amount, including other integration expenses. Moreover, many of the expenses that will be incurred are, by their nature, difficult to estimate accurately. To the extent any acquisition and integration expenses are higher than anticipated and we do not have sufficient cash, including the additional capital raised in any exempt or private placement offering, then we may experience liquidity or cash flow issues.

Failing to successfully execute and integrate acquisitions could materially adversely affect our business, results of operations, and financial condition.

We have acquired Roost Enterprises, Inc. (d/b/a Rhove) recently, and may acquire more business, as we continue to evaluate potential acquisitions. We may expend significant cash or incur substantial debt to finance such acquisitions, which indebtedness could result in restrictions on our business and significant use of available cash to make payments of interest and principal. In addition, we may finance acquisitions by issuing equity or convertible debt securities, which could result in further dilution to our existing stockholders. We may enter into negotiations for acquisitions that are not ultimately consummated. Those negotiations could result in diversion of management time and significant out-of-pocket costs. If we fail to evaluate and execute acquisitions successfully, our business, results of operations, and financial condition could be materially adversely affected.

In addition, we may not be successful in integrating acquisitions or the businesses we acquire may not perform as well as we expect. Any future failure to manage and successfully integrate acquired businesses could materially adversely affect our business, results of operations, and financial condition. Acquisitions involve numerous risks, including the following:

We depend on our executive officers and dedicated personnel and the departure of any of our key personnel could materially and adversely affect us. We face intense competition for the employment of highly skilled managerial, investment, financial and operational personnel.

Our success is largely dependent on the efforts and abilities of our senior executive group and other key personnel. The loss of the services of one or more of our executive officers or personnel could adversely impact our financial and operational performance and our ability to execute our strategies.

In addition, our future success depends on our ability to attract, train, manage and retain qualified personnel. Competition for highly skilled managerial, investment, financial and operational personnel is intense. As additional large real estate investors enter into and expand their scale within the short-term rental business, we will faced increased challenges in hiring and retaining personnel, and we cannot assure our stockholders that we will be successful in attracting and retaining such skilled personnel. If we are unable to hire and retain qualified personnel as required, our growth and operating results could be adversely affected.

Our ability to meet our labor needs while controlling our labor costs is subject to numerous external factors, including unemployment levels, prevailing wage rates, changing demographics and changes in employment legislation. If we are unable to retain qualified personnel or our labor costs increase significantly, our business operations and our financial performance could be adversely impacted.

Our dependence upon our business partners and their key personnel whose continued service is not guaranteed.

Our business operations are dependent upon our relationships with key business partners, including vendors, suppliers, service providers, and other strategic partners. The loss of one or more of these key business partners, or a significant change in the terms of our relationship with them, could disrupt our business operations and negatively impact our financial performance. Furthermore, the success of our partnerships depends on the continued service and expertise of key personnel at these companies, and we cannot guarantee that these individuals will remain with their respective companies or continue to provide the same level of service or expertise to us. If these individuals leave or are unable to continue providing their services, our ability to maintain and grow our business relationships could be negatively impacted, which could harm our financial results.

Our dependence upon third parties for key services may have an adverse effect on our operating results or reputation if the third parties fail to perform.

Though we are internally managed, we use third-party vendors and service providers to provide certain services for our properties or subcontract for such services. For example, we typically engage third-party home improvement professionals with respect to certain maintenance and specialty services, such as HVAC, roofing, painting and floor installations.

Selecting, managing and supervising these third-party service providers requires significant resources and expertise, and because our portfolio consists of geographically dispersed properties, our ability to adequately select, manage and supervise such third parties may be more limited or subject to greater inefficiencies than if our properties were more geographically concentrated. We generally do not have exclusive, direct or long-term contractual relationships with the third-party providers performing the ultimate services, and we can provide no assurance that we will have uninterrupted or unlimited access to their services. If we do not select, manage and supervise appropriate third parties to provide these services, our reputation and financial results may suffer. Notwithstanding our efforts to implement and enforce strong policies and practices regarding service providers, we may not successfully detect and prevent fraud, misconduct, incompetence or theft by our third-party service providers, including our general contractors. In addition, any removal or termination of third-party service providers would require us to seek new vendors or providers, which would create delays and adversely affect our operations. Poor performance by such third-party service providers will reflect poorly on us and could significantly damage our reputation among desirable residents. In the event of fraud or misconduct by a third party, we could also be exposed to material liability and be held responsible for damages, fines or penalties and our reputation may suffer. In the event of failure by our general contractors to pay their subcontractors, our properties may be subject to filings of mechanics or materialmen liens, which we may need to resolve to remain in compliance with certain debt covenants, and for which indemnification from the general contractors may not be available.

The implementation of artificial intelligence (“AI”) into our technologies may prove to be more difficult than anticipated.

Our business relies on the use of AI to improve our product development and business operations, including through the usage of our reAlpha Score. However, the implementation of AI poses certain risks that need to be carefully considered. The use of AI can potentially lead to unintended consequences, ethical concerns, and data privacy issues. Additionally, reliance on AI can lead to a lack of human oversight and control, which can have negative implications for our organization.

The inability to protect our intellectual property rights could harm our reputation, damage our business or interfere with our competitive position.

Our intellectual property is valuable and provides us with certain competitive advantages. Copyrights, patents, trademarks, service marks, trade secrets, technology licensing agreements, nondisclosure agreements and contracts are used to protect these proprietary rights. Despite these precautions, it may be possible for third parties to copy aspects of our products or, without authorization, to obtain and use information that we regard as trade secrets. Our pending patents may be denied, and our patents may be circumvented by our competitors. In addition, the laws of some foreign countries do not protect our proprietary rights as fully as do the laws of the United States. There can be no assurance that our means of protecting our proprietary rights in the United States or abroad will be adequate or that competing companies will not independently develop similar technologies. Our failure to adequately protect our proprietary rights could have a material adverse effect on our competitive position and our business.

Our operating results are subject to general economic conditions and risks associated with the subsidiary’s real estate assets.

Our operating results are subject to risks generally incident to the ownership and rental of residential real estate, many of which are beyond our control, including, without limitation:

Any one or more of these factors could adversely affect our business, financial condition and results of operations.

Inflation may adversely affect us by increasing costs beyond what we can recover through price increases.

Inflation can adversely affect us by increasing costs of property, materials and labor. In addition, significant inflation is often accompanied by higher interest rates, which have a negative impact on demand for our homes. In an inflationary environment, depending on homebuilding industry and other economic conditions, we may be precluded from raising home prices enough to keep up with the rate of inflation, which would reduce our profit margins. Although the rate of inflation has been low for the last several years, there has recently been increases in the prices of labor and materials above the general inflation rate.

Our investments in real estate assets are and will continue to be concentrated in certain markets and in the single-family properties sector of the real estate industry. This makes our investments exposed to concentrations of risk as a result. For example, a downturn or slowdown in the short-term rental demand for single-family housing caused by adverse economic, regulatory or environmental conditions, or other events, in our markets may have a greater impact on the value of our properties or our operating results than if we had more fully diversified our investments. Likewise, there are seasonal fluctuations in short-term rental demand. The aforementioned risk concentrations expose us to greater fluctuation risk in our operating results, which, in turn can affect our actual results and ability to achieve our business plan.

In addition to general, regional, national and international economic conditions, our operating performance will be impacted by the economic conditions in our markets. We base a substantial part of our business plan on our belief that property values and operating fundamentals for single-family properties in our markets will continue to increase. However, these markets have experienced substantial economic downturns in the past and could experience similar or worse economic downturns in the future. We can provide no assurance as to the extent property values and operating fundamentals in these markets will increase if at all. If economic downturn in these markets return or if we fail to accurately predict the timing of the economic performance of these markets, the value of our properties could decline and our ability to execute our business plan may be adversely affected to a greater extent than if we owned a real estate portfolio that was more geographically diversified, which could adversely affect our financial condition, operating results and our ability to make distributions to our stockholders and cause the value of our common shares to decline.

If our techniques for managing risk are ineffective, we may be exposed to unanticipated losses.

In order to manage the significant risks inherent in our business, we must maintain effective policies, procedures and systems that enable us to identify, monitor and control our exposure to market, operational, legal and reputational risks. Our risk management methods may prove to be ineffective due to their design or implementation or as a result of the lack of adequate, accurate or timely information. If our risk management efforts are ineffective, we could suffer losses or face litigation, particularly from our clients, and sanctions or fines from regulators.

Our techniques for managing risks may not fully mitigate the risk exposure in all economic or market environments, or against all types of risk, including risks that we might fail to identify or anticipate. Any failures in our risk management techniques and strategies to accurately quantify such risk exposure could limit our ability to manage risks or to seek positive, risk-adjusted returns. In addition, any risk management failures could cause fund losses to be significantly greater than historical measures predict. Our more qualitative approach to managing those risks could prove insufficient, exposing us to unanticipated losses in our net asset value and therefore a reduction in our revenues.

Hedging against interest rate exposure may adversely affect our earnings, limit our gains or result in losses, which could adversely affect cash available for distribution to our stockholders.

We may enter into interest rate swap agreements or pursue other interest rate hedging strategies. Our hedging activity, if any, will vary in scope based on the level of interest rates, the type of portfolio investments held, and other changing market conditions. Interest rate hedging may fail to protect or could adversely affect us because, among other things:

Any hedging activity we engage in may adversely affect our earnings, which could adversely affect cash available for distribution to our stockholders. Therefore, while we may enter into such transactions to seek to reduce interest rate risks, unanticipated changes in interest rates may result in poorer overall investment performance than if we had not engaged in any such hedging transactions. In addition, the degree of correlation between price movements of the instruments used in a hedging strategy and price movements in the portfolio positions being hedged or liabilities being hedged may vary materially. Moreover, for a variety of reasons, we may not seek to establish a perfect correlation between such hedging instruments and the portfolio holdings being hedged. Any such imperfect correlation may prevent us from achieving the intended hedge and expose us to risk of loss.

Our investments will be illiquid and we may not be able to vary our portfolio in response to changes in economic and other conditions.

Many factors that are beyond our control affect the real estate market and could affect our ability to sell properties and other investments for the price, on the terms or within the time frame that we desire. These factors include general economic conditions, the availability of financing, interest rates and other factors, including supply and demand. Because real estate investments are relatively illiquid, we have a limited ability to vary our portfolio in response to changes in economic or other conditions. Further, before we can sell a property on the terms we want, it may be necessary to expend funds to correct defects or to make improvements. However, we can give no assurance that we will have the funds available to correct such defects or to make such improvements. Moreover, the senior mortgage loans, subordinated loans, mezzanine loans and other loans and investments we may originate or purchase will be particularly illiquid investments due to their short life and the greater difficulty of recoupment in the event of a borrower’s default. As a result, we expect many of our investments will be illiquid, and if we are required to liquidate all or a portion of our portfolio quickly, we may realize significantly less than the value at which we have previously recorded our investments and our ability to vary our portfolio in response to changes in economic and other conditions may be relatively limited, which could adversely affect our results of operations and financial condition.

We may not be able to effectively control the timing and costs arising from renovation our properties, and the cost of maintaining rental properties is generally higher than the cost of maintaining owner-occupied homes, which may adversely affect our operating results and ability to make distributions to our stockholders.

Our properties often require some level of renovation either immediately upon their acquisition or in the future. While our focus is on rent-ready homes, we may acquire properties that we plan to extensively renovate. We may also acquire properties that we expect to be in good condition only to discover unforeseen defects and problems that require extensive renovation and capital expenditures. In addition, from time to time, we may perform ongoing maintenance or make ongoing capital improvements and replacements and perform significant renovations and repairs that insurance may not cover. Because our portfolio may consist of geographically dispersed properties, our ability to adequately monitor or manage any such renovations or maintenance may be more limited or subject to greater inefficiencies than if our properties were more geographically concentrated.

Our properties may have infrastructure and appliances of varying ages and conditions. Consequently, we will retain independent contractors and trade professionals to perform physical repair work and are exposed to all of the risks inherent in property renovation and maintenance, including potential cost overruns, increases in labor and materials costs, delays by contractors in completing work, delays in the timing of receiving necessary work permits, supply-chain challenges for material required to complete work timely and cost effectively, and poor workmanship. If our assumptions regarding the costs or timing of renovation and maintenance across our properties prove to be materially inaccurate, our operating results and ability to make distributions to our stockholders may be adversely affected.

Further, renters impose additional risks to owning real property. Renters do not have the same interest as an owner in maintaining a property and its contents and generally do not participate in any appreciation of the property. Accordingly, renters may damage a property and its contents, and may not be forthright in reporting damages or amenable to repairing them completely or at all. A rental property may need repairs and/or improvements after each resident vacates the premises, the costs of which may exceed any security deposit provided to us by the resident when the rental property was originally leased. Accordingly, the cost of maintaining rental properties can be higher than the cost of maintaining owner-occupied homes, which will affect our costs of operations and may adversely impact our ability to make distributions to our stockholders.

Our leases are relatively short-term in nature, typically a few days or weeks, which exposes us to the risk that we may have to re-lease our properties frequently and we may be unable to do so on attractive terms, on a timely basis or at all.

Because these leases generally permit the residents to leave at the end of the lease term without penalty, our rental revenues may be impacted by declines in market rental rates more quickly than if our leases were for longer terms. Short-term leases may result in high turnover, which involves costs such as restoring the properties, marketing costs and lower occupancy levels. Our resident turnover rate and related cost estimates may be less accurate than if we had more operating data upon which to base such estimates. In addition, to the extent that a potential resident is represented by a leasing agent, we may need to pay all or a portion of any related agent commissions, which will reduce the revenue from a particular rental home. Alternatively, to the extent that a lease term exceeds one year, we may miss out on the ability to raise rents in an appreciating market and be locked into a lower rent until such lease expires. If the rental rates for our properties decrease or our residents do not renew their leases, our operating results and ability to make distributions to our stockholders could be adversely affected.

We face significant competition in the short-term rental market for guests, which may limit our ability to short-term rent our properties on favorable terms.

We depend on short-term rental income from guests to cover our operating costs. As a result, our success depends in large part upon our ability to attract guests for our properties. We face competition for guests from other lessors of single-family properties, apartment buildings and condominium units. Competing properties may be newer, better located and more attractive to residents. Potential competitors may have lower rates of occupancy than we do or may have superior access to capital and other resources, which may result in competing owners more easily locating residents and leasing available housing at lower rental rates than we might offer at our homes. Many of these competitors may successfully attract residents with better incentives and amenities, which could adversely affect our ability to obtain quality residents and lease our single-family properties on favorable terms. This competition may affect our ability to attract and retain guests and may reduce the short-term rental rates we are able to charge.

In addition, we could also be adversely affected by high vacancy rates of short-term rentals in our markets, which could result in an excess supply of short-term rental homes and reduce occupancy and rental rates. Continuing development of apartment buildings and condominium units in many of our markets will increase the supply of housing and exacerbate competition for residents.

No assurance can be given that we will be able to attract guests. If we are unable to short-term rent our homes to suitable guests, we would be adversely affected and the value of our common stock could decline.

We may acquire alternative property types that may have less appreciation and could be more difficult to dispose.

While our acquisition strategy focuses on rent-ready single-family homes, we may in the future acquire multifamily vacation rentals, experimental homes, experiential homes, or other vacation rental viable properties. These homes may add liquidity risk and could be harder to sell at optimal prices with proper timing.

We intend to continue to acquire properties, from time to time, consistent with our investment strategy even if the short-term rental and housing markets are not as favorable as they have been in the recent past, which could adversely impact anticipated yields.

We intend to continue to acquire properties, from time to time, consistent with our investment strategy, even if the rental and housing markets are not as favorable as they have been in the recent past. Future acquisitions of properties may be more costly than those we have acquired previously. The following factors, among others, may make acquisitions more expensive:

We plan to continue acquiring properties as long as we believe such properties offer an attractive total return opportunity. Accordingly, future acquisitions may have lower yield characteristics than recent past and present opportunities and, if such future acquisitions are funded through equity issuances, the yield and distributable cash per share will be reduced, and the value of our common stock may decline.

Competition in identifying and acquiring our properties could adversely affect our ability to implement our business and growth strategies, which could materially and adversely affect us.

In acquiring our properties, we compete with a variety of institutional investors, including REITs, specialty finance companies, public and private funds, savings and loan associations, banks, mortgage bankers, insurance companies, institutional investors, investment banking firms, financial institutions, governmental bodies and other entities. We also compete with individual private home buyers and small-scale investors. Certain of our competitors may be larger in certain of our markets and may have greater financial or other resources than we do. Some competitors may have a lower cost of funds and access to funding sources that may not be available to us. In addition, any potential competitor may have higher risk tolerances or different risk, which could allow them to consider a wider variety of investments. Competition may result in fewer investments, higher prices, a broadly dispersed portfolio of properties that does not lend itself to efficiencies of concentration, acceptance of greater risk, lower yields and a narrower spread of yields over our financing costs. In addition, competition for desirable investments could delay the investment of our capital, which could adversely affect our results of operations and cash flows. As a result, there can be no assurance that we will be able to identify and finance investments that are consistent with our investment objectives or to achieve positive investment results, and our failure to accomplish any of the foregoing could have a material adverse effect on us and cause the value of our common stock to decline.

Short-term rental homes are subject to various covenants and local laws and regulatory requirements, including permitting, licensing and zoning requirements. Local regulations, including municipal or local ordinances, restrictions and restrictive covenants imposed by community developers may restrict our use of our properties and may require us to obtain approval from local officials or community standards organizations at any time with respect to our properties, including prior to acquiring any of our properties or when undertaking renovations of any of our existing properties. Among other things, these restrictions may relate to fire and safety, seismic, asbestos-cleanup or hazardous material abatement requirements. Additionally, such local regulations may cause us to incur additional costs to renovate or maintain our properties in accordance with the particular rules and regulations. We cannot assure you that existing regulatory policies will not adversely affect our ability to achieve results in terms of adherence to our forecasted plans and achieved in service rental properties on our projected timeline. Likewise, regulatory policies may adversely affect the timing or cost of our future acquisitions or renovations Additional regulations may be adopted that will increase delays or result in additional costs. Our business and growth strategies may be materially and adversely affected by our ability to obtain permits, licenses and approvals. Our failure to obtain such permits, licenses and approvals could have a material adverse effect on us and cause the value of our common stock to decline.

We may become a target of legal demands, litigation (including class actions), and negative publicity by tenant and consumer rights organizations, which could directly limit and constrain our operations and may result in significant litigation expenses and reputational harm.

Numerous tenant rights and consumer rights organizations exist throughout the country and operate in our markets. We may attract attention from some of these organizations and become a target of legal demands, litigation, and negative publicity. Many consumer organizations have become more active and better funded in connection with mortgage foreclosure-related issues and with the increased market for homes arising from displaced homeownership. Some of these organizations may shift their litigation, lobbying, fundraising, and grass roots organizing activities to focus on landlord-resident issues. While we intend to conduct our business lawfully and in compliance with applicable landlord-tenant and consumer laws, such organizations might work in conjunction with trial and pro bono lawyers in one or multiple states to attempt to bring claims against us on a class action basis for damages or injunctive relief and to seek to publicize our activities in a negative light. We cannot anticipate what form such legal actions might take or what remedies they may seek.

Additionally, such organizations may lobby local county and municipal attorneys or state attorneys general to pursue enforcement or litigation against us, may lobby state and local legislatures to pass new laws and regulations to constrain or limit our business operations, adversely impact our business, or may generate negative publicity for our business and harm our reputation. If they are successful in any such endeavors, they could directly limit and constrain our operations and may impose on us significant litigation expenses, including settlements to avoid continued litigation or judgments for damages or injunctions.

We are subject to a variety of laws and regulations that involve matters such as: privacy; data protection; personal information; rights of publicity; content; marketing; distribution; data security; data retention and deletion; electronic contracts and other communications; consumer protection; and online payment services. These laws and regulations are constantly evolving and can be subject to significant change. As a result, the application, interpretation, and enforcement of these laws and regulations are often uncertain and may be interpreted and applied inconsistently. Additionally, as we depend on third parties for key services, we rely on such third-party service providers’ compliance with laws and regulations regarding privacy, data protection, consumer protection, and other matters relating to our customers.

There are a number of legislative proposals at both the federal and state level, as well as other jurisdictions that could impose new obligations in areas affecting our business. We are subject to numerous, complex, and frequently changing laws, regulations, and contractual obligations designed to protect personal information. Various federal and state privacy and data security laws and regulatory standards create data privacy rights for users, including more ability to control how their data is shared with third parties. These laws and regulations, as well as any associated inquiries or investigations or any other government actions, may be costly to comply with, result in negative publicity, require significant management time and attention, and subject us to remedies that may harm our business, including fines or demands or orders that we modify or cease existing business practices.

We may not successfully detect and prevent fraud, misconduct, incompetence or theft by our third-party service providers. In addition, any removal or termination of third-party service providers would require us to seek new vendors or providers, which would create delays and adversely affect our operations. Poor performance by such third-party service providers will reflect poorly on us and could significantly damage our reputation among guests. In the event of fraud or misconduct by a third party, we could also be exposed to material liability and be held responsible for damages, fines or penalties and our reputation may suffer.

We may from time to time in the future acquire some of our homes through the auction process, which could subject us to significant risks that could adversely affect us.

We may from time to time in the future acquire some of our homes through the auction process, including auctions of homes that have been foreclosed upon by third party lenders. Such auctions may occur simultaneously in a number of markets, including monthly auctions on the same day of the month in certain markets. As a result, we may only be able to visually inspect properties from the street and will purchase these homes without a contingency period and in “as is” condition with the risk that unknown defects in the property may exist. Upon acquiring a new home, we may have to evict residents who are in unlawful possession before we can secure possession and control of the home. The holdover occupants may be the former owners or residents of a property, or they may be squatters or others who are illegally in possession. Securing control and possession from these occupants can be both costly and time-consuming or generate negative publicity for our business and harm our reputation.

Title defects could lead to material losses on our investments in our properties.

Our title to a property may be challenged for a variety of reasons, and in such instances title insurance may not prove adequate. We may, from time to time, in the future, acquire a number of our properties on an “as is” basis, at auctions or otherwise. When acquiring properties on an “as is” basis, title commitments are often not available prior to purchase and title reports or title information may not reflect all senior liens, which may increase the possibility of acquiring houses outside predetermined acquisition and price parameters, purchasing residences with title defects and deed restrictions, HOA restrictions on short-term renting, or purchasing the wrong residence without the benefit of title insurance prior to closing. This could lead to a material if not complete loss on our investment in such properties.

For properties we acquire at auction, we similarly do not obtain title insurance prior to purchase, and we are not able to perform the type of title review that is customary in acquisitions of real property. As a result, our knowledge of potential title issues will be limited, and no title insurance protection will be in place. This lack of title knowledge and insurance protection may result in third parties having claims against our title to such properties that may materially and adversely affect the values of the properties or call into question the validity of our title to such properties. Without title insurance, we are fully exposed to, and would have to defend ourselves against, such claims. Further, if any such claims are superior to our title to the property we acquired, we risk loss of the property purchased.

Increased scrutiny of title matters could lead to legal challenges with respect to the validity of the sale. In the absence of title insurance, the sale may be rescinded and we may be unable to recover our purchase price, resulting in a complete loss. Title insurance obtained subsequent to purchase offers little protection against discoverable defects because they are typically excluded from such policies. In addition, any title insurance on a property, even if acquired, may not cover all defects or the significant legal costs associated with obtaining clear title.

Any of these risks could adversely affect our operating results, cash flows, and ability to make distributions to our stockholders.

As a start-up business, we do not have a long operating history. Accordingly, recent events, including the securities regulatory matters, could have a greater impact upon us than a company that has a long operating history. For example, it may make it more difficult for us to bind coverage with insurance carriers or to achieve better rates from other service providers or lenders due to these recent events due to a higher risk profile.

Contingent or unknown liabilities could adversely affect our financial condition, cash flows and operating results.

Assets and entities that we have acquired or may acquire in the future may be subject to unknown or contingent liabilities for which we may have limited or no recourse against the sellers. Unknown or contingent liabilities might include liabilities for or with respect to liens attached to properties, unpaid real estate tax, utilities, or HOA charges for which a subsequent owner remains liable, clean-up or remediation of environmental conditions or code violations, claims of customers, vendors, or other persons dealing with the acquired entities, and tax liabilities. Purchases of single-family properties acquired at auction, in short sales, from lenders, or in portfolio purchases typically involve few or no representations or warranties with respect to the properties and may allow us limited or no recourse against the sellers. Such properties also often have unpaid tax, utility, and HOA liabilities for which we may be obligated but fail to anticipate. As a result, the total amount of costs and expenses that we may incur with respect to liabilities associated with acquired properties and entities may exceed our expectations, which may adversely affect our operating results and financial condition. Additionally, such properties may be subject to covenants, conditions, or restrictions that restrict the use or ownership of such properties, including prohibitions on short-term renting. We may not discover such restrictions during the acquisition process and such restrictions may adversely affect our ability to operate such properties as we intend.

Under various federal, state and local environmental laws, a current or previous owner or operator of real property may be liable for the cost of removing or remediating hazardous or toxic substances on such property. Such laws often impose liability whether or not the owner or operator knew of, or was responsible for, the presence of such hazardous or toxic substances. Even if more than one person may have been responsible for the contamination, each person covered by applicable environmental laws may be held responsible for all of the clean-up costs incurred. In addition, third parties may sue the owner or operator of a site for damages based on personal injury, natural resources or property damage or other costs, including investigation and clean-up costs, resulting from the environmental contamination. The presence of hazardous or toxic substances on one of our properties, or the failure to properly remediate a contaminated property, could give rise to a lien in favor of the government for costs it may incur to address the contamination or otherwise adversely affect our ability to sell or short-term rent the property or borrow using the property as collateral. Environmental laws also may impose restrictions on the manner in which property may be used or businesses may be operated. A property owner who violates environmental laws may be subject to sanctions which may be enforced by governmental agencies or, in certain circumstances, private parties. In connection with the acquisition and ownership of our properties, we may be exposed to such costs. The cost of defending against environmental claims, of compliance with environmental regulatory requirements or of remediating any contaminated property could materially and adversely affect us.

