Form 10-K Recruiter.com Group, For: Dec 31

Overview

Recruiter.com
Group, Inc. (“we,” “the Company”, “Recruiter.com”, “us”, “our”) operates
an on-demand recruiting platform aiming to disrupt the $120 billion recruiting and staffing industry. We combine an online hiring
platform with the world’s largest network of over 28,000 small and independent recruiters. Businesses of all sizes recruit
talent faster using the Recruiter.com platform, which is powered by virtual teams of Recruiters On Demand and Video and
Artificial Intelligence (“AI”) job-matching technology.

Our website, www.Recruiter.com, provides
employees seeking to hire access to over 28,000 independent recruiters and utilizes an innovative web platform, with integrated
AI-driven candidate to job matching and video screening software to more easily and quickly source qualified talent.

We
help businesses accelerate and streamline their recruiting and hiring processes by providing on-demand recruiting services. We
leverage our expert network of recruiters to place recruiters on a project basis, aided by cutting edge AI-based candidate sourcing,
and matching and video screening technologies. We operate a cloud-based scalable SaaS-enabled marketplace platform for professional
hiring, which provides prospective employers access to a network of thousands of independent recruiters from across the country
and worldwide, with a diverse talent sourcing skillset that includes information technology, accounting, finance, sales, marketing,
operations and healthcare specializations. 

Through our Recruiting.com Solutions division,
we also provide consulting and staffing, and fulltime placement services to employers which leverages our platform and rounds out
our services.

Our mission is to grow our most
collaborative and connective global platform to connect recruiters and employers and become the preferred solution for hiring specialized
talent. 

Corporate History

Effective March 31, 2019 (the “Effective
Date”), we completed a merger with Recruiter.com, Inc. (“Pre-Merger Recruiter.com”), an affiliate of the Company,
pursuant to a Merger Agreement and Plan of Merger, dated March 31, 2019 (the “Merger”). At the effective time of the
Merger, our newly formed wholly-owned subsidiary merged with and into Recruiter.com, with Recruiter.com continuing as the surviving
corporation and our wholly-owned subsidiary. As consideration in the Merger, the equity holders of Pre-Merger Recruiter.com received
a total of 775,000 shares of our newly designated Series E convertible preferred stock (“Series E Preferred Stock”)
convertible into approximately 9,687,500 shares of the Company’s common stock, par value $0.0001 per share (the “Common
Stock”). As a result, the former stockholders of Pre-Merger Recruiter.com controlled approximately 90{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} of our outstanding
Common Stock and in excess of 50{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} of the total voting power of the Company.

Following the Merger, on May 9, 2019, we
changed our corporate name to Recruiter.com Group, Inc. Our fiscal year end was also changed, as of the Effective Date, from March
31 to December 31.

Immediately prior to the completion of
the Merger, Pre-Merger Recruiter.com owned approximately 98{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} of our outstanding Common Stock. The Merger did not result in a change
of control of our Company, as the principal stockholders of Pre-Merger Recruiter.com had controlled the Company since October 2017
and the Merger simply increased their control. In addition, our Chief Executive Officer served as the Chief Executive Officer of
Pre-Merger Recruiter.com and the majority of our directors were directors (or designees) prior to the Merger. Further, our Executive
Chairman was retained as a consultant prior to the Merger with the understanding that if the Merger occurred, he would be appointed
Executive Chairman of the Company.

Prior to the completion of the Merger,
Pre-Merger Recruiter.com distributed to its stockholders the 1,562,500 shares of our Common Stock that it had previously acquired
as consideration pursuant to the license agreement with us. See “Part III. Item 13 – Certain Relationships and Related
Transactions – Recruiter.com License” for further information.

For accounting purposes, the Merger was
accounted for as a reverse recapitalization of Pre-Merger Recruiter.com and combination of entities under common control (“recapitalization”)
with Pre-Merger Recruiter.com considered the accounting acquirer and historical issuer. Our consolidated financial statements are
the financial statements of Pre-Merger Recruiter.com. Since Pre-Merger Recruiter.com owned a majority interest in the Company prior
to the completion of the Merger, the consolidated financial statements contained herein include the historical operations of the
Company and VocaWorks, Inc., (“VocaWorks”), the Company’s wholly-owned subsidiary. All share and per share data
in the consolidated financial statements and the accompanying notes have been retroactively restated to reflect the effect of the
Merger.

Genesys Asset Purchase

Effective March 31, 2019, we acquired certain
assets and assumed certain liabilities under an asset purchase agreement, dated March 31, 2019, among the Company, Genesys Talent
LLC, a Texas limited liability company (“Genesys”), and Recruiter.com Recruiting Solutions, LLC, a Delaware limited
liability company and a wholly-owned subsidiary of the Company (the “Asset Purchase”). As consideration in the Asset
Purchase, Genesys received a total of 200,000 shares of our newly designated Series F convertible preferred stock (the “Series
F Preferred Stock”) convertible into approximately 2,500,000 shares of our Common Stock. The acquired assets and liabilities
include certain accounts receivable, accounts payable, deferred revenue, sales and client relationships, contracts, intellectual
property, partnership and vendor agreements and certain other assets. The Company is utilizing these assets in its employment staffing
business operated through Recruiter.com Recruiting Solutions, LLC (“Recruiting Solutions”). This transaction was treated
as a business combination for accounting purposes.

Reverse Stock Split

In August of 2019, we effected a reverse
stock split of its issued and outstanding common stock at a ratio of 1-for-80 (the “2019 Reverse Stock Split”). The
number of shares and price per share information included in this Annual Report on Form 10-K reflect the effect of the 2019 Reverse
Stock Split.

OneWire Asset Purchase

On December 22, 2020, we announced that
we entered into a binding letter of intent (the “OneWire LOI”) to acquire Onewire,
Inc. (“Onewire”), a leading SaaS-based recruiting and software platform focused on the financial services sector. The
acquisition will include the OneWire SaaS hiring platform and job site (www.onewire.com), Matchbook software (www.matchbook.io),
a tool for curating and presenting screened and vetted talent which OneWire developed, and Onewire’s executive
search business. While the definitive agreement is currently in the process of being negotiated, the OneWire LOI provides
for up to a $1.255 million purchase price. The Company will pay the entire purchase price in shares of Common Stock with a portion
of the purchase price to be paid on the basis of a earn-out following the completion of an audit of OneWire’s financial statements.

Scouted Asset Purchase

Effective January 31, 2021, the Company,
through a wholly-owned subsidiary, acquired all assets of RLJ Talent Consulting, Inc., dba Scouted, a Delaware corporation (“Scouted”)
(the “Scouted Asset Purchase”). As consideration in the Scouted Asset Purchase, Scouted shareholders will receive a
total of 514,666 shares of our restricted common stock (valued at $1,441,065 based on a $2.80 per share grant date price), of which
76,113 shares of stock will be held in reserve, and an additional amount of $180,000 in cash consideration for a total purchase
price of approximately $1.6 million. The Scouted Asset Purchase will be accounted for as a business acquisition. The assets acquired
in the Scouted Asset Purchase consist primarily of sales and client relationships, contracts, intellectual property, partnership
and vendor agreements and certain other assets (the “Scouted Assets”), along with a de minimis amount of other assets.
The Company will complete the purchase price allocation of the $1.6 million for the acquired intangible assets during 2021. . The
Company is utilizing the Scouted Assets to expand its video hiring solutions and curated talent solutions, through its Recruiting
Solutions subsidiary. 

Market Opportunity

Industry Overview

According to the U.S. Staffing Industry
Forecast, published in July 2020 by Staffing Industry Analysts (“SIA”), the total recruiting and staffing revenue for
2020 is projected to be $126.1 billion; an increase from SIA’s April 2020 forecast, which predicted $119.4 billion in revenue.
For 2021, SIA also projected double-digit growth of 11{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} in temporary staffing revenue and a 19{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} overall expansion in the placement
and employment search market.

This total industry market size includes
companies that help other organizations find staff on a temporary or permanent basis, with the temporary staffing segment being
significantly larger. The need for qualified and, in many cases, highly specialized talent, can be fulfilled by assisting companies
in recruiting new internal staff or directly providing temporary staff to fill specific functions.

Overall, the U.S. recruitment industry
is enormous, and it continues to grow, driven mainly by robust GDP growth creating demand for both direct-hire and contingent (project-based)
workers. Demographic trends are also accelerating the demand for recruitment services: According to Seniorliving.org, approximately
10,000 persons from the “Baby-Boomer Generation” will retire each day in 2020, and employers often turn to the recruiting
industry to close these talent gaps. Overall corporate spending in recruiting technology continues to grow, expected to surpass
$10 billion by 2022, according to Jason Corsello, General Partner of Acadian Ventures.

In light of this market potential, the appetite for on-demand
recruiting and talent acquisition technology companies has been robust. According to a “Recruitment Software Market Forecast
and Analysis 2020-2024” published by Technavio, the global recruitment software market will expand by $683.8 million during
2020-2024. The same report details that even amid the COVID-19 pandemic, the global recruitment software market registered a YOY
growth of 4.74{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} in 2020, with the market estimated to expand at a CAGR of over 5{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} during the forecast period of 2020-2024.

With employers continuing to struggle to find relevant candidates
and more than 6.6 million open jobs in the US as of December 2020 according to the Job Opening and Labor Turnover report by the
Bureau of Labor Statistics published on February 9, 2021, recruiting represents an enormous market opportunity. According to the
leading human resource association, the Society for Human Resource Management, external sources—whether online job boards,
recruiting agencies, campus events, job fairs, or walk-ins—produce approximately 62{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} of interviews compared to internal sources
such as career sites, in-house recruiters and employee referrals (38{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3}). This 62{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} of role interviews generated by external sources
provide a significant market opportunity for innovative recruiting technology companies to capture. 

Industry Trends

COVID-19

The recent COVID-19 pandemic had a dramatic
effect on the US economy and the job market. Unemployment peaked at 14.7{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} in April of 2020. Since then, labor markets have been
continually improving, with the unemployment rate falling to 6.7{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} in January 2021. The Federal Reserve forecasts that the unemployment
rate will continue to fall, reaching 5{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} in 2021. The Federal Reserve anticipates improved employment for the coming years, with
the unemployment rate dropping to 3.7{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} by 2023.

Our management team believes that COVID-19
accelerated major technology trends that had already existed before the pandemic. For example, the growth of the gig economy (i.e.
temporary, flexible jobs) was facilitated by technology, virtual and remote tele-work with video and the emergence of on-demand
labor through online marketplaces all happened before the crisis. The necessity of lockdowns and business closures drove increased
technology adoption and moved these trends rapidly forward. As we operate as virtual, AI and video-based hiring platform operating
in the gig economy, these trends may act as headwinds for the adoption of our products and services.

Recruiting Outsourcing

We provide through our on-demand platform
a form of recruiting outsourcing for employers. By using our services, employers are effectively relieving their human resources
departments of the costs and labor associated with recruitment and talent acquisition. The current economic climate may move more
companies to increase their use of such outsourcing. For example, a report from Brandon Gaille issued in May 2017 found that, in
the aftermath of the Great Recession, a majority of employers (57{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3}) increased their use of outsourcing, with only a small percent
(9{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3}) of employers ending such outsourcing arrangements. Recruitment outsourcing promises cost-effective and efficient process improvements,
and employers may again increase their use of outsourcing to navigate the current environment.

The use of recruitment process outsourcing (RPO) is accelerating.
According to its report, “Global Recruitment Process Outsourcing Industry,” Reportlinker projects that the RPO industry
will reach a revised size of $14.4 billion by 2027, growing at a CAGR of 13.8{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3}, with the current U.S. Market estimated at $1.7
billion. We offer two forms of recruitment process outsourcing through the performance -based hiring solution of its job market
platform, which allows employers to pay for successful hires and its Recruiter.com On Demand offering, which enables businesses
to engage recruiters on a flexible project or hourly basis. We additionally have active RPO customers, for which we provide on-demand
recruiting labor. 

Online Talent Platforms

According to a study developed by the McKinsey
Global Institute, online talent platforms are the future of hiring and could add $2.7 trillion, or 2.0 percent, to global GDP by
2025. The firm projected that 10 percent of the worldwide labor force, or 540 million people, could benefit in various ways from
online talent platforms by 2025. There is growth in demand for both remote workers and outside consultants. Overall, in 2020, IBISWorld
estimates the number of temporary employees will increase by 1.8{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3}. Online talent marketplaces, such as Recruiter.com, may benefit
as a result.

McKinsey’s Future of Work in America
report states: “In a more technology-driven world, job-matching efforts can be aided by a range of new digital tools and
should run on easily accessible digital platforms. New online tools can assess an individual’s skills, suggest appropriate
career choices, and clarify which jobs are in demand and the credentials needed to obtain them.” There is a clear need for
efficient technology platforms that can adapt to rapidly changing job demands, such as ours.

Again, the current economic climate and
COIVD-19 may have accelerated these technology trends. During the recent COVID-19 epidemic, D’Arcy Coolican and Jeff Jordan
of famed venture capital firm Andreessen Horowitz stated in an article entitled “COVID-19 and the Great Re-Hiring”
that “If there was ever a time to start a specialized jobs platform, it’s now.”

Operating Businesses and Revenue

The Company has four wholly-owned and active subsidiaries: Recruiter.com,
Inc., Recruiter.com Recruiting Solutions LLC (“Recruiting Solutions”), Recruiter.com Consulting, LLC, VocaWorks, Inc.
(“VocaWorks”) and Recruiter.com Scouted, Inc. (“Scouted”). As of March 5, 2020, the Company employed 270
employees in 19 states.

We generate revenue from the following
activities:

The costs of our revenue primarily consist
of employee costs, third-party staffing costs and other fees, outsourced recruiter fees and commissions based on a percentage of
Recruiting Solutions gross margin.

Our results of operations and financial
condition may be impacted positively and negatively by certain general macroeconomic and industry wide conditions, such as the
effects of the COVID-19 pandemic. The consequences of the pandemic and impact on the U.S. and global economies continue to evolve
and the full extent of the impact is uncertain as of the date of this filing. The pandemic has had a detrimental effect on many
recruitment technology companies and on the general employment and staffing industry. If the recovery from the COVID-19 pandemic
is not robust, the impact could be prolonged and severe. We have reduced certain billing rates to respond to the current economic
climate. Additionally, while we have experienced, and could continue to experience, a loss of clients as the result of the pandemic,
we expect that the impact of such attrition would be mitigated by the addition of new clients resulting from our continued efforts
to adjust the Company’s operations to meet the demands of the greater recruitment industry. The extent to which the COVID-19
pandemic will further impact our operations, ability to obtain financing or future financial results is uncertain at this time.
As a result of COVID-19, the Company took steps to streamline certain expenses, including temporarily cutting certain executive
compensation packages by approximately 20{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3}. Management also worked to reduce unnecessary marketing expenditures and worked to improve
staff and human capital expenditures, while maintaining overall workforce levels. The Company does not expect reductions made in
Q2 2020 due to COVID-19 to inhibit its ability to meet client demand. Overall, management is focused on effectively positioning
the Company for a rebound in hiring, which we expect to occur in 2021. Ultimately, the recovery may be delayed and the economic
conditions may worsen. The Company continues to closely monitor the confidence of its recruiter users and customers, and their
respective job requirement load through offline discussions and the Company’s Recruiter Index survey, which surveys recruiters’
sentiment on the job market and demand for recruiting services.

Disrupting an Industry – Recruit Talent Faster

We believe we are fundamentally modernizing
the recruiting process by digitizing and democratizing the recruiting process. We are distributing both the work and opportunity
of recruiting to a broader community than ever before, enabling people to earn money through our platform and be their own bosses.
Furthermore, we are dispersing the economic benefits of successful recruitment to a broad group of people and, by doing so, we
help businesses recruit talent faster and more efficiently than ever before.

Community and Network

Our network currently consists of over
28,000 small and independent recruiters. This virtual network of recruiters unite under our innovative web platform that offers
earnings opportunities through successful job matching; access to matched candidates driven by artificial intelligence; and on-demand,
project-based recruiting assignments.

The community or network of recruiters
is additionally categorized into virtual teams based on industry vertical, skill or location specialization, and dedicated client
resource teams. Through participation in a virtual team, recruiters may receive further job and account updates, personalized recommendations,
exclusive job opportunities, and recommended candidate referrals. We operate these teams through its platform and facilitate real-time
communication through parallel chat rooms managed by our internal community managers.

We believe the potential scale of our recruiting
community is enormous. Similar to how Uber created the opportunity for anyone to become a taxi driver, we make it possible for
anyone to become a recruiter. The American Staffing Association cites about 25,000 staffing and recruiting companies, which altogether
operate around 49,000 offices, so the recruiting industry’s contribution to employment is significant. However, we enable
a broader disruption of the industry, bringing the opportunities to a much broader group of people than previously possible. Through
upskilling and engagement with our recruiter users, we make it easier for anyone to get involved in recruiting. With hundreds of
thousands of people involved in the general human resource and employment industry in the U.S. alone, and many more interested
in referral-based, work-from-home earning opportunities, we believe our addressable network and potential audience is vast.

The Recruiter.com Website – a Top Destination

Our website is a popular destination for
the recruiting and talent acquisition profession, with millions of pages of indexed content on career and recruitment issues and
trends, email newsletters, and digital publications issued every quarter. Our internet traffic is generated by three primary groups
of people: (1) recruiters seeking to join the network and platform, (2) enterprises seeking to recruit talent, and (3) candidates
seeking to find opportunities through the community of recruiters. Overall, we are a well-known brand in the recruiting industry,
and our vision is to build upon this success to become a clear leader in terms of traffic, mindshare, and usage within the business
of recruiting.

A comprehensive search engine optimization
strategy fuels our marketing. SpyFu.com, a traffic analysis website, estimated that, as of January 2021, our website has obtained
over 4,952 search terms on the first page of Google.com, resulting in an estimated click value of $4.14 million per month, which
is estimated by calculating the price of the Company’s organic traffic, were it to buy that traffic from paid search engine
listings, such as on Google.com. We also expanded our reach through social media as we are active on Twitter and Facebook, with
almost 50,000 followers on Twitter. Most notably, as of January 2021, we operated four of the top ten largest professional groups
in the world on the social media platform LinkedIn, out of over 1.8 million groups in total. One of our groups, The Recruiter.com
Network group on LinkedIn, has over 825,000 members.

In addition to our online thought leadership
and social media presence, we also attract recruiters and enterprises to our community and solution through our recruitment training
offering. Through our fully online Recruiter.com Certification Program (RCP) and Recruiter.com Academy, a live, instructor-led
program with CareerDash, we facilitate upskilling for experienced recruiters and easy entry into the profession for those new to
the tasks of recruiting and candidate sourcing. The Society for Human Resource Management (SHRM) has certified the RCP for re-education
credits and Recruiter.com intends to pursue similar accreditation for the Recruiter.com Academy program. After completing the RCP
course through an integrated online learning management system, we grant our users a certification and badge on their unique online
Recruiter.com profiles.

COVID-19 Implications

We are creating a highly collaborative
and connected global platform for professional recruiting, with the goal of becoming the top-of-mind solution for hiring talent
rapidly. Prior to the COVID-19 pandemic, the U.S. was in an incredibly tight job market, with the demand for talent at its highest
levels in years. Now, with millions of people out of work due to COVID-19 set to return to the job market over the next few years,
we believe businesses across the country must prepare to reopen or ramp up operations once again. We also believe these businesses
will need efficient ways to tap the massive talent pool resulting from the millions of Americans who are currently unemployed or
looking for better opportunities in new industries and companies. We believe that on-demand recruiting technology companies like
ours, which generate revenue not from the overall consistency of employment levels but rather from movement within labor markets
(i.e., job turnover), will benefit from this development. By combining cutting-edge artificial intelligence with a unified network
of more than 28,000 recruiters, we have built what we believe to be the most efficient recruiting network in the world —
and we are hoping to use our network to help get the US economy working again.

We believe we have the reach, technology,
recruiting expertise, and the scalability to connect employers across verticals with the right talent at the right price —
no matter where that talent is today. Our mission is clear: to help enable the great re-hiring. We will leverage our growing community
and expanding platform to get talented people to return to work as fast as possible, connecting people and creating economic opportunities.

Our Job Market Platform

Our virtual AI- and video-enabled hiring
platform (the “Platform”), which is accessible on our website, Recruiter.com, provides access to over 28,000 small
and independent recruiters. The Platform enables our clients, both employers and recruiters, to access the scalable on-demand sourcing
power of an extensive network of independent recruiters, with the account management and personalized talent delivery of a full-service
recruitment services firm. The Platform can be used by employers on a stand-alone basis or can be integrated with platforms operated
by vendor management services (“VMS”), managed service providers (“MSP”) or payroll solutions providers
to import open jobs into the Platform. Employers may use the Platform to enter job descriptions and learn about qualified applicants,
while independent recruiters may submit their candidates, track the status of those candidates, and view statistics associated
with the hiring process, such as number of applicants, interviews, and status of a particular candidate.

Benefits to Independent Recruiters

Overview

In this uncertain time, small and independent
recruiters are more important than ever. They have the agility and geographical range to respond quickly to the rapidly changing
needs of employers across the country. Recruiter.com empowers these front-line professionals by connecting them to top employers
in multiple sectors, particularly in the industries that need talent right now: healthcare, logistics, telecommunications, and
financial services, among others.

