8 unchanged sentences
Further, we cannot assess the impact of each such factor on our results of operations or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.
−Removed: Summary of Risk Factors
Risks Related to Our Business Generally
−Removed: We have a history of net losses, and we are uncertain about our future profitability.
−Removed: Supply chain and shipping disruptions have resulted in shipping delays, a significant increase in shipping costs, and could increase product costs and result in lost sales, which may have a material adverse effect on our business, operating results and financial condition.
−Removed: Our dependence on key suppliers puts us at risk of interruptions in the availability of our products, which could reduce our revenue and adversely affect the results of operations.
−Removed: Unfavorable global economic conditions have in the past and could in the future adversely affect our business, financial condition or results of operations.
−Removed: We may need to raise additional capital to grow our business and satisfy our anticipated future liquidity needs, and we may not be able to raise it on terms acceptable to us, or at all.
−Removed: Sustained investment in our business, strategic acquisitions and investments, as well as our focus on long-term performance, and on maintaining the health of our new e-commerce ecosystem, may negatively affect our margins and our net income, if any.
−Removed: The concentration of ownership by our principal stockholders may result in control by such stockholders of the composition of our board of directors.
−Removed: We will become subject to a broad range of laws and regulations, and future laws and regulations may impose additional requirements and other obligations that could materially and adversely affect our business, financial condition and results of operations, as well as the trading prices of our securities.
−Removed: If we are successful in implementing our business strategy we will generate and process a large amount of data, including personal data, and the improper use or disclosure of data could result in regulatory investigations and penalties, and harm our reputation and have a material adverse effect on the trading prices of our securities, our business and our prospects.
−Removed: Our operations in international markets, and earnings in those markets, may be affected by changes in global cultural, political, and financial market conditions as well as potential changes in regulation, legislation, and government policies such as tariffs, tax laws, and global trade policies.
−Removed: Risks Related to Our e-Commerce Business
−Removed: Our sales may be impacted should there be a disruption of service to our Amazon or Alibaba online storefronts.
−Removed: Creating and maintaining a trusted status of our online marketing presence or ecosystem will be critical to our viability and growth.
−Removed: Any termination or material change in our relationship with Amazon or Alibaba could have a material adverse effect on our business, financial condition, results of operations and prospects.
−Removed: We may not be able to maintain and improve our online marketing.
−Removed: We face challenges in expanding our international and cross-border businesses and operations.
−Removed: We are heavily reliant on the services of certain executive officers and the departure or loss of any of these officers could disrupt our business.
−Removed: A significant portion of our revenues are from sales of products on Amazon and any limitation or restriction, temporarily or otherwise, to sell on Amazon’s platform could have a material adverse impact to our business, results of operations, financial condition and prospects.
−Removed: If logistics service providers used by our merchants fail to provide reliable logistics services, our business and prospects, as well as our financial condition and results of operations, may be materially and adversely affected.
−Removed: Our e-commerce platforms could be disrupted by network interruptions.
−Removed: Security breaches and attacks against our systems and network, and any potentially resulting breach or failure to otherwise protect personal, confidential and proprietary information, could damage our reputation and negatively impact our business, as well as materially and adversely affect our financial condition and results of operations.
−Removed: Non-compliance with, or changes in, the legal and regulatory environment in the countries in which we operate could increase our costs or reduce our net operating revenues.
−Removed: Tightening of tax compliance efforts that affect our merchants could materially and adversely affect our business, financial condition and results of operations.
−Removed: Risks Related to Doing Business in China
−Removed: Changes in China’s economic, political or social conditions or government policies could have a material adverse effect on our business, financial conditions and results of operations.
−Removed: Uncertainties with respect to China’s PRC legal system could adversely affect us.
−Removed: Recent litigation and negative publicity surrounding China-based companies listed in the United States may negatively impact the trading price of our securities.
−Removed: Fluctuations in exchange rates could have a material and adverse effect on the results of operations and the value of your investment.
−Removed: Governmental control of currency conversion may limit our ability to utilize our revenues effectively and affect the value of your investment.
−Removed: Risks Related to Our Healthcare Business
−Removed: We derive a significant portion of our sales from prescription drug sales reimbursed by pharmacy benefit management companies.
−Removed: Efforts to reduce reimbursement levels and alter health care financing practices could adversely affect our businesses.
−Removed: A slowdown in the frequency and rate of the introduction of new prescription drugs as well as generic alternatives to brand name prescription products could adversely affect our business, financial position, and results of operations.
−Removed: Unexpected safety or efficacy concerns may arise from pharmaceutical products.
−Removed: Prescription volumes may decline, and our net revenues and ability to generate earnings may be negatively impacted, if products are withdrawn from the market or if increased safety risk profiles of specific drugs result in utilization decreases.
−Removed: Certain risks are inherent in providing pharmacy services;
−Removed: our insurance may not be adequate to cover any claims against us.
−Removed: Changes in industry pricing benchmarks could adversely affect our business, financial position and results of operations.
−Removed: The industries in which we operate are extremely competitive and competition could adversely affect our business, financial position and results of operations.
−Removed: Existing and new government legislative and regulatory action could adversely affect our business, financial position and results of operations.
−Removed: Changes in the health care regulatory environment may adversely affect our business.
−Removed: Efforts to reform the U.S.
−Removed: health care system may adversely affect our financial performance.
−Removed: If we are found to be in violation of Medicaid and Medicare reimbursement regulations, we could become subject to retroactive adjustments and recoupment, or exclusion from the Medicaid, Medicare programs, and PBM networks.
−Removed: Our industry is subject to extensive government regulation, and noncompliance by us or our suppliers could harm our business.
−Removed: Our operating results are affected by the health of the economy in general and the markets we serve.
−Removed: If the products and services that we offer fail to meet customer needs, our sales may be affected.
−Removed: We are highly dependent on one supplier for our products, and a loss of that supplier may adversely impact our ability to sell products to our customers.
−Removed: We derive a significant portion of our revenues from a small number of customers and a loss of one or both of those customers would have a material adverse impact on our business.
−Removed: Our ability to grow our business may be constrained by our inability to find suitable new pharmacy locations at acceptable prices.
−Removed: Our ability to grow our business may be constrained by our inability to obtain adequate permits and licensing for new locations, business lines, and market territories.
−Removed: Product liability, product recall or personal injury issues could damage our reputation and have a significant adverse effect on our businesses, operating results, cash flows and/or financial condition.
−Removed: If we are not able to market our services effectively to clinics, their affiliated healthcare providers and prescription drug providers, we may not be able to grow our patient base as rapidly as we have anticipated.
−Removed: A disruption in our telephone system or our computer system could harm our business.
−Removed: Risks Related to the Pharmacy Industry
−Removed: There is substantial competition in our industry, and we may not be able to compete successfully.
−Removed: If demand for our products and services is reduced, our business and ability to grow would be harmed.
−Removed: Our revenues could be adversely affected if new drugs or combination therapies are developed and prescribed to our patients that have a reimbursement rate less than that of the current drug therapies our patients receive.
−Removed: If our credit terms with vendors become unfavorable or our relationship with them is terminated, our business could be adversely affected.
−Removed: Risks Relating to Our Data Management Services
−Removed: Competition with some customers, or decisions by customers to perform internally some of the same solutions or services that we offer, could harm our business, results of operations or financial condition.
−Removed: If our solutions do not interoperate with our customers’ or their vendors’ networks and infrastructures, or if customers or their vendors implement new system updates that are incompatible with our solutions, sales of those solutions could be adversely affected.
−Removed: Our ability to generate revenue could suffer if we do not continue to update and improve existing solutions and develop new ones.
−Removed: There are increased risks of performance problems and breaches during times when we are making significant changes to our solutions or systems we use to provide our solutions.
−Removed: In addition, changes to our solutions or systems, including cost savings initiatives, may cost more than anticipated, may not provide the benefits expected, may take longer than anticipated to develop and implement or may increase the risk of performance problems.
−Removed: Breaches and failures of our IT systems and the security measures protecting them, and the sensitive information we transmit, use and store, expose us to potential liability and reputational harm.
−Removed: We collect, process, store, share, disclose and use personal information and other data, and our actual or perceived failure to protect such information and data could damage our reputation and brand and harm our business and operating results.
−Removed: If we are unable to successfully execute on cross-selling opportunities of our solutions the growth of our business and financial performance could be harmed.
−Removed: We rely on internet infrastructure, bandwidth providers, other third parties and our own systems in providing certain of our solutions to our customers, and any failure or interruption in the services provided by these third parties or our own systems could negatively impact our relationships with customers, adversely affecting our brand and our business.
−Removed: Risks Related to Our Business
−Removed: We have a history of net losses, and we are uncertain about our future profitability.
−Removed: We have incurred significant net losses since our inception.
−Removed: For the years ended December 31, 2024, and 2023, we have incurred net losses of approximately $23.1 million, and $12.4 million, respectively.
−Removed: As of December 31, 2024, we had an accumulated deficit of approximately $49.0 million.
−Removed: If our revenue grows more slowly than currently anticipated, or if operating expenses are higher than expected, we may be unable to consistently achieve profitability, our financial condition will suffer, and the value of our common stock could decline.
−Removed: Even if we are successful in increasing our sales, we may incur losses in the foreseeable future as we continue to develop and market our products.
−Removed: If sales revenue from any of our current products or any additional products that we develop in the future is insufficient, or if our product development is delayed, we may be unable to achieve profitability and, in the event we are unable to secure financing for prolonged periods of time, we may need to temporarily cease operations and, possibly, shut them down altogether.
−Removed: Furthermore, even if we can achieve profitability, we may be unable to sustain or increase such profitability on a quarterly or annual basis, which would adversely impact our financial condition and significantly reduce the value of our common stock.
−Removed: Events outside of our control, including those relating to public health crises, supply-chain disruptions, geopolitical conflicts, including acts of war, and inflation, could negatively affect our Company and our results of operations and financial condition.
−Removed: Periods of market volatility have occurred and could continue to occur in response to pandemics or other events outside of our control.
−Removed: These types of events may adversely affect operating results for us.
−Removed: For example, past pandemics and other health crises have led to disruptions in local, regional, national and global markets and economies affected thereby, including the United States.
−Removed: With respect to U.S.
−Removed: and global credit markets and the economy in general, these outbreaks have resulted in the following (among other things):
−Removed: (i) restrictions on travel and the temporary closure of many corporate offices, retail stores, and manufacturing facilities and factories, resulting in significant disruption to the business of many companies, including supply chains and demand, as well as layoffs of employees;
−Removed: (ii) increased draws by borrowers on lines of credit;
−Removed: (iii) increased requests by borrowers for amendments or waivers of their credit agreements to avoid default, increased defaults by borrowers and/or increased difficulty in obtaining refinancing;
−Removed: (iv) volatility in credit markets, including greater volatility in pricing and spreads;
−Removed: and (v) evolving proposals and actions by state and federal governments to address the problems being experienced by markets, businesses and the economy in general, which may not adequately address the problems being facing such persons.
−Removed: The outbreak of new, worsening strains of viruses, such as COVID-19, may result in a resurgence in the number of reported cases and hospitalizations.
−Removed: Such increases in cases could lead to the reintroduction of restrictions and business shutdowns in certain states, counties and cities in the United States and globally.
−Removed: In addition to these developments having adverse consequences for us and our portfolio companies, the operations of the Company have been, and could continue to be, adversely impacted, including through quarantine measures and travel restrictions imposed on its personnel or service providers based or temporarily located in affected countries, or any related health issues of such personnel or service providers.
−Removed: Supply chain and shipping disruptions have resulted in shipping delays, a significant increase in shipping costs, and could increase product costs and result in lost sales, which may have a material adverse effect on our business, operating results and financial condition.
−Removed: Supply chain disruptions, resulting from factors such as past pandemics and other health crises, labor supply and shipping container shortages, have impacted, and may continue to impact, us and our third-party manufacturers and suppliers.
−Removed: These disruptions have impacted our ability to receive products from manufacturers and suppliers, to distribute our products to our customers in a cost-effective and timely manner and to meet customer demand, all of which could have an adverse effect on our financial condition and results of operations.
−Removed: While we have taken steps to minimize the impact of these disruptions, there can be no assurances that further unforeseen events impacting the supply chain will not have a material adverse effect on us in the future.
−Removed: Additionally, the impact that supply chain disruptions have on our manufacturers and suppliers is not within our control.
−Removed: It is not currently possible to predict how long it will take for these supply chain disruptions to cease or ease.
−Removed: Prolonged supply chain disruptions impacting us, and our manufacturers and suppliers could interrupt product manufacturing, increase raw material and product lead times, increase raw material and product costs, impact our ability to meet customer demand and result in lost sales, all of which could have a material adverse effect on our business, financial condition and results of operations.
−Removed: Our dependence on key suppliers puts us at risk of interruptions in the availability of our products, which could reduce our revenue and adversely affect the results of operations.
−Removed: In addition, increases in prices for components used in our products could adversely affect our results of operations.
−Removed: We require the timely delivery of products provided by our suppliers, some of which are custom made, to ensure our ongoing sales revenue is not adversely affected.
−Removed: For reasons of quality assurance, cost effectiveness or availability, we procure certain products from a single or limited number of suppliers.
−Removed: We generally acquire such products through purchase orders placed in the ordinary course of business, and as a result we may not have a significant inventory of these products and generally do not have any guaranteed or contractual supply arrangements with many of these suppliers.
−Removed: Our reliance on these suppliers subjects us to risks that could harm our business, including, but not limited to, difficulty locating and qualifying alternative suppliers and limited control over pricing, availability, quality and delivery schedules.
−Removed: Suppliers of products may decide, or be required, for reasons beyond our control, to cease supplying materials and components to us or to raise their prices.
−Removed: Shortages of materials, quality control problems, production capacity constraints or delays by our suppliers could negatively affect our ability to meet our production requirements and result in increased prices for affected products.
−Removed: We may also face delays, yield issues and quality control problems if we are required to locate and secure new sources of supply.
−Removed: Any material shortage, constraint or delay may result in delays in shipments of our products, which could materially adversely affect the results of operations.
−Removed: Increases in prices for materials and components used in our products could also materially adversely affect our results of operations.
−Removed: Unfavorable global economic conditions have in the past and could in the future adversely affect our business, financial condition or results of operations.
−Removed: Our results of operations have in the past and could in the future be adversely affected by general conditions in the global economy and in the global financial markets.
−Removed: Key national economies, including the United States, have been affected from time to time by economic downturns or recessions, government shutdowns, supply chain constraints, heightened and fluctuating inflation and interest rates, restricted credit, poor liquidity, reduced corporate profitability, volatility in credit, equity and foreign exchange markets, bankruptcies and overall uncertainty with respect to the economy.
−Removed: For example, while we do not have activities in Russia and Ukraine or Gaza and Israel, the ongoing conflicts and any further escalation of geopolitical tensions related to these conflicts, including the imposition of sanctions by the United States and other countries, has and could result in, among other things, supply disruptions, fluctuations in foreign exchange rates, increased probability of a recession and increased volatility in financial markets.
−Removed: In addition, in the past, U.S.
−Removed: debt ceiling and budget deficit concerns have increased the possibility of additional credit-rating downgrades and economic slowdowns, or a recession in the United States.
−Removed: Although U.S.
−Removed: lawmakers passed legislation to raise the federal debt ceiling on multiple occasions, ratings agencies have lowered or threatened to lower the long-term sovereign credit rating on the United States.
−Removed: The impact of this or any further downgrades to the U.S.
−Removed: government’s sovereign credit rating or its perceived creditworthiness could adversely affect the U.S.
−Removed: and global financial markets and economic conditions.
−Removed: Any of these disruptions could adversely affect our businesses, results of operations and financial condition.
−Removed: A deterioration in the global economy and financial markets could result in a variety of risks to our business.
−Removed: In addition, we will be subject to currency exchange rate risk to the extent that our costs are denominated in currencies other than those in which we earn revenues.
−Removed: Fluctuations in currency exchange rates may therefore have an impact on our results as expressed in U.S.
−Removed: For example, inflation rates, particularly in the United States and UK, have seen increased levels compared to recent history.
−Removed: Elevated inflation may result in further currency fluctuations, increased operating costs (including our labor costs), reduced liquidity, and limitations on our ability to access credit or otherwise raise debt and equity capital.
−Removed: In addition, the United States Federal Reserve has raised, and may again raise, interest rates in response to concerns about inflation.
−Removed: Increases in interest rates, especially if coupled with reduced government spending and volatility in financial markets and geopolitics, may have the effect of further increasing economic uncertainty and heightening these risks.
−Removed: In addition, fluctuating interest rates or a general economic downturn or recession could reduce our ability to raise additional capital when needed on acceptable terms, if at all.
−Removed: A weak or declining economy, supply disruptions or international trade disputes could also strain our third-party suppliers, possibly resulting in supply disruption.
−Removed: Any of the foregoing could harm our business and we cannot anticipate all of the ways in which the current and future economic climate and financial market conditions could adversely impact our business.
−Removed: Moreover, the turmoil in the banking system, such as the turmoil seen in early 2023 with the appointment of the FDIC as a receiver for several U.S.
−Removed: banks, may increase market volatility.
−Removed: Due to these and other macroeconomic factors, many observers believe there is a risk of a recession occurring in the United States, and perhaps in other major global economies.
−Removed: These developments may adversely affect our business, financial condition and results of operations.
−Removed: In addition, we cannot predict whether quotas, duties, taxes, exchange controls, current or future “trade wars” or other restrictions will be imposed by the U.S., China, Canada and Mexico or other countries upon the import or export of our products and the commodities and components used to manufacture our products, or what effect any of these actions would have on our business, financial condition or results of operations.
−Removed: We cannot predict whether there might be changes in our ability to repatriate earnings or capital from international jurisdictions.
−Removed: Changes in regulatory and geopolitical policies and other factors may adversely affect our business or may require us to modify our current business practices.
−Removed: Continued inflation and increases in labor costs may reduce our profitability.
−Removed: We are currently experiencing inflationary pressures on our operating costs.
−Removed: Among other things, we have experienced increased costs for supplies, and rising fuel costs have resulted in increased costs for the transportation of drugs.
−Removed: We generally are not able to sufficiently raise our pricing to offset these increased costs.
−Removed: Continuing increased costs and prolonged inflation could materially and adversely affect our business, operating results and profitability.
−Removed: Government efforts to combat inflation, along with other interest rate pressures arising from an inflationary economic environment, could lead to us to incur even higher interest rates and financing costs and may reduce our profitability.
−Removed: Inflation has risen on a global basis, the United States has been experiencing historically high levels of inflation, and government entities have taken various actions to combat inflation, such as raising interest rate benchmarks.
−Removed: Government entities may continue their efforts, or implement additional efforts, to combat inflation, which could include among other things continuing to raise interest rate benchmarks and/or maintaining interest rate benchmarks at elevated levels.
−Removed: Such government efforts, along with other interest rate pressures arising from an inflationary economic environment, could lead to us to incur even higher interest rates and financing costs and have material adverse effect on our business, operating results and profitability.
−Removed: Currency exchange rate fluctuations may affect the results of operations.
−Removed: To the extent that we are successful in broadening the reach of our online e-commerce marketing into other countries we will have transactions denominated in an increasing number and variety of currencies.
−Removed: We will be subject to currency exchange rate risk to the extent that our costs are denominated in currencies other than those in which we earn revenues.
−Removed: Fluctuations in currency exchange rates may therefore have an impact on our results as expressed in U.S.
−Removed: There can be no assurance that currency exchange rate fluctuations will not adversely affect the results of operations, financial condition and cash flows.
−Removed: While the use of currency hedging instruments may provide us with protection from adverse fluctuations in currency exchange rates, by utilizing these instruments we potentially forego the benefits that might result from favorable fluctuations in currency exchange rates.
−Removed: We may need to raise additional capital to grow our business and satisfy our anticipated future liquidity needs, and we may not be able to raise it on terms acceptable to us, or at all.
−Removed: Growing and operating our business will require significant cash outlays, liquidity reserves and capital expenditures and commitments to respond to business challenges, including developing or enhancing new or existing products.
−Removed: As of December 31, 2024, we had cash on hand of approximately $20.0 million.
