Item 1A. Risk Factors
Item 1A.
Risk Factors.
During the reporting period covered by this Quarterly Report on Form 10-Q, there have been no material changes to our risk factors as set forth in the 2022
10-K, except as follows:
The terms of Convertible Notes could limit our growth and our ability to finance our operations, fund our
capital needs, respond to changing conditions and engage in other business activities that may be in our best interests.
The Convertible Notes contain a number of restrictive covenants that, among other things, generally limit the ability of the
Company and its subsidiaries to create liens, pay dividends, acquire shares of capital stock and make payments on subordinated debt, incur indebtedness, or enter into transactions with affiliates.
Our ability to comply with these covenants may be adversely affected by events beyond our control, and we cannot assure you that
we can maintain compliance with these covenants. The financial covenants could limit our ability to make needed expenditures or otherwise conduct necessary or desirable business activities.
The requirement that we redeem the Convertible Notes in cash could adversely affect our business plan,
liquidity, financial condition, and results of operations.
If not converted, we are required to redeem some or all of the principal on the Convertible Notes for cash under certain
circumstances. These obligations could have important consequences on our business. In particular, they could:
•
limit our flexibility in planning for, or reacting to, changes in our businesses and the industries in which we operate;
•
increase our vulnerability to general adverse economic and industry conditions; and
•
place us at a competitive disadvantage compared to our competitors.
No assurances can be given that we will be successful in making the required payments to the holders of the Convertible Notes or
that we will be able to comply with the financial or other covenants contained in the Convertible Notes. If we are unable to make the required cash payments or otherwise comply with Convertible Notes:
•
the holders of the Convertible Notes may require us to repurchase some or all of their Convertible Notes at a price equal to 100% of the
principal amount being repurchased, plus accrued and unpaid interest;
•
the holders of the Convertible Notes could foreclose against our assets; and/or
•
we could be forced into bankruptcy or liquidation.
Item 2.
Unregistered Sales of Equity Securities and Use of Proceeds.
None
Item 3.
Defaults Upon Senior Securities.
None.
Item 4.
Mine Safety Disclosures.
Not Applicable.
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