What changed in this filing

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Item 1A. Risk Factors

2024-09-30 compared with 2023-09-28 · 159 added, 84 removed, 105 unchanged (70% of the section changed)

RISK FACTORS.

The following risk factors

do not purport to be a complete explanation of the risks involved in our business.

The following risk factors do

not purport to be a complete explanation of the risks involved in our business.

WE MAY NEED ADDITIONAL FINANCING

FOR PRODUCT DEVELOPMENT.

Our financial resources are sufficient for our current operational needs, however, the amount of funding required

Our financial resources are sufficient for our current operational needs;

however, the amount of funding required

to develop and commercialize our products and technologies is highly uncertain.

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We may be prohibited from further use of the intellectual property and may be required to cease selling our products that are subject to the claim;

We may have to license the third-party intellectual property, incurring royalty fees that may or may not be on commercially reasonable terms.

We may have to license third-party intellectual property, incurring royalty fees that may or may not be on commercially reasonable terms.

In addition, there is no assurance that we will be able to successfully negotiate and obtain such a license from the third party;

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our business, operating results and financial condition may be materially adversely affected and we may have to restructure our business.

Absent a specific claim for

infringement of intellectual property, from time to time we have and expect to continue to license technology, intellectual property,

and software from third parties.

There is no assurance that we will be able to maintain our third-party licenses or obtain new licenses

when required and this inability could materially adversely affect our business and operating results and the quality and functionality

of our products.

Absent a specific claim for infringement

of intellectual property, from time to time we have and expect to continue to license technology, intellectual property, and software

from third parties.

There is no assurance that we will be able to maintain our third-party licenses or obtain new licenses when required

and this inability could materially adversely affect our business and operating results and the quality and functionality of our products.

In addition, there is no assurance that third party licenses we execute will be on commercially reasonable terms.

Under purchase orders and

contracts for the sale of our products we may provide indemnification to our customers for potential intellectual property infringement

claims for which we may have no corresponding recourse against our third-party licensors.

This potential liability, if realized, could

materially adversely affect our business, operating results, and financial condition.

WE OPERATE IN AN INTENSIVELY

COMPETITIVE MARKET.

Under purchase orders and contracts

for the sale of our products we may provide indemnification to our customers for potential intellectual property infringement claims for

which we may have no corresponding recourse against our third-party licensors.

This potential liability, if realized, could materially

adversely affect our business, operating results, and financial condition.

WE OPERATE IN AN INTENSIVELY COMPETITIVE

The wireless broadband data access market is highly competitive, and we may be unable to compete effectively.

of our competitors or potential competitors have significantly greater financial, technical, and marketing resources than we do.

and be competitive, we will need to continuously invest in research and development, sales and marketing, and customer support.

competition could result in price reductions, and smaller customer orders.

Our failure to compete effectively could seriously impair our

WE OPERATE IN THE HIGH-RISK

TELECOM SECTOR.

Many of our competitors

or potential competitors have significantly greater financial, technical, and marketing resources than we do.

To survive and be competitive,

we will need to continuously invest in research and development, sales and marketing, and customer support.

Increased competition could

result in price reductions, and smaller customer orders.

Our failure to compete effectively could seriously impair our business.

WE OPERATE IN THE HIGH-RISK TELECOM

We are in a volatile industry.

In addition, our revenue model is evolving and relies substantially on the assumption that

we will be able to successfully complete the development and sales of our products and services in the marketplace.

Our prospects must

be considered in the light of the risk, uncertainties, expenses, and difficulties frequently encountered by companies in the early stages

of development and marketing new products.

In addition, our revenue model is evolving and relies substantially on the assumption that we will

be able to successfully complete the development and sales of our products and services in the marketplace.

Our prospects must be considered

in the light of the risk, uncertainties, expenses, and difficulties frequently encountered by companies in the early stages of development

and marketing of new products.

To be successful in the market we must, among other things:

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Attract, retain, and motivate qualified personnel.

We cannot guarantee that we

will be able to achieve these goals, and our failure to achieve them could adversely affect our business, results of operations, and financial

We cannot guarantee that we will

be able to achieve these goals, and our failure to achieve them could adversely affect our business, results of operations, and financial

We expect that revenues and operating results will fluctuate in the future.

