TPT Global Tech (TPTW) Risk Analysis
Risk Overview Q3, 2024
Source: the company's latest filing for the period ended Sep 30, 2024, filed Feb 07, 2025
Risk Change Over Time
- Share Price & Shareholder Rights - Risk 1Stock Options
There are currently no stock options outstanding. On October 14, 2017, the Board of Directors and majority stockholders of TPT approved the 2017 TPT Global Tech, Inc. Stock Option and Award Incentive Plan ("the 2017 Plan.") There are 20,000,000 shares of our common stock reserved under the 2017 Plan. On February 1, 2024, by unanimous written consent, the Board of Directors and Majority Shareholder of TPT Global Tech, Inc. (the "Company") approved and adopted an amendment and restatement of the 2024 TPT Global Tech, Inc. Stock Option, Compensation, and Award Incentive Plan (the "Plan") to increase the maximum number of common shares, with a par value of $0.001 ("Common Shares"), available for grant to participants under the Plan to 3,500,000,000 Common Shares. In addition, the Plan was amended to define "Eligible Person" as an Employee, Consultant (Person or Professional Services Company) or Director of the Company, any Parent or any Subsidiary. A company other than a Professional Services Company is NOT eligible and "Issuance for Compensation for Services" shall mean the issuance for valuable and adequate consideration determined by the Board as determined by performance pursuant to an agreement. This Plan amends and supersedes any and all prior Plans.
- Share Price & Shareholder Rights - Risk 2Our officers and directors may have conflicts of interests as to corporate opportunities which we may not be able or allowed to participate in.
Presently there is no requirement contained in our Articles of Incorporation, Bylaws, or minutes which requires officers and directors of our business to disclose to us business opportunities which come to their attention. Our officers and directors do, however, have a fiduciary duty of loyalty to us to disclose to us any business opportunities which come to their attention, in their capacity as an officer and/or director or otherwise. Excluded from this duty would be opportunities which the person learns about through his involvement as an officer and director of another company. We have no intention of merging with or acquiring business opportunity from any affiliate or officer or director. (See "Conflicts of Interest" at page 81.)
- Share Price & Shareholder Rights - Risk 3Our directors' liability to us and our shareholders is limited.
Florida Statutes exclude personal liability of our directors and our stockholders for monetary damages for breach of fiduciary duty except in certain specified circumstances. Accordingly, we will have a much more limited right of action against our directors that otherwise would be the case. This provision does not affect the liability of any director under federal or applicable state securities laws.
- Share Price & Shareholder Rights - Risk 4We will continue to be a reporting company due to the effectiveness of a Form 8-A to be filed concurrent with the acceptance of the NASDAQ listing.
We are subject to the reporting requirements under the Securities and Exchange Act of 1934, Section 13a, due to the effectiveness of previous offerings, pursuant to Section 15d of the Securities Act and we intend to be registered under Section 12(b) concurrent with a NASDAQ listing. As a result, shareholders will have access to the information required to be reported by publicly held companies under the Exchange Act and the regulations thereunder. As a result, we will be subject to legal and accounting expenses that private companies are not subject to and this could affect our ability to generate operating income.
- Share Price & Shareholder Rights - Risk 5We may not successfully meet the NASDAQ Requirements for a listing of our stock, in which case this offering will not occur.
NASDAQ Requirements for listing include the following: a)$4.00 trading price for 30 trading days. Reverse Split of the issued and outstanding shares is necessary in order to meet this criteria, which must be accomplished by the Company, and has not yet been completed. b)$4,000,000 net shareholder's equity to be accomplished through this offering. c)SEC Section 12(b) Registration which has not been achieved. d)At least 100,000 shares of public float. This criteria has been accomplished. e)A minimum of 300+ shareholders. This criteria has been accomplished. f)Total assets of $4,000,000. Will be accomplished through this offering. g)At least two market makers. h)Public float market value of $1,000,000. This criteria has been accomplished. i)Specific corporate governance such as committees and independent Directors in those committees. To be determined prior to effectiveness.