Compliance with new or more stringent environmental laws or regulations or stricter interpretation of existing laws may require material expenditures by us. We may be subject to environmental laws or regulations relating to our properties, such as those concerning lead-based paint, mold, asbestos, and proximity to power lines or other issues. We cannot assure you that future laws, ordinances or regulations will not impose any material environmental liability or that the current environmental condition of our properties will not be affected by the activities of residents, existing conditions of the land, operations in the vicinity of the properties or the activities of unrelated third parties. In addition, we may be required to comply with various local, state and federal fire, health, life-safety and similar regulations. Failure to comply with applicable laws and regulations could result in fines and/or damages, suspension of personnel, civil liability or other sanctions.

If we fail to attract guests, or if we fail to provide high-quality stays and experiences, our business, results of operations, and financial condition would be materially adversely affected.

Our business depends on our ability to maintain our properties and engage in practices that encourage guests to book those properties, including increasing the number of nights that are available to book, providing timely responses to inquiries from guests, offering a variety of desirable and differentiated listings at competitive prices that meet the expectations of guests, and offering hospitality, services, and experiences that satisfy guests and which prospective guests view as valuable. If we do not establish or maintain a sufficient number of listings and availability for listings, or if the number of nights booked declines for a particular period, or the prices we are able to charge declines, our revenue would decline and our business, results of operations, and financial condition would be materially adversely affected.

Additional reasons for our financial performance may be affected by economic, social, and political factors; perceptions of trust and safety in our properties; negative experiences with guests, including guests who damage our property, throw unauthorized parties, or engage in violent and unlawful acts; and our decision to remove guests for not adhering to our guest standards or other factors we deem detrimental to our community. Our business, results of operations, and financial condition could be materially adversely affected if our guests are unable to return to normal travel in the near to immediate term.

If we fail to retain guests or add new guests, our business, results of operations, and financial condition would be materially adversely affected.

Our success depends significantly on existing guests continuing to book and attracting new guests to book our properties. Our ability to attract and retain guests could be materially adversely affected by a number of factors discussed elsewhere in these “Risk Factors,” including:

In addition, if our listings and other content provided are not displayed effectively to guests, we are not effective in engaging guests across our various offerings, we fail to provide an experience in a manner that meets rapidly changing demand, or guests have unsatisfactory search, booking, or payment experiences, we could fail to convert first-time guests and fail to engage with existing guests, which would materially adversely affect our business, results of operations, and financial condition.

Properties could be difficult to short-term rent, which could adversely affect our revenues.

The properties we acquire are vacant at the time of closing and we may not be successful in attracting guests to short-term rent the individual properties that we acquire as quickly as we had expected or at all. Rental revenues may be affected by declines in market rental rates more quickly than if our leases were for longer terms. Even if we are able to find guests as quickly as we had expected, we may incur vacancies and may not be able to re-short-term rent those properties without longer-than-assumed delays, which may result in increased renovation and maintenance costs. In addition, the value of a vacant property could be substantially impaired. Vacant homes may also be at risk for fraudulent activity which could impact our ability to lease a home. As a result, if vacancies continue for a longer period of time than we expect or indefinitely, we may suffer reduced revenues, which may have a material adverse effect on us.

Declining real estate valuations and impairment charges could adversely affect our financial condition and operating results.

We periodically review the value of our properties to determine whether their value, based on market factors, projected income and generally accepted accounting principles, has permanently decreased such that it is necessary or appropriate to take an impairment loss in the relevant accounting period. Such a loss would cause an immediate reduction of net income in the applicable accounting period and would be reflected in a decrease in our balance sheet assets. The reduction of net income from impairment losses could lead to a reduction in our dividends, both in the relevant accounting period and in future periods. Even if we do not determine that it is necessary or appropriate to record an impairment loss, a reduction in the intrinsic value of a property would become manifest over time through reduced income from the property and would therefore affect our earnings and financial condition.

We are highly dependent on information systems and systems failures could significantly disrupt our business, which may, in turn, negatively affect us and the value of our common stock.

Our operations are dependent upon our internal operating systems, and property management platforms, as well as external short-term rental platforms, like Airbnb, which include certain automated processes that require access to telecommunications or the internet, each of which is subject to system security risks. Certain critical components are dependent upon third party service providers and a significant portion of our business operations are conducted over the internet. As a result, we could be severely impacted by a catastrophic occurrence, such as a natural disaster or a terrorist attack, or a circumstance that disrupted access to telecommunications, the internet or operations at our third-party service providers, including viruses or experienced computer programmers that could penetrate network security defenses and cause system failures and disruptions of operations. Even though we believe we utilize appropriate duplication and back-up procedures, a significant outage in telecommunications, the internet or at our third-party service providers could negatively impact our operations.

Security breaches and other disruptions could compromise our information systems and expose us to liability, which would cause our business and reputation to suffer.

Information security risks have generally increased in recent years due to the rise in new technologies and the increased sophistication and activities of perpetrators of cyberattacks. In the ordinary course of our business, we acquire and store sensitive data, including intellectual property, our proprietary business information and personally identifiable information of our prospective and current residents, employees and third-party service providers. The secure processing and maintenance of such information is critical to our operations and business strategy. Despite our security measures, our information technology and infrastructure may be vulnerable to attacks by hackers or breached due to employee error, malfeasance or other disruptions. Any such breach could compromise our networks and the information stored therein could be accessed, publicly disclosed, misused, lost or stolen. Any such access, disclosure or other loss of information could result in legal claims or proceedings, liability under laws that protect the privacy of personal information, regulatory penalties, disruption to our operations and the services we provide to customers or damage our reputation, any of which could adversely affect our results of operations, reputation and competitive position.

We rely upon Amazon Web Services to operate certain aspects of our service and any disruption of or interference with our use of the Amazon Web Services operation would impact our operations and our business would be adversely impacted.

Amazon Web Services (“AWS”) provides a distributed computing infrastructure platform for business operations, or what is commonly referred to as a “cloud” computing service. Our software and computer systems have been designed to utilize data processing, storage capabilities and other services provided by AWS. Currently, we run the vast majority of our computing on AWS. Given this, along with the fact that we cannot easily switch our AWS operations to another cloud provider, any disruption of or interference with our use of AWS would impact our operations and our business would be adversely impacted.

We may be involved in a range of legal actions in the ordinary course of business. These actions may include, among others, challenges to title and ownership rights, disputes arising over potential violations of HOA rules and regulations, issues with local housing officials arising from the condition or maintenance of the property, outside vendor disputes and trademark infringement and other intellectual property claims. These actions can be time-consuming and expensive, and may adversely affect our reputation. Although we are not currently involved in any legal or regulatory proceedings that we expect would have a material adverse effect on our business, results of operations or financial condition, and such proceedings may arise in the future.

We attempt to ensure that our properties are adequately insured to cover casualty losses. However, there are certain losses, including losses from floods, fires, earthquakes, wind, pollution, acts of war, acts of terrorism or riots, for which we may self-insure or which may not always or generally be insured against because it may not be deemed economically feasible or prudent to do so. Changes in the cost or availability of insurance could expose us to uninsured casualty losses. In particular, a number of our properties may be located in areas that are known to be subject to increased earthquake activity, fires, or wind and/or flood risk. While we may have policies for earthquakes and hurricane and/or flood risk, our properties may nonetheless incur a casualty loss that is not fully covered by insurance. In such an event, the value of the affected properties would be reduced by the amount of any such uninsured loss, and we could experience a significant loss of capital invested and potential revenues in such properties and could potentially remain obligated under any recourse debt associated with such properties. Inflation, changes in building codes and ordinances, environmental considerations and other factors might also keep us from using insurance proceeds to replace or renovate a particular property after it has been damaged or destroyed. Under those circumstances, the insurance proceeds we receive might be inadequate to restore our economic position on the damaged or destroyed property. Any such losses could adversely affect us and cause the value of our common stock to decline. In addition, we may have no source of funding to repair or reconstruct the damaged home, and we cannot assure that any such sources of funding will be available to us for such purposes in the future.

We face possible risks associated with natural disasters and extreme weather events (the frequency and severity of which may be impacted by climate change), which may include more frequent or severe storms, extreme temperatures and ambient temperature increases, hurricanes, flooding, rising sea levels, shortages of water, droughts, and wildfires, any of which could have a material adverse effect on our business, results of operations, and financial condition.

We are subject to the risks associated with natural disasters and the physical effects of climate change, which may include more frequent or severe storms, extreme temperatures and ambient temperature increases, hurricanes, flooding, rising sea levels, shortages of water, droughts, and wildfires (although it is currently impossible to accurately predict the impact of climate change on the frequency or severity of these events), any of which could have a material adverse effect on our business, results of operations, and financial condition. We will operate in certain areas where the risk of natural or climate-related disaster or other catastrophic losses exists, and the occasional incidence of such an event could cause substantial damage to our properties or the surrounding area. For example, to the extent climate change causes changes in weather patterns or an increase in extreme weather events, our coastal destinations could experience increases in storm intensity and rising sea-levels causing damage to our properties and result in a reduced number of listings in these areas. Other destinations could experience extreme temperatures and ambient temperature increases, shortages of water, droughts, wildfires, and other extreme weather events that make those destinations less desirable. Climate change may also affect our business by increasing the cost of, or making unavailable, property insurance on terms we find acceptable in areas most vulnerable to such events, increasing operating costs, including the availability and cost of water or energy, and requiring us to expend funds as we seek to repair and protect our properties in connection with such events. As a result of the foregoing and other climate-related issues, we may decide to remove such listings from our platform. If we are unable to provide listings in certain areas due to climate change, we may lose guests, which could have a material adverse effect on our business, results of operations, and financial condition.

Eminent domain could lead to material losses on our investments in our properties.

Governmental authorities may exercise eminent domain to acquire the land on which our properties are built in order to build roads and other infrastructure. Any such exercise of eminent domain would allow us to recover only the fair value of the affected properties. In addition, “fair value” could be substantially less than the real market value of the property for a number of years, and we could effectively have no profit potential from properties acquired by the government through eminent domain.

We may have difficulty selling our real estate investments and our ability to distribute all or a portion of the net proceeds from any such sale to our stockholders may be limited.

Real estate investments are relatively illiquid and, as a result, we may have a limited ability to sell our properties. When we sell any of our properties, we may recognize a loss on such sale. We may elect not to distribute any proceeds from the sale of properties to our stockholders. Instead, we may use such proceeds for other purposes, including:

Laws, regulations, and rules that affect the short-term rental may limit our ability to offer short-term rentals and could expose us to significant penalties, which could have a material adverse effect on our business, results of operations, and financial condition.

Hotels and groups affiliated with hotels, neighborhoods, and communities have engaged and will likely continue to engage in various lobbying and political efforts for stricter regulations governing short-term rentals with both local and national jurisdictions. These groups and others cite concerns around affordable housing and over-tourism in major cities, and some state and local governments have implemented or considered implementing rules, ordinances, or regulations governing the short-term rental of properties and/or home sharing. Such regulations include ordinances that restrict or ban short-term rentals, set annual caps on the number of days we can rent our homes for short-term rental, require us to register with the municipality or city, or require us to obtain permission before offering short-term rentals. In addition, some jurisdictions regard short-term rental as “hotel use” and claim that such use constitutes a conversion of a residential property to a commercial property requiring a permitting process. Macroeconomic pressures and public policy concerns could continue to lead to new laws and regulations, or interpretations of existing laws and regulations, which limit the ability of hosts to share their spaces. If laws, regulations, rules, or agreements significantly restrict or discourage short-term rentals in certain jurisdictions, it would have a material adverse effect on our business, results of operations, and financial condition.

Guest, or third-party actions that are criminal, violent, inappropriate, or dangerous, or fraudulent activity, may undermine the safety or the perception of safety of our properties and our ability to attract and retain guests and materially adversely affect our reputation, business, results of operations, and financial condition.

We have no control over or ability to predict the actions of our guests and other third parties, such as neighbors or invitees, either during the guest’s stay, experience, or otherwise, and therefore, we cannot guarantee the safety of our guests, and third parties. The actions of guests and other third parties can result in fatalities, injuries, other bodily harm, fraud, invasion of privacy, property damage, discrimination and brand and reputational damage, which could create potential legal or other substantial liabilities for us. We do not verify the identity of our guests nor do we verify or screen third parties who may be present during a reservation. We rely on the booking sites’ ability to validate the guests’ information. The verification processes used by the booking sites are beneficial but not exhaustive and have limitations due to a variety of factors, including laws and regulations that prohibit or limit their ability to conduct effective background checks in some jurisdictions, the unavailability of information, and the inability of their systems to detect all suspicious activity. There can be no assurances that these measures will significantly reduce criminal or fraudulent activity.

If guests, or third parties engage in criminal activity, misconduct, fraudulent, negligent, or inappropriate conduct or use our properties as a conduit for criminal activity, consumers may not consider our listings safe, and we may receive negative media coverage, or be subject to involvement in a government investigation concerning such activity, which could adversely impact our brand and reputation – thereby impacting our operating results.

The methods used by perpetrators of fraud and other misconduct are complex and constantly evolving, and our trust and security measures may currently or in the future be insufficient to detect and help prevent all fraudulent activity and other misconduct.

In addition, certain regions where we are planning to operate have higher rates of violent crime or more relaxed safety standards, which can lead to more safety and security incidents, and may adversely impact the bookings of our properties in those regions and elsewhere.

If criminal, inappropriate, fraudulent, or other negative incidents occur due to the conduct of guests or third parties, our ability to attract and retain guests would be harmed, and our business, results of operations, and financial condition would be materially adversely affected – thereby impacting other guests. Such incidents may in the future prompt stricter home short-term rental regulations or regulatory inquiries into our policies and business practices.

Measures that we are planning to take to ensure the trust and safety of our properties may cause us to incur significant expenditures and may not be successful.

We are planning to take measures to ensure the trust and safety of our properties, to combat fraudulent activities and other misconduct and improve trust, such as using smart locks, noise monitoring systems, and potentially use identity scanners at each property. These measures are long-term investments in our business to promote the trust and safety of our properties; however, some of these measures increase friction by increasing the number of steps required to be able to rent one of our properties, which could reduce Guest activity, and could materially and adversely affect our business, results of operations, and financial condition. The timing and implementation of these measures will vary across geographies. There can be no assurances that our plans to invest in the trust and safety of our properties will be successful, significantly reduce criminal or fraudulent activity on or off our properties, or be sufficient to protect our reputation in the event of such activity.

In the future, we may have operations in countries known to experience high levels of corruption and any violation of anti-corruption laws could subject us to penalties and other adverse consequences.

We are subject to the U.S. Foreign Corrupt Practices Act (“FCPA”) and other laws in the United States and elsewhere that prohibit improper payments or offers of payments to foreign governments and their officials, political parties, state-owned or controlled enterprises, and/or private entities and individuals for the purpose of obtaining or retaining business. We may have operations in, and that otherwise deal with countries known to experience corruption. Our activities in these countries create the risk of unauthorized payments or offers of payments by one of our employees, contractors, agents, or users that could be in violation of various laws, including the FCPA and anti-bribery laws in these countries. Failure to comply with any of these laws and regulations may result in extensive internal or external investigations as well as significant financial penalties and reputational harm, which could materially adversely affect our business, results of operations, and financial condition.

We will control the direction of our business and its ownership of our common stock will prevent you and other stockholders from influencing significant decisions.

As long as our Company’s major stockholders continue to hold those shares, it will be able to significantly influence or effectively control the composition of our board of directors and the approval of actions requiring stockholder approval through its voting power. Accordingly, for such period of time, Giri Devanur, our Chief Executive Officer, will have significant influence with respect to our management, business plans and policies. In particular, for so long our company continues to hold its shares, it may be able to cause or prevent a change of control of our Company or a change in the composition of our board of directors, and could preclude any unsolicited acquisition of our Company. The concentration of ownership could deprive you of an opportunity to receive a premium for your shares of common stock as part of a sale of our Company and ultimately might affect the value of your common stock.

There can be no assurance that our company will be able to list on Nasdaq, or that such a listing will be maintained even if achieved. Our ability to list on Nasdaq is subject to a number of conditions, including meeting certain financial and corporate governance requirements. While we believe we currently satisfy these requirements, there is no guarantee that we will continue to do so in the future. Additionally, Nasdaq may reject our application for listing or we may encounter delays or other issues that prevent or delay our listing. If we are unable to list on Nasdaq, or if we are delisted after listing, we may be forced to seek alternative listing arrangements or operate on an over-the-counter market, which could negatively impact our ability to raise capital, our liquidity, and the marketability of our securities. Our inability to list on Nasdaq could also have a negative impact on our reputation, business prospects, and financial condition. Therefore, investors should carefully consider the risks and uncertainties related to our ability to list on Nasdaq before making an investment decision.

Because we are a “controlled company” as defined in the Nasdaq Stock Market Rules, you may not have protection of certain corporate governance requirements which otherwise are required by Nasdaq’s rules.

Under Nasdaq’s rules, a controlled company is a company of which more than 50% of the voting power for the election of directors is held by an individual, group or another company. We are a controlled company because Mr. Giri Devanur, our chief executive officer and Chairman, holds more than 50% of our voting power, and we expect we will continue to be a controlled company upon the Direct Listing. For so long as we remain a controlled company, we are not required to comply with the following permitted to elect to rely, and may rely, on certain exemptions from the obligation to comply with certain corporate governance requirements, including:

We have not taken advantage of these exemptions. As a result, to the extent that we take advantage of these exemptions, you will not have the same protections afforded to stockholders of companies that are subject to all of the Nasdaq corporate governance requirements. Although we do not currently intend to take advantage of the controlled company exemptions, we cannot assure you that, in the future, we will not seek to take advantage of these exemptions.

Our failure to meet the continued listing requirements of the Nasdaq could result in a delisting of our common stock and could make it more difficult to raise capital in the future.

Nasdaq has listing requirements for inclusion of securities for trading on the Nasdaq, including minimum levels of stockholders’ equity, market value of publicly held shares, number of public stockholders and stock price. There can be no assurance that we will be successful in maintaining our listing on the Nasdaq as it is possible that we may fail to satisfy the continued listing requirements, such as the corporate governance requirements or the minimum stock price requirement. If we fail to satisfy the continued listing requirements, the Nasdaq may take steps to delist our common stock. Such a delisting, or the announcement of such delisting, will have a negative effect on the price of our common stock and would impair your ability to sell or purchase our common stock when you wish to do so. In the event of a delisting, we may attempt to take actions to restore our compliance with the Nasdaq listing requirements, but we can provide no assurance that any such action taken by us would allow our common stock to become listed again, stabilize the market price or improve the liquidity of our common stock, prevent our common stock from dropping below the Nasdaq minimum listing requirements or prevent future non-compliance with the Nasdaq listing requirements. If we do not maintain the listing of our common stock on the Nasdaq, it could make it harder for us to raise additional capital in the long-term. If we are unable to raise capital when needed in the future, we may have to cease or reduce operations.

Our financial situation creates doubt whether we will continue as a going concern.

There can be no assurances that we will ever be able to achieve a level of revenues adequate to generate sufficient cash fflow from operations or obtain additional financing through private placements, public offerings and/or bank financing necessary to support our working capital requirements. To the extent that funds generated from any private placements, public offerings and/or bank financing are insufficient, we will have to raise additional working capital and no assurance can be given that additional financing will be available, or, if available, will be on acceptable terms. The recent interest rate hikes and the present conditions and state of the United States and global economies make it difficult to predict whether and/or when and to what extent a recession has occurred or will occur in the near future. These conditions potentially raise substantial doubt about our ability to continue as a going concern. If adequate working capital is not available, we may be forced to discontinue operations, which would cause investors to lose their entire investment.

The price of our common stock may be volatile and fluctuate substantially, which could result in substantial losses for purchasers of our common stock in this offering.

Our common stock price is likely to be volatile. The stock market has experienced extreme volatility that has often been unrelated to the operating performance of particular companies. As a result of this volatility, you may not be able to sell your common stock at or above the initial public offering price. The market price for our common stock may be influenced by many factors, including:

If our quarterly operating results fall below the expectations of investors or securities analysts, the price of our common stock could decline substantially. Furthermore, any quarterly fluctuations in our operating results may, in turn, cause the price of our stock to fluctuate substantially. We believe that quarterly comparisons of our financial results are not necessarily meaningful and should not be relied upon as an indication of our future performance.

In the past, following periods of volatility in the market price of a company’s securities, securities class-action litigation often has been instituted against that company. Such litigation, if instituted against us, could cause us to incur substantial costs to defend such claims and divert management’s attention and resources.

Because we do not expect to pay dividends for the foreseeable future, investors seeking cash dividends should not purchase shares of common stock.

We have never declared or paid any cash dividends on our common stock. We currently intend to retain future earnings, if any, to finance the expansion of our business. As a result, we do not anticipate paying any cash dividends in the foreseeable future. Our payment of any future dividends will be at the discretion of our board of directors of Directors after taking into account various factors, including but not limited to our financial condition, operating results, cash needs, growth plans and the terms of any credit agreements that we may be a party to at the time. Accordingly, investors must rely on sales of their common stock after price appreciation, which may never occur, as the only way to realize any future gains on their investments. Furthermore, our Credit Agreement contains negative covenants that limit our ability to pay dividends. For more information, see the section titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations - Liquidity and Capital Resources.”

Although we intend to apply to list our common stock on Nasdaq, an active trading market for our common stock may not develop.

Prior to this offering, no public market has existed for our common stock. Further, we intend to apply to list our common stock on Nasdaq, and there can be no assurance that we will be approved. Although this offering will not commence without the approval for the trading of our common stock on Nasdaq, an active trading market for our shares may never develop or be sustained following this offering. If an active market for our common stock does not develop, it may be difficult for you to sell shares you purchase in this offering without depressing the market price for the shares, or at all. An inactive market may also impair our ability to raise capital by selling our common stock and may impair our ability to expand our business by using our common stock as consideration in an acquisition.

We will be subject to additional regulatory burdens resulting from our public listing.

We are working with our legal, accounting and financial advisors to identify those areas in which changes should be made to our financial management control systems to manage our obligations as a public company listed on the Nasdaq. These areas include corporate governance, corporate controls, disclosure controls and procedures and financial reporting and accounting systems. We have made, and will continue to make, changes in these and other areas, including our internal controls over financial reporting. However, we cannot assure holders of our common stock that these and other measures that we might take will be sufficient to allow us to satisfy our obligations as a public company listed on the Nasdaq on a timely basis. In addition, compliance with reporting and other requirements applicable to public companies listed on the Nasdaq will create additional costs for us and will require the time and attention of management. We cannot predict the amount of the additional costs that we might incur, the timing of such costs or the impact that management’s attention to these matters will have on our business.

We may sell additional common stock or other securities that are convertible or exchangeable into common stock in subsequent offerings or may issue additional common stock or other securities to finance future acquisitions.

We cannot predict the size or nature of future sales or issuances of securities or the effect, if any, that such future sales and issuances will have on the market price of the common stock. Sales or issuances of substantial numbers of common stock or other securities that are convertible or exchangeable into common stock, or the perception that such sales or issuances could occur, may adversely affect prevailing market prices of the common stock. With any additional sale or issuance of common stock or other securities that are convertible or exchangeable into common stock, investors will suffer dilution to their voting power and economic interest in our company. Furthermore, to the extent holders of any stock options or other convertible securities convert or exercise their securities and sell the common stock they receive, the trading price of the common stock may decrease due to the additional amount of common stock available in the market.

To the extent we may issue additional equity interests, our stockholders’ percentage ownership interest in our Company would be diluted. In addition, depending upon the terms and pricing of any additional offerings, the use of the proceeds and the value of our real estate investments, you may also experience dilution in the value of your shares and in the earnings and dividends per share.

Upon its effectiveness, our Certificate of Incorporation will provide that the Court of Chancery of the State of Delaware will be the exclusive forum for certain disputes between us and our stockholders, which could limit our stockholders’ ability to obtain a favorable judicial forum for disputes with us or our directors, officers or employees.

Upon its effectiveness, our Certificate of Incorporation will provide that, with certain limited exceptions, the Court of Chancery of the State of Delaware will be the exclusive forum for:

This exclusive-forum provisions may limit a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or our directors, officers or other employees, which may discourage lawsuits against us and our directors, officers and other employees. Any person or entity purchasing or otherwise acquiring any interest in any of our securities shall be deemed to have notice of and consented to this provision. There is no certainty that a court located outside of Delaware would give effect to this provision in any given case. If a court were to find this exclusive-forum provision in our Certificate of Incorporation to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving the dispute in other jurisdictions.

We are an emerging growth company and a smaller reporting company and intend to take advantage of reduced disclosure requirements applicable to emerging growth companies, which could make the common stock less attractive to investors.

We are an “emerging growth company” (“EGC”) as defined in the Jumpstart Our Business Startups Act of 2012. we will remain an EGC until the earliest to occur of (i) the last day of the fiscal year in which it has total annual gross revenue of $1.235 billion or more; (ii) the last day of the fiscal year following the fifth anniversary of the date of the first sale of common stock pursuant to this registration statement; (iii) the date on which it has issued more than $1.0 billion in non-convertible debt securities during the prior three-year period; or (iv) the date it qualifies as a “large accelerated filer” under the rules of the SEC, which means the market value of the common stock held by non-affiliates exceeds $700 million as of the last business day of its most recently completed second fiscal quarter after it has been a reporting company in the United States for at least 12 months. For so long as we remain an EGC, it is permitted to and intends to rely upon exemptions from certain disclosure requirements that are applicable to other public companies that are not EGCs. These exemptions include not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act (“SOX”).

We may take advantage of some, but not all, of the available exemptions available to EGCs. We cannot predict whether investors will find the common stock less attractive if it relies on these exemptions. If some investors find the common stock less attractive as a result, there may be a less active trading market for the common stock and the price of the common stock may be more volatile.

