CISO Global (CISO) risk factors, FY2025 10-K

Risks Related to Our Business and Industry

1. 01We will need to raise capital to realize our business plan and growth strategy, the failure of which could adversely impact our operations70% rewritten
2. 02We will need to improve the size and capabilities of our organization, and we may experience difficulties in managing this growth
3. 03We depend on key personnel who would be difficult to replace, and our business plans will likely be harmed if we lose their services or cannot hire additional qualified personnel
4. 04We operate in an industry that is experiencing a shortage of qualified compliance and cybersecurity professionals. If we are unable to recruit and retain key management and technical and sales personnel, our business would be negatively affected
5. 05We depend on independent contractors to provide certain services for which we do not have the expertise internally. Any compromise in the service quality may delay our business processes and cause economic loss
6. 06We have acquired multiple businesses. Our growth strategy is driven by successful acquisitions and integration of additional businesses that provide comparable or complementary services
7. 07Our business strategy may impose limitations on our ability to accurately forecast future revenue and operating results
8. 08Our sales cycles can be long and unpredictable, and our sales efforts require considerable time and expense
9. 09Our dependence on a significant customer for a material portion of our revenue and accounts receivable exposes us to risks that could have a material adverse effect on our business, financial condition, and results of operationsNew
10. 10Because we recognize revenue from subscriptions to our solutions over the term of the subscription, downturns or upturns in new business will not be immediately reflected in our operating results
11. 11We provide service level commitments under some of our customer contracts. If we fail to meet these contractual commitments, we could be obligated to provide partial refunds, or our customers could be entitled to terminate their contracts and our business would suffer
12. 12Our business is subject to the risks of warranty claims from real or perceived defects in our solutions or their misused by our customers or third parties and provisions in certain agreements potentially expose us to substantial liability and other losses
13. 13We continue to monitor and manage these risks, but there can be no assurance that our efforts will prevent material adverse impacts on our business
14. 14Our future results may be affected by various legal and regulatory proceedings and legal compliance risks, including those involving intellectual property, governmental regulations, the U.S. Foreign Corrupt Practices Act, and other anti-bribery, anti-corruption, or other matters
15. 15We may be subject to risks from operating internationally
16. 16Our operations in certain emerging markets expose us to political, economic, and regulatory risks
17. 17Adverse economic conditions in the United States may adversely impact our business and operating results
18. 18We may not be successful in our artificial intelligence initiatives, which could adversely affect our business, reputation, or financial resultsNew
19. 19The use of AI technology in our IT infrastructure could improve internal process but poses security and privacy risksNew
20. 20Breaches of network or information technology security could have an adverse effect on our business
21. 21If we fail to meet our service level obligations under our service level agreements, we may be subject to certain penalties and could lose clients
22. 22The nature of our business involves significant risks and uncertainties that may not be covered by insurance or indemnification
23. 23We indemnify our officers and directors against liability to us and our security holders, and such indemnification could increase our operating costs
24. 24Our industry is highly competitive, and there is no assurance that we will compete successfully
25. 25Our success depends on our ability to protect our intellectual property and our proprietary technologies
26. 26Increasingly complex cybersecurity regulations and standards may have significant impact on our business, and it may require us to substantially invest in our development capabilities to meet compliance requirements and may negatively impact our ability to offer certain services and remain profitable
27. 27We may become subject to disputes, including litigation, that could negatively impact our business, profitability, and financial condition
28. 28If we incur additional debt, we will be subject to restrictive covenants and debt service obligations that could negatively impact our operations
29. 29The preparation of our financial statements involves the use of estimates, judgments, and assumptions, and our financial statements may be materially affected if our estimates prove to be inaccurate
30. 30The auditor’s opinion on our audited consolidated financial statements for the year ended December 31, 2025, included in this annual report on Form 10-K, contain an explanatory paragraph relating to our ability to continue as a going concern

Risks Related to our Common Stock

1. 31The market price of our common stock is volatile and may fluctuate in a way that is disproportionate to our operating performance
2. 32Future sales of shares of our common stock by existing stockholders could depress the market price of our common stock23% rewritten
3. 33Provisions in our certificate of incorporation, our by-laws, and Delaware law might discourage, delay, or prevent a change in control of our company or changes in our management and, therefore, depress the trading price of our common stock
4. 34Our Board of Directors is expressly authorized to make, alter, or repeal our by-laws by majority vote, while such action by stockholders would require a super majority vote
5. 35Our ability to access the full amount available under the purchase agreement with B. Riley is not guaranteed, and our broad discretion over the use of any proceeds we receive may not result in improved financial performance or stockholder valueNew
6. 36The issuance and potential conversion of Series B Preferred Stock may adversely affect our common stockholders and the market price of our common stock, and our obligation to redeem shares of Series B Preferred Stock upon certain triggering events could materially harm our liquidity and financial conditionNew
7. 37FINRA sales practice requirements may limit a stockholder’s ability to buy and sell our stock
8. 38If we issue additional shares in the future, it will result in a dilution of our existing stockholders41% rewritten
9. 39We are eligible to be treated as an “emerging growth company,” as defined in the JOBS Act, and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies will make our common stock less attractive to investors
10. 40Our directors, a former director, a consultant and an executive officer beneficially own a substantial majority of our outstanding capital stock and will have the ability to control our affairs34% rewritten
11. 41Our failure to meet the continued listing requirements of Nasdaq could result in a delisting of our common stock83% rewritten
12. 42We do not intend to pay dividends on our common stock
13. 43Our business could be negatively impacted by stockholder activism
14. 44Our share price may be volatile, and you may be unable to sell your shares