- Debt & Financing - Risk 6We may not be able to successfully implement our business strategy without substantial additional capital. Any such failure may adversely affect the business and results of operations.
Unless we can generate revenues sufficient to implement our Business Plan, we will need to obtain additional financing through debt or bank financing, or through the sale of shareholder interests to execute our Business Plan. We expect to need at least $50,000,000 in the next twelve months in capital or loans to complete our plans and operations. We may not be able to obtain this financing at all. We have not sought commitments for this financing, and we have no terms for either debt or equity financing, and we realize that it may be difficult to obtain on favorable terms. Moreover, if we issue additional equity securities to support our operations, Investor holdings may be diluted. Our business plans are at risk if we cannot continually achieve additional capital raising to complete our plans.
Risk Highlights Q3, 2024
Risk Word Cloud
Risk Factors Full Breakdown - Total Risks 25
- Share Price & Shareholder Rights - Risk 1We can give no assurance of success or profitability to our investors.
Cash flows generated from operating activities were not enough to support all working capital requirements for the years ended December 31, 2023 and 2022. Financing activities described below have helped with working capital and other capital requirements. We incurred $10,401,590 and $21,749,920, respectively, in losses, and we used $525,539 and $226,493, respectively, in cash for operations for the years ended December 31, 2023 and 2022. We calculate the net cash used by operating activities by decreasing, or increasing in case of gain, our let loss by those items that do not require the use of cash such as depreciation, amortization, promissory note issued for research and development, note payable issued for legal fees, derivative expense or gain, gain on extinguishment of debt, loss on conversion of notes payable, impairment of goodwill and long-lived assets and share-based compensation which totaled to a net $6,259,293 for 2023 and $16,746,502 for 2022. In addition, we report increases in assets and reductions in liabilities as uses of cash and decreases in assets and increases in liabilities as sources of cash, together referred to as changes in operating assets and liabilities. For the year ended December 31, 2023, we had a net increase in our assets and liabilities of $3,738,248 primarily from an increase in accounts payable from lag of payments for accounts payable for cash flow considerations and an increase in the balances from our operating lease liabilities. For the year ended December 31, 2022, we had a net increase to our assets and liabilities of $4,776,925 for similar reasons. Cash flows from financing activities were $483,363 and $(180,525) for the years ended December 31, 2023 and 2022, respectively. For the year ended December 30, 2023, these cash flows were generated from proceeds from convertible notes, loans and advances of $433,500 and from notes payable – related parties of $166,188 offset by payment on convertible loans, advances and factoring agreements of $83,620. For the year ended December 31, 2022, these cash flows were generated from proceeds from convertible notes, loans and advances of $1,256,187 offset by payment on convertible loans, advances and factoring agreements of $1,391,580. Cash flows provided by (used in) investing activities were $0 and $(22,747), respectively, for the years ended December 31, 2023 and 2022 primarily related to the acquisition of property and equipment for 2022. These factors raise substantial doubt about the ability of the Company to continue as a going concern for a period of one year from the issuance of these financial statements. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. In order for us to continue as a going concern for a period of one year from the issuance of these financial statements, we will need to obtain additional debt or equity financing and look for companies with cash flow positive operations that we can acquire. There can be no assurance that we will be able to secure additional debt or equity financing, that we will be able to acquire cash flow positive operations, or that, if we are successful in any of those actions, those actions will produce adequate cash flow to enable us to meet all our future obligations. Most of our existing financing arrangements are short-term. If we are unable to obtain additional debt or equity financing, we may be required to significantly reduce or cease operations.
- Share Price & Shareholder Rights - Risk 2Sales of common stock resulting from issuances of common stock for conversions by our convertible noteholders or Rule 144 sales in the future will have a depressive effect on our common stock price.
