Onfolio Holdings (ONFO) risk factors, FY2025 10-K

Risks Related to Our Business – General

1. 01We may not be able to continue to successfully manage our online businesses on a combined basis
2. 02Many of our online businesses have a limited operating history upon which investors can evaluate their future prospects
3. 03We have incurred operating losses since our inception and we may continue to incur substantial operating losses for the foreseeable future33% rewritten
4. 04Our independent registered public accounting firm has expressed substantial doubt about our ability to continue as a going concern
5. 05We require additional capital to support our present business plans and our anticipated business growth, and such capital may not be available on acceptable terms, or at all, which would adversely affect our ability to operate
6. 06We cannot predict our future capital needs and we may not be able to secure additional financing87% rewritten
7. 07Our indebtedness and liabilities could limit the cash flow available for our operations, expose us to risks that could adversely affect our business, financial condition and results of operations and impair our ability to satisfy our obligations under the Senior Secured Notes when they come dueNew
8. 08placing us at a possible competitive disadvantage with competitors that are less leveraged than us or have better access to capitalNew
9. 09We may not have the ability to raise the funds necessary to settle conversions of the Senior Secured Notes in cash or to repurchase the notes upon an event of default or a fundamental changeNew
10. 10We are currently in default pursuant to the Senior Secured Notes and Registration Rights AgreementNew
11. 11Certain provisions in the Securities Purchase Agreement and the Senior Secured Notes may delay or prevent an otherwise beneficial takeover attempt of usNew
12. 12If we fail to retain certain of our key personnel and attract and retain additional qualified personnel, we might not be able to pursue our growth strategy
13. 13The need to sustain our current operating structure may place a significant strain on our management and our administrative, operational and financial reporting infrastructure
14. 14Negative publicity could adversely affect our reputation, our business, and our operating results
15. 15Natural disasters and other events beyond our control could materially adversely affect us
16. 16Political and economic factors may negatively affect our financial condition or results of operations

Risks Related to Our Business – Primary Risk Factors Related to Our Specific Online Businesses

1. 17Economic Downturn Impact . In the event of an economic slowdown or recession, businesses may reduce marketing and branding budgets to cut costs, which could lead to Eastern Standard facing lower client demand, impacting revenue41% rewritten
2. 18ProofreadAnywhere.com/WorkAtHomeSchool.com/WorkYourWay2020.com
3. 19Freebie Offerings . If companies no longer utilize freebies or giveaways as part of their marketing strategy, Wowfreestuff.co.uk will have fewer products to promote on its website, which in turn could negatively impact the website’s commission revenue generation23% rewritten
4. 20Craftwhack.com – Managed Property
5. 21Backgroundhawk.com – Managed Property
6. 22Outreachmama.com – Managed Property
7. 23Getmerankings.com – Managed Property

Risks Related to Our Business – Operating Our Online Businesses

1. 24If we are unable to attract new customers and retain customers on a cost-effective basis, our business and results of operations will be affected adversely
2. 25If we fail to develop our brands cost-effectively, our business may be adversely affected
3. 26The market in which our online businesses participate is competitive and, if we do not compete effectively, our operating results could be harmed

Risks Related to Our Business – Our Acquisition Plans

1. 27difficulties and additional expenses associated with supporting legacy products and hosting infrastructure of the acquired business;
2. 28use of substantial portions of our available cash to consummate the acquisition
3. 29Pursuant to our long-term investment strategy, we may pursue future acquisitions or business relationships, or make business dispositions that may not be in the best interest of common stockholders in near term or at all
4. 30Because of our limited resources and the significant competition for acquisition opportunities, it may be more difficult for us to acquire target online businesses that meet our acquisition criteria
5. 31Subsequent to the acquisition of any target business, we may be required to take write-downs or write-offs, restructuring and impairment or other charges that could have a significant negative effect on our financial condition, results of operations and the price of our securities34% rewritten
6. 32We may seek target online businesses in industries or sectors that may be outside of our management’s areas of expertise
7. 33We will likely not obtain an opinion from an independent accounting or investment banking firm in connection with the acquisition of a target business
8. 34Our resources could be wasted by acquisition transactions that are not completed
9. 35The officers and directors of a target business may resign upon completion of our acquisition. The loss of a target business’ key personnel could negatively impact the operations and profitability of the target business post-acquisition
10. 36We may attempt to simultaneously acquire multiple target online businesses, which may give rise to increased costs and risks that could negatively impact our operations and profitability
11. 37We intend to pursue and acquire target businesses located outside of the United States so we will be subject to a variety of additional risks that may adversely affect us
12. 38deterioration of political relations with the United States