Specific Benefits

Benefits to Employer Clients

Overview

We believe we are among the world’s
largest, most agile network of 28,000 small and independent recruiters, distributed worldwide, and armed with leading-edge technology.
Enterprises can leverage our network of over 26,000 recruiters to tap into existing talent pools and fill open roles immediately.

Long, expensive hiring processes are never worthwhile —
especially not during times of economic upheaval. Our marketplace platform’s scalability allows employers to quickly tune
recruiting activity up or down as needed, which is critical as organizations respond to a dynamic and volatile talent market.

Recruiter.com differentiates itself with
its “three uniques” of people, platform, and power. Our people are recruiting experts, cited and published thought
leaders within recruitment and staffing. Our software platform, with proprietary AI technology (and video technology in Q4 2020),
is key to our distributed, virtual talent engagement process. Finally, our broad distribution, with one of the largest network
of recruiters and millions of social media followers, helps us draw from a diverse and expansive audience. Our people, platform,
and power help us recruit talent faster for employers across the country.

Specific Benefits

Our Strengths

Our Growth Strategy

We seek to unlock the full potential of
our brand by executing its strategic plans, which include organic growth, opportunistic acquisitions, and making use of the capital
markets provided by the public market. In short, we look to realize the potential of our market position.

Overall Market Position Potential

Companies in the recruiting technology
space, such as LinkedIn and Indeed.com, have achieved “unicorn” status as billion-dollar companies. Management believes
that our full potential could lead to our achieving a much larger market position and presence, as Recruiter.com is a defining
brand for the profession of recruiters. Recruiting as a business generates over $125 billion in revenue, therefore management believes
there to be a very large addressable market and opportunities for growth.

Our combination of innovative candidate-matching
technology, a broad network of specialized recruiting professionals, and curated talent communities enable a traditionally service-heavy
industry to be scalable in an entirely new way. The traditional recruitment and staffing industry is dominated by industry roll-ups
in the public markets. We believe our brand and platform position us to capitalize on M&A opportunities, enabling further overall
growth and consolidation.

Strategy

Recruiter.com intends to grow its business
by focusing efforts on the following five main areas:

1) Grow Our Community:

2) Build Business Model Innovations:

3) Monetize the Businesses and Candidates Seeking to Access
the Community and Platform:

We intend to not only develop new clients
for all of our services, but also expand relationships with our existing clients and increase their spending on our platform by
investing in building new products and features.

4) Acquire Complementary Assets and Businesses:

The Company seeks opportunities to acquire
complementary businesses and personnel within the recruitment and staffing sector, primarily to expand the overall number of employers
using our Platform to source talented employees and contractors.

5) Approach the Future with Clarity and Vision:

Technical Vision Strategy – Towards Autonomous Recruiting

The job market and broader economy itself
are evolving to adapt to automation, technology adoption, disruption, and, more recently, machine learning. McKinsey’s Future
of Work in America report, states: “What lies ahead is not a sudden robot takeover but a period of ongoing, and perhaps accelerated,
change in how work is organized and the mix of jobs in the economy. Even as some jobs decline, the US economy will continue to
create others — and technologies themselves will give rise to new occupations. All workers will need to adapt as machines
take over routine and some physical tasks and as demand grows for work involving socio-emotional, creative, technological, and
higher cognitive skills.”

As in many professions, recruiting itself
is both threatened and positively enabled by technology. As a platform company, we are optimistic about our positioning and ability
to not only adapt to, but to lead some of these transformations. Through our marketplace and network, we are gathering data intelligence
while we improve our work processing, enabling a virtuous cycle of systemic and profitable improvements. Specifically, as our artificial
intelligence tools get better, our community of recruiters strengthens their ability to deliver talent by leveraging these tools.
Additionally, the community’s work output informs our systems, and, over time, this helps tune and develop our approach to
further intelligent automation.

We are building our overall technology
platform toward a vision of efficient, near-autonomous recruiting. That said, recruiting — the process of inspiring others
to join a better opportunity and the subsequent judgment of their abilities and fit to do so — is an inherently social practice.
We will attempt to lead in the development of technology that remembers and supports this most critical factor, with the overall
mission of connecting talent to opportunity in a more fluid, rapid, and seamless manner.

Our Clients

Recruiter.com’s unique, scalable,
AI-powered network allows it to meet the hiring needs of a variety of clients, from Fortune 100 enterprises to high-quality startups.
We typically focus on filling highly skilled and senior-level roles in specialized fields, including technology, healthcare, finance,
logistics/transportation, communications, engineering, energy, and many others. Our network’s vast reach is also well-suited
for high-volume hiring projects requiring large numbers of candidates in a short period.

The majority of our revenue (approximately
90{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3}) is generated by providing Recruiting Solutions for employers, consisting of success-based placement fees for fulltime employee
referrals and hourly and project-based fees for professional consulting and staffing. Our clients include Schlumberger, Halliburton
Co., Ford Motor Co., Coca Cola Co., and Bluebeam, Inc. As of December 31, 2020, two customers accounted for more than 10{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} of the
accounts receivable balance, at 32{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3}, and 19{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3}, for a total of 51{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3}. As of December 31, 2019, three customers accounted for more
than 10{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} of the accounts receivable balance, at 19{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3}, 15{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} and 13{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3}, for a total of 47{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3}.

For the year ended December 31, 2020 three
customers accounted for 10{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} of more of total revenue, at 30{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3}, 20{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} and 11{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3}, for a total of 61{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3}. For the year ended December 31,
2019 two customers accounted for 10{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} or more of total revenue, at 32{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} and 17{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3}, for a total of 49{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3}.

The Company’s focus is to increase
and improve its suite of product offerings and solutions to address different needs of potential employers in order to increase
its client base and reduce reliance on the three customers accounting for the large percentage of its revenue.

Our Platform and Technology

Our Platform

Our Job Market Platform, augmented with
AI-powered candidate-sourcing and matching technology, allows our clients to leverage the scalable sourcing power of an extensive
network of independent recruiters, with the account management and personalized talent delivery of a full-service recruitment firm.
Our Platform can be used on a stand-alone basis or can be integrated with platforms operated by third parties or managed service
providers (MSP) to drive client demand. Our Platform is accessible through our website at www.recruiter.com.

Artificial Intelligence and Video

We use AI candidate-sourcing and matching
technology to improve the functionality and effectiveness of our solutions. This technology helps match job descriptions to candidate
resumes to find the best potential matches, which are then provided to the user. We license candidate-matching software from third
parties, including Genesys, which was recently rebranded “Opptly,” and Censia. The initial term of our license agreement
with Genesys, which was executed in connection with our asset purchase agreement with Genesys, expires on May 31, 2021, and Genesys
or Recruiter.com can choose not to renew the license for successive one-year terms after that. Our license agreement with Censia
may be terminated either by Censia or us at any time with a 180-day prior written notice. We contracted MyInterview to build a
video hiring platform through a license and services agreement, with support and resourcing for the product for a term of three
(3) years from the March 30, 2020.

Our Technology Infrastructure

Hosting

We currently host our platform at data
centers owned by Databank in Baltimore, MD, which has systems for automated backup storage and retrieval. Our websites, applications,
and infrastructure were designed to support high-volume traffic. Our management has reviewed Databank’s independently audited
“SOC 2® Type 2 Report on Controls Relevant to Security and Availability for Data Center Services” and believes
Databank’s security protocols to be at or exceeding the level of equivalent technology providers.

Personnel

Software development, database management,
remote server administration, quality assurance, and administrative systems access is managed overseas by Recruiter Mauritius Ltd.
under the direction of our Chief Technology Officer, Ashley Saddul, who works in Mauritius along with other technical personnel.
From time to time, the Company also engages technical personnel on an as-needed basis from other locations, including the United
States and India, who are also managed by Ashley Saddul.

Product Development

We continue to invest in product development,
including our SaaS model, which will allow for greater self-service, enhance our platform, improve user experience, develop new
products and features, and further build our infrastructure. Our goal is to create the most extensive and on-demand online marketplace
of recruiters and recruiting technologies, enabling employers to identify and engage with top talent faster than ever before.

Roadmap

The following roadmap outlines Platform
improvements that Recruiter.com intends to launch over the next year. While our overall strategic direction changes little, these
specific projects cannot be guaranteed and often change. Specific projects include:

Additional Specific Growth Plans

Sales and Marketing Strategy

Our sales and marketing strategy is centered
around driving cost-effective awareness of our brand and the benefits of our platform among recruiters and employers of all sizes,
from small businesses to Fortune 500 companies. Most of our new recruiter and employer registrations come from direct navigation
to our website through unpaid search engine results listings, social media, and other content-based, no-cost referrals. We draw
on our robust recruiting and staffing business foundation to build a sales pipeline and grow account relationships.

Network Effect Strategy

The Recruiter.com platform and network
is a form of marketplace, governed by supply and demand. In our business, supply is the availability of in-demand candidate talent,
which is enabled by the specialization and volume of our recruiter community members. Demand consists of the need for hiring services
by employers, which is represented by job postings on our platform.

Supply and demand are inextricably linked,
and we create virtuous cycles of growth in each by increasing one side or the other. Our strategy is to create the largest network
of recruiters in each local market and industry, creating an unprecedented supply of recruiting talent, encompassing every type
of industry, skill, and specialization. This broad availability of supply creates a liquidity network effect, where we can offer
services anywhere to any employer, thus increasing demand potential.

Already, because of our network strategy,
we can offer a highly differentiated, technology-focused solutions to employers, as we can provide a multidisciplinary talent supply.
As an example of our supply diversity, we provide on-demand recruiters to a growth-stage startup, nursing talent to an employer
in California, and call center personnel to an employer in Texas. For other businesses, we offer standalone technology
on a subscription basis. Over time, we expect this network effect will lead to a margin advantage as compared to our competitors,
which tend to scale supply through physical office footprints and acquisitions alone. 

Sales Strategy

Most of our sales opportunities are derived
from Internet marketing and content strategies, which generate interest and traffic from search engines, such as but not limited
to Google, which index our website content. Word of mouth, customer and user referrals, and general brand recall and recognition
also generate a significant number of visits to our website. Visitors to our website then express interest and contact the company
through standard electronic forms on our website. We employ Account Managers who follow up with these leads and perform inbound
or inside sales functions to develop quality relationships with our customers. As much as possible, we rely on automated contract
solutions to engage with our clients seamlessly. Our sales strategy includes the hiring of both internal and external sales and
sales management personnel to conduct our sales relationships. As we expand our solution offerings, we increasingly cross-sell
across our on-demand recruiting technology and solutions.

We intend to employ several strategic methods
to attract the best sales talent, including by offering attractive commission splits, bonuses, technology capabilities, and lead
generation. These factors, in addition to the benefits of our Recruiter.com brand, should facilitate the recruitment of highly
qualified talent. Also, we look for ways to partner with leading recruiting firms and successful independent recruiting salespeople,
allowing them to sell under the Recruiter.com brand to accelerate our organic growth significantly.

Partnerships

Recruiter.com has forged relationships
with many firms in the recruiting, HR, and payroll space. Partnerships constitute an essential component of our sales and marketing
strategy, as these partnerships may stimulate sales demand for our hiring solutions, including success-based recruiting, on-demand
offerings, and, in the future, video screening services. We pursue strategic alliances with employer service providers for joint
marketing and cross-selling activities, and we seek platform integrations with strategic partners to generate client demand.

Examples of partnerships include:

Public Relations

For PR and marketing purposes, Recruiter.com
relies mostly on the continued development of our thought leadership content. Recruiter Index^®, our proprietary
analysis that pinpoints recruiting trends and forecasts business growth, will likely form the bedrock of our thought leadership
strategy.

No one understands the talent market like
the recruiters, HR professionals, and talent acquisition experts working on the front lines. At Recruiter.com, we have the unique
ability to survey our vast network of independent recruiting and talent acquisition specialists to uncover job market trends. Given
the Recruiter Index’s ^® consistent media appearances over the past nine months, including CNBC, there appears
to be strong demand for leading indicators of the labor market.

Community Management

The Company considers our community management
an essential part of our revenue generation strategy, as active engagement of our network leads to the further output of successful
candidate matches. The principles of our approach to community management include:

Our Community Managers:

Competition

The market for online staffing and recruitment
services is highly competitive, fragmented, and undergoing rapid changes following increasing demand, technological advancements,
and shifting needs. We compete with several online and offline platforms and services, including but not limited to, the following:

We compete based on several factors, including,
among other things: size and engagement of user base, brand awareness and reputation, relationships with third-party partners,
and pricing. We differentiate ourselves through what we call our “three uniques:” people, power, and platform. We pride
ourselves on:

These “three uniques” form
our competitive “moat,” which management believes would be highly challenging for any competitor to replicate.

Intellectual Property

The protection of our intellectual property
is an essential aspect of our business. We own our domain names and trademarks relating to our website’s design and content,
including our brand name and various logos and slogans. We rely upon a combination of trademarks, trade secrets, copyrights, confidentiality
procedures, contractual commitments, and other legal rights to establish and protect our intellectual property. We generally enter
into confidentiality agreements and invention or work product assignment agreements with our employees and consultants to control
access to and clarify ownership of our software, documentation, and other proprietary information.

As of February 20, 2021, we held six registered
trademarks in the United States. Trademarks include the terms “Recruiter Hire,” “Recruiter Index,” “Recruiter
Direct,” “VocaWorks,” “Scouted,” “ScoutedU.”

We consider our brand,
“Recruiter.com,” as an essential and valuable asset, and part of its intellectual property. Russell Racine of
Cranfill Sumner & Hartzog LLP wrote on JDSupra, “Recently the Supreme Court
affirmed registration on the principal register for what appeared to be a generic term. In the United States Patent &
Trademark Office v. Booking.com B. V., 140 S. Ct. 2298 (2020), the Court affirmed registration of a trademark that used a
generic term followed by the addition of the top-level domain moniker ‘.com’ to the end of the mark.” Based on this
action, Recruiter.com has filed an intent-to-use application and application for inclusion in the Supplemental Registry for
the generic domain and brand of “Recruiter.com.” The Company cannot be assured of being granted this
trademark.

Government Regulation

We are subject to a number of US federal
and state and foreign laws and regulations that apply to internet companies and businesses that operate online marketplaces connecting
businesses with recruiters. These laws and regulations may involve worker classification, employment, data protection, privacy,
online payment services, content regulation, intellectual property, taxation, consumer protection, background checks, payment services,
money transmitter regulations, anti-corruption, anti-money laundering, and sanctions laws, or other matters. Many of the rules
and regulations that are or may apply to our business are still evolving and being tested in courts and could be interpreted in
ways that could adversely impact our business. Also, the application and interpretation of these laws and regulations are often
uncertain, particularly in the industry in which we operate.

Additionally, our technology platform and
the platform user data it uses, collects, or processes to run our business is an integral part of our business model and, as a
result, our compliance with laws dealing with the use, collection, and processing of personal data is part of our strategy to improve
platform user experience and build trust.

Regulators around the world have adopted,
or proposed requirements regarding the collection, use, transfer, security, storage, destruction, and other processing of personally
identifiable information and other data relating to individuals, and these laws are increasing in number, enforcement, fines, and
other penalties. Two such governmental regulations that carry implications for our platform are the GDPR and the CCPA.

The GDPR went into effect in May 2018,
implementing more stringent requirements in relation to companies’ use of personal data relating to all EU individuals (“data
subjects”). Under the GDPR, the expanded definition of personal data includes information such as name, identification number,
email address, location data, online identifiers such as internet protocol addresses and cookie identifiers, or any other type
of information that can identify a living individual. The GDPR imposes a number of new requirements, which include: a valid ground
for processing each instance of personal data; higher standards for organizations to demonstrate that they have obtained valid
consent or have another legal basis in place to justify their data processing activities; providing expanded information about
how data subjects’ personal data is or will be used; carrying out data protection impact assessments for operations which
present specific risks to individuals due to the nature or scope of the processing operation; an obligation to appoint data protection
officers in certain circumstances; new rights for individuals to be “forgotten” and rights to data portability, as
well as enhanced current rights; the principle of accountability and demonstrating compliance through policies, procedures, training,
and audit; profiling restrictions; and a new mandatory data breach reporting regime.

In the United States, California recently
adopted the CCPA, which came into effect in January 2020. Similar in certain respects to the GDPR, the CCPA establishes a new privacy
framework for covered businesses, including an expanded definition of “personal information”; new data privacy rights
for California residents, requiring covered businesses to provide further disclosure to consumers and affording consumers the right
to opt-out of individual sales of personal information; special rules on the collection of consumer data from minors; and a potentially
severe statutory damages framework and private rights of action for CCPA violations and failure to implement reasonable security
procedures and practices.

Facilities

Our corporate headquarters are located
in Houston, Texas, where we occupy facilities totaling approximately 5,480 square feet under a lease that expires in November 2022
with a related party. We do not currently have other leased offices but do operate from time to time in flexible office space,
such as WeWork offices.

We believe that our facilities are adequate
to meet our needs for the immediate future, and that, should it be needed, suitable additional space will be available to accommodate
any such expansion of our operations.

Legal Proceedings

As of the date of this filing, there are no material pending
legal or governmental proceedings relating to our Company or properties to which we are a party, and, to our knowledge, there are
no material proceedings to which any of our directors, executive officers, or affiliates are a party adverse to us or which have
a material interest adverse to us.

Employees

As of March 5, 2020, the Company employed
270 employees in 19 states.

Culture and Team

Most of our staff members have many years
of experience in online recruiting and technology. We’re inspired every day by our mission to connect people better to create
terrific job matches. Our people are musicians, programmers, writers, speakers, mathematicians, gardeners, parachuters, runners,
hikers, sports fanatics, backyard chicken farmers, and photographers. We are a family-first company, with many hard-working parents
raising the next generation of Recruiter.com interns.

As we build the next generation of recruiting
technology, we look for people who are passionate about connecting people and helping to develop better work experiences and career
opportunities for others. We pride ourselves on being a team on a mission, with big goals and even bigger dreams for the company.
We work virtually, with lean operations and an efficient cost model, while staying firmly connected through chat and video.

We are a place to make an impact. We pay
little attention to job titles and much more attention to results – who’s thinking creatively and making positive contributions
daily. At all times, we try to effectively tie things like compensation to direct contribution and foster an environment of inclusion
and fair equity. To summarize, we’re specialists in recruiting and know what it takes to be an employer of choice and a great
place to work. We strive to make our work enjoyable, rewarding, and full of growth opportunities for our staff. 

Diversity

We connect people from an extraordinarily
diverse range of backgrounds and locations. We strive to make a product that makes a difference, and one that helps build a just,
equitable future for us all. We are committed to being an equal opportunity employer ourselves, and we only work with clients who
respect both the law and spirit of equal opportunity employment. Further, we believe that, as we grow as a company, our success
will be predicated on drawing from and amplifying a diverse range of voices, both internally and externally.

We are fortunate to have a vibrant and
innovative staff from diverse backgrounds. We hold ourselves to a high standard of equity and inclusion. Currently, we have people
of color, women, and members of the LGBTQ+ community in senior roles at the company, including executive leadership and on our
Board of Directors (the “Board”).

We welcome people from all backgrounds
to apply to our internal careers and our client roles. We are also very interested in developing new practices to increase fairness
in our hiring processes, including quantitative assessments, bias training, and reducing bias from new virtual tools that we introduce,
such as video screening. We regularly and routinely seek out ways to improve our recruiting practices and expand the breadth and
depth of our network of recruiters.

Corporate Information

Our principal executive offices are located at 100 Waugh Dr.,
Suite 300, Houston, Texas. Our telephone number is (855) 931-1500. Our website address is www.recruiter.com. The information contained
on, or that can be accessed through, our site is not a part of this filing. Investors should not rely on any such information in
deciding whether to purchase our securities.

You should consider carefully the following
risk factors, together with all of the other information included or incorporated in this Annual Report. Each of these risk factors,
either alone or taken together, could adversely affect our business, financial condition and results of operations, and adversely
affect the value of an investment in our Common Stock. There may be additional risks that we do not know of or that we believe
are immaterial that could also impair our business and financial condition.

Risks Related to Our Business and
Industry

There is substantial doubt regarding
our ability to continue as a going concern absent obtaining adequate new debt or equity financing and achieving sufficient sales
levels.

We anticipate that we will continue to
lose money for the foreseeable future. Our continued existence is dependent upon raising sufficient funds from this offering and
generating sufficient working capital from our operations. Because of our history of losses, and net cash used in our operations
we may have to continue to reduce our expenditures without receipt of sufficient proceeds from this offering or improvements in
our cash flow from operations. Working capital limitations continue to impinge on our day-to-day operations thus contributing to
continued operating losses. If we are unable to raise sufficient funds in this offering, we may not be able to meet our obligations
as they come due, raising substantial doubts as to our ability to continue as a going concern. Any such inability to continue as
a going concern may result in our stockholders losing their entire investment. There is no guarantee that we will raise sufficient
funds in this offering.

