Versus Systems Inc.
For the period ended Dec 31, 2025. Filed Apr 15, 2026.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Apr 15, 2026
VS$0.82-2.6%Stored close · as of Nov 6, 2026
What changed in Risk Factors?
Read the current filingPrevious report: 10-K
Period ended 2024-12-31; filed 2025-03-31.
0001213900-25-026006
Item 1A. RISK FACTORSCurrent report: 10-K
Period ended 2025-12-31; filed 2026-04-15.
0001213900-26-044110
Item 1A. RISK FACTORSThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 121 previous paragraphs and 131 current paragraphs.
100 unchanged; 16 reworded; 14 added; 5 removed; 0 previous and 1 current paragraphs rearranged.
Tables are not compared: 52 previous and 52 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (14)
Current report
We derive a significant portion of our revenue from a limited number of customers, including related parties, and therefore are subject to customer concentration and collectability risks.
Current report
A significant portion of the Company’s revenue is derived from a limited number of customers, including related parties. As a result, the Company’s operating results, financial condition, and cash flows are dependent on the continued engagement and financial stability of these customers.
Current report
The loss of, or a significant reduction in business from, one or more of these customers could have a material adverse effect on the Company’s results of operations and liquidity. In addition, the concentration of revenue with a small number of customers increases the Company’s exposure to credit risk. To the extent that any of these customers experience financial difficulty or delay in payment, the Company’s ability to collect outstanding receivables may be adversely affected, which could impact cash flows and require the Company to record additional allowances for credit losses.
Current report
Management monitors customer creditworthiness and payment trends on an ongoing basis; however, there can be no assurance that such measures will fully mitigate the risks associated with customer concentration. The Company continues to evaluate opportunities to diversify its customer base, although there can be no assurance that these efforts will be successful.
Current report
Since January 2024, we have undertaken a strategic realignment of the business, including changes to our leadership and operating structure to support a more focused growth strategy. The current management team has expanded our presence by establishing a contractor-based sales presence in Brazil, while also working to renew relationships with existing and former customers in the United States. Early progress has been encouraging as we advance the implementation of our strategic initiatives.
Current report
Prior significant reductions in workforce may, however, limit our ability to resume suspended development activities or pursue new initiatives. Rebuilding critical capabilities may require hiring qualified personnel, potentially resulting in additional and unanticipated costs. The loss of a substantial portion of our personnel, including nearly all full-time engineering staff, may impair our ability to continue operations or meet ongoing obligations.
Current report
If these risks materialize, they could have a material adverse impact on our business, financial condition, and results of operations
Current report
We have identified material weaknesses in our internal control over financial reporting. If we are unable to maintain effective internal controls, the accuracy and timeliness of our financial reporting may be materially adversely affected, which could cause the market price of our common stock to decline, lessen investor confidence and harm our business.
Current report
As a public company, we are subject to significant requirements for enhanced financial reporting and internal controls. The process of designing and implementing effective internal controls is a continuous effort that requires us to anticipate and react to changes in our business and the economic and regulatory environments and to expend significant resources to maintain a system of internal controls that is adequate to satisfy our reporting obligations as a public company.
Current report
Our ability to comply with the annual internal control reporting requirements will depend on the effectiveness of our financial reporting and data systems and controls across our company.
Current report
As previously disclosed in the Company’s Form 12b-25 filed on April 1, 2026, in the first quarter of 2026, the Audit Committee of the Company’s Board of Directors conducted an internal investigation and determined that fraudulent activity involving the Company’s former Chief Financial Officer had occurred and that there were material weaknesses in the Company’s internal control over financial reporting as of December 31, 2025. For more information about the fraudulent activity and a promissory note that was executed by the former Chief Financial Officer in connection therewith, please see Notes 11 and 12 to our consolidated financial statements for the year ended December 31, 2025, which disclosure is incorporated herein by reference, and for more information about the material weaknesses in internal control over financial reporting and the Company’s remedial actions, please see Part II, Item 9A. Controls and Procedures of this Form 10-K, which disclosure is incorporated herein by reference.