Most of our convertible noteholders have rights to convert their notes at significant discounts to the market prices as shown in the schedule below, for sale under the requirements of Rule 144 or other applicable exemptions from registration under the Act and perhaps under registration statements which the company is preparing to file in the next thirty days. Rule 144 provides in essence that a person who has held restricted securities for six months or is deemed to have held them due to the issuance by the Company of convertible notes under certain conditions, may sell those shares in brokerage transactions. There is no limit on the amount of restricted securities that may be sold by a non-affiliate after the owner has held the restricted securities for a period of six months. A sale under Rule 144 or under any other exemption from the Act, if available, or pursuant to subsequent registration of shares of common stock of present stockholders underlying the convertible notes, will have a depressive effect upon the price of the common stock in the market, since they are issued at a discount to market-often 50-60% of the lowest bid for differing periods, and sales can be expected at some discounted prices, with larger than normal volumes. We have also issued preferred stock and options and warrants that allow for the purchase of shares at significant discounts to the market prices, often 50% of the ten-day low bids, or other highly discounted rates, which would allow the holders of those warrants to sell shares into the market at a profit over their discounted price, which could have the effect of depressing the price of the shares in the market. The Company has convertible debt and preferred stock outstanding for which common shares would be required to be issued upon exercise by the holders. As of December 31, 2023, the following shares would be issued: Convertible Promissory Notes 73,476,125,073 Series A Preferred Stock (1) 175,986,864,598 Series B Preferred Stock 2,588,693 Series D Preferred Stock (2) 923,742,574 Series E Preferred Stock (3) 40,465,485,149 290,983,922,753 ___________(1) Holder of the Series A Preferred Stock which is Stephen J. Thomas, is guaranteed 60% of the then outstanding common stock upon conversion. The Company would have to authorize additional shares for this to occur as only 4,500,000,000 shares were authorized as of December 31, 2023. There are 15,000,000,000 shares authorized as of January 17, 2024.(2) Holders of the Series D Preferred Stock may decide after 12 months to convert to common stock @ 75% of the 30 day average market closing price (for previous 30 business days) divided into $5.00. There is also an automatic conversion of the Series D Preferred Stock without consent of holders upon any national exchange listing approval and the registration effectiveness of common stock underlying the conversion rights. The automatic conversion to common from Series D Preferred shall be @ 75% of the 30 day average market closing price (for previous 30 business days) divided into $5.00.(3) Holders of the Series E Preferred Stock may decide after 12 months to convert to common stock @ 75% of the 30 day average market closing price (for previous 30 business days) divided into $5.00. There is also an automatic conversion of the Series E Preferred Stock without consent of holders upon any national exchange listing approval and the registration effectiveness of common stock underlying the conversion rights. The automatic conversion to common from Series E Preferred shall be @ 75% of the 30 day average market closing price (for previous 30 business days) divided into $5.00. Part of the consideration in the acquisition of Aire Fitness was the issuance of 500,000 restricted common shares of the Company vesting and issuable after the common stock reaches at least a $1.00 per share closing price in trading. To date, this has not occurred but may happen in the future upon which the Company will issue 500,000 common shares to the non-controlling interest owners of Aire Fitness.
- Share Price & Shareholder Rights - Risk 3Stock Options
There are currently no stock options outstanding. On October 14, 2017, the Board of Directors and majority stockholders of TPT approved the 2017 TPT Global Tech, Inc. Stock Option and Award Incentive Plan ("the 2017 Plan.") There are 20,000,000 shares of our common stock reserved under the 2017 Plan. On February 1, 2024, by unanimous written consent, the Board of Directors and Majority Shareholder of TPT Global Tech, Inc. (the "Company") approved and adopted an amendment and restatement of the 2024 TPT Global Tech, Inc. Stock Option, Compensation, and Award Incentive Plan (the "Plan") to increase the maximum number of common shares, with a par value of $0.001 ("Common Shares"), available for grant to participants under the Plan to 3,500,000,000 Common Shares. In addition, the Plan was amended to define "Eligible Person" as an Employee, Consultant (Person or Professional Services Company) or Director of the Company, any Parent or any Subsidiary. A company other than a Professional Services Company is NOT eligible and "Issuance for Compensation for Services" shall mean the issuance for valuable and adequate consideration determined by the Board as determined by performance pursuant to an agreement. This Plan amends and supersedes any and all prior Plans.
