Company: OTSA
Filing Date: 2025-06-09
Form Type: F-1
Source: 0001213900-25-052720
Chunk: 58

Company: OTSAW Ltd
Filing Date: 2025-06-09
Form: F-1
Chunk 58
---
 of our net sales are made to distributors, accounting for approximately 4% and 9% of our net sales in fiscal years 2024 and 2023. The impairment or termination of our relationships with our distributors, or the failure of these parties to diligently market, sell, or lease our products and comply with applicable laws and regulations, could materially and adversely affect our ability to generate revenue and profits. We plan to continue expanding into international markets through our distributors. We may face significant challenges and risks in managing a geographically dispersed distribution network. Since our distributors control the relationships with some of our end customers, if our relationship with any distributor ends, we could also lose our relationships with these customers. In addition, if a dispute arises with a distributor or if a distributor is terminated by us or goes out of business, it may take time to find an alternative distributor, and to train new personnel to market our products, and our ability to sell our products in the region formerly serviced by such terminated distributor could be harmed. We have limited control over our third -partydistributors. Our distributors and its agents may be unable to successfully market, lease and sell our products and may not devote sufficient time and resources to support the marketing, sales, education and training efforts that is necessary for our products to develop, achieve or sustain market acceptance. Additionally, in some international jurisdictions, we rely on our distributors to manage the regulatory process, obtain the requisite regulatory approvals for our products to operate, and comply with all applicable rules and regulations. We are dependent on their ability to do so effectively, and any failure by them to do so could harm our reputation, business, financial condition and results of operations. In addition, some of our distributors do not sell our products exclusively, and they may focus their sales efforts and resources on other products that produce better margins or greater commissions for them or products where they have a strategic relationship with the supplier. We do not control the sales representatives and other employees of our distributors, and we cannot guarantee that our sales processes, regulatory compliance and other priorities will be consistently communicated and executed. In addition, we may not have staff in the locations covered by our distributors, which makes it particularly difficult for us to monitor their performance. While we may take steps to mitigate the risks associated with noncompliance by our distributors, there remains a risk that they will not comply with the local regulatory requirements or our requirements and compliance policies. If the services of any of these third -partydistributors and its agents become unsatisfactory, we may