−Removed: If cash on hand, cash generated from operations, and the net proceeds from prior offerings are not sufficient to meet our cash and liquidity needs, we may need to seek additional capital, potentially through debt or equity financing.
−Removed: To the extent that we raise additional capital through the sale of additional equity or convertible securities, your ownership interest may be diluted, and the terms of these securities may include liquidation or other preferences that adversely affect your rights as a stockholder.
−Removed: Debt financing, if available, would result in increased fixed payment obligations and a portion of our operating cash flows, if any, being dedicated to the payment of principal and interest on such indebtedness.
−Removed: In addition, debt financing may involve agreements that include restrictive covenants that impose operating restrictions, such as restrictions on the incurrence of additional debt, the making of certain capital expenditures or the declaration of dividends.
−Removed: Any additional fundraising efforts may divert our management from their day-to-day activities, which may adversely affect our ability to develop and commercialize our products.
−Removed: Even if we believe we have sufficient funds for our current or future operating plans, we may seek additional capital if market conditions are favorable or considering specific strategic considerations.
−Removed: If we are unable to obtain funding on a timely basis, we may be required to significantly curtail, delay or discontinue one or more of our research or product candidate development programs or the commercialization of any product candidate or be unable to expand our operations or otherwise capitalize on our business opportunities, as desired, which could materially affect our business, operating results and prospects and cause the price of the common stock to decline.
−Removed: Sustained investment in our business, strategic acquisitions and investments, as well as our focus on long-term performance, and on maintaining the health of our new e-commerce ecosystem, may negatively affect our margins and our net income, if any.
−Removed: We will continue to increase our spending and investments in our business, including in organic development and growth of new businesses, strategic acquisitions and other initiatives.
−Removed: Investments in our business include:
−Removed: expanding and enhancing our core e-commerce offerings, including our marketplaces and new formats and features, our logistics network and capacities, our merchandising and supply chain capabilities, consumer services business, and international businesses;
−Removed: supporting our merchants, acquiring and retaining users and enhancing consumer experience and user engagement;
−Removed: strengthening and expanding various facilities and increasing our employee headcount;
−Removed: researching and developing new technologies, including digital assets, and improving our technological infrastructure;
−Removed: and cloud computing capacity;
−Removed: incubating new business initiatives.
−Removed: Although we believe these investments are crucial to our viability and future growth, they will have the effect of increasing our costs and lowering our margins and profit, and this effect may be significant in the short term and potentially over longer periods.
−Removed: We intend to make strategic investments, acquisitions and joint ventures to further strengthen our business.
−Removed: We may make strategic investments, acquisitions and joint ventures in a range of areas either directly related to one or more of our businesses, or related to the infrastructure, technology, services or products that support our businesses and marketing platforms.
−Removed: Our strategic investments, acquisitions and joint ventures may adversely affect our financial results, at least in the short term.
−Removed: As a result of business or financial underperformance, regulatory scrutiny or compliance reasons, we may need to divest interests in, or terminate business cooperation with, businesses and entities in which we have invested capital and other resources, which may adversely affect our financial results, ability to conduct investments in similar businesses, reputation and growth prospects, as well as the trading prices of our securities.
−Removed: There can be no assurance that we will be able to grow our acquired or invested businesses, or realize returns, benefits of synergies and growth opportunities we expect in connection with these investments and acquisitions.
−Removed: Failure to maintain or improve our technological infrastructure could harm our business and prospects.
−Removed: We continually add upgrades to our platforms to provide increased scale, improved performance, additional capacity and additional built-in functionality, including functionality related to security.
−Removed: Adopting new products and maintaining and upgrading our technology infrastructure require significant investments of time and resources.
−Removed: Any failure to maintain and improve our technology infrastructure could result in unanticipated system disruptions, slower response times, impaired user experience and delays in reporting accurate operating and financial information.
−Removed: If we experience problems with the functionality and effectiveness of our software, interfaces or platforms, or are unable to maintain and continuously improve our technology infrastructure to handle our business needs, our business, financial condition, results of operations and prospects, as well as our reputation and brand, could be materially and adversely affected.
−Removed: In addition, our technology infrastructure and services incorporate third-party developed software, systems and technologies, as well as hardware purchased or commissioned from third-party and overseas suppliers.
−Removed: As our technology infrastructure and services expand and become increasingly complex, we face increasingly serious risks to the performance and security of our technology infrastructure and services that may be caused by these third-party developed components, including risks relating to incompatibilities with these components, service failures or delays or difficulties in integrating back-end procedures on hardware and software.
−Removed: We also need to continuously enhance our existing technology.
−Removed: Otherwise, we face the risk of our technology infrastructure becoming unstable and susceptible to security breaches.
−Removed: This instability or susceptibility could create serious challenges to the security and uninterrupted operation of our platforms and services, which would materially and adversely affect our business and reputation.
−Removed: Product development is a long, expensive and uncertain process.
−Removed: The development of our own branded range of satellite tracking devices is a costly, complex and time-consuming process, and the investment in product development often involves a long wait until a return, if any, is achieved on such investment.
−Removed: Investments in new technology and processes are inherently speculative.
−Removed: We have experienced numerous setbacks and delays in our research and development efforts and may encounter further obstacles in the course of the development of additional technologies and products.
−Removed: We may not be able to overcome these obstacles or may have to expend significant additional funds and time.
−Removed: Technical obstacles and challenges we encounter in our research and development process may result in delays in or abandonment of product commercialization, may substantially increase the costs of development, and may negatively affect our results of operations.
−Removed: Concentration of ownership by our principal stockholders may result in control by such stockholders of the composition of our board of directors.
−Removed: As of March 17, 2025, our existing principal stockholders, named executive officers, directors and their affiliates beneficially own approximately 39.7% of our outstanding shares of common stock.
−Removed: In addition, such parties may acquire additional control by purchasing stock that we may issue in connection with our future fundraising efforts.
−Removed: As a result, these stockholders may now and in the future be able to exercise a significant level of control over all matters requiring stockholder approval, including the election of directors.
−Removed: This control could have the effect of delaying or preventing a change of control of our company or changes in management and will make the approval of certain transactions difficult or impossible without the support of these stockholders.
−Removed: Successful technical development of our products does not guarantee successful commercialization.
−Removed: We may successfully complete the technical development for one or all our product development programs, but still fail to develop a commercially successful product for several reasons, including among others the following:
−Removed: failure to obtain the required regulatory approvals for their use;
−Removed: prohibitive production costs;
−Removed: competing products;
−Removed: lack of innovation of the product;
−Removed: ineffective distribution and marketing;
−Removed: failure to gain market acceptance;
−Removed: lack of sufficient cooperation from our partners;
−Removed: demonstrations of the products not aligning with or meeting customer needs.
−Removed: Our success in the market for the products we develop will depend largely on our ability to prove our products’ capabilities.
−Removed: Upon demonstration, our satellite ground stations, and tracking devices may not have the capabilities they were designed to have or that we believed they would have.
−Removed: Furthermore, even if we do successfully demonstrate our products’ capabilities, potential customers may be more comfortable doing business with a larger, more established, more proven company than us.
−Removed: Moreover, competing products may prevent us from gaining wide market acceptance of our products.
−Removed: Significant revenue from new product investments may not be achieved for a number of years, if at all.
−Removed: Public company compliance may make it more difficult to attract and retain officers and directors.
−Removed: The Sarbanes-Oxley Act and rules subsequently implemented by the SEC have required changes in corporate governance practices of public companies.
−Removed: As a public company, we expect these rules and regulations to increase our compliance costs in 2025 and beyond and to make certain activities more time consuming and costly.
−Removed: As a public company, we also expect that these rules and regulations may make it more difficult and expensive for us to obtain director and officer liability insurance in the future and we may be required to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage.
−Removed: As a result, it may be more difficult for us to attract and retain qualified people to serve on our Board of Directors or as executive officers.
−Removed: Conflicts of interest may arise between us and our directors and officers as a result of other business activities undertaken by such individuals.
−Removed: We may be subject to various potential conflicts of interest because some of our directors and executive officers may be engaged in a range of business activities.
−Removed: In addition, our executive officers and directors may devote time to their outside business interests, so long as such activities do not materially or adversely interfere with their duties to us.
−Removed: In some cases, our executive officers and directors may have fiduciary obligations associated with these business interests that interfere with their ability to devote time to our business and affairs and that could adversely affect our operations.
−Removed: These business interests could require significant time and attention of our executive officers and directors.
−Removed: In addition, we may also become involved in other transactions which conflict with the interests of our directors and the officers who may from time-to-time deal with persons, firms or institutions with which we may be dealing, or which may be seeking investments similar to those we desire.
−Removed: The interests of these persons could conflict with our interests.
−Removed: In addition, from time to time, these persons may be competing with us for available investment opportunities.
−Removed: Conflicts of interest, if any, will be subject to the procedures and remedies provided under applicable laws, regulations and stock market rules.
−Removed: In particular, in the event that such a conflict of interest arises at a meeting of our board of directors, a director who has such a conflict will abstain from voting for or against the approval of such transaction.
−Removed: In accordance with applicable laws, our directors are required to act honestly, in good faith and in our best interests.
−Removed: Other companies may claim that we infringe their intellectual property, which could materially increase our costs and harm our ability to generate future revenue and profit.
−Removed: We do not believe that we infringe the proprietary rights of any third party but claims of infringement are becoming increasingly common and third parties may assert infringement claims against us.
−Removed: It may be difficult or impossible to identify, prior to receipt of notice from a third party, the trade secrets, patent position or other intellectual property rights of a third party, either in the United States or in foreign jurisdictions.
−Removed: Any such assertion may result in litigation or may require us to obtain a license for the intellectual property rights of third parties.
−Removed: If we are required to obtain licenses to use any third-party technology, we would have to pay royalties, which may significantly reduce any profit on our products or may be prohibitively expensive and prevent us from continuing to use that technology.
−Removed: In addition, any such litigation, even if without merit, could be expensive and disruptive to our ability to generate revenue or enter new market opportunities.
−Removed: If any of our products were found to infringe other parties’ proprietary rights and we are unable to come to terms regarding a license with such parties, we may be forced to modify our products to make them non-infringing, to pay substantial damages to our end users to discontinue their use of or replace infringing technology sold to them with non-infringing technology, or to cease production of such products altogether.
−Removed: We may not be able to protect our intellectual property rights .
−Removed: We rely on a combination of trademark, fair trade practice, patent, copyright and trade secret protection laws, as well as confidentiality procedures and contractual provisions, to protect our intellectual property rights.
−Removed: We may not be able to effectively protect our intellectual property rights or to enforce our contractual rights.
−Removed: In addition, policing any unauthorized use of our intellectual property is difficult, time-consuming and costly and the steps we have taken may be inadequate to prevent the misappropriation of our intellectual property.
−Removed: If we resort to litigation to enforce our intellectual property rights, this litigation could result in substantial costs and a diversion of our managerial and financial resources.
−Removed: There can be no assurance that we will prevail in any litigation.
−Removed: In addition, our trade secrets may be leaked or otherwise become available to, or be independently discovered by, our competitors.
−Removed: Any failure in protecting or enforcing our intellectual property rights could have a material adverse effect on our business, financial condition and results of operations.
−Removed: Confidentiality agreements with employees and third parties may not prevent unauthorized disclosure of trade secrets and other proprietary information, and our inability to maintain the confidentiality of that information, due to unauthorized disclosure or use, or other event, could have a material adverse effect on our business.
−Removed: In addition to the protection afforded by patents, we seek to rely on trade secret protection and confidentiality agreements to protect proprietary know-how that is not patentable or that we elect not to patent, processes for which patents are difficult to enforce, and any other elements of our product discovery and development processes that involve proprietary know-how, information, or technology that is not covered by patents.
−Removed: Trade secrets, however, may be difficult to protect.
−Removed: We seek to protect our proprietary processes, in part, by entering into confidentiality agreements with our employees, consultants, advisors, contractors and collaborators.
−Removed: Although we use reasonable efforts to protect our trade secrets, our employees, consultants, advisors, contractors, and collaborators might intentionally or inadvertently disclose our trade secret information to competitors.
−Removed: In addition, competitors may otherwise gain access to our trade secrets or independently develop substantially equivalent information and techniques.
−Removed: Furthermore, the laws of some foreign countries do not protect proprietary rights to the same extent or in the same manner as the laws of the United States.
−Removed: As a result, we may encounter significant problems in protecting and defending our intellectual property both in the United States and abroad.
−Removed: If we are unable to prevent unauthorized material disclosure of our intellectual property to third parties, or misappropriation of our intellectual property by third parties, we will not be able to establish or maintain a competitive advantage in our market, which could materially adversely affect our business, operating results and financial condition.
−Removed: Being a public company is expensive and administratively burdensome.
−Removed: As a public reporting company, we are subject to the information and reporting requirements of the Securities Act of 1933, as amended (the “Securities Act”), the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and other federal securities laws, rules and regulations related thereto, including compliance with the Sarbanes-Oxley Act.
−Removed: Complying with these laws and regulations requires the time and attention of our Board of Directors and management and increases our expenses.
−Removed: We estimate the Company will incur approximately $400,000 to $600,000 annually in connection with being a public company.
−Removed: Among other things, we are required to:
−Removed: maintain and evaluate a system of internal controls over financial reporting in compliance with the requirements of Section 404 of the Sarbanes-Oxley Act and the related rules and regulations of the SEC and the Public Company Accounting Oversight Board;
−Removed: prepare and distribute periodic reports in compliance with our obligations under federal securities laws;
−Removed: institute a more comprehensive compliance function, including with respect to corporate governance;
−Removed: involve, to a greater degree, our outside legal counsel and accountants in the above activities.
−Removed: The costs of preparing and filing annual and quarterly reports, proxy statements and other information with the SEC and furnishing audited reports to stockholders are expensive and much greater than that of a privately-held company, and compliance with these rules and regulations may require us to hire additional financial reporting, internal controls and other finance personnel, and will involve a material increase in regulatory, legal and accounting expenses and the attention of management.
−Removed: There can be no assurance that we will be able to comply with the applicable regulations in a timely manner, if at all.
−Removed: In addition, being a public company makes it more expensive for us to obtain director and officer liability insurance.
−Removed: In the future, we may be required to accept reduced coverage or incur substantially higher costs to obtain this coverage.
−Removed: We may fail to maintain effective internal control over financial reporting and effective disclosure controls and procedures, and as a result, we may not be able to accurately report our financial results in a timely manner or prevent fraud, which may adversely affect investor confidence in our company.
−Removed: We are required to comply with the SEC’s rules implementing Sections 302 and 404(a) of the Sarbanes-Oxley Act of 2002, which require management to certify financial and other information in our quarterly and annual reports and provide an annual management report on the effectiveness of internal controls over financial reporting.
−Removed: As a smaller reporting company, our independent registered public accounting firm will not be required to attest to the effectiveness of our internal controls over financial reporting pursuant to Section 404(b) until we are no longer a smaller reporting company.
−Removed: At such time, our independent registered public accounting firm may issue a report that is adverse in the event material weaknesses have been identified in our internal control over financial reporting.
−Removed: To comply with the requirements of being a public company, we have undertaken and will need to undertake additional actions, such as implementing new internal controls and procedures and hiring additional accounting or internal audit staff.
−Removed: Any control system, no matter how well designed and operated, is based upon certain assumptions and can provide only reasonable, not absolute, assurance that its objectives will be met.
−Removed: Further, no evaluation of controls can provide absolute assurance that misstatements due to errors or fraud will not occur or that all control issues and instances of fraud, if any, within the Company have been detected.
−Removed: Testing and maintaining internal control can divert our management’s attention from other matters that are important to the operation of our business.
−Removed: In addition, when evaluating our internal control over financial reporting, we may identify material weaknesses that we may not be able to remediate in time to meet the applicable deadlines imposed upon us for compliance with the requirements of Section 404.
−Removed: If we identify any material weaknesses in our internal controls over financial reporting or we are unable to comply with the requirements of Section 404 in a timely manner or assert that our internal control over financial reporting is effective, or if our independent registered public accounting firm is unable to express an opinion as to the effectiveness of our internal control over financial reporting once we are no longer a smaller reporting company, investors may lose confidence in the accuracy and completeness of our financial reports.
−Removed: As a result, the market price of our common stock could be materially adversely affected.
−Removed: We will become subject to a broad range of laws and regulations, and future laws and regulations may impose additional requirements and other obligations that could materially and adversely affect our business, financial condition and results of operations, as well as the trading prices of our securities.
−Removed: The industries in which we plan to operate, including online and mobile commerce, digital media, and entertainment and other online content offerings, as well as certain important business processes, including those that may be deemed as relating to payment and settlement of funds, are highly regulated.
−Removed: Government authorities across the globe are likely to continue to issue new laws, rules and regulations and enhance enforcement of existing laws, rules and regulations in these industries.
−Removed: They have imposed, and may continue to impose, requirements or restrictions relating to, among other things, the provision of certain regulated products or services through platforms, new and additional licenses, permits and approvals, renewals and amendments of licenses, or governance or ownership structures, on us or certain of our businesses and our users.
−Removed: Failure to obtain and maintain such required licenses or approvals may materially and adversely affect our business.
−Removed: If we are successful in implementing our business strategy we will generate and process a large amount of data, including personal data, and the improper use or disclosure of data could result in regulatory investigations and penalties, and harm our reputation and have a material adverse effect on the trading prices of our securities, our business and our prospects.
−Removed: If we are successful in implementing our business strategy, we will generate and process a large amount of data.
−Removed: Our privacy policies concerning the collection, use and disclosure of personal data are posted on our platforms.
−Removed: We face risks inherent in handling and protecting large volumes of data, especially consumer data.
−Removed: We face several challenges relating to data from transactions and other activities on our platforms, including:
−Removed: protecting the data in and hosted on our system, including against attacks on our system or unauthorized use by outside parties or fraudulent behavior or improper use by our employees;
−Removed: addressing concerns, challenges, negative publicity and litigation related to data privacy, collection, use and actual or perceived sharing for promotional and other purposes (including sharing among our own businesses, with business partners or regulators, and concerns among the public about the alleged discriminatory treatment adopted by Internet platforms based on user profile), safety, security and other factors that may arise from our existing businesses or new businesses and technologies, such as new forms of data (for example, biometric data, location information and other demographic information);
−Removed: complying with applicable laws, rules and regulations relating to the collection (from users and other third-party systems or sources), use, storage, transfer, disclosure and security of personal data, including requests from data subjects and regulatory and government authorities.
−Removed: Our business is subject to complex and evolving domestic and international laws and regulations regarding privacy and data protection.
−Removed: These laws and regulations can be complex and stringent, and many are subject to change and uncertain interpretation, which could result in claims, changes to our data and other business practices, regulatory investigations, penalties, increased cost of operations, or declines in user growth or engagement, or otherwise affect our business.
−Removed: Regulatory authorities around the world have implemented and are considering further legislative and regulatory proposals concerning data protection.
−Removed: New laws and regulations that govern new areas of data protection or impose more stringent requirements may be introduced in jurisdictions where we may conduct business or may expand into.
−Removed: It is possible that existing or newly- introduced laws and regulations, or their interpretation, application or enforcement, could significantly affect the value of our data, force us to change our data and other business practices and cause us to incur significant compliance costs.
−Removed: As we further expand our operations into international markets, we will be subject to additional laws in other jurisdictions where we operate and where our consumers, users, merchants, customers and other participants are located.
−Removed: The laws, rules and regulations of other jurisdictions may be more comprehensive, detailed and nuanced in their scope, and may impose requirements and penalties that conflict with, or are more stringent than, those to which we are currently subject.
−Removed: In addition, these laws, rules and regulations may restrict the transfer of data across jurisdictions, which could impose additional and substantial operational, administrative and compliance burdens on us, and may also restrict our business activities and expansion plans, as well as impede our data-driven business strategies.
−Removed: Complying with laws and regulations for an increasing number of jurisdictions could require significant resources and costs.
−Removed: The nature of our business involves significant risks and uncertainties that may not be covered by insurance or indemnity.