The Company’s management has determined that there is
substantial doubt about the Company’s ability to continue as a going concern and the report of our independent registered
public accounting firm on our consolidated financial statements for the years ended December 31, 2020 and 2019 included an explanatory
paragraph with respect to the foregoing. Our ability to continue as a going concern is dependent upon our ability to raise additional
capital and implement our business plan. This determination was based on the following factors: (i) the Company has a working capital
deficit as of December 31, 2020, used cash in operations of approximately $2.5 million in 2020, and the Company’s available
cash as of the date of this filing will not be sufficient to fund its anticipated level of operations for the next 12 months; (ii)
the Company will require additional financing for the fiscal year ending December 31, 2021 to continue at its expected level of
operations; and (iii) if the Company fails to obtain the needed capital, it will be forced to delay, scale back, or eliminate some
or all of its development activities or perhaps cease operations. In the opinion of management, these factors, among others, raise
substantial doubt about the ability of the Company to continue as a going concern as of the date of the end of the period covered
by this report and for one year from the issuance of the consolidated financial statements.

The Company’s business depends
on a strong reputation and anything that harms its reputation will likely harm its results.

As a provider
of temporary and permanent staffing solutions as well as consultant services, the Company’s reputation is dependent upon
the performance of the employees it places with its clients and the services rendered by its consultants. The Company depends on
its reputation and name recognition to secure engagements and to hire qualified employees and consultants. If the Company’s
clients become dissatisfied with the performance of those employees or consultants or if any of those employees or consultants
engage in or are believed to have engaged in conduct that is harmful to the Company’s clients, the Company’s ability
to maintain or expand its client base may be harmed. Any of the foregoing is likely to materially adversely affect the Company.

The Company
may be unable to find sufficient candidates for its staffing business.

The Company’s
staffing services business consists of the placement of individuals seeking employment. There can be no assurance that candidates
for employment will continue to seek employment through the Company. Candidates generally seek temporary or full-time positions
through multiple sources, including the Company and its competitors. Prior to COVID-19, unemployment in the United States has been
low in the past couple of years but has sharply increased due to the effects of the COVID-19 pandemic. The availability of qualified
talent may change or become more scarce, depending on macro-economic conditions outside of the Company’s control. If finding
sufficient eligible candidates to meet employers’ demands becomes more challenging due to falling unemployment rates or other
talent availability issues, the Company may experience a shortage of qualified candidates. Any shortage of candidates could materially
adversely affect the Company.

The Company
may incur potential liability to employees and clients.

The Company’s
consulting and staffing business entails employing individuals on a temporary basis and placing such individuals in clients’
workplaces. The Company does not have the ability to control the workplace environment. As the employer of record of its temporary
employees, the Company incurs a risk of liability to its temporary employees for various workplace events, including claims of
physical injury, discrimination, harassment, or failure to protect confidential personal information. While such claims have not
historically had a material adverse effect upon the Company, there can be no assurance that such claims in the future will not
result in adverse publicity or have a material adverse effect upon the Company. The Company also incurs a risk of liability to
its employer clients resulting from allegations of errors, omissions or theft by its temporary employees, or allegations of misuse
of client confidential information. In many cases, the Company has agreed to indemnify its clients in respect of these types
of claims. The Company maintains insurance with respect to many of such claims. While such claims have not historically had a material
adverse effect upon the Company, there can be no assurance that the Company will continue to be able to obtain insurance at a cost
that does not have a material adverse effect upon the Company or that such claims will be covered by such available insurance.

We may require
additional capital to fund our business and support our growth, and our inability to generate and obtain such capital on acceptable
terms, or at all, could harm our business, operating results, financial condition and prospects.

We intend to continue
to make substantial investments to fund our business and support our growth. In addition, we may require additional funds to respond
to business challenges, including the need to develop new features or enhance our solutions, improve our operating infrastructure,
or acquire or develop complementary businesses and technologies. As a result, in addition to the revenues we generate from our
business and the proceeds from this offering, we may need to engage in additional equity or debt financings to provide the funds
required for these and other business endeavors. If we raise additional funds through future issuances of equity or convertible
debt securities, our existing stockholders could suffer significant dilution, and any new equity securities we issue could have
rights, preferences, and privileges superior to those of holders of our Common Stock. Any debt financing that we may secure in the
future could involve restrictive covenants relating to our capital raising activities and other financial and operational matters,
which may make it more difficult for us to obtain additional capital and to pursue business opportunities, including potential
acquisitions. We may not be able to obtain such additional financing on terms favorable to us, if at all. If we are unable to obtain
adequate financing or financing on terms satisfactory to us when we require it, our ability to continue to support our business
growth and to respond to business challenges could be significantly impaired, and our business may be adversely impacted. In addition,
our inability to generate or obtain the financial resources needed may require us to delay, scale back, or eliminate some or all
of our operations, which may have a significant adverse impact on our business, operating results and financial condition.

Because we have a history of net losses,
we may never achieve or sustain profitability or positive cash flow from operations.

We have incurred net losses in each fiscal year since our inception,
including net losses of approximately $17 million for the year ended December 31, 2020 and $12.0 million for the year ended December
31, 2019. As of December 31, 2020, we had an accumulated deficit of approximately $34.5 million. We expect to continue to incur
substantial expenditures to develop and market our services and could continue to incur losses and negative operating cash flow
for the foreseeable future. We may never achieve profitability or positive cash flow in the future, and even if we do, we may not
be able to continue being profitable. Any failure to achieve and maintain profitability would continue to have an adverse effect
on our stockholders’ deficit and working capital and could result in a decline in our stock price or cause us to cease operations.

Because we have a limited operating
history under our current platform, it is difficult to evaluate our business and future prospects and thus increases the risks
associated with investment in our securities.

We have operated our current platform since
April 16, 2016, when we acquired the Platform, where it was then put into a multi-year process of further development, integration,
and branding. As a result, our platform and business model have not been fully proven, and we have only a limited operating history
on which to evaluate our business and future prospects. We have encountered, and will continue to encounter, risks and difficulties
frequently experienced by growing companies in rapidly changing industries, including our ability to achieve market acceptance
of our platform and attract, retain and incentivize recruiters on our platform, as well as respond to competition and plan for
and scale our operations to address future growth. We may not be successful in addressing these and other challenges we may face
in the future, and our business and future prospects may be materially and adversely affected if we do not manage these and other
risks successfully. Given our limited operating history, we may be unable to effectively implement our business plan which could
materially harm our business or cause us to scale down or cease our operations.

If we fail
to completely successfully integrate the assets we acquired, we may not fully realize the anticipated benefits from the acquisition,
and our results of operations would be materially and adversely affected.

On January 31, 2021 we acquired certain assets and the business
from Scouted and anticipate acquiring additional assets and businesses in future purchases, including OneWire. Our failure to successfully
integrate the assets we acquire may be more difficult, costly or time-consuming than we anticipate, or we may not otherwise realize
any of the anticipated benefits of this acquisition. Any of the foregoing could adversely affect our future results of operations
or could cause our stock price to decline.

If our due
diligence process proves not robust enough, we may acquire non-performing assets, people, and companies.

Recruiter.com
management is opportunistic in its approach to mergers and acquisitions. The Company is actively looking to grow its base of clients,
intellectual property, assets and suite of recruitment technology solutions. If the Company’s processes fail to identify
risks and weaknesses of companies it either acquires or purchases assets from, the Company may be harmed or have difficulties recouping
its investments. Additionally, the Company may be unable to effectively integrate such assets into its business.

Our future growth depends on our ability
to attract, retain and incentivize a community of recruiters, and the loss of existing recruiters, or failure to attract new ones,
could adversely impact our business and future prospects.

The size of our community of
employers on our platform is critical to our success. Our ability to achieve profitability in the future will depend, in
large part, on our ability to attract new users to, and retain existing users on, our platform. Recruiters on our Platform
can generally decide to cease using our platform at any time. While we have experienced rapid growth in the number of
recruiters on our platform in recent months, with numbers rising from 27,011 on September 30, 2020 to over 28,000 in January
2021, this growth may not continue at the same pace in the future or at all. In addition, it is possible that the ongoing
effects of COVID-19 may have a deleterious effect on our user growth in the future. Achieving growth in our community of
users may require us to engage in increasingly sophisticated and costly sales and marketing efforts that may not result in
additional users. We may also need to modify our pricing model to attract and retain such users. If we fail to attract new
users or fail to maintain or expand existing relationships in a cost-effective manner, our business and future prospects
would be materially and adversely impacted.

If we are unable to respond to technological
advancements and other changes in our industry by developing and releasing new services, or improving our existing services, in
a timely and cost-effective manner or at all, our business could be materially and adversely affected.

Our industry is characterized by rapid
technological change, frequent new service launches, changing user demands, and evolving industry standards. The introduction of
new services based on technological advancements can quickly render existing services obsolete. We will need to expend substantial
resources on researching and developing new services and enhancing our platform by incorporating additional features, improving
functionality, and adding other improvements to meet our users’ evolving demands. We may not be successful in developing,
marketing, and delivering in a timely and cost-effective manner enhancements or new features to our platform or any new services
that respond to continued changes in the market. Furthermore, any enhancements or new features to our platform or any new services
may contain errors or defects and may not achieve the broad market acceptance necessary to generate sufficient revenue. Moreover,
even if we introduce new services, we may experience a decline in revenue from our existing services that is not offset by revenue
from the new services.

If we experience errors, defects, or
disruptions in our platform it could damage our reputation, which could in turn materially and adversely impact our operating results
and growth prospects.

The performance and reliability of our
platform is critical to our reputation and ability to attract and retain recruiters and clients. Any system error or failure, or
other performance problems with our platform could harm our brand and reputation and may damage the businesses of users. Additionally,
our platform requires frequent updates, which may contain undetected errors when first introduced or released. Any errors, defects,
disruptions in service, or other performance or stability problems with our platform could result in negative publicity, loss of
or delay in market acceptance of our platform, loss of competitive position, delay of payment to us or recruiters, or claims by
users for losses sustained by them, which could adversely impact our brand and reputation, operating results and future prospects.

The continued operation of our business
depends on the performance and reliability of Internet, mobile, and other infrastructures that are not under our control.

Our business depends on the performance
and reliability of Internet, mobile, and other infrastructures that are not under our control. Disruptions in such infrastructures,
including as the result of power outages, telecommunications delay or failure, security breach, or computer virus, as well as failure
by telecommunications network operators to provide us with the bandwidth we need to provide our products and offerings, could cause
delays or interruptions to our products, offerings, and platform. Any of these events could damage our reputation, resulting in
fewer recruiters actively using our platform, disrupt our operations, and subject us to liability, which could adversely affect
our business, financial condition, and operating results.

We rely on third parties to host our
platform, and any disruption of service from such third parties or material change to, or termination of, our arrangement with
them could adversely affect our business.

We use third-party cloud infrastructure
services providers and co-located data centers in the United States and abroad to host our platform. Software development, remote
server administration, quality assurance, and administrative access is managed overseas by Recruiter Mauritius Ltd. under the direction
of our Chief Technology Officer, Ashley Saddul. We do not control the physical operation of any of the data centers we use. These
facilities are vulnerable to damage or interruption from earthquakes, hurricanes, floods, fires, cyber security attacks, terrorist
attacks, power losses, telecommunications failures, and similar events. The occurrence of a natural disaster or an act of terrorism,
a decision to close the facilities without adequate notice, or other unanticipated problems could result in lengthy interruptions
to our platform. The facilities also could be subject to break-ins, computer viruses, sabotage, intentional acts of violence, and
other misconduct. We may not carry sufficient business interruption insurance to compensate us for losses that may occur as a result
of any events that cause interruptions in our service. We may not be able to maintain or renew our agreements or arrangements with
these third-party service providers on commercially reasonable terms, or at all. If we are unable to renew our agreements on commercially
reasonable terms, our agreements are terminated, or we add additional infrastructure providers, we may experience costs or downtime
in connection with the transfer to, or the addition of, new data center providers. If these providers increase the cost of their
services, we may have to increase the fees to use our platform, and our operating results may be adversely impacted.

Because we have arrangements with related
parties affecting a significant part of our operations, such arrangements may not reflect terms that would otherwise be available
from unaffiliated third parties.

We rely on arrangements with related parties for support of
our operations, including technical support, rent, back-office and accounting, and may engage in additional related party transactions
in the future. For example, we currently rely on a related party provider of information technology and computer services located
in Mauritius, an island country located off the eastern coast of Africa, for software development and maintenance related to our
website and platform. Our Chief Technology Officer is an employee of this service provider. Additionally, Icon Information Consultants,
LP (“Icon”), a significant stockholder of the Company, performs much of the back office and accounting functions for
Recruiting Solutions, the subsidiary through which we operate our staffing business. See “Certain Relationships and Related
Person Transactions” for further details. Although we believe that the terms of our arrangements with related parties are
reasonable and generally consistent with market standards, such terms do not necessarily reflect terms that we or such related
parties would agree to in arms-length negotiations with an independent third party. Furthermore, potential conflicts of interest
can exist if a related party is presented with an issue that may have conflicting implications for the Company and such related
party. If a dispute arises in connection with any of these arrangements, which is not resolved to the satisfaction of the Company,
our business could be materially and adversely affected.

The COVID-19 pandemic has resulted in
a significant downturn in the global and United States economies and accordingly a decreased demand for recruitment and staffing
services, which could have a material adverse effect on our business, financial condition and results of operations.

In late 2019, an outbreak of COVID-19 was
first reported in Wuhan, China. In March 2020, the World Health Organization declared the COVID-19 outbreak a global pandemic.
The COVID-19 pandemic has resulted in the implementation of significant governmental measures, including lockdowns, closures, quarantines
and travel bans around the world aimed at controlling the spread of the virus. Businesses are also taking precautions, including
requiring employees to work remotely or take leave, imposing travel restrictions and temporarily closing their facilities. Initial
unemployment numbers have spiked. Uncertainties regarding the impact of COVID-19 on economic conditions are likely to result in
sustained market turmoil and reduced demand for employees, which in its turn has had a negative impact on the recruitment and staffing
industry. According to a report from CEOToday, the U.S. staffing industry, which previously boasted a market size of $152 billion
has now fallen to roughly $119 billion since the COVID-19 outbreak; bringing it down to its lowest level since 2013. This represents
a 21{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} decrease from 2019.

To date the economic impact of COVID-19 has resulted in certain
reductions in the Company’s business and the Company has devoted efforts to shifting its focus in areas of hiring. As of
the date of this filing, to the Company’s knowledge, no customer of the Company has gone out of business nor have any counterparties
attempted to assert the existence of a force majeure clause, which excuses contractual performance. Because we depend on continued
demand for recruitment services, a downturn in the recruitment and staffing industry would have a material adverse impact on our
business and results of operations.

We also depend on raising additional debt or equity capital
to stay operational. The economic impact of COVID-19 may make it more difficult for us to raise additional capital when needed.
In April 2020, we were informed by a factoring company that we had used to supplement our liquidity that it would no longer be
able to advance funds to us against our future accounts receivable due to the effect of the COVID-19 pandemic. The terms of any
financing, if we are able to complete one, will likely not be favorable to us. If we are unable to raise additional capital, we
may not be able to meet our obligations as they come due, raising substantial doubt as to our ability to continue as a going concern.

If internet search engines’ methodologies
or other channels that we utilize to direct traffic to our website are modified, or our search result page rankings otherwise decline,
it could negatively affect our future growth.

We depend in part on various internet search
engines, such as Google, Yahoo, Bing and others, as well as other internet channels and referral partners to direct traffic to
our website. Our ability to maintain the number of visitors directed to our website is not entirely within our control. For example,
our competitors’ search engine optimization and other efforts may result in their websites receiving a higher search result
page ranking than ours, internet search engines or other channels that we utilize to direct traffic to our website could revise
their methodologies in a manner that adversely impacts traffic to our website, or we may make changes to our website that adversely
impact our search engine optimization rankings and traffic. As a result, links to our website may not be prominent enough to drive
sufficient traffic to our website, and we may not be able to influence the results. Any of these changes could have an adverse
impact on our operating results and future growth.

If we or our third-party partners experience
a security breach resulting in unauthorized access to our clients’ or recruiters’ data, our data, or our platform,
networks, or other systems, our reputation would suffer, demand for our services may be reduced, our operations may be disrupted,
we may incur significant legal liabilities, and our business could be materially and adversely affected.

Our business involves storage, processing,
and transmission of our clients’ and recruiters’ proprietary, confidential, and personal information as well as the
use of third-party partners who store, process, and transmit such proprietary, confidential, and personal information. We also
maintain certain other proprietary and confidential information relating to our business and personal information of our employees.
Any security breach or incident affecting us or third parties on which we rely, including resulting from computer viruses, malware,
physical or electronic break-ins, or weakness resulting from intentional or unintentional service provider or employee actions,
could result in unauthorized access to, misuse of, or unauthorized acquisition of our or our clients’ or recruiters’
data, the loss, corruption, or alteration of this data, interruptions in our operations, or damage to our computers or systems
or those of our clients or recruiters. If an actual or perceived security breach affecting us or our third-party partners occurs,
public perception of the effectiveness of our security measures would suffer, and result in attrition of recruiters on our platform
or loss of clients. Any compromise of our or our third-party partners’ security could result in a violation of applicable
privacy and other laws, regulatory or other governmental investigations, enforcement actions, and legal and financial exposure,
including potential contractual liability. Any such compromise could also result in damage to our reputation and a loss of confidence
in our security measures. Any of these effects could adversely impact our business, operating results and growth prospects.

Our platform contains open-source software
components, and failure to comply with the terms of the underlying licenses could restrict our ability to market or operate our
platform.

Our Company incorporates many types of
open-source software, frameworks and databases, including our Platform, which is currently architected on the Yii platform using
PHP code and MySQL databases. Open-source licenses typically permit the use, modification, and distribution of software in source
code form subject to certain conditions. Some open-source licenses require any person who distributes a modification or derivative
work of such software to make the modified version subject to the same open source license. Accordingly, although we do not believe
that we have used open-source software in a manner that would subject us to this requirement, we may be required to distribute
certain aspects of our platform or make them available in source code form. Further, the interpretation of open-source licenses
is legally complex. If we fail to comply with the terms of an applicable open source software license, we may need to seek licenses
from third parties to continue offering our platform and the terms on which such licenses are available may not be economically
feasible, to re-engineer our platform to remove or replace the open source software, to limit or stop offering our platform if
re-engineering could not be accomplished on a timely or cost-effective basis, to pay monetary damages, or to make available the
source code for aspects of our proprietary technology, any of which could adversely affect our business, operating results, and
financial condition.

In addition, generally there are no warranties,
assurances of title, performance, or non-infringement, or controls on the origin of the software provided for the open-source software.
There is typically no support available for open-source software, and no guarantee of periodic updates to address security risks
or continued development and maintenance.

Our future growth depends in part on
our ability to form new and maintain existing strategic partnerships with third party solution providers and continued performance
of such solution providers under the terms of our strategic partnerships with them.

As part of our growth strategy for the
Company and, in particular, its enterprise solution offering, we establish and maintain strategic partnerships with large and established
third party solution providers to employers, such as companies specializing in enterprise application software, human resources,
payroll, talent, time management, tax and benefits administration. Our strategic partnerships include among other things, integration
of our platform with those of our strategic partners, joint marketing and commercial alignment, including joint events, and sales
of our services by our partners’ representatives. We may be unable to renew or replace our agreements with such strategic
partners as and when they expire on comparable terms, or at all. Moreover, the parties with which we have strategic relationships
may fail to devote the resources necessary to expand our reach and increase our distribution. In addition, our agreements with
our strategic partners generally do not contain any covenants that would limit competing arrangements. Some of our strategic partners
offer, or could in the future offer, competing products and services or have similar strategic relationships with our competitors,
and may choose to favor our competitors’ solutions over ours. If we are unsuccessful in establishing or maintaining our relationships
with third parties, our growth prospects could be impaired, and our operating results may be adversely impacted. Even if we are
successful in establishing and maintaining these strategic relationships with third parties, they may not result in the growth
of our client base or increased revenue.

We rely in part on certain software
that we license from related and third parties as part of our service offerings, and if we were to lose the ability to use such
software our business and operating results would be materially and adversely affected.

We license certain candidate matching software from Genesys,
which was recently rebranded “Opptly,” video screening technology from MyInterview, AI-candidate matching software
from Censia, as well as other popular, commercially available third party recruiting, communications, and marketing related software
systems, such as LinkedIn and Hubspot, much of which is integral to our systems and our business. The license agreement, which
was included as part of the asset purchase agreement with Genesys dated March 31, 2019, which transferred the clients, but not
the technology of Genesys to the Company, governing the use by us of the Genesys software is perpetual and renewed monthly, which
may be terminated by either party with 15 days written notice prior to the closing of the current term which expires May 31, 2021
or at any time upon a breach by either party. The license agreement governing the use by us of the Censia platform is perpetual,
but may be terminated by either party with 180 days of notice. If any of these relationships were terminated or if any of these
parties were to cease doing business or cease to support the applications we currently utilize, we may be forced to expend significant
time and resources to replace the licensed software. Further, the necessary replacements may not be available on a timely basis
on favorable terms, or at all. If we were to lose the ability to use this software our business and operating results would be
materially and adversely affected.

Because we rely on a small number of
customers for a substantial portion of our revenue, the loss of any of these customers would have a material adverse effect on
our operating results and cash flows.

We derive our revenue from a limited number of customers. As
of December 31, 2020, two customers accounted for more than 10{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} of the accounts receivable balance, at 32{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} and 19{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3}, for a total
of 51{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3}. As of December 31, 2019, three customers accounted for more than 10{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} of the accounts receivable balance, at 19{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3}, 15{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} and
13{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3}, for a total of 47{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3}.

