VIQ Solutions (VQSSF) Risk Analysis
Risk Overview Q4, 2022
Source: the company's latest filing for the period ended Dec 31, 2022, filed Apr 03, 2023
Risk Change Over Time
- Share Price & Shareholder Rights - Risk 1Our failure to meet the continuing listing requirements of Nasdaq could result in a delisting of our securities.
On September 27, 2022, the Company received a letter from Nasdaq indicating that the Company was not in compliance with Nasdaq Listing Rule 5550(a)(2) because the closing bid price per share for the Company's common shares had closed below $1.00 for the previous 30 consecutive business days (the "Bid Price Rule"). The Company was given until March 27, 2023, to regain compliance with the Bid Price Rule. On March 28, 2023, the Company was granted an additional 180-day grace period, or until September 25, 2023, to regain compliance with the Bid Price Rule following the Company's notification to Nasdaq that it would seek to implement a reverse stock split, if necessary, to regain compliance with the Bid Price Rule. To regain compliance with the Bid Price Rule and qualify for continued listing on the Nasdaq Capital Market, the minimum bid price per share of the Company's Common Shares must be at least $1.00 for at least 10 consecutive business days on or prior to September 25, 2023. If the Company fails to regain compliance during the additional compliance period, then Nasdaq will notify the Company of its determination to delist the Company's Common Shares, at which point the Company would have an opportunity to appeal the delisting determination to a Nasdaq Listing Qualifications Panel (the "Panel"), but there can be no assurance that the Panel would grant the Company's request for continued listing. If we fail to satisfy the continuing listing requirements of Nasdaq, such as minimum closing bid price requirements, as discussed above, the corporate governance, or stockholders' equity or minimum closing bid price requirements, Nasdaq may take steps to delist our Common Shares. Such a delisting would likely have a negative effect on the price of our Common Shares and would impair our stockholders' ability to sell or purchase our Common Shares. In the event of a delisting, we would likely take actions to restore our compliance with Nasdaq's listing requirements, but we can provide no assurance that any such action taken by us would allow our Common Shares to become listed again, stabilize the market price or improve the liquidity of our securities, prevent our Common Shares from dropping below the Nasdaq minimum bid price requirement or prevent future non-compliance with Nasdaq's listing requirements.
- Debt & Financing - Risk 2The covenants in our credit agreement with Beedie Investments Ltd. ("Beedie") impose restrictions that may limit our operating and financial flexibility.
On January 13, 2023, the Company entered into a senior debt facility (the "Loan") with Beedie, with maximum available funds of $15 million. $12 million of the Loan has been advanced to the Company as an initial advance with an additional $3 million available to the Company to be drawn in subsequent advances in a minimum of $1 million tranches. The credit agreement contains financial covenants, including but not limited to, covenants related to a minimum balance of unrestricted cash and cash equivalents, minimum adjusted monthly EBITDA and maximum total secured debt leverage ratio, and limitations on liens, indebtedness, guarantees and contingent liabilities, loans and investments, distributions, leases, asset sales, share repurchases and mergers and acquisitions. These covenants and limitations may limit our ability to, among other things: - create, incur or assume liens;- make investments and loans;- create, incur, assume or guarantee additional indebtedness;- engage in mergers, acquisitions, consolidations, sale-leasebacks and other similar transactions;- pay dividends, or redeem or repurchase our capital stock;- alter the business that we conduct;- engage in certain transactions with officers, directors and affiliates;- prepay, redeem or purchase other indebtedness;- enter into certain agreements; and - make material changes to accounting and reporting practices. Operating results below current levels or other adverse factors, including increases in interest rates, could result in us being unable to comply with certain covenants contained in the credit agreement with Beedie. If we violate these covenants and are unable to obtain waivers, our debt under the credit agreement with Beedie would be in default, could be accelerated and could permit our lenders to foreclose on our assets securing the debt thereunder. If the indebtedness is accelerated, we may not be able to repay our debt or borrow sufficient funds to refinance it. Even if we are able to obtain new financing, it may not be on commercially reasonable terms or on terms that are acceptable to us. If our debt is in default for any reason, our cash flows, operating results, or financial condition could be materially and adversely affected. In addition, complying with these covenants may also cause us to take actions that may make it more difficult for us to successfully execute our business strategy and compete against companies that are not subject to such restrictions.