−Removed: We develop and sell products where insurance or indemnification may not be available, including:
−Removed: Designing and developing products using advanced and unproven technologies in intelligence and homeland security applications that are intended to operate in high demand, high risk situations;
−Removed: Designing and developing products to collect, distribute and analyze various types of information.
−Removed: Failure of certain of our products could result in loss of life or property damage.
−Removed: Certain products may raise questions with respect to issues of privacy rights, civil liberties, intellectual property, trespass, conversion and similar concepts, which may raise new legal issues.
−Removed: Indemnification to cover potential claims or liabilities resulting from a failure of technologies developed or deployed may be available in certain circumstances but not in others.
−Removed: We are not able to maintain insurance to protect against all operational risks and uncertainties.
−Removed: Substantial claims resulting from an accident, failure of our product, or liability arising from our products in excess of any indemnity or insurance coverage (or for which indemnity or insurance is not available or was not obtained) could harm our financial condition, cash flows, and operating results.
−Removed: Any accident, even if fully covered or insured, could negatively affect our reputation among our customers and the public, and make it more difficult for us to compete effectively.
−Removed: Our operations in international markets, and earnings in those markets, may be affected by changes in global cultural, political, and financial market conditions as well as potential changes in regulations, legislation and government policies such as tariffs, tax laws and global trade policies.
−Removed: Approximately 67% of our sales for the year ended December 31, 2024 were earned in international markets.
−Removed: As such our ability to maintain the current level of operations in our existing international markets and to capitalize on growth in existing and new international markets is subject to risks associated with international operations.
−Removed: Our products are subject to increasingly stringent and complex domestic and foreign product labeling and performance and safety standards, laws and other regulations.
−Removed: These requirements could result in greater expense associated with compliance efforts, and failure to comply with these regulations could result in a delay, non-delivery, recall, or destruction of inventory shipments during key seasons or in other financial penalties.
−Removed: Significant or continuing noncompliance with these standards and laws could disrupt our business and harm our reputation.
−Removed: These include the burdens of complying with a variety of foreign laws and regulations, unexpected changes in regulatory requirements, new tariffs or other barriers to some international markets.
−Removed: For example, any future withdrawal or renegotiation of trade agreements, and the prosecution of trade disputes or the imposition of tariffs, duties, taxes and other charges on imports or exports between the United States and countries like China, Canada and Mexico may adversely affect our ability to operate our business and execute our growth strategy.
−Removed: In addition, it may be more difficult for us to enforce agreements, collect receivables, receive dividends and repatriate earnings through foreign legal systems.
−Removed: We cannot predict whether quotas, duties, taxes, exchange controls, current or future trade wars or other restrictions will be imposed by the United States, China, Canada and Mexico or other countries upon the import or export of our products and the commodities and components used to manufacture our products, or what effect any of these actions would have on our business, financial condition or results of operations.
−Removed: We cannot predict whether there might be changes in our ability to repatriate earnings or capital from international jurisdictions.
−Removed: Changes in regulatory and geopolitical policies and other factors may adversely affect our business or may require us to modify our current business practices.
−Removed: In addition, global economic uncertainty relating to the effects of fiscal and political crises and political and economic disputes, changes in consumer spending, foreign currency exchange rate fluctuations, political unrest, natural disasters or other crises, terrorist acts, acts of war and/or military operations, could have a material adverse effect on our financial condition, results of operations and cash flows.
+Added: We have incurred significant net losses, have accumulated deficit, and may require additional capital to continue operations and execute our business strategy.
+Added: We have incurred significant net losses since inception.
+Added: For the years ended December 31, 2025, and 2024, we have incurred net losses of approximately $10.5 million, and $22.5 million, respectively, and as of December 31, 2025, we had an accumulated deficit of approximately $60.1 million.
+Added: We expect to continue to incur operating losses as we invest in expanding our e-Commerce and healthcare operations, develop new platforms and services, and pursue potential acquisitions.
+Added: Our ability to achieve profitability depends on numerous factors, many of which are outside of our control, including growth in revenue, management of operating expenses, the stability of supply chains, reimbursement levels within our healthcare segment, competitive pressures, and overall economic conditions.
+Added: If revenue growth does not occur at the pace we anticipate, or if our operating expenses increase more rapidly than expected, we may be unable to achieve or sustain profitability.
+Added: We may require additional capital to support our operations, fund working capital needs, make strategic acquisitions, expand our healthcare footprint, enhance our technology platforms, and service any indebtedness.
+Added: We cannot assure you that additional financing will be available on favorable terms, or at all.
+Added: If we raise funds through the issuance of equity securities, existing stockholders may experience significant dilution.
+Added: If we incur additional indebtedness, such debt may contain restrictive covenants that limit our operational flexibility and could increase our exposure to interest rate risk.
+Added: If we are unable to obtain sufficient capital when needed, we may be required to delay, reduce, or eliminate certain business initiatives, scale back operations, sell assets, or seek protection under applicable bankruptcy laws.
+Added: Any of these outcomes could materially and adversely affect our business, financial condition, results of operations, and the value of our common stock.
+Added: Even if we achieve profitability in future periods, we may not be able to sustain or increase profitability on a quarterly or annual basis, and our results from operations and cash flows may fluctuate significantly from period to period.
+Added: Unfavorable global economic conditions, inflation, rising interest rates and financial market volatility could materially adversely affect our business.
+Added: Our operations are sensitive to general economic conditions in the United States and globally.
+Added: Economic downturns, recessions, government shutdowns, credit tightening, inflationary pressures, rising interest rates, supply chain constraints, and volatility in equity and foreign exchange markets could reduce consumer spending on discretionary products, increase our operating costs, impair access to capital, and negatively affect our results of operations and cash flows.
+Added: Inflation has increased our operating costs, including product sourcing, freight, fuel, labor and pharmaceutical acquisition costs.
+Added: We may not be able to pass these increased costs through to customers or reimbursement sources in a timely manner, which may result in margin compression.
+Added: Increases in benchmark interest rates may increase our cost of capital and reduce our ability to raise additional funds.
+Added: Geopolitical conflicts, including the Russia-Ukraine conflict and Middle East hostilities, may contribute to supply chain disruptions, fuel price volatility, currency fluctuations and broader economic uncertainty.
+Added: The cumulative impact of these macroeconomic conditions could materially adversely affect our business, financial condition, results of operations, and cash flows.
+Added: Our business may be adversely affected by pandemics, public health crises, natural disasters, acts of war or other events beyond our control.
+Added: Public health crises, including pandemics, as well as natural disasters, severe weather events, terrorist acts, civil unrest and acts of war, could disrupt global supply chains, impair logistics providers, limit workforce availability, reduce consumer demand, restrict travel, and interrupt our operations or those of our suppliers and customers.
+Added: Such events may also increase credit risk, cause financial market volatility, and impair access to capital.
+Added: The occurrence of any of these events could materially adversely affect our business and financial condition.
+Added: We rely heavily on a single pharmaceutical wholesale distributor for substantially all of our pharmaceutical purchases.
+Added: Approximately 98% of our pharmaceutical purchases for the year ended December 31, 2025 were obtained from a single wholesale distributor.
+Added: The loss of, or material change in, this relationship could result in drug shortages, higher acquisition costs, unfavorable credit terms, or operational disruptions.
+Added: Transitioning to alternative suppliers could require regulatory approvals, system integrations, renegotiation of contracts and DEA compliance measures and may not be completed on commercially reasonable terms or within acceptable timeframes.
+Added: Any disruption in pharmaceutical supply could materially adversely affect our healthcare operations, profitability and cash flows.
+Added: We may fail to maintain compliance with applicable continued listing standards of The Nasdaq Stock Market.
+Added: Our common stock is listed on The Nasdaq Stock Market and we must satisfy continued listing requirements, including minimum stock price, public float, stockholders’ equity and other corporate governance standards.
+Added: If we fail to satisfy these requirements, Nasdaq may issue a deficiency notice and ultimately delist our securities.
+Added: Any delisting could materially adversely affect the liquidity and market price of our common stock, reduce our ability to raise capital, limit institutional investor participation, and adversely affect our reputation.
+Added: Even if we are able to regain compliance, the process may be costly and disruptive to management.
+Added: We have been notified by The Nasdaq Stock Market LLC of our failure to comply with certain Nasdaq continued listing requirements and if we are unable to regain compliance with all applicable Nasdaq continued listing requirements and standards, our Common Stock could be delisted from Nasdaq.
+Added: Our Common Stock is listed on the Nasdaq Capital Market and to maintain our listing, we are required to satisfy continued listing requirements.
+Added: There can be no assurance we will continue satisfying such continued listing requirements, which include among other requirements, that the closing bid price of our Common Stock be at least $1.00 per share (the “Minimum Bid Price Requirement”) and that that the market value of our publicly held shares of Common Stock be at least $1 million (the “Market Value Requirement”).
+Added: On April 28, 2025, we received a letter from the Listing Qualifications Department (the “Staff”) of The Nasdaq Stock Market LLC (“Nasdaq”) notifying us that, for the previous 30 consecutive business days, the closing bid price for the Common Stock had been below the minimum $1.00 per share required for continued listing on the Nasdaq Capital Market under the Minimum Bid Price Requirement.
+Added: The Staff provided the Company with an initial period of 180 calendar days, or until October 27, 2025, to regain compliance with the Minimum Bid Price Requirement.
+Added: On October 28, 2025, we received a letter from the Staff notifying us that the Company is eligible for a second 180-day period, or until April 27, 2026 (the “Second Grace Period”) to regain compliance with the Minimum Bid Price Requirement.
+Added: According to the notification, the Staff’s determination was based on (i) the Company meeting the continued listing requirement for market value of its publicly held shares and all other Nasdaq initial listing standards, with the exception of the Minimum Bid Price Requirement, and (ii) the Company’s written notice to Nasdaq of its intention to cure the deficiency during the Second Grace Period by effecting a reverse stock split, if necessary.
+Added: To regain compliance with the Minimum Bid Price Requirement, the Company scheduled a special meeting of shareholders (the “Special Meeting”) that occurred on March 27, 2026.
+Added: At the Special Meeting, the shareholders considered a proposal (the “Reverse Stock Split Proposal”) for the Company to implement one or more reverse stock splits in a range between 1-for-5 to 1-for-50 shares at the discretion of the Board of Directors (the “Reverse Stock Split”).
+Added: The Reverse Stock Split Proposal, if passed, is intended to increase our stock price to an amount that we expect will allow our common stock to stay trading above the $1.00 minimum threshold in the long term.
+Added: If the Reverse Stock Split is successful and if we can maintain a trading price above $1.00 for at least ten (10) consecutive trading days, then we expect to be able to regain compliance with the Minimum Bid Price requirement.
+Added: Maintaining our Nasdaq listing as a publicly traded listed company has numerous benefits to the Company, including our ability to procure more financing for ongoing operations, our ability to further our business strategy and our ability to attract more investor and business partner interest, among others.
+Added: On March 27, 2026, the shareholders voted to approve the Reverse Stock Split Proposal.
+Added: Also, on March 27, 2026, the Board of Directors voted to approve a reverse stock split at a ratio of 1-to-10.
+Added: There can be no assurance that the Company will be able to comply with all of the obligations placed on us by Nasdaq in order to regain compliance with such Nasdaq Capital Market continued listing standards, and, assuming that we are able to comply with such obligations, that we will be able to continue to comply with such Nasdaq Capital Market continued listing standards in the future, including the Minimum Bid Price Requirement and the Market Value Requirement.
+Added: If we fail to regain compliance by the end of the Second Grace Period, we may not be successful in any appeal to Nasdaq to grant additional extensions, or in the event that we are successful, we may not be able to regain compliance by such additional extension date.
+Added: In the event that we are not successful in such appeal or we are not able to regain compliance with such requirements by any applicable date, our Common Stock will be subject to delisting from Nasdaq.
+Added: Additionally, assuming we are able to comply with all such obligations, but we fail to comply with all applicable Nasdaq listing requirements in the future, our Common Stock may be subject to delisting from Nasdaq.
+Added: In the event of such a delisting and that the Common Stock is not eligible for trading on another national securities exchange, trading of our Common Stock could be conducted in the over-the-counter market operated by the OTC Markets Group, Inc.
+Added: In such event, it could become more difficult to dispose of, or obtain accurate price quotations for, our Common Stock, and it would likely be more difficult to obtain coverage by securities analysts and the news media, which could cause the price of our Common Stock to decline further.
+Added: Also, it may be difficult for us to raise additional capital if we are not listed on a national exchange.
+Added: Additionally, in the event of such delisting, we may be subject to penalties or defaults under certain of our material agreements, which could materially and adversely affect our business, operating results, cash flows, and financial condition.
+Added: The Reverse Stock Split may incentivize stockholders to sell their holdings of our common stock following the effectiveness of the Reverse Stock Split and depress the stock price, which could lead to our delisting from Nasdaq.
+Added: Similar with what has happened to our stock price in the past, if a significant number of shares of our common stock are sold into the market over a period of time, the increase in supply could lead to a depression of the stock price and it may be difficult to recover from such depression.
+Added: Since our common stock has been trading at significantly lower prices than what we expect the stock price will be immediately following the effectiveness of the Reverse Stock Split, some stockholders may take the opportunity to sell some or all of their shares of common stock following the effectiveness of the Reverse Stock Split.
+Added: If this happens, our stock price could decrease quickly from the opening trading market price on the day of effectiveness of the Reverse Stock Split.
+Added: If we are not successful in mitigating the volatility to our stock price following that date and over time, then we may not recognize any of the intended benefits of completing the Reverse Stock Split.
+Added: If the stock price dips below $1.00 again following the completion of the Reverse Stock Split at any point in the ten trading days following the effectiveness of the Reverse Stock Split, then we will be subject to delisting from Nasdaq.
+Added: Even if we are able to maintain a stock price above $1.00 for ten (10) trading days following the effectiveness of the Reverse Stock Split (or some longer period as Nasdaq may designate at their discretion) or if the Company falls out of compliance with the Minimum Bid Price requirement ( i.e.
+Added: , our stock price falls below $1.00 for a period of thirty (30) consecutive trading days) in the year following the effectiveness of the Reverse Stock Split, then we will be subject to immediate delisting from Nasdaq.
+Added: If the results of the Reverse Stock Split are different than expected and we are delisted from Nasdaq, the delisting will have a significant adverse impact on our business, operations, cash flows, and financial condition.
+Added: While we expect the Reverse Stock Split to increase our stock price and allow us to regain compliance with the Minimum Bid Price Requirement and remain listed on Nasdaq, the effect of the Reverse Stock Split on the market price of our common stock cannot be predicted with certainty, and the results of reverse stock splits by companies under similar circumstances have varied.
+Added: It is not uncommon for the market capitalization of a company’s common stock to decline in the period following a reverse stock split.
+Added: Factors unrelated to the number of shares of our common stock outstanding, such as negative financial results or negative developments regarding our product development program or the commercializing and scaling efforts of our products, could adversely affect the market price of our common stock and jeopardize our ability to regain compliance with the Minimum Bid Price requirement.
+Added: If we cannot maintain our stock price above $1.00 for at least ten consecutive trading days prior to April 27, 2026, then we will be subject to delisting from Nasdaq.
+Added: Even if the Reverse Stock Split is successful in increasing our stock price above $1.00, we may have challenges in maintaining compliance with other Nasdaq continued listing rules.
+Added: For example, the Reverse Stock Split may result in a lesser number of round lot holders (holders of at least 100 shares), which could cause us to be noncompliant with a Nasdaq rule requiring that we have at least 300 round lot holders to maintain continued listing compliance.
+Added: Once a company has been delisted, its stock can trade on OTC, but such companies will have significantly fewer opportunities to attract financing partners and less leverage to negotiate terms for such financing instruments and arrangements that are not overly burdensome or expensive to the company.
+Added: If our stock trades on OTC, we will not be able to maintain S-3 shelf eligibility.
+Added: Our S-3 shelf eligibility greatly increases our access to the capital markets and other financing opportunities.
+Added: If we lose access to this source of capital raising and financing avenues, then we may not be able to source enough capital to finance our business plans and operations, which will materially adversely impact our business, operations, cash flows, and financial condition.
+Added: The Reverse Stock Split may not increase the price of our common stock over the long term .
+Added: As noted above, the purpose of the Reverse Stock Split is to help regain compliance with the Minimum Bid Price Requirement for continued listing on Nasdaq, as well as to increase the trading price of our common stock to enhance overall liquidity of the common stock by facilitating future financing and attracting new investors.
+Added: However, the effect of the Reverse Stock Split on the market price of our common stock cannot be predicted with any certainty, and we cannot assure you that the Reverse Stock Split will accomplish these objectives for any meaningful period of time, or at all.
+Added: While we expect that the reduction in the number of outstanding shares of common stock will proportionally increase the market price of our common stock, we cannot assure you that the Reverse Stock Split will increase the market price of our common stock by a multiple of the Reverse Stock Split ratio, or result in any permanent or sustained increase in the market price of our common stock.
+Added: The market price of our common stock may be affected by other factors which may be unrelated to the number of shares outstanding, including our business and financial performance, general market conditions, and prospects for future success.
+Added: Once we have effected a Reverse Stock Split, we must ensure that our stock price trades above $1.00 in the long term.
+Added: Under a Nasdaq rule that was amended in January 2025, if the Company falls out of compliance with the Minimum Bid Price Requirement (i.e., our stock price falls below $1.00 for a period of thirty (30) consecutive trading days) within one year of the completion of a Reverse Stock Split, then we will be immediately subject to delisting from Nasdaq and we will not be afforded another 180-day compliance period.
+Added: The Reverse Stock Split may decrease the liquidity of our common stock .
+Added: The Board of Directors (“Board”) believes that the Reverse Stock Split may result in an increase in the market price of our common stock, which could lead to increased interest in our common stock and possibly promote greater liquidity for our stockholders.
+Added: However, the Reverse Stock Split may also reduce the total number of outstanding shares of common stock, which may lead to reduced trading and a smaller number of market makers for our common stock, particularly if the price per share of our common stock does not increase as a result of the Reverse Stock Split.
+Added: The Reverse Stock Split may result in some stockholders owning “ odd lots ” that may be more difficult to sell or require greater transaction costs per share to sell.
+Added: If the Reverse Stock Split is implemented, it may increase the number of stockholders who own “odd lots” of less than 100 shares of common stock.
+Added: A purchase or sale of less than 100 shares of common stock (an “odd lot” transaction) may result in incrementally higher trading costs through certain brokers, particularly “full service” brokers.
+Added: Therefore, those stockholders who own fewer than 100 shares of common stock following the Reverse Stock Split may be required to pay higher transaction costs if they sell their common stock.
+Added: The Reverse Stock Split may lead to a decrease in our overall market capitalization .
+Added: The Reverse Stock Split may be viewed negatively by the market and, consequently, could lead to a decrease in our overall market capitalization.
+Added: If the per share market price of our common stock does not increase in proportion to the Reverse Stock Split ratio, then the value of our Company, as measured by our market capitalization, may be reduced.
+Added: Additionally, any reduction in our market capitalization may be magnified as a result of the smaller number of total shares of common stock outstanding following the Reverse Stock Split.
+Added: Our business requires significant working capital, and we are exposed to inventory and receivables risk.
+Added: Our e-Commerce and healthcare operations require significant working capital to purchase inventory, including satellite communication devices and pharmaceuticals.
+Added: We may be required to make substantial upfront inventory purchases before corresponding revenues are realized.
+Added: If we overestimate demand, experience obsolescence due to technological advances, encounter product recalls, or are unable to sell inventory at anticipated margins, we may be required to record inventory write-downs.
+Added: In addition, delays in reimbursement from payors or payment disputes could increase accounts receivable balances and negatively impact cash flow.
+Added: Any significant working capital shortfall, inventory impairment or receivable collection issue could materially adversely affect our financial condition, results of operations, and cash flows.
+Added: We may not have adequate insurance coverage to protect against all operational and product liability risks.
+Added: Our business includes the sale of communications equipment and the dispensing of pharmaceuticals.
+Added: Product defects, equipment malfunctions, adverse health outcomes or misuse of products could result in claims for personal injury, property damage or other losses.