Any termination of a business relationship
with, or a significant sustained reduction in business from, one or more of these customers could have a material adverse effect
on our operating results and cash flows.

Failure to protect our intellectual
property could adversely affect our business.

Our success depends in large part on our
proprietary technology and data, including our trade secrets, software code, the content of our website, workflows, proprietary
databases, registered domain names, registered and unregistered trademarks, trademark applications, copyrights, and inventions
(whether or not patentable). In order to protect our intellectual property, we rely on a combination of copyright, trademark, and
trade secrets, as well as confidentiality provisions and contractual arrangements.

Despite our efforts, third parties may
infringe upon or misappropriate our intellectual property by copying or reverse-engineering information that we regard as proprietary,
including our platform, to create products and services that compete with ours. Further, we may be unable to prevent competitors
from acquiring domain names or trademarks that are similar to, infringe upon, or diminish the value of our domain names, trademarks,
service marks, and other proprietary rights. Moreover, our trade secrets may be compromised by third parties or our employees,
which would cause us to lose the competitive advantage derived from the compromised trade secrets. Additionally, effective intellectual
property protection may not be available to us in every country in which our platform currently is or may in the future be available.
Further, we may be unable to detect infringement of our intellectual property rights, and even if we detect such violations and
decide to enforce our intellectual property rights, we may not be successful, and may incur significant expenses, in such efforts.
In addition, any such enforcement efforts may be time-consuming, expensive and may divert management’s attention. Because
we rely on our Chief Technology Officer and his staff who are based in Mauritius, we face a risk based upon any local conditions
and difficulties we may face in enforcing our intellectual property rights there. Further, such enforcement efforts may result
in a ruling that our intellectual property rights are unenforceable. Any failure to protect or any loss of our intellectual property
may have an adverse effect on our ability to compete and may adversely affect our business, financial condition, and operating
results.

We may become subject to intellectual
property infringement claims and challenges by third parties.

Third parties may claim that certain aspects
of our platform, content, and brand infringe on their intellectual property rights. Any claims or litigation, regardless of merit,
could cause us to incur significant legal expenses and, if successfully asserted, could require us to pay substantial damages or
make ongoing royalty payments, prevent us from offering certain aspects of our platform, comply with other terms that may be unfavorable
to us, or require us to stop using technology that contains the allegedly infringing intellectual property.

Even if intellectual property claims do
not result in litigation or are resolved in our favor, these claims typically involve large legal fees, and the time and resources
necessary to resolve them could divert our management’s attention and adversely affect our business and operating results.
Although the Company takes steps to ensure the validity and security of purchased assets, the purchase of assets or businesses
may give rise to claims of intellectual property infringement.

We may become subject to marketing use,
image, defamation, or representation claims and challenges by third parties.

The Company expects to increase its use
of image- and video-based recruiting technology solutions, which function by the recording and capture of images and videos of
individuals. The Company stores and communicates these images and video to third parties, including the employers that desire to
hire individuals as contractors and employees. In providing the transmission of user-generated content, which includes but is not
limited to images and video, the Company exposes itself to certain litigation risks, including but not limited to the right-to-use,
defamation, marketing-use, representation, and other claims by both employers and individuals.

If we or our clients are perceived to
have violated or are found in violation of, the anti-discrimination laws and regulations as the result of the use of predictive
technologies or external independent recruiters in the recruitment process, it may damage our reputation and have a material adverse
effect on our business and results of operations.

We and our clients may be exposed to potential
claims associated with the use of predictive algorithms and external recruiters in the recruitment process, including claims of
age and gender discrimination. For example, Title VII of the Civil Rights Act of 1964 (“Title VII”) prohibits employers
from limiting employment opportunities based on certain protected characteristics, including race, color, religion, sex, and national
origin. The Age Discrimination in Employment Act of 1967 (the “ADA”) prohibits discrimination based on age. Certain
social media companies, as well as employers purchasing targeted ads from such companies, have recently come under scrutiny for
discriminatory advertising. In September 2019, the U.S. Equal Employment Opportunity Commission (the “EEOC”) ruled
that several employers violated the ADA and Title VII by publicizing job openings on social media through the use of ads that targeted
young men to the detriment of women and older workers. If we or our clients are perceived to have violated or are found in violation
of, Title VII, the ADA, or any other anti-discrimination laws and regulations as the result of the use of predictive technologies
in the recruitment process, it may damage our reputation and have a material adverse effect on our business and results of operations.

If we cannot manage our growth effectively,
our results of operations would be materially and adversely affected.

We have recently experienced significant
growth following the Company’s acquisition and merger of Genesys. More recently, the number of recruiters on our platform
increased from approximately 10,000 recruiters in July 2019 to over approximately 28,000 recruiters in January 2021 and currently
stands at over 28,290 recruiters in March, 2021. Businesses that grow rapidly often have difficulty managing their growth while
maintaining their compliance and quality standards. If we continue to grow as rapidly as we anticipate, we will need to expand
our management by recruiting and employing additional executive and key personnel capable of providing the necessary support. There
can be no assurance that our management, along with our staff, will be able to effectively manage our growth. Our failure to meet
the challenges associated with rapid growth could materially and adversely affect our business and operating results.

If recruiters on our Platform were classified
as employees instead of independent contractors, our business would be materially and adversely affected.

The Company believes that the recruiters
who engage with us on our platform are independent contractors, due to a number of factors, including our inability to control
these recruiters, and the Company’s Terms of Use with our users reflect that understanding. However, if the independent contractor
status of recruiters is challenged, we may not be successful in defending against such challenges in some or all jurisdictions.
Furthermore, the costs associated with defending, settling, or resolving lawsuits relating to the independent contractor status
of recruiters could be material to our business. In September 2019, California enacted a new employee classification law that codified
the 2018 decision by the state’s Supreme Court classifying independent contractors as employees unless they satisfy the following
requirements: (i) are free from the control and direction of the entity relating to the performance of the work; (ii) perform work
outside the usual course of the hiring entity’s business; and (iii) are customarily engaged in an independently established
trade, occupation, or business. We cannot be certain if this ruling in California will impact us.

If a court or an administrative agency
were to determine that the recruiters on our platform must be classified as employees rather than independent contractors, we and/or
our clients would become subject to additional regulatory requirements, including but not limited to tax, wages, and wage and hour
laws and requirements (such as those pertaining to minimum wage and overtime); employee benefits, social security, workers’
compensation and unemployment; discrimination, harassment, and retaliation under civil rights laws; claims under laws pertaining
to unionizing, collective bargaining, and other concerted activity; and other laws and regulations applicable to employers and
employees. Compliance with such laws and regulations would require us to incur significant additional expenses, potentially including
without limitation, expenses associated with the application of wage and hour laws (including minimum wage, overtime, and meal
and rest period requirements), employee benefits, social security contributions, taxes, and penalties. Additionally, any such reclassification
would require us to fundamentally change our business model, and consequently have an adverse effect on our business and financial
condition.

Approximately 52{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} of the recruiters
on our platform are located in jurisdictions outside the United States, which exposes us to risks related to operating abroad.

Even though we currently have a limited physical presence outside
of the United States, recruiters on our platform are located in approximately 162 countries (aside from the US) around the world,
the most prevalent being those recruiters who reside in India, Malaysia, England, and Canada, which subjects us to the risks and
uncertainties associated with doing business internationally. Additionally, users on our platform include recruiters from some
emerging markets where we have limited experience, where challenges can be significantly different from those we have faced in
more developed markets, and where business practices may create greater internal control risks. Because our platform is generally
accessible by users worldwide, one or more jurisdictions may claim that we or recruiters on our platform are required to comply
with the laws of such jurisdictions. Laws outside of the United States regulating the Internet, payments, escrow, privacy, taxation,
terms of service, website accessibility, consumer protection, intellectual property ownership, services intermediaries, labor and
employment, wage and hour, worker classification, background checks, and recruiting and staffing companies, among others, which
could be interpreted to apply to us, are often less favorable to us than those in the United States, giving greater rights to competitors,
users, and other third parties. Compliance with foreign laws and regulations may be more costly than expected, may require us to
change our business practices or restrict our product offerings, and the imposition of any such laws or regulations on us, our
users, or third parties that we or our users utilize to provide or use our services, may adversely impact our revenue and business.
In addition, we may be subject to multiple overlapping legal or regulatory regimes that impose conflicting requirements and enhanced
legal risks.

The risks described above may also make
it more difficult for us to expand our operations internationally. Analysis of, and compliance with, global laws and regulations
may substantially increase our cost of doing business. We may be unable to keep current with changes in laws and regulations as
they develop. Any violations could result in enforcement actions, fines, civil and criminal penalties, damages, interest, costs
and fees (including but not limited to legal fees), injunctions, loss of intellectual property rights, or reputational harm. If
we are unable to comply with these laws and regulations or manage the complexity of global operations and supporting an international
user base successfully, our business, operating results, and financial condition could be adversely affected.

If we are unable to maintain our relationships
with payment and banking partners, our business could be materially and adversely affected.

We rely on banks and card processors to
provide clearing, processing, and settlement functions for the funding of all transactions on our platform. We also rely on a network
of disbursement partners to disburse funds to recruiters on our platform, including our banking partners and payment solution providers
such as PayPal. We also rely on Amazon.com to send gift cards.

Relationships with our payment partners
are critical to our business. We may not be able to maintain these relationships in the future on terms favorable to us or at all.
Our payment partners may, among other things:

Alternatively, we may be forced to cease
doing business with our payment processors if card association operating rules, certification requirements and laws, regulations,
or rules governing electronic funds transfers to which we are subject change or are interpreted to make it more difficult or impossible
for us to comply. If we are unable to maintain our current relationships with payment partners on favorable terms, or if we are
unable to enter into new agreements with payment partners, our business may be material and adversely affected.

If we are unable to compete effectively,
our business and operating results will be materially and adversely affected.

We face significant competition in all
aspects of our business, and we expect such competition to increase, particularly in the market for online procurement of professional
employee talent. Larger and more established companies may focus on our direct market and could directly compete with us. Smaller
companies, including software developers, could also launch new services that compete with us that could gain market acceptance
quickly.

Many of our current and potential competitors
enjoy substantial competitive advantages, such as greater name recognition, longer operating histories, greater financial, technical,
and other resources, that could allow them to respond more quickly and effectively than we do to new or changing opportunities,
technologies, standards, regulatory conditions, or user preferences or requirements. These companies may use these advantages to
offer products and services similar to ours at a lower price, develop different products and services to compete with our platform.

Moreover, current and future competitors
may also make strategic acquisitions or establish cooperative relationships among themselves or with others, including our current
or future third-party partners. By doing so, these competitors may increase their ability to meet the needs of existing or prospective
users. These developments could limit our ability to obtain revenue from existing and new users. If we are unable to compete effectively
against current and future competitors, our business and operating results would be materially and adversely impacted.

Our future success depends on our ability
to retain and attract high-quality personnel, and the efforts, abilities and continued service of our senior management, and unsuccessful
succession planning could adversely affect our business.

Our future success will depend in large
part on our ability to attract and retain high-quality management, operations, and other personnel who are in high demand, are
often subject to competing employment offers, and are attractive recruiting targets for our competitors. The loss of qualified
executives and key employees, or inability to attract, retain, and motivate high-quality executives and employees required for
the planned expansion of our business, may harm our operating results and impair our ability to grow.

We depend on the continued services of
our key personnel, including Evan Sohn, our Chief Executive Officer and Chairman, Miles Jennings, our President and Chief Operating
Officer, Rick Roberts, the President of Recruiting Solutions, and Judy Krandel, our Chief Financial Officer. The Company has entered
into either employment agreements or consulting agreements with Evan Sohn, Miles Jennings and Judy Krandel, and Rick Roberts. Our
work with each of these key personnel are subject to changes and/or termination, and our inability to effectively retain the services
of our key management personnel, could materially and adversely affect our operating results and future prospects.

If there are adverse changes in domestic
and global economic conditions, it may negatively impact our business.

Our business depends on the continued demand
for labor and on the economic health of current and prospective clients that use our platform and services. Any significant weakening
of the economy in the United States or globally, more limited availability of credit, a reduction in business confidence and activity,
economic uncertainty, financial turmoil affecting the banking system or financial markets, a more limited market for independent
professional service providers or information technology services, and other adverse economic or market conditions may adversely
impact our business and operating results. Global economic and political events or uncertainty may cause some of our current or
potential clients to curtail spending on hiring and may ultimately result in new regulatory and cost challenges to our operations.
The COVID-19 pandemic has had a negative effect on the global economic condition as well as the U.S. staffing industry. These adverse
conditions could result in reductions in revenue, longer sales cycles, slower adoption of new technologies and increased competition,
which could in turn materially and adversely affect our business, financial condition, and operating results.

The regulatory framework for privacy
and data protection is complex and evolving, and changes in laws or regulations relating to privacy or the protection or transfer
of personal data, or any actual or perceived failure by us to comply with such laws and regulations, could adversely affect our
business.

During our day-to-day business operations
we receive, collect, store, process, transfer, and use personal information and other user data. As the result, we are subject
to numerous federal, state, local, and international laws and regulations regarding privacy, data protection, information security,
and the collection, storing, sharing, use, processing, transfer, disclosure, and protection of personal information and other content.
We are also subject to the terms of our privacy policies and obligations to third parties related to privacy, data protection,
and information security. We strive to comply with applicable laws, regulations, policies, and other legal obligations relating
to privacy, data protection, and information security to the extent possible. However, the regulatory framework for privacy and
data protection both in the United States and abroad is, and is likely to remain for the foreseeable future, uncertain and complex,
is changing, and the interpretation and enforcement of the rules and regulations that form part of this regulatory framework may
be inconsistent among jurisdictions, or conflict with other laws and regulations. Such laws and regulations as they apply to us
may be interpreted and enforced in a manner that we do not currently anticipate. Any significant change in the applicable laws,
regulations, or industry practices regarding the collection, use, retention, security, or disclosure of user data, or their interpretation,
or any changes regarding the manner in which the express or implied consent of users for the collection, use, retention, or disclosure
of such data must be obtained, could increase our costs and require us to modify our platform and our products and services, in
a manner that could materially affect our business.

The laws, regulations, and industry standards
concerning privacy, data protection, and information security also continue to evolve. For example, in June 2018, California passed
the California Consumer Privacy Act (the “CCPA”), effective January 1, 2020, which requires companies that process
personal information of California residents to make new disclosures to consumers about such companies’ data collection,
use, and sharing practices and inform consumers of their personal information rights such as deletion rights, allows consumers
to opt out of certain data sharing with third parties, and provides a new cause of action for data breaches. The State of Nevada
has also passed a law, effective October 1, 2019, that amends the state’s online privacy law to allow consumers to submit
requests to prevent websites and online service providers from selling personally identifiable information that they collect through
a website or online service. The costs of compliance with, and other burdens imposed by, the privacy and data protection laws and
regulations may limit the use and adoption of our services and could have a material adverse impact on our business. As a result,
we may need to modify the way we treat such information.

Any failure or perceived failure by us
to comply with any privacy and data protection policies, laws, rules, and regulations could result in proceedings or actions against
us by individuals, consumer rights groups, governmental entities or agencies, or others. We could incur significant costs investigating
and defending such claims and, if found liable, significant damages. Further, public scrutiny of or complaints about technology
companies or their data handling or data protection practices, even if unrelated to our business, industry, or operations, may
lead to increased scrutiny of technology companies, including us, and may cause government agencies to enact additional regulatory
requirements, or to modify their enforcement or investigation activities, which may increase our costs and risks.

If we sustain an impairment in the carrying
value of long-lived assets and goodwill, it will negatively affect our operating results.

As the result of our purchase of certain assets of Genesys in
March 2019, we have a significant amount of long-lived intangible assets and goodwill on our consolidated balance sheet. Under
the Generally Accepted Accounting Principles in the U.S. (“GAAP”), long-lived assets are required to be reviewed for
impairment whenever events or changes in circumstances indicate that the book value of the asset may not be recoverable. If business
conditions or other factors cause profitability and cash flows to decline, we may be required to record non-cash impairment charges.
Goodwill must be evaluated for impairment at least annually or more frequently if events indicate it is warranted. If the carrying
value of a reporting unit exceeds its current fair value, the goodwill is considered impaired. Events and conditions that could
result in impairment in the value of our long-lived assets and goodwill include, but are not limited to, significant negative industry
or economic trends, competition and adverse changes in the regulatory environment, significant decline in the Company’s stock
price for a sustained period of time, limited funding, as well as or other factors leading to reduction in expected long-term revenues
or profitability. If we record impairment charges related to our goodwill and long-lived assets, our operating results would likely
be materially and adversely affected.

If we fail to maintain an effective
system of disclosure controls and internal control over financial reporting, our ability to produce timely and accurate financial
statements or comply with applicable regulations could be impaired.

As a public company, we are subject to
the reporting requirements of the Securities Exchange Act of 1934 and the Sarbanes-Oxley Act which requires, among other things,
that we maintain effective disclosure controls and procedures and internal control over financial reporting. In order to maintain
and improve the effectiveness of our disclosure controls and procedures and internal control over financial reporting, we have
expended, and anticipate that we will continue to expend, significant resources, including accounting-related costs and significant
management oversight.

Any failure to develop or maintain effective
controls or any difficulties encountered in their implementation or improvement could cause us to fail to meet our reporting obligations
and may result in a restatement of our financial statements for prior periods. If we fail to maintain an effective system of disclosure
controls and internal control over financial reporting, our ability to produce timely and accurate financial statements or comply
with applicable regulations could be impaired, which could result in loss of investor confidence and could have an adverse effect
on our stock price.

As of December 31, 2019, management determined
that here were material weaknesses in both the design and effectiveness of our internal control over financial reporting. A material
weakness in internal controls is a deficiency in internal control, or combination of control deficiencies, that adversely affects
our ability to initiate, authorize, record, process, or report external financial data reliably in accordance with GAAP such that
there is more than a remote likelihood that a material misstatement of our annual or interim financial statements that is more
than inconsequential will not be prevented or detected. Specifically, we restated our Form 10-Q filings for the three months ended
June 30, 2019 and March 31, 2019 to switch $484,090 from net revenue to gross revenue. This change had an effect on total revenue
and cost of goods sold but not on cash flow. In the course of making our assessment of the effectiveness of internal controls over
financial reporting, we identified at least two material weaknesses in our internal control over financial reporting. Specifically,
(1) we lack a sufficient number of employees to properly segregate duties and provide adequate monitoring during the process leading
to and including the preparation of the consolidated financial statements and, as of that date, (2) we lacked sufficient independent
directors on our Board to maintain audit and other committees consistent with proper corporate governance standards. Accordingly,
management’s assessment is that the Company’s internal controls over financial reporting were not effective as of December
31, 2020.

In May 2020, our Board appointed Judy Krandel
as our Chief Financial Officer. We have worked to establish all the checks and balances needed for all financial areas of our business.
We hired a consultant in mid-2020 to establish best practices and help us document and implement these. This consultant is a CPA
and has a significant background in running the accounting and budgeting process for public companies. We began adopting these
best practices in the fourth quarter.

Deborah Leff was approved by the Board
as an independent director. She joined the Board on October 1, 2020. The Board approved Robert Heath as an independent director
in December 2020 and he will join the board in the first half of 2021. We now have a board with a majority of independent directors.
As such, as of the date of this filing, management has determined that the concern regarding material weaknesses regarding lack
of independent directors in the Company’s internal controls over financial reporting has been sufficiently addressed.

Risks Relating to Our Common Stock

As a result of our recent financings
and acquisitions we have issued a substantial number of additional shares of Common Stock, which dilutes present stockholders and
have issued dilutive instruments which may dilute present stockholders.

During the period from March 2019 through
January 2021, we engaged in a series of private placement transactions issuing to several accredited investors shares of convertible
preferred stock, convertible debentures and warrants to purchase Common Stock. We have also issued convertible preferred stock
in connection with the Merger and Asset Purchase. See “Part I – Item 1. Business – March 31, 2019 Acquisitions”
for further details. As of the date of this Annual Report, there were approximately 25 million shares of Common Stock issuable
upon conversion of our outstanding convertible preferred stock, convertible debentures and exercise of warrants (including warrants
issued to the placement agent in our private placement transactions). In the future, we may grant additional options, warrants
and convertible securities. The exercise, conversion or exchange of options, warrants or convertible securities, including for
other securities, will dilute the percentage ownership of our existing stockholders. The dilutive effect of the exercise or conversion
of these securities may adversely affect our ability to obtain additional capital. The holders of these securities may be expected
to exercise or convert such options, warrants and convertible securities at a time when we would be able to obtain additional equity
capital on terms more favorable than such securities or when our Common Stock is trading at a price higher than the exercise or
conversion price of the securities. If we issue them with conversion or exercise prices below the prices of the preferred stock
held by the investors, we will be required to reduce the conversion prices of our preferred stock held by the investors, which
will increase future dilution. The exercise or conversion of outstanding warrants, options and convertible securities will have
a dilutive effect on the securities held by our stockholders. We have in the past, and may in the future, exchange outstanding
securities for other securities on terms that are dilutive to the securities held by other stockholders not participating in such
exchange.

Because our Common Stock is subject
to the “penny stock” rules, brokers cannot generally solicit the purchase of our Common Stock, which adversely affects
its liquidity and market price.