Risks Related to our Digital Assets Treasury Strategy

1. 39Our investments in digital assets subject us to significant volatility and potential lossesNew
2. 40We face risks relating to the custody and security of our digital assets , including the potential loss or compromise of private keys and cyberattacksNew
3. 41Our increased digital assets holdings have required substantial changes in our day-to-day operations and have exposed and continue to expose us to significant operational risksNew
4. 42Our c ommon s tock may trade at a substantial premium or discount to the value of the digital assets we hold, and our stock price may be more volatile than the price of digital assets New
5. 43Digital assets have a limited operating history and are highly volatile, and volatility in the price of our digital assets could materially adversely affect our financial results and the market price of our common stockNew
6. 44Security breaches or cyberattacks could result in loss of our digital assets New
7. 45improper disclosure of data and violations of applicable data privacy and other laws; or significant regulatory scrutiny, investigations, fines, penalties, and other legal, regulatory, contractual and financial exposureNew
8. 46A “fork” in the network protocols could adversely affect the value of our digital assets holdings New

Risks Related to Information Technology Systems, Intellectual Property and Privacy Laws

1. 47We are reliant upon information technology to operate our business and maintain our competitiveness
2. 48Any significant disruption in service on our website or in our computer systems, or in our customer support services, could reduce the attractiveness of our services and result in a loss of customers
3. 49We do not have a disaster recovery system, which could lead to service interruptions and result in a loss of customers
4. 50If a third party asserts that we are infringing its intellectual property, whether successful or not, it could subject us to costly and time-consuming litigation or require us to obtain expensive licenses, and our business may be adversely affected
5. 51require us to redesign our software and services to avoid infringement
6. 52If the security of our customers’ confidential information stored in our systems is breached or otherwise subjected to unauthorized access, our reputation may be severely harmed, we may be exposed to liability and we may lose the ability to offer our customers a credit card payment option
7. 53We may be the subject of intentional cyber disruptions and attacks
8. 54We may not be able to adequately protect our proprietary technology, and our competitors may be able to offer similar products and services which would harm our competitive position
9. 55We could be harmed by improper disclosure or loss of sensitive or confidential data
10. 56Unauthorized breaches or failures in cybersecurity measures adopted by us and/or included in our products and services could have a material adverse effect on our business
11. 57We may be subject to stringent and changing laws, regulations, standards, and contractual obligations related to privacy, data protection, and data security. Our actual or perceived failure to comply with such obligations could adversely affect our business23% rewritten
12. 58Online applications are subject to various laws and regulations relating to children’s privacy and protection, which if violated, could subject us to an increased risk of litigation and regulatory actions

