RTB Digital (RTB) risk factors, FY2024 10-K

Risks Related to Our Business and Industry

1. 01Our financial situation creates doubt whether we will continue as a going concern
2. 02We have entered into a Securities Purchase Agreement to sell a material subsidiary, which represents a substantial portion of our current business. Additionally, we may be required to pay significant liquidated damages if the prospective purchaser is unable to close the acquisition
3. 03The loss of key personnel or the inability of replacements to quickly and successfully perform in their new roles could adversely affect our business
4. 04Our executive officers, directors, and principal shareholders maintain the ability to control substantially all matters submitted to shareholders for approval
5. 05Low demand for new products and the inability to develop and introduce new products at favorable margins could adversely impact our performance and prospects for future growth
6. 06A prolonged economic downturn could adversely affect our business
7. 07The payments technology industry is highly competitive and highly innovative, and some of our competitors have greater financial and operational resources than we do, which may give them an advantage with respect to the pricing of services offered to customers and the ability to develop new and disruptive technologies
8. 08We could face substantial competition, which could reduce our market share and negatively impact our net revenue
9. 09Litigation may adversely affect our business, financial condition and results of operations
10. 10Expectations relating to environmental, social, and governance (ESG) considerations could expose us to potential liabilities, increased costs, and reputational harm
11. 11Adverse developments affecting the financial services industry, including events or concerns involving liquidity, defaults or non-performance by financial institutions, have and could in the future, adversely affect our business, financial condition, results of operations, or prospects
12. 12Our business is dependent on our strategic banking relationships to process our electronic transactions. If we are unable to secure or retain a banking partner due to market conditions in the financial services industry, our financial condition will be materially affected
13. 13Fluctuations in exchange rates could have a material and adverse effect on our results of operations and the value of your investment
14. 14Changes to U.S. tariff and import/export regulations may affect our portfolio companies, and may negatively impact our business, results of operations or financial condition
15. 15We are currently operating in a period of severe capital markets disruptions and economic uncertainty which could impair our Company’s financial position and operating results and affect the industries in which we conduct our business and, in turn, harm our operating results

Risks Related to Our Financial Position and Need for Capital

1. 16Our revenue projections related to our new licensing arrangements with payment services providers may not materialize due to customer acquisition and banking compliance issues that are outside of our control
2. 17Our financial statements may be materially affected if our estimates prove to be inaccurate as a result of our limited experience in making critical accounting estimates
3. 18The restatement of our historical financial statements has consumed a significant amount of our time and resources and may continue to do so
4. 19Our financial statements may be materially affected as a result of material weaknesses in internal accounting controls
5. 20We will require additional financing to sustain or grow our operations. Raising additional capital may cause dilution to our existing stockholders and investors, restrict our operations or require us to relinquish rights to our products and/or product candidates on unfavorable terms to us
6. 21We may not realize the anticipated benefits of acquisitions or investments in joint ventures, or those benefits may be delayed or reduced in their realization
7. 22Our operating results may fluctuate significantly as a result of a variety of factors, many of which are outside of our control, which could cause fluctuations in the price of our securities

Risks Related to Cybersecurity, Information Technology, and Intellectual Property

1. 23We are increasingly dependent on information technology, and potential cyberattacks, security problems, or other disruption and expanding social media vehicles present new risks
2. 24Business interruptions or systems failures may impair the availability of our websites, applications, products or services, or otherwise harm our business
3. 25Software and hardware defects, failures, undetected errors and development delays could affect our ability to deliver our services, damage customer relations, expose us to liability and have an adverse effect on our business, financial condition and results of operations
4. 26Privacy regulation is an evolving area and compliance with applicable privacy regulations may increase our operating costs or adversely impact our ability to service our clients and market our products and services
5. 27Third-party claims of infringement against us could adversely affect our ability to market our products and require us to redesign our products or seek licenses from third parties
6. 28We are highly dependent on information systems and systems failures or interruption could significantly disrupt our business, which may, in turn, negatively affect our financial results and the market price of our common stock
7. 29If we cannot keep pace with rapid technological developments to provide new and innovative products and services, the use of our products and services and, consequently, our revenues, could decline

Risks Related to Owning Our Common Stock

1. 30We are subject to increased costs as a result of operating as a public company, and our management is required to devote substantial time to new compliance initiatives
2. 31If we are not able to comply with the applicable continued listing requirements or standards of Nasdaq, our common stock could be delisted from Nasdaq
3. 32In the event that our common stock is delisted from Nasdaq, U.S. broker-dealers may be discouraged from effecting transactions in shares of our common stock because it may be considered a penny stock and thus be subject to the penny stock rules
4. 33If securities or industry analysts do not publish research, or publish inaccurate or unfavorable research, about our business, our stock price and our trading volume could decline