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will produce a successful outcome.

WE OPERATE IN THE HIGH-RISK

HARDWARE DESIGN INDUSTRY.

WE OPERATE IN THE HIGH-RISK HARDWARE

DESIGN INDUSTRY.

We are in a volatile industry.

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Manufacturing defects and flaws will occur during device production.

WE OPERATE IN THE HIGH-RISK

SOFTWARE INDUSTRY.

WE OPERATE IN THE HIGH-RISK SOFTWARE

This industry has numerous and significant known risks.

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intangible assets, and significant warranty and other expenses, including litigation costs and regulatory fines.

WE OPERATE IN A FIELD WITH

RAPIDLY CHANGING TECHNOLOGY.

WE OPERATE IN A FIELD WITH RAPIDLY

CHANGING TECHNOLOGY.

We cannot be certain that our products and services will function as anticipated or be desirable to our intended

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products on time, we may lose customers and potential product orders.

WE DEPEND ON THE DEMAND FOR

WIRELESS NETWORK CAPACITY.

WE DEPEND ON THE DEMAND FOR WIRELESS

NETWORK CAPACITY.

The demand for our products is completely dependent on the demand for broadband wireless access to networks.

If wireless operators do not deliver acceptable wireless service, our product sales may dramatically decline.

Thus, if wireless operators

experience financial or network difficulties, it will likely reduce demand for our products.

These are beyond our ability to control and

can either increase or decrease demand for our products.

PANDEMIC OUTBREAKS CAN CAUSE

VOLATILE CHANGES IN THE MARKET.

Demand for wireless access can rise and fall greatly during times of pandemic outbreaks, such as COVID-19,

as more people may be required to work remotely, and schools may be required to operate remote classrooms.

When an outbreak ends, or becomes

more controlled, demand for wireless devices could decline rapidly, decreasing demand for our products.

operators do not deliver acceptable wireless service, our product sales may dramatically decline.

Thus, if wireless operators experience

financial or network difficulties, it will likely reduce demand for our products.

These are beyond our ability to control and can either

increase or decrease demand for our products.

PANDEMIC OUTBREAKS CAN CAUSE VOLATILE

CHANGES IN THE MARKET.

Demand for wireless access can rise and fall greatly during times of pandemic outbreaks, such as COVID-19, as more

people may be required to work remotely, and schools may be required to operate remote classrooms.

When an outbreak ends, or becomes more

controlled, demand for wireless devices could decline rapidly, decreasing demand for our products.

Pandemic outbreaks can also disrupt

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All these changes are beyond our ability to control and can cause revenue and income to change dramatically.

WE DEPEND ON COLLABORATIVE

ARRANGEMENTS.

The development and commercialization of our products and services depend in large part upon our ability to selectively

enter and maintain collaborative arrangements with developers, distributors, service providers, network systems providers, core wireless

communications technology providers and manufacturers, among others.

THE LOSS OF ANY OF OUR MATERIAL

CUSTOMERS COULD ADVERSELY AFFECT OUR REVENUES AND PROFITABILITY, AND THEREFORE SHAREHOLDER VALUE.

We depend on a small number of customers

for a significant portion of our revenues.

For the year ended June 30, 2023, net revenues from our two largest customers represented 61%

and 31% of our consolidated net sales, respectively.

We have a written agreement with each of these customers that governs the

sale of products to them, but the agreements do not obligate them to purchase any quantity of products from us.

If these customers were

to reduce their business with us, our revenues and profitability could materially decline.

WE DEPEND ON COLLABORATIVE ARRANGEMENTS.

The development and commercialization of our products and services depend in large part upon our ability to selectively enter and maintain

collaborative arrangements with developers, distributors, service providers, network systems providers, core wireless communications technology

providers and manufacturers, among others.

THE LOSS OF ANY OF OUR

MATERIAL CUSTOMERS COULD ADVERSELY AFFECT OUR REVENUES AND PROFITABILITY, AND THEREFORE SHAREHOLDER VALUE.

We depend on a small

number of customers for a significant portion of our revenues.