The SEC has adopted regulations which generally
define “penny stock” to be an equity security that has a market price of less than $5.00 per share, subject to specific
exemptions. The market price of our Common Stock on OTCQB is presently less than $5.00 per share and therefore we are considered
a “penny stock” according to SEC rules. Further, while we may effect a reverse stock split in the future and our stock
price may rise above $5.00, there is no guarantee that our stock price will rise or stay above $5.00 per share. The “penny
stock” designation requires any broker-dealer selling these securities to disclose certain information concerning the transaction,
obtain a written agreement from the purchaser and determine that the purchaser is reasonably suitable to purchase the securities.
These rules limit the ability of broker-dealers to solicit purchases of our Common Stock and therefore reduce the liquidity of
our shares.

Moreover, as a result of apparent regulatory
pressure from the SEC and the Financial Industry Regulatory Authority, a growing number of broker-dealers decline to permit investors
to purchase and sell or otherwise make it difficult to sell shares of penny stocks. The “penny stock” designation may
continue to have a depressive effect upon our Common Stock price.

Our Common Stock may be affected by
limited trading volume and price fluctuations, which could adversely impact the value of our Common Stock.

There has been limited trading in our Common
Stock and there can be no assurance that an active trading market in our Common Stock will either develop or be maintained. Our
Common Stock is likely to experience in the future, significant price and volume fluctuations, which could adversely affect the
market price of our Common Stock without regard to our operating performance. In addition, we believe that factors such as quarterly
fluctuations in our financial results and changes in the overall economy or the condition of the financial markets, including as
the result of the COVID-19 pandemic, could cause the price of our Common Stock to fluctuate substantially. These fluctuations may
also cause short sellers to periodically enter the market in the belief that we will have poor results in the future. We cannot
predict the actions of market participants and, therefore, can offer no assurances that the market for our Common Stock will be
stable or appreciate over time.

If we fail to meet the continued eligibility
requirements of the OTCQB, our Common Stock may be unable to remain traded on the OTCQB market of the OTC Markets Group.

There is no active trading market for our
Common Stock which trades on the OTCQB. The OTCQB has certain continued eligibility requirements including the requirement to maintain
at least 10{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} free trading public float. Because the Company is a former shell, any Common Stock issued upon conversion of convertible
securities issued in a private placement less than two years from the measuring date (unless sold) as well as Common Stock owned
by our officers, directors and any affiliates are not considered part of the public float under the OTCQB standards. We received
notices from OTC Markets Group Inc. in the past regarding failure to meet the public float requirement but were able to regain
compliance. Previously we were able to regain compliance by persuading certain holders of our preferred stock to convert shares.
The same problem can occur if we issue Common Stock in private placements or in exchange for services. If we fail to meet this
OTCQB requirement or other continued eligibility requirements, our Common Stock will trade on OTC Pink which is even more illiquid
than the OTCQB. We cannot assure you that we will continue to comply with the continued eligibility requirements in the future
particularly as long as our Common Stock is not actively traded.

Offers or availability for sale of a
substantial number of shares of our Common Stock may cause the price of our Common Stock to decline.

If our stockholders convert preferred stock
or convertible debentures or exercise warrants, it could create a circumstance commonly referred to as an “overhang”
and in anticipation of which the market price of our Common Stock could fall. The existence of an overhang, whether or not sales
have occurred or are occurring, also could make more difficult our ability to raise additional financing through the sale of equity
or equity-related securities in the future at a time and price that we deem reasonable or appropriate. The shares of our restricted
Common Stock may be publicly sold pursuant to Rule 144 under the Securities Act six months after issuance of convertible securities.

Because we may issue preferred stock
without the approval of our stockholders and have other anti-takeover defenses, it may be more difficult for a third party to acquire
us and could depress our stock price.

In general, the Board may authorize,
without a vote of our stockholders, an issuance of one or more additional series of preferred stock that have more than one
vote per share, although the Company’s ability to designate and issue preferred stock is currently restricted by
covenants under our agreements with prior investors. Without these restrictions, our Board could issue preferred stock to
investors who support us and our management and give effective control of our business to our management. Additionally,
issuance of preferred stock could block an acquisition resulting in both a drop in our stock price and a decline in interest
of our Common Stock. This could make it more difficult for shareholders to sell their Common Stock. This could also cause the
market price of our Common Stock shares to drop significantly, even if our business is performing well.

A small group
of stockholders controls our Company, which could limit your ability to influence the outcome of key transactions, including changes
of control.

A small group of stockholders, including our management, controls
approximately 40{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} of our outstanding voting power and therefore is able to exert a significant amount of influence over our management
and affairs and all matters requiring stockholder approval, including significant corporate transactions. These stockholders may
have interests that differ from yours, and they may vote in a way with which you disagree and that may be adverse to your interests.
This concentration of ownership may have the effect of delaying or preventing any change in control transaction, and by limiting
the number of shares of our stock traded in public markets could adversely affect liquidity and price of our Common Stock.

If our Common Stock becomes subject
to a “chill” imposed by the Depository Trust Company (the “DTC”), your ability to sell shares of our Common
Stock may be limited.

The DTC acts as a depository or nominee
for the shares held in “street name.” In the last several years, the DTC has increasingly imposed a chill or freeze
on the deposit, withdrawal and transfer of Common Stock of issuers whose Common Stock trades on the tiers of the OTC Markets. Depending
on the type of restriction, a chill or freeze can prevent stockholders from buying or selling shares and prevent companies from
raising money. A chill or freeze may remain imposed on a security for a few days or an extended period of time (in at least one
instance a number of years). While we have no reason to believe a chill or freeze will be imposed against our Common Stock, if
it were to do so your ability to sell shares of our Common Stock would be limited. In such event, your investment will be adversely
affected.

None.

The Company currently does not own any
properties.

Our corporate headquarters are located
in Houston, Texas, where we occupy facilities totaling approximately 5,480 square feet under a lease that expires in November 2022.
See “Part III – Item 13. Certain Relationships and Related Transactions” for further information. We do not currently
have other leased offices.

Apart from disruptions caused by COVID-19, three of our senior
executives, our Chief Executive Officer, our Executive Chairman and our Chief Financial Officer work remotely while a fourth key
executive, our Chief Technology Officer is an employee of a third-party service company based in Mauritius. Our Chief Technology
Officer devotes substantially all of his time to his duties for the Company. The President of Recruiting Solutions works from our
Houston office.

We believe that our facilities are adequate
to meet our needs for the immediate future, and that, should it be needed, suitable additional space will be available to accommodate
any such expansion of our operations.  

From time-to-time, the Company may be a
party to, or otherwise involved in, legal proceedings arising in the normal course of business. As of the date of this Annual Report,
there are no material pending legal or governmental proceedings relating to our Company or properties to which we are a party,
and, to our knowledge, there are no material proceedings to which any of our directors, executive officers or affiliates are a
party adverse to us or which have a material interest adverse to us.

Not Applicable.

Market Information

Our Common Stock trades on the OTCQB under
the symbol “RCRT.” The Common Stock’s prices reflect inter-dealer prices, without retail mark-up, mark-down or commission
and does not necessarily represent actual transactions.

Holders

As of February 18, 2021, there were approximately
425 registered holders of record of our Common Stock, nine holders of record of our Series D Convertible Preferred Stock, approximately
12 holders of record of our Series E Convertible Preferred Stock, and approximately twelve holders of record of our Series F Convertible
Preferred Stock. Since certain shares of our Common Stock are held by brokers and other institutions on behalf of stockholders,
the foregoing number of holders of our Common Stock is not representative of the number of beneficial holders of our Common Stock.

Dividends

To date, we have not paid cash dividends
on our Common Stock and do not plan to pay such dividends in the foreseeable future. Our Board will determine our future dividend
policy on the basis of many factors, including results of operations, capital requirements, and general business conditions. Dividends,
under the Nevada Revised Statutes, may only be paid from our net profits or surplus. To date, we have not had a fiscal
year with net profits and, subject to a valuation by the Board of the present value of the Company’s assets, do not have
surplus.

Unregistered Sales of Equity Securities

We have previously disclosed all sales
of securities without registration under the Securities Act of 1933.

Not applicable.

The following discussion and analysis
should be read in conjunction with our consolidated financial statements and related notes appearing elsewhere in this Annual Report.
In addition to historical information, this discussion and analysis contains forward-looking statements that involve risks, uncertainties,
and assumptions. Our actual results may differ materially from those anticipated in these forward-looking statements as a result
of certain factors, including but not limited to those set forth in “Part I – Item 1A. Risk Factors.”

Overview

Recruiter.com
Group, Inc. (“Recruiter.com,” “we.” “the Company,” “us”) is an on-demand recruiting
platform aimed to disrupt the $120 billion recruiting and staffing industry. Recruiter.com combines an online hiring platform with
the world’s largest network of over 28,000 small and independent recruiters. Businesses of all sizes recruit talent faster using
the Recruiter.com platform, which is powered by virtual teams of Recruiters On Demand and Video and AI job-matching technology. 

Our website, www.Recruiter.com, provides
access to over 28,000 recruiters and utilizes an innovative web platform, with integrated AI-driven candidate to job matching and
video screening software to more easily and quickly source qualified talent.

We help businesses accelerate and
streamline their recruiting and hiring processes by providing on-demand recruiting services and technology. We leverage our expert
network of recruiters to place recruiters on a project basis, aided by cutting edge artificial intelligence-based candidate sourcing,
matching and video screening technologies. We operate a cloud-based scalable SaaS-enabled marketplace platform for professional
hiring, which provides prospective employers access to a network of thousands of independent recruiters from across the country
and worldwide, with a diverse talent sourcing skillset that includes information technology, accounting, finance, sales, marketing,
operations and healthcare specializations.

Our mission is to grow our most
collaborative and connective global platform to connect recruiters and employers and become the preferred solution for hiring specialized
talent. 

We generate revenue from the following
activities:

The costs of our revenue primarily consist
of employee costs, third-party staffing costs and other fees, outsourced recruiter fees and net margin revenue share.

Our results of operations and financial
condition may be impacted positively and negatively by certain general macroeconomic and industry wide conditions, such as the
effects of the COVID-19 pandemic. The consequences of the pandemic and impact on the U.S. and global economies continue to evolve
and the full extent of the impact is uncertain as of the date of this filing. The pandemic has had a detrimental effect on
many recruitment technology companies and on the general employment and staffing industry. If the recovery from the COVID-19 pandemic
is not robust, the impact could be prolonged and severe. We have reduced certain billing rates to respond to the current economic
climate. Additionally, while we have experienced, and could continue to experience, a loss of clients as the result of the pandemic,
we expect that the impact of such attrition would be mitigated by the addition of new clients resulting from our continued efforts
to adjust the Company’s operations to meet the demands of the greater recruitment industry. The extent to which the COVID-19
pandemic will impact our operations, ability to obtain financing or future financial results is uncertain at this time. As a result
of COVID-19, the Company took steps to streamline certain expenses, including temporarily cutting certain executive compensation
packages by approximately 20{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3}. Management also worked to reduce unnecessary marketing expenditures and worked to improve staff
and human capital expenditures, while maintaining overall workforce levels. The Company expects but cannot guarantee that demand
for its recruiting solutions will improve in 2021, as certain clients re-open or accelerate their hiring initiatives, and new clients
utilize our services. The Company does not expect reductions made in Q2 2020 due to COVID-19 to inhibit its ability to meet client
demand. Overall, management is focused on effectively positioning the Company for a rebound in hiring, which we expect to occur
in 2021. Ultimately, the recovery may be delayed, and the economic conditions may worsen. The Company continues to closely monitor
the confidence of its recruiter users and customers, and their respective job requirement load through offline discussions and
the Company’s Recruiter Index survey, which surveys recruiters’ sentiment on the job market and demand for recruiting
services.

2020 Business Update

Our focus during 2020 comprised many areas
to help improve our organizational structure, financial position, and corporate governance. Additionally, we continued investing
and partnering to expand our service offerings and client and candidate reach. We also supplemented our internal efforts with a
focus on acquisitions to help add scale, management talent and technology. All the while, we shared our progress with media outreach
and a focused investor relations effort.

Key Highlights include:

Corporate Organization

Additionally, effective May 28,
2020, we entered into Securities Purchase Agreements with several accredited investors and sold to the Purchasers a total of
(i) $2,953,125 in the aggregate principal amount of 12.5{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} Original Issue Discount Senior Subordinated Secured Convertible
Debentures, and (ii) 1,845,703 common stock purchase warrants, which represents 100{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} warrant coverage. The Company received a
total of $2,226,000 in net proceeds from the offering, after deducting the 12.5{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} original issue discount of $328,125,
offering expenses and commissions, including the placement agent’s commission and fees of $295,000, reimbursement of
the placement agent’s and lead investor’s legal fees and the Company’s legal fees in the aggregate amount
of $100,000 and escrow agent fees of $4,000. The Company also agreed to issue to the placement agent, as additional
compensation, 369,141 common stock purchase warrants exercisable at $2.00 per share. The Debentures mature on May 28, 2021,
subject to a six-month extension at the Company’s option. The Debentures bear interest at 8{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} per annum payable
quarterly, subject to an increase in case of an event of default as provided for therein. The Debentures are convertible into
shares of Common Stock at any time following the date of issuance at the Purchasers’ option at a conversion price of
$1.60 per share, subject to certain adjustments. The Debentures are subject to mandatory conversion in the event the Company
closes an equity offering of at least $5,000,000 resulting in the listing of the Company’s common stock on a national
securities exchange. The Debentures rank senior to all existing and future indebtedness of the Company and its subsidiaries,
except for approximately $77,040 of outstanding senior indebtedness. The Company may prepay the Debentures at any time at a
premium as provided for therein. The Warrants are exercisable for three years from May 28, 2020 at an exercise price of $2.00
per share, subject to certain adjustments.

Investment and Expansion of Offerings

Partnerships/Acquisitions

Since December 31, 2019, we entered into the following partnerships
or made the following acquisitions:

Media

Results of Operations.

Revenue

Our revenue for the year ended December
31, 2020 was $8,502,892 compared to $5,997,987 for the prior year representing an increase of $2,504,905 or 41.8{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3}. This increase
resulted primarily from the acquisition in March 2019 of certain assets and business from Genesys, now housed within the Company’s
Recruiting Solutions division. The Company’s Consulting and Staffing businesses also began to show sequential growth from
the third to the fourth quarter as we benefitted from efforts to grow existing relationships as well as build new customers in
the health care, and mortgage finance industries. We also had an increase in our Recruiters on Demand business due to beginning
work with new customers, some of which we acquired through the hiring of a key employee, on July 1, 2020 and others we developed
internally. We also experienced growth in our Career Solutions business through a sales channel partner, as general job market
conditions were favorable for the product. Offsetting our growth was a decline in marketing revenue as we continued to shift internal
resources to focus on our core on-demand recruiting and recruiting technology business. The extent to which the COVID-19 pandemic
will impact our revenue in the subsequent future periods is uncertain at this time.

Cost of Revenue

Cost of revenue for the year ended December
31, 2020 was $6,138,363, which included related party costs of $1,363,905, compared to $4,448,202 in the prior year which included
related party costs of $2,082,367. Cost of revenue was primarily attributable to third party staffing costs and other fees related
to the recruitment and staffing business acquired from Genesys Talent, LLC (“Genesys”), (currently the Company’s
Recruiting Solutions division).

Our gross profit for 2020 was $2,364,529
which produced a gross profit of 27.8{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3}. In 2019 our gross profit was $1,549,785 which produced a gross profit margin of 25.8{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3}.
The increase in the gross profit margin from 2019 to 2020 reflects in part the shift in the mix in sales for the year as our Permanent
Placement, Recruiters on Demand and Career Services revenue, which have higher gross margins than our Consulting and Staffing revenue,
represented a larger percentage of our total revenue. Additionally, we experienced a higher gross margin in our Consulting and
Staffing business year over year as we focused on growing business with clients that yielded higher gross margins and retained
more business as the employer of record which yields higher gross margins.

Operating Expenses

We had
total operating expenses of $9,102,792 for the year ended December 31, 2020 compared to $12,053,967 for the year ended
December 31, 2019. The decrease was primarily due to a $3 million non-cash impairment expense in 2019 related to the March
2019 Asset Purchase. Declines in sales and marketing and general and administrative expense were offset by increases in
product development expense and the amortization of intangibles.

Sales and Marketing

Our sales and marketing expense for the
year ended December 31, 2020 was $82,904 compared to $119,597 for the prior year, which reflected more conservative spending given
COVID-19 and the uncertain financial and political environment.

Product Development

Our product development expense for the
year ended December 31, 2020 increased to $299,512 from $203,400 for the prior year. This increase is attributable to the continued
investment in our product offerings. The product development expense in 2020 included approximately $235,444 paid to Recruiter.com
Mauritius, a related party. In 2019, product development expense included $181,400 paid to Recruiter.com Mauritius.

Amortization of Intangibles and Impairment
Expense

For the year ended December 31, 2020, we
incurred a non-cash amortization charge of $686,691 related to the intangible assets acquired from Genesys, now the Company’s
Recruiting Solutions division, and the cost of acquiring customer contracts on July 1, 2020 for our Recruiters on Demand business.
For 2019 we incurred an amortization charge of $477,518. We began to record amortization expense for the Genesys asset acquisition
starting in the fourth quarter of 2019 when the purchase allocation was finalized. Following our annual goodwill impairment test
as of December 31, 2019, we recorded a non-cash goodwill impairment charge of approximately $3,000,000, primarily due to the market
capitalization of the Company’s Common Stock. We also recorded approximately $113,000 of software impairment in 2019.

General and Administrative

General and administrative expense include
compensation-related costs for our employees dedicated to general and administrative activities, legal fees, audit and tax fees,
consultants and professional services, and general corporate expenses. For the year ended December 31, 2020, our general and administrative
expenses were $8,033,685 including $3,212,772 of non-cash stock-based compensation. In 2019, our general and administrative expense
was $8,140,432, including $4,643,127 of non-cash stock-based compensation. The increase in general and administrative expense excluding
stock-based compensation was due in part to expenses related to a full year of business in 2020 versus a partial year in 2019 due
to the merger in March 2019. Additionally, we had an increase in salaries, software, insurance, filing and investor relations fees
building our infrastructure to support future growth of our business.

Other Income (Expense)

Other income (expense) for the year ended
December 31, 2020 consisted of net expense of $10,298,574 compared to net expense of $1,339,331 in 2019. The primary reason for
the increase of $8,959,243 is due to non-cash charges of $3,340,554 from an initial derivative expense and $2,642,175 from a change
in derivative value due to anti-dilution adjustments. Additionally, we had a non-cash charge of $2,658,261 due to a change in the
fair value of derivative liability from our outstanding warrants issued in 2019. As our common stock price increases, we incur
an expense and contrarily if our common stock decreases, we recognize other income. We also had interest expense of $2,022,113
which is primarily related to note discount amortization and note debt cost amortization from our convertible note financing completed
in May and June of 2020. We did recognize income of $376,177 from the forgiveness of Payroll Protection Program debt.

Net loss

In 2020, we incurred a net loss of $17,036,837
compared to $11,843,513 in 2019. After taking into account the accrued preferred stock dividends, we incurred a net loss attributable
to shareholders of $17,036,837 in 2020 compared to $11,953,207 in 2019.

Definition of Non-GAAP Financial Measures

The following discussion and analysis includes
both financial measures in accordance with Generally Accepted Accounting Principles, or GAAP, as well as non-GAAP financial measures.
Generally, a non-GAAP financial measure is a numerical measure of a company’s performance, financial position or cash flows
that either excludes or includes amounts that are not normally included or excluded in the most directly comparable measure calculated
and presented in accordance with GAAP. Non-GAAP financial measures should be viewed as supplemental to, and should not be considered
as alternatives to net income, operating income, and cash flow from operating activities, liquidity or any other financial measures.
They may not be indicative of the historical operating results of Recruiter nor are they intended to be predictive of potential
future results. Investors should not consider non-GAAP financial measures in isolation or as substitutes for performance measures
calculated in accordance with GAAP.

Our management uses and relies on EBITDA
and Adjusted EBITDA, which are non-GAAP financial measures. We believe that both management and shareholders benefit from referring
to the following non-GAAP financial measures in planning, forecasting and analyzing future periods. Our management uses these non-GAAP
financial measures in evaluating its financial and operational decision making and as a means to evaluate period-to-period comparison.
Our management recognizes that the non-GAAP financial measures have inherent limitations because of the described excluded items.

Recruiter defines Adjusted EBITDA as earnings
(or loss) from continuing operations before the items in the table below. Adjusted EBITDA is an important measure of our operating
performance because it allows management, investors and analysts to evaluate and assess our core operating results from period-to-period
after removing the impact of items of a non-operational nature that affect comparability.

We have included a reconciliation of our
non-GAAP financial measures to the most comparable financial measure calculated in accordance with GAAP. We believe that providing
the non-GAAP financial measures, together with the reconciliation to GAAP, helps investors make comparisons between the Company
and other companies. In making any comparisons to other companies, investors need to be aware that companies use different non-GAAP
measures to evaluate their financial performance. Investors should pay close attention to the specific definition being used and
to the reconciliation between such measure and the corresponding GAAP measure provided by each company under applicable SEC rules.

The following table presents a reconciliation
of net loss to Adjusted EBITDA:

Liquidity and Capital Resources

For the year ended December 31, 2020, net
cash used in operating activities was $2,526,155, compared to net cash used in operating activities of $1,390,858 for 2019. The
increase in cash used in operating activities was attributable to a full year of operations and the growth and investments in our
business following the March 31, 2019 Asset Purchase offset by non-cash charges.

