Stock Performance and Market Risks - The last reported sales price of the Common Stock was $6.45, with the exercise price of the Public Warrants being higher than this market price[87]. - The trading market for the Common Stock may be affected by the lack of coverage from securities analysts, which could negatively impact the stock price[85]. - A prolonged decline in the price of Common Stock could adversely affect the company's liquidity and ability to raise capital[105]. - The company cannot predict market price fluctuations for its common stock, which may be affected by factors beyond its control[111]. Corporate Governance and Ownership Structure - The concentration of ownership by executive officers and directors, who control approximately 70.5% of the voting power, may limit stockholder influence on corporate matters[100]. - The concentration of ownership by a limited number of affiliated stockholders may limit interest in the company's securities[109]. - Anti-takeover provisions in the company's certificate of incorporation could impair a takeover attempt[114]. - Special meetings of stockholders can only be called by the board of directors, potentially delaying stockholder actions[115]. - The Court of Chancery of the State of Delaware is designated as the exclusive forum for certain stockholder litigation matters, which could limit stockholders' options[115]. Financial and Tax Considerations - The company has not capitalized any software development costs during the years ended December 31, 2023, and 2022[97]. - The company does not intend to pay any cash dividends in the foreseeable future, with returns on investment expected to come from increases in the fair market value of the capital stock[107]. - The company may face additional tax liabilities due to changes in tax laws, particularly related to research and experimental expenditures[74][75]. Operational Risks - The company is subject to significant costs associated with public company governance and reporting requirements, which may strain resources and distract management[101]. - The company may be subject to litigation risks due to increased visibility from public disclosures, which could divert management resources[82]. - Regulatory developments affecting the industry could impact the company's operations[110]. - The company faces risks related to the realization of risk factors presented in its annual report[109]. - Additions or departures of key personnel may impact the company's performance[109]. - The company's ability to execute its business plan is crucial for maintaining market confidence[111]. Company Classification - The company is classified as a "smaller reporting company" and an "emerging growth company," allowing it to take advantage of certain reporting exemptions[89]. - The company is classified as a "smaller reporting company" and "emerging growth company," which may make its common stock less attractive to investors[112].
BYTE Acquisition (BYTS) - 2023 Q4 - Annual Report