Risks Related to the Company's Emergence from Chapter 11
Risks Related to the Investigations and Internal Control over Financial Reporting
Risks Related to Our Business
Risks Related to Our Financial Results
We recently emerged from bankruptcy, which could adversely affect our business and business relationships.
Our long-term liquidity requirements and the adequacy of our capital resources are difficult to predict at this time.
Our actual financial results after Emergence may not be comparable to our historical financial information or to our projections filed with the Bankruptcy Court.
It may be difficult for us to attract and retain employees, including members of our senior management, as a result of the Chapter 11 Cases.
There is no public market for our New Common Stock, and we cannot assure you that an active trading market will develop for the New Common Stock.
Certain stockholders own a significant portion of our outstanding voting stock and hold the right to appoint five of the nine seats on our Board. Concentration of ownership among such stockholders may prevent you from influencing significant corporate decisions.
Upon Emergence, our Board significantly changed and may implement changes in our business strategy that could negatively affect the scope and results of our future operations.
The Investigations and the findings thereof have diverted, and may continue to divert, management and other human resources from the operation of our business.
If we do not successfully execute our business strategy, which depends in part on our ability to increase our share of the market for cloud-based solutions, software and services offerings, our business could be materially and adversely affected.
Our business communications solutions and services may not match market opportunities and the new solutions and services we develop may not keep pace with rapidly changing technology, evolving industry standards and customer preferences.
We may not be successful in transitioning customers from a perpetual license to a subscription-based, recurring revenue model.
The timing of our cash flows may be negatively impacted as we shift more of our business to a subscription-based, recurring revenue model.
We may not be successful in executing elements of our strategic operating plan, which may have a material adverse impact on our business, financial results and results of operations.
Our strategic operating plan relies in part upon the successful execution of our strategic partnership with RingCentral, as well as our ability to meet our obligations pursuant to the Amended and Restated RingCentral Agreements, which may not be successful.
We face formidable competition from providers of unified communications and contact center solutions and services, including cloud-based solutions, and this competition may negatively impact our business and limit our growth.
Industry consolidation and new adjacent player business models may lead to stronger competition and may harm our business, operating results and financial condition.
We depend on our indirect sales channel.
We rely on third-party contract manufacturers, component suppliers and partners (some of which are sole source and limited source suppliers) and warehousing and distribution logistics providers. If these relationships are disrupted and we are unable to obtain substitute manufacturers, suppliers or partners, on favorable terms or at all, our business, operating results and financial condition may be harmed.
Contracting with government entities can be complex, expensive and time-consuming.
If we are unable to successfully complete acquisitions and/or strategic alliances and effectively integrate acquired businesses, our business, operating results and financial condition may be adversely affected.
Social and ethical issues relating to the use of AI in our offerings may result in reputational harm or liability.
Business communications solutions are complex, and design defects, errors, failures or “bugs” may be difficult to detect and correct and could harm our reputation, result in significant costs to us and cause us to lose customers.
We are dependent on our intellectual property. If we are not able to protect our proprietary rights or if those rights are invalidated or circumvented, our business may be adversely affected.
We may be subject to litigation and infringement claims, which could cause us to incur significant expenses or prevent us from selling our products or services.
Certain software we use is from open source code sources, which, under certain circumstances, may lead to unintended consequences and, therefore, could materially adversely affect our business, operating results and financial condition.
Failure to comply with laws and contractual obligations related to data privacy and protection could have a material adverse effect on our business, operating results and financial condition.
A breach of the security of our information systems, products or services or of the information systems of our third-party providers could adversely affect our business, operating results and financial condition.
Since we operate internationally, operational, logistical, economic and/or political challenges in a specific country or region could negatively affect our revenue, costs, expenses and financial condition or those of our channel partners and distributors.
Our business has been affected by the military operation launched by Russia against Ukraine.
We rely on third parties to provide certain data hosting services to us or to our customers, and interruptions or delays in those services could harm our business.
If we do not comply with certain telecommunications or other rules and regulations, we could be subject to enforcement actions, fines, loss of licenses and possibly restrictions on our ability to operate or offer certain of our services.
Changes in U.S. trade policy, including the imposition of tariffs and the resulting consequences, may have a material adverse impact on our business, operating results and financial condition.
We recorded a significant charge to earnings as a result of our goodwill and intangible assets becoming impaired. If our intangible assets become further impaired, we may be required to record a significant charge to earnings.
Shifts in the mix of sizes or types of organizations that purchase our solutions or changes in the components of our solutions purchased by our customers could affect our gross margins and operating results.
Levels of returns on pension and post-retirement benefit plan assets, changes in interest rates and other factors affecting the amounts to be contributed to fund future pension and post-retirement benefit plan liabilities could adversely affect our cash flows, operating results and financial condition in future periods.
We are exposed to risks inherent in our defined benefit pension plans in Germany.
We have substantial debt and may be unable to generate sufficient cash flows from operations to meet our debt service and other obligations.
Our ability to retain and attract executives and other key personnel is critical to the success of our business and execution of our growth strategy.
Business and/or supply chain interruptions, whether due to catastrophic disasters or other events, could adversely affect our operations.
If we are unable to achieve our cost-reduction goals or we experience another earnings shortfall, we may have to perform additional cost-reduction measures such as a further reduction in force.
We are exposed to the credit risk of some of our clients and customers, which may harm our operating results and financial condition.
The Company could be subject to changes in its tax rates, the adoption of new U.S. or international tax legislation or exposure to additional tax liabilities, which could have a material and adverse impact on the Company's operating results, cash flows and financial condition.
Tax examinations and audits could have a material and adverse impact on the Company's cash flows and financial condition.
Our reputation and/or business could be negatively impacted by ESG matters and/or our reporting of such matters.
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