Current report
There can be no assurance that our remediation efforts will be successful, that additional fraudulent activity has not occurred beyond the isolated activity identified by management and thoroughly investigated and confirmed by the Audit Committee or that the related promissory note will be collected in part or in full. If our remediation efforts are insufficient or are not completed in a timely manner, or if additional material weaknesses in our internal control over financial reporting are identified or occur in the future, our operating results could be harmed and we could fail to meet our financial reporting obligations, or our consolidated financial statements may contain material misstatements and we could be required to restate our financial results, which could materially and adversely affect our business, results of operations and financial condition, restrict our future access to the capital markets, require us to expend significant resources to correct the material weaknesses, subject us to fines, penalties or judgments, reduce the price of our common stock, harm our reputation or otherwise cause a decline in investor confidence in the accuracy and completeness of our reported financial information.
Current report
During 2025, we were previously not in compliance with the annual meeting of shareholders threshold, but subsequently regained compliance within the permitted cure period, including by holding the required annual meeting on June 20, 2025. As a result, we are currently in compliance with applicable Nasdaq listing requirements.
Current report
We are currently not in compliance with Nasdaq’s stockholders’ equity requirement and expect to receive formal notification of non-compliance from Nasdaq shortly after filing this Form 10-K. We will have 45 calendar days from the date the notice is delivered from Nasdaq to provide to Nasdaq a compliance plan for regaining (and maintaining) compliance with the $2.5 million stockholders’ equity threshold. Acceptance of the plan is at Nasdaq’s discretion. If the Company’s plan is accepted, Nasdaq will grant the Company an extension of up to 180 calendar days from the date the Company received the notice of deficiency. However, if the Company does not then timely regain compliance, the stock will be delisted. Delisting from the Nasdaq Capital Market may adversely affect our ability to raise additional financing through the public or private sale of equity securities, may significantly affect the ability of investors to trade our securities and may negatively affect the value and liquidity of our common stock. Delisting also could have other negative results, including the potential loss of employee confidence, the loss of institutional investors or interest in business development opportunities.
Removed paragraphs (5)
Previous report
Since January 2024, we have strategically realigned the focus of the business. To achieve this, we changed our operating team, fostering a new energy and growth mindset to the company. This initiative began in June of 2024 with the addition of the new interim CEO and CFO. The CFO was made permanent later in the year and the then CEO completed their tasks and transitioned to a new position, installing a new and permanent CEO to steer the company into the future. This new management team since taking over, has opened new offices and a sales team in Brazil and has a clear vision to grow the company in this market, whilst renewing existing contracts with existing and prior customers in the US. This is an exciting time for Versus and the company is making headway in its new strategy implementation. Although changes to date have been positive, we may also discover the prior major reductions in workforce and cost cutting measures may make it difficult for us to resume development activities we have suspended or pursue new initiatives, requiring us to hire qualified replacement personnel, which may require us to incur additional and unanticipated costs and expenses. As a result of the loss of services of a significant percentage of our personnel, including nearly all of our full-time engineering staff, we may be unable to continue our operations and meet our ongoing obligations. Any of these unintended consequences will likely have a material adverse impact on our business, financial condition, and results of operations.
Previous report
We are currently not in compliance with the annual meeting of shareholders threshold, however, have been granted an extension until June 30 th 2025 to regain compliance. We shall be hosting an annual meeting by such time, which will correct our non-compliance and enable our continued listing on Nasdaq and the requirement that we should have held a 2024 annual meeting of shareholders.
Previous report
There can be no assurance, however, that we will be able to regain compliance with Nasdaq rules, and even if we do, there can be no assurance that we will be able to maintain compliance with the continued listing requirements or that our common stock will not be delisted in the future. In addition, we may be unable to meet other applicable listing requirements.