We are also a smaller reporting company, as defined in Rule 405 promulgated under the Securities Act (“SRC”). As an SRC, our company intends to utilize certain reduced disclosure requirements, including publishing two years of audited financial statements instead of three years, as required for companies that do not qualify as an SRC. Our company will remain an SRC until the last day of the fiscal year in which it had (i) a public float that exceeded $250 million or (ii) annual revenues of more than $100 million and a public float that exceeded $700 million. To the extent our company takes advantage of such reduced disclosure obligations, it may make comparison of its financial statements to those of other public companies difficult or impossible.

After our company ceases to be an SRC, it is expected to incur additional management time and cost to comply with the more stringent reporting requirements applicable to companies that are accelerated filers or large accelerated filers, including complying with the auditor attestation requirements of Section 404 of SOX.

We own or otherwise have rights to the trademarks, service marks, and copyrights, including those mentioned in this prospectus, used in conjunction with the operation of our business. This prospectus includes our own trademarks, which are protected under applicable intellectual property laws, as well as trademarks, service marks, copyrights, and tradenames of other companies, which are the property of their respective owners. We do not intend our use or display of other companies’ trademarks, service marks, copyrights, or tradenames to imply a relationship with, or endorsement or sponsorship of us by, any other companies. Solely for convenience, trademarks and tradenames referred to in this prospectus may appear without the ^®, ^™, or SM symbols, but such references are not intended to indicate, in any way, that we will not assert, to the fullest extent under applicable law, our rights to these trademarks and tradenames.

As of the date of this prospectus, we have applied for 2 trademarks and has filed a provisional patent application for the reAlpha Score. As of the date of this prospectus, the Company has the following pending applications for federal trademarks and a license to use the following federal trademark in the United States:

Registered Stockholders may, or may not, elect to sell or distribution, as applicable, shares of our common stock covered by this prospectus. To the extent any Registered Stockholder chooses to sell or distribution, as applicable, shares of our common stock covered by this prospectus, we will not receive any proceeds from any such sales of our common stock. See “Principal and Registered Stockholders.”

There is currently no market for our common stock. We intend to apply to list on Nasdaq under the symbol “[●]”.

On April 17, 2023, there were 3,123 holders of record of the Company’s common stock.

We have never declared or paid any cash dividend on our capital stock. We do not anticipate paying any cash dividends in the foreseeable future and we intend to retain all of our earnings, if any, to finance our growth and operations and to fund the expansion of our business. Payment of any dividends will be made in the discretion of our board of directors. Our board of directors may take into account general and economic conditions, our financial condition and results of operations, our available cash and current and anticipated cash needs, capital requirements, contractual, legal, tax and regulatory restrictions and implications on the payment of dividends by us to our stockholders or by our subsidiaries to us and such other factors as our board of directors may deem relevant. In addition, our ability to pay dividends is limited by our credit facilities and may be limited by covenants of other indebtedness we or our subsidiaries incur in the future.

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the information presented in our historical combined financial statements and the related notes included elsewhere in this prospectus. In addition to historical information, the following discussion contains forward-looking statements, such as statements regarding our expectation for future performance, liquidity and capital resources, which involve risks, uncertainties and assumptions that could cause actual results to differ materially from our expectations. Our actual results may differ materially from those contained in or implied by any forward-looking statements. Factors that could cause such differences include those identified below and those described in “Information Regarding Forward-Looking Statements,” “Risk Factors” and “Financial Information.”

Our business model is built around acquiring short-term rental properties that meet its internal investment criteria, which it calls Target Properties. Once acquired, we plan to renovate these properties to prepare them for rent and list them on short-term rental sites. We also plan to manage the financial performance of these assets, which includes evaluating the property’s after-repair value and profitability.

To make this business model available to retail investors, we plan to offer interest in each property portfolio through exempt offerings directed at those investors. The investors who participate in these offerings are called Syndicate Members. We expect that in the future, these Syndicate Members will purchase minority interests in the Company’s acquired properties.

Our goal is to achieve consistent cash flow from short-term tenants, long-term capital appreciation, favorable tax treatment of long-term capital gains, and capital preservation. To finance these property acquisition investments, the company may engage in leverage financing. This involves a combination of senior financing on its real estate acquisitions, secured facilities, and capital markets financing transactions.

We plan to secure conservatively structured leverage that is long-term, non-recourse, and non-mark-to-market financing. It intends to manage credit risk and interest rate risk associated with these financings by monitoring credit risk and other risks of loss associated with each investment and its overall credit risk and levels of provision for loss. Additionally, we will follow an interest rate risk management policy intended to mitigate the negative effects of major interest rate changes. This includes attempting to “match-fund,” which means that it will structure the key terms of its borrowings to generally correspond with the expected holding period of its assets. We have already started its first syndication of one of its Orlando properties.

The three months ended January 31, 2023, compared to the three months ended January 31, 2022

Revenues. Total revenues were $37,070 for the three months ended January 31, 2023 compared to $95,000 for the three months ended January 31, 2022. Our revenues consist of short-term rental revenue that we receive from our listed properties. The decline in revenue for the period ending January 31, 2023, can be attributed to a decrease in the number of properties listed compared to January 31, 2022, as we are in the process of discontinuing our Dallas, Texas operations by selling most of the properties we previously had in that market.

Cost of Sales. Total cost of sales was $7,785 for the three months ended January 31, 2023 compared to $24,781 for the three months ended January 31, 2022. The decrease in the cost of sales for the three months ended January 31, 2023, is attributed to a reduction in the property management fee. This fee is charged based on the revenue earned, and since the revenue declined for the three months ended January 31, 2023, due to a decrease in the number of properties listed as compared to January 31, 2022, it resulted in a decline in the cost of sales.

Gross Profit. Gross profit was $29,285 for the three months ended January 31, 2023, compared to $70,219 for the same period of 2022. The decrease in gross profit is mainly attributed to a decline in revenue resulting from a decrease in property management fees and host charges associated with our listed properties compared to the three months ended January 31, 2022.

Gross Margin. Gross margin was 78.9% for the three months ended January 31, 2023, compared to 73.9% for the same period of 2022. The increase in gross margins of 5% during the three months ended January 31, 2023, is mainly due to the decrease in property management fees and host charges associated with our listed properties, which had been charged to us by Airbnb for hosting our properties during three months ended January 31, 2022.

General, Administrative and other Non-Operating Expenses. General administrative and other non-operating expenses were $1,495,788 for the three months ended January 31, 2023 compared to $1,432,924 for the three months ended January 31, 2022. This increase in general administrative and other non-operating expenses can be attributed to a minor rise in legal expenses.

Operating Expense. We recognized operating expense of $67,683 for the three months ended January 31, 2023, compared to $70,372 for the three months ended January 31, 2022. The reduction in expenses is attributable to a lower number of properties compared to January 31, 2022. Operating expenses includes utilities, repairs, maintenance, property insurance costs, property taxes, depreciation, amortization and others.

Net Loss. Net loss was $1,534,186 for the three months ended January 31, 2023, compared to $1,430,866 in the prior year comparable period. This increase in net loss is attributable to a decline in revenues due to decrease in the number of properties listed compared to January 31, 2022, and an increase in our non-operating expenses due to our increased legal expenses during such period.

The nine months ended January 31, 2022, compared to the nine months ended January 31, 2021

Revenues. Total revenues were $96,860 for the nine months ended January 31, 2023 compared to $168,771 for the nine months ended January 31, 2022. The decline in revenue for the nine months ended January 31, 2023, can be attributed to a decrease in the number of properties listed compared to January 31, 2022, as we disposed of certain properties, including most of the properties we previously had in the Dallas, Texas market. Our revenues consist of short-term rental revenue that we receive from our listed properties.

Cost of Sales. Total cost of sales was $20,336 for the nine months ended January 31, 2023 compared to $37,758 for the nine months ended January 31, 2022. The decrease in the cost of sales for the nine months ended January 31, 2023, is attributed to a reduction in the property management fee. This fee is charged based on the revenue earned, and since the revenue declined for the nine months ended January 31, 2023, due to a decrease in the number of properties listed as compared to January 31, 2022, it resulted in a decline in the cost of sales.

Gross Profit. Gross profit was $76,524 for the nine months ended January 31, 2023, compared to $131,103 for the same period of 2022. The revenue is not inclusive of the sale amount from these disposed properties. It included only the short-term rentals amount generated from the properties during their listing period.

Gross Margin. Gross margin was 79.0% for the nine months ended January 31, 2023, compared to 77.6% for the same period of 2022. The increase in gross margins of 1.4% during the nine months ended January 31, 2023, is mainly due to the decrease in property management fees and host charges associated with our listed properties, which had been charged to us by Airbnb for hosting our properties during nine months ended January 31, 2022.

General, Administrative and other Non-Operating Expenses. General administrative and other non-operating expenses were $3,004,491 for the nine months ended January 31, 2023, compared to $1,956,136 for the nine months ended January 31, 2022. The Increase can be attributed to a rise in legal expenses in connection with our Regulation A offering and general business operations.

Operating Expense. We recognized operating expenses of $211,366 for the nine months ended January 31, 2023 compared to $208,508 for the nine months ended January 31, 2022. Operating expenses includes utilities, repairs, maintenance, property insurance costs, property taxes, depreciation, amortization and others. The rise in expenses is attributable to an increase in depreciation and amortization costs compared to January 31, 2022.

Net Loss. Net loss was $3,149,333 for the nine months ended January 31, 2023, compared to $2,025,549 in the prior year comparable period. This increase in net loss was due to a decline in revenue, which was due to a decrease in the number of properties listed compared to the nine months ended January 31, 2022 period, and increase in the non-operating expenses, such as increased legal expenses.

The fiscal year ended April 30, 2022, compared to the fiscal year ended April 30, 2021

Revenues. Total revenues were $229,672 for the fiscal year ended April 30, 2022, compared to $784 for the fiscal year ended April 30, 2021. The revenue increase for the period ending April 30, 2022, is due to the fact that we were formed on April 22, 2021, and the fiscal year ended on April 30, 2021, hence it only reflected 8 days of operations, compared to the year ended April 30, 2022 (i.e. 365 days). Our revenues consist of short-term rental revenue that we receive from our listed properties.

Cost of Sales. Total cost of sales was $55,717 for the fiscal year ended April 30, 2022, compared to $199 for the fiscal year ended April 30, 2021. The increase in the cost of sales for the fiscal year ended April 30, 2022, is attributed to the fact that our operations began on April 22, 2021, and the fiscal year ended on April 30, 2021, hence it only reflected 8 days of operations, compared to the year ended April 30, 2022 (i.e. 365 days).

Gross Profit. Gross profit was $173,955 for the fiscal year ended April 30, 2022, compared to $585 for the same period of 2021. The increase for the period ending April 30, 2022, is due to the fact that we were formed on April 22, 2021, and our fiscal year ended on April 30, 2021, hence it only reflected 8 days of operations, compared to the year ending April 30, 2022 (i.e. 365 days).

Gross Margin. Gross margin was 75.7% for the fiscal year ended April 30, 2022, compared to 74.6% for the same period of 2021. The increase in gross margins during the fiscal year ended April 30, 2022, is mainly due to the fact that we were formed on April 22, 2021, and the fiscal year ended on April 30, 2021, hence it only reflected 8 days of operations, compared to the year ended April 30, 2022 (i.e. 365 days).

General, Administrative and other Non-Operating Expenses. General administrative and other non-operating expenses were $2,995,365 for the fiscal year ended April 30, 2022 compared to $2,809 for the fiscal year ended April 30, 2021. The increase for the fiscal year ended April 30, 2022, is due to the fact that we were formed on April 22, 2021, and the fiscal year ended on April 30, 2021, hence it only reflected 8 days of operations, compared to the year ended April 30, 2022 (i.e. 365 days).

Operating Expense. We recognized operating expense of $381,932 for the fiscal year ended April 30, 2022 compared to $1,189 for the fiscal year ended April 30, 2021. Operating expenses includes utilities, repairs, maintenance, property insurance costs, property taxes, depreciation, amortization and others. The operating expenses increase for the period ended April 30, 2022, is due to the fact that we were formed on April 22, 2021, and the fiscal year ended on April 30, 2021, hence it only reflected 8 days of operations, compared to the year ended April 30, 2022 (i.e. 365 days).

Net Loss. Net loss was $3,190,038 for the fiscal year ended April 30, 2022, compared to $3,342 for the fiscal year ended April 30, 2021. The decrease in net loss for the period ended April 30, 2022, is due to the fact that we were formed on April 22, 2021, and the fiscal year ended on April 30, 2021, hence it only reflected 8 days of operations, compared to the year ending April 30, 2022 (i.e. 365 days).

Liquidity describes the ability of a company to generate sufficient cash flows to meet the cash requirements of its business operations, including working capital needs, debt services, acquisitions, contractual obligations and other commitments. As of the date of this prospectus, we have yet to generate meaningful revenue from our business operations and have funded acquisitions, capital expenditure and working capital requirement through equity and debt financing.

Our liquidity and capital resources are critical to our ability to execute on our business plan and achieve our strategic objectives. We anticipate that we will require working capital in the next 12 months to finance our growth and support our operations. Accordingly, we will need to raise additional capital by securing additional financing. The timing, size, and terms of any such offering have not yet been determined. To the extent the Company requires additional funds more than 12 months from the date hereof, and collections from our short-term rentals cannot fund our needs, the Company may utilize equity offerings to raise these funds. We cannot provide any assurance that we will be able to raise additional funds on acceptable terms, if at all. Our ability to raise additional capital will depend on various factors, including market conditions, investor demand, and our financial performance.

Our business model requires significant capital expenditures to build and maintain the infrastructure and technology required to support our operations. In addition, we may incur additional costs associated with research and development of new products and services, expansion into new markets or geographies, and general corporate overhead. As a result, we may require additional financing in the future to fund these initiatives, which may include additional equity or debt financing or strategic partnerships. We currently do not have any commitments or arrangements for additional financing, and there can be no assurance that we will be able to obtain additional financing on terms acceptable to us, or at all. If we are unable to obtain additional financing when required, we may be forced to reduce the scope of our operations, delay the launch of new products or services, or take other actions that could adversely affect our business, financial condition, and results of operations. We may also be required to seek additional financing on terms that are unfavorable to us, which could result in the dilution of our stockholders’ ownership interests or the imposition of burdensome terms and restrictions.

The following table summarizes our cash flows from operating, investing and financing activities for the periods presented.

Net cash used in operating activities was $(4,478,549) and $(30,482) for the nine months ended January 31, 2023 and 2022, respectively. The increase in net cash flows used in operating activities as compared to the same period in 2022 was primarily driven by general, administrative and legal expenses in relation with Regulation A fund raising and other related activities.

Net cash used in operating activities was $(1,558,025) for the year ended April 30, 2022, compared to $(11,326) for the year ended April 30, 2021. The difference in net cash flows used in operating activities as compared to the same period in 2022 is primarily due to the business was operating for a significantly shorter duration (i.e., 8 days since April 22, 2021 inception date) during the period ended April 30, 2021 compared to the year ending April 30, 2022, which operated for the whole year (i.e. 365 days).

Our cash flows from investing activities have been comprised primarily of purchases and sales of real estate properties and improvements to those properties.

Net cash used in investing activities was $1,687,271 and $(2,322,374) for the nine months ended January 31, 2023 and 2022, respectively. The increase in inflow from investing was primarily due to the sale of real estate properties during the nine months ended January 31, 2023.

Net cash used in investing activities was $(2,645,816) for the year ended April 30, 2022, compared to $(98,189) for the year ended April 30, 2021. The increase was primarily due to purchases of new properties during the year ended April 30, 2022 and also due to the business was operating for a significantly shorter duration (i.e., 8 days) during the period ended April 30, 2021 compared to the year ending April 30, 2022 (i.e. 365 Days). As the company got incorporated on 22^nd April, 2021.

We have financed our operations primarily through sales of equity securities, loans and advances.

Net cash provided by financing activities was $3,644,095 and $4,485,184 for the nine months ended January 31, 2023 and 2022, respectively. The increase in net outflow is primarily consists of mortgage loan payment.

Net cash provided by financing activities was $5,533,173 and $442,735 for the year ended April 30, 2022 and 2021, respectively. The increase in net inflow is primarily consists of mortgage loan receipts and Regulation A Settlement stock subscription during the year end April 30, 2022.

Our contractual obligations as of April 30, 2022 include existing mortgage loans of the 5 properties currently owned by the Company. Monthly mortgage interest amounts will vary due to interest rate fluctuation, and as of April 30, 2022 they were approximately as follows:

This discussion and analysis of our financial condition and results of operations are based upon our consolidated financial statements, which have been prepared in accordance with GAAP. The preparation of these statements requires management to make estimates and judgments that affect the reported amounts of assets and liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities at the date of our consolidated financial statements. Actual results may differ from these estimates under different assumptions or conditions.

Critical accounting policies are defined as those that involve significant judgment and potentially could result in materially different results under different assumptions and conditions. Management believes the following critical accounting policies are affected by our more significant judgments and estimates used in the preparation of our consolidated financial statements.

Revenue Recognition: Our revenues primarily consist of short-term rental revenues. We have the following revenue sources and revenue recognition policies:

Investment Property and Equipment and Depreciation: Property and equipment are carried at cost. Depreciation for buildings is computed principally on the straight-line method over the estimated useful lives of the assets (27.5 years). Depreciation of improvements to buildings, rental homes and equipment, and vehicles is computed principally on the straight-line method over the estimated useful lives of the assets (ranging from 3 to 27.5 years). Land & its development costs are not depreciated but are capitalized as Land and land improvements. Interest expenses, Maintenance, and repairs are charged to expenses as incurred and improvements are capitalized. The costs and related accumulated depreciation of property sold or otherwise disposed of are removed from the financial statements and any gain or loss is reflected in the current year’s results of operations.

Impairment Policy: The Company applies FASB ASC 360-10, “Property, Plant and Equipment,” to measure impairment in real estate investments. Rental properties are individually evaluated for impairment when conditions exist which may indicate that it is probable that the sum of expected future cash flows (on an undiscounted basis without interest) from a rental property is less than the carrying value under its historical net cost basis. These calculations of expected future cash flows consider factors such as future operating income, trends, and prospects, as well as the effects of leasing demand, competition, and other factors. Upon determination that a permanent impairment has occurred, rental properties are reduced to their fair value. For properties to be disposed of, an impairment loss is recognized when the fair value of the property (less the estimated cost to sell) is less than the carrying amount of the property measured at the time there is a commitment to sell the property and/or it is actively being marketed for sale. A property to be disposed of will be reported at the lower end of the carrying amount or its estimated fair value, less its cost to sell. Subsequent to the date that a property is held for disposition, depreciation expense is not recorded.

Income Taxes: We account for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, we determine deferred tax assets and liabilities on the basis of the differences between the financial statement and tax bases of assets and liabilities by using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. We recognize deferred tax assets to the extent that we believe that these assets are more likely than not to be realized. In making such a determination, we consider all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, and results of recent operations. If we determine that we would be able to realize our deferred tax assets in the future in excess of their net recorded amount, we would make an adjustment to the deferred tax asset valuation allowance, which would reduce the provision for income taxes. We record uncertain tax positions in accordance with ASC 740 on the basis of a two-step process in which (1) we determine whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, we recognize the largest amount of tax benefit that is more than 50 percent likely to be realized upon the ultimate settlement with the related tax authority. We recognize interest and penalties, if any, with income tax expense in the accompanying consolidated statement of operations.

In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” ASU 2016-13 requires that entities use a new forward looking “expected loss” model that generally will result in the earlier recognition of allowance for credit losses. The measurement of expected credit losses is based upon historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. ASU No. 2016-13 is effective for annual reporting periods, including interim reporting periods within those periods, beginning after December 15, 2022. The Company is currently evaluating the potential impact this standard may have on the consolidated financial statements.

The JOBS Act permits an emerging growth company such as us to take advantage of an extended transition period to comply with new or revised accounting standards applicable to public companies until those standards would otherwise apply to private companies. We have irrevocably elected to apply this extended transition period and, as a result, we will not adopt new or revised accounting standards on the relevant dates on which adoption of such standards is required for public entities. Accordingly, our financial statements may not be comparable to other public companies that do not elect the extended transition period.

Our business model is built around providing retail investors with the opportunity to participate in short-term rental properties we will acquire by offering interest in each property portfolio. We intend to make that opportunity available pursuant to exempt offerings directed at those retail investors through syndications, which investors we call “Syndicate Members,” as described below. We are focusing on the short term rental industry since it is highly fragmented and is ideal for consolidation from both a real estate, technology and artificial intelligence perspective. According to public filings from Airbnb, Inc. (“Airbnb”), the total market size is estimated to be $1.2T.

We intend to focus our business efforts on the markets in which Airbnb operates, which include some or all of the following characteristics:

During our testing phase, we started acquiring properties in our initial geographic market of Dallas, Texas as a proof of concept. Now, we have moved into the Orlando, Florida market. We believe that this market offers strong growth in population, jobs, rental rates, and value appreciation. Additionally, we have selected Tampa, Ft. Lauderdale, and Panhandle areas in Florida as our next markets.

We also intend to regularly consider acquiring properties outside of these ranges depending on market conditions, uniqueness, and condition of the Target Property.

While we will employ our proprietary artificial intelligence technology and our real estate professionals to identify suitable properties for acquisition, the Company will be responsible for final decisions. We will use the methodology described below and our bespoke technologies to reach buy or sell decisions. We have developed an investment approach that combines the experience of our management, the reAlpha Score and an approach that emphasizes market research, underwriting standards and down-side analysis of the risks of each investment.

To execute our disciplined investment approach, we plan to closely monitor the profit and loss of each investment.

We will research the acquisition and underwriting of each transaction. The research will focus on finding any “red flags” to acquire a property. These “red flags” include (i) heavy regulation on short-term rentals at a state, county, or homeowner’s association (“HOA”) level; (ii) homes that have been on the market for longer than a year, or (iii) areas where natural disasters are extremely common and damaging. Additionally, we consider things such as tourist numbers and market size, seasonality, walkability, proximity to airports, restaurants and entertainment and events that would attract renters.

Market Analysis. When entering a market that we do not currently own property. We first determine what the demographic and real estate relate trends have been. More specifically, we look to see positive trends in statistics such as, but not limited to:

Submarket Analysis. In our submarket analysis, we look for all the same stats/trends as completed at the market level but for a smaller geographical area such as a specific city and/or zip code. Additionally, we will look to see positive trends in statistics such as, but not limited to:

Property Analysis. In our property analysis, we look to analyze the subject property or properties to determine:

We will examine all elements of a potential investment, including, with respect to real property, its location, income-producing capacity, prospects for long-range appreciation, tax considerations and liquidity. Utilizing the market, submarket and property analysis, we develop a complete pro forma calculation from acquisition through projected sale is completed for each property or portfolio of properties acquired. Each pro forma calculation must meet the required minimum metrics threshold set by the company prior to making a formal investment.

Operating or performance risks generally arise at the investment level and often require real estate operating experience to cure, as described in the “Risk Factors” section below. We will review the current operating performance of property investments against our internal projections and provide the oversight necessary to detect and resolve issues as they arise.

Prior to the purchase of a property, we will develop a property business strategy, which will be customized based on the acquisition and underwriting data. Our property business strategy is a forecast of the action items to be taken and the capital needed to achieve the targeted returns for a Target Property. The property business strategy includes: (i) offer amount and negotiations, (ii) financing structure, (iii) furniture and design, (iv) achieving the most beneficial holding period for the property, (v) tax strategy and (vi) exit strategy. These strategies will be customized based on data found during the due diligence process for each of Target Property to adapt to economic conditions, seasonality, and the unique factors of each market.

Properties and/or portfolios of acquired properties will have annual budgets completed prior to the commencement of any given operating year. Quarterly financials will include variance to pro forma calculations and budget reports. Variances greater than 15% for any line item that exceeds an amount equal to $10,000 shall include an explanation of said variance.

Once we have decided to acquire a property using our Investment Criteria, we intend to use the following steps to maximize its value:

Our business model is based on a digital marketplace with design and functions incorporating elements of multiple growing markets more fully described below:

Airbnb is an online community marketplace for people to list, discover, book and rent accommodations through easy-to-use technology. Platforms like Airbnb have increased traveler accommodation by enabling “home-sharing” on a global scale. Because of its scale and brand recognition, Airbnb has been chosen as the platform to market and operate our short-term rental properties.

We intend to offer standardized and personalized experiences like those provided by individual hosts within the Airbnb system but at the scale and efficiency of professional hosts. Airbnb continues to grow its host community in size and quality though consistent investment. According to Airbnb’s public filings, about 90% of Airbnb’s hosts are individual hosts with the majority having just a single listing. Professional hosts, such as property management companies, serviced apartment providers, and boutique hotels comprise only 10% of the host community.

According to Market Insider, retail investors still remain very active in the United States making up nearly 10% of US equity trading in the Russell 3000 (Jun 30, 2021; Retail trading has cooled from its pandemic peak, but still makes up 10% of stock trading volume in the US, Morgan Stanley says). The barrier-to-entry for brokerage applications has decreased, which in turn, has created easier access to the market. Simultaneously, the emerging demographic of first-time investors is typically young people. Evidence has shown that approximately 78% of Robinhood users are under the age of 35, according to Fast & Company (August 14, 2017; How Brokerage App Robinhood Got Millennials to Love the Market). Furthermore, due to the COVID-19 pandemic, there has been a substantial increase of 3 million retail investors on Robinhood in Q1 2020. As of December 2022, Robinhood has 11.4M monthly active users on their platform. A remarkable 83% of those who received stimulus checks in May 2020 invested half into the market, according to Mirae Assets (October, 15, 2020; The Renewed Rise of The Retail Investor). These macro trends are important to note because they signify the rapidly expanding growth of Millennial and Fintech investing.

We are expanding the democratization of inaccessible markets, which will revolutionize personal finances through the adoption of fractionalized ownership. A Company like ours will allow individuals with less capital and less direct involvement to invest in real estate projects.