Risk Highlights Q4, 2022
Risk Word Cloud
Risk Factors Full Breakdown - Total Risks 30
- Share Price & Shareholder Rights - Risk 1Your ownership interest could be diluted and our stock price could decline when we issue additional shares.
VIQ may issue Common Shares or securities convertible into Common Shares from time to time in connection with a financing, acquisition or otherwise. Any such issuance could result in substantial dilution to existing shareholders and cause the trading price of VIQ's securities to decline.
- Share Price & Shareholder Rights - Risk 2Continued volatility in the market price for our Common Shares could cause investors to lose money.
We have experienced in the past and expect to continue to experience volatility and wide fluctuations in the market price of our Common Shares. Fluctuations in the market price of the Common Shares could cause an investor to lose all or part of its investment in Common Shares. Factors that could cause fluctuations in the trading price of the Common Shares include: - announcements of new offerings, products, services or technologies, commercial relationships, acquisitions or other events by VIQ or its competitors;- price and volume fluctuations in the overall stock market from time to time;- significant volatility in the market price and trading volume of technology companies;- fluctuations in the trading volume of the Common Shares or the size of VIQ's public float;- actual or anticipated changes or fluctuations in VIQ's results of operations;- whether VIQ's results of operations meet or exceed the expectations of securities analysts or investors;- actual or anticipated changes in the expectations of investors or securities analysts;- litigation involving VIQ, its industry, or both;- regulatory developments in Canada and other countries;- general economic conditions and trends;- major catastrophic events;- escrow releases or sales (or expected sales) of large blocks of the Common Shares;- departures of key employees or members of management; or - an adverse impact on VIQ from any of the other risks cited herein.
- Share Price & Shareholder Rights - Risk 3AddedOur failure to meet the continuing listing requirements of Nasdaq could result in a delisting of our securities.
On September 27, 2022, the Company received a letter from Nasdaq indicating that the Company was not in compliance with Nasdaq Listing Rule 5550(a)(2) because the closing bid price per share for the Company's common shares had closed below $1.00 for the previous 30 consecutive business days (the "Bid Price Rule"). The Company was given until March 27, 2023, to regain compliance with the Bid Price Rule. On March 28, 2023, the Company was granted an additional 180-day grace period, or until September 25, 2023, to regain compliance with the Bid Price Rule following the Company's notification to Nasdaq that it would seek to implement a reverse stock split, if necessary, to regain compliance with the Bid Price Rule. To regain compliance with the Bid Price Rule and qualify for continued listing on the Nasdaq Capital Market, the minimum bid price per share of the Company's Common Shares must be at least $1.00 for at least 10 consecutive business days on or prior to September 25, 2023. If the Company fails to regain compliance during the additional compliance period, then Nasdaq will notify the Company of its determination to delist the Company's Common Shares, at which point the Company would have an opportunity to appeal the delisting determination to a Nasdaq Listing Qualifications Panel (the "Panel"), but there can be no assurance that the Panel would grant the Company's request for continued listing. If we fail to satisfy the continuing listing requirements of Nasdaq, such as minimum closing bid price requirements, as discussed above, the corporate governance, or stockholders' equity or minimum closing bid price requirements, Nasdaq may take steps to delist our Common Shares. Such a delisting would likely have a negative effect on the price of our Common Shares and would impair our stockholders' ability to sell or purchase our Common Shares. In the event of a delisting, we would likely take actions to restore our compliance with Nasdaq's listing requirements, but we can provide no assurance that any such action taken by us would allow our Common Shares to become listed again, stabilize the market price or improve the liquidity of our securities, prevent our Common Shares from dropping below the Nasdaq minimum bid price requirement or prevent future non-compliance with Nasdaq's listing requirements.
See a full breakdown of risk according to category and subcategory. The list starts with the category with the most risk. Click on subcategories to read relevant extracts from the most recent report.