Previous report
Holders of our warrants have no rights as a common shareholder until they acquire our common shares.
Previous report
Until you acquire our common shares upon exercise of your warrants, you have no rights as a shareholder in respect of the common shares underlying such warrants. Upon exercise of your warrants, you will be entitled to exercise the rights of a common shareholder only as to matters for which the record date occurs after the exercise date.
Reworded paragraphs (16)
Previous wording
An investment in our securities carries a significant degree of risk. You should carefully consider the following risks, as well as the other information contained in this Annual Report, including our historical consolidated financial statements and related notes included elsewhere in this Annual Report, before you decide to purchase our securities. Any one of these risks and uncertainties has the potential to cause material adverse effects on our business, prospects, financial condition and operating results which could cause actual results to differ materially from any forward-looking statements expressed by us and a significant decrease in the value of our common shares and warrants. Refer to “Cautionary Note Regarding Forward-Looking Statements.”
Current wording
An investment in our securities carries a significant degree of risk. You should carefully consider the following risks, as well as the other information contained in this Annual Report, including our historical consolidated financial statements and related notes included elsewhere in this Annual Report, before you decide to purchase our securities. Any one of these risks and uncertainties has the potential to cause material adverse effects on our business, prospects, financial condition and operating results which could cause actual results to differ materially from any forward-looking statements expressed by us and a significant decrease in the value of our common shares. Refer to “Cautionary Note Regarding Forward-Looking Statements.”
Previous wording
Risks Related to Our Common Shares and Our Warrants
Previous wording
If we are unable to regain compliance with the listing requirements of the Nasdaq Capital Market, our common stock may be delisted from the Nasdaq Capital Market which could have a material adverse effect on our financial condition and could make it difficult for you to sell your shares.
Current wording
If we are not in compliance with the listing requirements of the Nasdaq Capital Market in the future, our common stock may be delisted from the Nasdaq Capital Market which could have a material adverse effect on our financial condition and could make it difficult for you to sell your shares.
Previous wording
In the event we do not regain compliance with those requirements, our securities may be delisted from Nasdaq. Delisting from the Nasdaq Capital Market may adversely affect our ability to raise additional financing through the public or private sale of equity securities, may significantly affect the ability of investors to trade our securities and may negatively affect the value and liquidity of our common stock. Delisting also could have other negative results, including the potential loss of employee confidence, the loss of institutional investors or interest in business development opportunities. If we are delisted from Nasdaq and we are not able to list our common stock on another exchange, our common stock could be quoted on the OTC Bulletin Board or in the “pink sheets.” As a result, we could face significant adverse consequences including, among others:
Current wording
There can be no assurance that we will be able to maintain compliance with all Nasdaq continued listing standards in the future. If we are unable to maintain such compliance, our securities may be delisted from Nasdaq. Delisting from the Nasdaq Capital Market may adversely affect our ability to raise additional financing through the public or private sale of equity securities, may significantly affect the ability of investors to trade our securities and may negatively affect the value and liquidity of our common stock. Delisting also could have other negative results, including the potential loss of employee confidence, the loss of institutional investors or interest in business development opportunities.