+Added: Although we maintain insurance coverage, our policies may not be sufficient to cover all potential liabilities, and certain types of claims may be excluded.
+Added: Any uninsured or underinsured claim, or a claim exceeding policy limits, could materially adversely affect our financial condition, results of operations, and cash flows.
Risks Related to Our e-Commerce Business
−Removed: Our sales may be impacted should there be a disruption of service to our Amazon or Alibaba online storefronts.
−Removed: The Company’s Amazon online marketplaces represented approximately 32.8% and 51.6% of total sales for the years ended December 31, 2024, and 2023, respectively.
−Removed: In July 2021 we commenced sales through the Alibaba storefront.
−Removed: These marketplaces will represent a significant portion of our sales in the foreseeable future.
−Removed: Should there be a disruption of Amazon or Alibaba services or our ability to maintain storefronts with Amazon or Alibaba, our sales will likely decrease, and we would have to seek other distribution methods to sell our products online, which may be costly.
−Removed: In addition, if and to the extent the cost structure of the Amazon marketplace listing changes, such an increase could have a material adverse effect on the Company’s sales through this platform.
−Removed: Furthermore, our products sold on Amazon are subject to Amazon’s terms of service and various other Amazon seller policies that apply to third parties selling products on Amazon’s marketplace.
−Removed: Amazon’s terms of service provide, among other things, that it may terminate or suspend its agreement with any seller or any of its services being provided to a seller at any time and for any reason.
−Removed: In addition, if Amazon determines that any seller’s actions or performance, including ours, may result in violations of its terms or policies, or create other risks to Amazon or to third parties, then Amazon may in its sole discretion withhold any payments owed for as long as Amazon determines any related risk to Amazon or to third parties persist.
−Removed: Further, if Amazon determines that any seller’s, including our, accounts have been used to engage in deceptive, fraudulent or illegal activity, or that such accounts have repeatedly violated its policies, then Amazon may in its sole discretion permanently withhold any payments owed.
−Removed: Moreover, Amazon in its sole discretion may suspend a seller account and product listings if Amazon determines that a seller has engaged in conduct that violates any of its policies.
−Removed: Any limitation or restriction on our ability to sell on Amazon’s platform could have a material impact on our business, results of operations, financial condition and prospects.
−Removed: We also rely on services provided by Amazon’s fulfillment platform which provides expedited shipping to the consumer, an important aspect in the buying decision for consumers.
−Removed: Any inability to market our products for sale with delivery could have a material impact on our business, results of operations, financial condition and prospects.
−Removed: Failure to remain compliant with the fulfillment practices on Amazon’s platform could have a material impact on our business, results of operations, financial condition and prospects.
−Removed: Creating and maintaining a trusted status of our online marketing presence or ecosystem will be critical to our viability and growth, and any failure to do so could severely damage our reputation, which would have a material adverse effect on our business, financial condition, results of operations and prospects.
−Removed: Any loss of trust in our online presence could harm our reputation, and could result in consumers, merchants, brands, retailers, intellectual property holders and other participants reducing their levels of activity, which could materially reduce our revenue and profitability, if any.
−Removed: Our ability to maintain trust in our online capabilities will be based in large part upon:
−Removed: the quality, value and functionality of products and services offered;
−Removed: the reliability and integrity of our company and our e-commerce websites, as well as of the merchants,
−Removed: software developers, logistics providers, service providers, intellectual property holders and other participants in our ecosystem;
−Removed: our commitment to high levels of service;
−Removed: the safety, security and integrity of the data on our systems, and those of other participants on our e-commerce websites;
−Removed: the strength of our measures to protect consumers and intellectual property rights owners;
−Removed: our ability to provide reliable and trusted payment and escrow services through our arrangements with third party service providers.
−Removed: Our current plans contemplate that we will expand our online marketing presence primarily via the Alibaba ecosystem.
−Removed: Any termination or material change in our relationship with Amazon or Alibaba could have a material adverse effect on our business, financial condition, results of operations and prospects.
−Removed: Any termination or material change in our relationship with Amazon or Alibaba could have a material adverse effect on our business, financial condition, results of operations and prospects.
−Removed: We expect that Alibaba will represent one of our primary online marketing channels.
−Removed: Any adverse development in our relationship with these online markets could result in an immediate and significant adverse impact in our online marketing presence, revenues, operating results and financial condition.
−Removed: It could also result in a loss of trust by consumers, merchants, brands, retailers, intellectual property holders and other participants reducing their levels of activity, which could further materially reduce our revenues and profitability, if any.
−Removed: We may not be able to maintain or grow our revenue or our business.
−Removed: Our revenue growth also depends on our ability to grow our core businesses, newly developed businesses, as well as businesses that we may acquire or which we may consolidate.
−Removed: We are exploring and will continue to explore in the future new business initiatives, including in industries and markets in which we have limited or no experience, as well as new business models, that may be untested.
−Removed: Developing new businesses, initiatives and models requires significant investments of time and resources, and may present new and difficult technological, operational and compliance challenges.
−Removed: Particularly in the e-commerce space, we face various challenges while facilitating the convergence of online and offline retail and digitalization of offline business operations.
−Removed: Many of these challenges may be specific to business areas with which we do not have sufficient experience.
−Removed: Also, as we grow our direct sales businesses, we face new and increased risks, such as risks relating to inventory procurement and management, including failure to stock sufficient inventory to meet demands or additional costs or write-offs resulting from overstocking, supply chain management, accounts receivable and related potential impairment charges, as well as new and heightened regulatory requirements and increased liabilities to which we are subject as operators of direct sales businesses, including those relating to consumer protection, customs and permits and licenses, and allegations of unfair business practices.
−Removed: Failure to adequately address these and other risks and challenges relating to our direct sales business may harm our relationship with customers and consumers, adversely affect our business and results of operations and subject us to regulatory scrutiny or liabilities.
−Removed: We may encounter difficulties or setbacks in the execution of various growth strategies, and those strategies may not generate the returns we expect within the timeframe we anticipate, or at all.
−Removed: In addition, our overall revenue growth may slow, or our revenues may decline for other reasons, including increasing customer acquisition costs, increasing competition, disruptions to the global economy from pandemics, natural disasters or other events, as well as changes in the geopolitical landscape, government policies or general economic conditions.
−Removed: As our revenue grows to a higher base level, our revenue growth rate may slow in the future.
−Removed: If we are unable to compete effectively, our business, financial condition and results of operations would be materially and adversely affected.
−Removed: We face intense competition from established Internet companies, as well as from global and regional e-commerce players.
−Removed: These areas of our business are subject to rapid market change, the introduction of new business models, and the entry of new and well-funded competitors.
−Removed: Increased investments made and lower prices offered by our competitors may require us to divert significant managerial, financial and human resources to remain competitive, and ultimately may reduce our market share and negatively impact the profitability of our business.
−Removed: In addition, the development of new technologies and satellite systems, including Low Earth Orbit (LEO) constellations designed to deliver global satellite internet and support voice and data calls via mobile phones, may reduce the competitiveness of some of our products or render them obsolete in the future.
−Removed: Our ability to compete depends on several factors, some of which may be beyond our control, including alliances, acquisitions or consolidations within our industries that may result in stronger competitors, technological advances, shifts in customer preferences and changes in the regulatory environment in the markets we operate.
−Removed: Existing and new competitors may leverage their established platforms or market positions, or introduce innovative business models or technologies, to launch highly engaging content, products or services that may attract a large user base and achieve rapid growth, which may make it more challenging for us to acquire new customers and materially and adversely affect our business expansion and results of operations.
−Removed: If we are not able to compete effectively, the level of economic activity and user engagement in our ecosystem may decrease and our market share and profitability may be negatively affected, which could materially and adversely affect our business, financial condition and results of operations, as well as our reputation and brand.
−Removed: We may not be able to maintain and improve our online marketing, which could negatively affect our business and prospects.
−Removed: Our ability to maintain a healthy and vibrant ecosystem among consumers, merchants, brands, retailers, Intellectual Property holders and other participants is critical to our success.
−Removed: The extent to which we are able to create, maintain and strengthen these market channels depends on our ability to:
−Removed: offer secure and open e-commerce websites for all participants and balance the interests of these participants;
−Removed: provide a wide range of high-quality product offerings to consumers;
−Removed: attract and retain a wide range of consumers, merchants, brands and retailers;
−Removed: provide effective technologies, infrastructure and services that meet the evolving needs of consumers, merchants, brands, retailers and other ecosystem participants;
−Removed: arrange secure and trusted payment settlement services;
−Removed: address user concerns with respect to data security and privacy;
−Removed: improve our logistics data and coordinate fulfillment and delivery services with logistics service providers;
−Removed: attract and retain third-party service providers that are able to provide quality services on commercially reasonable terms to our merchants, brands, retailers and other ecosystem participants;
−Removed: maintain the quality of our customer service;
−Removed: continue adapting to the changing demands of the market.
−Removed: In addition, changes we make to our current operations to enhance and improve our online presence or to comply with regulatory requirements may be viewed positively from one participant group’s perspective, such as consumers, but may have negative effects from another group’s perspective, such as merchants.
−Removed: If we fail to balance the interests of all participants in our ecosystem, consumers, merchants, brands, retailers and other participants may spend less time, mind share and resources on our platforms and may conduct fewer transactions or use alternative platforms, any of which could result in a material decrease in our revenue and net income.
−Removed: If we are not able to continue to innovate or if we fail to adapt to changes in our various industries, our business, financial condition and results of operations would be materially and adversely affected.
−Removed: The e-commerce business is subject to rapidly changing technology, evolving industry standards, new mobile apps and protocols, new products and services, new media and entertainment content – including user-generated content – and changing user demands and trends.
−Removed: Furthermore, our domestic and international competitors are continuously developing innovations in personalized search and recommendation, online shopping and marketing, communications, social networking, entertainment, logistics and other services, to enhance user experience.
−Removed: The changes and developments taking place in our industry may also require us to re-evaluate our business model and adopt significant changes to our long-term strategies and business plans.
−Removed: Our failure to innovate and adapt to these changes and developments in a timely manner could have a material adverse effect on our business, financial condition and results of operations.
−Removed: Even if we timely innovate and adopt changes in our strategies and plans, we may nevertheless fail to realize the anticipated benefits of these changes or even generate lower levels of revenue as a result.
−Removed: Our failure to manage the significant management, operational and financial challenges involved in growing our business and operations could harm us.
−Removed: If we are successful in implementing our plans, our business will become increasingly complex as the scale, diversity and geographic coverage of our business and our workforce continue to expand through both organic growth and acquisitions.
−Removed: This expansion will place a significant strain on our management, operational and financial resources.
−Removed: The challenges involved in expanding our businesses require our employees to handle new and expanded responsibilities and duties.
−Removed: If our employees fail to adapt to the expansion or if we are unsuccessful in hiring, training, managing and integrating new employees or retraining and expanding the roles of our existing employees, our business, financial condition and results of operations may be materially harmed.
−Removed: Moreover, our current and planned staffing, systems, policies, procedures and controls may not be adequate to support our future operations.
−Removed: To effectively manage continuing expansion and growth of our operations and workforce, we will need to continue to improve our personnel management, transaction processing, operational and financial systems, policies, procedures and controls, which could be particularly challenging as we acquire new operations with different and incompatible systems in new industries or geographic areas.
−Removed: These efforts will require significant managerial, financial and human resources.
−Removed: There can be no assurance that we will be able to effectively manage our growth or to implement all these systems, policies, procedures and control measures successfully.
−Removed: If we are not able to manage our growth effectively, our business and prospects may be materially and adversely affected.
−Removed: We face risks relating to our acquisitions, investments and alliances.
−Removed: We expect to evaluate and consider a wide array of potential strategic transactions as part of our overall business strategy, including business combinations, acquisitions of businesses, technologies, services, products and other assets, as well as strategic investments, joint ventures, licenses and alliances.
−Removed: At any given time, we may be engaged in discussing or negotiating a range of these types of transactions.
−Removed: These transactions involve significant challenges and risks, including:
−Removed: difficulties in, and significant and unanticipated additional costs and expenses resulting from, integrating into our business the large number of personnel, operations, products, services, technology, internal controls and financial reporting of the businesses we acquire;
−Removed: disruption of our ongoing business, distraction of and significant time and attention required from our management and employees and increases in our expenses;
−Removed: departure of skilled professionals and proven management teams of acquired businesses, as well as the loss of established client relationships of those businesses we invest in or acquire;
−Removed: for investments over which we may not obtain management and operational control, we may lack influence over the controlling partners or shareholders, or may not have aligned interests with those of our partners or other shareholders;
−Removed: additional or conflicting regulatory requirements, heightened restrictions on and scrutiny of investments, acquisitions and foreign ownership in other jurisdictions, on national security grounds or for other reasons, regulatory requirements such as filings and approvals under the anti-monopoly and competition laws, rules and regulations, the risk that acquisitions or investments may fail to close, due to political and regulatory challenges or protectionist policies, as well as related compliance and publicity risks;
−Removed: actual or alleged misconduct, unscrupulous business practices or non-compliance by us or any company we acquire or invest in or by its affiliates or current or former employees, whether before, during or after our acquisition or investments;
−Removed: difficulties in identifying and selecting appropriate targets and strategic partners, including potential loss of opportunities for strategic transactions with competitors of our investee companies and strategic partners;
−Removed: difficulties in conducting sufficient and effective due diligence on potential targets and unforeseen or hidden liabilities or additional incidences of non-compliance, operating losses, costs and expenses that may adversely affect us following our acquisitions or investments or other strategic transactions.
−Removed: These and other risks could lead to negative publicity, increased regulatory scrutiny, litigation, government inquiries, investigations, actions or penalties against us and the companies we invest in or acquire on the ground of non-compliance with regulatory requirements, or even against our other businesses, and may force us to incur significant additional expenses and allocate significant management and human resources to rectify or improve these companies’ corporate governance standards, disclosure controls and procedures or internal controls and systems.
−Removed: As a result, we may experience significant difficulties and uncertainties carrying out investments and acquisitions, and our growth strategy, reputation and/or the trading prices of our securities may be materially and adversely affected.
−Removed: We face challenges in expanding our international and cross-border businesses and operations.
−Removed: In addition to risks that generally apply to our acquisitions and investments, we face risks associated with expanding into an increasing number of markets where we have limited or no experience, we may be less well-known or have fewer local resources and we may need to localize our business practices, culture and operations.
−Removed: We also face protectionist or national security policies that could, among other things, hinder our ability to execute our business strategies and put us at a competitive disadvantage relative to domestic companies in other jurisdictions.
−Removed: In addition, compliance with cross-border e-commerce tax laws that apply to our businesses will also affect a number of our businesses, increase our compliance costs and subject us to additional risks.
−Removed: Failure to manage these risks and challenges could negatively affect our ability to expand our international and cross-border businesses and operations as well as materially and adversely affect our business, financial condition and results of operations.
−Removed: We are heavily reliant on Charles Fernandez, our Executive Chairman and Chief Executive Officer, and the departure or loss of Mr.
−Removed: Fernandez could disrupt our business.
−Removed: The Company depends heavily on the continued efforts of Charles Fernandez, our Executive Chairman and Chief Executive Officer.
−Removed: Fernandez’s services are essential to the Company’s strategic vision and would be difficult to replace.
−Removed: The departure or loss of Mr.
−Removed: Fernandez, or the inability to timely hire and retain a qualified replacement, could negatively impact the Company’s ability to manage its business.
−Removed: We are heavily reliant on David Phipps, our President and Chief Executive Officer of Global Operations and a director, and the departure or loss of David Phipps could disrupt our business.
−Removed: The Company depends heavily on the continued efforts of David Phipps, our President and Chief Executive Officer of Global Operations and a director.
−Removed: Phipps is the founder of Global Telesat Communications LTD (“GTC”) and is essential to the Company’s day-to-day operations and would be difficult to replace.
−Removed: The departure or loss of Mr.
−Removed: Phipps, or the inability to timely hire and retain a qualified replacement, could negatively impact the Company’s ability to manage its business.
−Removed: If we are unable to recruit and retain key management, technical and sales personnel, our business would be negatively affected.
−Removed: For our business to be successful, we need to attract and retain highly qualified technical, management and sales personnel.
−Removed: The failure to recruit additional key personnel when needed with specific qualifications and on acceptable terms or to retain good relationships with our partners might impede our ability to continue to develop, commercialize and sell our products.
−Removed: To the extent the demand for skilled personnel exceeds supply, we could experience higher labor, recruiting and training costs in order to attract and retain such employees.
−Removed: We face competition for qualified personnel from other companies with significantly more resources available to them and thus may not be able to attract the level of personnel needed for our business to succeed.
−Removed: We depend on key management as well as experienced and capable personnel generally, and any failure to attract, motivate and retain our staff could severely hinder our ability to maintain and grow our business.
−Removed: Our future success is significantly dependent upon the continued service of our key executives and other key employees, particularly in new business areas we are expanding into.
−Removed: If we lose the services of any member of management or key personnel, we may not be able to locate suitable or qualified replacements and may incur additional expenses to recruit and train new staff.
−Removed: As our business develops and evolves, it may become difficult for us to continue to retain our employees.
−Removed: A number of our employees, including many members of management, may choose to pursue other opportunities outside of us.
−Removed: If we are unable to motivate or retain these employees, our business may be severely disrupted, and our prospects could suffer.
−Removed: The size and scope of our ecosystem also requires us to hire and retain a wide range of capable and experienced personnel who can adapt to a dynamic, competitive and challenging business environment.
−Removed: We will need to continue to attract and retain experienced and capable personnel at all levels, including members of management, as we expand our business and operations.
−Removed: Our various incentive initiatives may not be sufficient to retain our management and employees.
−Removed: Demand for talent in our industry is intense, and the availability of suitable and qualified candidates is limited.
−Removed: Competing demand for qualified personnel could cause us to offer higher compensation and other benefits to attract and retain them.
−Removed: Even if we were to offer higher compensation and other benefits, there can be no assurance that these individuals will choose to join or continue to work for us.
−Removed: Any failure to attract or retain key management and personnel could severely disrupt our business and growth.
−Removed: Failure to deal effectively with fraudulent or illegal activities by our employees, business partners or service providers would harm our business.
−Removed: Illegal, fraudulent, corrupt or collusive activities or misconduct, whether actual or perceived, by our employees could subject us to liability or negative publicity, which could severely damage our brand and reputation.
−Removed: We will implement internal controls and policies with regard to the review and approval of merchant accounts, interactions with business partners and government officials, account management, sales activities, data security and other relevant matters.
−Removed: However, there can be no assurance that our controls and policies will prevent fraud, corrupt or illegal activity or misconduct by our employees or that similar incidents will not occur in the future.
−Removed: As we expand our operations, in particular our businesses that provide services to governments and public institutions, we are subject to additional internal control and compliance requirements relating to corrupt and other illegal practices by our employees, and we may also be held liable for misconduct by our business partners and service providers.
−Removed: Failure to comply or ensure our employees, business partners and service providers to comply with these requirements, whether alleged or actual, could subject us to regulatory investigations and liabilities, which would materially and adversely affect our business operations, customer relationships, reputation and the trading price of our securities.
−Removed: If the logistics service providers used by our merchants fail to provide reliable logistics services, our business and prospects, as well as our financial condition and results of operations, may be materially and adversely affected.
−Removed: Interruptions to or failures in logistics services could prevent the timely or proper delivery of products to consumers, which would negatively impact on our competitive position as well as harm the reputation of our ecosystem and the businesses we operate.
−Removed: These interruptions or failures may be due to events that are beyond the control of any of these logistics service providers, such as inclement weather, natural disasters, pandemics or epidemics, accidents, transportation disruptions, including special or temporary restrictions or closings of facilities or transportation networks due to regulatory or political reasons, or labor unrest or shortages.
−Removed: These logistics services could also be affected or interrupted by business disputes, industry consolidation, insolvency or government shutdowns.
−Removed: The merchants in our ecosystem may not be able to find alternative logistics service providers to provide logistics services in a timely and reliable manner, or at all.