For 2020, cash used in investing activities
was $32,991 principally due to cash paid to acquire customer contracts, compared to $80,739 of cash provided by investing activities
in 2019. The principal driver in 2019 were the sale of marketable securities and proceeds from an asset sale.

In 2020, net cash provided by financing
activities was $2,352,800. The principal factor was $2,476,000 from the sale of convertible notes offset by repayments of other
debt. In 2019, net cash provided by financing activities was $1,602,219. The principal factors were $979,997 from the sale of preferred
stock, a $500,000 refundable deposit on the purchase of preferred stock and $424,510 generated by the sale of future receivables,
offset by a $215,000 repayment of preferred stock deposit and $105,034 in repayment of notes.

Based on cash on hand as of March 4, 2021
of approximately $1,063,000, the Company does not have the capital resources to meet its working capital needs for the next 12
months.

The Company’s consolidated financial
statements are prepared using generally accepted accounting principles in the United States of America applicable to a going concern,
which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company
has incurred net losses and negative operating cash flows since inception. For the year ended December 31, 2020, the Company recorded
a net loss of $17,036,837. The Company has not yet established an ongoing source of revenue that is sufficient to cover its operating
costs and allow it to continue as a going concern. The ability of the Company to continue as a going concern is dependent on the
Company obtaining adequate capital to fund operating losses until it becomes profitable.

The Company’s historical operating
results indicate substantial doubt exists related to the Company’s ability to continue as a going concern. We can give no
assurances that any additional capital that we are able to obtain, if any, will be sufficient to meet our needs, or that any such
financing will be obtainable on acceptable terms. If we are unable to obtain adequate capital, we could be forced to cease operations
or substantially curtail our commercial activities. These conditions raise substantial doubt as to our ability to continue as a
going concern. The accompanying consolidated financial statements do not include any adjustments relating to the recoverability
and classification of recorded asset amounts and classification of liabilities should we be unable to continue as a going concern.

To date, private equity offerings have
been our primary source of liquidity and we expect to fund future operations through additional securities offerings. We have also
entered into arrangements with factoring companies to receive advances against certain future accounts receivable in order to supplement
our liquidity. The COVID-19 pandemic has affected the Company’s ability to receive advances against its future accounts receivable
as discussed in more detail below.

Financing Arrangements

Merchant Receivables Purchase and Security
Agreements

The Company and its subsidiaries are parties
to a Merchant Receivables Purchase and Security Agreement, dated December 6, 2019 (the “First Receivables Purchase Agreement”),
with Change Capital Holdings I, LLC (“Change Capital”) and a Merchant Receivables Purchase and Security Agreement,
dated December 16, 2019, with Change Capital (the “Second Receivables Purchase Agreement” and together with the First
Receivables Purchase Agreement, the “Receivables Purchase Agreements”). Pursuant to the Receivables Purchase Agreements,
Change Capital has agreed to advance a total of $450,000 in cash (the “Purchase Price”) and the Company and its subsidiaries
agreed to pay Change Capital in equal weekly installments over the course of 52 weeks an amount of approximately $567,000 (the
“Specified Amount”), which amount includes the fees payable by the Company under the Receivables Purchase Agreements.
As long as no default has occurred under the Receivables Purchase Agreements, the Company has the right to pay the remaining balance
of the Specified Amount to Change Capital prior to the due date at a total cost of 3{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} of the Purchase Price per month. Pursuant
to the Receivables Purchase Agreements, the Company and the subsidiaries party to the Receivables Purchase Agreements also granted
to Change Capital a security interest in all their assets now owned or acquired in the future. In May 2020, the Receivables Purchase
Agreements were amended to limit the outstanding principal amount to $408,777 payable as two payments of $5,452 weekly, plus any
default fees, late fees, legal fees and expenses and any other costs or expenses incurred in enforcing Change Capital’s rights
under the Receivables Purchase Agreements. The Receivables Purchase Agreements contain covenants which limit the Company’s
ability to enter into any secured financing agreements without the prior written consent of Change Capital. The transactions pursuant
to the Receivables Purchase Agreements have been accounted for as “Sale of Future Revenues.” As of December 31, 2020,
our outstanding balance with Change Capital was $10,904. As of January 8, 2021 the outstanding balance was $0 and there are no
other payments or fees owed under the Receivables Purchase Agreements. The Company does not anticipate receiving any additional
advances under the Receivables Purchase Agreements.

Agreement with Qwil PBC

A wholly-owned subsidiary of the Company
was also a party to a receivables financing agreement with Qwil PBC, entered into in January 2020, that provided advances against
the collection of accounts receivable. Advances made under the agreement were generally repayable in 45 days from the date of the
advance and carried interest at 1.5{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} per month. In April 2020, Qwil informed the Company that it would not be able to advance additional
funds pursuant to this arrangement due to the impact of the COVID-19 pandemic. In May 2020, the Company negotiated a more favorable
repayment plan with Qwil PBC, which consisted of payments of approximately $7,903 bi-weekly through August 14, 2020 and a weekly
payment of $7,903 from August 21, 2020 through September 18, 2020, without additional interest. As of December 31, 2020, our outstanding
balance with Qwil PBC was $0.

The advances received pursuant to the arrangements
with Change Capital and Qwil were carried as liabilities on our balance sheet and the accounts receivable remained on our books
until collected.

Term Loans

We have outstanding balances of $77,040
and $103,800 pursuant to two term loans as of December 31, 2020 and December 31, 2019, respectively, which mature in
2023. The loans have variable interest rates, with current rates at 6.0{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} and 7.76{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3}, respectively. Current monthly payments under
the loans are $1,691 and $1,008, respectively.

Paycheck Protection Program Loan

During April and May 2020 the Company,
through its four subsidiaries, received an aggregate of $398,545 in loans borrowed from a bank pursuant to the Paycheck Protection
Program under the CARES Act guaranteed by the SBA, which we expect to be forgiven in part or in full, subject to our compliance
with the conditions of the Paycheck Protection Program. If not forgiven, the terms on the note provide for interest at 1{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} per year
and the note mature in 24 months, with 18 monthly payments beginning after the initial 6 month deferral period for payments. We
have applied for forgiveness for all loans. As of December 31, 2020 $373,795 of loans have been forgiven and the balance of $24,750
was forgiven subsequently. We have classified the remaining balance of $24,750 as long term at December 31, 2020. We recorded forgiveness
of debt income of $376,177 for the $373,795 of principal and $2,382 of related accrued interest forgiven in 2020.

Senior Subordinated Secured Convertible
Debentures

In May and June 2020, the Company entered
into a Securities Purchase Agreement, effective May 28, 2020 (the “Purchase Agreement”) with several accredited investors
(the “Purchasers”). Four of the investors had previously invested in the Company’s preferred stock. Pursuant
to the Purchase Agreement, the Company sold to the Purchasers a total of (i) $2,953,125 in the aggregate principal amount of 12.5{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3}
Original Issue Discount Senior Subordinated Secured Convertible Debentures (the “Debentures”), and (ii) 1,845,703 common
stock purchase warrants (the “Warrants”), which represents 100{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} warrant coverage. The Company received a total of $2,226,000
in net proceeds from the offering, after deducting the 12.5{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} original issue discount of $328,125, offering expenses and commissions,
including the placement agent’s commission and fees of $295,000 and reimbursement of the placement agent’s and lead
investor’s legal fees and the Company’s legal fees in the aggregate amount of $100,000 and escrow agent fees of $4,000.
The Company also agreed to issue to the placement agent, as additional compensation, 369,141 common stock purchase warrants exercisable
at $2.00 per share. 

The Debentures mature on May 28, 2021,
subject to a six-month extension at the Company’s option. The Debentures bear interest at 8{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} per annum payable quarterly,
subject to an increase in case of an event of default as provided for therein. The Debentures are convertible into shares of the
Company’s common stock at any time following the date of issuance at the purchasers’ option at a conversion price of
$1.60 per share, subject to certain adjustments. The Debentures are subject to mandatory conversion in the event the Company closes
an equity offering of at least $5,000,000 resulting in the listing of the Company’s common stock on a national securities
exchange. The Debentures rank senior to all existing and future indebtedness of the Company and its subsidiaries, except for approximately
$508,000 of outstanding senior indebtedness. The Company may prepay the Debentures at any time at a premium as provided for therein.

The Company’s obligations under the
Debentures are secured by a first priority lien on all of the assets of the Company and its subsidiaries, subject to certain existing
senior liens. The Company’s obligations under the Debentures are guaranteed by the Company’s subsidiaries.

The Securities Purchase Agreement for the
Debentures and Warrants contains customary representations, warranties and covenants of the Company, including, among other things
and subject to certain exceptions, covenants that restrict the ability of the Company and its subsidiaries, without the prior written
consent of the Debenture holders, to incur additional indebtedness, including further advances under a certain preexisting secured
loan, and repay outstanding indebtedness, create or permit liens on assets, repurchase stock, pay dividends or enter into transactions
with affiliates. The Debentures contain customary events of default, including, but not limited to, failure to observe covenants
under the Debentures, defaults on other specified indebtedness, loss of admission to trading on OTCQB or another applicable trading
market, and occurrence of certain change of control events. Upon the occurrence of an event of default, an amount equal to 130{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3}
of the principal, accrued but unpaid interest, and other amounts owing under each Debenture will immediately come due and payable
at the election of each Purchaser, and all amounts due under the Debentures will bear interest at an increased rate. 

On January 5, 2021, Recruiter.com Group,
Inc. (the “Company”) entered into a Securities Purchase Agreement, effective January 5, 2021 (the “Purchase Agreement”),
with two accredited investors (the “Purchasers”). Pursuant to the Purchase Agreement, the Company agreed to sell to
the Purchasers a total of (i) $562,500 in the aggregate principal amount of 12.5{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} Original Issue Discount Senior Subordinated Secured
Convertible Debentures (the “Debentures”), and (ii) 351,562 common stock purchase warrants (the “Warrants”),
which represents 100{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} warrant coverage. The Company received a total of $500,000 in gross proceeds from the offering, taking into
account the 12.5{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} original issue discount, before deducting offering expenses and commissions, including the placement agent’s
commission of $50,000 (10{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} of the gross proceeds) and fees related to the offering of the Debentures of approximately $40,000.
The Company also agreed to issue to the placement agent, as additional compensation, 70,313 common stock purchase warrants exercisable
at $2.00 per share (the “PA Warrants”). Joseph Gunnar& Co. LLC acted as placement agent for the offering of the
Debentures.

On January 20, 2021, Recruiter.com Group,
Inc. (the “Company”) entered into a Securities Purchase Agreement, (the “Purchase Agreement”) with eighteen
accredited investors (the “Purchasers”). Pursuant to the Purchase Agreement, the Company agreed to sell to the Purchasers
a total of (i) $2,236,500 in the aggregate principal amount of 12.5{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} Original Issue Discount Senior Subordinated Secured Convertible
Debentures (the “Debentures”), and (ii) 1,397,813 common stock purchase warrants (the “Warrants”), which
represents 100{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} warrant coverage. Joseph Gunnar & Co. LLC (“Gunner”) acted as placement agent for the offering
of the Debentures. The Company received a total of $1,988,000 in gross proceeds from the offering, taking into account the 12.5{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3}
original issue discount, before deducting offering expenses and commissions, including Gunner’s commission of $191,270 (10{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3}
of the gross proceeds minus $7,500 paid to Gunner’s counsel) and additional fees related to the offering of the Debentures
of approximately $50,500. The Company also agreed to issue to Gunner, as additional compensation, 279,563 common stock purchase
warrants exercisable at $2.00 per share (the “PA Warrants”).

The Debentures mature on January 5^th
and January 20th, 2022 respectively, subject to a six-month extension at the Company’s option. The Debentures bear interest
at 8{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} per annum payable quarterly, subject to an increase in case of an event of default as provided for therein. The Debentures
are convertible into shares of the Company’s common stock (the “Common Stock”) at any time following the date
of issuance at the Purchasers’ option at a conversion price of $1.60 per share, subject to certain adjustments. The Debentures
are subject to mandatory conversion in the event the Company closes an equity offering of at least $5,000,000 resulting in the
listing of the Common Stock on a national securities exchange. The Debentures rank senior to all existing and future indebtedness
of the Company and its subsidiaries, except for approximately $95,000 of outstanding senior indebtedness. In addition the Debentures
rank pari-passu with, and amounts owing thereunder shall be paid concurrently with, payments owing pursuant to and in connection
with that certain offering by the Company of 12.5{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} Original Issue Discount Senior Subordinated Secured Convertible Debentures due
May 28, 2021 consummated in May and June 2020 in the aggregate principal amount of $2,953,125. The Company may prepay the Debentures
at any time at a premium as provided for therein.

The Warrants are exercisable for three
years from January 5^th and January 20th, 2021 respectively at an exercise price of $2.00 per share, subject to certain
adjustments.

The Company’s obligations under the
Purchase Agreement and the Debentures are secured by a first priority lien on all of the assets of the Company and its subsidiaries
pursuant to a Security Agreement, dated January 5^th and January 20th, 2021 respectively (the “Security Agreement”)
by and among the Company, its wholly-owned subsidiaries, and the Purchasers, subject to certain existing senior liens. The Company’s
obligations under the Debentures are guaranteed by the Company’s subsidiaries.

The Purchase Agreement contains customary
representations, warranties and covenants of the Company, including, among other things and subject to certain exceptions, covenants
that restrict the ability of the Company and its subsidiaries, without the prior written consent of the Debenture holders, to incur
additional indebtedness, including further advances under a certain preexisting secured loan, and repay outstanding indebtedness,
create or permit liens on assets, repurchase stock, pay dividends or enter into transactions with affiliates. The Debentures contain
customary events of default, including, but not limited to, failure to observe covenants under the Debentures, defaults on other
specified indebtedness, loss of admission to trading on OTCQB or another applicable trading market, and occurrence of certain change
of control events. Upon the occurrence of an event of default, an amount equal to 130{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} of the principal, accrued but unpaid interest,
and other amounts owing under each Debenture will immediately come due and payable at the election of each Purchaser, and all amounts
due under the Debentures will bear interest at an increased rate.

Pursuant to the Purchase Agreement, the
Purchasers have certain participation rights in future equity offerings by the Company or any of its subsidiaries after the closing,
subject to customary exceptions. The Debentures and the Warrants also contain certain price protection provisions providing for
adjustment of the number of shares of Common Stock issuable upon conversion of the Debentures and/or exercise of the Warrants and
the conversion or exercise price in case of future dilutive offerings.

In order to meet our working capital needs
for the next 12 months, we expect to finance our operations through additional debt or equity offerings. We may not be able to
complete these or any other financing transactions on terms acceptable to the Company, or at all. Additionally, any future sales
of securities to finance our operations will likely dilute existing shareholders’ ownership. The Company cannot guarantee
when or if it will generate positive cash flow. If we are unable to raise sufficient capital to fund our operations, it is likely
that we will be forced to reduce or cease operations. 

Off-Balance Sheet Arrangements 

None. 

Critical Accounting Estimates and Recent Accounting Pronouncements 

Critical Accounting Estimates 

The preparation of consolidated financial
statements in conformity with accounting principles generally accepted in the United States (“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 and outcomes may differ from management’s estimates and assumptions. Included in these estimates
are assumptions used to estimate collection of accounts receivable, fair value of available for sale securities, fair value of
assets acquired in an asset acquisition and the estimated useful life of assets acquired, fair value of derivative liabilities,
fair value of securities issued for acquisitions, fair value of assets acquired and liabilities assumed in the business combination,
fair value of intangible assets and goodwill, valuation of lease liabilities and related right of use assets, deferred income tax
asset valuation allowances, and valuation of stock based compensation expense.

Revenue Recognition

Policy

The Company recognizes revenue in accordance
with the Financial Accounting Standards Board’s (“FASB”), Accounting Standards Codification (“ASC”)
ASC 606, Revenue from Contracts with Customers (“ASC 606”). Revenues are recognized when control is transferred to
customers in amounts that reflect the consideration the Company expects to be entitled to receive in exchange for those goods.
Revenue recognition is evaluated through the following five steps: (i) identification of the contract, or contracts, with a customer;
(ii) identification of the performance obligations in the contract; (iii) determination of the transaction price; (iv) allocation
of the transaction price to the performance obligations in the contract; and (v) recognition of revenue when or as a performance
obligation is satisfied.

We generate revenue from the following
activities:

We have a sales team and sales partnerships
with direct employers as well as Vendor Management System companies and Managed Service companies that help create sales channels
for clients that buy staffing, direct hire, and sourcing services.  Once we have secured the relationship and contract with
the interested Enterprise customer the delivery and product teams will provide the service to fulfil any or all of the revenue
segments.

Revenues as presented on the statement
of operations represent services rendered to customers less sales adjustments and allowances.

Consulting and Staffing Services revenues
represent services rendered to customers less sales adjustments and allowances. Reimbursements, including those related to travel
and out-of-pocket expenses, are also included in the net service revenues and equivalent amounts of reimbursable expenses are included
in costs of revenue. We record substantially all revenue on a gross basis as a principal versus on a net basis as an agent in the
presentation of this line of revenues and expenses. We have concluded that gross reporting is appropriate because we have
the task of identifying and hiring qualified employees, and our discretion to select the employees and establish their compensation
and duties causes us to bear the risk for services that are not fully paid for by customers. Consulting and staffing revenues
are recognized when the services are rendered by the temporary employees. Payroll and related taxes of certain employees that are
placed on temporary assignment are outsourced to third party payors or related party payors. The payors pay all related costs
of employment for these employees, including workers’ compensation insurance, state and federal unemployment taxes, social
security and certain fringe benefits. We assume the risk of acceptability of the employees to customers. Payments for consulting
and staffing services are typically due within 90 days of completion of services.

Full time placement revenues are recognized
on a gross basis when the guarantee period specified in each customer’s contract expires. No fees for direct hire placement
services are charged to the employment candidates. Any payments received prior to the expiration of the guarantee period are recorded
as a deferred revenue liability. Payments for recruitment services are typically due within 90 days of completion of services.

Recruiters on Demand services are billed
to clients as either monthly subscriptions or time-based billings. Revenues for Recruiters on Demand are recognized on a gross
basis when each monthly subscription service is completed.

Career services revenues are recognized
on a gross basis upon distribution of resumes or completion of training courses, which is the point at which the performance obligations
are satisfied. Payments for career services are typically due upon distribution or completion of services. 

Marketplace Solutions revenues are recognized
either on a gross basis when the advertising is placed and displayed or when lead generation activities and online publications
are completed, which is the point at which the performance obligations are satisfied. Payments for marketing and publishing are
typically due within 30 days of completion of services.

Deferred revenue results from transactions
in which the Company has been paid for services by customers, but for which all revenue recognition criteria have not yet been
met. Once all revenue recognition criteria have been met, the deferred revenues are recognized.

Sales tax collected is recorded on a net
basis and is excluded from revenue.

Goodwill

Goodwill is comprised of the purchase price
of business combinations in excess of the fair value assigned at acquisition to the net tangible and identifiable intangible assets
acquired. Goodwill is not amortized. The Company tests goodwill for impairment for its reporting units on an annual basis, or when
events occur or circumstances indicate the fair value of a reporting unit is below its carrying value.

The Company performs its annual goodwill
and impairment assessment on December 31st of each year.

Long-lived assets

Long-lived assets are reviewed for impairment
whenever events or changes in circumstances indicate that the book value of the asset may not be recoverable. The Company periodically
evaluates whether events and circumstances have occurred that indicate possible impairment. When impairment indicators exist, the
Company estimates the future undiscounted net cash flows of the related asset or asset group over the remaining life of the asset
in measuring whether or not the asset values are recoverable.

Derivative Instruments

The Company’s derivative financial
instruments consist of derivatives related to the warrants issued with the sale of our preferred stock in 2020 and 2019 and the
warrants issued with the sale of convertible notes in 2020 and subsequently in January 2021. The accounting treatment of derivative
financial instruments requires that we record the derivatives at their fair values as of the inception date of the debt agreements
and at fair value as of each subsequent balance sheet date. Any change in fair value is recorded as non-operating, non-cash income
or expense at each balance sheet date. If the fair value of the derivatives was higher at the subsequent balance sheet date, we
recorded a non-operating, non-cash charge. If the fair value of the derivatives was lower at the subsequent balance sheet date,
we recorded non-operating, non-cash income.

Stock-Based Compensation

The Company accounts for all stock-based
payment awards made to employees, directors and others based on their fair values and recognizes such awards as compensation expense
over the vesting period for employees or service period for non-employees using the straight-line method over the requisite service
period for each award as required by FASB ASC Topic No. 718, Compensation-Stock Compensation. If there are any modifications or
cancellations of the underlying vested or unvested stock-based awards, we may be required to accelerate, increase or cancel any
remaining unearned stock-based compensation expense, or record additional expense for vested stock-based awards. Future stock-based
compensation expense and unearned stock- based compensation may increase to the extent we grant additional stock options or other
stock-based awards.

Recently Issued Accounting Pronouncements 

There have not been any recent changes
in accounting pronouncements and ASU issued by the FASB that are of significance or potential significance to the Company except
as disclosed below.

