Ryvyl (US:RVYL)2025-11-14 21:02Capital Raising and Financing - The company successfully raised additional capital through private and public equity offerings and debt financings in July 2025 and October 2025[27]. - The Company issued an 8% senior convertible note of $100 million, originally due November 3, 2023, extended to April 5, 2025, with gross proceeds of $84 million after a 16% original issue discount[75]. - The Company entered into a Preferred Stock Repurchase and Note Repayment Agreement, agreeing to pay a total of $17.0 million, with the first installment of $13.0 million paid on January 27, 2025, and a second installment of $4.0 million due by April 30, 2025[85]. - The outstanding balance of the Note was reduced to $4.0 million after the payment of the first installment, and no interest will accrue on this balance until the second installment date[86]. - The Note was fully retired during the quarter ended June 30, 2025, after multiple conversions and repayments totaling $66.25 million[89]. Mergers and Acquisitions - The company entered into a merger agreement with RTB Digital, Inc. on September 28, 2025, with RTB becoming a wholly-owned subsidiary[27]. - The Merger Agreement includes customary representations and covenants, and the Company will continue its current operations post-merger[146]. - The Company has consolidated its operations into one reportable segment following the sale of its wholly owned subsidiary, Ryvyl EU, effective June 1, 2025[154]. Revenue and Operations - Following the sale of Ryvyl EU on June 1, 2025, the company primarily generates revenue from banking services, including ACH and wire transfer transactions[36]. - For the three months ended September 30, 2025, the revenue from discontinued operations was $0, compared to $9.774 million for the same period in 2024, representing a decline of 100%[61]. - The company continues to focus on accelerated business development efforts to drive volumes across diversified business verticals[27]. Financial Performance and Impairments - The company recorded an impairment charge of $1.1 million for previously capitalized software development costs during the quarter ended June 30, 2025[47]. - An additional impairment charge of $0.1 million was recorded during the quarter ended September 30, 2025, related to operating lease ROU assets[50]. - The company recognized a loss on the sale of its subsidiary Ryvyl EU amounting to approximately $6.5 million during the quarter ended June 30, 2025, following the sale for total consideration of $16.5 million[59]. - The company's total accrued liabilities decreased from $8.146 million as of December 31, 2024, to $5.316 million as of September 30, 2025, reflecting a reduction of approximately 34%[66]. - The company's net property and equipment decreased from $165,000 as of December 31, 2024, to $115,000 as of September 30, 2025, a decline of approximately 30%[62]. Tax and Deferred Assets - The company reported a provision for income taxes of $136,000 for the three months ended September 30, 2024, compared to a provision of $577,000 for the nine months ended September 30, 2025[61]. - The company has a full valuation allowance on its deferred tax assets as of September 30, 2025, indicating uncertainty regarding the realization of these assets[54]. - The effective income tax rate for the 2025 calendar year is estimated at (7.2%), differing from the U.S. federal statutory rate due to a full valuation allowance[127]. Legal Matters - The Company is involved in ongoing legal proceedings, including a complaint filed by a former Chief Marketing Officer alleging discrimination and retaliation[149]. - The Company reached an agreement in principle to settle all claims in the Cullen v. RYVYL Inc. lawsuit for a total of $1,000,000, which includes $300,000 in cash and 700,000 shares of common stock[151]. - The Company is engaged in ongoing litigation, including a shareholder derivative complaint against certain officers and directors for alleged failures in internal controls[151]. - The Company filed a demand for arbitration against Sky Financial for breach of contract, seeking damages and costs incurred[150]. - The Company intends to vigorously defend against all claims in the lawsuit filed by Rachael Mora alleging sex discrimination and retaliation[155]. Stock and Compensation - Stock-based compensation expense is recorded on a straight-line basis over the requisite service period, with fair value determined at grant date[52]. - The Company adopted the 2023 Equity Incentive Plan, allowing for the grant of up to 5,098,262 shares of common stock to employees and consultants[129]. - As of September 30, 2025, the outstanding stock options decreased to 539,304 shares, with an average exercise price of $4.30, down from 583,974 shares at the end of 2024[130]. - The total grant date fair value of Restricted Stock Awards (RSAs) that vested was $0.1 million for the nine months ended September 30, 2025, compared to $0.3 million for the same period in 2024[131]. - The Company granted 2,288,000 Restricted Stock Units (RSUs) with an average grant date fair value of $0.85, with 613,373 units vested and 518,875 units forfeited by September 30, 2025[132]. Management Changes - Fredi Nisan retired as CEO effective October 31, 2025, with George Oliva appointed as interim CEO[158]. - Fredi Nisan will receive a cash payment of $350,000 as part of his severance agreement, payable over a twelve-month period following his retirement[141]. Debt and Liabilities - As of September 30, 2025, the Company reported total debt of $628,000, with long-term debt net at $615,000[74]. - The Company recorded a loss on extinguishment of $1.3 million related to the First Exchange Agreement due to the addition of a substantive conversion option[79]. - The Second Exchange Agreement resulted in a loss on extinguishment of $22.5 million, reflecting the fair value of the modified Note and the Series B Preferred Stock issued[82]. - The Note bore an interest rate of 8% per annum, which would increase to 15% upon an event of default[93]. - The Company is required to pay a late charge of 15% on any principal amount not paid when due[96].