For the year ended June 30, 2024, net revenues from our two largest

customers represented 68% and 23% of our consolidated net sales, respectively.

We have a written agreement with each of these

customers that governs the sale of products to them, but the agreements do not obligate them to purchase any quantity of

products from us.

If these customers were to reduce their business with us, our revenues and profitability could materially

OUR PRODUCT DELIVERIES ARE

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We often experience long lead times to ship products, often more than 45 days.

This could cause us to lose

customers, who may be able to secure faster delivery times from our competitors and require us to maintain higher levels of working capital.

This could cause us to

lose customers, who may be able to secure faster delivery times from our competitors and require us to maintain higher levels of

working capital.

OUR PRODUCT-TO-MARKET CHALLENGE

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Potential adverse tax consequences.

Furthermore, if we are unable to further develop

distribution channels in countries in North America, the Caribbean and South America, EMEA (Europe, the Middle East and Africa), and Asia,

we may not be able to grow our international operations, and our ability to increase our revenue will be negatively impacted.

We believe that our products

are currently exempt from international tariffs.

If this were to change at any point, a tariff of 10%-25% of the purchase price could

Furthermore, if we are unable

to further develop distribution channels in countries in North America, the Caribbean and South America, EMEA (Europe, the Middle East

and Africa), and Asia, we may not be able to grow our international operations, and our ability to increase our revenue will be negatively

We believe that our products are

currently exempt from international tariffs.

If this were to change at any point, a tariff of 10%-25% of the purchase price could be imposed.

If such tariffs are imposed, they could have a materially adverse effect on sales and operating results.

GOVERNMENT REGULATION COULD

RESULT IN INCREASED COSTS AND INABILITY TO SELL OUR PRODUCTS.

Our products are subject to certain mandatory regulatory approvals in the

United States and other regions in which we operate.

In the United States, the Federal Communications Commission regulates many aspects

of communications devices.

Although we have obtained all the necessary Federal Communications Commission and other required approvals

for the products we currently sell, we may not obtain approvals for future products on a timely basis, or at all.

In addition, regulatory

requirements may change, or we may not be able to obtain regulatory approvals from countries other than the United States in which we

may desire to sell products in the future.

UNRESOLVED STAFF COMMENTS

GOVERNMENT REGULATION COULD RESULT

IN INCREASED COSTS AND INABILITY TO SELL OUR PRODUCTS.

Our products are subject to certain mandatory regulatory approvals in the United

States and other regions in which we operate.

In the United States, the Federal Communications Commission regulates many aspects of communications

Although we have obtained all the necessary Federal Communications Commission and other required approvals for the products we

currently sell, we may not obtain approvals for future products on a timely basis, or at all.

In addition, regulatory requirements may

change, or we may not be able to obtain regulatory approvals from countries other than the United States in which we may desire to sell

products in the future.

EVENTS THAT COULD REDUCE OR IMPAIR

OUR ABILITY TO GENERATE REVENUES.

o The marketability of our products may suffer if wireless telecommunications operators do not deliver acceptable wireless services.

o If customers do not adopt our software, we may not be able to monetize these software assets and realize a key part of our growth

and profitability strategy.

o The market for the products and services that we offer is rapidly evolving and highly competitive.

We may be unable to compete effectively.

o If we fail to develop and maintain strategic relationships, we may not be able to penetrate new markets.

o If we fail to develop and timely introduce new products and services or enter new markets for our products and services successfully,

we may not achieve our revenue targets, or we may lose key customers or sales, and our business could be harmed.

EVENTS THAT COULD IMPAIR OUR ABILITY TO

DEVELOP, MANUFACTURE AND DELIVER OUR SOLUTIONS.

o We rely on third parties to manufacture and warehouse many of our products, which exposes us to a number of risks and uncertainties

outside our control.

o We depend on sole source suppliers for some components used in our products.