Integration of disconnected technology ecosystems refers to disruption created by companies like Stripe, which is a provider of payments infrastructure for the internet. Millions of businesses use Stripe’s software and APIs to accept payments, send payouts, and manage their businesses online. Stripe took a fragmented industry and created a fully integrated suite of payments products that bring together everything that is required to build websites and apps that accept payments and send payouts globally. There is an opportunity to utilize our core technological capabilities to unite the fragmented ecosystem currently serving markets like Airbnb.

The consolidation of single-family homes backed by institutional capital is a relatively recent phenomenon that has become standard in the industry today. The single-family rental market was previously composed of a small percentage of institutionally owned rental homes. Companies like Invitation Homes entered the market and stepped in front of non-permanent capital investors that were looking to liquidate their portfolios.

This paved the way for longer-term, permanent capital entities with more established operating scale, providing growth opportunities beyond the underlying market growth. With increasing scale brought about by companies like Invitation Homes, the single-family rental sector has been able to deliver better operating efficiency.

The travel industry has been grappling with the impacts of the COVID-19 pandemic for over two years now. However, according to Airbnb CEO Brian Chesky, the company is poised for its best quarter yet, despite concerns over the economic slowdown. In a recent interview with Bloomberg Television, Chesky expressed confidence in the future of the travel industry, stating that regardless of the macroeconomic environment, people will continue to want to live on Airbnb and travel.

Despite rising inflation levels, consumers have continued to splurge on travel rentals, suggesting a strong demand for vacation accommodation. With vaccination rates increasing and travel restrictions easing, it is likely that the demand for travel rentals will continue to grow, providing opportunities for Airbnb and other companies in the industry. As the pandemic situation continues to evolve, it is important for travel industry players to stay agile and adapt to changing consumer needs and safety protocols to ensure they can meet the demands of travelers in this new environment.

Resurgence of the travel market is expected to happen once the COVID-19 pandemic wanes. This will likely increase the demand for hosts’ multi-fold. In an interview aired by CNBC “TechCheck”, Airbnb CEO, Brian Chesky expects that more guests will flock to Airbnb than the platform’s four million hosts can accommodate due to expected resurging travel not seen in recent times.

According to a survey of a census-balanced sample of 1,994 U.S. adults conducted by the payments and commerce content platform, PYMNTS.com, about 65% of surveyed consumers want to re-engage in the physical world for fun and leisure activities, such as seeing friends and family and attending sporting events and concerts. According to the survey, about 60% of surveyed consumers said they want to be able to travel within the U.S. again.

New home sales continue to be buoyant. Sales of new single-family houses in the US increased 1.1% month-over-month to a seasonally adjusted annual rate of 640,000 units in February 2023, according to estimates released jointly by the U.S. Census Bureau and the Department of Housing and Urban Development, which is the highest level since August of the previous year.

According to the National Association of Home Builders (NAHB) estimates, the total count of second homes, vacation homes, and investment properties was 7.5 million, accounting for 5.5% of the total housing stock. These second homes account for 15% of new single-family home sales. Nearly 50% of those second homes are rented out using professional management companies.

The company is currently developing four technologies. However, this is only part of our technology roadmap. We strive to continue innovating for our benefit and for the benefit of our Syndicate Members by using better wealth-creation tools, as well as generating returns by leveraging new technologies to optimize guest experience.

The industry in which we plan to operate and compete is subject to rapid technological developments, evolving industry standards, changes in customer requirements and competitive new products and features. As a result, we believe our success, in part, will depend on our ability to build and enhance our technology and artificial intelligence capabilities in a timely and efficient manner and to develop and introduce those technologies while reducing total cost of ownership. To achieve these objectives, we have made research and development investments through third-party acquisitions to facilitate the development of our technologies, and we may explore in the future third-party licensing agreements.

An example of our third-party acquisitions include our ownership of a 25% stake in Naamche Inc., an artificial intelligence (“AI”) studio, and a 25% stake Carthagos Inc., a design studio (“Carthagos”). Naamche, Inc. has assisted us in research and development of our proprietary algorithms and other technologies. This acquisition is expected to enhance our technological capabilities, broaden its portfolio of services, and contribute towards cost savings, positioning them for growth and success in the future.

We have a dedicated marketing department responsible for various aspects of the company’s marketing initiatives and strategies. The department’s primary responsibilities include:

Our marketing department collaborates with Carthagos, a design agency that we partially own. Carthagos is responsible for visual content creation and design such as UI/UX design, social media visuals, and advertising collateral.

Our business operations and properties are subject to various covenants, laws, ordinances, and rules. We believe that we are in material compliance with such covenants, laws, ordinances, and rules, and we also require that our residents agree to comply with such covenants, laws, ordinances, and rules in their leases with us.

The Fair Housing Act (“FHA”) and its state law counterparts, and the regulations promulgated by the United States Department of Housing and Urban Development and various state agencies, prohibit discrimination in housing on the basis of race or color, national origin, religion, sex, familial status (including children under the age of 18 living with parents or legal custodians, pregnant women, and people in the process of adopting a child or securing custody of children under the age of 18), disability or, in some states, financial capability.

Our properties are subject to various municipal regulations and orders, and county and city ordinances, including without limitation, use, operation and maintenance of our properties. Certain of our properties are subject to the rules of the various HOAs where such properties are located. HOA rules and regulations are commonly referred to as “covenants, conditions and restrictions,” or CC&Rs, and typically consist of various restrictions or guidelines regarding use and maintenance of the property, including, among others, noise restrictions or guidelines as to how many cars may be parked on the property.

We own an in-house brokerage to serve our investors and utilize in-market leasing experience specialists to drive an end-to-end resident experience that achieves our occupancy, revenue, and retention goals while facilitating enjoyment of a worry-free leasing lifestyle. Our in-house brokerage is subject to numerous federal, state, and local laws and regulations that govern the licensure of real estate brokers and affiliate brokers and set forth standards for, and prohibitions on, the conduct of real estate brokers. Such standards and prohibitions include, among others, those relating to fiduciary and agency duties, administration of trust funds, collection of commissions, and advertising and consumer disclosures, as well as compliance with federal, state, and local laws and programs for providing housing to low-income families. Under applicable state law, we generally have a duty to supervise and are responsible for the conduct of our in-house brokerage.

As a current or prior owner of real estate, we are subject to various federal, state, and local environmental laws, regulations, and ordinances, and we could be liable to third parties as a result of environmental contamination or noncompliance at our properties, even if we no longer own such properties. We are not aware of any environmental matters that would have a material adverse effect on our financial position (see “Risk Factors — Risks Related to Our Business and Industry”).

Data privacy laws and regulations in the U.S. and foreign countries apply to the access, collection, transfer, use, storage, and destruction of personal information in connection with our services. In the U.S., our financial institution customers are required to comply with privacy regulations imposed under the Gramm-Leach-Bliley Act, in addition to other regulations. As a processor of personal information in our role as a provider of services to financial institutions, we are bound by similar limitations on disclosure of the information received from our customers as apply to the financial institutions themselves. In addition, federal and state privacy and information security laws, and consumer protection laws, which apply to businesses that collect or process personal information, may also apply to our businesses.

There has been increased public attention regarding the use of personal information and data transfer, accompanied by legislation and regulations intended to strengthen data protection, information security and consumer and personal privacy. The law in these areas continues to develop and the changing nature of privacy laws in the U.S., the European Union (“E.U.”) and elsewhere could impact our processing of personal information of our employees and on behalf of our customers. In the E.U. the comprehensive General Data Privacy Regulation (the “GDPR”) went into effect in May 2018. The GDPR has introduced significant privacy-related changes for companies operating both in and outside the E.U. In the U.S., California has adopted the California Consumer Privacy Act, and Nevada has adopted the Nevada Privacy Law, both of which went into effect on January 2020, and several states are considering adopting similar laws imposing obligations regarding the handling of personal information. While we believe that we are compliant with our regulatory responsibilities, information security threats continue to evolve resulting in increased risk and exposure. In addition, legislation, regulation, litigation, court rulings, or other events could expose us to increased costs, liability, and possible damage to our reputation.

As of January 31, 2023, we had 9 full-time employees. We believe that we maintain good relations with our employees.

As of April 10, 2023, we owned and operated 5 properties located in Dallas, Texas, Kissimmee, Davenport, and Champions Gate in Florida. These 5 properties were renovated. Below are details of existing mortgage loans of the 5 properties. Monthly mortgage interest amounts will vary due to interest rate fluctuation. As of January 31, 2023, we paid monthly mortgage interest of $1,544 for 825 Austrian Road property, $9,472 for 790 Pebble Beach Drive, 612 Jasmine Lane and Amazonas Street Property and $3,608 for 2540 Hamlet Lane Property.

On May 2, 2022, we received a subpoena duces tecum and requests for depositions of three senior managers of the Company from the Ohio Division of Securities (the “ODS”), all related to the Company’s Regulation A+ securities offering in the State of Ohio, and based on Ohio Revised Code1707.23. The depositions were taken in July 2022. The ODS has not asserted any securities violations by the Company other than a late notice filing for its offering. The Company is fully cooperating with the ODS.

On April 15, 2022, we entered into a consent order (the “Consent Order”) with the Securities Division of the Office of the Secretary of the Commonwealth of Massachusetts (the “MSD”) following an investigation by the MSD into whether the Company had engaged in acts or practices that violated the Massachusetts Uniform Securities Act (the “Massachusetts Act”) and the regulations promulgated thereunder (the “Massachusetts Regulations”). For purposes of the Consent Order, the Company did not admit or deny the findings of fact or law or any of the allegations contained therein. The Consent Order provides that it is not intended to form the basis of any disqualification under Section 3(a)(39) of the Securities Exchange Act of 1934, or Rules 504(b)(3) and 506(d)(i) of Regulation D, Rule 262(a) of Regulation A and Rule 503(a) of Regulation CF under the Securities Act of 1933. Likewise, the Consent Order provides that it is not intended to form a basis of a disqualification under Section 204(a)(2) of the Uniform Securities Act of 1956 or Section 412(d) of the Uniform Securities Act of 2002. MSD alleged in the Consent Order that the Company initially failed to disclose an ongoing “criminal” proceeding taking place in India against the Company’s CEO that involves allegations of fraud and forgery. MSD also alleged that the Company posted sample stock images of properties on its website, along with corresponding property “scores,” purchase dates, and addresses, despite not actually owning these properties. MSD further alleged that the Company failed to disclose a potential conflict of interest in connection with the Company’s real estate acquisitions. The MSD finally alleged that the Company failed to notice file with the MSD and submit a consent for service of process before marketing and selling shares to investors in Massachusetts. In the Consent Order the MSD noted that “[e]xcept in any action by the Division to enforce the obligations of the Consent Order, any acts performed or documents executed in settlement of this matter: (A) may not be deemed or used as an admission of, or evidence of, the validity of any alleged wrongdoing, liability, or lack of any wrongdoing or liability; and (B) may not be deemed or used as an admission of, or evidence of, any such alleged fault or omission of the Company in any civil, criminal, arbitral, or administrative proceeding in any court, administrative agency, or tribunal.”

Under the terms of the Consent Order, the Company is censured, barred from offering or selling securities in Massachusetts, and ordered to cease and desist from committing future violations of the Massachusetts Act and the Massachusetts Regulations. Pursuant to the Consent Order, on April 21, 2022, the Company paid a $375,000 administrative fine and offered to rescind the purchases of each of the fourteen Massachusetts investors who acquired the Company’s common stock in its Regulation A offering. Such investors paid an aggregate amount of $19,500 to purchase the Company’s common stock. Seven out of the fourteen Massachusetts investors elected to rescind the purchase and the Company has already refunded them a total of $11,500. The Company has fully complied with the terms of the Consent Order.

The Company engaged counsel to make all the necessary securities filings. However, the Company’s then-counsel did not make any blue sky filings until MSD informed of such irregularity to the Company.

A copy of the Consent Order was filed on Form 1-U on April 15, 2022, as Exhibit 6.5 thereto, and is Exhibit 99.1 to the Offering Statement. For additional information on the Consent Order, we refer you to Exhibit 99.1. As of the date of this filing, we have sold $4.468 million of shares to investors other than our former parent company, reAlpha Tech Corp. (which as of the date of this Direct Listing no longer exists, as further described on “Business – Recent Developments” above), and $500,000 to our former parent company, for aggregate sales of $4.968 million. The holdings that belonged to our former parent company have been assigned to reAlpha Tech Corp. post the Downstream Merger (as defined above). For additional information on the India proceeding involving Mr. Devanur see “India Proceeding Involving Giri Devanur” section below.

On December 27, 2021, Ms. Valentina Isakina, a former board advisor of reAlpha Tech Corp., our former parent company, filed a lawsuit in the Southern District of Ohio against, reAlpha Tech Corp. in connection with her termination package. After three months of service, our then-parent company discontinued her services as she was not the right fit for the company’s needs. reAlpha Tech Corp. contends that pursuant to the terms of her employment agreement, she was offered 12,500 shares of reAlpha Tech Corp., which was supposed to vest over a period of time, however she never accepted the shares.

Ms. Isakina, however, contends she is owed up to 5% from reAlpha Tech Corp. for an alleged agreement to serve on the board of directors, which reAlpha Tech Corp. has denied of its existence. The parties are in the process of completing discovery. There is no trial set, and we believe the matter will be resolved in late 2023 or in 2024.

Mr. Devanur was previously the CEO of a company named Gandhi City Research Park, Pvt. Ltd (“Gandhi City Research Park”), which was financially impacted and liquidated as a result of the Lehman Brothers collapse. In 2010, an investor in Gandhi City Research Park filed a fraud complaint with the Cubbon Park Police in Bengaluru, India, against, among others, Mr. Devanur. In 2014, the Cubbon Park Police dismissed all claims and concluded that no case had been made out by the investor. In 2015, the investor appealed the Cubbon Park Police’s decision. As a result, a summons for a criminal proceeding was issued to, among others, Mr. Devanur in 2018. As of today, no charges have been brought against Mr. Devanur. Based on the Petition filed by Giri Devanur in 2019, the High Court of Karnataka has stayed the entire trial before the Magistrate Court.

The following table provides information regarding our executive officers, significant employees and directors as of April 17, 2023.

Giri Devanur is our Chief Executive Officer, President and Chairman of the board of directors. Mr. Devanur became a member of our board of directors in April 2021 and Chairman of the board of directors in April 2023. He is a serial business entrepreneur and an experienced chief executive officer who has been involved in capital planning and investor presentations as an executive officer for various issuers, all of which are now private. He has more than 25 years of experience in the information technology industry. Earlier, he served as the CEO of AMERI Holdings, Inc., a global SAP consulting company becoming its CEO and a member of its board of directors in May 2015. AMERI Holdings, Inc. was listed on Nasdaq during Mr. Devanur’s tenure as CEO in November 2017. Following Mr. Devanur’s departure from AMERI Holdings, Inc., the company went private in January 2020, and, therefore, is no longer listed on NASDAQ. Previously, he founded WinHire Inc., a company in India, 2010, an innovative company building software products through technology and human capital management experts and combining them with professional services. Mr. Devanur has a master’s degree in Technology Management from Columbia University and a bachelor’s degree in computer engineering from the University of Mysore, India. He has attended Executive Education programs at the Massachusetts Institute of Technology and Harvard Law School.

Michael J. Logozzo is the Chief Financial Officer of reAlpha Tech Corp., and he was our interim Chief Operating Officer from January 2022 until April 2023. Prior to his current role at the Company, Mr. Logozzo was Managing Director of the Americas Region for L Marks, covering the U.S., Canada, and Latin America from May 2019 to February 2021. He was also a strategic and transformation leader at BMW Financial Services from 2001 to 2019. During his 18-year tenure, Mr. Logozzo was responsible for finance operations, innovation, and best practices integration at the automotive company’s Americas Regional Services Center in Columbus, Ohio and the headquarters in Munich, Germany. Mr. Logozzo holds a Management Information Systems Bachelor of Science (B.S.) from Youngstown State University, and a Business Administration, Management and Operations Masters of Business Administration (MBA) from Franklin University.

Christie Currie is our Chief Marketing Officer of reAlpha Tech Corp. During her college career Christie launched her own business in the MedTech space, winning multiple venture pitch competitions. Ms. Currie worked at a London-based corporate innovation firm, L Marks from December 2019 to June 2021, where she led corporate organizations to identify strategic areas of need and successfully engage industry disrupting startups. Further, from December 2017 to April 2021, Ms. Currie was the Founder and Chief Executive Officer of Zandaland LLC. Ms. Currie is also a board member of Carthagos, Inc., a marketing studio that does the branding and marketing for the Company. Ms. Currie has an Entrepreneurship Studies and Marketing Bachelor of Arts (B.A.) from Miami University, and a Technology Management Masters from Columbia University.

Jorge Aldecoa is the Chief Operating Officer of the Company. Mr. Aldecoa brings over 12 years of experience in residential and commercial real estate and is an expert in acquisition, disposition, and asset management. Most recently he has served as Vice President of Operations for Transcendent Electra and Managing Broker of Transcendent Electra Realty & BUSB Realty from 2018 to 2022. He brings experience in successfully leading the creation and implementation of a property management platform to facilitate the acquisition and management of 2,200 newly constructed single-family rental homes. He also gained experience as Chief Investment Officer of Firm Capital American Realty Partners and Interim Chief Operating Officer for its predecessor from 2014 to 2017. Mr. Aldecoa holds a Residential Development and Property Management Bachelor’s degree of Science (B.S.) from Florida State University.

Brian Cole has been a member of our board of directors since April 2021. Mr. Cole has also acted as the managing member of Baird’s Technology and Services Investment Banking Group since March 2010. In that role, Mr. Cole leads merger and acquisition and capital raising transactions, advising premier tech-enabled outsourcing companies. Prior to joining Baird’s Technology Services Investment Banking Group, Mr. Cole was a manager in PricewaterhouseCoopers’ Transaction Services practice where he led mergers and acquisitions advisory and financial due diligence engagements for private equity and corporate clients including leveraged buyouts, mergers, carve-out divestitures, take-privates, and joint ventures. Brian received his M.B.A. from Indiana University’s Kelley School of Business and a Bachelor’s of Science (B.S.) in business from the same institution with honors.

Monaz Karkaria was our Chief Operating Officer from inception until her resignation from those roles in January 2022. In January 2022, she became a member of our board of directors. Ms. Karkaria has been investing in rental properties since 1999 and has been a part of over 100 real-estate transactions. Ms. Karkaria is the owner and founder of Ben Zen Investments LLC and Ben Zen Properties LLC since 2013. Ms. Karkaria was also a social director at ZANT a non-profit organization from 2015 to 2017. Further, Ms. Karkaria was a business consultant in Brazil from 2006 to 2008. Ms. Karkaria holds a Bachelor’s degree from the All India Institute of Physical Medicine and Rehabilitation. The board of directors believes that Ms. Karkaria’s substantial experience in the real estate industry will enable her to bring real estate business insights to the board of directors.

Dimitrios Angelis became a member of our board of directors in April 2023. Mr. Angelis is an accomplished business strategist who brings over two decades of experience as general counsel from several multinational companies. Since July 2016, he has been the managing member of Pharma Tech Law LLC, a law firm that specializes in the life sciences field. Further, since November 2018, he has acted as the President, co-founder and chairman of the board of directors of Sparta Biomedical Inc., a privately-held developer of orthopedic solutions. Mr. Angelis has also been a member of the board of directors of The One Group (NASDAQ: STKS) since March 2018. Mr. Angelis has a Bachelor of Arts (B.A.) in Philosophy and English from Boston College, a Master of Arts (M.A.) in Behavioral Science from California State University and a Juris Doctor (J.D.) from NYU School of Law. Our board of directors believes that Mr. Angelis’ substantial experience as an accomplished attorney, negotiator and general counsel to public and private companies in the healthcare field will enable him to bring a wealth of strategic, legal and business acumen to the board of directors.

Balaji Swaminathan became a member of our board of directors in April 2023. Mr. Swaminathan is an accomplished business leader with extensive experience in financial services and entrepreneurship. Since 2018, Mr. Swaminathan has been the founder, Chief Executive Officer and a member of the board of directors of SAIML Pte Ltd, a Singapore-based Capital Markets Services licensed company that provides personalized wealth management solutions for ultra-high net worth customers. Prior to his entrepreneurial pursuits, Mr. Swaminathan also held several key leadership roles in major financial institutions, including serving as President of Westpac International from 2012 to 2019. Mr. Swaminathan also holds multiple directorships with Singapore-based private companies in the finance industry, including S Cube Digilytics Venture Pte Ltd., Turbo Tech Ltd. and Allied Blenders and Distillers Liimited since 2022; AT Holdings Pte Ltd. Since 2019; and Vigbyor Realty & Investments Private Limited since 2018. Mr. Swaminathan has a Bachelor’s of Commerce (B.C.) in Finance from St. Xavier’s College, a Finance degree from The Institute of Chartered Accountants of India, a Finance Cost & Works degree from The Institute of Cost & Works Accountants of India and an Advanced Management Program from Harvard Business School. With his extensive experience and knowledge in the financial services industry, the board of directors believes that Mr. Swaminathan will be a valuable asset to our Company.

There are no family relationships among any of our executive officers or directors.

Upon the effectiveness of this registration statement, our board will consist of five members, each of whom serves as a director pursuant to the board composition provisions of our Certificate of Incorporation and Bylaws.

Mr. Giri Devanur, who owns 65.0% of the voting power of our outstanding common stock, will have the ability to control the outcome of matters submitted to our stockholders for approval, including the election of our directors, as well as the overall management and direction of our company. In the event of his death, the shares of our common stock that Mr. Devanur owns will be transferred to the persons or entities that he designates.

Because Mr. Devanur controls a majority of our outstanding voting power, we are a “controlled company” under the corporate governance rules for publicly-listed companies. For so long as we remain a controlled company, we are exempt from the obligation to comply with certain Nasdaq corporate governance requirements, including:

We intend to apply to list our common stock on the Nasdaq Capital Market. Subject to the controlled company exemption described above, the listing rules of Nasdaq generally require that a majority of the members of a listed company’s board of directors be independent. In addition, the listing rules generally require that, subject to specified exceptions, each member of a listed company’s audit, compensation, and governance committees be independent subject to the controlled company exemptions described above, as applicable to the compensation and governance committees.

Audit committee members must also satisfy the independence criteria set forth in Rule 10A-3 under the Securities Exchange Act of 1934, as amended (Exchange Act). In order to be considered independent for purposes of Rule 10A-3, a member of an audit committee of a listed company may not, other than in his or her capacity as a member of the audit committee, the board of directors, or any other board committee: accept, directly or indirectly, any consulting, advisory, or other compensatory fee from the listed company or any of its subsidiaries; or be an affiliated person of the listed company or any of its subsidiaries.

Our board of directors undertook a review of its composition, the composition of its committees and the independence of our directors and considered whether any director has a material relationship with us that could compromise his or her ability to exercise independent judgment in carrying out his or her responsibilities. Based upon information requested from and provided by each non-employee director concerning his or her background, employment and affiliations, including family relationships, our board of directors has determined that none of our directors have relationships that would interfere with the exercise of independent judgment in carrying out the responsibilities of a director and that each of these directors is “independent” as that term is defined under the rules of Nasdaq and Rule 10A-3 and Rule 10C-1 under the Exchange Act. Only Monaz Karkaria and Giri Devanur are not independent under Nasdaq’s independence standards.

Upon the effectiveness of this registration statement, our board of directors will establish an audit committee, a compensation committee, and a nominating and corporate governance committee, each of which will operate pursuant to a charter to be adopted by our board of directors and will be in place upon the effectiveness of this registration statement. Upon the effectiveness of this registration statement, the composition and functioning of all of our committees will comply with all applicable requirements of the Sarbanes-Oxley Act of 2002, Nasdaq, and SEC rules and regulations.

Upon the effectiveness of this registration statement, our board of directors will establish an audit committee of the board of directors. Under the national exchange listing standards and applicable SEC rules, we are required to have at least three members of the audit committee, all of whom must be independent, subject to certain phase-in provisions. Balaji Swaminathan, Brian Cole and Dimitrios Angelis meet the independent director standard under national exchange listing standards and under Rule 10-A-3(b)(1) of the Exchange Act. Balaji Swaminathan will serve as chairman of our audit committee. Each member of the audit committee is financially literate and our board of directors has determined that Balaji Swaminathan qualifies as an “audit committee financial expert” as defined in applicable SEC rules.

We will adopt an audit committee charter, which will detail the purpose and principal functions of the audit committee, including:

Upon the effectiveness of this registration statement, our board of directors will establish a compensation committee of the board of directors. Balaji Swaminathan, Brian Cole and Dimitrios Angelis will serve as members of our compensation committee. Under the national exchange listing standards and applicable SEC rules, we are required to have at least two members of the compensation committee, all of whom must be independent, subject to certain phase-in provisions. Each of Balaji Swaminathan, Brian Cole and Dimitrios Angelis meet the independent director standard under national exchange listing standards applicable to members of the compensation committee.

We will adopt a compensation committee charter, which will detail the purpose and responsibility of the compensation committee, including:

The charter will permit the committee to retain or receive advice from a compensation consultant and will outline certain requirements to ensure the consultants independence or certain circumstances under which the consultant need not be independent. We have not retained such a consultant.

Upon the effectiveness of this registration statement, our board of directors will establish a nominating and governance committee of the board of directors that will be comprised of independent directors. Balaji Swaminathan, Brian Cole and Dimitrios Angelis will serve as members of our nominating and governance. We will adopt a nominating and governance committee charter, which will detail the purpose and responsibilities of the nominating and governance committee, including:

Our audit committee will be responsible for overseeing our risk management process. Our audit committee will focus on our general risk management policies and strategy, the most significant risks facing us, and oversees the implementation of risk mitigation strategies by management. Our board of directors is also apprised of particular risk management matters in connection with its general oversight and approval of corporate matters and significant transactions.

Upon the effectiveness of this registration statement, our board of directors will adopt a Code of Business Conduct and Ethics, or the “Code of Conduct,” applicable to all directors, executive officers and employees. The Code of Conduct will be available on the Investor Relations portion of our website at www.realpha.com. The nominating and corporate governance committee of our board of directors will be responsible for overseeing the Code of Conduct and must approve any waivers of the Code of Conduct for employees, executive officers and directors. In addition, we intend to post on our website all disclosures that are required by law or Nasdaq’s listing standards concerning any amendments to, or waivers of, any provision of the Code of Conduct.

