{"url_path":"/sec/atln/10-q/2026/item-1a","section_key":"item-1a","section_title":"Item 1A Risk Factors","topic":"sec","document":{"doc_type":"10-Q","doc_date":"2026-06-22","source_url":"https://www.sec.gov/Archives/edgar/data/1605888/0001605888-26-000025-index.html","accession_number":"0001605888-26-000025","cik":"0001605888","ticker":"ATLN","issuer_name":"CIRCLE8 GROUP INC","edgar_url":"https://www.sec.gov/Archives/edgar/data/1605888/0001605888-26-000025-index.html","primary_entity_key":"0001605888","primary_entity_name":"ATLANTIC INTERNATIONAL CORP."},"word_count":1698,"has_tables":true,"body_markdown":"Item 1a. Risk Factors\n\nSPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS\n\nThis Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995. In some cases, you can identify forward-looking statements by the words “may,” “might,” “will,” “could,” “would,” “should,” “expect,” “intend,” “plan,” “objective,” “anticipate,” “believe,” “estimate,” “predict,” “project,” “potential,” “continue” and “ongoing,” or the negative of these terms, or other comparable terminology intended to identify statements about the future, although not all forward-looking statements contain these words. These statements relate to future events or our future financial performance or condition and involve known and unknown risks, uncertainties and other factors that could cause our actual results, levels of activity, performance or achievement to differ materially from results expressed or implied in this Quarterly Report on Form 10-Q. These forward-looking statements include, but are not limited to, statements about:\n\n•our expectations regarding the market size and growth potential for our business;\n\n•the implementation of our strategic plans, including strategy for our business, acquisitions and related financing;\n\n•the ability of Lyneer and IDC to meet the terms and conditions of their joint and several debt obligations;\n\n•our ability to maintain and establish future collaborations and strategic clients;\n\n•the rate and degree of market acceptance of our services;\n\n•our ability to meet the continued listing requirements of the Nasdaq Stock Market;\n\n•our ability to generate sustained revenue or achieve profitability;\n\n•the pricing and expected gross margin for our services;\n\n•the expected benefits and synergies of the Acquisition of Circle8;\n\n•the expected financial condition, results of operations, earnings outlook and prospects of our Company, Lyneer and the combined company, including any projections of sales, earnings, revenue, margins or other financial items;\n\n•the ability of the new management team to execute our business plan;\n\n•our business strategies and goals;\n\n•any statements regarding the plans, strategies and objectives of management for future operations;\n\n•any statements regarding future economic conditions or performance;\n\n•all assumptions, expectations, predictions, intentions or beliefs about future events;\n\n•changes in applicable laws, regulations or permits affecting Atlantic, Lyneer or Circle8’s operations or the industries in which each appears;\n\n•general economic and geopolitical conditions;\n\n•our competitive position; and\n\n•our estimates of our expenses, ongoing losses, future revenue, capital requirements and our needs for, or ability to obtain, additional financing as necessary.\n\nThe forward-looking statements contained in this Quarterly Report on Form 10-Q and the documents incorporated herein by reference are based on our current expectations and beliefs concerning future developments and their potential effects on our business. There can be no assurance that future developments affecting our business will be those that we have anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control) or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to, those factors described in this Section and under similar headings in the documents that are incorporated by reference herein. Moreover, we operate in a very competitive and rapidly changing environment.\n\n76\n\nNew risks and uncertainties emerge from time to time, and it is not possible for us to predict all such risk factors, nor can we assess the effect of all such risk factors on our business or the extent to which any factor or combination of factors may cause actual results to differ materially from those contained in any forward-looking statements. Should one or more of these risks or uncertainties materialize, or should any of the assumptions prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements.\n\nThe forward-looking statements made by us in this Quarterly Report on Form 10-Q and the documents incorporated herein by reference speak only as of the date of such statement. Except to the extent required under the federal securities laws and rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”), we disclaim any obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events. In light of these risks and uncertainties, there is no assurance that the events or results suggested by the forward-looking statements will in fact occur, and you should not place undue reliance on these forward-looking statements.\n\nAlthough we undertake no obligation to revise or update any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law, you are advised to consult any additional disclosures we make in the documents that we file with the SEC.\n\nOther than the litigation set forth in Item 1. Legal Proceedings there have been no material changes to the Risk Factors included in the Company’s Annual Report on Form 10-K filed with the SEC on April 15,2026 to the date of this filing. A summary of those risk factors is outlined below.