Risks Specific to Modbook
Investment in the Company is suitable only for individuals who are financially able to withstand total loss of their investment. While the Company has developed a business plan it believes in good faith has a reasonable chance of success, the projections made by the Company are ultimately speculative and involve the possibility of a total loss of investment, due to any number of considerations.
The Company is relying on Just-in-Time manufacturing to efficiently manage its cash flow and avoid tying up monies in production parts that could become obsolete when third parties whose products the Company relies upon are updating their products. The Company is targeting completed products to remain less than 8 days in inventory and is accordingly planning manufacturing based on its sales forecast. This may cause the Company to lose out on sales due to a potential inability to sufficiently scale manufacturing to timely respond to unexpected demand or fill large unit orders. This also prevents the Company from engaging with certain sales and distribution partners that would require the Company to carry inventory at such partner, which could negatively affect the Company's ability to penetrate certain target markets and achieve its goals in such markets.
The Company's products require for their basic function certain third party products, including but not limited to certain models of the MacBook Pro product line from Apple Inc. Such third party products undergo changes from time to time, in which case the Company's products may no longer function with such changed third party products. In such an event, the Company will have to invest in research and development to restore its products' function and interoperability with the changed third party products. Such required restoration may cause delays in product availability or even require the termination of products where such restoration is not feasible, either which in turn may cause a material adverse effect on the Company’s results of operations and financial condition, and the Company may not be able to achieve its goals.
The Company's core product line are macOS-based tablet computers. This type of computer is not currently offered by Apple Inc. and Company's management is satisfied that this situation will not change in the foreseeable future. However, sales of the Company's current core product line would be subjected to material adverse effects should Apple Inc. launch a competing macOS-based tablet computer.
The Company is comprised of a small but highly skilled team. The loss or death, especially of Andreas Haas (CEO / Lead Engineer) could severely impair the company’s ability to implement their plans.
The Company could be harmed in the event of the death or disability of Founder Andreas Haas. Likewise, key team members could leave or become unable to serve, decreasing the Company’s ability to achieve its goals. The Company has engaged global resources for some of its components. Political risks, natural disasters, communication outages and other factors can make team members or key suppliers unavailable or otherwise impact our ability to keep operating at projected efficiencies.
In order to successfully execute its business plan, the Company is dependent on its founder, management, and sponsors in combination with attracting, recruiting, developing and retaining qualified personnel to meet its growth goals. Retaining qualified personnel or locating and hiring replacements, if any, could be costly and may require the Company to grant equity rewards or incentive compensation, which could have a materially adverse effect on the Company’s financial results and any potential investment. Any loss of any such persons through untimely death, unwillingness to continue or other unidentified conditions, could have a materially adverse effect on the company and its business.
The Company will allot some portion of the proceeds from the offering for unspecified working capital. The proceeds from the offering could be used by the Company in the ways management deems most effective in meeting the Company’s goals. This means that although the Company definitely has plans for the proceeds (focused on marketing, sales, product launch, and expanding product lines), the Company will ultimately have the discretion to allocate the proceeds as it sees fit and the Company has chosen not to limit the Company’s use of the funds to specific areas that investors could evaluate. A use of proceeds that does not further the Company’s business and goals could harm the Company and its operations, and ultimately cause an investor to lose all or portion of his or her investment. Accordingly, any portion of the proceeds from this offering could be used for the purpose that the Company deems to be in its best interest in order to address new opportunities and changed or unforeseen circumstances. As a result, the Company’s success will be substantially dependent upon its discretion and judgment with respect to application and allocation of such portion of the proceeds in the manner that the investors do not agree and investor may have no recourse.
Revenue projections for the Company may change or be diminished. The Company’s success depends mainly on its ability to collect revenue from the sale of its to be newly launched product and other developing product lines. The company may generate but retain some or all of the earnings for the development and expansion of its business and product lines accordingly, and choose not to make distributions to the shareholders. If the Company does not generate enough revenue, its business, financial condition, and operating results will be materially adversely impacted.
Fluctuations and uncertainty in the broader economic climate could have an adverse effect on consumer and business confidence, limiting non-critical expenditures and affecting the Company’s revenue. It is possible that increasing financial pressures and other economic factors (such as rising healthcare costs, declining incomes, increasing unemployment, tax increases and projected rising interest rates) may limit the income required to purchase high-performance technology and may adversely affect both business and customers’ confidence and willingness to spend. Any of such events or occurrences could have a material adverse effect on the Company’s financial results and on the investor's investment.
An increase in the cost of components and/or raw materials could affect the Company’s profitability. Commodity and other price changes may result in unexpected increases in the cost of specific components, raw materials, glass and other materials used by the Company. The Company may also be adversely affected by shortages of components or raw materials. In addition, energy costs increases could result in higher transportation, freight and other operating costs. The Company may not be able to increase its prices to offset these increased costs without suffering reduced volumes, sales and operating profit, and this could have an adverse effect on the investor's investment.
Even if the Company reaches or exceeds its revenue goals, and the investor wants immediate access to the then net worth of the investment, the investor may need to wait until a liquidity event, and there are no guarantees one will occur.
Most markets, including the market for technology companies, are not predictable. While we may be able to sell the company for its technology, business model, intellectual properties, team or other factors, there is no guarantee that it will become profitable or that it can or will be sold. Even if a sale does occur, there is no guarantee that investor returns will be positive, nor sold for an amount that allows the investor to recoup their investment, or make a profit.
An investor may not realize a return on their investment and could lose their investment. Investors should carefully review this Agreement and these Risk Factors and consult with their attorneys, tax advisors, and/or business advisors prior to participating in this offering.