−Removed: If the products sold by merchants in our ecosystem are not delivered in proper condition, on a timely basis or at shipping rates that are commercially acceptable to marketplace participants, our business and prospects, as well as our financial condition and results of operations could be materially and adversely affected.
−Removed: Failure to deal effectively with any fraud perpetrated and fictitious transactions conducted in our ecosystem, and other sources of customer dissatisfaction, would harm our business.
−Removed: Although we are implementing various measures to detect and reduce the occurrence of fraudulent activities in connection with other businesses we operate, there can be no assurance that these measures will be effective in combating fraudulent transactions or improving overall satisfaction among our consumers, merchants and other participants.
−Removed: Additional measures that we take to address fraud could also negatively affect the attractiveness of our marketplaces and other businesses we operate to consumers or merchants.
−Removed: In addition, merchants in our marketplaces contribute to a fund to provide consumer protection guarantees.
−Removed: If our merchants do not perform their obligations under these programs, we may use funds that have been deposited by merchants in a consumer protection fund to compensate consumers.
−Removed: If the amounts in the fund are not sufficient, we may choose to compensate consumers for losses, although currently we are not legally obligated to do so.
−Removed: If, as a result of regulatory developments, we are required to compensate consumers, we will incur additional expenses.
−Removed: Although we have recourse against our merchants for any amounts we incur, there can be no assurance that we would be able to collect these amounts from our merchants.
−Removed: Government authorities, industry watchdog organizations or other third parties may issue reports or engage in other forms of public communications concerning alleged fraudulent or deceptive conduct on our platforms.
−Removed: Negative publicity and user sentiment generated as a result of these reports or allegations could severely diminish consumer confidence in and use of our services, reduce our ability to attract new or retain current merchants, consumers and other participants, damage our reputation, result in shareholder or other litigation, diminish the value of our brand, and materially and adversely affect our business, financial condition and results of operations.
−Removed: Our e-commerce platforms could be disrupted by network interruptions.
−Removed: Our e-commerce platforms depend on the efficient and uninterrupted operation of our computer and communications systems.
−Removed: System interruptions and delays may prevent us from efficiently processing the large volume of transactions on our marketplaces and other businesses we operate.
−Removed: Despite any precautions we may take, the occurrence of a natural disaster or other unanticipated problems at our facilities, including power outages, system failures, telecommunications delays or failures, construction accidents, break-ins to IT systems, computer viruses or human errors, could result in delays in or temporary outages of our platforms or services, loss of our, consumers’ and customers’ data and business interruption for us and our customers.
−Removed: Any of these events could damage our reputation, significantly disrupt our operations and the operations of the participants in our ecosystem and subject us to liability, heightened regulatory scrutiny and increased costs, which could materially and adversely affect our business, financial condition and results of operations.
−Removed: Natural disasters or terrorist attacks could have an adverse effect on our business.
−Removed: Natural disasters, terrorist acts or acts of war may cause equipment failures or disrupt our systems and operations.
−Removed: A failure to protect the privacy of customer and employee confidential data against breaches of network or IT security could result in damage to our reputation.
−Removed: Security breaches and attacks against our systems and network, and any potentially resulting breach or failure to otherwise protect personal, confidential and proprietary information, could damage our reputation and negatively impact our business, as well as materially and adversely affect our financial condition and results of operations.
−Removed: Our cybersecurity measures may not detect, prevent or control all attempts to compromise our systems or risks to our systems, including distributed denial-of-service attacks, viruses, Trojan horses, malicious software, break-ins, phishing attacks, third-party manipulation, security breaches, employee misconduct or negligence or other attacks, risks, data leakage and similar disruptions that may jeopardize the security of data stored in and transmitted by our systems or that we otherwise maintain.
−Removed: Breaches or failures of our cybersecurity measures could result in unauthorized access to our systems, misappropriation of information or data, deletion or modification of user information, or denial-of-service or other interruptions to our business operations.
−Removed: In addition, breaches or failures of the systems and cybersecurity measures of our third-party service providers could also result in unauthorized access to our data and user information.
−Removed: As techniques used to obtain unauthorized access to or sabotage systems change frequently and may not be known until launched against us or our third-party service providers, there can be no assurance that we will be able to anticipate, or implement adequate measures to protect against, these attacks.
−Removed: Moreover, if the security of domain names is compromised, we will be unable to use the domain names in our business operations, which could materially and adversely affect our business operations, reputation and brand image.
−Removed: If we fail to implement adequate encryption of data transmitted through the networks of the telecommunications and Internet operators we rely upon, there is a risk that telecommunications and Internet operators or their business partners may misappropriate our data, which could materially and adversely affect our business operations and reputation.
−Removed: Non-compliance with, or changes in, the legal and regulatory environment in the countries in which we operate could increase our costs or reduce our net operating revenues.
−Removed: Our business is subject to various laws and regulations in the US and in the countries throughout the world in which we do business, including laws and regulations relating to commerce, intellectual property, trade, environmental, health and safety, commerce and contracts, privacy and communications, consumer protection, web services, tax, and state corporate laws and securities laws;
−Removed: and specifically in the communications equipment industry, many of which are still evolving and could be interpreted in ways that could harm our business.
−Removed: There is no assurance that we will be completely effective in ensuring our compliance with all applicable laws and regulations.
−Removed: Changes in applicable laws or regulations or evolving interpretations thereof, including increased government regulations, may result in increased compliance costs, capital expenditures and other financial obligations for us and could affect our profitability or impede the production or distribution of our products, which could affect our net operating revenues.
−Removed: Tightening of tax compliance efforts that affect our merchants could materially and adversely affect our business, financial condition and results of operations.
−Removed: Tax legislation relating to the ecosystem is still developing.
−Removed: Governments may promulgate or strengthen the implementation of tax regulations that impose obligations on e-commerce companies, which could increase the costs to consumers and merchants and make our platforms less competitive in these jurisdictions.
−Removed: Governments may require e-commerce companies to assist in the enforcement of tax registration requirements and the collection of taxes with respect to the revenue or profit generated by merchants from transactions conducted on their platforms.
−Removed: We may also be requested by tax authorities to supply information about our merchants, such as transaction records and bank account information, and assist in the enforcement of other tax regulations, including the payment and withholding obligations against our merchants.
−Removed: As a result of more stringent tax compliance requirements and liabilities, we may lose existing merchants and potential merchants might not be willing to open storefronts on our marketplaces, which could in turn negatively affect us.
−Removed: Stricter tax enforcement by tax authorities may also reduce the activities by merchants on our platforms and result in liability to us.
−Removed: Any heightened tax law enforcement against participants in our marketing platforms (including imposition of reporting or withholding obligations on operators of marketplaces with respect to VAT of merchants and stricter tax enforcement against merchants generally) could have a material adverse effect on our business, financial condition and results of operations.
−Removed: We may be subject to claims under consumer protection laws, including health and safety claims and product liability claims, if property or people are harmed by the products and services sold through our platforms.
−Removed: Government authorities place high importance on consumer protection.
−Removed: Moreover, as part of our growth strategy, we expect to increase our focus on food, food delivery, food supplements and beverages, mother care, cosmetics, baby care, pharmaceutical and healthcare products and services, as well as electronics products, both as a platform operator and as part of our directly operated business.
−Removed: We have also invested in companies involved in these sectors.
−Removed: These activities could pose increasing challenges to our internal control and compliance systems and procedures, including our control over and management of third-party service personnel, and expose us to substantial increasing liability, negative publicity and reputational damage arising from consumer complaints, harms to personal health or safety or accidents involving products or services offered through our platforms or provided by us.
−Removed: Operators of e-commerce platforms are subject to certain provisions of consumer protection laws even where the operator is not the merchant of the product or service purchased by the consumer.
−Removed: In addition, if we do not take appropriate remedial action against merchants or service providers for actions, they engage in that we know, or should have known, would infringe upon the rights and interests of consumers, we may be held jointly liable for infringement alongside the merchant or service provider.
−Removed: We may also face increasing scrutiny from consumer protection regulators and activists, as well as increasingly become a target for litigation, in the United States, Europe and other jurisdictions.
−Removed: Consumer complaints and associated negative publicity could materially and adversely harm our reputation and affect our business expansion.
−Removed: Claims brought against us under consumer protection laws, even if unsuccessful, could result in significant expenditure of funds and diversion of management time and resources, which could materially and adversely affect our business operations, net income and profitability.
−Removed: Our business activities may be subject to the Foreign Corrupt Practices Act ( “ FCPA ” ), the UK Bribery Act 2010 ( “ UK Bribery Act ” ), and other similar anti-bribery and anti-corruption laws of other countries in which we operate.
−Removed: We have conducted and have ongoing business operations in international locations, and may in the future initiate business operations in additional countries other than the U.S.
−Removed: Our business activities may be subject to the FCPA, the UK Bribery Act and other similar anti-bribery or anti-corruption laws, regulations or rules of other countries in which we operate.
−Removed: The FCPA generally prohibits offering, promising, giving or authorizing others to give anything of value, either directly or indirectly, to a non-U.S.
−Removed: government official in order to influence official action or otherwise obtain or retain business.
−Removed: The FCPA also requires public companies to make and keep books and records that accurately and fairly reflect the transactions of the corporation and to devise and maintain an adequate system of internal accounting controls.
−Removed: Our business is regulated and therefore involves interaction with public officials, including officials of non-U.S.
−Removed: There is no certainty that all of our employees, agents or contractors, or those of our affiliates, will comply with all applicable laws and regulations, particularly given the high level of complexity of these laws.
−Removed: Violations of these laws and regulations could result in fines, criminal sanctions against us, our officers or our employees, the closing down of our facilities, requirements to obtain export licenses, cessation of business activities in sanctioned countries, implementation of compliance programs and prohibitions on the conduct of our business.
−Removed: Any such violations could include prohibitions on our ability to offer our products in one or more countries and could materially damage our reputation, our brand, our international expansion efforts, our ability to attract and retain employees and our business, prospects, operating results and financial condition.
−Removed: Our reputation, our brand and our business may be harmed by aggressive marketing and communications strategies of our competitors.
−Removed: Due to intense competition in our industry, we have been and may be the target of incomplete, inaccurate and false statements and complaints about us and our products and services that could damage our reputation and brand and materially deter consumers and customers from spending in our ecosystem.
−Removed: In addition, competitors have used, and may continue to use, methods such as lodging complaints with regulators, initiating frivolous and nuisance lawsuits, and other forms of attack litigation and “lawfare” that attempt to harm our reputation and brand, hinder our operations, force us to expend resources on responding to and defending against these claims, and otherwise gain a competitive advantage over us by means of litigious and accusatory behavior.
−Removed: Our ability to respond on share price-sensitive information to our competitors’ misleading marketing efforts, including lawfare, may be limited during our self-imposed quiet periods around quarter ends consistent with our internal policies or due to legal prohibitions on permissible public communications by us during certain other periods.
−Removed: Risks Related to Doing Business in China
−Removed: Our current business expansion involves an increase in the business we do in China.
−Removed: Changes in China ’ s economic, political or social conditions or government policies could have a material adverse effect on our business, financial conditions and results of operations.
−Removed: We currently market our products and services in China, and may establish operations in China at a future time, all of which may expose our business, prospects, financial condition and results of operations to an increasingly significant extent to political, economic, and social conditions in China generally.
−Removed: The Chinese economy differs from the economies of most developed countries in many respects, including the degree of government involvement, level of development, growth rate, control of foreign exchange and allocation of resources.
−Removed: Although the Chinese government has implemented measures emphasizing the utilization of market forces for economic reform, the reduction of state ownership of productive assets and the establishment of improved corporate governance in business enterprises, a substantial portion of productive assets in China are still owned or controlled by the government.
−Removed: In addition, the Chinese government continues to play a significant role in regulating industry development by imposing industrial policies.
−Removed: The Chinese government also exercises significant control over China’s economic growth by allocating resources, controlling payment of foreign currency-denominated obligations, setting monetary policy and providing preferential treatment to industries or companies.
−Removed: While the Chinese economy has experienced significant growth over the past decades, growth has been uneven, both geographically and in various sectors of the economy.
−Removed: The Chinese government has implemented various measures to encourage economic growth and guide the allocation of resources.
−Removed: Some of these measures may benefit the overall Chinese economy but may have a negative effect on us.
−Removed: For example, our financial condition and results of operations may be adversely affected by government control over capital investments or changes in tax regulations.
−Removed: Any prolonged slowdown in the Chinese economy may reduce the demand for our products and services and materially and adversely affect our business and results of operations.
−Removed: Uncertainties with respect to the PRC legal system could adversely affect us.
−Removed: The Peoples Republic of China (“PRC” or “China”) legal system is a civil law system based on written statutes, where prior court decisions have limited precedential value.
−Removed: The PRC legal system is evolving rapidly, and the interpretations of many laws, regulations and rules may contain inconsistencies and enforcement of these laws, regulations and rules involves uncertainties.
−Removed: Although we have taken measures to comply with the laws and regulations applicable to our business operations and to avoid conducting any non-compliant activities under these laws and regulations, the PRC governmental authorities may promulgate new laws and regulations regulating our business.
−Removed: Moreover, developments in our industry may lead to changes in PRC laws, regulations and policies or in the interpretation and application of existing laws, regulations and policies.
−Removed: As a result, we may be required by the regulators to upgrade the licenses or permits we may obtain, to obtain additional licenses, permits, approvals, to complete additional filings or registrations for the services we provide, or to modify our business practices.
−Removed: Any failure to upgrade, obtain or maintain such licenses, permits, filings or approvals or requirement to modify our business practices may subject us to various penalties, including, among others, the confiscation of revenues and imposition of fines.
−Removed: We cannot assure you that our business operations would not be deemed to violate any existing or future PRC laws or regulations, which in turn may limit or restrict us, and could materially and adversely affect our business and operations.
−Removed: From time to time, we may have to resort to administrative and court proceedings to enforce our legal rights.
−Removed: However, since PRC judicial and administrative authorities have significant discretion in interpreting and implementing statutory and contractual terms, it may be more difficult to predict the outcome of a judicial or administrative proceeding than in more developed legal systems.
−Removed: These uncertainties may impede our ability to enforce the contracts we have entered and could materially and adversely affect our business and the results of operations.
−Removed: Furthermore, the PRC legal system is based, in part, on government policies and internal rules, some of which are not published in a timely manner, or at all, but which may have retroactive effect.
−Removed: As a result, we may not always be aware of any potential violation of these policies and rules.
−Removed: Such unpredictability regarding our contractual, property (including intellectual property) and procedural rights could adversely affect our business and impede our ability to continue our operations.
−Removed: Recent litigation and negative publicity surrounding China-based companies listed in the United States may negatively impact the trading price of our securities.
−Removed: We believe that recent litigation and negative publicity surrounding companies with operations in China that are listed in the United States have negatively impacted the stock prices of these companies.
−Removed: Certain politicians in the United States have publicly warned investors to shun China-based companies listed in the United States.
−Removed: The SEC and the Public Company Accounting Oversight Board (United States), or the PCAOB, also issued a joint statement on April 21, 2020, reiterating the disclosure, financial reporting and other risks involved in the investments in companies that are based in emerging markets as well as the limited remedies available to investors who might take legal action against such companies.
−Removed: Furthermore, various equity-based research organizations have recently published reports on China-based companies after examining their corporate governance practices, related party transactions, sales practices and financial statements, and these reports have led to special investigations and listing suspensions on U.S.
−Removed: national exchanges.
−Removed: Any similar scrutiny on us, regardless of its lack of merit, could cause the market price of our securities to fall, divert management resources and energy, cause us to incur expenses in defending ourselves against rumors, and increase the premiums we pay for director and officer insurance.
−Removed: Fluctuations in exchange rates could have a material and adverse effect on the results of our operations and the value of your investment.
−Removed: The conversion of Renminbi, the official currency of China, into foreign currencies, including U.S.
−Removed: dollars, is based on rates set by the People’s Bank of China.
−Removed: The Renminbi has fluctuated against the U.S.
−Removed: dollar, at times significantly and unpredictably.
−Removed: The value of Renminbi against the U.S.
−Removed: dollar and other currencies is affected by changes in China’s political and economic conditions and by China’s foreign exchange policies, among other things.
−Removed: We cannot assure you that Renminbi will not appreciate or depreciate significantly in value against the U.S.
−Removed: dollar in the future.
−Removed: It is difficult to predict how market forces or PRC, or U.S.
−Removed: government policy may impact the exchange rate between Renminbi and the U.S.
−Removed: dollar in the future.
−Removed: Any significant appreciation or depreciation of Renminbi may materially and adversely affect our revenues, earnings and financial position, and the value of our securities.
−Removed: For example, to the extent that we need to convert Renminbi we receive in payment for products and services into U.S.
−Removed: dollars to pay our operating expenses, depreciation of Renminbi against the U.S.
−Removed: dollar would have an adverse effect on the amount of the U.S.
−Removed: dollars we would receive from the conversion.
−Removed: Conversely, a significant depreciation of Renminbi against the U.S.
−Removed: dollar may significantly reduce the U.S.
−Removed: dollar equivalent of our earnings, which in turn could adversely affect the price of our securities.
−Removed: In addition, our currency exchange losses may be magnified by PRC exchange control regulations that restrict our ability to convert Renminbi into other currencies, such as the U.S.
−Removed: As a result, fluctuations in exchange rates may have a material adverse effect on your investment.
−Removed: Governmental control of currency conversion may limit our ability to utilize our revenues effectively and affect the value of your investment.
−Removed: The PRC government imposes controls on the convertibility of the RMB into foreign currencies and, in certain cases, the remittance of currency out of China.
−Removed: Approval from or registration with appropriate government authorities or delegated banks is required where RMB is to be converted into foreign currency and remitted out of China to pay capital expenses such as the repayment of loans denominated in foreign currencies.
−Removed: The PRC government may also at its discretion restrict access in the future to foreign currencies for current account transactions.
−Removed: If the foreign exchange control system prevents us from obtaining sufficient currency to satisfy our US or PRC currency demands, our operations could be adversely affected.
−Removed: Risks Related to Our Healthcare Business
−Removed: We derive a significant portion of our sales from prescription drug sales reimbursed by pharmacy benefit management companies.
−Removed: We derive a significant portion of our sales from prescription drug sales reimbursed through prescription drug plans administered by PBM companies.
−Removed: PBM companies typically administer multiple prescription drug plans that expire at various times and provide for varying reimbursement rates.
−Removed: There can be no assurance that we will continue to participate in any PBM network at any future time.
−Removed: If our participation in the prescription drug programs administered by one or more of the large PBM companies is restricted or terminated, we expect that our sales would be adversely affected, at least in the short-term.
−Removed: The Company or the PBM may terminate the network participation agreement at any time by way of advance notice to the other party.
−Removed: If we are unable to replace any such lost sales, either through an increase in other sales or through a resumption of participation in those plans, our operating results may be materially adversely affected.
−Removed: When we exit a pharmacy provider network and later resume network participation, there can be no assurance that we will achieve any level of business on any pace, or that all clients of the PBM sponsor of the network will choose to include us again in their pharmacy network initially or at all.
−Removed: In addition, in such circumstances we may incur increased marketing and other costs about initiatives to regain former patients and attract new patients covered by in-network plans.
−Removed: Efforts to reduce reimbursement levels and alter health care financing practices could adversely affect our businesses.
−Removed: The continued efforts of health maintenance organizations, managed care organizations, other companies, government entities, and other third-party payors to reduce prescription drug costs and pharmacy reimbursement rates may impact our profitability.
−Removed: Increased utilization of generic pharmaceuticals, which normally yield a higher gross profit rate than equivalent brand-named drugs, has resulted in a decrease in reimbursement payments to retail and mail order pharmacies for generic drugs through the imposition by third-party payors of generic effective rates that have caused a reduction in the generic profit rate.
−Removed: We expect pricing pressures from third-party payors to continue given the high and increasing costs of specialty drugs.
−Removed: As a result of this industry-wide pressure, we also may see profit margins on our contracts continue to compress, which may adversely affect our profitability.
−Removed: PBM fees, including Direct and Indirect Remuneration (“DIR”) fees, transaction charges and network access fees, applied significant downward pressure on our profitability.
−Removed: DIR fees are often calculated and charged several months after adjudication of a claim, which adversely impacts our profitability.