Our named executive officers for the years ended April 30, 2022 and 2021 were as follows:

Prior to the consummation of the Downstream Merger (as defined above), the compensation for each of our named executive officers was paid by our previous parent company, reAlpha Tech Corp. Since March 21, 2023, the compensation of our named executive officers has been paid by the Company (f.k.a. reAlpha Asset Management, Inc.). The following table contains information about the compensation paid to or earned by each of our named executive officers during the years ended April 30, 2022 and 2021.

The Company entered into an employment agreement with Giri Devanur on September 1, 2021. Pursuant to Mr. Devanur’s employment agreement, he will serve as the Company’s Chief Executive Officer until his agreement is terminated by either Mr. Devanur or the Company, and he received a yearly salary of $150,000, pro-rated for the fiscal year ended April 30, 2022, and an additional discretionary bonus of $50,000 per year, subject to the discretion of the board of directors.

By letter agreement, dated April 11, 2023, the Company entered into an updated employment agreement with Mr. Devanur, which provides for a base salary of $150,000, which may be adjusted to $250,000 upon a successful follow-on offering of the Company’s securities for an amount of $8 million or more, subject to the compensation committee’s approval. Further, Mr. Devanur is entitled to additional compensation in the form of a discretionary bonus of up to $75,000 based on the achievement of certain established performance targets, which is payable annually, and certain benefits such as unlimited vacation, health insurance and others. In addition, Mr. Devanur is eligible to participate in the Plan (as defined below). Mr. Devanur or the Company may terminate the employment agreement at any time upon written notice to the other party. Mr. Devanur’s employment agreement has a confidentiality provision and a non-compete for a period of two (2) years following the termination of his employment.

The Company entered into an employment agreement with Michael J. Logozzo on February 21, 2021. Pursuant to Mr. Logozzo’s employment agreement, he will serve as the Company’s Chief Financial Officer until his agreement is terminated by either Mr. Logozzo or the Company, and he received a yearly salary of $140,000 for the fiscal year ended April 30, 2022 and a pro-rated amount of such base salary for the year ended April 30, 2021.

By letter agreement, dated April 11, 2023, the Company entered into an updated employment agreement with Mr. Logozzo, which provides for a base salary of $140,000, which may be adjusted to $250,000 upon a successful follow-on offering of the Company’s securities for an amount of $8 million or more, subject to the compensation committee’s approval. Further, Mr. Logozzo is entitled to additional compensation in the form of a discretionary bonus of up to $75,000 based on the achievement of certain established performance targets, which is payable annually, and certain benefits such as unlimited vacation, health insurance and others. Further, Mr. Logozzo is eligible to participate in the Plan (as defined below). Mr. Logozzo or the Company may terminate the employment agreement at any time upon written notice to the other party. Mr. Logozzo’s employment agreement has a confidentiality provision and a non-compete for a period of two (2) years following the termination of his employment.

The Company entered into an employment agreement with Christine Currie on March 2, 2021 as Vice President of Innovation for the Company. Pursuant to Ms. Currie’s employment agreement, she served as the Vice President of Innovation until her agreement is terminated by either Ms. Currie or the Company, and she received a yearly salary of $80,000 for the fiscal year ended April 30, 2022 and a pro-rated amount of such base salary for the year ended April 30, 2021. Ms. Currie was promoted to Chief Marketing Officer in April 2021, and the board of directors approved an increase to her base annual salary from $80,000 to $100,000 on September 16, 2021, with no changes to her other benefits.

By letter agreement, dated April 11, 2023, the Company entered into an updated employment agreement with Ms. Currie for her to serve as the Company’s Chief Marketing Officer, which provides for a base salary of $100,000, which may be adjusted to $175,000 upon a successful follow-on offering of the Company’s securities for an amount of $8 million or more, subject to the compensation committee’s approval. Further, Ms. Currie is entitled to additional compensation in the form of a discretionary bonus of up to $25,000 based on the achievement of certain established performance targets, which is payable annually, and certain benefits such as unlimited vacation, health insurance and others. Ms. Currie or the Company may terminate the employment agreement at any time upon written notice to the other party. Further, Ms. Currie is eligible to participate in the Plan (as defined below). Ms. Currie’s employment agreement has a confidentiality provision and a non-compete for a period of two (2) years following the termination of his employment.

We maintain the reAlpha Tech Corp. 2022 Equity Incentive Plan (the “Plan”), under which we may grant awards to our employees, officers and directors and certain other service providers. Our board of directors administers the Plan. The board of directors is authorized to grant awards to eligible employees, consultants and other service providers. The aggregate number of shares of common stock that may be issued under the Plan may not exceed 4,000,000 shares of common stock. All of our current employees, consultants and other service providers are eligible to be granted awards under the Plan. Eligibility for awards under the Plan is determined by the board of directors at its discretion.

The Plan permits the discretionary award of incentive stock options (“ISOs”), non-statutory stock options (“NQSOs”), stock awards (which may have varying vesting schedules and be subject to lock-up periods at the board of directors’ discretion) and other equity awards to selected participants. Unless sooner terminated, no ISO may be granted under the Plan on or after the 10^th anniversary of the effective date of the Plan.

The plan administrator has the sole discretion in setting the vesting period and, if applicable, exercise schedule of an award, determining that an award may not vest for a specified period after it is granted and accelerating the vesting period of an award. The plan administrator determines the exercise or purchase price of each award, to the extent applicable. The Plan does not allow for the assignment, transfer or exercise of awards other than by will or the laws of descent and distribution.

Unless otherwise provided by the participant’s Option Award Agreement or Stock Award Agreement issued pursuant to the Plan, upon the participant’s termination for any reason, including but not limited to death, Disability (as defined in the Plan), voluntary termination nor involuntary termination with or without Cause (as defined in the Plan), all unvested equity awards in the form of options or shares shall be forfeited. Vested options, unless otherwise provided, will remain exercisable for three (3) months following termination of the participant if such termination is for any reason other than death, Disability or termination for Cause. In case the participant’s separation from service is due to death or Disability, then the vested options will be exercisable for a period of twelve (12) months thereafter. In case the participant’s termination is for Cause, the participant will immediately forfeit any and all options issued to such participant under the Plan.

The Plan also provides the Company with a right of repurchase all or portion of the shares awarded to the participant under the Plan, which may be exercised in case a participant separates from service for any reason, at a price equal to the fair market value, as determined by the board of directors. In the event of a Change in Control (as defined in the Plan), the board of directors will have the sole discretion to address the treatment of a participant’s unvested awards in connection with such Change in Control in the participant’s award agreement.

The board of directors may modify, amend or terminate the plan at any time, provided that no such modification, amendment or termination of the Plan materially affects the rights of a participant under a previously granted award without that participant’s consent. Further, the board of directors cannot, without the approval of the Company’s stockholders, amend this plan: (i) increase the number of common stock with respect to the ISOs that may be granted under the Plan; (ii) make any changes in the class of employees eligible to receive the ISOs under the plan; (iii) without stockholder approval if required by applicable law.

The following table presents the total compensation earned and paid to non-employee and employee member directors of our board of directors during the year ended April 30, 2022, which is payable quarterly. Our non-executive directors are entitled to an annual compensation of $25,000, payable in cash in quarterly installments of $6,250, plus reimbursements for reasonable travel expenses, and out-of-pocket costs incurred in attending meetings of our board of directors or events attended on behalf of the Company.

Mr. Giri Devanur, our Chief Executive Officer, President and member of the board of directors, received a total of $12,500 for his service as a member of our board of directors during the period presented below. Mr. Devanur’s total compensation for service as an employee and as a member of our board of directors is presented under the heading “Summary Compensation Table” above.

The following table sets forth information regarding the beneficial ownership of our common stock by (i) each stockholder known by us to be the beneficial owner of more than 5% of our outstanding shares of common stock , (ii) each of our directors, (iii) each of our named executive officers and (iv) all of our directors and executive officers as a group. Unless otherwise indicated, the address of each executive officer and director is c/o reAlpha Tech Corp. at 6515 Longshore Loop, Suite 100, Dublin, OH 43017. Applicable percentage ownership is based on 42,522,091 shares of common stock outstanding at April 17, 2023.

The number of shares of common stock beneficially owned by each stockholder is determined under rules issued by the SEC regarding the beneficial ownership of securities. This information is not necessarily indicative of beneficial ownership for any other purpose. Under these rules, beneficial ownership of shares of our common stock includes (1) any shares as to which the person or entity has sole or shared voting power or investment power and (2) any shares as to which the person or entity has the right to acquire beneficial ownership within 60 days after the date hereof. Each holder’s percentage ownership after this Direct Listing is based on shares of common stock to be outstanding immediately after the consummation of this Direct Listing.

Except as disclosed herein, no director, executive officer, stockholder holding at least 5% of shares of our common stock, or any family member thereof, had any material interest, direct or indirect, in any transaction, or proposed transaction since May 1, 2020, in which the amount involved in the transaction exceeds the lesser of $120,000 or one percent of the average of our total assets at the year-end for the last two completed fiscal years.

The Company, by means of a merger, owns (a) subsidiary named myAlphie LLC with all of its technology and intellectual property and (b) two on demand promissory notes of $975,000 and $4,875,000 payable to CH REAlpha Investments, LLC, and CH REAlpha Investments II, LLC, respectively. The promissory notes carry an Interest rate of Prime Rate plus one percent (1%).

The Company (f.k.a. reAlpha Asset Management Inc) had a Master Service Agreement with ReAlpha Tech Corp. (our previous parent company) for their patented technologies and platforms and agreed to pay ReAlpha Tech Corp. a management fee of 20% of rental income, however, this agreement is no longer effective post-Downstream Merger (as defined above).

Prior to this Direct Listing, we have not had a formal policy regarding approval of transactions with related persons. In connection with this Direct Listing, our board of directors has adopted a related-person transaction policy that sets forth our procedures for the identification, review, consideration and approval or ratification for the review of any transaction, arrangement or relationship in which we are a participant, the amount involved exceeds $120,000 and one of our executive officers, directors, director nominees or each person whom we know to beneficially own more than 5% of our outstanding shares of common stock (a “5% stockholder”) (or their immediate family members), each of whom we refer to as a “related person,” has a direct or indirect material interest.

If a related person proposes to enter into such a transaction, arrangement or relationship, which we refer to as a “related-person transaction,” the related person must report the proposed related-person transaction to the Company’s general counsel. The policy calls for the proposed related-person transaction to be reviewed by and if deemed appropriate approved by, the audit committee of our board of directors after full disclosure of the related-person interest in the transaction. Whenever practicable, the reporting, review and approval will occur prior to entry into the transaction. If advance review and approval is not practicable, the audit committee will review and, in its discretion, may ratify the related-person transaction. The policy also permits the chair of the audit committee to review, and if deemed appropriate approve, proposed related-person transactions that arise between audit committee meetings, subject to ratification by the audit committee at its next meeting. Any related-person transactions that are ongoing in nature will be reviewed annually.

A related-person transaction reviewed under the policy will be considered approved or ratified if it is authorized by the audit committee after full disclosure of the related person’s interest in the transaction. As appropriate for the circumstances, the committee will review and consider:

The audit committee may approve or ratify the transaction only if the audit committee determines that, under all of the circumstances, the transaction is not inconsistent with our best interests. The audit committee may impose any conditions on the related-person transaction that it deems appropriate.

The policy provides that transactions involving compensation of executive officers shall be reviewed and approved by the compensation committee of our board of directors in the manner specified in its charter.

The following table sets forth the number of shares of our common stock held by the Registered Stockholders and registered as common stock for resale by means of this prospectus.

This prospectus registers for resale shares of our common stock that are held by certain Registered Stockholders that include our officers, directors, affiliates and certain other stockholders with “restricted” securities under the applicable securities laws and regulations who, because of their status as affiliates of us pursuant to Rule 144 or because they acquired their capital stock from an affiliate or from us within the prior 12 months from the date of any proposed sale, would otherwise be unable to sell their securities pursuant to Rule 144 until we have been subject to the reporting requirements of Section 13 or Section 15(d) of the Exchange Act for a period of at least 90 days. See “Shares Eligible for Future Sale” for further information regarding sales of such “restricted” securities if not sold pursuant to this prospectus.

Information concerning the Registered Stockholders may change from time to time and any changed information will be set forth in supplements to this prospectus, if and when necessary. Because the Registered Stockholders may sell all, some, or none of the shares of our common stock covered by this prospectus, we cannot determine the number of such shares of our common stock that will be sold by the Registered Stockholders, or the amount or percentage of shares of our common stock that will be held by the Registered Stockholders upon consummation of any particular sale. In addition, the Registered Stockholders listed in the table below may have sold, transferred or otherwise disposed of, or may sell, transfer or otherwise dispose of, at any time and from time to time, our shares of common stock in transactions exempt from the registration requirements of the Securities Act, after the date on which they provided the information set forth in the table below. See “Management” and “Certain Relationships and Related Party Transactions” for further information regarding the Registered Stockholders.

We currently intend to use our reasonable efforts to keep the registration statement of which this prospectus forms a part effective for a period of 90 days after the effectiveness of the registration statement. We are not party to any arrangement with any Registered Stockholder or any broker-dealer with respect to sales of shares of our common stock by the Registered Stockholders (see “Plan of Distribution” section below).

We have determined beneficial ownership in accordance with the rules of the SEC, and thus it represents sole or shared voting or investment power with respect to our securities. Unless otherwise indicated below, to our knowledge, the persons and entities named in the table have sole voting and sole investment power with respect to all shares that they beneficially owned, subject to community property laws where applicable. The information does not necessarily indicate beneficial ownership for any other purpose, including for purposes of Sections 13(d) and 13(g) of the Exchange Act.

We have based percentage ownership of our common stock based on 42,522,091 shares of our common stock issued and outstanding as of April 17, 2023. These amounts are based upon information available to the Company as of the date of this filing.

The following description summarizes important terms of the classes of our capital stock based on our Certificate of Incorporation and Bylaws that will be in effect immediately prior to the effectiveness of this registration statement. This summary does not purport to be complete and is qualified in its entirety by the provisions of our Certificate of Incorporation and our Bylaws, which have been filed as exhibits to the registration statement of which this prospectus is a part.

Our authorized capital stock currently consists of 200,000,000 shares of common stock, par value $0.001 per share, and 5,000,000 shares of “blank check” preferred stock, par value $0.001 per share.

As of the date hereof, there were 42,522,091 issued and outstanding shares of our common stock held by 3,123 stockholders of record. No shares of preferred stock are currently issued or outstanding.

Voting Rights. The holders of shares of our common stock are entitled to one vote for each share held of record on all matters submitted to a vote of stockholders. Any action at a meeting at which a quorum is present will be decided by a majority of the votes cast by the stockholders present in person or represented by proxy at the meeting and entitled to vote thereon, except in the case of any election of directors, which will be decided by a plurality of votes cast. There is no cumulative voting.

Dividends. The Company has never declared or paid cash dividends on any of its capital stock and currently does not anticipate paying any cash dividends after the Direct Listing or in the foreseeable future. The holders of our common stock are entitled to receive dividends as may be declared from time to time by our board of directors out of legally available funds. Any dividend declared by the board of directors must be equal, on a per share basis.

Liquidation Rights. In the event of a voluntary or involuntary liquidation, dissolution, or winding up of the Company, the holders of common stock are entitled to share ratably in the net assets legally available for distribution to stockholders after the payment of debts and other liabilities of the Company.

Our board of directors has the authority to issue undesignated shares of “blank check” preferred stock in one or more series and to fix the designation, relative powers, preferences and rights and qualifications, limitations or restrictions of all shares of each such series, including, without limitation, dividend rates, conversion rights, voting rights, redemption and sinking fund provisions, liquidation preferences and the number of shares constituting each such series, without any further vote or action by the stockholders. The issuance of additional preferred stock could decrease the amount of earnings and assets available for distribution to holders of our common stock or adversely affect the rights and powers, including voting rights, of the holders of our common stock and could, among other things, have the effect of delaying, deferring or preventing a change in control of our company without further action by the stockholders. We have no present plans to issue any shares of preferred stock.

Anti-Takeover Effects of the Certificate of Incorporation and Bylaws and Certain Provisions of Delaware Law

Our Certificate of Incorporation and the DGCL contain provisions that are summarized in the following paragraphs and that are intended to enhance the likelihood of continuity and stability in the composition of our board of directors. These provisions are intended to avoid costly takeover battles, reduce our vulnerability to a hostile or abusive change of control and enhance the ability of our board of directors to maximize stockholder value in connection with any unsolicited offer to acquire us. However, these provisions may have an anti-takeover effect and may delay, deter or prevent a merger or acquisition of the Company by means of a tender offer, a proxy contest or other takeover attempt that a stockholder might consider in its best interest, including those attempts that might result in a premium over the prevailing market price for the Shares of common stock held by stockholders.

Delaware law does not require stockholder approval for any issuance of shares that are authorized and available for issuance. However, the listing requirements of Nasdaq, which would apply so long as the shares of common stock remain listed on Nasdaq, require stockholder approval of certain issuances equal to or exceeding 20% of the then outstanding voting power or the then outstanding number of shares of common stock. These additional shares may be used for a variety of corporate purposes, including future public offerings, to raise additional capital or to facilitate acquisitions. Additionally, the number of authorized shares of any series of common stock or preferred stock may be increased or decreased (but not below the number of shares thereof outstanding) by the affirmative vote of the holders of a majority in voting power, irrespective of the provisions of Section 242(b)(2) of the DGCL.

The Certificate of Incorporation provides that, subject to the rights granted to one or more series of preferred stock then outstanding, any newly-created directorship on the board of directors that results from an increase in the number of directors and any vacancies on our board of directors will be filled solely only by the affirmative vote of a majority of the remaining directors, even if less than a quorum, by a sole remaining director or by the stockholders.

The Certificate of Incorporation provides that special meetings of our stockholders may be called at any time only by the board of directors, the chairman of the board of directors or our Chief Executive Officer acting pursuant to a resolution approved by the affirmative vote of a majority of the directors then in office, subject to the rights of holders of any series of preferred stock then outstanding

Pursuant to Section 228 of the DGCL, any action required to be taken at any annual or special meeting of the stockholders may be taken without a meeting, without prior notice, and without a vote if a consent or consents in writing, setting forth the action so taken, is or are signed by the holders of outstanding stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares of our stock entitled to vote thereon were present and voted, the Certificate of Incorporation provides otherwise. In accordance with Section 228, our Bylaws allows for action by written consent.

We have opted out of Section 203 of the DGCL under our Certificate of Incorporation. As a result, pursuant to our Certificate of Incorporation, we are prohibited from engaging in any business combination with any stockholder for a period of three years following the time that such stockholder (the “interested stockholder”) came to own at least 15% of our outstanding voting stock (the “acquisition”), except if:

The restrictions described above will apply subject to certain exceptions, including if a stockholder becomes an interested stockholder inadvertently and, as soon as practicable, divests itself of ownership of such shares so that the stockholder ceases to be an interest stockholder, and, within the three (3) year period, that stockholder has not become an interested stockholder but for such inadvertent acquisition of ownership. Generally, a “business combination” or “acquisition” includes any merger, consolidation, asset or stock sale or certain other transactions resulting in a financial benefit to the interested stockholder. Subject to certain exceptions, an “interested stockholder” is a person who, together with that person’s affiliates and associates, owns, or within the previous three years owned, 15% or more of our outstanding voting stock.

Our Certificate of Incorporation provisions that elect to opt out of Section 203 of the DGCL may make it more difficult for a person who would be an “interested stockholder” to effect various business combinations with us for a three-year period. This may encourage companies interested in acquiring us to negotiate in advance with our board of directors because the stockholder approval requirement would be avoided if our board of directors approves the acquisition which results in the stockholder becoming an interested stockholder. This may also have the effect of preventing changes in our board of directors and may make it more difficult to accomplish transactions which stockholders may otherwise deem to be in their best interests.

Under the DGCL, with certain exceptions, our stockholders will have appraisal rights in connection with a merger or consolidation in which we are a constituent entity. Pursuant to the DGCL, stockholders who properly demand and perfect appraisal rights in connection with such merger or consolidation will have the right to receive payment of the fair value of their shares as determined by the Court of Chancery of the State of Delaware, plus interest, if any, on the amount determined to be the fair value, from the effective time of the merger or consolidation through the date of payment of the judgment.

Under the DGCL, any of our stockholders may bring an action in our name to procure a judgment in our favor, also known as a derivative action, provided that the stockholder bringing the action is a holder of our shares at the time of the transaction to which the action relates or such stockholder’s stock thereafter devolved by operation of law. To bring such an action, the stockholder must otherwise comply with Delaware law regarding derivative actions.

Our Certificate of Incorporation provides that, unless we consent in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware will be the sole and exclusive forum for (i) any derivative action or proceeding brought on our behalf, (ii) any action asserting a claim of breach of fiduciary duty owed by any director, officer or other employee to us or to our stockholders, (iii) any action asserting a claim against us, our directors, officers or employees arising pursuant to any provision of the DGCL or our Certificate of Incorporation or Bylaws or (iv) any action asserting a claim against use, our directors, officers or employees governed by the internal affairs doctrine.

Under our Charter, this exclusive form provision will not apply to claims which are vested in the exclusive jurisdiction of a court or forum other than the Court of Chancery of the State of Delaware, for which the Court of Chancery of the State of Delaware does not have subject matter jurisdiction, or for which the Court of Chancery determines there is an indispensable party not subject to its jurisdiction. For instance, the provision would not apply to actions arising under federal securities laws, including suits brought to enforce any liability or duty created by the Securities Act, the Exchange Act, or the rules and regulations thereunder.

The DGCL authorizes corporations to limit or eliminate the personal liability of directors to corporations and their stockholders for monetary damages for breaches of directors’ fiduciary duties, subject to certain exceptions. The Certificate of Incorporation includes a provision that eliminates the personal liability of directors for monetary damages to the corporation or its stockholders for any breach of fiduciary duty as a director, except to the extent such exemption from liability or limitation thereof is not permitted under the DGCL. The effect of these provisions is to eliminate the rights of us and our stockholders, through stockholders’ derivative suits on our behalf, to recover monetary damages from a director for breach of fiduciary duty as a director, including breaches resulting from grossly negligent behavior. However, exculpation does not apply to any director if the director has breached such director’s duty of loyalty, acted in bad faith, knowingly or intentionally violated the law, authorized illegal dividends, redemptions or repurchases or derived an improper benefit from his or her actions as a director.

The limitation of liability provision in our Certificate of Incorporation may discourage stockholders from bringing a lawsuit against directors for breach of their fiduciary duty. These provisions also may have the effect of reducing the likelihood of derivative litigation against directors and officers, even though such an action, if successful, might otherwise benefit us and our stockholders. In addition, your investment may be adversely affected to the extent we pay the costs of settlement and damage awards against directors and officers pursuant to these indemnification provisions.

There is currently no pending material litigation or proceeding involving any of our directors, officers or employees for which indemnification is sought.

We intend to apply to list our common stock on Nasdaq under the symbol “[●].”

Prior to the proposed listing of our common stock on the Nasdaq, there has been no public market for our common stock, and we cannot predict the effect, if any, that sales of shares of our common stock or the availability of shares of our common stock for sale will have on the market price of our common stock prevailing from time to time. Future sales of our common stock in the public market, or the availability of such shares for sale in the public market, could adversely affect market prices prevailing from time to time. Sales of substantial amounts of our common stock in the public market following our listing on the Nasdaq, or the perception that such sales could occur, could adversely affect the public price of our common stock and may make it more difficult for you to sell your common stock at a time and price that you deem appropriate. We will have no input if and when any Registered Stockholder may, or may not, elect to sell its shares of common stock or the prices at which any such sales may occur. Future sales of our common stock in the public market, or the availability of such shares for sale in the public market, could adversely affect the trading prices of shares of our common stock prevailing from time to time.

Before our Direct Listing, there has not been a public market for shares of our common stock. Future sales of substantial amounts of shares of our common stock in the public market after our Direct Listing, or the possibility of these sales occurring, could cause the prevailing market price for our common stock to fall or impair our ability to raise equity capital in the future.

After our Direct Listing, we will have outstanding 42,522,091 shares of our common stock, based on the number of shares outstanding as of April 17, 2023. This includes 41,462,025 shares that the Registered Stockholders may resell in the public market immediately following our Direct Listing.

Shares of our common stock will be deemed “restricted securities” (as defined in Rule 144 under the Securities Act). Restricted securities may be sold in the public market only if they are registered or if they qualify for an exemption from registration under Rule 144 or Rule 701 under the Securities Act, which rules are summarized below. Following the listing of our common stock on Nasdaq, shares of our common stock may be sold either by the Registered Stockholders pursuant to this prospectus or by our other existing stockholders in accordance with Rule 144 of the Securities Act.

The 855,537 shares of common stock that were issued pursuant to our Regulation A offering will be freely tradable without restrictions or further registration under the Securities Act of 1933 in the public market immediately following our Direct Listing.

The 204,529 shares of our common stock issued to Maxim Partners LLC are subject to a lock-up restriction until the earlier of (i) one (1) year from the date of their initial engagement, or (ii) six (6) months after the date in which the Company gets listed on Nasdaq.

Further, certain Registered Stockholders listed above beneficially own in the aggregate 6,469,011 shares of our common stock, or 15.21%, all of such shares were granted pursuant to our Plan, and which shares may be subject to a lock-up restrictions under our Plan’s restricted stock award agreement (the “Lock-Up”). The Lock-Up will become applicable to the extent that there is an initial underwritten public offering of the Company’s securities. The Lock-Up, if and when applicable, will expire one hundred and eighty (180) days after the effectiveness of a registration statement of the Company’s initial underwritten public offering of the Company’s securities. The shares may be resold for so long as the registration statement, of which this prospectus forms a part, is available for use and any applicable restrictions are expired or waived. The sale of all securities being offered in this prospectus could result in a significant decline in the public trading price of our common stock upon effectiveness of an underwritten public offering of the Company’s securities.

In general, under Rule 144 as currently in effect, once we have been subject to the public company reporting requirements of Section 13 or Section 15(d) of the Exchange Act for at least 90 days, a person who is not deemed to have been one of our affiliates for purposes of the Securities Act at any time during the 90 days preceding a sale and who has beneficially owned the shares proposed to be sold for at least six months, including the holding period of any prior owner other than our affiliates, is entitled to sell those shares without complying with the manner of sale, volume limitation, or notice provisions of Rule 144, subject to compliance with the public information requirements of Rule 144. If such a person has beneficially owned the shares proposed to be sold for at least one year, including the holding period of any prior owner other than our affiliates, then that person would be entitled to sell those shares without complying with any of the requirements of Rule 144.

In general, under Rule 144, as currently in effect, our affiliates or persons selling shares on behalf of our affiliates are entitled to sell, within any three-month period, a number of shares of common stock that does not exceed the greater of:

Sales under Rule 144 by our affiliates or persons selling shares of our common stock on behalf of our affiliates are also subject to certain manner-of-sale provisions and notice requirements and to the availability of current public information about us.

In general, under Rule 701, any of our employees, directors, officers, consultants, or advisors who purchase shares of capital stock from us in connection with a compensatory stock option plan or other written agreement before the effective date of the registration statement of which this prospectus forms a part is entitled to sell such shares 90 days after such effective date in reliance on Rule 144.

We intend to file one or more registration statements on Form S-8 under the Securities Act to register shares of our common stock subject to any outstanding equity awards, as well as shares of our common stock reserved for future issuance under our Plan (as defined above). We expect to file these registration statements as soon as permitted under the Securities Act. However, the shares registered on Form S-8 may be subject to the volume limitations and the manner of sale, notice, and public information requirements of Rule 144. See “Executive Compensation — Equity Incentive Plan” for a description of our Plan.

The following discussion is a general summary of the material U.S. federal income tax consequences to U.S. Holders and Non-U.S. Holders (as defined below) generally applicable to the ownership and disposition of our common stock by a U.S. Holder or Non-U.S. Holder that acquires our common stock and holds our common stock as a capital asset within the meaning of Section 1221 of the U.S. Internal Revenue Code of 1986, as amended (the “Code”) (generally, property held for investment), but does not purport to be a complete analysis of all potential tax effects. The effects of other U.S. federal tax laws, such as estate and gift tax laws, and any applicable state, local, or non-U.S. tax laws are not discussed. This discussion is based on the Code, Treasury Regulations promulgated thereunder, judicial decisions, and published rulings and administrative pronouncements of the IRS, in each case in effect as of the date hereof. These authorities may change or be subject to differing interpretations. Any such change or differing interpretation may be applied retroactively in a manner that could adversely affect a U.S. Holder or Non-U.S. Holder. We have not sought and will not seek any rulings from the IRS regarding the matters discussed below. There can be no assurance that the IRS or a court will not take a contrary position to that discussed below regarding the tax consequences of the ownership and disposition of our common stock.

This discussion does not address all U.S. federal income tax consequences relevant to a U.S. Holder’s or Non-U.S. Holder’s particular circumstances, including the impact of the Medicare contribution tax on net investment income and the alternative minimum tax or subject to special rules, including, without limitation:

If an entity treated as a partnership for U.S. federal income tax purposes holds our common stock, the tax treatment of a partner in the partnership will depend on the status of the partner, the activities of the partnership, and certain determinations made at the partner level. Accordingly, partnerships holding our common stock and the partners in such partnerships should consult their tax advisors regarding the U.S. federal income tax consequences to them.

THIS DISCUSSION IS FOR INFORMATIONAL PURPOSES ONLY AND IS NOT TAX ADVICE. INVESTORS SHOULD CONSULT THEIR TAX ADVISORS WITH RESPECT TO THE APPLICATION OF THE U.S. FEDERAL INCOME TAX LAWS TO THEIR PARTICULAR SITUATIONS AS WELL AS ANY TAX CONSEQUENCES OF THE OWNERSHIP AND DISPOSITION OF OUR COMMON STOCK ARISING UNDER THE U.S. FEDERAL ESTATE OR GIFT TAX LAWS OR UNDER THE LAWS OF ANY STATE, LOCAL, OR NON-U.S. TAXING JURISDICTION OR UNDER ANY APPLICABLE INCOME TAX TREATY.

For purposes of this discussion, a “U.S. Holder” means a beneficial owner of our common stock (other than an entity or arrangement that is treated as a partnership for U.S. federal income tax purposes) that is, for U.S. federal income tax purposes, any of the following:

For purposes of this discussion, a “Non-U.S. Holder” is any beneficial owner of our common stock that is neither a “U.S. Holder” nor an entity treated as a partnership for U.S. federal income tax purposes.

If we pay distributions in cash or other property (other than certain distributions of our stock or rights to acquire our stock) to U.S. Holders of shares of our common stock, such distributions generally will constitute dividends for U.S. federal income tax purposes to the extent paid from our current or accumulated earnings and profits, as determined under U.S. federal income tax principles. Distributions in excess of current and accumulated earnings and profits will constitute a return of capital that will be applied against and reduce (but not below zero) the U.S. Holder’s adjusted tax basis in our common stock. Any remaining excess will be treated as gain realized on the sale or other disposition of the common stock and will be treated as described under “U.S. Holders - Gain or Loss on Sale, Taxable Exchange or Other Taxable Disposition of Common Stock” below.

Dividends we pay to a U.S. Holder that is a taxable corporation generally will qualify for the dividends received deduction if the requisite holding period is satisfied. With certain exceptions (including, but not limited to, dividends treated as investment income for purposes of investment interest deduction limitations), and provided certain holding period requirements are met, dividends we pay to a non-corporate U.S. Holder may constitute “qualified dividends” that will be subject to tax at the maximum tax rate accorded to long-term capital gains.

Gain or Loss on Sale, Taxable Exchange or Other Taxable Disposition of Common Stock

Upon a sale or other taxable disposition of our common stock, a U.S. Holder generally will recognize capital gain or loss in an amount equal to the difference between the amount realized and the U.S. Holder’s adjusted tax basis in the common stock. Any such capital gain or loss generally will be long-term capital gain or loss if the U.S. Holder’s holding period for the common stock so disposed of exceeds one year. Long-term capital gains recognized by non-corporate U.S. Holders will be eligible to be taxed at reduced rates. The deductibility of capital losses is subject to limitations.

Generally, the amount of gain or loss recognized by a U.S. Holder is an amount equal to the difference between (i) the sum of the amount of cash and the fair market value of any property received in such disposition and (ii) the U.S. Holder’s adjusted tax basis in its common stock so disposed of. A U.S. Holder’s adjusted tax basis in its common stock generally will equal the U.S. Holder’s acquisition cost less any prior distributions treated as a return of capital.

In general, information reporting requirements may apply to dividends paid to a U.S. Holder and to the proceeds of the sale or other disposition of our shares of common stock, unless the U.S. Holder is an exempt recipient. Backup withholding may apply to such payments if the U.S. Holder fails to provide a taxpayer identification number, a certification of exempt status or has been notified by the IRS that it is subject to backup withholding (and such notification has not been withdrawn).

Backup withholding is not an additional tax. Any amounts withheld under the backup withholding rules will be allowed as a refund or a credit against a U.S. Holder’s U.S. federal income tax liability provided the required information is timely furnished to the IRS. All U.S. Holders should consult their tax advisors regarding the application of information reporting and backup withholding to them.

As described in the section titled “Dividend Policy,” we do not currently anticipate paying dividends on our common stock. However, if we do make distributions of cash or property on our common stock, such distributions will constitute dividends for U.S. federal income tax purposes to the extent paid from our current or accumulated earnings and profits, as determined under U.S. federal income tax principles. Amounts not treated as dividends for U.S. federal income tax purposes will constitute a return of capital and first be applied against and reduce a Non-U.S. Holder’s adjusted tax basis in its common stock, but not below zero. Any excess will be treated as capital gain and will be treated as described under the subsection titled “—Sale or Other Taxable Disposition” below. Because we may not know the extent to which a distribution is a dividend for U.S. federal income tax purposes at the time it is made, for purposes of the withholding rules discussed below we or the applicable withholding agent may treat the entire distribution as a dividend. Any such distributions will also be subject to the discussions below under the heading “Additional Withholding Tax on Payments Made to Foreign Accounts.”

Subject to the discussion below regarding effectively connected income, dividends paid to a Non-U.S. Holder will be subject to U.S. federal withholding tax at a rate of 30% of the gross amount of the dividends (or such lower rate specified by an applicable income tax treaty, provided the Non-U.S. Holder furnishes a valid IRS Form W-8BEN or W-8BEN-E (or other applicable documentation) certifying qualification for the lower treaty rate). A Non-U.S. Holder that does not timely furnish the required documentation, but that qualifies for a reduced treaty rate, may obtain a refund of any excess amounts withheld by timely filing an appropriate claim for refund with the IRS. Non-U.S. Holders should consult their tax advisors regarding their entitlement to benefits under any applicable tax treaties.

If dividends paid to a Non-U.S. Holder are effectively connected with the Non-U.S. Holder’s conduct of a trade or business within the United States (and, if required by an applicable income tax treaty, the Non-U.S. Holder maintains a permanent establishment in the United States to which such dividends are attributable), the Non-U.S. Holder will generally be exempt from the U.S. federal withholding tax described above. To claim the exemption, the Non-U.S. Holder must furnish to the applicable withholding agent a valid IRS Form W-8ECI, certifying that the dividends are effectively connected with the Non-U.S. Holder’s conduct of a trade or business within the United States.

Any such effectively connected dividends will be subject to U.S. federal income tax on a net income basis at the regular rates. A Non-U.S. Holder that is a corporation also may be subject to a branch profits tax at a rate of 30% (or such lower rate specified by an applicable income tax treaty) on such effectively connected dividends, as adjusted for certain items. Non-U.S. Holders should consult their tax advisors regarding any applicable tax treaties that may provide for different rules.

A Non-U.S. Holder will not be subject to U.S. federal income tax on any gain realized upon the sale or other taxable disposition of our common stock unless:

Gain described in the first bullet point above generally will be subject to U.S. federal income tax on a net income basis at the regular rates applicable to U.S. persons. A Non-U.S. Holder that is a corporation also may be subject to a branch profits tax at a rate of 30% (or such lower rate specified by an applicable income tax treaty) on such effectively connected gain, as adjusted for certain items.

A Non-U.S. Holder described in the second bullet point above will be subject to U.S. federal income tax at a rate of 30% (or such lower rate specified by an applicable income tax treaty) on gain realized upon the sale or other taxable disposition of our common stock, which may be offset by certain U.S. source capital losses of the Non-U.S. Holder (even though the individual is not considered a resident of the United States), provided the Non-U.S. Holder has timely filed U.S. federal income tax returns with respect to such losses.

With respect to the third bullet point above, we believe we may meet the definition of a USRPHC. Because the determination of whether we are a USRPHC depends, however, on the fair market value of our USRPIs relative to the fair market value of our non-U.S. real property interests and our other business assets, the analysis is constantly evolving. Even if we are a USRPHC, gain arising from the sale or other taxable disposition of our common stock by a Non-U.S. Holder will not be subject to U.S. federal income tax unless such Non-U.S. Holder owns, actually and constructively, greater than 5% of our common stock throughout the shorter of the five-year period ending on the date of the sale or other taxable disposition or the Non-U.S. Holder’s holding period.

Non-U.S. Holders should consult their tax advisors regarding any applicable tax treaties that may provide for different rules.

Withholding taxes may be imposed under Sections 1471 to 1474 of the Code (such Sections commonly referred to as the Foreign Account Tax Compliance Act (FATCA)) on certain types of payments made to non-U.S. financial institutions and certain other non-U.S. entities. Specifically, a 30% withholding tax may be imposed on dividends on, or (subject to the proposed Treasury Regulations discussed below) gross proceeds from the sale or other disposition of, our common stock paid to a “foreign financial institution” or a “non-financial foreign entity” (each as defined in the Code), unless (i) the foreign financial institution undertakes certain diligence and reporting obligations, (ii) the non-financial foreign entity either certifies it does not have any “substantial United States owners” (as defined in the Code) or furnishes identifying information regarding each substantial United States owner, or (iii) the foreign financial institution or non-financial foreign entity otherwise qualifies for an exemption from these rules. If the payee is a foreign financial institution and is subject to the diligence and reporting requirements in (i) above, it must enter into an agreement with the U.S. Department of the Treasury requiring, among other things, that it undertake to identify accounts held by certain “specified United States persons” or “United States owned foreign entities” (each as defined in the Code), annually report certain information about such accounts, and withhold 30% on certain payments to non-compliant foreign financial institutions and certain other account holders. Foreign financial institutions located in jurisdictions that have an intergovernmental agreement with the United States governing FATCA may be subject to different rules.

Under applicable Treasury Regulations and administrative guidance, withholding under FATCA generally applies to payments of dividends on our common stock. While withholding under FATCA would have applied also to payments of gross proceeds from the sale or other disposition of our common stock beginning on January 1, 2020, proposed Treasury Regulations eliminate FATCA withholding on payments of gross proceeds entirely. Taxpayers generally may rely on these proposed Treasury Regulations until final Treasury Regulations are issued.

Prospective investors should consult their tax advisors regarding the potential application of withholding under FATCA to their investment in our common stock.

We must report annually to the IRS and to each Non-U.S. Holder the amount of any distributions paid to, and the tax withheld with respect to, each Non-U.S. Holder. These reporting requirements apply regardless of whether withholding was reduced or eliminated by an applicable income tax treaty. Copies of this information reporting may also be made available under the provisions of a specific income tax treaty or agreement with the tax authorities in the country in which the Non-U.S. Holder resides or is established.

A Non-U.S. Holder will generally be subject to backup withholding for dividends on our common stock paid to such holder unless such holder certifies under penalties of perjury that, among other things, it is a Non-U.S. Holder (provided that the payor does not have actual knowledge or reason to know that such holder is a U.S. person) by furnishing a valid IRS Form W-8BEN, W-8BEN-E, or W-8ECI, or otherwise establishes an exemption.

Information reporting and backup withholding generally will apply to the proceeds of a disposition of our common stock by a Non-U.S. Holder effected by or through the U.S. office of any broker, U.S. or non-U.S., unless the holder certifies its status as a Non-U.S. Holder and satisfies certain other requirements, or otherwise establishes an exemption. Generally, information reporting and backup withholding will not apply to a payment of disposition proceeds to a Non-U.S. Holder where the transaction is effected outside the United States through a non-U.S. office of a broker. However, for information reporting purposes, dispositions effected through a non-U.S. office of a broker with substantial U.S. ownership or operations generally will be treated in a manner similar to dispositions effected through a U.S. office of a broker. Non-U.S. Holders should consult their tax advisors regarding the application of the information reporting and backup withholding rules to them.

Backup withholding is not an additional income tax. Any amounts withheld under the backup withholding rules from a payment to a Non-U.S. Holder generally can be credited against the Non-U.S. Holder’s U.S. federal income tax liability, if any, or refunded, provided that the required information is furnished to the IRS in a timely manner. Non-U.S. Holders should consult their tax advisors regarding the application of the information reporting and backup withholding rules to them.

The Registered Stockholders, and their pledgees, donees, transferees, assignees, or other successors in interest may sell their shares of common stock covered hereby pursuant to brokerage transactions on Nasdaq, or other public exchanges or registered alternative trading venues, at prevailing market prices at any time after the shares of common stock are listed for trading. We are not party to any arrangement with any Registered Stockholder or any broker-dealer with respect to sales of shares of common stock by the Registered Stockholders. As such, we do not anticipate receiving notice as to if and when any Registered Stockholder may, or may not, elect to sell their shares of common stock or the prices at which any such sales may occur, and there can be no assurance that any Registered Stockholders will sell any or all of the shares of common stock covered by this prospectus.

We will not receive any proceeds from the sale of shares of common stock by the Registered Stockholders. We will recognize costs related to this Direct Listing and our transition to a publicly-traded company consisting of professional fees and other expenses. We will expense these amounts in the period incurred and not deduct these costs from net proceeds to the issuer as they would be in an initial public offering. We will also bear all costs, expenses and fees in connection with the registration of these securities, including with regard to compliance with state securities or “blue sky” laws. The Registered Stockholders will bear all commissions and discounts, if any, attributable to their sale of shares of common stock.

The shares of common stock beneficially owned by the Registered Stockholders covered by this prospectus may be offered and sold from time to time by the Registered Stockholders. The term “Registered Stockholders” includes donees, pledgees, transferees or other successors in interest selling securities received after the date of this prospectus from a selling stockholder as a gift, pledge, partnership distribution or other transfer. The Registered Stockholders will act independently of us in making decisions with respect to the timing, manner and size of each sale. Such sales may be made on one or more exchanges or in the over-the-counter market or otherwise, at prices and under terms then prevailing or at prices related to the then current market price or in negotiated transactions. The Registered Stockholders may sell their shares of common stock by one or more of, or a combination of, the following methods:

In addition, any securities that qualify for sale pursuant to Rule 144 may be sold under Rule 144 rather than pursuant to this prospectus.

To the extent required, this prospectus may be amended or supplemented from time to time to describe a specific plan of distribution. In connection with distributions of the common stock or otherwise, the Registered Stockholders may enter into hedging transactions with broker-dealers or other financial institutions. In connection with such transactions, broker-dealers or other financial institutions may engage in short sales of common stock in the course of hedging the positions they assume with Registered Stockholders. The Registered Stockholders may also sell shares of common stock short and redeliver the shares to close out such short positions. The Registered Stockholders may also enter into option or other transactions with broker-dealers or other financial institutions which require the delivery to such broker-dealer or other financial institution of securities offered by this prospectus, which securities such broker-dealer or other financial institution may resell pursuant to this prospectus (as supplemented or amended to reflect such transaction). The Registered Stockholders may also pledge shares of common stock to a broker-dealer or other financial institution, and, upon a default, such broker-dealer or other financial institution may effect sales of the pledged securities pursuant to this prospectus (as supplemented or amended to reflect such transaction).

In effecting sales, broker-dealers or agents engaged by the Registered Stockholders may arrange for other broker-dealers to participate. Broker-dealers or agents may receive commissions, discounts or concessions from the Registered Stockholders in amounts to be negotiated immediately prior to the sale. In offering the securities covered by this prospectus, the Registered Stockholders and any broker-dealers who execute sales for the Registered Stockholders may be deemed to be “underwriters” within the meaning of the Securities Act in connection with such sales. Any profits realized by the Registered Stockholders and the compensation of any broker-dealer may be deemed to be underwriting discounts and commissions.

In order to comply with the securities laws of certain states, if applicable, the securities must be sold in such jurisdictions only through registered or licensed brokers or dealers. In addition, in certain states the securities may not be sold unless they have been registered or qualified for sale in the applicable state or an exemption from the registration or qualification requirement is available and is complied with.

We have advised the Registered Stockholders that the anti-manipulation rules of Regulation M under the Exchange Act may apply to sales of securities in the market and to the activities of the Registered Stockholders and their affiliates. In addition, we will make copies of this prospectus available to the Registered Stockholders for the purpose of satisfying the prospectus delivery requirements of the Securities Act. The Registered Stockholders may indemnify any broker-dealer that participates in transactions involving the sale of the securities against certain liabilities, including liabilities arising under the Securities Act.

At the time a particular offer of securities is made, if required, a prospectus supplement will be distributed that will set forth the number of securities being offered and the terms of the offering, including the name of any underwriter, dealer or agent, the purchase price paid by any underwriter, any discount, commission and other item constituting compensation, any discount, commission or concession allowed or reallowed or paid to any dealer, and the proposed selling price to the public.

The validity of the shares of common stock offered hereby will be passed upon for us by Mitchell Silberberg & Knupp LLP. As of the date of this prospectus, Mitchell Silberberg & Knupp LLP beneficially owns an aggregate of 100,000 shares of our common stock.

The consolidated financial statements of reAlpha Tech Corp. and subsidiaries as of April 30, 2022, and April 30, 2021, have been included herein and in the registration statement of which this prospectus forms a part in reliance upon the report of GBQ Partners, LLC, an independent registered public accounting firm, appearing elsewhere herein, and upon the authority of said firm as experts in accounting and auditing.

As of the date of the Direct Listing, Mitchell Silberberg & Knupp LLP, our legal counsel, beneficially owns 100,000 shares of our common stock, which equity securities were received as partial consideration for legal services provided to us in connection with the Direct Listing.

We have filed with the SEC this Registration Statement on Form S-1 under the Securities Act, with respect to the shares of our common stock covered by this prospectus. This prospectus, which constitutes a part of the registration statement, does not contain all of the information set forth in the registration statement or the exhibits and schedules to the registration statement. Please refer to the registration statement and exhibits for further information with respect to the common stock covered by this prospectus. Statements contained in this prospectus regarding the contents of any contract or other document are only summaries. With respect to any contract or document that is filed as an exhibit to the registration statement, you should refer to the exhibit for a copy of the contract or document, and each statement in this prospectus regarding that contract or document is qualified by reference to the exhibit. The SEC maintains a website that contains reports, proxy and information statements, and other information regarding companies, like us, that file documents electronically with the SEC. The address of that website is www.sec.gov.

Immediately upon the effectiveness of this registration statement of which this prospectus forms a part, we will become subject to the information and reporting requirements of the Exchange Act, and, in accordance with this law, will be required to file periodic reports, proxy statements, and other information with the SEC. These periodic reports, proxy statements, and other information will be available at the website of the SEC referred to above. We also maintain a website at www.podcastone.com, at which you may access these materials free of charge as soon as reasonably practicable after they are electronically filed with, or furnished to, the SEC. The information contained on, or that can be accessed through, these websites is not a part of this prospectus. We have included these website addresses in this prospectus solely as inactive textual references.

We have audited the accompanying balance sheets of reAlpha Tech Corp. and Subsidiaries (f.k.a. ReAlpha Asset Management, Inc.) and Subsidiaries (the “Company”) as of April 30, 2022 and 2021, the related statements of operations, stockholders’ deficit, and cash flows for the years then ended, and related notes (collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company at April 30, 2022 and 2021, and the results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America.

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 2 to the consolidated financial statements, the Company has experienced recurring losses from operations and negative cash flows from operations that raise substantial doubt about its ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 2. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

The accompanying notes are an integral part of these consolidated financial statements.

For the Year Ended April 30, 2022 and for the Period from April 22, 2021 (inception) to April 30, 2021 (audited)

The accompanying notes are an integral part of these consolidated financial statements.

For the Year Ended April 30, 2022 and for the Period from April 22, 2021 (inception) to April 30, 2021 (audited)

The accompanying notes are an integral part of these consolidated financial statements.

For the Year Ended April 30, 2022 and for the Period from April 22, 2021 (inception) to April 30, 2021 (audited)

The accompanying notes are an integral part of these consolidated financial statements.

reAlpha Tech Corp. (f.k.a. ReAlpha Asset Management, Inc.) (RTC) (f.k.a. ReAlpha Asset Management, Inc.) and Subsidiaries, incorporated in Delaware on April 22, 2021, together with its subsidiaries described below are collectively referred to as “the Company”. The Company is primarily engaged in the business of the identification, acquisition, financing, marketing and management of short-term rental properties for the benefit of the Company’s members and stockholders. For details about the merger between reAlpha Tech Corp. and reAlpha Asset Management, Inc., please refer to “Note 10 – Subsequent Events” below.

The Company’s consolidated financial statements have been prepared assuming the Company will continue as a going concern. The Company commenced operations as of April 22, 2021, and has not yet realized its planned operations. The Company is dependent upon additional capital resources for full commencement of its planned operations and is subject to significant risks and uncertainties, including failing to secure funding to commence the Company’s planned operations or failing to profitably operate the business.

Management believes that the Company will continue to incur losses for the foreseeable future and will need equity or debt financing or will need to generate additional revenues from the property rental activity to sustain its operations until it can achieve profitability and positive cash flows. The Company intends to raise funds through various potential sources, such as equity or debt financings; however, the Company can provide no assurance that such financing will be available on acceptable terms, or at all. If adequate financing is not available, the Company may be required to significantly curtail or cease its operations, and its business would be jeopardized.

Management has determined that these matters, among others, raise substantial doubt about the Company’s ability to continue as a going concern for a period of at least one year from the date these consolidated financial statements are issued. The accompanying consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.

The Company prepares its consolidated financial statements under the accrual basis of accounting, in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and Article 8 of Regulation S-X of the rules and regulations of the SEC.

The Company consolidates entities when the Company owns, directly or indirectly, a majority interest in the entity or are otherwise able to control the entity. The Company consolidates variable interest entities (“VIEs”) in accordance with Accounting Standards Codification (“ASC”) 810, Consolidation, if the Company is the primary beneficiary of the VIE as determined by the power to direct the VIE’s activities and the obligation to absorb its losses or the right to receive its benefits, which are potentially significant to the VIE. A VIE is broadly defined as an entity with one or more of the following characteristics: (a) the total equity investment at risk is insufficient to finance the entity’s activities without additional subordinated financial support; (b) as a group, the holders of the equity investment at risk lack (i) the ability to make decisions about the entity’s activities through voting or similar rights, (ii) the obligation to absorb the expected losses of the entity, or (iii) the right to receive the expected residual returns of the entity; or (c) the equity investors have voting rights that are not proportional to their economic interests, and substantially all of the entity’s activities either involve, or are conducted on behalf of, an investor that has disproportionately few voting rights.

The Company considers all the balances in its bank accounts as cash equivalents & the Holdbacks due to be receivable by the company are considered as Restricted Cash.

As of April 30, 2022 and 2021, the Company’s accounts receivable include Reg-A proceeds, & Short Term Rental Revenues due from Property management companies. Management has evaluated the receivables and believes they are collectable based on the nature of the receivables, historical experience of credit losses, and all other currently available evidence. As of April 30, 2022 and 2021 the Company has no allowance for doubtful accounts or uncollectible accounts.