Risks Related to Owning Our Securities

1. 59The market for our common stock, publicly-traded warrants and series A preferred stock could be considered “thinly-traded,” and an active market in securities may never fully develop
2. 60The price of our securities may fluctuate substantially
3. 61other events or factors, many of which may be out of our control
4. 62Our Company’s series A preferred stock is senior in rank to shares of our common stock with respect to dividends, liquidation and dissolution53% rewritten
5. 63If we complete a reverse stock split, it may decrease the liquidity of our common stock and may not improve trading or investor interestNew
6. 64The issuance of shares underlying the securities issued pursuant to the Senior Secured Notes and related Rights could result in very significant dilution to our existing stockholders and materially depress the market price of our common stockNew
7. 65We may issue additional equity securities, or engage in other transactions that could dilute our book value or relative rights of our common stock and series A preferred stock, which may adversely affect the market price of our securities
8. 66We do not anticipate paying any cash dividends on our common stock in the foreseeable future and, as such, capital appreciation, if any, of our common stock will be your sole source of gain for the foreseeable future
9. 67If research analysts do not publish research about our business or if they issue unfavorable commentary or downgrade our securities, our securities’ price and trading volume could decline
10. 68An investment in our warrants is speculative in nature and could result in a loss of your investment therein
11. 69Notwithstanding the foregoing, these provisions of the warrant certificate will not apply to suits brought to enforce any liability or duty created by the Exchange Act or any other claim for which the federal district courts of the United States of America are the sole and exclusive forum
12. 70Our series A preferred stock has not been rated
13. 71Dividend payments on the series A preferred stock are not guaranteed
14. 72We operate as a holding company dependent upon the assets and operations of our subsidiaries, and because of our structure, we may not be able to generate the funds necessary to make distributions on our series A preferred stock
15. 73Our series A preferred stock will bear a risk of redemption by us
16. 74The potential payment of dividends on our series A preferred stock or redemption of our series A preferred stock is dependent on a number of factors, and payments and redemptions cannot be assured
17. 75The cash distributions you receive on our series A preferred stock may be less frequent or lower in amount than you expect
18. 76Holders of our series A preferred stock will be subject to inflation risk
19. 77An investment in our series A preferred stock bears interest rate risk
20. 78Holders of series A preferred stock will bear reinvestment risk
21. 79Market and economic conditions may negatively impact our business, financial condition and share price
22. 80The ability of a stockholder to recover all or any portion of such stockholder’s investment in the event of a dissolution or termination may be limited
23. 81We are an “emerging growth company” and are able to avail ourselves of reduced disclosure requirements applicable to emerging growth companies, which could make our common stock less attractive to investors
24. 82Financial reporting obligations of being a public company in the United States are expensive and time-consuming, and our management is required to devote substantial time to compliance matters
25. 83If we fail to comply with the rules under Sarbanes-Oxley related to accounting controls and procedures in the future, or, if we discover material weaknesses and other deficiencies in our internal control and accounting procedures, our stock price could decline significantly and raising capital could be more difficult
26. 84Any failure to maintain effective disclosure controls and internal control over financial reporting could have a material and adverse effect on our business and operating results, and cause a decline in the market price of our common stockNew
27. 85Potential comprehensive tax reform bills could adversely affect our business and financial condition
28. 86We can issue “blank check” preferred stock without stockholder approval with the effect of diluting interests of then-current stockholders and impairing their voting rights, and provisions in our charter documents and under Delaware law could discourage a takeover that stockholders may consider favorable
29. 87Our principal stockholders and management own a significant percentage of our stock and will be able to exert significant control over matters subject to stockholder approval
30. 88Anti-takeover provisions contained in our certificate of incorporation and bylaws, as well as provisions of Delaware law, could impair a takeover attempt
31. 89provide that our directors will be elected by a plurality of the votes cast in the election of directors78% rewritten
32. 90Liability of directors for breach of duty is limited under Delaware law
33. 91These limitations of liability do not apply to liabilities arising under the federal or state securities laws and do not affect the availability of equitable remedies such as injunctive relief or rescission
34. 92Provisions in our certificate of incorporation and bylaws may have the effect of discouraging lawsuits against our directors and officers
35. 93If our securities become subject to the penny stock rules, it would become more difficult to trade our shares
36. 94FINRA sales practice requirements may limit a stockholder’s ability to buy and sell our stock
37. 95We are a smaller reporting company and are exempt from certain disclosure requirements, which could make our common stock less attractive to potential investors
38. 96in the case of an issuer whose public float was zero, had annual revenues of less than $100 million during the most recently completed fiscal year for which audited financial statements are available
39. 97Changes in accounting principles and guidance, or their interpretation, could result in unfavorable accounting charges or effects, including changes to our previously filed financial statements, which could cause our stock price to decline