Company: ACCS
Filing Date: 2025-03-25
Form Type: 10-K
Source: 0000843006-25-000012
Chunk: 361

Company: ACCESS Newswire Inc.
Filing Date: 2025-03-25
Form: 10-K
Item: Item 1A
Chunk 361
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113 (including 32 independent contractors) as of December 31, 2024. We anticipate that additional investments in sales personnel, infrastructure and research and development spending will be required to:

 ·scale our operations and increase productivity;

 ·address the needs of our customers;

 ·further develop and enhance our existing solutions and offerings; and

 ·develop new technology.

We cannot assure you that our controls, systems and procedures will be adequate to support our future operations or that we will be able to manage our growth effectively. We also cannot assure you that we will be able to continue to expand our market presence in the United States and other current markets or successfully establish our presence in other markets. Failure to effectively manage growth could result in difficulty or delays in deploying customers, declines in quality or customer satisfaction, increases in costs, difficulties in introducing new features or other operational difficulties, and any of these difficulties could adversely impact our business performance and results of operations.

There are risks and uncertainties associated with the sale of our Compliance business.

On February 28, 2025, we sold our Compliance business to the Buyer for aggregate cash consideration of $12,500,000, with $12,000,000 of the purchase price paid at closing and $500,000 retained by the Buyer as a holdback for a period of 12 months post-closing to satisfy potential indemnification claims by the Buyer under the Purchase Agreement if any. We used the entire $12,000,000 in closing cash to reduce our indebtedness to Pinnacle Bank.  As such, we did not receive any cash at closing as a result of the sale of our Compliance business.

Our Compliance business has historically provided strong revenue and cash flow at high gross margins.  While we believe our Communications business, which has been our primary focus for approximately the last 10 years, will be a strong stand-alone business, there can be no guaranty that it will be able to replace the revenue and cash flow of the Compliance business, which would result in a material adverse effect on our business, financial condition and results of operations.  

Additionally, the sale of our Compliance business required us to separate and allocate specific assets to the business, including some shared assets. We could face disputes with the Buyer regarding whether or not certain assets were included in the sale. Moreover, we agreed, for a period of time after the sale pursuant to a Transition Services Agreement, to continue to perform certain services that we historically performed for the Compliance business, and we also undertook