−Removed: These fees lack transparency and are extremely difficult to predict and accrue.
−Removed: DIR fees are sometimes retroactively “clawed back” by the PBMs with little or no warning at the end of a quarter, which has a significant downward effect on our gross margins.
−Removed: Retroactive contractual adjustments may be imposed on the pharmacies through execution of new contracts between pharmacy services administration organizations and PBMs with retroactive effectiveness.
−Removed: These contractual adjustments typically impose new lowered effective rate calculations on previously dispensed medications resulting in a PBM overpayment, which is later recouped with or without notice to the pharmacy.
−Removed: DIR fees and other PBM fees are generally not disclosed at adjudication and may change throughout the year.
−Removed: These adjustments and the resultant fees may not be predictable or avoidable and can adversely affect our revenues, cash flow, and profitability.
−Removed: In addition, during the past several years, the U.S.
−Removed: health care industry has been subject to an increase in governmental regulation at both the federal and state levels.
−Removed: Efforts to control health care costs, including prescription drug costs, are underway at the federal and state government levels.
−Removed: Changing political, economic, and regulatory influences may affect health care financing and reimbursement practices.
−Removed: If the current health care financing and reimbursement system changes significantly, our business, financial position and results of operations could be materially adversely affected .
−Removed: Quality measurement networks have a significant impact on our revenues.
−Removed: Quality measurement networks can be, but are not always, tied to DIR fees collected by PBMs.
−Removed: These networks designate specific metrics through which pharmacy performance is assessed.
−Removed: These metrics are disclosed along with benchmark guidance for quality or superior performance, which can lead to a return of the DIR fees by the PBMs in the form of performance bonuses.
−Removed: Failure to meet quality measures can result in loss of DIR fees collected and loss of PBM relationship.
−Removed: There is no guarantee that we will be successful in meeting quality review standards.
−Removed: Quality measurement networks are increasingly rigorous and can be based on comparative success against other pharmacies in the network.
−Removed: If other pharmacies out-perform our pharmacy or if we fail to meet quality metrics, our profitability can be adversely affected.
−Removed: A slowdown in the frequency and rate of the introduction of new prescription drugs as well as generic alternatives to brand name prescription products could adversely affect our business, financial position, and results of operations .
−Removed: The profitability of retail pharmacy businesses is dependent upon the utilization of prescription drug products.
−Removed: Generally, our pharmacies receive greater profit from generic drugs.
−Removed: Utilization trends are affected by the introduction of new and successful prescription pharmaceuticals as well as lower priced generic alternatives to existing brand name products.
−Removed: Accordingly, a slowdown in the introduction of new and successful prescription pharmaceuticals and/or generic alternatives could adversely affect our business, financial position and results of operations.
−Removed: Uncertainty regarding the impact of Medicare Part D may adversely affect our business, financial position and our results of operations.
−Removed: Since its inception in 2006, the Medicare drug benefit has resulted in increased utilization and decreased pharmacy gross margin rates as higher margin business, such as cash and state Medicaid customers, migrated to Medicare Part D coverage.
−Removed: To the extent this occurs, the adverse effects of the Medicare drug benefit may outweigh any opportunities for new business generated by the Medicare drug benefit.
−Removed: In addition, if the government alters Medicare program requirements or reduces funding because of the higher-than-anticipated cost to taxpayers of the Medicare drug benefit or for other reasons;
−Removed: or if we fail to design and maintain programs that are attractive to Medicare participants, our Medicare Part D services and the ability to expand our Medicare Part D services could be materially and adversely affected, and our business, financial position and results of operations may be adversely affected.
−Removed: Unexpected safety or efficacy concerns may arise from pharmaceutical products.
−Removed: Unexpected safety or efficacy concerns can arise with respect to pharmaceutical drugs dispensed at our pharmacies, whether or not scientifically justified, leading to product recalls, withdrawals or declining sales.
−Removed: If we fail to or do not promptly withdraw pharmaceutical drugs upon a recall by a drug manufacturer, our business and results of operations could be negatively impacted by reversals of pharmacy billings that will result in loss of revenue.
−Removed: Prescription volumes may decline, and our net revenues and ability to generate earnings may be negatively impacted, if products are withdrawn from the market or if increased safety risk profiles of specific drugs result in utilization decreases.
−Removed: We dispense significant volumes of drugs from our pharmacies.
−Removed: These volumes are the basis for our net revenues.
−Removed: When increased safety risk profiles of specific drugs or classes of drugs result in utilization decreases, physicians may cease writing or reduce the numbers of prescriptions written for these drugs.
−Removed: Additionally, negative press regarding drugs with higher safety risk profiles may result in reduced consumer demand for such drugs.
−Removed: On occasion, products are withdrawn by their manufacturers.
−Removed: In cases where there are no acceptable prescription drug equivalents or alternatives for these prescription drugs, our volumes, net revenues, profitability, and cash flows may decline.
−Removed: Certain risks are inherent in providing pharmacy services;
−Removed: our insurance may not be adequate to cover any claims against us.
−Removed: Pharmacies are exposed to risks inherent in the packaging and distribution of pharmaceutical products, such as with respect to improper filling of prescriptions, labeling of prescriptions, adequacy of warnings, unintentional distribution of counterfeit drugs and expiration of drugs.
−Removed: In addition, federal and state laws that require our pharmacists to offer counseling, without additional charge, to their customers about medication, dosage, delivery systems, common side effects and other information the pharmacists deem significant can impact our business.
−Removed: Our pharmacists may also have a duty to warn customers regarding any potential negative effects of a prescription drug if the warning could reduce or eliminate these effects.
−Removed: Although we maintain professional liability and errors and omissions liability insurance, from time to time, claims result in the payment of significant amounts, some portions of which are not funded by insurance.
−Removed: We cannot assure you that the coverage limits under our insurance programs will be adequate to protect us against future claims, or that we will be able to maintain this insurance on acceptable terms in the future.
−Removed: Our results of operations, financial condition or cash flows may be adversely affected if in the future our insurance coverage proves to be inadequate or unavailable or there is an increase in liability for which we self-insure or we suffer reputational harm as a result of an error or omission.
−Removed: Changes in industry pricing benchmarks could adversely affect our business, financial position and results of operations.
−Removed: Contracts in the prescription drug industry generally use certain published benchmarks to establish pricing for prescription drugs.
−Removed: These benchmarks include average wholesale price (“AWP”), average sales price and wholesale acquisition cost.
−Removed: Recent events have raised uncertainties as to whether payors, pharmacy providers, PBMs and others in the prescription drug industry will continue to utilize AWP as it has previously been calculated or whether other pricing benchmarks will be adopted for establishing prices within the industry.
−Removed: In some circumstances, such changes could also impact the reimbursement that we receive from Medicare or Medicaid programs for drugs covered by such programs and from MCOs that contract with government health programs to provide prescription drug benefits .
−Removed: Increases in our pharmaceutical costs could have a material adverse effect on the level of our medical costs and our results of operations.
−Removed: Introduction of new high-cost specialty drugs and sudden cost spikes for existing drugs increase the risk that the pharmacy cost assumptions used to develop our capitation rates are not adequate to cover the actual pharmacy costs, which jeopardizes the overall actuarial soundness of our rates.
−Removed: Bearing the high costs of new specialty drugs or the high-cost inflation of generic drugs without an appropriate rate adjustment or other reimbursement mechanism would have an adverse impact on our financial condition and results of operations.
−Removed: In addition, evolving regulations and state and federal mandates regarding coverage may impact the ability of our health plans to continue to receive existing price discounts on pharmaceutical products for our members.
−Removed: Other factors affecting our pharmaceutical costs include, but are not limited to, geographic variation in utilization of new and existing pharmaceuticals, changes in discounts, civil investigations, and litigation.
−Removed: Some of our competitors have been subject to substantial sanctions related to allegations of improper transfer pricing practices.
−Removed: Although we will continue to work with state Medicaid agencies in an effort to ensure that we receive appropriate and actuarially sound reimbursement for all new drug therapies and pharmaceuticals trends, there can be no assurance that we will be successful in that regard.
−Removed: The industries in which we operate are extremely competitive and competition could adversely affect our business, financial position, and results of operations.
−Removed: We operate in a highly competitive environment.
−Removed: As a pharmacy retailer, we compete with other drugstore chains, supermarkets, discount retailers, membership clubs, Internet companies and retail health clinics, as well as other mail order pharmacies.
−Removed: In that regard, many pharmacy benefits plans have implemented plan designs that mandate or provide incentives to fill maintenance medications through mail order pharmacies.
−Removed: To the extent this trend continues, our retail pharmacy business could be adversely affected.
−Removed: In addition, some of these competitors may offer services and pricing terms that we may not be willing or able to offer.
−Removed: Competition may also come from other sources in the future.
−Removed: Thus, competition could have an adverse effect on our business, financial position and results of operations.
−Removed: Existing and new government legislative and regulatory action could adversely affect our business, financial position and results of operations.
−Removed: The retail drugstore business is subject to numerous federal, state and local laws and regulations.
−Removed: Changes in these regulations may require extensive system and operating changes that may be difficult to implement.
−Removed: Untimely compliance or noncompliance with applicable laws and regulations could adversely affect the continued operation of our business, including, but not limited to:
−Removed: imposition of civil or criminal penalties;
−Removed: suspension of payments from government programs;
−Removed: loss of required government certifications or approvals;
−Removed: loss of authorizations to participate in or exclusion from government reimbursement programs, such as the Medicare and Medicaid programs;
−Removed: or loss of licensure.
−Removed: The regulations to which we are subject include, but are not limited to:
−Removed: the laws and regulations;
−Removed: accounting standards;
−Removed: tax laws and regulations;
−Removed: laws and regulations relating to the protection of the environment and health and safety matters, including those governing exposure to, and the management and disposal of, hazardous substances;
−Removed: and regulations of the FDA, the U.S.
−Removed: Federal Trade Commission, the Drug Enforcement Administration, and the Consumer Product Safety Commission, as well as state regulatory authorities, governing the sale, advertisement and promotion of products that we sell.
−Removed: In that regard, our business, financial position and results of operations could be affected by one or more of the following:
−Removed: federal and state laws and regulations governing the purchase, distribution, management, dispensing and reimbursement of prescription drugs and related services, whether at retail or mail, and applicable licensing requirements;
−Removed: the effect of the expiration of patents covering brand name drugs and the introduction of generic products;
−Removed: the frequency and rate of approvals by the FDA of new brand named and generic drugs, or of over-the-counter status for brand name drugs;
−Removed: FDA regulation affecting the retail pharmacy industry;
−Removed: rules and regulations issued pursuant to the HIPAA;
−Removed: and other federal and state laws affecting the use, disclosure and transmission of health information, such as state security breach laws and state laws limiting the use and disclosure of prescriber information;
−Removed: administration of the Medicare drug benefit, including legislative changes and/or CMS rulemaking and interpretation;
−Removed: government regulation of the development, administration, review and updating of formularies and drug lists;
−Removed: state laws and regulations establishing or changing prompt payment requirements for payments to retail pharmacies;
−Removed: impact of network access (any willing provider) legislation on ability to manage pharmacy networks;
−Removed: managed care reform and plan design legislation;
−Removed: insurance licensing and other insurance regulatory requirements applicable to offering prescription drug providers (“PDP”) about the Medicare drug benefit;
−Removed: direct regulation of pharmacies by regulatory and quasi-regulatory bodies;
−Removed: Federal government sequestration affecting Medicare Part B reimbursements.
−Removed: Changes in the health care regulatory environment may adversely affect our business.
−Removed: Future rulemaking could increase regulation of pharmacy services, result in changes to pharmacy reimbursement rates, and otherwise change the way we do business.
−Removed: We cannot predict the timing or impact of any future rulemaking, but any such rulemaking could have an adverse impact on our results of operations.
−Removed: The sustainability of our current business model is also dependent on the availability, pricing and rules and regulations relating to the dispensing of controlled medications.
−Removed: Changes that affect any of these variables could greatly impact our current revenue streams as well as alter our business structure and future plans for growth and development.
−Removed: Efforts to reform the U.S.
−Removed: health care system may adversely affect our financial performance.
−Removed: Congress periodically considers proposals to reform the U.S.
−Removed: health care system.
−Removed: These proposals may increase government involvement in health care and regulation of pharmacy services, or otherwise change the way we or our clients do business.
−Removed: Health plan sponsors may react to these proposals and the uncertainty surrounding them by reducing or delaying purchases of cost control mechanisms and related services that the combined company would provide.
−Removed: We cannot predict what effect, if any, these proposals may have on its retail and pharmacy services businesses.
−Removed: Other legislative or market-driven changes in the health care system that we cannot anticipate could also materially adversely affect our results of operations, financial position and/or cash flow from operations.
−Removed: If we are found to be in violation of Medicaid and Medicare reimbursement regulations, we could become subject to retroactive adjustments and recoupment, or exclusion from the Medicaid, Medicare programs, and PBM networks.
−Removed: As a Medicaid and Medicare provider, we are subject to retroactive adjustments due to prior-year audits, reviews and investigations, government fraud and abuse initiatives, and other similar actions.
−Removed: Federal regulations provide for withholding payments to recoup amounts payable under the programs and, in certain circumstances, allow for exclusion from Medicaid and Medicare.
−Removed: We cannot offer any assurance that, pursuant to such audits, reviews, investigations, or other proceedings, we will be found to be complying in all respects with such reimbursement regulations.
−Removed: A determination that we are in violation of any such reimbursement regulation could result in retroactive adjustments and recoupment of payments and have a material adverse effect on our financial condition and results of operations.
−Removed: As a Medicaid and Medicare provider, we are also subject to routine, unscheduled audits, and if any such audit results in a negative finding, finding, we may be subject to exclusions from Medicaid, Medicare, and other PBM networks, which would adversely affect our results of operations and financial condition.
−Removed: Our industry is subject to extensive government regulation, and noncompliance by us or our suppliers could harm our business.
−Removed: The repackaging, marketing, sale, and purchase of medications are extensively regulated by federal and state governments.
−Removed: In addition, many of the brand name and controlled medications that we sell receive greater attention from law enforcement officials than medications that are most often dispensed by traditional pharmacies due to the high cost of these medications and the potential for diversion and fraud, waste, and abuse.
−Removed: We sell common blood pressure, statin and other common drugs, and dispense either brand name or generic drugs according to the doctor’s prescription.
−Removed: If we fail to, or are accused of failing to, comply with applicable laws and regulations, we could be subject to penalties that may include exclusion from the Medicare or Medicaid programs, fines, requirements to change our practices, and civil or criminal penalties, which could harm our business, financial condition, and results of operations.
−Removed: Any disqualification from participating in Medicare or the state Medicaid programs would significantly reduce our net sales and our ability to maintain profitability.
−Removed: Our business could also be harmed if the entities with which we contract or have business relationships, such as pharmaceutical manufacturers, distributors, physicians, clinics, or home health agencies are accused of violating laws or regulations.
−Removed: While we believe that we are operating our business in substantial compliance with existing legal requirements material to the operation of our business, there are significant uncertainties involving the application of many of these legal requirements to our business.
−Removed: Changes in interpretation or enforcement policies could subject our current practices to allegations of impropriety or illegality.
−Removed: The applicable regulatory framework is complex and evolving, and the laws are very broad in scope.
−Removed: Many of the laws remain open to interpretation and have not been addressed by substantive court decisions to clarify their meaning.
−Removed: We are also unable to predict what additional federal or state legislation or regulatory initiatives may be enacted in the future relating to our business or the healthcare industry in general, or what effect any such legislation or regulation might have on us.
−Removed: Further, we cannot provide any assurance that federal or state governments will not impose additional restrictions or adopt interpretations of existing laws that could increase our cost of compliance with such laws or reduce our ability to remain profitable.
−Removed: Federal and state investigations and enforcement actions continue to focus on the healthcare industry, scrutinizing a wide range of items such as referral and billing practices, product discount arrangements, dissemination of confidential patient information, clinical drug research trials, pharmaceutical marketing programs, and gifts for patients.
−Removed: It is difficult to predict how any of the laws implicated in these investigations and enforcement actions may be interpreted to apply to our business.
−Removed: Any future investigation may cause publicity, regardless of the eventual result of the investigation, or its underlying merits, that would cause potential patients to avoid us, reducing our net sales and profits and causing our stock price to decline.
−Removed: Disruptions in the capital markets in the past have resulted in illiquidity in parts of the capital markets we serve.
−Removed: Our business is affected by the economy in general, including changes in consumer purchasing power, preferences and/or spending patterns.
−Removed: These changes could affect drug utilization trends as well as the financial health and number of covered lives of our clients, resulting in an adverse effect on our business, financial condition, results of operations and cash flows.
−Removed: Unfavorable economic conditions may cause a decline in drug utilization and dampen demand for pharmaceutical drugs and durable medical equipment as well as consumer demand for sundry products sold in our retail store and our business and financial results could be adversely affected.
−Removed: Further, interest rate fluctuations and changes in capital market conditions may affect our ability to obtain necessary financing on acceptable terms, our ability to secure suitable store locations under acceptable terms and our ability to execute sale or lease transactions under acceptable terms.
−Removed: If the products and services that we offer fail to meet customer needs, our sales may be affected.
−Removed: Our products and services must satisfy the needs and desires of our customers, whose preferences may change in the future.
−Removed: If we misjudge either the demand for products and services we provide or our customers’ purchasing habits and tastes, we may be faced with excess inventories of some products and missed opportunities for products and services we chose not to offer.
−Removed: In addition, our sales may decline, or we may be required to dispose of the inventory we have obtained at lower prices.
−Removed: This would have a negative effect on our business and results of operations.
−Removed: We are highly dependent on one supplier for our products, and a loss of that supplier may adversely impact our ability to sell products to our customers.
−Removed: We obtain pharmaceutical and other products from wholesale distributors.
−Removed: We maintained a relationship with a primary supplier, McKesson, that accounted for approximately 98% of pharmaceutical purchases for the year ended December 31, 2024, and several supplementary suppliers.
−Removed: If that supplier was to cease supplying us with products for any reason, we would be forced to find alternative sources for our products.
−Removed: Despite this, we believe we would be able to readily find multiple alternative sources for our products.
−Removed: We may not be able to quickly or effectively replace that supplier, which may lead to delays in product availability and losses of sales, which would have a negative effect on our business, results of operations and financial condition.
−Removed: We derive a significant portion of our revenues from a small number of customers and a loss of one or both of those customers would have a material adverse impact on our business.
−Removed: We sell to numerous customers including various managed care organizations within both the private and public sectors.
−Removed: Certain healthcare payors, including Medicare Part D and the State of Florida, account for more than ten percent or more of our consolidated net revenue in fiscal 2024 and fiscal 2023.
−Removed: Medicare Part D and the State of Florida Medicaid public assistance program are major customers of ours.
−Removed: However, both government programs function under several different healthcare payors, the concentration of which varies throughout the course of the year.
−Removed: To the extent we lost the business of one or more of these healthcare payors, our revenues would significantly decrease, having a material adverse effect on our business, results of operations and financial condition.
−Removed: Our ability to grow our business may be constrained by our inability to find suitable new pharmacy locations at acceptable prices.
−Removed: Our ability to grow our business may be constrained if suitable new pharmacy locations cannot be identified with lease terms or purchase prices that are acceptable to us.
−Removed: We compete with other retailers and businesses for suitable pharmacy locations.
−Removed: Local land use and other regulations may impact our ability to find suitable locations and influence the cost of construction.
−Removed: The expiration of leases at existing locations may adversely affect us if the renewal terms of those leases are unacceptable to us and we are forced to close or relocate.
−Removed: Furthermore, changing local demographics at existing locations may adversely affect revenue and profitability levels at those locations.
−Removed: Our ability to grow our business may be constrained by our inability to obtain adequate permits and licensing for new locations, business lines, and market territories.
−Removed: Our ability to grow our business may be constrained if new locations, business lines, and market territories are not permitted and licensed to conduct ordinary operations.
−Removed: Expansion initiatives can be delayed or even canceled due to a failure to acquire certain government agency approvals.