Previous wording
Our share price is highly volatile. During the period from January 1, 2023 to December 31, 2024, the closing price of our common shares ranged from a high of $3.95 per share to a low of $1.09 per share. The stock market in general has experienced extreme volatility that has often been unrelated to the operating performance of companies; however, the fluctuation in the price of our common shares is still larger than the stock market in general. As a result of this volatility, you may not be able to sell your common shares at or above the price at which you purchased your common shares and you may lose some or all of your investment. In addition to the general volatility risks of the market, our common shares, we may experience extreme stock price volatility unrelated to our actual or expected operating performance, financial condition or prospects, making it difficult for prospective investors to assess the rapidly changing value of our common shares. As a company with a relatively small public float, our common shares may experience greater stock price volatility, extreme price run-ups, lower trading volume, large spreads in bid and asked prices, and less liquidity than large-capitalization companies. The aspects of the trading in the common shares may be unrelated to our actual or expected operating performance, financial condition or prospects, making it difficult for prospective investors to assess the value of our common shares. Because of the low public float and the absence of any significant trading volume, the public offering price may not reflect the price at which you would be able to sell shares if you want to sell any shares you own or buy shares if you wish to buy share. If the trading volumes of the common shares are low, persons buying or selling in relatively small quantities may easily influence the prices of the common shares. A low volume of trades could also cause the price of the common shares to fluctuate greatly, with large percentage changes in price occurring in any trading day session. Broad market fluctuations and general economic and political conditions may also adversely affect the market price of the common shares. The volatility also could adversely affect our ability to issue additional common shares or other securities and our ability to obtain stock market based financing in the future. No assurance can be given that an active market in our common shares will develop or be sustained.
Current wording
Our share price is highly volatile. During the period from January 1, 2025 to December 31, 2025, the closing price of our common shares ranged from a high of $2.81 per share to a low of $1.21 per share. The stock market in general has experienced extreme volatility that has often been unrelated to the operating performance of companies; however, the fluctuation in the price of our common shares is still larger than the stock market in general. As a result of this volatility, you may not be able to sell your common shares at or above the price at which you purchased your common shares and you may lose some or all of your investment. In addition to the general volatility risks of the market, our common shares, we may experience extreme stock price volatility unrelated to our actual or expected operating performance, financial condition or prospects, making it difficult for prospective investors to assess the rapidly changing value of our common shares. As a company with a relatively small public float, our common shares may experience greater stock price volatility, extreme price run-ups, lower trading volume, large spreads in bid and asked prices, and less liquidity than large-capitalization companies. The aspects of the trading in the common shares may be unrelated to our actual or expected operating performance, financial condition or prospects, making it difficult for prospective investors to assess the value of our common shares. Because of the low public float and the absence of any significant trading volume, the public offering price may not reflect the price at which you would be able to sell shares if you want to sell any shares you own or buy shares if you wish to buy share. If the trading volumes of the common shares are low, persons buying or selling in relatively small quantities may easily influence the prices of the common shares. A low volume of trades could also cause the price of the common shares to fluctuate greatly, with large percentage changes in price occurring in any trading day session. Broad market fluctuations and general economic and political conditions may also adversely affect the market price of the common shares. The volatility also could adversely affect our ability to issue additional common shares or other securities and our ability to obtain stock market based financing in the future. No assurance can be given that an active market in our common shares will develop or be sustained.
Previous wording
The market prices of our common shares and Unit A Warrants are likely to be highly volatile because of several factors, including a limited public float.
Current wording
The market prices of our common shares are likely to be highly volatile because of several factors, including a limited public float.
Previous wording
The market prices of our common shares and Unit A Warrants have experienced significant price and volume fluctuations and the prices of such securities are likely to be highly volatile in the future. You may not be able to resell our common shares or Unit A Warrants following periods of volatility because of the market’s adverse reaction to volatility.
Current wording
The market prices of our common shares have experienced significant price and volume fluctuations and the prices of such securities are likely to be highly volatile in the future. You may not be able to resell our common shares following periods of volatility because of the market’s adverse reaction to volatility.
Previous wording
Any of these factors could have a significant and adverse impact on the market prices of our common shares and/or our Unit A Warrants. In addition, the stock market in general has at times experienced extreme volatility and rapid decline that has often been unrelated or disproportionate to the operating performance of particular companies. These broad market fluctuations may adversely affect the trading prices of our common shares and/or Unit A Warrants, regardless of our actual operating performance.
Current wording
Any of these factors could have a significant and adverse impact on the market prices of our common shares. In addition, the stock market in general has at times experienced extreme volatility and rapid decline that has often been unrelated or disproportionate to the operating performance of particular companies. These broad market fluctuations may adversely affect the trading prices of our common shares, regardless of our actual operating performance.