In December 2019, the FASB issued ASU 2019-12,
“Simplifying the Accounting for Income Taxes.” This guidance, among other provisions, eliminates certain exceptions
to existing guidance related to the approach for intraperiod tax allocation, the methodology for calculating income taxes in an
interim period and the recognition of deferred tax liabilities for outside basis differences. This guidance also requires an entity
to reflect the effect of an enacted change in tax laws or rates in its effective income tax rate in the first interim period that
includes the enactment date of the new legislation, aligning the timing of recognition of the effects from enacted tax law changes
on the effective income tax rate with the effects on deferred income tax assets and liabilities. Under existing guidance, an entity
recognizes the effects of the enacted tax law change on the effective income tax rate in the period that includes the effective
date of the tax law. ASU 2019-12 is effective for interim and annual periods beginning after December 15, 2020, with early adoption
permitted. We are currently evaluating the impact of this guidance.

Cautionary Note Regarding Forward-Looking
Statements

This Annual Report includes forward-looking
statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding management’s
beliefs with respect to the impact of the COVID-19 pandemic, the expected launch of the AI-sourced candidate matching on the Recruiter.com
Platform, the anticipated benefits to our clients from the recruitment services that we provide, our plans with respect to continued
growth of our network of recruiters and methods of growing such network, expansion of existing client relationships, growing our
client base through strategic partnerships, investment in new products and features to help recruiters on the Recruiter.com Platform
grow their business, investment of future development of our technology, development of tailored features and functionalities to
customize client experience, potential future acquisitions, our beliefs regarding the possibility of emerging future direct competitors,
expected future expenditures on marketing efforts, our expectation regarding the timing and expected effect of the Company’s
changing its state of incorporation from Delaware to Nevada, the expected future characterization of the small and independent
recruiters on the Recruiter.com Platform as independent contractors, expected future increase in competition, expected future fluctuations
in our stock price, our beliefs with respect to the adequacy of our facilities and our ability to accommodate any future expansion,
our plans with respect to payment of dividends, our expectations for the recovery of the recruitment industry in 2021, the timing
of the software rollout resulting from integration with Censia, our expected decrease in future revenues and increase in the net
loss, future capital-raising activity, expected forgiveness of the loans received under the Paycheck Protection Program, and liquidity.
The words “believe,” “may,” “estimate,” “continue,” “anticipate,” “intend,”
“should,” “plan,” “could,” “target,” “potential,” “is likely,”
“will,” “expect” and similar expressions, as they relate to us, are intended to identify forward-looking
statements. We have based these forward-looking statements largely on our current expectations and projections about future events
and financial trends that we believe may affect our financial condition, results of operations, business strategy and financial
needs. These forward-looking statements are subject to a number of risks, uncertainties and assumptions, including without limitation,
the following:

See “Part I – Item 1A. Risk
Factors” for additional information regarding the risks and uncertainties that could affect our business, financial condition
and results of operations. New risk factors emerge from time-to-time and it is not possible for us to predict all such risk factors,
nor can we assess the impact of all such risk factors on our business or the extent to which any risk factor, or combination of
risk factors, may cause actual results to differ materially from those contained in any forward-looking statements. Except as otherwise
required by applicable laws, we undertake no obligation to publicly update or revise any forward-looking statements or the risk
factors described in this Annual Report, whether as a result of new information, future events, changed circumstances or any other
reason after the date of this Annual Report.

Not applicable.

See Index to Consolidated Financial Statements
on page F-1 of this Annual Report.

None.

Evaluation of Disclosure Controls and Procedures

(a)       Disclosure
Controls and Procedures

Our principal executive officer and principal
financial officer, with the assistance of other members of our management, have evaluated the effectiveness of our disclosure controls
and procedures, as defined in Rules 13a – 15(e) and 15d – 15(e) under the Securities Exchange Act of 1934, as amended
(the “Exchange Act”), as of the end of the period covered by this Annual Report. Based on such evaluation, our principal
executive officer and principal financial officer had concluded that our disclosure controls and procedures were not effective
due to material weaknesses in internal controls over financial reporting as identified below.

(b)       Management’s
Report on Internal Control over Financial Reporting

Our management is responsible for establishing
and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) and 15d-15(f) under the Exchange
Act). Our internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability
of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted
accounting principles. Our management evaluated the effectiveness of our internal control over financial reporting as of the end
of the period covered by this Annual Report. In making this assessment, our management used the criteria set forth by the Committee
of Sponsor Organizations of the Treadway Commission (COSO) in Internal Control-Integrated Framework (2013 framework). Based on
that evaluation, as a result of the material weaknesses described below, management has concluded that the Company’s internal
control over financial reporting was not effective as of December 31, 2020.

Although a material weakness identified
as of December 31, 2019 (the lack of sufficient independent directors on our Board to maintain audit and other committees consistent
with proper corporate governance standards) had been remediated as of December 31, 2020, management has determined that, as of
that date, there were still material weaknesses in both the design and effectiveness of our internal control over financial reporting.
A material weakness in internal controls is a deficiency in internal control, or combination of control deficiencies, that adversely
affects our ability to initiate, authorize, record, process, or report external financial data reliably in accordance with GAAP
such that there is more than a remote likelihood that a material misstatement of our annual or interim financial statements that
is more than inconsequential will not be prevented or detected. In the course of making our assessment of the effectiveness of
internal controls over financial reporting, we identified material weaknesses in our internal control over financial reporting.  Specifically,
we lack a sufficient number of employees to properly segregate duties and provide adequate monitoring during the process leading
to and including the preparation of the consolidated financial statements. Accordingly, management’s assessment is that the
Company’s internal controls over financial reporting were not effective as of December 31, 2020.

The Company anticipates that, prior to December 31, 2021, it
will be able to hire a sufficient number of employees to remediate the material weakness identified in the previous paragraph.

Changes in Internal Control over Financial
Reporting

We have worked to establish all the checks
and balances needed for all financial areas of our business. We hired a consultant in mid-2020 to establish best practices and
help us document and implement these. This consultant is a CPA and has a significant background in running the accounting and budgeting
process for public companies. We began adopting these best practices during the fourth quarter of 2020.

This Annual Report does not include an
attestation report of the Company’s independent registered public accounting firm regarding internal control over financial
reporting. Management’s report was not subject to attestation by the Company’s independent registered public accounting
firm pursuant to the rules of the SEC.

The following table provides information
regarding our executive officers and directors:

Executive Officers

Evan Sohn – Mr. Sohn has served
as our Chief Executive Officer since July 1, 2020 and our Chairman since April 2019. He served as Vice President of Sales at Veea
Inc., a company offering a platform-as-a-service (PaaS) platform for computing, mobile payment, point of sale, and retail solutions,
from April 2018 until June 2020 Prior to joining Veea Inc., from September 2015 to April 2018, Mr. Sohn served as the Vice President
of Sales at Poynt Inc., a company developing and marketing Poynt, a platform for next generation payments. Prior to that, from
April 2012 to September 2015, Mr. Sohn was the Vice President of Sales at VeriFone, Inc., a company designing, marketing, and servicing
electronic payment systems. Mr. Sohn is also the co-founder and Vice President of the Sohn Conference Foundation, a non-for-profit
dedicated to the treatment and cure of pediatric cancer and related childhood diseases. He is a graduate of the NYU Stern School
of Business with a degree in computer information systems and management.

Miles Jennings – Mr.
Jennings has served as the Company’s Chief Operating Officer and President since July 1, 2020. Prior to that, Mr. Jennings
founded the Company and served as the Chief Executive Officer of Recruiter.com, Inc. from 2015 until October 2017, and then as
Chief Executive Officer of Truli Technologies, Inc. and its subsidiary, VocaWorks, Inc., from then until March 31, 2019, when Truli
Technologies merged with Recruiter.com, Inc. Mr. Jennings served as Chief Executive Officer of the merged company, Recruiter.com
Group, Inc. through July 1, 2020, when he moved into the role of President and Chief Operating Officer. Mr. Jennings currently
serves on Recruiter.com’s Board. Mr. Jennings has worked in the recruiting and online recruiting industry since 2003 at employers
including Modis, an Adecco division, and Indeed.com. He is a graduate of Trinity College in Hartford, CT with a degree in Philosophy.

Judy Krandel, CFA – Ms. Krandel
has served as the Company’s Chief Financial Officer since June 25, 2020. From November 2016 until December 2019, she served
as Chief Financial Officer, and then Senior Business Development Consultant for PeerStream, Inc. From March 2012 until November
2016, Ms. Krandel was the Portfolio Manager for Juniper Investment Company, a small-cap hedge fund. Ms. Krandel spent the earlier
part of her career as an equity analyst and portfolio manager focusing on small-cap public equities. She currently also sits on
the board of directors of Lincoln First Bancorp, and served on the board of directors of Snap Interactive and Cynergistek in the
digital media and healthcare cybersecurity industries. She is a graduate of the Wharton School of Business of the University of
Pennsylvania with a degree in finance and the Booth School of Business of the University of Chicago with an MBA in finance and
accounting.

Rick Roberts – Mr. Roberts
has served as the President of Recruiting Solutions, a subsidiary of the Company, since April 2019. Mr. Roberts is also the founder
of Genesys, an artificial intelligence sourcing platform focusing on building proactive talent clouds for enterprise customers,
where he served as President from May 2016 through March 2019. Prior to that from September 2010 until May 2016, Mr. Roberts was
the President of Genuent, LLC, a staffing company focused on niche, high margin segments. He received a master’s degree in
Business and Education from Texas Tech University.

Ashley Saddul – Mr. Saddul
has served as our Chief Technology Officer since April 2019. Prior to his appointment, Mr. Saddul had served as the Chief Technology
Officer of Recruiter.com, since August 2010. He is a graduate of Murdoch University with a degree in computer science and mathematics.

Non-Employee Directors

Timothy O’Rourke – Mr.
O’Rourke has served on the Board since March 31, 2019. Mr. O’Rourke was designated by Genesys pursuant to the terms
of the Asset Purchase. Mr. O’Rourke has served as the Managing Director of Icon Information Consultants, LP (“Icon”),
a provider of human capital solutions, consulting, payroll and professional services, and a shareholder of Genesys, since February
2001. Mr. O’Rourke brings to the Board his experience and expertise in HR and recruitment solutions for employers. He is
a graduate of the University of Houston with a degree in electrical engineering.

Douglas Roth – Mr. Roth
has served on the Board since February 2018. Mr. Roth has been a Director and Investment Manager at Connecticut Innovations, Inc.
since 2011 and is responsible for sourcing new investment opportunities, serving on the boards of portfolio companies, and supporting
their growth and success. Mr. Roth was selected for appointment to the Board for his experience serving on the board of technology
companies and the skills he gained from previously advising companies regarding product development and launch. He is a graduate
of Boston University with an undergraduate degree in economics and mathematics as well as a master’s degree in electrical
engineering. He also has an MBA in Entrepreneurial and Strategic Management from the Wharton School of the University of Pennsylvania.

Wallace D. Ruiz – Mr.
Ruiz was appointed to the Board on May 24, 2018. Mr. Ruiz has served as the Chief Financial Officer of Inuvo, Inc. (NYSE: INUV),
an advertising technology company based in Little Rock, AR since June 2010. Mr. Ruiz was selected for appointment to the Board
for his experience with public companies as well as his accounting skills. Mr. Ruiz is a Certified Public Accountant in the State
of New York. He is a graduate of St. John’s University with a degree in computer science and Columbia University with a MBA
in finance and accounting.

Deborah S. Leff – Ms. Leff was
appointed to the Board on August 31, 2020. Ms. Leff has served as a Global Leader at IBM since October 2012 and most
recently held the position of Global Industry CTO for Data Science and AI. Ms. Leff was selected for appointment
to the Board for her experience with successfully implementing Artificial Intelligence and Machine Learning projects to drive strategic
outcomes. Ms. Leff has worked with Senior Leaders of Fortune 1000 companies to gain critical insights from data to drive
customer experience and optimize business operations. In addition, Ms. Leff has built and run global sales teams and
brings experience and expertise in Sales Management and Sales Execution. Ms. Leff is also the Founder of Girls Who Solve,
a STEM education program for high school girls that focuses on how Data Science and technology can be used to solve a range of
challenges in both for-profit and nonprofit organizations.

Family Relationships 

There are no family relationships among
our directors and/or executive officers.

Director Independence

Our Board has reviewed the materiality
of any relationship that each of our directors has with us, either directly or indirectly. Based on this review, our Board has
affirmatively determined that each of Leff, Roth, and Ruiz, current members of our Board, meets the independence requirements under
the Listing Rules of The Nasdaq Stock Market. LLC (the “Nasdaq Listing Rules”).

Board Committees

The Board currently has the following standing
committees: the Audit Committee, the Compensation Committee, and the Corporate Governance and Nominating Committee (the “Nominating
Committee”).

The following table identifies the independent
and non-independent current Board and committee members:

Board and Committee Meetings

During the year ended December 31, 2020,
the Board had four meetings, the Audit Committee had four meetings, the Compensation Committee had no meetings, and the Nominating
Committee had no meetings.

There were no directors (who were incumbent
at the time), who attended fewer than 75 percent of the aggregate total number of Board meetings and meetings of the Board committees
of which the director was a member during the applicable period.

Audit Committee

Management has the primary responsibility
for the financial statements and the reporting process, including the system of internal controls. The Audit Committee reviews
the Company’s financial reporting process on behalf of the Board and administers our engagement of the independent registered
public accounting firm. The Audit Committee meets with the independent registered public accounting firm, with and without management
present, to discuss the results of its examinations, the evaluations of our internal controls, and the overall quality of our financial
reporting.

Audit Committee Financial Expert

Our Board has determined that Mr. Ruiz
is qualified as an Audit Committee Financial Expert, as that term is defined under the rules of the Securities and Exchange Commission
(the “SEC”) and in compliance with the Sarbanes-Oxley Act.

Compensation Committee

The function of the Compensation Committee
is to determine the compensation of our executive officers. The Compensation Committee has the power to set performance targets
for determining annual bonuses payable to executive officers and may review and make recommendations with respect to stockholder
proposals related to compensation matters.

Nominating Committee

The responsibilities of the Nominating
Committee include the identification of individuals qualified to become Board members, the selection of nominees to stand for election
as directors, the oversight of the selection and composition of committees of the Board, establishing procedures for the nomination
process, oversight of possible conflicts of interests involving the Board and its members, developing corporate governance principles,
and the oversight of the evaluations of the Board and management. The Nominating Committee has not established a policy with regard
to the consideration of any candidates recommended by stockholders. If we receive any stockholder recommended nominations, the
Nominating Committee will carefully review the recommendation(s) and consider such recommendation(s) in good faith.

Board Diversity

While we do not have a formal policy on
diversity, our Board considers diversity to include the skill set, background, reputation, type and length of business experience
of our Board members as well as a particular nominee’s contributions to that mix. Our Board believes that diversity promotes
a variety of ideas, judgments and considerations to the benefit of our Company and stockholders. Although there are many other
factors, the Board primarily focuses on public company board experience, knowledge of the recruiting industry, or background in
finance or technology, and experience operating growing businesses.

Board Leadership Structure

Our Board has not adopted a formal policy
regarding the separation of the offices of Chief Executive Officer and Chairman of the Board. Rather, the Board believes that different
leadership structures may be appropriate for the Company at different times and under different circumstances, and it prefers flexibility
in making this decision based on its evaluation of the relevant facts at any given time.

Beginning in April 2019, following the
completion of the Merger and the appointment of Mr. Evan Sohn as our Executive Chairman, we separated the offices of Chief Executive
Officer and Chairman of the Board. In July 2020, Mr. Sohn was appointed as Chief Executive Officer and retained his position as
Chairman of the Board. Under our current Board leadership structure, the Chief Executive Officer is responsible for the day-to-day
leadership and performance of the Company. Mr. Miles Jennings, our Chief Operating Officer, focuses on allocation of resources,
our recruiting business and the Platform and products, while facilitating strategic communication and high-quality investor relations.

Board Role in Risk Oversight

Our Board bears responsibility for overseeing
our risk management function. Our management keeps the Board apprised of material risks and provides to directors access to all
information necessary for them to understand and evaluate the effect of these risks, individually or in the aggregate, on our business,
and how management addresses them. Our Executive Chairman works closely together with the Board once material risks are identified
on how to best address such risks. If the identified risks present an actual or potential conflict with management, our independent
directors may conduct the assessment.

Code of Ethics

Our Board has adopted a Code of Ethics
that applies to all of our employees, including our Executive Chairman, Chief Executive Officer, and Chief Financial Officer. Although
not required, the Code of Ethics also applies to our directors. The Code of Ethics provides written standards that we believe are
reasonably designed to deter wrongdoing and promote honest and ethical conduct, including the ethical handling of actual or apparent
conflicts of interest between personal and professional relationships, full, fair, accurate, timely and understandable disclosure
and compliance with laws, rules and regulations, including insider trading, corporate opportunities and whistleblowing or the prompt
reporting of illegal or unethical behavior. We will provide a copy of our Code of Ethics, without charge, upon request in writing
to Recruiter.com Group, Inc. at 100 Waugh Dr. Suite 300, Houston, Texas 77007, Attention: Corporate Secretary. 

Delinquent Section 16(a) Reports

Section 16(a) of the Exchange Act requires
the Company’s directors, executive officers, and persons who own more than 10{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} of the Company’s Common Stock to file
initial reports of ownership and changes in ownership of the Company’s Common Stock with the SEC. These individuals are required
by the regulations of the SEC to furnish us with copies of all Section 16(a) forms they file. Based solely on a review of the copies
of the forms furnished to us none of Company’s directors, executive officers, and persons who own more than 10{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} of the Company’s
Common Stock failed to comply with Section 16(a) filing requirements, except that one Form 4 for Mr. Miles Jennings, our Chief
Operating Officer, reporting his acquisition of shares of Series E Preferred Stock as consideration in the Merger and one Form
4 for Mr. Ashley Saddul, our Chief Technology Officer, reporting a grant of stock options were not timely filed due in each case
to an administrative error.

Communication with our Board

Although the Company does not have a formal
policy regarding communications with the Board, stockholders may communicate with the Board by writing to us at Recruiter.com Group,
Inc., 100 Waugh Dr. Suite 300, Houston, Texas 77007, Attention: Corporate Secretary. Shareholders who would like their submission
directed to a member of the Board may so specify, and the communication will be forwarded, as appropriate.

The following information is related to
the compensation paid, distributed or accrued by us for the years ended December 31, 2020 and December 31, 2019 for our Chief Executive
Officer (principal executive officer) serving during the year ended December 31, 2020 and the two other most highly compensated
executive officers serving at December 31, 2020 whose total compensation exceeded $100,000 (the “Named Executive Officers”).

Summary Compensation Table

Named Executive Officer Employment Agreements

Jennings Agreement

We entered into an employment agreement
with Miles Jennings, our former Chief Executive Officer and current Chief Operating Officer, effective October 31, 2017 (the “Jennings
Agreement”). The Jennings Agreement provides that he will serve as the Chief Executive Officer of the Company for a period
of one year, subject to an automatic renewal for successive one-year terms unless prior notice of non-renewal is given by either
party. Effective December 1, 2019, the Jennings Agreement was amended to increase Mr. Jennings’ annual base salary from $150,000
to $200,000.

Under the Jennings Agreement, Mr. Jennings
is entitled to severance in case of termination of employment. The termination provisions are intended to comply with Section 409A
of the Internal Revenue Code of 1986 (the “Code”) and the rules and regulations thereunder.

In the event of termination by the Company
without “cause” or resignation for “good reason,” Mr. Jennings is entitled to receive three months’
base salary, will have six months from the date of termination to exercise his outstanding stock options and continued benefits
for 12 months.

In case of termination or change in title
upon a change of control event, Mr. Jennings is entitled to receive six months’ base salary, immediate vesting of unvested
equity awards, which he will have the right to exercise within six months from the date of termination, and continued benefits
for 12 months.

“Change of Control” is defined
in the Jennings Agreement the same way it is defined under Section 409A of the Code. Generally, “good reason” is defined
as a material diminution in Mr. Jennings’ authority, duties or responsibilities due to no fault of his own (unless he has
agreed to such diminution); or (ii) any other action or inaction that constitutes a material breach by the Company under the Jennings
Agreement; or (iii) generally a relocation of the principal place of employment to a location outside of New York metropolitan
area.

Under the terms of his Jennings Agreement,
Mr. Jennings is subject to non-competition and non-solicitation covenants during the term of his employment and during one year
following termination of employment with the Company. The Jennings Agreement also contains customary confidentiality and non-disparagement
covenants.

Sohn Agreement

On June 18, 2020, the Board appointed Mr.
Evan Sohn as the Chief Executive Officer of the Company, effective immediately. Mr. Sohn will also continue to serve as the Chairman
of our Board. In connection with his appointment, on June 19, 2020 the Company entered into a one-year employment agreement (the
“Sohn Agreement”) with Mr. Sohn. Pursuant to the Sohn Agreement, Mr. Sohn will be paid an annual base salary of $200,000
and is entitled to earn a bonus of up to $200,000, $150,000 of which is based on the Company meeting the following milestones:
(i) $50,000 upon the listing of the Common Stock on the Nasdaq Capital Market or NYSE American, or any successor thereof (the “Uplisting”);
(ii) $50,000 upon a financing resulting in gross proceeds of at least $5,000,000; and (iii) $50,000 upon the Company first achieving
profitability on a quarterly basis during the term of the Employment Agreement. The remaining $50,000 of Mr. Sohn’s bonus
under the Sohn Agreement will be subject to the determination of the Board in its discretion.