The availability and sale of those services would be

harmed if any of these suppliers is not able to meet our demand and alternative suitable products are not available on acceptable terms,

o Natural disasters, public health crises, political crises and other catastrophic events or other events outside of our control could

damage our facilities or the facilities of third parties on which we depend, and could impact consumer spending.

o If disruptions in our transportation network occur or our shipping costs substantially increase, we may be unable to sell or timely

deliver our products, and our operating expenses could increase.

o We may be unable to adequately control the costs or maintain adequate supply of components and raw materials associated with our operations.

o If we do not effectively manage our sales channel inventory and product mix, we may incur costs associated with excess inventory or

lose sales from having too few products.

o Product liability, product replacement or recall costs could adversely affect our business and financial performance.

o We rely on third-party software and other intellectual property to develop and provide our solutions and significant increases in

licensing costs or defects in third-party software could harm our business.

o Our solutions integrate with third-party technologies and if our solutions become incompatible with these technologies, our solutions

would lose functionality, and our customer acquisition and retention could be adversely affected.

LEGAL AND REGULATORY CHANGES THAT COULD

REDUCE OR IMPAIR OUR ABILITY TO OPERATE.

o Evolving regulations and changes in applicable laws relating to data privacy may increase our expenditures related to compliance efforts

or otherwise limit the solutions we can offer, which may harm our business and adversely affect our financial condition.

o Enhanced United States fiscal, tax and trade restrictions and executive and legislative actions could adversely affect our business,

financial condition, and results of operations.

o The increasing focus on environmental sustainability and social initiatives could increase our costs, harm our reputation and adversely

impact our financial results.

o An assertion by a third party that we are infringing its intellectual property could subject us to costly and time-consuming litigation

or expensive licenses and our business could be harmed.

o If we are unable to protect our intellectual property and proprietary rights, our competitive position and our business could be harmed.

POTENTIAL NEGATIVE IMPACTS RELATED TO INTERNATIONAL

o Due to the global nature of our operations, we are subject to political and economic risks of doing business internationally.

o Weakness or deterioration in global economic conditions or jurisdictions where we have significant foreign operations could have a

material adverse effect on our results of operations and financial condition.

o Weakness or deterioration in global political conditions where we have significant business interests could have a material adverse

effect on our business, results of operations and financial condition.

o Fluctuations in foreign currency exchange rates could adversely affect our results of operations.

o Unionization efforts in certain countries in which we operate could materially increase our costs or limit our flexibility.

o Our international operations may increase our exposure to potential liability under anti-corruption, trade protection, tax and other

laws and regulations.

o A governmental challenge to our transfer pricing policies or practices could impose significant costs on us.

EVENTS THAT COULD HARM BUSINESS DEVELOPMENT ACTIVITIES AND

IMPAIR OR REDUCE REVENUE.

o We may acquire companies and businesses, and/or divest assets or businesses.

The completion of acquisition or divestiture transactions

could have an adverse effect on our financial condition.

o If our goodwill and acquired intangible assets become impaired, we may be required to record a significant charge to earnings.

POTENTIAL EVENTS THAT COULD NEGATIVELY IMPACT

THE VALUE OF OUR SECURITIES.

o Our share price has been highly volatile in the past and could be highly volatile in the future.

o Our ability to use our net operating loss carryforwards and certain other tax attributes may be limited

o The price of our stock may be vulnerable to manipulation, including through short sales.

o Ownership of our common stock is concentrated, and as a result, certain stockholders may exercise significant influence over the Company.

o We do not currently intend to pay dividends on our common stock, and, consequently, your ability to achieve a return on your investment

will depend on appreciation, if any, in the price of our common stock.

o If financial or industry analysts do not publish research or reports about our business, or if they issue negative or misleading evaluations

of our stock, our stock price and trading volume could decline.

o If we fail to maintain an effective system of internal controls over financial reporting, we may not be able to report our financial

results timely and accurately, which could adversely affect investor confidence in us, and in turn, our results of operations and our

o If the accounting estimates we make, and the assumptions on which we rely, in preparing our financial statements prove inaccurate,

our actual results may be adversely affected.

o Changes to the accounting systems or new accounting system implementations may be ineffective or cause delays in our ability to record

transactions and/or provide timely financial results.

o Any changes to existing accounting pronouncements or taxation rules or practices may cause adverse fluctuations in our reported results

of operations or affect how we conduct our business.

o Our quarterly operating results have fluctuated in the past and may fluctuate in the future, which could cause declines or volatility

in the price of our common stock.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors