Lite Strategy (LITS) risk factors, FY2024 10-K

Risks Related to Our Review of Strategic Alternatives

1. 01We may not be successful in identifying and implementing any potential strategic alternatives in a timely manner, or at all, and any strategic transactions that we may consummate in the future could have negative consequences
2. 02identify, negotiate and consummate such transaction. If we are unable to successfully retain certain of our key remaining personnel, we are at risk of a disruption to our exploration and consummation of one or more strategic transactions
3. 03about a reasonable amount to reserve. Accordingly, holders of our common stock could lose all or a significant portion of their investment in the event of a liquidation, dissolution or winding up
4. 04We may become involved in litigation, including securities class action litigation, that could divert our management’s attention and harm our business, and insurance coverage may not be sufficient to cover all costs and damages
5. 05Our workforce reduction may not achieve our intended outcome and may result in significant adverse consequences

Risks Related to Our Financial Condition and Capital Requirements

1. 06We have incurred significant losses from our inception, and we anticipate that we may incur losses in the foreseeable future
2. 07Should we resume development activities in the future, we expect that research and development costs would increase significantly and we would continue to incur significant expenses and operating and net losses, as we develop and seek regulatory approval for such drug candidates
3. 08enter into, and our expenditures on other research and development (R&D) activities as well as any payments owed under the License Agreement with Presage and any future similar agreements
4. 09add operational, financial and management information systems and personnel, including personnel to support our drug development and potential future commercialization efforts
5. 10If we decide to resume development of our drug candidate or any future drug candidate, we will need additional funding and may be unable to raise capital when needed, which would force us to delay, reduce or eliminate our drug development programs
6. 11In July 2024, we discontinued the clinical program in our pipeline in connection with our undertaking a comprehensive exploration of strategic alternatives focused on maximizing stockholder value. In connection with our streamlined operating plan, we commenced a reduction-in-force
7. 12the terms and timing of any collaborative, licensing, co-promotion or other arrangements that we may establish

Risks Related to Any Future Development and Commercialization of Our Drug and Potential Drug Candidates

1. 13Should we resume development of our drug candidate or future drug candidates, if we are unable to successfully complete clinical development, obtain regulatory approvals and commercialize our drug candidate or future drug candidates, or experience significant delays in doing so, our business will be materially harmed

Risks Related to Our Intellectual Property

1. 14The value of our intellectual property is dependent, in part, on obtaining and maintaining patent protection and preserving trade secrets, which cannot be guaranteed
2. 15respect to the use of their isoflavone compounds, including ME-344. Finally, in September 2013, we acquired patents and patent applications related to zandelisib from Pathway Therapeutics, Inc

General Business Risks

1. 16Our employees, independent contractors, consultants, commercial partners, principal investigators, or CROs may engage in misconduct or other improper activities, including noncompliance with regulatory standards and requirements, which could have a material adverse effect on our business
2. 17Our business and operations would suffer in the event of system failures
3. 18Our efforts will be seriously jeopardized if we are unable to retain and attract key employees
4. 19Negative U.S. and global economic conditions may pose challenges to our business strategy, which relies on funding from the financial markets or collaborators
5. 20Laws, rules and regulations relating to public companies may be costly and impact our ability to attract and retain directors and executive officers
6. 21Security breaches and privacy issues could compromise our information and expose us to liability, which would cause our business and reputation to suffer
7. 22prospective European clinical trial sites and CROs to use our products, and we may find it necessary or desirable to make further changes to our processing of personal data of EEA or U.K. data subjects
8. 23If we fail to comply with environmental, health and safety laws and regulations, we could become subject to fines or penalties or incur costs that could harm our business
9. 24We or the third parties upon whom we depend may be adversely affected by natural disasters and our business continuity and disaster recovery plans may not adequately protect us from a serious disaster
10. 25Limitations on the deductibility of net operating losses could adversely affect our business and financial condition

Risks Related to Securities Markets and Investment in our Stock

1. 26We are currently operating in a period of capital markets disruption and economic uncertainty
2. 27If we fail to comply with the continued listing standards of the Nasdaq Capital Market, we may be delisted and the price of our common stock, our ability to access the capital markets and our financial condition could be negatively impacted
3. 28Anson Advisors Inc. holds approximately 16.4% of our outstanding common stock and Cable Car Capital LLC holds approximately 9.2% of our outstanding common stock, and each have sought to exert influence on our business operations and Board, and we expect that each will or may continue to do so
4. 29The trading price of the shares of our common stock has been and may continue to be highly volatile and could decline in value and we may incur significant costs from class action litigation
5. 30threatened or actual delisting of our common stock from a national stock exchange
6. 31Future sales of our common stock, including common stock issued upon exercise of outstanding warrants or options, may depress the market price of our common stock and cause stockholders to experience dilution
7. 32Other than as described below or in connection with a strategic transaction we do not intend to pay, and we have not paid, any cash dividends on our shares of common stock. Our stockholders will not be able to receive a return on their shares unless the value of our common stock appreciates and they sell their shares
8. 33We will have broad discretion over the use of the net proceeds from any exercise of outstanding warrants and options
9. 34We are authorized to issue blank check preferred stock, which could adversely affect the holders of our common stock
10. 35Anti-takeover provisions contained in our amended and restated certificate of incorporation and sixth amended and restated bylaws, as well as provisions of Delaware law, could impair a takeover attempt
11. 36Any person or entity purchasing or otherwise acquiring or holding any interest in our shares of capital stock shall be deemed to have notice of and consented to such provisions
12. 37Our executive officers and directors may sell shares of their stock, and these sales could adversely affect our stock price