- Share Price & Shareholder Rights - Risk 4Our directors' liability to us and our shareholders is limited.
Florida Statutes exclude personal liability of our directors and our stockholders for monetary damages for breach of fiduciary duty except in certain specified circumstances. Accordingly, we will have a much more limited right of action against our directors that otherwise would be the case. This provision does not affect the liability of any director under federal or applicable state securities laws.
- Share Price & Shareholder Rights - Risk 5Our Stock prices in the Market may be volatile.
The value of our Common stock following this offering may be highly volatile and could be subject to fluctuations in price in response to various factors, some of which are beyond our control. These factors include: - quarterly variations in our results of operations or those of our competitors; - announcements by us or our competitors of acquisitions, new products, significant contracts, commercial relationships or capital commitments; - disruption to our operations or those of other sources critical to our network operations; - the emergence of new competitors or new technologies; - our ability to develop and market new and enhanced products on a timely basis; - seasonal or other variations in our subscriber base; - commencement of, or our involvement in, litigation; - availability of additional spectrum; - dilutive issuances of our stock or the stock of our subsidiaries, or the incurrence of additional debt; - changes in our board or management; - adoption of new or different accounting standards;- changes in governmental regulations or in the status of our regulatory approvals; - changes in earnings estimates or recommendations by securities analysts; - announcements regarding WiMAX and other technical standards; and - general economic conditions and slow or negative growth of related markets. In addition, the stock market in general, and the market for shares of technology companies in particular, has experienced price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of those companies. We expect the value of our common stock will be subject to such fluctuations.
- Share Price & Shareholder Rights - Risk 6Rule 144 sales of stock in the future may have a depressive effect on our stock price.
All of the outstanding shares of common stock held by our present officers, directors, and affiliate stockholders are "restricted securities" within the meaning of Rule 144 under the Securities Act of 1933, as amended. As restricted Shares, common shares may be resold only pursuant to an effective registration statement or under the requirements of Rule 144 or other applicable exemptions from registration under the Act and as required under applicable state securities laws. Rule 144 provides in essence that a person who has held restricted securities for six months, under certain conditions, sell every three months, in brokerage transactions, a number of shares that does not exceed the greater of 1.0% of a company's outstanding common stock or the average weekly trading volume during the four calendar weeks prior to the sale. There is no limit on the amount of restricted securities that may be sold by a non-affiliate after the owner has held the restricted securities for a period of six months. A sale under Rule 144 or under any other exemption from the Act, if available, or pursuant to subsequent registration of shares of common stock of present stockholders, may have a depressive effect upon the price of the common stock in any market that may develop.
- Share Price & Shareholder Rights - Risk 7Any sales of our common stock, if in significant amounts, are likely to depress the future market price of our securities.
Outside of this offering, convertible debt arrangements and convertible preferred stock that exist, there are no intended sales of common stock.
- Share Price & Shareholder Rights - Risk 8Any new potential investors will suffer a disproportionate risk and there will be immediate dilution of existing investor's investments.
Our present shareholders have acquired their securities at a cost significantly less than that which the investors purchasing hereto will pay for their stock holdings or at which future purchasers in the market may pay. Therefore, any new potential investors will bear most of the risk of loss.
- Share Price & Shareholder Rights - Risk 9We can issue future series of shares of preferred stock without shareholder approval, which could adversely affect the rights of common shareholders.
Our Articles of Incorporation permit our Board of Directors to establish the rights, privileges, preferences and restrictions, including voting rights, of future series of stock and to issue such stock without approval from our shareholders. The rights of holders of common stock may suffer as a result of the rights granted to holders of preferred stock that may be issued in the future. In addition, we could issue preferred stock to prevent a change in control of our Company, depriving common shareholders of an opportunity to sell their stock at a price in excess of the prevailing market price.
