Company: SONM
Filing Date: 2025-10-31
Form Type: 10-Q
Source: 0001493152-25-020310
Chunk: 94

Company: SONIM TECHNOLOGIES INC
Filing Date: 2025-10-31
Form: 10-Q
Item: Item 4
Chunk 94
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costs, fees, expenses and charges related to the proposed transaction, including legal, accounting, financial advisor, filing, printing
and mailing fees, which may materially and adversely affect our financial condition and results of operations.

In
addition, the Asset Purchase Agreement generally requires the Company to operate its business in the ordinary course of business consistent
with past practice, pending consummation of the Asset Purchase Agreement, and also restricts us from taking certain actions with respect
to our business and financial affairs without the consent of Social Mobile. Such restrictions will be in place until the Asset Purchase
Agreement is either consummated or terminated. Such restrictions could adversely affect our business and results of operations prior
to completion of the Asset Purchase Agreement.

34

We
may never consummate a transaction complementary to the Asset Purchase Agreement, and even if we do, we may not be able to complete the
transaction timely, which may negatively impact our financial condition, results of operations, and our ability to raise capital. 

We
publicly announced our intent to pursue two contemporaneous strategic tracks: to enter into and consummate the Asset Purchase Agreement
and to identify an RTO target and to consummate an RTO.

Expected
disposition of our legacy assets and operations under the Asset Purchase Agreement will render Sonim a “shell company,” unless
we either (a) initiate a new line of business that is unrelated to and does not compete with the divested business, or (b) complete an
alternative transaction (such as an RTO) before the closing of the Asset Purchase Agreement. Accordingly, identifying a suitable RTO
target or investors for an alternative transaction and completing an alternative transaction in a timely manner—or otherwise ensuring
the continuation of meaningful business operations—is critical to avoiding shell company status.

If
Sonim becomes a shell company, we would be subject to significant regulatory and market disadvantages, including:

    ●
    ineligibility
    to use Form S-3 until 12 full calendar months after filing “Form 10 information” with the SEC; 

    ●
    holders
    of our common stock will not be able to sell their restricted shares due to Rule 144(i), until one year after the Form 10 information
    is filed with the SEC;

    ●
    the
    Company will become an “ineligible issuer for three years following the closing, which will prevent the combined company from
    (i) incorporating by reference in its Form S-1 filings, (