The Company complies with the requirements of FASB ASC 340-10-S99-1 with regards to offering costs. Prior to the completion of an offering, offering costs are capitalized and recognized as a reduction to the settling subscriptions liability in the consolidated balance sheets. The deferred offering costs are charged to member’s equity upon the completion of an offering or to expense if the offering is not completed.

The Financial Accounting Standards Board (“FASB”) issued the Accounting Standards Codification (“ASC”) 820, Fair Value Measurement and Disclosures, requires all entities to disclose the fair value of financial instruments, both assets and liabilities for which it is practicable to estimate fair value, and defines fair value of a financial instrument as the amount at which the instrument could be exchanged in a current transaction between willing parties. As of April 30, 2022 and 2021 the recorded values of receivables, accounts payable and other liabilities approximated their fair value due to the short-term nature of the instruments.

The Company maintains its cash with major financial institutions located in the United States of America, which it believes to be creditworthy. The Federal Deposit Insurance Corporation insures balances up to $250,000. At times, the Company may maintain balances in excess of the federally insured limits.

The Company expenses advertising costs as and when they are incurred. Advertising expenses totaled $1,939,607 for the year ended April 30, 2022 and there was no advertising expense for the year ended April 30, 2021.

The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Noncontrolling interests represents minority owners’ share of net income or losses and equity in the Company’s majority-owned consolidated subsidiaries.

The Company has a limited operating history. The Company’s business and operations are sensitive to general business and economic conditions in the United States. A host of factors beyond the Company’s control could cause fluctuations in these conditions. Adverse conditions may include recession, downturn or otherwise, local competition or changes in consumer taste. These adverse conditions could affect the Company’s financial condition and the results of its operations

Real estate assets are carried at cost. Depreciation is calculated on the straight-line method over the estimated lives of the assets (27.5 years for residential rental property and 5 years for furniture and fixtures). Major additions and betterments are capitalized and depreciated. Maintenance and repairs, which do not improve or extend the estimated useful lives, are expensed as incurred. Upon disposal of assets, the related cost and accumulated depreciation are removed from the accounts, and any gain or loss resulting from the disposal is recorded in the period of disposition in the accompanying consolidated statement of operations.

The Company applies FASB ASC 360-10, “Property, Plant & Equipment,” to measure impairment in real estate investments. Rental properties are individually evaluated for impairment when conditions exist which may indicate that it is probable that the sum of expected future cash flows (on an undiscounted basis without interest) from a rental property is less than the carrying value under its historical net cost basis. These expected future cash flows consider factors such as future operating income, trends and prospects as well as the effects of leasing demand, competition and other factors. Upon determination that a permanent impairment has occurred, rental properties are reduced to their fair value. For properties to be disposed of, an impairment loss is recognized when the fair value of the property, less the estimated cost to sell, is less than the carrying amount of the property measured at the time there is a commitment to sell the property and/or it is actively being marketed for sale. A property to be disposed of is reported at the lower of its carrying amount or its estimated fair value, less its cost to sell. Subsequent to the date that a property is held for disposition, depreciation expense is not recorded. There were no such impairment adjustments during the periods ended April 30, 2022 and 2021.

Revenues primarily consist of short-term rental revenues. Additionally, the Company records up to 25% of the gross revenues from the short-term rental properties towards the management of the properties acquired. The Company has the following revenue sources and revenue recognition policies:

Short-term rental revenues include revenues from the rental of properties via Airbnb, Vacasa and such digital hospitality platforms.

For every property, which generates revenue through short-term rental ReAlpha charges up to 20% of the gross revenue towards the up-keep, maintenance, upgrade, and related operating cost.

At this time, the Company is not collecting an asset management fee related to its management of properties. In the future, that is an area that we anticipate being an area of Revenue Recognition. No timeline, however, has yet been set for that change.

Revenues are recognized in accordance with Topic 606 of the Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) for revenue recognition. The Company recognizes revenues in a manner to depict the transfer of goods or services to a customer at an amount that reflects the consideration expected to be received in exchange for those goods or services. The Company considers revenue realized or realizable and earned when all the five following criteria are met: (1) identification of the contract with a customer, (2) identification of the performance obligations in the contract, (3) determination of the transaction price, (4) allocation of the transaction price to the performance obligations in the contract, and (5) recognition of revenue when (or as) performance obligations are satisfied.

Deferred financing costs represent loan fees, legal fees and other third-party costs associated with obtaining financing and are presented on the balance sheet as a direct deduction from the carrying value of the associated debt. These costs are amortized to interest expense over the terms of the respective financing agreements using the interest method. Unamortized deferred financing costs are generally expensed when the associated debt is refinanced or repaid before maturity unless specific rules are met that would allow for the carryover of such costs. Costs incurred in seeking financing transactions that do not close are expensed in the period in which it is determined that the financing will not close. As of April 30, 2022, deferred financing costs and accumulated amortization of deferred financing costs were $114,172 and $62,123 , respectively ($26,373 and $5,520, respectively as of April 30, 2021). Amortization expense of deferred financing costs was $61,092 and $668 in 2022 and 2021, respectively.

The Company accounts for income taxes under the asset and liability method, which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements. Under this method, the Company determines deferred tax assets and liabilities on the basis of the differences between the financial statement and tax bases of assets and liabilities by using enacted tax rates in effect for the year in which the differences are expected to reverse. The effect of a change in tax rates on deferred tax assets and liabilities is recognized in income in the period that includes the enactment date. The Company recognizes deferred tax assets to the extent that these assets are more likely than not to be realized. In making such a determination, the Company considers all available positive and negative evidence, including future reversals of existing taxable temporary differences, projected future taxable income, tax-planning strategies, and results of recent operations.

If it is determined that the Company would be able to realize the deferred tax assets in the future in excess of their net recorded amount, an adjustment would be made to the deferred tax asset valuation allowance, which would reduce the provision for income taxes. The Company records uncertain tax positions in accordance with ASC 740 on the basis of a two-step process in which (1) it is determined whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, the Company recognizes the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority. The Company recognizes and interest and penalties, if any, with income tax expense in the accompanying consolidated statement of operations.

For the purpose of reporting cash flows, cash and restricted cash includes cash on hand and cash on deposit with financial institutions.

Investment in real estate – properties other than held for sale consisted of the following as of April 30, 2021:

Depreciation expense was $85,203 for the year ended April 30, 2022 and $164 for the period from April 22, 2021 (inception) to April 30, 2021.

All investments in real estate as of April 30, 2022 and 2021 were pledged as collateral for the Company’s secured long-term debt.

As of April 30, 2022, the Company maintains its cash in three separate accounts with two financial institutions, and cash balances may, at times, exceed federally insured limits.

During the closing on an investment in rental real estate property or real estate held for improvement transaction, the Company may place a cash deposit on the property being acquired or fund amounts into escrow. These deposits are placed before the closing process of the property is complete.

The Company has issued promissory notes payable to lenders related to the acquisition of properties. These promissory notes range from 8.49% to 12.0%, with 6 months to 1 year, as detailed below.

The Company is authorized to issue up to 50,000,000 shares of Common Stock, par value $0.001 per share. As of April 30, 2022, there were 40,010,000 shares of Common Stock issued and outstanding and as of April 30, 2021 there were no common stocks issued.

ReAlpha Tech Corp. (f.k.a. reAlpha Asset Management, Inc.) had a Master Service Agreement with ReAlpha Tech Corp. for their patented technologies and platforms and will pay ReAlpha Tech Corp. a management fee of 20% of rental income, however, this agreement is no longer effective post-merger.

ReAlpha Tech Corp. (f.k.a. reAlpha Asset Management, Inc.) had a Payable to ReAlpha Tech Corp. totaling $ 1,712,426 as of April 30, 2022 and Receivable from ReAlpha Tech Corp $ 4,718 as of April 30, 2021. The receivable & payable do not accrue interest.

The Company may be subject to pending legal proceedings and regulatory actions in the ordinary course of business. The results of such proceedings cannot be predicted with certainty, but the Company does not anticipate that the final outcome, if any, arising out of any such matter will have a material adverse effect on its business, financial condition or results of operations.

The Company entered into the Consent Order with the Securities Division of the Office of the Secretary of the Commonwealth of Massachusetts (the “MSD”) following an investigation by the MSD into whether the Company had engaged in acts or practices that violated the Massachusetts Uniform Securities Act (the “Massachusetts Act”) and the regulations promulgated thereunder (the “Massachusetts Regulations”). For purposes of settlement, the Company did not admit or deny the findings of fact or law or allegations contained in the Consent Order. Under the terms of the Consent Order, the Company is censured, barred from offering or selling securities in Massachusetts, and ordered to cease and desist from committing future violations of the Massachusetts Act and the Massachusetts Regulations. Pursuant to the Consent Order, the Company paid a $375,000 administrative fine on April 21, 2022 and offered to rescind the purchases of each of the 14 Massachusetts investors who purchased the Company’s common stock in its Regulation A offering. The $375,000 fine is included in general and administrative expenses in the 2022 consolidated statements of operations. Those Massachusetts investors paid an aggregate amount of $19,500 to purchase their shares. Seven of the fourteen Massachusetts investors elected to accept the offer of rescission and the Company has fully refunded a total of $11,500 to such investors. The Company has fully complied with the terms of the Consent Order.

Management has evaluated subsequent events through the date of the Independent Auditor’s Report, the date on which the financial statements were available to be issued.

Subsequent to the date of financial statements, the Company sold four properties for a total sale consideration of $1,164,900 and had gains on sale of $179,653. In connection with these property sales, the Company paid off the related notes payable totaling $565,737.

reAlpha Acquisitions Churchill, LLC, a wholly owned subsidiary of reAlpha Asset Management Inc., closed a credit facility worth up to $200 million on August 18th, 2022. This credit facility allows a loan-to-cost ratio of up to 80% and is at a fixed rate of 12%. Access to this credit facility will allow the Company to acquire properties with the intention of utilizing them as short-term rental properties.

The Reg A+ offering was qualified by the SEC in September 2021 and requalified on August 3, 2022. Reg A+ allows sales up to $75 million exempt from state Blue Sky registration requirements. Challenges with late Blue Sky notice filings led to a pause in the Reg A+ campaign in May, followed by an SEC amendment disclosure and requalification. The campaign concluded on January 19, 2023.

In March 2023, the Company opened its first Regulation CF offering listed under reAlpha 612 Jasmine Lane Inc. where the subsidiary is completing its first syndication through an initial public offering platform. The minimum offering amount is $388,639 and the maximum is $614,036, inclusive of investor payment processing fees. The offering is selling shares of the company which owns the property at 612 Jasmine Lane, Davenport, FL 33897. The minimum investment is $500 plus the 2.5% investor transaction fee.

On March 21, 2023, reAlpha Tech Corp merged with reAlpha Asset Management, Inc. in a short-form merger, resulting in reAlpha Asset Management, Inc. becoming the surviving corporation and gaining access to reAlpha Tech Corp.’s technology and intellectual property. Prior to the merger, the Parent owned over 90% of the Subsidiary’s shares. The merger enables reAlpha Asset Management, Inc. to provide customers with a broader range of AI solutions for various industries and use cases. Following the merger, reAlpha Asset Management, Inc. changed its name to reAlpha Tech Corp. on March 21, 2023,

On March 24, 2023, reAlpha Tech Corp. acquired Roost Enterprises, Inc. (Rhove), a real estate technology solutions provider. The acquisition includes Rhove’s Syndication Platform and related intellectual property. The purchase price involved a $25,000 cash payment, 49,029 common stock shares to SVBB, 1,263,000 shares for sellers, and options for sellers to purchase 1,263,000 shares at $10 per share. Additionally, $50,000 was paid for Rhove’s transaction expenses. Drive Capital and its funds became investors of reAlpha, and Rhove’s CEO, Calvin Cooper, joined reAlpha in an advisory role.

The accompanying notes are an integral part of these consolidated financial statements.

Condensed Consolidated Statements of Operations
For the Three and Nine Months Ended January 31, 2023 and 2022 (unaudited)

The accompanying notes are an integral part of these consolidated financial statements.

Condensed Consolidated Statements of Changes in Stockholder’s Equity (Deficit)
For the Nine Months Ended January 31, 2023 and 2022 (unaudited)

The accompanying notes are an integral part of these consolidated financial statements.

ReAlpha Tech Corp. (f.k.a. ReAlpha Asset Management, Inc.) and Subsidiaries (RTC), incorporated in Delaware on April 22, 2021, together with its subsidiaries described below are collectively referred to as “the Company”. The Company is primarily engaged in the business of the identification, acquisition, financing, marketing, and management of short-term rental properties for the benefit of the Company’s members and stockholders. For details about the merger between reAlpha Tech Corp. and reAlpha Asset Management, Inc., please refer to “Note 10 – Subsequent Events” below. As of January 31, 2023, the Company has the following subsidiaries:

The Company’s consolidated financial statements have been prepared assuming the Company will continue as a going concern. The Company commenced operations on April 22, 2021, and has not yet realized its planned operations. The Company is dependent upon additional capital resources for the full commencement of its planned operations and is subject to significant risks and uncertainties, including failing to secure funding to commence the Company’s planned operations or failing to profitably operate the business.

The accompanying unaudited financial statements have been prepared in accordance with U.S. generally accepted accounting principles for interim financial information. Accordingly, they do not include all of the information and footnotes required by U.S. generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments considered necessary for fair presentation of the results of operations for the periods presented have been included. The financial statements should be read in conjunction with the audited financial statements and the notes thereto for the year ended April 30, 2022. Interim results are not necessarily indicative of results for the full year.

The Company consolidates entities when the Company owns, directly or indirectly, a majority interest in the entity or are otherwise able to control the entity. The Company consolidates variable interest entities (“VIEs”) in accordance with Accounting Standards Codification (“ASC”) 810, Consolidation if the Company is the primary beneficiary of the VIE as determined by the power to direct the VIE’s activities and the obligation to absorb its losses or the right to receive its benefits, which are potentially significant to the VIE. A VIE is broadly defined as an entity with one or more of the following characteristics: (a) the total equity investment at risk is insufficient to finance the entity’s activities without additional subordinated financial support; (b) as a group, the holders of the equity investment at risk lack (i) the ability to make decisions about the entity’s activities through voting or similar rights, (ii) the obligation to absorb the expected losses of the entity, or (iii) the right to receive the expected residual returns of the entity; or (c) the equity investors have voting rights that are not proportional to their economic interests, and substantially all of the entity’s activities either involve or are conducted on behalf of, an investor that has disproportionately few voting rights.

Settling subscriptions presented on the consolidated balance sheet represent equity subscriptions for which funds have been received but the common stock has not yet been issued. Under the terms of the Offering Circular for our common stock, subscriptions will be accepted or rejected by us. Once a subscription agreement is accepted, settlement of the shares will occur. We rely on our capital raising platform provider to notify us that funds have been settled for this purpose, which may differ from the time that cash is posted to our bank statement.

The Company applies FASB ASC 360-10, “Property, Plant & Equipment,” to measure impairment in real estate investments. Rental properties are individually evaluated for impairment when conditions exist which may indicate that it is probable that the sum of expected future cash flows (on an undiscounted basis without interest) from a rental property is less than the carrying value under its historical net cost basis. These expected future cash flows consider factors such as future operating income, trends, and prospects as well as the effects of leasing demand, competition, and other factors. Upon determination that a permanent impairment has occurred, rental properties are reduced to their fair value. For properties to be disposed of, an impairment loss is recognized when the fair value of the property, less the estimated cost to sell, is less than the carrying amount of the property measured at the time there is a commitment to sell the property and/or it is actively being marketed for sale. A property to be disposed of is reported at the lower of its carrying amount or its estimated fair value, less its cost to sell. Subsequent to the date that a property is held for disposition, depreciation expense is not recorded. There were no such impairment adjustments during the period ending January 31, 2023.

Revenues are recognized in accordance with the Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) Topic 606 for revenue recognition. The Company recognizes revenues in a manner to depict the transfer of goods or services to a customer at an amount that reflects the consideration expected to be received in exchange for those goods or services. The Company considers revenue realized or realizable and earned when all the five following criteria are met: (1) identification of the contract with a customer, (2) identification of the performance obligations in the contract, (3) determination of the transaction price, (4) allocation of the transaction price to the performance obligations in the contract and (5) recognition of revenue when (or as) performance obligations are satisfied.

Revenues primarily consist of short-term rental revenues, fees, and other income and gains generated by the sale of properties. The Company has the following revenue sources and revenue recognition policies:

Deferred financing costs represent loan fees, legal fees, and other third-party costs associated with obtaining financing and are presented on the balance sheet as a direct deduction from the carrying value of the associated debt. These costs are amortized to interest expense over the terms of the respective financing agreements using the interest method. Unamortized deferred financing costs are generally expensed when the associated debt is refinanced or repaid before maturity unless specific rules are met that would allow for the carryover of such costs. Costs incurred in seeking financing transactions that do not close are expensed in the period in which it is determined that the financing will not close.

If it is determined that the Company would be able to realize the deferred tax assets in the future in excess of their net recorded amount, an adjustment would be made to the deferred tax asset valuation allowance, which would reduce the provision for income taxes. The Company records uncertain tax positions in accordance with ASC 740 on the basis of a two-step process in which (1) it is determined whether it is more likely than not that the tax positions will be sustained on the basis of the technical merits of the position and (2) for those tax positions that meet the more-likely-than-not recognition threshold, the Company recognizes the largest amount of tax benefit that is more than 50 percent likely to be realized upon ultimate settlement with the related tax authority. The Company recognizes interest and penalties, if any, with income tax expense in the accompanying consolidated statement of operations.

For the purpose of reporting cash flows, cash and restricted cash include cash on hand and cash on deposit with financial institutions.

As of January 31, 2023, the Company maintains its cash in four separate accounts with three financial institutions, and cash balances may, at times, exceed federally insured limits.

The Company has issued promissory notes payable to lenders related to the acquisition of properties. These promissory notes range from 8.25% to 14.0%, and are due within 1 year, as detailed below.

Long-term debt consisted of the following as of January 31, 2023 and April 30, 2022:

The Company is authorized to issue up to 50,000,000 shares of Common Stock, par value $0.001 per share. As of January 31, 2023, there were 40,852,050 shares of Common Stock issued for a total consideration of $8,923,841 comprising Common Stock and Additional paid-in capital of $40,852 and $8,882,989 respectively. As of January 31, 2022 there were 40,010,000 shares of Common Stock issued for a total consideration of $ 550,000 comprising Common Stock and Additional paid-in capital of $40,010 and $509,990 respectively.

ReAlpha AMI has a Master Service Agreement with ReAlpha Tech Corp. for their patented technologies and platforms and will pay ReAlpha Tech Corp. a management fee of 20% of rental income.

ReAlpha AMI has a Payable to ReAlpha Tech Corp. totaling $ 314,096 as of January 31, 2023 and $ 1,712,426 as of April 30 2022. The receivable & payable do not accrue interest.

On May 2, 2022, the Company received a subpoena and request for deposition from the Ohio Division of Securities, relating to the Company’s communication with investors in the state of Ohio. The Ohio Division of Securities has not asserted any written allegations. The Company is fully cooperating with the Ohio Division of Securities. The Company cannot predict the eventual scope, duration, or outcome at this time. Accordingly, the Company is unable to estimate the reasonably possible loss or range of reasonably possible loss arising from these investigations.

Management has evaluated subsequent events through the date on which the financial statements were available to be issued.

In March 2023, the Company opened its first Regulation CF offering listed under reAlpha 612 Jasmine Lane Inc. where the subsidiary iscompleting its first syndication through our initial public offering platform. The minimum offering amount is $388,639 and the maximum is $614,036, inclusive of investor payment processing fees. The offering is selling shares of the company which owns the property at 612 Jasmine Lane, Davenport, FL 33897. The minimum investment is $500 plus the 2.5% investor transaction fee.

On March 21, 2023, reAlpha Tech Corp merged with reAlpha Asset Management, Inc. in a short-form merger, resulting in reAlpha Asset Management, Inc. becoming the surviving corporation and gaining access to reAlpha Tech Corp.'s technology and intellectual property. Prior to the merger, the Parent owned over 90% of the Subsidiary's shares. The merger enables reAlpha Asset Management, Inc. to provide customers with a broader range of AI solutions for various industries and use cases. Following the merger, reAlpha Asset Management, Inc. changed its name to reAlpha Tech Corp. on March 21, 2023,

On March 24, 2023, reAlpha Tech Corp. acquired Roost Enterprises, Inc. (Rhove), a real estate technology solutions provider. The acquisition includes Rhove's Syndication Platform and related intellectual property. The purchase price involved a $25,000 cash payment, 49,029 common stock shares to SVBB, 1,263,000 shares for sellers, and options for sellers to purchase 1,263,000 shares at $10 per share. Additionally, $50,000 was paid for Rhove's transaction expenses. Drive Capital and its funds became investors of reAlpha, and Rhove's CEO, Calvin Cooper, joined reAlpha in an advisory role.

Through and including , 2023 (the 25^th day after the date of this Direct Listing), all dealers effecting transactions in these securities, whether or not participating in this Direct Listing, may be required to deliver a prospectus. This is in addition to a dealer’s obligation to deliver a prospectus when acting as an underwriter and with respect to an unsold allotment or subscription.

The following table sets forth the costs and expenses, other than the underwriting discounts and commissions, payable in connection with the sale of the securities being registered. All amounts shown are estimates, except the Securities and Exchange Commission registration fee, the Financial Industry Regulatory Authority filing fee and the Exchange listing fee.

As permitted by Section 102 of the Delaware General Corporation Law (the “DGCL”), the Second Amended and Restated Certificate of Incorporation (the “Certificate of Incorporation”) and Second Amended and Restated Bylaws (the “Bylaws”) that will be in effect immediately prior to the effectiveness of this registration statement contain provisions that limit or eliminate the personal liability of our officers and directors for a breach of their fiduciary duty as a director and/or officer, as applicable. For example, the fiduciary duty of care generally requires that, when acting on behalf of the corporation, directors exercise an informed business judgment based on all material information reasonably available to them. Consequently, a director will not be personally liable to us or our stockholders for monetary damages for breach of fiduciary duty as a director, except to the extent such exemption from liability or limitation thereof is not permitted under the DGCL.

These limitations of liability do not affect the availability of equitable remedies such as injunctive relief or rescission. Our Certificate of Incorporation will also authorize us to indemnify our officers, directors, and other agents to the fullest extent permitted under Delaware law.

Our Certificate of Incorporation and our Bylaws will provide for the indemnification provisions described above and elsewhere herein. We will enter into, and intend to continue to enter into, separate indemnification agreements with our directors and officers that may be broader than the specific indemnification provisions contained in the DGCL. These indemnification agreements generally require us, among other things, to indemnify our officers and directors against certain liabilities that may arise by reason of their status or service as directors or officers, other than liabilities arising from willful misconduct. These indemnification agreements also generally require us to advance any expenses incurred by the directors or officers as a result of any proceeding against them as to which they could be indemnified. These indemnification provisions and the indemnification agreements may be sufficiently broad to permit indemnification of our officers and directors for liabilities, including reimbursement of expenses incurred, arising under the Securities Act of 1933, as amended (the “Securities Act”).

We have purchased and currently intend to maintain insurance on behalf of each and every person who is or was a director or officer of the company against any loss arising from any claim asserted against him or her and incurred by him or her in any such capacity, subject to certain exclusions.

Since April 22, 2021, we have made the following sales of unregistered securities:

On April 22, 2021, reAlpha Asset Management, Inc. (our previous name) issued 40,000,000 shares of common stock to reAlpha Tech Corp. (our previous parent company) valued at $0.01125 per share.

On March 21, 2023, in connection with our Downstream Merger (as defined above), each share of common stock of reAlpha Asset Management, Inc. held by reAlpha Tech Corp. (our previous parent) was automatically cancelled and all of the shares of common stock owned by reAlpha Tech Corp. (our previous parent) were converted into shares of the Company (f.k.a. reAlpha Asset Management, Inc.) post-merger. In accordance with the foregoing, the surviving corporation of the Downstream Merger (reAlpha Tech Corp.) issued 40,050,000 shares of common stock, which consisted of the previously issued 40,000,000 shares of common stock to our previous parent company, and 50,000 shares issued to reAlpha Tech Corp. prior to the Downstream Merger pursuant to their participation in our Regulation A offering.

On March 24, 2023, in connection with the Roost Enterprises, Inc. (“Rhove”) acquisition, we issued 49,029 shares of common stock to Silicon Valley Bridge Bank, N.A. (“SVBB”), 1,263,000 shares of common stock to the investor sellers of Rhove and the issuance of option letters to purchase in aggregate (pro-rated per investor seller) 1,263,000 shares of our common stock for $10 per share, with an expiration date of two (2) years from the date of issuance.

On April 14, 2023, 100,000 shares of common stock were issued to Mitchell Silberberg & Knupp LLP as partial consideration for legal services provided to us in connection with the Direct Listing.

On April 14, 2023, 204,529 shares of common stock were issued to Maxim Partners LLC as partial consideration for their engagement to provide general financial advisory and investment banking services to the Company.

From April 22, 2021, through January 31, 2023, we issued 855,537 shares of common stock at a per share price of $10, for total cash proceeds of $8,555,370, pursuant to our Regulation A offering. This offering has concluded on January 31, 2023. These shares of common stock were issued in reliance on the exemption provided by Regulation A under the Securities Act.

The foregoing issuances of shares, except for the shares issued pursuant to our Regulation A offering, are intended to be exempt from registration pursuant to Section 4(a)(2) and/or Rule 506 of Regulation D of the Securities Act of 1933, as amended (the “Securities Act”), since the stockholders involved in such issuances represented that each was acquiring the shares of common stock for investment purposes only, and not with a view towards distribution or resale except in compliance with applicable securities laws. No general solicitation or advertising was used in connection with any transaction, and the certificate evidencing the securities that were issued contained a legend restricting their transferability absent registration under the Securities Act of 1933, as amended (the “1933 Act”), or the availability of an applicable exemption therefrom. There were less than 35 non-accredited investors that have received shares of common stock pursuant to the Downstream Merger and Rhove acquisition transactions. Unless specifically set forth below, no underwriter participated in the transaction and no commissions were paid in connection with the transactions.