- Share Price & Shareholder Rights - Risk 10We will continue to be a reporting company due to the effectiveness of a Form 8-A to be filed concurrent with the acceptance of the NASDAQ listing.
We are subject to the reporting requirements under the Securities and Exchange Act of 1934, Section 13a, due to the effectiveness of previous offerings, pursuant to Section 15d of the Securities Act and we intend to be registered under Section 12(b) concurrent with a NASDAQ listing. As a result, shareholders will have access to the information required to be reported by publicly held companies under the Exchange Act and the regulations thereunder. As a result, we will be subject to legal and accounting expenses that private companies are not subject to and this could affect our ability to generate operating income.
- Share Price & Shareholder Rights - Risk 11We may not successfully meet the NASDAQ Requirements for a listing of our stock, in which case this offering will not occur.
NASDAQ Requirements for listing include the following: a)$4.00 trading price for 30 trading days. Reverse Split of the issued and outstanding shares is necessary in order to meet this criteria, which must be accomplished by the Company, and has not yet been completed. b)$4,000,000 net shareholder's equity to be accomplished through this offering. c)SEC Section 12(b) Registration which has not been achieved. d)At least 100,000 shares of public float. This criteria has been accomplished. e)A minimum of 300+ shareholders. This criteria has been accomplished. f)Total assets of $4,000,000. Will be accomplished through this offering. g)At least two market makers. h)Public float market value of $1,000,000. This criteria has been accomplished. i)Specific corporate governance such as committees and independent Directors in those committees. To be determined prior to effectiveness.
- Share Price & Shareholder Rights - Risk 12We may in the future issue more shares which could cause a loss of control by our present management and current stockholders.
We may issue further shares as consideration for the cash or assets or services out of our authorized but unissued common stock that would, upon issuance, represent a majority of the voting power and equity of our Company. The result of such an issuance would be those new stockholders and management would control our Company, and persons unknown could replace our management at this time. Such an occurrence would result in a greatly reduced percentage of ownership of our Company by our current shareholders, which could present significant risks to investors.
- Share Price & Shareholder Rights - Risk 13Our officers and directors may have conflicts of interests as to corporate opportunities which we may not be able or allowed to participate in.
Presently there is no requirement contained in our Articles of Incorporation, Bylaws, or minutes which requires officers and directors of our business to disclose to us business opportunities which come to their attention. Our officers and directors do, however, have a fiduciary duty of loyalty to us to disclose to us any business opportunities which come to their attention, in their capacity as an officer and/or director or otherwise. Excluded from this duty would be opportunities which the person learns about through his involvement as an officer and director of another company. We have no intention of merging with or acquiring business opportunity from any affiliate or officer or director. (See "Conflicts of Interest" at page 81.)
- Share Price & Shareholder Rights - Risk 14Our common stock will in all likelihood be thinly traded and as a result you may be unable to sell at or near ask prices or at all if you need to liquidate your shares, after any conversion from Preferred Stock.
The shares of our common stock may be thinly-traded on the OTC Market, meaning that the number of persons interested in purchasing our common shares at or near ask prices at any given time may be relatively small or non-existent. This situation is attributable to a number of factors, including the fact that we are a small company which is relatively unknown to stock analysts, stock brokers, institutional investors and others in the investment community that generate or influence sales volume, and that even if we came to the attention of such persons, they tend to be risk-averse and would be reluctant to follow an unproven, early stage company such as ours or purchase or recommend the purchase of any of our Securities until such time as we became more seasoned and viable. As a consequence, there may be periods of several days or more when trading activity in our Securities is minimal or non-existent, as compared to a seasoned issuer which has a large and steady volume of trading activity that will generally support continuous sales without an adverse effect on Securities price. We cannot give you any assurance that a broader or more active public trading market for our common Securities will develop or be sustained, or that any trading levels will be sustained. Due to these conditions, we can give investors no assurance that they will be able to sell their shares at or near ask prices or at all if they need money or otherwise desire to liquidate their securities of our Company.
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