Volato Group (SOAR) risk factors, FY2024 10-K

Risks Related to Our Limited Operating History, Business and Industry

1. 01We have a limited operating history and history of net losses, and may continue to experience net losses in the future
2. 02The Company may not be able to continue to operate its business if it is not successful in securing additional sources of capital and, as a result, may not be able to continue as a going concern
3. 03Significant reliance on Gulfstream aircraft and parts poses risks to our business and prospects
4. 04If we cannot internally or externally finance our aircraft or generate sufficient funds to make payments to external financing sources, we may not succeed
5. 05We may not be able to successfully implement our growth strategies
6. 06We are exposed to the risk of a decrease in demand for private aviation services
7. 07We may require substantial additional funding to finance our operations, but adequate additional financing may not be available when we need it, on commercially acceptable terms, or at all
8. 08The loss of key personnel upon whom we depend on to operate our business or the inability to attract additional qualified personnel could adversely affect our business
9. 09Federal, state, and local tax rules can adversely impact our results of operations and financial position
10. 10The Company’s ability to utilize its net operating loss and tax credit carryforwards to offset future taxable income may be subject to certain limitations
11. 11If our efforts to continue to build our strong brand identity and achieve high customer satisfaction and loyalty are not successful, we may not be able to attract or retain customers, and our operating results may be adversely affected
12. 12A delay or failure to identify and devise, invest in, and implement certain important technology, business, and other initiatives could have a material impact on our business, financial condition and results of operations
13. 13We rely on our information technology systems to manage numerous aspects of our business. A cyber-based attack of these systems could disrupt our ability to deliver services to our customers and could lead to increased overhead costs, decreased revenues, and harm to our reputation
14. 14System failures, defects, errors, or vulnerabilities in our website, applications, backend systems, or other technology systems or those of third-party technology providers could harm our reputation and brand and adversely impact our business, financial condition, and results of operations
15. 15If we are unable to adequately protect our intellectual property interests or are found to be infringing on the intellectual property interests of others, we may incur significant expense, and our business may be adversely affected
16. 16As part of our growth strategy, we may engage in future acquisitions that could disrupt our business and have an adverse impact on our financial condition
17. 17We may never realize the full value of our intangible assets or our long-lived assets, causing us to record impairments that may materially adversely affect our financial conditions and results of operations

Risks Related to Legal and Regulatory Matters

1. 18Because our software could be used to collect and store personal information, privacy concerns in the territories in which we operate could result in additional costs and liabilities to us or inhibit sales of our software

Risks Related to Our Contractual Obligations

1. 19Our obligations in connection with our contractual obligations, including debt financing obligations, could impair our liquidity and thereby harm our business, results of operations, and financial condition
2. 20Agreements governing our debt obligations include financial and other covenants that provide limitations on our business and operations under certain circumstances, and failure to comply with any of the covenants in such agreements could adversely impact us
3. 21(1) For the avoidance of any doubt, this price reflects the purchase price after calculation (i.e. after discounts to the market price of our shares) in accordance with the terms of the initial tranche Note and the Securities Purchase Agreement
4. 22(4) Represents the initial Floor Price of the Note issued in the initial tranche, as adjusted pursuant to the 1-for-25 reverse stock split effected by the Company on February 24, 2025
5. 23(6) Represents the current Conversion Price of the Note issued in the Initial Tranche, as adjusted pursuant to the 1-for-25 reverse stock split effected by the Company on February 24, 2025

Risks Related to Ownership of Our Securities and Being a Public Company

1. 24If we are unable to comply with the continued listing requirements of the NYSE American, including satisfying the obligations set forth in the Deficiency Letter with respect to our stockholders’ equity being below the NYSE American’s minimum level, then our Common Stock will be delisted from the NYSE American
2. 25If our Common Stock is delisted from the NYSE American, then we could face significant and material adverse consequences as a result and our investors will experience limitations upon their ability to effect transactions in our Common Stock
3. 26Sales of Common Stock, or the perception of such sales, by us in the public market or otherwise, could cause the market price for our Common Stock to decline
4. 27Anti-takeover provisions contained in the Company’s Certificate of Incorporation and applicable laws could impair a takeover attempt
5. 28Claims for indemnification by our directors and officers may reduce our available funds to satisfy successful third-party claims against us and may reduce the amount of money available to us
6. 29Our Certificate of Incorporation designates specific courts as the exclusive forum for substantially all stockholder litigation matters, which could limit the ability of our Stockholders to obtain a favorable forum for disputes with us or our directors, officers or employees
7. 30Our management team has limited experience managing a public company
8. 31The requirements of being a public company may strain our resources, divert our management’s attention, and affect our ability to attract and retain qualified board members
9. 32We may be subject to securities litigation, which is expensive and could divert our management’s attention
10. 33Because we became a publicly traded company by means other than a traditional underwritten initial public offering, our stockholders may face additional risks and uncertainties
11. 34If securities or industry analysts do not publish research or reports about our business, if they change their recommendations regarding our Common Stock, or if our operating results do not meet their expectations, our Common Stock price and trading volume could decline
12. 35The JOBS Act permits “emerging growth companies” like us to take advantage of certain exemptions from various reporting requirements applicable to other public companies that are not emerging growth companies