Previous wording
Our common shares have in the past been a “penny stock” under SEC rules, and our Unit A Warrants may be subject to the “penny stock” rules in the future. It may be more difficult to resell securities classified as “penny stock.”
Current wording
Our common shares have in the past been a “penny stock” under SEC rules. It may be more difficult to resell securities classified as “penny stock.”
Previous wording
In the past, our common shares were a “penny stock” under applicable SEC rules (generally defined as non-exchange traded stock with a per-share price below US$5.00). While our common shares and Unit A Warrants are not currently considered “penny stock” because they are listed on The Nasdaq Capital Market, if we are unable to maintain that listing and our common shares and/or our Unit A Warrants are no longer listed on The Nasdaq Capital Market, unless we maintain a per-share price above $5.00, our common shares and/or Unit A Warrants will be considered “penny stock.” These rules impose additional sales practice requirements on broker-dealers that recommend the purchase or sale of penny stocks to persons other than those who qualify as “established customers” or “accredited investors.” For example, broker-dealers must determine the appropriateness for non-qualifying persons of investments in penny stocks. Broker-dealers must also provide, prior to a transaction in a penny stock not otherwise exempt from the rules, a standardized risk disclosure document that provides information about penny stocks and the risks in the penny stock market. The broker-dealer also must provide the customer with current bid and offer quotations for the penny stock, disclose the compensation of the broker-dealer and its salesperson in the transaction, furnish monthly account statements showing the market value of each penny stock held in the customer’s account, provide a special written determination that the penny stock is a suitable investment for the purchaser, and receive the purchaser’s written agreement to the transaction.
Current wording
In the past, our common shares were a “penny stock” under applicable SEC rules (generally defined as non-exchange traded stock with a per-share price below US$5.00). While our common shares are not currently considered “penny stock” because they are listed on The Nasdaq Capital Market, if we are unable to maintain that listing and our common shares are no longer listed on The Nasdaq Capital Market, unless we maintain a per-share price above $5.00, our common shares will be considered “penny stock.” These rules impose additional sales practice requirements on broker-dealers that recommend the purchase or sale of penny stocks to persons other than those who qualify as “established customers” or “accredited investors.” For example, broker-dealers must determine the appropriateness for non-qualifying persons of investments in penny stocks. Broker-dealers must also provide, prior to a transaction in a penny stock not otherwise exempt from the rules, a standardized risk disclosure document that provides information about penny stocks and the risks in the penny stock market. The broker-dealer also must provide the customer with current bid and offer quotations for the penny stock, disclose the compensation of the broker-dealer and its salesperson in the transaction, furnish monthly account statements showing the market value of each penny stock held in the customer’s account, provide a special written determination that the penny stock is a suitable investment for the purchaser, and receive the purchaser’s written agreement to the transaction.
Previous wording
These requirements may have the effect of reducing the level of trading activity, if any, in the secondary market for a security that becomes subject to the penny stock rules. The additional burdens imposed upon broker dealers by such requirements may discourage broker-dealers from effecting transactions in our securities, which could severely limit the market price and liquidity of our securities. These requirements may restrict the ability of broker-dealers to sell our common shares or our warrants and may affect your ability to resell our common shares and our Unit A Warrants.
Current wording
These requirements may have the effect of reducing the level of trading activity, if any, in the secondary market for a security that becomes subject to the penny stock rules. The additional burdens imposed upon broker dealers by such requirements may discourage broker-dealers from effecting transactions in our securities, which could severely limit the market price and liquidity of our securities. These requirements may restrict the ability of broker-dealers to sell our common shares and may affect your ability to resell our common shares.
Previous wording
For these reasons, penny stocks may have a limited market and, consequently, limited liquidity. We can give no assurance at what time, if ever, our common shares or our Unit A Warrants will not be classified as a “penny stock” in the future.