In connection with his appointment, the
Board approved a grant to Mr. Sohn pursuant to the Sohn Agreement of 554,000 restricted stock units (the “RSUs”), subject
to and issuable upon the Uplisting. The RSUs will vest in equal quarterly installments over a two-year period from the date of
the Uplisting, subject to Mr. Sohn serving as an executive officer of the Company on each applicable vesting date. The RSUs will
be issued under the 2017 Plan.  

Krandel Consulting Agreement

In connection with her appointment, the
Company entered into a Consulting Agreement (the “Consulting Agreement”) with Ms. Krandel, effective June 1, 2020. The
initial term of the Consulting Agreement is six months, subject to a 12-month extension in the Company’s discretion. Pursuant
to the Agreement, as compensation for her services Ms. Krandel will receive a fixed fee of $5,000 per month. The Company also issued
to Ms. Krandel on the effective date of her appointment, five-year non-qualified options to purchase 26,087 shares of the Company’s
common stock at an exercise price per share at least equal to the closing price of the Company’s common stock on OTCQB as
of the trading day immediately preceding the effective date of her appointment (the “Initial Term Options”). The Initial
Term Options vest in six equal monthly installments on the last calendar day of each calendar month, with the first portion vesting
on May 31, 2020, subject to Ms. Krandel serving as the Chief Financial Officer of the Company on each applicable vesting date.
The Initial Term Options will vest in full upon the listing of the Company’s securities on NYSE American or the Nasdaq Capital
Market. The Company also agreed to issue to Ms. Krandel five-year non-qualified options to purchase 431,251 shares of the Company’s
common stock at an exercise price per share at least equal to the closing price of the Company’s common stock on OTCQB as
of the trading day immediately preceding the effective date of her appointment (the “Uplist Options”). The Uplist Options
will vest over a two-year period in equal quarterly installments on the last day of each calendar quarter, with the first portion
vesting on the last day of the calendar quarter during which the Company’s securities begin trading on NYSE American or the
Nasdaq Capital Market, subject to Ms. Krandel serving as the Chief Financial Officer of the Company on each applicable vesting
date. The Initial Term Options and the Uplist Options are to be issued under the Company’s 2017 Equity Incentive Plan.

The Krandel Consulting Agreement was amended
on January 7, 2021. The Consulting Agreement was extended for another 6 months from December 1, 2020 until May 31, 2021 unless
sooner terminated as a result of the uplist to a national exchange such as Nasdaq or NYSE. The monthly compensation was increased
to $13,350, the additional monthly compensation of $8,350 will be accrued and paid upon a successful uplist.

Software Development and Maintenance
Agreement

On January 17, 2020, we entered into a
Technology Services Agreement (the “Services Agreement”) with Recruiter.com (Mauritius) Ltd., a Mauritius private company
(“Recruiter.com Mauritius”) and a related party, for the provision of certain services to the Company, including software
development and maintenance related to the Company’s website and platform on an independent contractor basis. Recruiter.com
Mauritius had been providing software development services to Pre-Merger Recruiter.com since August 25, 2014 pursuant to an oral
agreement. Our Chief Technology Officer is an employee of, and exercises control over, Recruiter.com Mauritius. Recruiter.com Mauritius
was formed solely for the purpose of performing services to us and has no other clients.

Pursuant to the Services Agreement, the
Company has agreed to pay Recruiter.com Mauritius fees in the amount equal to the actualized documented costs incurred by Recruiter.com
Mauritius in rendering the services pursuant to the Services Agreement. We paid Recruiter.com Mauritius $235,444 in fees from January
1 through December 31, 2020 and $181,400 for 2019. As of December 31, 2020, we did not owe Recruiter.com Mauritius any fees.

The initial term of the Services Agreement
is five years, whereupon it shall automatically renew for additional successive 12-month terms until terminated by either party
by submitting a 90-day prior written notice of non-renewal. The Services Agreement may be terminated without cause by either party
upon prior written notice, which shall be a 15-day prior written notice if given by the Company and a 90-day prior written notice
if given by the Service Provider.

Executive Incentive Program

Performance Bonuses

Effective December 1, 2019, the Board approved
an executive cash incentive program for the 2019 and 2020 performance periods. Pursuant to the terms of the program, for each performance
period beginning January 1 and ending December 31, 2019 and 2020 (each a “Performance Period”), each of our executive
officers is eligible to earn a cash bonus in the amount of up to 100{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} of the maximum amount, such maximum amount ranging from $25,000
to $150,000, determined by the Compensation Committee for each such executive officer and respective performance period. The actual
amount of the cash incentive award to be received by each executive officer is determined by the Compensation Committee based on
the achievement by such executive officer of certain performance objectives set by the Compensation Committee, including the Company
achieving certain revenue thresholds, EBITDA, and the number on recruiters on our Platform. The actual amount of the cash incentive
award that each executive officer is entitled to receive is to be determined as a percentage of their respective maximum amounts
as follows:

The Compensation Committee has approved
the performance objectives for our executive officers for the 2019 and 2020 performance periods. Pursuant to the terms of the Cash
Incentive Program, (i) Mr. Jennings is eligible to receive up to $37,500 for the 2019 Performance Period and up to $50,000 for
the 2020 Performance Period if the Company reaches certain capital raising, revenue and network growth milestones; (ii) Mr. Sohn
is eligible to receive up to $37,500 for the 2019 Performance Period and up to $50,000 for the 2020 Performance Period if the Company
reaches certain capital raising milestones; (iii) Mr. Scherne is eligible to receive for each Performance Period up to $25,000
if the Company meets certain financial reporting and audit milestones; (iv) Mr. Saddul is eligible to receive up to $37,500 for
the 2019 Performance Period and up to up to $50,000 for the 2020 Performance Period if the Company meets certain operational, network
growth, and technological milestones; and (v) Mr. Roberts is eligible to receive up to $112,500 for the 2019 Performance Period
and up to $150,000 for the 2020 Performance Period if the Company meets certain revenue, operational and customer growth milestones.
The Company has met the network growth objective for the 2019 Performance Period, which entitled each of Miles Jennings and Ashley
Saddul to receive a cash award of $9,375. In 2020, the Company met financial reporting and audit milestones and Mr. Scherne earned
a bonus of $25,000. Mr. Roberts hit certain levels of his milestones and earned a bonus of $25,000.

Discretionary Equity Awards

The Compensation Committee has the authority
to grant discretionary equity awards to our executive officers, including our NSOs, under the 2017 Plan.

On May 14, 2020, the Compensation Committee
approved the following grants to Judy Krandel. 26,087 stock options to purchase shares of Common Stock, of the Company, at an exercise
price of $2.50. One-sixth of the stock options were vested upon grant and the balance vested in equal installments over the next
5 months. Judy Krandel also received a grant of 431,251 stock options which vest over a 2 year period in equal quarterly installments
on the last day of each calendar quarter, with the first portion vesting on the last day of the calendar quarter during which the
Company’s securities begin trading on NYSE American or the NASDAQ Capital Market, subject to the Consultant serving as the
Chief Financial Officer of the Company on each applicable vesting date. The stock options were granted under the Company’s
2017 Equity Incentive Plan.

On June 17, 2020, the Compensation Committee
approved a grant of 554,000 Restricted Stock Units to Evan Sohn subject to and issuable upon the listing of the Company’s
common stock on the NYSE American or the NASDAQ Capital Market. The RSUs vest over a 2 year period from the date of the Uplisting
in equal quarterly installments on the last day of the calendar quarter during which the Uplisting takes place, subject to Mr.
Sohn serving as an executive officer of the Company on each applicable vesting date, provided that the RSUs shall vest in full
immediately upon the termination of Mr. Sohn’s employment by the Company without cause (as defined in the employment agreement).

Outstanding Equity Awards at December 31, 2020

Listed below is information with respect
to unexercised options that have not vested, and equity incentive plan awards for each Named Executive Officer outstanding as of
December 31, 2020:

Outstanding Equity Awards At Fiscal Year-End

Compensation of Non-Employee Directors

We do not compensate employees for serving
as members of our Board. Our non-employee directors receive compensation for their service as directors and members of committees
of the Board, consisting of cash and equity awards. In December 2019, our Compensation Committee approved an annual retainer to
be paid to each non-employee director in the amount of $20,000 in cash. Directors are reimbursed for reasonable expenses incurred
in attending meetings and carrying out duties as board and committee members. Under the 2017 Plan, our non-employee directors receive
grants of stock options as compensation for their services on the Board.

On August 28, 2020, the Compensation Committee
approved an annual retainer in the amount of $20,000 cash and a grant of three-year stock options to Deborah Leff to purchase 50,000
shares of our Common Stock at an exercise price of $2.00 per share for serving on the Board. The options shall vest in equal quarterly
amounts beginning on the Effective Date and ending on the third anniversary of the Effective Date. On December 21, 2020, the Compensation
Committee approved a grant of three-year stock options to Robert Heath to purchase 50,000 shares of our Common Stock at an exercise
price of $2.50. Mr. Heath has not yet started his term as a Director. On December 23, 2019, the Compensation Committee approved
a grant to each of Timothy O’Rourke, Douglas Roth, and Wallace D. Ruiz, our non-employee directors, of three-year stock options
to purchase 47,668 shares of our Common Stock at an exercise price of $1.45 per share for serving on the Board. One-third of the
stock options were vested upon grant and the balance vest in equal annual installments on December 23, 2020 and December 23, 2021,
subject to continued service as members of the Board on each applicable vesting date. The stock options were granted under the
Company’s 2017 Equity Incentive Plan.

For the year ended 2020, our non-employee directors were compensated
as follows:

The table below sets forth the
unexercised stock options held by each of our non-employee directors outstanding as of December 31, 2020:

Except as specifically noted, the following table sets forth
information with respect to the beneficial ownership of our Common Stock as of March 4, 2021.

The calculations in the table below are based on 6,916,362 common
shares issued and outstanding.

Beneficial ownership is determined in accordance
with the rules and regulations of the SEC. In computing the number of shares beneficially owned by a person and the percentage
ownership of that person, we have included shares that the person has the right to acquire within 60 days, including through the
exercise of any option, warrant or other right or the conversion of any other security. These shares, however, are not included
in the computation of the percentage ownership of any other person.

Unless otherwise indicated, the address
for each beneficial owner listed in the table below is c/o Recruiter.com Group, Inc., 100 Waugh Dr. Suite 300, Houston, Texas,77007.

Securities Authorized for Issuance under
Equity Compensation Plans

The following table sets forth information
as of December 31, 2020 with respect to our compensation plans under which equity securities may be issued.

The following includes a summary of transactions
since July 1, 2017 to which we have been a party in which the amount involved exceeded or will exceed $120,000, and in which any
of our directors, executive officers or, to our knowledge, beneficial owners of more than 5{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} of our capital stock or any member
of the immediate family of any of the foregoing persons had or will have a direct or indirect material interest, other than equity
and other compensation, termination, change in control and other arrangements, which are described under “Executive and Director
Compensation.” We also describe below certain other transactions with our directors, executive officers and stockholders.

Director Agreement with Leff

We entered into a Director Agreement with Deborah Leff as a
director of the Company. The terms of the appointment of Leff were finalized on September 7, 2020 with her effective start date
on Octonber 1, 2020. In consideration of Ms. Leff’s agreement to join the Board, Ms. Leff shall receive an annual cash stipend
of $20,000, payable in equal quarterly installments of $5,000. In addition, Ms. Leff shall receive a grant of 50,000 Stock Options,
with an exercise price of $2.00, and which shall vest in equal amounts over a period of three years from the Effective Date, as
shall be determined by the Board, subject to her continued service on the Board through such vesting date. Upon the occurrence
of a Change in Control (as defined in the Company’s 2017 Equity Incentive Plan), any un-vested options shall vest immediately,
provided Ms. Leff serves on the Board as of the date of such Change in Control. The Stock Options will be issued under the Company’s
2017 Equity Incentive Plan (the “Plan”).

Merger with Recruiter.com, Inc.

In March 2019, we and Truli Acquisition
Co., Inc., our wholly-owned subsidiary (the “Merger Sub”) entered into an Agreement and Plan of Merger with Pre-Merger
Recruiter.com, pursuant to which the Merger Sub merged with and into Pre-Merger Recruiter.com, with Pre-Merger Recruiter.com continuing
as the surviving corporation and our wholly-owned subsidiary. Miles Jennings, our Chief Executive Officer, was the principal stockholder
and director of Pre-Merger Recruiter.com. As consideration in the merger, we issued a total of 775,000 shares of Series E with a
value of approximately $417,000 to the stockholders of the Pre-Merger Recruiter.com, including Mr. Jennings. We appointed Evan
Sohn as a special consultant to oversee the Merger and interface with the independent directors of the Company because of a conflict
of interest due to Mr. Jennings’ control of Pre-Merger Recruiter.com. See “Part I. Item 1. Business – March 31,
2019 Acquisitions” for more information. Mr. Sohn subsequently became Executive Chairman.

Cicero Investment in the March 2019
Private Placement

In April 2019, Cicero Transact Group US, Inc. (“Cicero”),
an entity controlled by Michael Woloshin, a principal stockholder of the Company purchased 13,750 units, with each unit consisting
of one share of Series D preferred stock and a warrant to purchase seven shares of our common stock, subject to adjustment as provided
for therein, in exchange for the delivery of common stock of a second company, with a market value of $240,000. Subsequently, the
Company determined that, because the Company was unable to realize the full value of the common stock of the second company, part
of the 13,750 units provided to Cicero, the percent of which could not be paid for, should be returned to the Company. On January
6, 2021, 8,755 units were returned to the Company.

Back Office, Accounting and EOR Services
Arrangements with Icon

Icon Information
Consultants performs all of the back office and accounting roles for Recruiting Solutions. Icon Information Consultants then charges
a fee for the services along with charging for office space. Icon Information Consultants and Icon Industrial Solutions (collectively
“Icon”) also provide “Employer of Record” (“EOR”) services to Recruiting Solutions which means
that they process all payroll and payroll tax related duties of temporary and contract employees placed at customer sites and is
then paid a reimbursement and fee from Recruiting Solutions. A representative of Icon is a member of our board of directors. Icon
Canada also acts as an EOR and collects the customer payments and remits the net fee back to Recruiting Solutions. Revenue related
to customers processed by Icon Canada is recognized on a gross basis the same as other revenues and was $140,642 and $208,158 for
the years ended December 31, 2020 and 2019, respectively. EOR costs related to customers processed by Icon Canada was $131,546
and $194,641 for the years ended December 31, 2020 and 2019, respectively. Currently, there is no intercompany agreement for
those charges and they are calculated on a best estimate basis. As of December 31, 2020, the Company owes Icon $706,515 in payables
and Icon Canada owes $19,143 (included in accounts receivable) to the Company. During the years ended December 31, 2020 and
2019, we charged to cost of revenue $1,232,359 and $1,887,726, respectively, related to services provided by Icon as our employer
of record for a total of $3,120,085 from March 31, 2019 through December 31, 2020. During the
year ended December 31, 2020, we charged to interest expense $12,276, related to finance charges on accounts payable owed
to Icon.

We paid Icon (including its entity affiliates) $80,040 in fees
and administrative expense for the period from March 31, 2019, the effective date of the Genesys Asset Purchase, through December
31, 2019 and $120,312 in fees and administrative expense for the year ended December 31, 2020, for a total of $200,352 in fees
and administrative expense from March 31, 2019 through December 31, 2020. The fees and charges are based upon a best estimate basis
rather than a formula.

We also recorded placement revenue from
Icon of $31,041 during the year ended December 31, 2020, of which $21,981 is included in accounts receivable at December 31,
2020.

Icon Sublease

Effective March 31, 2019, Recruiting Solutions, our wholly-owned
subsidiary, entered into a sublease agreement (the “Sublease Agreement”) with Icon, a significant stockholder. Pursuant
to the Sublease Agreement, Icon agreed to sublet to us office space in Houston, Texas and Recruiting Solutions agreed to pay rent
at a monthly rate of approximately $7,078 a month, subject to an immaterial annual increase. We paid Icon $111,689 in rent for
the period from March 31, 2019, the effective date of the Genesys Asset Purchase, through December 31, 2019 and $150,851 in rent
for the year ended December 31, 2020, for a total of $262,540 in rent through December 31, 2020. As of December 31, 2020, we have
a remaining minimum lease commitment to Icon of $194,542 under the Sublease Agreement. 

Genesys License Agreement

We are a party to that certain license
agreement covering Genesys’s software (which was licensed but not transferred to the Company in connection with the asset
purchase agreement with Genesys on March 31, 2019). An executive officer of Genesys, Tim O’Rourke, is a significant equity
holder and a member of our Board of directors. Pursuant to the License Agreement Genesys has granted us an exclusive license to
use certain candidate matching software and render certain related services to us. The Company has agreed to pay to Genesys a monthly
license fee of $5,000 beginning June 29, 2019 and an annual fee of $1,995 for each recruiter user being licensed under the License
Agreement, of which there have been nine. During the years ended December 31, 2020 and 2019, we charged to operating expenses $167,157
and $93,671, respectively, for services provided by Genesys. As of December 31, 2020, the Company owes Genesys $73,352 in
payables.

Woloshin Consulting Agreement

We are a party to a consulting agreement with Michael Woloshin,
a principal stockholder, entered into in January, 2019 (the “Consulting Agreement”). Pursuant to the Consulting Agreement,
Mr. Woloshin has agreed to act as the Company’s non-exclusive consultant with respect to introducing potential acquisition
and partnership targets, and we have agreed to pay the consultant a retainer of $10,000 per month as a non-recoverable draw against
any finder fees earned. The Company has also agreed to pay the consultant the sum of $5,500 per month for three years ($198,000
total) as a finder’s fee for introducing Genesys to the Company. This payment is included in the $10,000 monthly retainer
payment. We have recorded consulting fees expense of $54,000 and $238,500 during the years ended December 31, 2020 and 2019,
respectively. At December 30, 2020, $104,500 of the Genesys finder’s fee and $18,000 of monthly fee expense is included
in accrued compensation. In April 2019, Michael Woloshin forgave accrued fees due to him in the amount of $187,500. This amount
has been credited to paid-in capital of the Company.

Recruiter.com Mauritius

We use a related party firm of the Company, for software development and
maintenance related to our website and the platform underlying our operations. The firm was formed outside of the United States
solely for the purpose of performing services for the Company and has no other clients. Our Chief Technology Officer is an employee
of this firm and exerts control over the firm. Payments to this firm were $235,444 and $181,400 for the years ended December 31,
2020 and 2019, respectively.

Cicero Marketing Partnership Agreement

We are a party to a marketing partnership agreement (the “Marketing
Agreement”), entered into in September 2018, between pre-Merger Recruiter.com and Cicero Consulting Group LLC, an entity
controlled by Michael Woloshin, a principal stockholder. The Marketing Agreement provides for payment by us of a fee for the use
of a certain database for marketing purposes in the amount of 10{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} of gross revenue generated through the use of the database. The
Marketing Agreement also provides for a fee payable to us in the amount of 10{14cc2b5881a050199a960a1a3483042b446231310e72f0dc471a7a1eddd6b0c3} of the revenue generated by Cicero using our social
media groups for marketing. We did not incur any fees to Cicero for 2020 or 2019 under the Marketing Agreement and did not earn
any fees for 2020 or 2019 from Cicero under the Marketing Agreement.

Cicero Investment in the March 2019
Private Placement

In April 2019, Cicero Transact Group US,
Inc. (“Cicero”), an entity controlled by Michael Woloshin, purchased 13,750 units, with each unit consisting of one
share of Series D preferred stock and a warrant to purchase seven shares of our common stock, subject to adjustment as provided
for therein, in exchange for the delivery of common stock of a second company, with a market value of $240,000. Subsequently, the
Company determined that, because the Company was unable to realize the full value of the common stock of the second company, part
of the 13,750 units provided to Cicero, the percent of which could not be paid for, should be returned to the Company. On January
6, 2021, 8,755 units were returned to the Company.

Recruiter.com License

In connection with the closing of the Merger,
we amended the License Agreement, dated October 30, 2017 (the “License”) between Pre-Merger Recruiter.com and VocaWorks,
Inc., our newly created wholly-owned subsidiary, to terminate the right of Pre-Merger Recruiter.com to receive shares of Series
B, Series B were subsequently cancelled and returned to the status of our undesignated preferred stock. In March 2019, Pre-Merger
Recruiter.com distributed to its stockholders the 1,562,500 shares of our Common Stock, previously acquired pursuant to the License.

See Note 13 to our consolidated financial statements included
in this Annual Report for further information on these related party transactions.

The following table provides detail about fees for professional
services rendered to us by Salberg & Company, P.A., our independent registered public accounting firm engaged to provide accounting
services for the fiscal year ended December 31, 2020 and 2019.

Policy on Pre-Approval of Audit and
Permissible Non-audit Services of Independent Auditors

Consistent with the SEC policies regarding
auditor independence, our Board has responsibility for appointing, setting compensation and overseeing the work of the independent
auditor. In recognition of this responsibility, our Board has established a policy to pre-approve all audit and permissible non-audit
services provided by the independent auditor.

Prior to engagement of the independent
auditor for the next year’s audit, management will submit an aggregate of services expected to be rendered during that year
for each of the following four categories of services to the Board for approval.