Company: SONM
Filing Date: 2025-10-31
Form Type: 10-Q
Source: 0001493152-25-020310
Chunk: 78

Company: SONIM TECHNOLOGIES INC
Filing Date: 2025-10-31
Form: 10-Q
Item: Item 3
Chunk 78
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significant transaction costs and termination fees, and the focus of our management would have been diverted from seeking other potential
strategic opportunities, in each case without realizing any benefits of the proposed transactions.

For
these and other reasons, not consummating the proposed transactions could adversely affect our business and results of operations. Furthermore,
if we do not consummate the proposed transaction, the price of our common stock may decline significantly from the current market price,
and you may not recover your investment. Certain costs associated with the proposed transactions have already been incurred or may be
payable even if the proposed transactions are not consummated. Finally, any disruptions to our business resulting from the announcement
and pendency of the transaction, including any adverse changes in our relationships with our customers, vendors, and employees or recruiting
and retention efforts, could accelerate in the event of or continue following a failed transaction.

35

The
Asset Purchase Agreement contains a termination fee and restrictions on solicitation that limit our ability to pursue alternatives to
the Asset Purchase Agreement.

Under
the Asset Purchase Agreement, we are restricted from soliciting, initiating, inducing, or knowingly encouraging or knowingly facilitating
alternative acquisition proposals from third parties, and/or providing non-public information to third parties relating to any inquiries,
proposals or offers that would reasonably be expected to lead to certain transactions involving a third party, including a merger, business
combination or similar transaction, subject to specified exceptions, including the solicitation of an RTO transaction that is not impacting
the disposition of the legacy business. The Asset Purchase Agreement also contains termination provisions for both us and Buyer, including
the right of the Company to terminate the Asset Purchase Agreement to accept a Superior Proposal (as defined in the Asset Purchase Agreement),
subject to and in accordance with the terms and conditions of the Asset Purchase Agreement, and provides that, in connection with the
termination of the Asset Purchase Agreement by us to enter into an alternative acquisition agreement providing for a Superior Proposal,
we will pay the Buyer (i) reimbursement of transaction-related expenses reasonably incurred by the Buyer and its affiliates, and (ii)
a termination fee of $1 million. These provisions could discourage a third party that may have an interest in acquiring all or a significant
part of our business from considering or proposing that acquisition, even if such third party were prepared to pay consideration with
a higher value than the value of the consideration in the Asset Purchase Agreement.

We
may face litigation filed against us over the Asset Purchase Agreement, an RTO, or an alternative