No financial statement schedules are provided because the information called for is not required or is shown in the consolidated financial statements or related notes.

Pursuant to the requirements of the Securities Act of 1933, as amended, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the city of Dublin, Ohio, on this 17th day of April, 2023.

Each of the undersigned officers and directors of reAlpha Tech, Corp. hereby constitutes and appoints Giri Devanur and Michael J. Logozzo, as the individual’s true and lawful attorneys-in-fact and agents, with full power of substitution and re-substitution, for the person and in his or her name, place and stead, in any and all capacities, to sign this registration statement of reAlpha Tech Corp. on Form S-1, and any other registration statement relating to the same offering (including any registration statement, or amendment thereto, that is to become effective upon filing pursuant to Rule 462(b) under the Securities Act of 1933, as amended), and any and all amendments thereto (including post-effective amendments to the registration statement), and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents, full power and authority to do and perform each and every act and thing requisite and necessary to be done in connection therewith, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents or any of them, or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act of 1933, as amended, this registration statement on Form S-1 has been signed by the following persons in the capacities set forth opposite their names and on the date indicated above.

Delaware		6500		86-3425507
(State or other jurisdiction of incorporation or organization)		(Primary Standard Industrial Classification Code Number)		(I.R.S. Employer Identification Number)

Mark Name	International Classes		Application Number		Filed Date	Owner

reAlpha M^{3 TM}		035		90670058	2021-04-25	reAlpha Tech Corp

reAlpha HUMINT^TM		035		90670061	2021-04-25	reAlpha Tech Corp

reAlpha BRAIN^TM		035		90670577	2021-04-25	reAlpha Tech Corp

reAlpha Hub^TM		035		90670055	2021-04-25	reAlpha Tech Corp

IPO – Investment Property Offering		042		97603076	2022-09-22	reAlpha Tech Corp

Vacation Capitalist		036		97703446	2022-12-05	reAlpha Tech Corp

	Three months ended January 31, 2023			Three months ended January 31, 2022
	Amount			Amount
Rental Income	$	37,070		$	95,000
Cost of sales	$	(7,785	)	$	(24,781	)
Gross profit	$	29,285		$	70,219
General, Administrative & Other Non-Operating Expenses	$	(1,495,788	)	$	(1,432,924	)
Total operating expenses	$	(67,683	)	$	(70,372	)
Provision for income taxes	$	-		$	-
Net loss	$	(1,534,186	)	$	(1,433,077	)
Less: Net Loss Attributable to Non-Controlling Interests	$	-		$	2,211
Net Loss Attributable to ReAlpha Tech Corp. (f.k.a. ReAlpha Asset Management, Inc.)	$	(1,534,186	)	$	(1,430,866	)

	Nine months ended January 31, 2023			Nine months ended January 31, 2022
	Amount			Amount
Rental Income	$	96,860		$	168,771
Cost of sales	$	(20,336	)	$	(37,758	)
Gross profit	$	76,524		$	131,013
General, Administrative & Other Non-Operating Expenses	$	(3,004,491	)	$	(1,956,136	)
Total operating expenses	$	(221,366	)	$	(208,508	)
Provision for income taxes	$	-		$	-
Net loss	$	(3,149,333	)	$	(2,033,631	)
Less: Net Loss Attributable to Non-Controlling Interests	$	-		$	(8,082	)
Net Loss Attributable to ReAlpha Tech Corp. (f.k.a. ReAlpha Asset Management, Inc.)	$	(3,149,333	)	$	(2,025,549	)

	Fiscal year ended April 30, 2022			Fiscal year ended April 30, 2021
	Amount			Amount
Rental Income	$	229,672		$	784
Cost of sales	$	(55,717	)	$	(199	)
Gross profit	$	173,955		$	585
General, Administrative & Other Non-Operating Expenses	$	(2,995,365	)	$	(2,809	)
Total operating expenses	$	(381,932	)	$	(1,189	)
Provision for income taxes	$	-		$	-
Net loss	$	(3,203,342	)	$	(3,413	)
Less: Net Loss Attributable to Non-Controlling Interests	$	(13,304	)	$	(71	)
Net Loss Attributable to ReAlpha Tech Corp. (f.k.a. ReAlpha Asset Management, Inc.)	$	(3,190,038	)	$	(3,342	)

Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
		Emerging growth company	☒

		Page
Prospectus Summary		1
Information Regarding Forward-Looking Statements		i
Risk Factors		13
Trademarks, Service Marks, Copyrights and Tradenames		43
Use of Proceeds		44
Market Information for Securities and Dividend Policy		44
Management’s Discussion and Analysis of Financial Condition and Results of Operations		45
Business		53
Management		68
Executive Compensation		74
Principal Stockholders		77
Certain Relationships and Related Party Transactions		78
Registered Stockholders		79
Description of Securities		84
Material U.S. Federal Income Tax Consequences to Non-U.S. Holders		88
Plan of Distribution		93
Legal Matters		95
Experts		95
Where You Can Find More Information		95

	Three months ended January 31,
	2023			2022			% Change
Gross Profit	$	29,285		$	70,372			(58.3	)%
Gross Margin %		78.9	%		73.9	%		5.00	%

	Nine months ended January 31,
	2023			2022			% Change
Gross Profit	$	76,524		$	131,013			(41.6	)%
Gross Margin %		79.0	%		77.6	%		1.4	%

	Year ended April 30,
	2022			2021			% Change
Gross Profit	$	173,955		$	585			29,636	%
Gross Margin %		75.7	%		74.6	%		1.1	%

	Nine Months Ended						Year Ended
Particulars	January 31, 2023			January 31, 2022			April 30, 2022			April 30, 2021

Net cash used in operating activities	$	(4,478,549	)	$	(30,482	)	$	(1,558,025	)	$	(11,326	)
Net cash used in investing activities	$	1,687,271		$	(2,322,374	)	$	(2,645,816	)	$	(98,189	)
Net cash provided by financing activities	$	3,644,095		$	4,485,184		$	5,533,173		$	442,735

Properties	City & State	Mortgage Loan Amount
506 West Parnell Street	Denison, Texas	$	98,000
503 North Patton Avenue	Dallas, Texas	$	177,974
3121 Fieldview Drive	Garland, Texas	$	228,750
Joaquin	Dallas, Texas	$	226,737
606 West Acheson Street	Denison, Texas	$	110,250
746 Greenland Way	Grand Praire, Texas	$	217,500
790 Pebble Beach Drive	Champions Gate, Florida	$	276,553
612 Jasmine Lane	Davenport, Florida	$	337,242
7676 Amazonas Street	Kissimmee, Florida	$	266,204
2540 Hamlet Lane	Kissimmee, Florida	$	342,000
Total		$	2,281,211

Name	Age	Position	Term of Office
Board Members
Brian Cole (1)(2)(3)	43	Independent Director	Since Inception
Monaz Karkaria	49	Director (formerly COO from Inception until resignation in January 2022)	Since January 2022
Dimitrios Angelis (1)(2)(3)	53	Independent Director	Since April 2023
Balaji Swaminathan (1)(2)(3)	58	Independent Director	Since April 2023
Executive Officers
Giri Devanur	52	Chief Executive Officer, President and Chairman of the Board of Directors	Since Inception Since April 2023
Michael J. Logozzo	50	Chief Financial Officer	Since Inception
Jorge Aldecoa	38	Chief Operating Officer	Since April 2023
Christie Currie	26	Chief Marketing Officer	Since Inception

	●	appoint, compensate, and oversee the work of any registered public accounting firm employed by us;

	●	resolve any disagreements between management and the auditor regarding financial reporting;

	●	pre-approve all auditing and non-audit services;

	●	retain independent counsel, accountants, or others to advise the audit committee or assist in the conduct of an investigation;

	●	seek any information it requires from employees, all of whom are directed to cooperate with the audit committee’s requests-or external parties;

	●	oversee and report to the board of directors regarding the Company’s major financial risk exposures, as well as areas including cybersecurity, information technology and data security risks;
	●	meet with our officers, external auditors, or outside counsel, as necessary; and

	●	oversee that management has established and maintained processes to assure our compliance with all applicable laws, regulations and corporate policy.

	●	discharge the responsibilities relating to certain disclosures in public filings of the Company, including, but not limited to, in the Company’s proxy statement, Annual Report on Form 10-K and Quarterly Report on Form 10-Q;

	●	discharge the responsibilities of the board of directors relating to compensation of the our directors, executive officers and other key employees;

	●	review and make recommendations to the board of directors in establishing appropriate incentive compensation and equity-based plans;

	●	oversee the annual process of evaluation of the performance of our management; and

	●	perform such other duties and responsibilities as enumerated in and consistent with compensation committee’s charter.

	●	assist the board of directors by identifying qualified candidates for director nominees, including through search firms to assist in identifying qualified director nominees, and to recommend to the board of directors the director nominees for the next annual meeting of stockholders;

	●	establish procedures to be followed by stockholders in submitting recommendations for director candidates to the nominating and governance committee;

	●	lead the board of directors and board of directors committees in their annual review of their performance;

	●	recommend to the board director nominees for each committee of the board of directors; and

	●	develop and recommend to the board of directors corporate governance guidelines applicable to us.

Name and Principal Position	Year	Salary ($)			Stock Awards ($)		Bonus (1)		All other compensation ($)			Total Compensation ($)
Giri Devanur	2022		100,000	(2)		-		64,500		12,500	(4)		177,000
Chief Executive Officer and President	2021		-	(3)		-		-		-			-
Michael J. Logozzo	2022		140,000			-		55,000		-			195,000
Chief Financial Officer and Interim Chief Operating Officer	2021		26,250			-		-		-			26,650
Christine Currie	2022		92,243			-		32,250		42,288	(5)		166,781
Chief Marketing Officer	2021		3,333			-		-		-			3,333

Name	Year	Fees Earned and Paid in Cash ($)		Option Awards ($)		Stock Awards ($)		Total ($)
Giri Devanur	2022		12,500		-		-		12,500
Monaz Karkaria	2022		6,250		-		-		6,250
Brian Cole	2022		12,500		-		-		12,500
Brent Crawford	2022		12,500		-		-		12,500
Dr, Art Langer	2022		12,500		-		-		12,500

Name of Beneficial Owner	Number of Shares Beneficially Owned		Percentage of Shares Beneficially Owned Before Offering			Percentage of Shares Beneficially Owned After Offering
5% Stockholders

Brent Crawford (1)		2,370,995		5.6	%		5.6	%
Directors and Named Executive Officers

Monaz Karkaria		2,947,991		6.9	%		6.9	%
Brian Cole		368,499		*			*
Dimitrios Angelis		-		*			*
Balaji Swaminathan		-		*			*
Giri Devanur		27,637,410		65.0	%		65.0	%
Mike Logozzo		2,199,938		5.1	%		5.1	%
Christie Currie		1,473,995		3.5	%		3.5	%

All executive officers and directors as a group (8 persons)		37,367,327		87.8	%		87.8	%

	●	the related person’s interest in the related-person transaction;

	●	the approximate dollar amount involved in the related-person transaction;

	●	the approximate dollar amount of the related person’s interest in the transaction without regard to the amount of any profit or loss;

	●	whether the transaction was undertaken in the ordinary course of our business;

	●	whether the terms of the transaction are no less favorable to us than terms that could have been reached with an unrelated third party;

	●	the purpose of, and the potential benefits to us of, the related-person transaction; and

	●	any other information regarding the related-person transaction or the related person in the context of the proposed transaction that would be material to investors in light of the circumstances of the particular transaction.

	Beneficial Ownership Prior to the Effectiveness of the Registration Statement
	Number of Shares of Common Stock Beneficially Owned+		Total Number of Shares of Common Stock Being Registered Pursuant to this Prospectus		Percentage Ownership of Common Stock+
Name of Selling Stockholders:
Giri Devanur (1)		27,637,409		27,637,409		65.0	%
Monaz Karkaria (2)		2,947,991		2,947,991		6.93	%
Michael J. Logozzo (3)		2,199,938		2,199,938		5.17	%
Christine Currie (4)		1,473,996		1,473,996		3.47	%
Jorge Aldecoa (5)		368,499		368,499		*
Bhaargav Kosuri (6)		460,623		460,623		*
Saching Garg (7)		368,499		368,499		*
Ravi Srinivas (8)		368,499		368,499		*
Dr. Art Langer (9)		368,499		368,499		*
Brian Cole (10)		368,499		368,499		*
Brent Crawford (11)		2,370,995		2,370,995		5.58	%
Rakesh Prasad Hosur Rama Prasad (12)		276,374		276,374		*
Jonas Meyer (13)		276,374		276,374		*
Plato Ghinos (14)		92,125		92,125		*
Paul Cecil (15)		92,125		92,125		*
Michael Haring (16)		92,125		92,125		*
Dru Rai (17)		92,125		92,125		*
Viktor Boskovski (18)		55,275		55,275		*
Srinidhi Kuruvadi Anantharaju (19)		18,425		18,425		*
Ram Prasanna Kharvi (20)		18,425		18,425		*
Gabby Bajorek (21)		18,425		18,425		*
Austin Knisley (22)		18,425		18,425		*
Tejas Gupta (23)		11,055		11,055		*
Prem Kumar Dayyala (24)		11,055		11,055		*
Nikhil Besta (25)		11,055		11,055		*
Nagaraj Kharvi (26)		11,055		11,055		*
Holly Scholl (27)		11,055		11,055		*

	●	U.S. expatriates and former citizens or long-term residents of the United States;

	●	persons holding our common stock as part of a hedge, straddle, or other risk reduction strategy or as part of a conversion transaction or other integrated investment;

	●	banks, insurance companies, and other financial institutions;

	●	brokers, dealers, or traders in securities;

	●	“controlled foreign corporations,” “passive foreign investment companies,” and corporations that accumulate earnings to avoid U.S. federal income tax;

	●	partnerships or other entities or arrangements treated as partnerships for U.S. federal income tax purposes (and investors therein);

	●	tax-exempt organizations or governmental organizations;

	●	persons deemed to sell our common stock under the constructive sale provisions of the Code;

	●	persons who hold or receive our common stock pursuant to the exercise of any employee stock option or otherwise as compensation;

	●	tax-qualified retirement plans; and

	●	“qualified foreign pension funds” as defined in Section 897(l)(2) of the Code and entities all of the interests of which are held by qualified foreign pension funds.

	●	an individual who is a citizen or resident of the United States;

	●	a corporation (or entity treated as a corporation for United States federal income tax purposes) created or organized in or under the laws of the United States, any state thereof or the District of Columbia;

	●	an estate, the income of which is includable in gross income for U.S. federal income tax purposes regardless of its source; or

	●	a trust if (i) a court within the United States is able to exercise primary supervision over the administration of the trust and one or more “United States persons,” as defined under the Code, (“U.S. persons”) have the authority to control all substantial decisions of the trust or (ii) such trust has made a valid election to be treated as a U.S. person for U.S. federal income tax purposes.

	Page
Consolidated Financial Statements (audited) for the Years Ended April 30, 2022 and 2021

Report of Independent Registered Public Accounting Firm (PCAOB ID 1808)	F-2

Consolidated Balance Sheets as of April 30, 2022 and 2021	F-3

Consolidated Statements of Operations for the Years Ended April 30, 2022 and 2021	F-4

Consolidated Statements of Stockholders’ Deficit for the Years Ended April 30, 2022 and 2021	F-5

Consolidated Statements of Cash Flows for Years Ended April 30, 2022 and 2021	F-6

Notes to the Consolidated Financial Statements	F-7

Condensed Consolidated Financial Statements (unaudited) for the three and nine months ended January 31, 2023 and 2022

Condensed Consolidated Balance Sheets as of January 31, 2023 (Unaudited) and April 30, 2022 (audited)	F-15

Condensed Consolidated Statements of Operations for the Three and Nine Months Ended January 31, 2023 and 2022 (Unaudited)	F-16

Condensed Consolidated Statements of Stockholders’ Deficit for the Nine Months Ended January 31, 2023 and 2022 (Unaudited)	F-17

Condensed Consolidated Statements of Cash Flows for Nine Months Ended January 31, 2023 and 2022 (Unaudited)	F-18

Notes to the Condensed Consolidated Financial Statements (Unaudited)	F-19

	Apr 30, 2022			Apr 30, 2021
	(Audited)			(Audited)
ASSETS
Investments in real estate, net	$	3,766,649		$	1,137,616
Cash		1,639,241			108,172
Restricted cash		23,311			225,048
Accounts receivable		133,797			-
Related party receivables		-			4,718
Prepaid expenses and other assets		110,114			5,670

TOTAL ASSETS	$	5,673,112		$	1,481,224


LIABILITIES AND EQUITY

Liabilities
Long-term debt, net	$	2,229,162		$	1,007,994
Settling subscriptions, net of offering costs		4,273,097			-
Accounts payable		54,972
Related party payables		1,712,426			-
Accrued expenses		35,210			1,643
Total liabilities		8,304,867			1,009,637

Equity
Common stock		40,010			40,000
Additional paid-in capital		509,990			410,000
Accumulated deficit		(3,193,380	)		(3,342	)
Total stockholders’ equity (deficit)		(2,643,380	)		446,658

Non-controlling interests members’ equity		11,625			24,929
Total stockholders’ (deficit) equity		(2,631,755	)		471,587

TOTAL LIABILITIES AND EQUITY	$	5,673,112		$	1,481,224

	Common Stock		Additional Paid-in Capital		Accumulated Deficit			ReAlpha Asset Management, Inc. and Subsidiaries Equity			Non- Controlling Interest Member’s Equity			Total Shareholder’s Equity

Balance at April 22, 2021	$	–	$	–	$	–		$	–		$	–		$	–
Net income	$	–	$	–	$	(3,342	)	$	(3,342	)	$	(71	)	$	(3,413	)
Contributions	$	40,000	$	410,000	$	–		$	450,000		$	25,000		$	475,000
Balance at April 30, 2021	$	40,000	$	410,000	$	(3,342	)	$	446,658		$	24,929		$	471,587
Net income		–		–		(3,190,038	)		(3,190,038	)		(13,304	)		(3,203,342	)
Contributions		10		99,990		–			100,000			–			100,000
Balance at April 30, 2022	$	40,010	$	509,990	$	(3,193,380	)	$	(2,643,380	)	$	11,625		$	(2,631,755	)

	Apr 30, 2022			Apr 30, 2021

Cash Flows from Operating Activities
Net loss	$	(3,203,342	)	$	(3,413	)
Adjustments to reconcile net loss to net cash and restricted cash used in operating activities:
Depreciation and amortization		146,295			832
Gain on sale of real estate investments		(34,853	)
Changes in operating assets and liabilities:
Accounts receivable		(133,797	)		-
Related party Receivable		4,718			(4,718	)
Prepaid expenses and other current assets		(104,444	)		(5,670	)
Accounts payable		54,972			-
Related party payables		1,712,426			-
Accrued expenses		-			1,643

Total adjustments		1,645,317			(7,913	)

Net cash and restricted cash used in operating activities		(1,558,025	)		(11,326	)

Cash Flows from Investing Activities
Additions to real estate investments		(4,337,460	)		(98,189	)
Proceeds from sale of real estate Investment		1,691,644			-

Net cash and restricted cash used in investing activities		(2,645,816	)		(98,189	)

Cash Flows from Financing Activities
Proceeds from issuance of long-term debt		2,673,351			-
Payments of long-term debt		(1,420,987	)
Deferred financing costs		(92,288	)		-
Contributions		100,000			98,000
Settling subscription stock contributions		4,273,097			344,735

Net cash and restricted cash provided by financing activities		5,533,173			442,735

Net increase in cash and restricted cash		1,329,332			333,220

Cash and Restricted Cash - Beginning of Year		333,220			-
Cash and Restricted Cash - End of Year	$	1,662,552		$	333,220

Reconciliation of Cash and Restricted Cash:
Cash		1,639,241			108,172
Restricted cash		23,311			225,048
Total cash and restricted cash	$	1,662,552		$	333,220

Name of Subsidiary	% of Ownership
reAlpha Series 1 LLC		75	%
reAlpha 1011 Gallagher LLC		75	%
reAlpha Acquisitions LLC		100	%
reAlpha Acquisitions WF LLC		100	%
reAlpha Acquisitions Churchill LLC		100	%
reAlpha 503 North Patton LLC		100	%
reAlpha 7 LLC		100	%
reAlpha LLC		100	%
reAlpha Series 2 LLC		100	%

			Accumulated
			Depreciation and			Net
	Cost		Amortization			Investment
Land	$	218,557	$	-		$	218,557
Buildings and building improvements		1,713,265		(10,058	)		1,703,207
Appliances, Furniture and fixtures		46,952		(520	)		46,432
Total investment in real estate	$	1,978,774	$	(10,578	)	$	1,968,196

			Accumulated			Net
	Cost		Depreciation			Investment

Land	$	170,783	$	-		$	170,783
Buildings and building improvements		955,493		(855	)		954,638
Furniture and fixtures		12,367		(172	)		12,195
Total investment in real estate	$	1,138,643	$	(1,027	)	$	1,137,616

	April 30,			April 30,
	2022			2021

Mortgage note with a bank. The note bears interest at a rate of 8.49% and provides for monthly interest payments. The note matures on September 1, 2022, at which time there is a balloon payment of remaining principal and interest due, and is secured by the property as well as guaranteed by a shareholder of the Company.	$	217,500		$	-

Mortgage note with a bank. The note bears interest at a rate of 8.49% and provides for monthly interest payments. The note matures on July 1, 2022, at which time there is a balloon payment of remaining principal and interest due, and is secured by the property as well as guaranteed by a shareholder of the Company.		110,250			-

Mortgage note with a bank. The note bears interest at a rate of 8.49% and provides for monthly interest payments. The note matures on May 1, 2022, at which time there is a balloon payment of remaining principal and interest due, and is secured by the property as well as guaranteed by a shareholder of the Company.		226,737			-

Mortgage note with a bank. The note bears interest at a rate of 8.49% and provides for monthly interest payments. The note matures on August 1, 2022, at which time there is a balloon payment of remaining principal and interest due, and is secured by the property as well as guaranteed by a shareholder of the Company.		228,750			-

Mortgage note with a bank. The note bears interest at a rate of 8.49% and provides for monthly interest payments. The note matures on October 1, 2022, at which time there is a balloon payment of remaining principal and interest due, and is secured by the property as well as guaranteed by a shareholder of the Company.		177,974			177,974

Mortgage note with a bank. The note bears interest at a rate of 8.49% and provides for monthly interest payments. The note matures on November 1, 2022, at which time there is a balloon payment of remaining principal and interest due, and is secured by the property as well as guaranteed by a shareholder of the Company.		98,000			98,000

Mortgage note with a bank. The note bears interest at a rate of 5% + Prime with floor of 8.25% and provides for monthly interest payments. The note matures on February 10, 2023 at which time there is a balloon payment of remaining principal and interest due, and is secured by the property as well as guaranteed by a shareholder of the Company.		880,000			-

Mortgage note with a bank. The note bears interest at a rate of 4.75% + Prime with floor of 8.25% and provides for monthly interest payments. The note matures on April 15, 2023 at which time there is a balloon payment of remaining principal and interest due, and is secured by the property as well as guaranteed by a shareholder of the Company.		342,000			-

Mortgage note with a bank. The note bears interest at a rate of 8.49% and provides for monthly interest payments. The note matures on February 1, 2022, at which time there is a balloon payment of remaining principal and interest due, and is secured by the property as well as guaranteed by a shareholder of the Company.		-			150,000

Mortgage note with a bank. The note bears interest at a rate of 8.49% and provides for monthly interest payments. The note matures on May 1, 2022, at which time there is a balloon payment of remaining principal and interest due, and is secured by the property as well as guaranteed by a shareholder of the Company.		-			226,737

Mortgage note with a bank. The note bears interest at a rate of 8.49% and provides for monthly interest payments. The note matures on January 1, 2022, at which time there is a balloon payment of remaining principal and interest due, and is secured by the property as well as guaranteed by a shareholder of the Company.		-			152,136

Mortgage note with a bank. The note bears interest at a rate of 8.49% and provides for monthly interest payments. The note matures on September 1, 2021, at which time there is a balloon payment of remaining principal and interest due, and is secured by the property as well as guaranteed by a shareholder of the Company.		-			126,000

Mortgage note with a bank. The note bears interest at a rate of 8.49% and provides for monthly interest payments. The note matures on September 1, 2021, at which time there is a balloon payment of remaining principal and interest due, and is secured by the property as well as guaranteed by a shareholder of the Company.		-			98,000

Total Long-term debt	$	2,281,211		$	1,028,847
Less: Deferred financing costs, net		(52,048	)		(20,853	)
Total Long-term debt, net	$	2,229,163		$	1,007,994

2022	$	1,059,211
2023		1,222,000
Less: unamortized costs		(52,048	)
Total long-term debt, net	$	2,229,163

	Jan 31, 2023			Apr 30, 2022
	(unaudited)			(Audited)
ASSETS
Investments in real estate, net	$	2,167,368		$	3,766,649
Cash		2,312,629			1,639,241
Restricted cash		202,740			23,311
Accounts receivable		14,779			133,797
Prepaid expenses and other assets		108,095			110,114

TOTAL ASSETS	$	4,805,611		$	5,673,112

LIABILITIES AND EQUITY

Liabilities
Long-term debt, net	$	1,452,961		$	2,229,162
Settling subscriptions, net of offering costs		33,409			4,273,097
Accounts payable		191,185			54,972
Related party payables		314,096			1,712,426
Accrued expenses		232,831			35,210
Total liabilities		2,224,482			8,304,867

Equity
Common stock		40,852			40,010
Additional paid-in capital		8,882,989			509,990
Accumulated deficit		(6,342,712	)		(3,193,380	)
Total stockholders' equity (deficit)		2,581,129			(2,643,380	)

Non-controlling interests members' equity		-			11,625
Total stockholders' equity (deficit)		2,581,129			(2,631,755	)

TOTAL LIABILITIES AND EQUITY	$	4,805,611		$	5,673,112