−Removed: Such delay or cancellation will have a negative impact on our business and results of operations.
−Removed: Product liability, product recall or personal injury issues could damage our reputation and have a significant adverse effect on our businesses, operating results, cash flows and/or financial condition.
−Removed: Should a product liability issue, recall or personal injury issue arise, inadequate product or other liability insurance coverage or our inability to maintain such insurance may result in a material adverse effect on our business and financial condition.
−Removed: Products that we sell could become subject to contamination, product tampering, mislabeling, recall or other damage.
−Removed: In addition, errors in the dispensing and packaging of pharmaceuticals could lead to serious injury.
−Removed: Product liability or personal injury claims may be asserted against us with respect to any of the products or pharmaceuticals we sell or services we provide.
−Removed: If we are not able to market our services effectively to clinics, their affiliated healthcare providers and prescription drug providers, we may not be able to grow our patient base as rapidly as we have anticipated.
−Removed: Our success depends, in part, on our ability to develop and maintain relationships with clinics and their affiliated healthcare providers because each is an important patient referral source for our business.
−Removed: In addition, we also must maintain and continue to establish relationships with prescription drug providers so we can continue to fill prescriptions for our dual eligible customers who receive prescription drug coverage under Medicare Part D.
−Removed: If we are unable to market our services effectively to these clinics, healthcare providers and prescription drug providers, or if our existing relationships with clinics and providers are terminated, our ability to grow our patient base will be harmed, which could significantly reduce our net sales and our ability to maintain profitability.
−Removed: Additionally, Medicare Part D regulations that strictly limit our ability to market to our current and new patients may limit our ability to maintain and grow our current patient base.
−Removed: If we fail to manage our growth or implement changes to our reporting systems effectively, our business could be harmed.
−Removed: If we are unable to manage our growth effectively, we could incur losses.
−Removed: How we manage our growth will depend, among other things, on our ability to adapt our operational, financial and management controls, reporting systems and procedures to the demands of a larger business, including the demands of integrating our acquisitions.
−Removed: To manage the growth and increasing complexity of our business, we may make modifications to or replace computer and other reporting systems, including those that report on our financial results and on which we are substantially dependent.
−Removed: We may incur significant financial and resource costs because of any such modifications or replacements, and our business may be subject to transitional difficulties.
−Removed: The difficulties associated with any such implementation, and any failure or delay in the system implementation, could negatively affect our internal control over financial reporting and harm our business and results of operations.
−Removed: In addition, we may not be able to successfully hire, train and manage additional sales, marketing, customer support and pharmacists quickly enough to support our growth.
−Removed: To provide this support, we may need to open additional offices, which will result in additional burdens on our systems and resources and require additional capital expenditures.
−Removed: We may acquire other companies or technologies, which could divert our management ’ s attention, result in additional dilution to our shareholders and otherwise disrupt our operations and harm our operating results.
−Removed: Our success will depend, in part, on our ability to grow our business in response to the demands of the patients and physicians we serve within the health services industry as well as competitive pressures.
−Removed: In some circumstances, we may determine to do so through the acquisition of complementary businesses and technologies rather than through internal development.
−Removed: The identification of suitable acquisition candidates can be difficult, time-consuming and costly, and we may not be able to successfully complete identified acquisitions.
−Removed: The risks we face in connection with acquisitions include:
−Removed: diversion of management time and focus from operating our business to addressing acquisition integration challenges;
−Removed: coordination of technology, research and development and sales and marketing functions;
−Removed: retention of employees from the acquired company;
−Removed: cultural challenges associated with integrating employees from the acquired company into our organization;
−Removed: integration of the acquired company’s accounting, management information, human resources and other administrative systems;
−Removed: the need to implement or improve controls, procedures and policies at a business that prior to the acquisition may have lacked effective controls, procedures and policies;
−Removed: potential write-offs of intangibles or other assets acquired in such transactions that may have an adverse effect our operating results in a given period;
−Removed: liability for activities of the acquired company before the acquisition, including patent and trademark infringement claims, violations of laws, commercial disputes, tax liabilities and other known and unknown liabilities;
−Removed: litigation or other claims in connection with the acquired company, including claims from terminated employees, consumers, former shareholders or other third parties.
−Removed: Our failure to address these risks or other problems encountered in connection with our future acquisitions and investments could cause us to fail to realize the anticipated benefits of these acquisitions or investments, cause us to incur unanticipated liabilities, and harm our business generally.
−Removed: Future acquisitions could also result in dilutive issuances of our equity securities, the incurrence of debt, contingent liabilities, amortization expenses, or the impairment of goodwill, any of which could harm our financial condition.
−Removed: Also, the anticipated benefits of any acquisitions may not materialize to the extent we anticipate or at all.
−Removed: A disruption in our telephone system or our computer system could harm our business.
−Removed: We receive and take most prescription orders electronically, over the telephone and by facsimile.
−Removed: We also rely extensively upon our computer system to confirm payor information, patient eligibility and authorizations;
−Removed: to check on medication interactions and patient medication history;
−Removed: to facilitate filling and labeling prescriptions for delivery and billing;
−Removed: and to help with the collection of payments.
−Removed: Our success depends, in part, upon our ability to promptly fill and deliver complex prescription orders as well as on our ability to provide reimbursement management services for our patients and their healthcare providers.
−Removed: Any continuing disruption in our telephone, facsimile or computer systems could adversely affect our ability to receive and process prescription orders, make deliveries on a timely basis and receive reimbursement from our payors.
−Removed: This could adversely affect our relations with the patients and healthcare providers we serve and potentially result in a partial reduction in orders from, or a complete loss of, these patients.
−Removed: We may fail to retain or recruit necessary personnel, and, even if we are successful, we may be unable to successfully integrate new personnel into our operations.
−Removed: Our success is highly dependent on the performance of our management team and certain employees, and our continuing ability to attract, develop, motivate, and retain highly qualified and skilled employees and consultants.
−Removed: We have also engaged consultants to advise us on various aspects of our business.
−Removed: Qualified individuals are in high demand, and we may incur significant costs to attract and retain them.
−Removed: While employment agreements and incentive agreements are customarily used as a primary method of retaining the services of key employees, these agreements and arrangements cannot assure the continued services of such employees.
−Removed: The loss of the services of any key personnel or an inability to attract other suitably qualified persons when needed, could prevent us from executing on our business plan and strategy, and we may be unable to find adequate replacements on a timely basis, or at all.
−Removed: Moreover, to execute our growth plans, we expect to hire additional executive officers and key employees.
−Removed: Our future performance will depend in part on our ability to successfully integrate those newly hired executive officers into our management team and our ability to develop an effective working relationship among senior management.
−Removed: Risks Related to the Pharmacy Industry
−Removed: There is substantial competition in our industry, and we may not be able to compete successfully.
−Removed: The pharmacy industry is highly competitive and is continuing to become more competitive.
−Removed: All medications, supplies and services that we provide are also available from our competitors.
−Removed: Our current and potential competitors may include:
−Removed: Other pharmacy distributors;
−Removed: Specialty pharmacy divisions of wholesale drug distributors;
−Removed: Not for profit organizations with pharmacies;
−Removed: Hospital-based pharmacies;
−Removed: Local infusion providers;
−Removed: Sterile and non-sterile compounding pharmacies;
−Removed: Other retail pharmacies;
−Removed: Provider dispensaries;
−Removed: Manufacturers that sell their products both to distributors and directly to clinics and physicians’ offices;
−Removed: Hospital-based care centers and other alternate-site healthcare providers;
−Removed: Insurance companies with proprietary pharmacy services;
−Removed: Customers and MSOs of ours who decide to open their own pharmacies;
−Removed: Chain pharmacies;
−Removed: Mail-order pharmacies.
−Removed: Many specialty patients are currently receiving prescription benefits from federally funded programs such as the Ryan White CARE Act.
−Removed: These payors only use non-profit providers to dispense medications to their enrollees.
−Removed: Many of our competitors have substantially greater resources and marketing staffs and more established operations and infrastructure than we have.
−Removed: A significant factor in effective competition will be our ability to maintain and expand our relationships with patients, healthcare providers and government and private payors.
−Removed: If demand for our products and services is reduced, our business and ability to grow would be harmed.
−Removed: A reduction in demand for specialty medications would significantly harm our business, as we would not be able to quickly shift our business to provide medications for other diseases or disorders.
−Removed: Reduced demand for our products and services could be caused by several circumstances, such as:
−Removed: A cure or vaccine for chronic care conditions;
−Removed: The emergence of new diseases resistant to available medications;
−Removed: Shifts to treatment regimens other than those we offer;
−Removed: New methods of delivery of existing medications or of injectable or infusible medications that do not require our specialty pharmacy and disease management services;
−Removed: Recalls of the medications we sell;
−Removed: Adverse reactions caused by the medications we sell;
−Removed: The expiration of or challenge to the drug patents on the medications we sell.
−Removed: Our revenues could be adversely affected if new drugs or combination therapies are developed and prescribed to our patients that have a reimbursement rate less than that of the current drug therapies our patients receive.
−Removed: If our patients switch medications to those with lower reimbursement rates or to combination therapies, which combine multiple drugs into a single medication, our net sales could decline.
−Removed: Combination therapies reduce the number of total prescriptions received by our patients, resulting in reduced average revenues and a decrease in dispensing fees per patient.
−Removed: If our credit terms with vendors become unfavorable or our relationship with them is terminated, our business could be adversely affected.
−Removed: We depend on existing credit terms from vendors to meet our working capital needs between the times we purchased medications from vendors and when we received reimbursement or payment from third-party payors.
−Removed: Our ability to grow has been limited in part by our inability to negotiate favorable credit terms from our suppliers.
−Removed: If our position changes and we are unable to maintain adequate credit terms or sufficient financing from third-party lenders, we may become limited in our ability to continue to increase the volume of medications we need to fill prescriptions.
−Removed: There are only a few wholesale distributors from which we can purchase the high-cost medications we offer.
−Removed: If any of our vendor agreements terminate or are not renewed, we might not be able to enter a new agreement with another wholesale distributor on a timely basis or on terms favorable to us.
−Removed: Our inability to enter a new supply agreement may cause a shortage of the supply of medications we keep in stock, or we may be required to accept pricing and credit terms from a vendor that are less favorable to us than those we currently have.
−Removed: Risks Relating to Our Data Management Services
−Removed: Competition with some customers, or decisions by customers to perform internally some of the same solutions or services that we offer, could harm our business, results of operations or financial condition.
−Removed: Some of our existing customers compete with us, or may do so in the future, and some customers belong to alliances that compete with us, or may do so in the future, either with respect to the solutions or services we provide to them now, or with respect to other lines of business.
−Removed: To the extent that customers elect to perform internally any of the business processes our solutions address, either because they believe they can provide such processes more efficiently internally or otherwise, we may lose such customers, or the volume of our business with such customers may be reduced, which could harm our business, results of operations or financial condition.
−Removed: If our solutions do not interoperate with our customers ’ or their vendors ’ networks and infrastructures, or if customers or their vendors implement new system updates that are incompatible with our solutions, sales of those solutions could be adversely affected.
−Removed: Our solutions must interoperate with our customers’ and their vendors’ existing infrastructures, which often have different specifications, rapidly evolve, utilize multiple protocol standards, and applications from multiple vendors, and contain multiple generations of products that have been added to that infrastructure over time.
−Removed: Some of the technologies supporting our customers and their vendors are changing rapidly and we must continue to adapt to these changes in a timely and effective manner at an acceptable cost.
−Removed: In addition, our customers and their vendors may implement new technologies into their existing networks and systems infrastructures that may not immediately interoperate with our solutions.
−Removed: Our continued success will depend on our ability to adapt to changing technologies, manage and process ever-increasing amounts of data and information and improve the performance, features and reliability of our services in response to changing customer and industry demands.
−Removed: If we encounter complications related to network configurations or settings, we may have to modify our solutions to enable them to interoperate with customers’ and their vendors’ networks and manage customers’ transactions in the manner intended.
−Removed: Our ability to generate revenue could suffer if we do not continue to update and improve existing solutions and develop new ones.
−Removed: We must continually improve the functionality of our existing solutions in a timely manner and introduce new and valuable healthcare IT and service solutions in order to respond to technological and regulatory developments and customer demands and, thereby, retain existing customers and attract new ones.
−Removed: For example, from time to time, government agencies may alter format and data code requirements applicable to electronic transactions.
−Removed: In addition, customers may request that solutions be customized to satisfy particular security protocols, modifications, and other contractual terms in excess of industry norms and standard configurations.
−Removed: We may not be successful in responding to technological and regulatory developments or changing customer needs.
−Removed: In addition, these regulatory or customer-imposed requirements may impact the profitability of particular solutions and customer engagements.
−Removed: The pace of change in the markets served by us is rapid, and there are frequent new product and service introductions by competitors in their offerings.
−Removed: If we do not respond successfully to technological and regulatory changes, as well as evolving industry standards and customer demands, our solutions may become obsolete.
−Removed: Technological changes also may result in the offering of competitive solutions at lower prices than we are charging for our solutions, which could result in us losing sales unless we lower the prices we charge or provide additional efficiencies or capabilities to the customer.
−Removed: If we lower our prices on some of our solutions, we will need to increase margins on other solutions in order to maintain overall profitability.
−Removed: There are increased risks of performance problems and breaches during times when we are making significant changes to our solutions or systems we use to provide our solutions.
−Removed: In addition, changes to our solutions or systems, including cost savings initiatives, may cost more than anticipated, may not provide the benefits expected, may take longer than anticipated to develop and implement or may increase the risk of performance problems.
−Removed: In order to respond to technological changes, such as continuing development in the areas of data analytics as well as regulatory changes and evolving security risks and industry standards, our solutions and the software and systems we use to provide our solutions must be continually updated and enhanced.
−Removed: We cannot be certain that errors will not arise in connection with any such changes, updates, enhancements or new versions, especially when first introduced.
−Removed: Even if our new, updated or enhanced solutions do not have performance problems, technical and customer service personnel may have difficulties installing them or providing any necessary training and support to customers, and customers may not follow our guidance on appropriate training, support and implementation for such new, updated or enhanced solutions.
−Removed: In addition, changes in technology and systems may not provide the additional functionality or other benefits that were expected.
−Removed: Implementation of changes in our technology and systems may cost more or take longer than originally expected and may require more testing than initially anticipated.
−Removed: While new, updated or enhanced solutions will be tested before they are used in production, we cannot be sure that the testing will uncover all problems that may occur in actual use.
−Removed: If significant problems occur as a result of these changes, we may fail to meet our contractual obligations to customers, which could result in claims being made against us or in the loss of customer relationships.
−Removed: Breaches and failures of our IT systems and the security measures protecting them, and the sensitive information we transmit, use and store, expose us to potential liability and reputational harm.
−Removed: Our business relies on sophisticated information systems to obtain, rapidly process, analyze, and manage data, affecting our ability to provide services.
−Removed: To the extent our IT systems are not successfully implemented or fail, our business and results of operations may be adversely affected.
−Removed: Our business and results of operations may also be adversely affected if a vendor servicing our IT systems does not perform satisfactorily, or if the IT systems are interrupted or damaged by unforeseen events, including the actions of third parties.
−Removed: Further, our business relies to a significant degree upon the secure transmission, use and storage of sensitive information, including protected health information and other personally identifiable information, financial information and other confidential information and data within these systems.
−Removed: To protect this information, we seek to implement commercially reasonable security measures and maintain information security policies and procedures informed by requirements under applicable law and recommended practices, in each case, as applicable to the data collected, hosted and processed.
−Removed: Despite our security management efforts with respect to physical and technological infrastructure, employee training, vendor controls and contractual relationships, our infrastructure, data or other operation centers and systems used in connection with our business operations, including the internet and related systems of our vendors are vulnerable to, and from time to time experience, unauthorized access to data and/or breaches of confidential information due to criminal conduct, physical break-ins, hackers, employee or insider malfeasance and/or improper employee or contractor access, computer viruses, programming errors, denial-of-service attacks, ransomware events, phishing schemes, fraud, terrorist attacks, human error or other breaches by insiders or third-parties or similar disruptive problems.
−Removed: It is not possible to prevent all security threats to our systems and data.
−Removed: Techniques used to obtain unauthorized access, disable or degrade service or sabotage systems change frequently and may be difficult to detect for long periods of time.
−Removed: Because our products and services involve the storage, use and transmission of personal information of consumers, we and other industry participants have been and expect to routinely be the target of attempted cyber and other security threats by outside third parties, including technically sophisticated and well-resourced bad actors attempting to access or steal the data we store.
−Removed: Vendor, insider or employee cyber and security threats also occur and are a significant concern for all companies, including us.
−Removed: While we maintain liability insurance coverage including coverage for errors and omissions and cyber-liability, claims may not be covered or could exceed the amount of our applicable insurance coverage, if any, or such coverage may not continue to be available on acceptable terms or in sufficient amounts.
−Removed: We collect, process, store, share, disclose and use personal information and other data, and our actual or perceived failure to protect such information and data could damage our reputation and brand and harm our business and operating results.
−Removed: We collect, process, store, share, disclose and use personal information and other data provided by patients and healthcare providers.
−Removed: We rely on encryption and authentication technology licensed from third parties to effect secure transmission of such information.
−Removed: We may need to expend significant resources to protect against security breaches or to address problems caused by breaches.
−Removed: Any failure or perceived failure to maintain the security of personal and other data that is provided to us by patients and healthcare providers could harm our reputation and brand and expose us to a risk of loss or litigation and possible liability, any of which could harm our business and operating results.
−Removed: In addition, from time to time, it is possible that concerns will be expressed about whether our products, services, or processes compromise the privacy of our users.
−Removed: Concerns about our practices with regard to the collection, use or disclosure of personal information or other privacy related matters, even if unfounded, could harm our business and operating results.
−Removed: There are numerous federal, state and local laws around the world regarding privacy and the collection, processing, storing, sharing, disclosing, using and protecting of personal information and other data, the scope of which are changing, subject to differing interpretations, and which may be costly to comply with and may be inconsistent between countries and jurisdictions or conflict with other rules.
−Removed: We generally comply with industry standards and are subject to the terms of our privacy policies and privacy-related obligations to third parties.
−Removed: We strive to comply with all applicable laws, policies, legal obligations and industry codes of conduct relating to privacy and data protection, to the extent possible.
−Removed: However, it is possible that these obligations may be interpreted and applied in new ways or in a manner that is inconsistent from one jurisdiction to another and may conflict with other rules or our practices or that new regulations could be enacted.
−Removed: Any failure or perceived failure by us to comply with our privacy policies, our privacy-related obligations to consumers or other third parties, or our privacy-related legal obligations, or any compromise of security that results in the unauthorized release or transfer of sensitive information, which may include personally identifiable information or other user data, may result in governmental enforcement actions, litigation or public statements against us by consumer advocacy groups or others and could cause consumers to lose trust in us, which could have an adverse effect on our business.
−Removed: Additionally, if vendors, developers or other third parties that we work with violate applicable laws or our policies, such violations may also put consumer or dealer information at risk and could in turn harm our reputation, business and operating results.
−Removed: Federal and state privacy and security regulations may increase our cost of operations and expose us to civil and criminal sanctions, damages, and penalties.
−Removed: In the ordinary course of our business, we process, store and transmit data, which may include sensitive personal information of the residents we serve.
−Removed: We must comply with extensive federal and state requirements regarding the use, transmission and maintenance of protected health information (“PHI”) under the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”), and the Health Information Technology for Economic and Clinical Health Act (“HITECH”), which expanded certain sections of HIPAA, including imposing certain liability on business associates, for example, with respect to impermissible uses and disclosures of PHI and Security Rule obligations, strengthening enforcement activities, and increasing penalties for violations.
−Removed: The requirements of federal and state privacy and security laws such as HIPAA and HITECH are complicated and are subject to interpretation and modification.
−Removed: In addition to HIPAA and HITECH, we must adhere to state privacy laws, including those that provide greater privacy protection for individuals than HIPAA.
−Removed: Failure to comply with HIPAA and HITECH or similar state equivalent laws could subject us to loss of customers, denial of the right to conduct business, civil damages, fines, criminal penalties, class action or other litigation, and other enforcement actions.
