Hexagon Purus SPAC Presentation Deck
Risk factors (4/4)
Future sales of the Company's shares by its larger shareholder or any of its primary insiders may depress the price of the Company's shares: The market price of the Company's shares could decline as a result of sales of a large number of shares in the market by its major shareholders
after the Issue or the perception that these sales could occur, or any sale of shares by any of the Company's primary insiders from time to time. These sales, or the possibility that these sales may occur, might also make it more difficult for the Company to sell equity securities in the future at a time
and at a price it deems appropriate.
RISKS RELATED TO LAWS AND REGULATIONS
TM
HEXAGON
PURUS
Risks related to litigation, disputes and claims: The Company may in the future be involved from time to time in litigation and disputes. The operating hazards inherent in the Company's business may expose the Company to, amongst other things, litigation, including personal injury litigation,
intellectual property litigation, contractual litigation, environmental litigation, tax or securities litigation, as well as other litigation that arises in the ordinary course of business. No assurance can be given that the Company is not exposed to claims, litigation and compliance risks, which could expose
the Company to losses and liabilities. Such claims, disputes and proceedings are subject to uncertainty, and their outcomes are often difficult to predict. Adverse regulatory action or judgment in litigation could result in sanctions of various types for the Company, including, but not limited to, the
payment of fines, damages or other amounts, the invalidation of contracts, restrictions or limitations on the Company's operations, any of which could have a material adverse effect on the Company's business, financial condition, results of operations and/or prospects.
Changes in tax laws of any jurisdiction in which the Company operates, and/or any failure to comply with applicable tax legislation may have a material adverse effect for the Company: The Company is and will be subject to prevailing tax legislation, treaties and regulations in the
jurisdictions in which it operates, and the interpretation and enforcement thereof. The Company's income tax expenses are based upon its interpretation of the tax laws in effect at the time that the expense is incurred. If applicable laws, treaties or regulations change, or if the Company's
interpretation of the tax laws is at variance with the interpretation of the same tax laws by tax authorities, this could have a material adverse effect on the Company's business, results of operations or financial condition. If any tax authority successfully challenges the Company's operational
structure, pricing policies or if taxing authorities do not agree with the Company's assessment of the effects of applicable laws, treaties and regulations, or the Company loses a material tax dispute in any country, or any tax challenge of the Company's tax payments is successful, the Company's
effective tax rate on its earnings could increase substantially and the Company's business, earnings and cash flows from operations and financial condition could be materially and adversely affected.
Risks associated with changes to accounting rules or regulations: Changes to existing accounting rules or regulations may impact the Company's future profit and loss or cause the perception that the Company is more highly leveraged. New accounting rules or regulations and varying
interpretations of existing accounting rules or regulations may be adopted in the future and could adversely affect the Company's financial position and results of operations.
Risk relating to GDPR: The EU General Data Protection Regulation (GDPR) imposes a number of obligations of the Company, including risks related to use of cookies and transfer of personal data outside the EU/EEA. Given the scope and complexity of GDPR regulation, there is a risk that the
measures imposed by GDPR are not implemented correctly or that there may be partial non-compliance with the new procedures, which could result in significant administrative and monetary sanctions as well as reputational damage.
RISKS RELATED TO THE GROUP'S FINANCIAL POSITION AND LIQUIDITY
Adequate funding may not be available in the future: To the extent the Company does not generate sufficient cash from operations to fund its existing and future business plans, the Company may need to raise additional funds through public or private debt or equity financing to execute the
Company's growth strategy and to fund capital expenditures. Adequate sources of capital funding might not be available when needed or may only be available on unfavorable terms. If funding is insufficient at any time in the future, the Company may be unable to, inter alia, fund acquisitions, take
advantage of business opportunities or respond to competitive pressures, any of which could adversely impact the Company's financial condition and results of operations.
Future debt arrangements could limit the Company's liquidity and flexibility and the Group may be unable to generate sufficient cash flow to satisfy its debt obligation: Any future debt arrangements could limit the Company's liquidity and flexibility in obtaining additional financing
and/or in pursuing other business opportunities. Further, the Company's future ability to obtain bank financing or to access the capital markets for any future debt or equity offerings may be limited by the Company's financial condition at the time of such financing or offering, as well as by adverse
market conditions related to, for example, general economic conditions and contingencies and uncertainties that are beyond the Company's control. Failure by the Company to obtain funds for future capital expenditures could impact the Company's results, financial condition, cash flows and
prospects. The Group's future cash flow may be insufficient to meet its debt obligations and commitments. Any insufficiency could negatively impact the Group's business. A range of economic, competitive, business and industry factors will affect the Group's future financial performance and, as a
result, an inability to generate sufficient cash flow to satisfy its debt obligations, or to obtain alternative financing, could materially and adversely affect the Group's business, financial condition, results of operations, and prospects.
Risks related to contractual default by counterparties: The ability of each counterparty to perform its obligations under a contract with the Company will depend on a number of factors that are beyond the Company's control including, for example, factors such as: i) general economic
conditions; ii) the condition of the industry to which the counterparty is exposed; and iii) the overall financial condition of the counterparty. Should a counterparty fail to honor its obligations under its agreements with the Company, this could impair the Company's liquidity and cause significant
losses, which in turn could have a material adverse effect on the Company's business, results of operations, cash flows, financial condition and/or prospects.
Interest rate risk: The Group could be exposed to interest rate risk from its financing activities. Some of the Group's potential future interest-bearing liabilities may have variable interest rates, which means that the Group may be affected by changes in interest rates which exposes the Group to
volatility in future interest payment amounts.
Currency risk: As the Group has production and sales in different countries with different functional currencies, it is exposed to currency risk associated with movements of the Norwegian krone against other currencies while the Group's presentation currency is NOK. The most important foreign
currencies to the Group is currently the US Dollar and Euro and changes in currency rates could have a negative impact on the Company's competitive position, and have a significant effect on the Company's reported results. The carrying amount of the Group's net investments in foreign
companies fluctuates as the Norwegian krone moves against other relevant currencies. The Group's profit after tax is also affected by currency movements, as the results of foreign companies are translated to the Norwegian currency using the weighted average exchange rate for the period.
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