\n\nRISK FACTOR SUMMARY\n\nOur business is subject to numerous risks and uncertainties. These risks include, but are not limited to the following:\n\nRisks Related to Lyneer’s Business\n\n•Lyneer has a significant amount of debt obligations and its failure to restructure or pay such obligations when due could have a material adverse impact on Lyneer’s financial condition and long-term viability. Furthermore, Lyneer is in default under its principal credit facilities and outstanding promissory notes and any future defaults by Lyneer under its credit facilities could also have a material adverse impact on Lyneer’s financial condition and long-term viability.\n\n•Lyneer operates in an intensely competitive and rapidly changing business environment, and there is a substantial risk that its services could become obsolete or uncompetitive.\n\n•Lyneer is a party to debt instruments which contain covenants that could limit its financing options and liquidity position, which would limit its ability to grow its business. Lyneer’s failure to comply with the restrictions in these debt instruments could result in events of default, which, if not cured or waived, could result in Lyneer being required to repay these borrowings before their due date.\n\n•Lyneer’s customers can terminate their agreements at any time, making Lyneer particularly vulnerable to a significant decrease in revenue within a short period of time that could be difficult to quickly replace.\n\n•The Company and Lyneer are parties to litigation with their former lender that could force the Company to repay indebtedness to its former lender which would have a material adverse effect on the Company.\n\n•The Company’s audited financial statements have been prepared with a going concern qualification.\n\nRisks Related to Circle8’s Business\n\n•As a staffing company, Circle8 is prone to cash flow imbalances. If it is unable to satisfy those needs from cash generated from its operations or borrowings under its debt instruments, upon mutual agreement we will be required to fund such shortfall.\n\n•Circle8’s clients come from a variety of enterprises and their needs may change rapidly as their businesses and industries evolve.\n\n•The worldwide employment services industry is highly competitive with limited barriers to entry into many markets, which could limit our ability to maintain or increase our market share or profitability.\n\n•Circle8’s international operations subject us to numerous risks outside of our control, including risks arising from political unrest, military conflicts, natural disasters, severe weather conditions, and global health emergencies.\n\n•Foreign currency fluctuations, changes in tax rates, adoption of new international tax legislation or tax audits that could result in additional income tax liabilities may have a material adverse effect on our operating results.\n\n77\n\n•New laws and government regulations, including labor and employment laws, privacy laws, antibribery and corruption laws may result in prohibition or restriction of certain types of employment services or the imposition of additional licensing or tax requirements which may negative affect our future earnings.\n\nGeneral Risks Affecting Our Combined Business\n\n•We have been and may be exposed to employment-related claims and losses, including class action lawsuits that could have a material adverse effect on our business.\n\n•Our growth strategy and our expansion and acquisition strategy may not be executed effectively. Following the acquisition of Circle8, we have not reached any definitive agreement with any acquisition targets, and we cannot assure you that we will consummate any future acquisition on favorable terms or at all.\n\n•Cybersecurity risks may impact our business, and any improper disclosure or loss of sensitive or confidential company, employee, associate or customer data could damage our business operations and expose us to liability, which would cause our business and reputation to suffer.\n\n•We are subject to certain U.S. and foreign anti-corruption, anti-money laundering, export control, sanctions, and other trade laws and regulations. We can face serious consequences for violations.\n\n•Each of Atlantic and Circle8 have incurred significant costs in connection with the Acquisition. The Purchase Price under the Acquisition Agreement is not adjustable based on the market price of Atlantic Common Stock, so the Share consideration received by Axiom may have a greater or lesser value than at the time the Acquisition Agreement was signed.\n\nRisks Related to Ownership of Our Common Stock\n\n•The market price of our Common Stock may be highly volatile, and you could lose all or part of your investment.\n\n•We may be subject to securities litigation, which is expensive and could divert our management’s attention.\n\n•We are an “emerging growth company” and the reduced disclosure requirements applicable to emerging growth companies could make our common stock less attractive to investors.\n\n•Anti-takeover provisions in our charter documents and under Delaware law could make an acquisition of us, which may be beneficial to our stockholders, more difficult and may prevent attempts by our stockholders to replace or remove our current management and limit the market price of our common stock.\n\n•We do not anticipate paying any cash dividends on our common stock in the foreseeable future and, as a result, capital appreciation, if any, of our common stock will be your sole source of gain for the foreseeable future.\n\n78"}