−Removed: In addition, there are numerous federal and state laws and regulations addressing patient and consumer privacy concerns, including unauthorized access or theft of personal information.
−Removed: State statutes and regulations vary from state to state and could impose additional penalties.
−Removed: Violations of these, or other applicable federal or state laws or regulations could subject us to significant criminal or civil penalties, including significant monetary penalties, and class action or other litigation.
−Removed: There are costs and administrative burdens associated with ongoing compliance with HIPAA’s Privacy and Security Rules, as well as HITECH and state equivalents, and other applicable federal and state regulations.
−Removed: Failure to comply carries with it the risk of significant penalties, damages, and sanctions.
−Removed: We cannot predict at this time the costs associated with compliance, or the impact of such laws and regulations on our results of operations, cash flows or financial condition.
−Removed: There can be no assurance that the cost of compliance with such laws and regulations will not increase significantly in the future, which could result in an adverse effect on our operations or profitability.
−Removed: If we are unable to successfully execute on cross-selling opportunities of our solutions the growth of our business and financial performance could be harmed.
−Removed: Our ability to generate growth partly depends on our ability to cross-sell solutions to existing customers and new customers.
−Removed: We have identified our ability to successfully cross-sell our solutions as a key part of our business strategy and therefore one of the most significant factors influencing growth.
−Removed: We may not be successful in cross-selling our solutions because customers may find additional solutions unnecessary, unattractive or cost-ineffective.
−Removed: Failure to sell additional solutions to existing and new customers could negatively affect our ability to grow our business.
−Removed: We rely on internet infrastructure, bandwidth providers, other third parties and our own systems in providing certain of our solutions to our customers, and any failure or interruption in the services provided by these third parties or our own systems could negatively impact our relationships with customers, adversely affecting our brand and our business.
−Removed: Our ability to deliver our solutions is dependent on the development and maintenance of the infrastructure of the internet and other telecommunications services by third parties.
−Removed: This includes maintenance of a reliable network connection with the necessary speed, data capacity and security for providing reliable internet access and services and reliable telephone and facsimile services.
−Removed: As a result, our information systems require an ongoing commitment of significant resources to maintain and enhance existing systems and develop new systems in order to keep pace with continuing changes in information technology, emerging cybersecurity risks and threats, evolving industry and regulatory standards and changing preferences of our customers.
−Removed: Our solutions are designed to operate without interruption in accordance with our service level commitments.
−Removed: However, we have experienced limited interruptions in these systems in the past, including server failures that temporarily slow down the performance of our solutions, and we may experience more significant interruptions in the future.
−Removed: We rely on internal systems as well as vendors, including bandwidth and telecommunications equipment providers, to provide our solutions.
−Removed: We do not maintain redundant systems or facilities for some of these services.
−Removed: Interruptions in these systems, whether due to system failures, computer viruses, physical or electronic break-ins or other catastrophic events, could affect the security or availability of our solutions and prevent or inhibit the ability of our customers to access our solutions.
−Removed: If a catastrophic event were to occur with respect to one or more of these systems or facilities, we may experience an extended period of system unavailability, which could result in substantial costs to remedy those problems or negatively impact our relationship with our partners, our business, results of operations and financial condition.
−Removed: To operate without interruption, both we and our vendors must guard against:
−Removed: damage from fire, power loss, tornado and other natural disasters;
−Removed: telecommunications failures;
−Removed: software and hardware errors, failures and crashes;
−Removed: security breaches, computer viruses and similar disruptive problems;
−Removed: other potential interruptions.
−Removed: Any disruption in the network access, telecommunications or co-location services provided by vendors, or any failure of or by vendors’ systems or our own systems to handle current or higher volume of use could significantly harm our business.
−Removed: We exercise limited control over these vendors, which increases our vulnerability to problems with services they provide.
−Removed: Any errors, failures, interruptions or delays experienced in connection with these vendor technologies and information services or our own systems could negatively impact our relationships with partners and adversely affect our business and could expose us to liabilities.
−Removed: Although we maintain insurance for our business, the coverage under our policies may not be adequate to compensate us for all losses that may occur.
−Removed: In addition, we cannot provide assurance that we will continue to be able to obtain adequate insurance coverage at an acceptable cost.
−Removed: Risks Related to Our Securities
−Removed: You may experience dilution of your ownership interests because of the future issuance of additional shares of our common or preferred stock or other securities that are convertible into or exercisable for our common or preferred stock.
−Removed: We are authorized to issue an aggregate of 50,000,000 shares of common stock and 3,333,333 shares of “blank check” preferred stock.
−Removed: In the future, we may issue our authorized but previously unissued equity securities, resulting in the dilution of the ownership interests of our present stockholders.
−Removed: We may issue additional shares of our common stock or other securities that are convertible into or exercisable for our common stock in connection with hiring or retaining employees, future acquisitions, future sales of our securities for capital raising purposes, or for other business purposes.
−Removed: The future issuance of any such additional shares of our common stock may create downward pressure on the trading price of the common stock.
−Removed: You will experience future dilution because of future equity offerings.
−Removed: We may in the future offer additional shares of our common stock or other securities convertible into or exchangeable for our common stock.
−Removed: Although no assurances can be given that we will consummate a financing, in the event we do, or in the event we sell shares of common stock or other securities convertible into shares of our common stock in the future, additional and substantial dilution will occur.
−Removed: In addition, investors purchasing shares or other securities in the future could have rights superior to our current stockholders.
−Removed: We do not anticipate paying dividends on our common stock, and investors may lose the entire amount of their investment.
−Removed: Cash dividends have never been declared or paid on our common stock, and we do not anticipate such a declaration or payment in the foreseeable future.
−Removed: We expect to use future earnings, if any, to fund business growth.
−Removed: Therefore, stockholders will not receive any funds absent a sale of their shares of common stock.
−Removed: If we do not pay dividends, our common stock may be less valuable because a return on your investment will only occur if our stock price appreciates.
−Removed: We cannot assure stockholders of a positive return on their investment when they sell their shares, nor can we assure that stockholders will not lose the entire amount of their investment.
−Removed: The ability of our Board of Directors to issue additional stock may prevent or make certain transactions more difficult, including a sale or merger of the Company.
−Removed: Our Board of Directors is authorized to issue up to 3,333,333 shares of preferred stock with powers, rights and preferences designated by it.
−Removed: Shares of voting or convertible preferred stock could be issued, or rights to purchase such shares could be issued, to create voting impediments or to frustrate persons seeking to affect a takeover or otherwise gain control of the Company.
−Removed: The ability of the Board of Directors to issue such additional shares of preferred stock, with rights and preferences it deems advisable, could discourage an attempt by a party to acquire control of the Company by tender offer or other means.
−Removed: Such issuances could therefore deprive stockholders of benefits that could result from such an attempt, such as the realization of a premium over the market price for their shares in a tender offer or the temporary increase in market price that such an attempt could cause.
−Removed: Moreover, the issuance of such additional shares of preferred stock to persons friendly to the Board of Directors could make it more difficult to remove incumbent officers and directors from office even if such change were to be favorable to stockholders generally.
−Removed: Our common stock and warrants are thinly traded and there can be no assurance that a more active public market will ever develop.
−Removed: Failure to develop or maintain an active trading market could negatively affect the value of our common stock and make it difficult or impossible for you to sell your shares.
−Removed: Our common stock and Warrants are listed on Nasdaq but there can be no assurance that an active trading market will develop for our shares and Warrants.
−Removed: Should we fail to satisfy the Nasdaq continued listing standards, the trading price of our common stock could suffer and the trading market for our common stock and warrants may be less liquid, and our common stock price and warrant price may be subject to increased volatility, making it difficult or impossible to sell shares of our common stock and warrants.
−Removed: The provisions of our Nasdaq listed Warrants could discourage the acquisition of us by a third party .
−Removed: Certain provisions of our Nasdaq listed Warrants could make it more difficult or expensive for a third party to acquire us.
−Removed: The Nasdaq listed Warrants prohibit us from engaging in certain transactions constituting “fundamental transactions” unless, among other things, the surviving entity assumes our obligations under the warrants.
−Removed: These and other provisions of the Nasdaq listed Warrants could prevent or deter a third party from acquiring us even where the acquisition could be beneficial to you.
−Removed: There can be no assurance that we will be able to comply with the continued listing standards of Nasdaq, a failure of which could result in a de-listing of our common stock .
−Removed: The Nasdaq Capital Market requires that the trading price of its listed stocks remain above one dollar in order for the stock to remain listed.
−Removed: If a listed stock trades below one dollar for more than 30 consecutive trading days, then it is subject to delisting from Nasdaq.
−Removed: In addition, to maintain a listing on Nasdaq, we must satisfy minimum financial and other continued listing requirements and standards, including those regarding director independence and independent committee requirements, minimum stockholders’ equity, and certain corporate governance requirements.
−Removed: If we are unable to satisfy these requirements or standards, we could be subject to delisting, which would have a negative effect on the price of our common stock and would impair your ability to sell or purchase our common stock when you wish to do so.
−Removed: In the event of a delisting, we would expect to take actions to restore our compliance with the listing requirements, but we can provide no assurance that any such action taken by us would allow our common stock to become listed again, stabilize the market price or improve the liquidity of our common stock, prevent our common stock from dropping below the minimum bid price requirement, or prevent future non-compliance with the listing requirements.
−Removed: Our stock price may be volatile.
−Removed: The market price of our common stock is likely to be highly volatile and could fluctuate widely in price in response to various factors, many of which are beyond our control, including the following:
−Removed: changes in our industry;
−Removed: competitive pricing pressures;
−Removed: our ability to obtain working capital financing;
−Removed: additions or departures of key personnel;
−Removed: conversions from preferred stock to common stock;
−Removed: sales of our common and preferred stock;
−Removed: our ability to execute our business plan;
−Removed: operating results that fall below expectations;
−Removed: loss of any strategic relationship;
−Removed: regulatory developments;
−Removed: economic and other external factors.
−Removed: In addition, the securities markets have from time-to-time experienced significant price and volume fluctuations that are unrelated to the operating performance of companies.
−Removed: These market fluctuations may also materially and adversely affect the market price of our common stock.
−Removed: 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.
−Removed: If our stockholders sell substantial amounts of our common stock in the public market, including upon the expiration of any statutory holding period under Rule 144, or issued upon the conversion of preferred stock or exercise of 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.
−Removed: The existence of an overhang, whether 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.
+Added: We depend significantly on Amazon marketplaces and fulfillment services, and adverse changes to our relationship with Amazon could materially harm our business.
+Added: Amazon marketplaces represented approximately 31% and 33% of our total e-Commerce revenue for the years ended December 31, 2025 and 2024, respectively.
+Added: We expect Amazon to remain a significant distribution channel.
+Added: Amazon may suspend or terminate seller accounts, modify fee structures, alter search algorithms, impose additional compliance requirements, or withhold payments at its discretion.
+Added: Any limitation, suspension, increased fees, or adverse algorithm changes could significantly reduce our revenues, profitability, and cash flows.
+Added: We also rely on Amazon’s fulfillment services to provide expedited shipping.
+Added: Any disruption in these services or failure to meet Amazon’s performance metrics could negatively impact our marketplace visibility and customer satisfaction.
+Added: Amazon may withhold or delay payments to sellers in connection with performance investigations, chargebacks, customer claims or alleged policy violations.
+Added: Because a significant portion of our revenue is generated through Amazon marketplaces, any extended payment hold or account suspension could materially impact our short-term liquidity.
+Added: In addition, Amazon competes directly with third-party sellers by offering its own private label products and may use data derived from marketplace activity to inform competitive offerings.
+Added: Our e-Commerce operations depend on global suppliers, manufacturers and logistics providers.
+Added: We rely on third-party manufacturers and suppliers for satellite phones, tracking devices, broadband terminals and other products.
+Added: Certain products or components are sourced from limited suppliers.
+Added: Disruptions due to production delays, financial distress, geopolitical events, tariffs, port congestion, customs delays or transportation interruptions could lead to inventory shortages and increased costs.
+Added: If we cannot obtain sufficient inventory at commercially reasonable prices or pass increased costs through to customers, our margins, results of operations, and cash flows could be materially adversely affected.
+Added: We operate in highly competitive markets and technological advances may render our products less competitive.
+Added: We face intense competition from established e-Commerce platforms, satellite communications providers, and emerging technologies such as Low Earth Orbit (“LEO”) satellite systems that may reduce demand for certain of our products.
+Added: Failure to innovate, adapt to new technologies, or effectively compete on price, service, or product offerings could materially adversely affect our business.
+Added: Risks Related to Healthcare and Regulation
+Added: Changes in reimbursement rates, healthcare regulations, or pharmacy benefit manager practices could materially adversely affect our healthcare segment.
+Added: Our healthcare operations are subject to complex federal and state regulations, including reimbursement from Medicare, Medicaid and PBMs.
+Added: Changes in reimbursement methodologies, pricing pressure, generic drug deflation, clawbacks, DIR fees, or modifications to the 340B program could reduce margins.
+Added: In addition, failure to comply with healthcare laws and regulations could result in fines, penalties, exclusion from government programs, or suspension of operations.
+Added: We are subject to extensive and evolving domestic and international laws and regulations.
+Added: Our operations are subject to numerous laws relating to commerce, consumer protection, product safety, intellectual property, privacy, anti-corruption, trade compliance, export controls and taxation.
+Added: Failure to comply could result in fines, penalties, litigation, reputational harm and operational disruption.
+Added: Our healthcare operations are subject to audits, investigations and potential recoupment actions by government agencies and pharmacy benefit managers.
+Added: Our pharmacy operations are subject to audits and reviews by Medicare, Medicaid, PBMs, third-party payors, state boards of pharmacy, the DEA, and other federal and state agencies.
+Added: These audits may result in payment recoupments, penalties, fines, exclusion from reimbursement programs, or other corrective actions.
+Added: PBMs may conduct routine or targeted audits and may assert overpayment claims, impose clawbacks, reduce reimbursement rates, or terminate network participation agreements.
+Added: Government investigations or enforcement actions could result in civil or criminal penalties, suspension of operations, or reputational harm.
+Added: Any significant audit finding, reimbursement recoupment, network termination or regulatory action could materially adversely affect our healthcare segment and overall results of operations and cash flows.
+Added: Failure to comply with laws and regulations governing controlled substances could materially adversely affect our operations.
+Added: To the extent we dispense controlled substances, we are subject to federal and state laws administered by the DEA and other regulatory authorities.
+Added: These laws impose strict recordkeeping, reporting, security and dispensing requirements.
+Added: Violations, whether intentional or inadvertent, could result in civil penalties, loss of controlled substance registrations, fines, or criminal liability.
+Added: The loss or suspension of any required license or registration could materially impair our ability to operate our pharmacy business.
+Added: A significant portion of our pharmacy segment gross profit is derived from participation in the federal 340B Drug Pricing Program, and adverse changes to the program could materially adversely affect our profitability and cash flows .
+Added: A material portion of our pharmacy segment gross profit is derived from participation in the federal 340B Drug Pricing Program, including revenues generated through contract pharmacy arrangements.
+Added: Prescriptions dispensed under the 340B program generally carry significantly higher margins than non-340B prescriptions.
+Added: As a result, although 340B prescriptions may represent a smaller percentage of total prescription volume, they contribute a disproportionately significant portion of our pharmacy segment gross profit.
+Added: The 340B program has been subject to increased regulatory scrutiny, manufacturer restrictions on contract pharmacy arrangements, litigation, legislative proposals, and evolving guidance from the Health Resources and Services Administration (“HRSA”).
+Added: Pharmaceutical manufacturers have imposed limitations on the distribution of 340B-priced drugs through contract pharmacies, and additional restrictions may be implemented in the future.
+Added: Federal or state regulatory changes, judicial decisions, or manufacturer policies that reduce 340B eligibility, limit contract pharmacy arrangements, alter reimbursement methodologies, or otherwise decrease the margin associated with 340B prescriptions could materially reduce our pharmacy segment profitability.
+Added: In addition, noncompliance with 340B program requirements, whether intentional or inadvertent, could result in repayment obligations, civil monetary penalties, exclusion from the program, termination of covered entity relationships, or reputational harm.
+Added: Any material reduction in our ability to generate gross profit from 340B prescriptions could materially adversely affect our business, financial condition, results of operations, and cash flows.
+Added: Risks Related to Data Security and Technology
+Added: Security breaches or failures in our information systems could materially harm our business.
+Added: We process and store sensitive customer, supplier and business information.
+Added: Cyberattacks, data breaches, ransomware incidents, employee misconduct or system failures could result in data loss, regulatory penalties, litigation and reputational harm.
+Added: Despite security measures, no system is immune from attack.
+Added: A significant cybersecurity incident could materially adversely affect our operations and financial condition.
+Added: We may incur significant costs and liabilities in connection with data privacy and cybersecurity regulations.
+Added: We are subject to evolving data protection and privacy laws and regulations, including federal and state privacy laws, data breach notification requirements and healthcare privacy regulations such as HIPAA, to the extent applicable.
+Added: A data breach or failure to comply with applicable privacy laws could result in regulatory investigations, fines, penalties, litigation, mandatory notification costs, credit monitoring expenses, and reputational harm.
+Added: Compliance with evolving cybersecurity and privacy regulations may require substantial investment in administrative, technical and physical safeguards.
+Added: Any failure to comply with these requirements could materially adversely affect our business and financial condition.
+Added: Risks Related to Acquisitions and Growth
+Added: Our growth strategy involves acquisitions and strategic investments that may not achieve expected benefits.
+Added: We may pursue acquisitions, investments and joint ventures.
+Added: These transactions involve integration risks, potential hidden liabilities, management distraction, regulatory approvals and financial exposure.
+Added: Failure to successfully integrate acquired businesses could materially adversely affect our results of operations and cash flows.
+Added: Risks Related to International Operations and China
+Added: Our operations in China expose us to political, economic and regulatory risks.
+Added: We market products in China and may expand operations there.
+Added: The regulatory environment in the PRC is evolving and subject to significant government discretion.
+Added: Changes in trade policy, tariffs, foreign exchange controls, licensing requirements, data security laws or geopolitical tensions between the United States and China could increase costs, restrict operations or reduce demand for our products.
+Added: Retaliatory tariffs imposed by China in response to tariffs enacted by the United States expose us to significant trade-policy risk.
+Added: Elevated tariff rates and other non-tariff barriers imposed on U.S.-origin goods may adversely affect the competitiveness of certain of our products in the Chinese market.
+Added: Chinese authorities possess broad discretion to modify tariff rates or impose additional trade restrictions with limited advance notice and may target specific U.S.
+Added: industries or product categories in response to geopolitical developments.
+Added: In response to the current tariff environment, we have paused certain initiatives within our e-Commerce development program that were intended to expand U.S.-origin product sales into China, including the introduction of certain products under our Florida Sunshine brand.
+Added: For the year ended December 31, 2025, our revenue in China represented less than 1% of our consolidated revenues and did not have a material impact on our results of operations.
+Added: If elevated tariffs persist, expand, or are reinstated following any temporary easing, our ability to profitably sell certain U.S.-origin products in China could be materially adversely affected.
+Added: While we continue to sell certain non-U.S.-origin products in China that are not currently subject to additional tariffs, future changes in trade policy could alter the tariff treatment of those products as well.
+Added: We cannot predict whether the current trade environment will persist or whether new quotas, duties, tariffs, exchange controls, sanctions, or other restrictions will be imposed by either government.
+Added: Any such actions could materially adversely affect our business, financial condition, results of operations and cash flows.
+Added: Risks Related to Corporate Governance and Public Company Status
+Added: Being a public company increases our costs and administrative burdens.
+Added: We incur substantial legal, accounting and compliance costs as a public company, including Sarbanes-Oxley compliance.
+Added: Failure to maintain effective internal controls could impair investor confidence and adversely affect our stock price.
+Added: Concentration of ownership may limit other stockholders ’ ability to influence corporate matters.
+Added: Our principal stockholders, executive officers and directors collectively own a significant percentage of our outstanding shares, which may allow them to influence corporate actions, including election of directors and approval of major transactions.
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.