Current wording
For these reasons, penny stocks may have a limited market and, consequently, limited liquidity. We can give no assurance at what time, if ever, our common shares will not be classified as a “penny stock” in the future.
Previous wording
If the benefits of any proposed acquisition do not meet the expectations of investors, shareholders or financial analysts, the market price of our common shares and/or Unit A Warrants may decline.
Current wording
If the benefits of any proposed acquisition do not meet the expectations of investors, shareholders or financial analysts, the market price of our common shares could decline.
Previous wording
If the benefits of any proposed acquisition do not meet the expectations of investors or securities analysts, the market price of our common shares and/or Unit A Warrants prior to the closing of the proposed acquisition may decline. The market values of our common shares and/or Unit A Warrants at the time of the proposed acquisition may vary significantly from their prices on the date the acquisition target was identified.
Current wording
If the benefits of any proposed acquisition do not meet the expectations of investors or securities analysts, the market price of our common shares prior to the closing of the proposed acquisition may decline. The market values of our common shares at the time of the proposed acquisition may vary significantly from their prices on the date the acquisition target was identified.
Previous wording
In addition, broad market and industry factors may materially harm the market price of our common shares and/or Unit A Warrants irrespective of our operating performance. The stock market in general has experienced price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of the companies affected. The trading prices and valuations of these stocks, and of our securities, may not be predictable. A loss of investor confidence in the market for retail stocks or the stocks of other companies which investors perceive to be similar to us could depress the price of our common shares and/or Unit A Warrants regardless of our business, prospects, financial conditions or results of operations. A decline in the market price of our securities also could adversely affect our ability to issue additional securities and our ability to obtain additional financing in the future.
Current wording
In addition, broad market and industry factors may materially harm the market price of our common irrespective of our operating performance. The stock market in general has experienced price and volume fluctuations that have often been unrelated or disproportionate to the operating performance of the companies affected. The trading prices and valuations of these stocks, and of our securities, may not be predictable. A loss of investor confidence in the market for retail stocks or the stocks of other companies which investors perceive to be similar to us could depress the price of our common shares regardless of our business, prospects, financial conditions or results of operations. A decline in the market price of our securities also could adversely affect our ability to issue additional securities and our ability to obtain additional financing in the future.
Previous wording
From time to time, certain of our shareholders may be eligible to sell all or some of their common shares by means of ordinary brokerage transactions in the open market pursuant to Rule 144 promulgated under the Securities Act of 1933, as amended, or the Securities Act, subject to certain limitations. In general, pursuant to Rule 144, non-affiliate shareholders may sell freely after six months, subject only to the current public information requirement. Affiliates may sell after six months, subject to the Rule 144 volume, manner of sale (for equity securities), current public information, and notice requirements. Of the approximately 4,901,677 common shares outstanding as of December 31, 2024, approximately 3,176,372 shares were tradable without restriction. Given the limited trading of our common shares, resale of even a small number of our common shares pursuant to Rule 144 or an effective registration statement may adversely affect the market price of our common shares.
Current wording
From time to time, certain of our shareholders may be eligible to sell all or some of their common shares by means of ordinary brokerage transactions in the open market pursuant to Rule 144 promulgated under the Securities Act of 1933, as amended, or the Securities Act, subject to certain limitations. In general, pursuant to Rule 144, non-affiliate shareholders may sell freely after six months, subject only to the current public information requirement. Affiliates may sell after six months, subject to the Rule 144 volume, manner of sale (for equity securities), current public information, and notice requirements. Of the approximately 4,901,677 common shares outstanding as of December 31, 2025, approximately 1,725,963 shares were tradable without restriction. Given the limited trading of our common shares, resale of even a small number of our common shares pursuant to Rule 144 or an effective registration statement may adversely affect the market price of our common shares.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
If we are delisted from Nasdaq and we are not able to list our common stock on another exchange, our common stock could be quoted on the OTC Bulletin Board or in the “pink sheets.” As a result, we could face significant adverse consequences including, among others: