Big Sky Industrial (BSIN) risk factors, FY2025 10-K

Risks Related to the Industrial Gas, Oil and Natural Gas Industries and Our Business

1. 01We may need additional capital to complete future acquisitions, conduct our operations, and fund our business, and our ability to obtain the necessary funding is uncertain
2. 02If this were to happen, we may be forced to scale back our business plan which could result in the value of our outstanding securities declining in value
3. 03$ 80.73 $ 55.44 $ 9.86 $ 2.65
4. 04global economic conditions
5. 05The Company ’ s operations have in the past been, and could in the future be, disrupted by natural or human causes beyond its control
6. 06The future value and resources associated with our industrial gas development are unknown and the Company may never realize the value of any resources
7. 07The Company ’ s industrial gas properties are in the exploration stage; such properties may never yield commercial quantities of industrial gas; and the Company may not be able to commercially extract them, if present
8. 08Our industrial gas, oil, natural gas and NGL operations are subject to environmental, legislative and regulatory initiatives that can materially adversely affect the timing and cost of operations and the demand for industrial gas, crude oil, natural gas, and NGLs
9. 09restricting or even prohibiting water use based upon availability, impacts or other factors
10. 10Our industrial gas operations will require us to obtain licenses and permits which may not be obtained, may be delayed, or may limit our ability to undertake exploration, production and post gas processing injection activities
11. 11Our industrial gas operations are subject to risks and hazards which may not be covered by insurance
12. 12We face risks associated with our ability to locate and commercially extract industrial gas40% rewritten
13. 13The construction of our planned processing facility, gathering and transportation system, and power infrastructure is subject to significant risks that could increase costs, delay operations, or prevent completionNew
14. 14The Company has never had any industrial gas producing properties and such properties may not result in profitable production
15. 15The Company faces industrial gas drilling risks
16. 16The Company may be unable or unwilling to develop commercially viable industrial gas operations
17. 17There are numerous risks associated with estimating industrial gas resources
18. 18The Company faces risks associated with its current lack of distribution agreements
19. 19The Company ’ s industrial gas production and margins thereon, if any, will be subject to changing prices
20. 20The Company ’ s industrial gas operations will be subject to gas processing and transportation costs and risks
21. 21The Company ’ s industrial gas exploration and production activities will be subject to technological risks
22. 22Our business and operations were previously adversely affected by the COVID-19 pandemic and may be adversely affected by other similar outbreaks
23. 23Declining general economic, business or industry conditions have, and will continue to have, a material adverse effect on our results of operations, liquidity, and financial condition, and are expected to continue having a material adverse effect for the foreseeable future
24. 24The Company ’ s operations could be disrupted by natural or human causes beyond its control
25. 25Economic uncertainty may affect our access to capital and/or increase the costs of such capital
26. 26The development of industrial gas, oil and natural gas properties involves substantial risks that may result in a total loss of investment
27. 27unavailability or high cost of equipment, field services and labor
28. 28In addition, initial 24-hour or other limited-duration production rates announced regarding our industrial gas, oil and natural gas properties are not necessarily indicative of future production rates
29. 29Oil price differential and oil price differentials in other properties in Wyoming and Montana could have adverse impacts on our revenue
30. 30Unanticipated costs could require new capital that may not be available
31. 31Competition may limit our opportunities in the industrial gas, oil and natural gas business
32. 32Successful exploitation of shale formations is subject to risks related to horizontal drilling and completion techniques
33. 33If our access to oil and natural gas markets is restricted, it could negatively impact our production and revenues. Securing access to takeaway capacity may be particularly difficult in less developed areas of Montana and Wyoming
34. 34If we are unable to replace reserves, we will not be able to sustain production
35. 35Substantially all of our oil and natural gas interests are subject to joint operating and similar agreements. Some of these agreements include payment provisions that are complex and subject to different interpretations and/or can be erroneously applied in particular situations
36. 36Our estimated reserves are based on many assumptions that may turn out to be inaccurate. Any material inaccuracies in these reserve estimates or the relevant underlying assumptions will materially affect the quantity and present value of our reserves
37. 37Our hedging activities have in the past and may in the future prevent us from benefiting fully from increases in oil and gas prices and may expose us to other risks, including counterparty risk
38. 38the steps we take to monitor our derivative financial instruments do not detect and prevent transactions that are inconsistent with our risk management strategies
39. 39Our producing properties are primarily located in Montana, Wyoming, Texas, and Oklahoma, making us vulnerable to risks associated with having operations concentrated in these geographic areas
40. 40Insurance may be insufficient to cover future liabilities
41. 41We are dependent upon information technology systems, which are subject to disruption, damage, failure and risks associated with implementation and integration
42. 42Improvements in, or new discoveries of alternative energy technologies could have a material adverse effect on our financial condition and results of operations
43. 43Competition due to advances in renewable fuels may lessen the demand for our products and negatively impact our profitability
44. 44Permitting requirements could delay our ability to start or continue our operations
45. 45Negative public perception regarding us and/or our industry could have an adverse effect on our operations
46. 46Seasonal weather conditions adversely affect our ability to conduct drilling activities in some of the areas where we operate
47. 47Shortages of equipment, services and qualified personnel could reduce our cash flow and adversely affect results of operations
48. 48Our oil and natural gas reserves are estimated and may not reflect the actual volumes of oil and natural gas we will receive, and significant inaccuracies in these reserve estimates or underlying assumptions will materially affect the quantities and present value of our reserves
49. 49the accuracy of the assumptions
50. 50We may purchase industrial gas, oil and natural gas properties with liabilities or risks that we did not know about or that we did not assess correctly, and, as a result, we could be subject to liabilities that could adversely affect our results of operations

Risks Related to Our Financial Statements

1. 51We have written down, and may in the future be forced to further write-down, material portions of our assets due to low oil and natural gas prices
2. 52There are inherent limitations in all control systems and misstatements due to error or fraud that may occur and not be detected
3. 53Our ability to use net operating loss carryforwards and realize built in losses to offset future taxable income for U.S. federal income tax purposes is subject to limitation

Risks Related to Governmental Regulations

1. 54Industrial gas, oil and natural gas operations are subject to environmental, legislative and regulatory initiatives that can materially adversely affect the timing and cost of operations and the demand for industrial gas, oil, natural gas, and NGLs
2. 55Proposed changes to U.S. tax laws, if adopted, could have an adverse effect on our business, financial condition, results of operations, and cash flows
3. 56The conflicts in Ukraine and Israel and related price volatility and geopolitical instability could negatively impact our business

Risks Related to U.S. Government Operations

1. 57A U.S. federal government shutdown could adversely affect our business, results of operations, and financial conditionNew
2. 58Our business is subject to risks associated with imposition of tariffs or other trade barriers by the United States or foreign governmentsNew

Risks Related to Management, Employees and Directors

1. 59Potential conflicts of interest could arise for certain members of our Board of Directors that hold management positions with other entities and also represent our majority stockholders88% rewritten
2. 60We depend significantly upon the continued involvement of our present management21% rewritten

Risks Related to Our Credit Agreement

1. 61Our obligations under our credit agreement with FirstBank Southwest (the "Credit Agreement") are secured by a first priority security interest in substantially all of our assets
2. 62Our failure to comply with the covenants in the documents governing our existing and future indebtedness could materially adversely affect our financial condition and liquidity
3. 63The covenants in our credit and loan agreements restrict our ability to operate our business and might lead to a default under our Credit Agreement

Risks Related to Our Common Stock

1. 64We currently have 245,000,000 shares of common stock authorized and there may be future issuances of sales of our common stock, which could adversely affect the market price of our common stock and dilute a stockholder ’ s ownership of common stock
2. 65We have established preferred stock which can be designated by the Board of Directors without stockholder approval
3. 66Our stock price has historically been and is likely to continue to be volatile31% rewritten
4. 67changes in the national and global economic outlook, including, but not limited to, as a result of inflation and interest rates, and global conflicts, including the current ongoing conflict between Ukraine and Russia), and tariffs
5. 68Our Common Stock may be delisted from The Nasdaq Capital Market if we cannot satisfy Nasdaq ’ s continued listing requirements
6. 69If our common stock is delisted from The Nasdaq Capital Market, your ability to sell your shares of our common stock could also be limited by the penny stock restrictions, which could further limit the marketability of your shares
7. 70Our Board of Directors has determined to suspend our quarterly cash dividend62% rewritten
8. 71Our stock repurchases are discretionary and even if effected, they may not achieve the desired objectives
9. 72A sale of a substantial number of registered shares of common could cause the price of our common stock to decline and make it harder for us to sell equity in the future44% rewritten

Risks Relating to our Purchase Agreement with Roth Principal Investments

1. 73The issuance and sale of our Common Stock to Roth Principal Investments may cause dilution to our other stockholders and the sale of the shares of Common Stock acquired by Roth Principal Investments, or the perception that such sales may occur, could cause the price of our Common Stock to fallNew
2. 74It is not possible to predict the actual number of shares we will sell under the Purchase Agreement to Roth Principal Investments, or the actual gross proceeds resulting from those salesNew
3. 75The Roth Principal Investments will pay less than the then-prevailing market price for our shares of Common Stock, which could cause the price of our Common Stock to declineNew
4. 76We will owe the Roth Principal Investments additional consideration in the event it does not generate at least $450,000 in proceeds from the Roth Principal Investments ’ resale of the Commitment SharesNew

Risks Relating to Our Governing Documents and Delaware Law

1. 77Our Certificate of Incorporation provides for indemnification of officers and directors at our expense and limits their liability, which may result in a major cost to us and hurt the interests of our stockholders because corporate resources may be expended for the benefit of officers or directors
2. 78The limitation of monetary liability against our directors, officers and employees under Delaware law and the existence of indemnification rights to them may result in substantial expenditures by us and may discourage lawsuits against our directors, officers and employees69% rewritten
3. 79limiting the liability of, and providing indemnification to, our directors and officers
4. 80Our Certificate of Incorporation contains exclusive forum provisions that may discourage lawsuits against us and our directors and officers
5. 81maintain an investor relations function
6. 82Our business could be adversely affected by security threats, including cybersecurity threats
7. 83The threat and impact of terrorist attacks, cyber-attacks or similar hostilities may adversely impact our operations
8. 84We may have difficulty managing growth in our business, which could have a material adverse effect on our business, financial condition and results of operations and our ability to execute our business plan in a timely fashion
9. 85Failure to adequately protect critical data and technology systems could materially affect our operations
10. 86If we complete acquisitions or enter into business combinations in the future, they may disrupt or have a negative impact on our business
11. 87the effect of any government regulations which relate to the business acquired
12. 88If persons engage in short sales of our common stock, the price of our common stock may decline
13. 89Stockholders may be diluted significantly through our efforts to obtain financing and satisfy obligations through the issuance of securities
14. 90Future litigation or governmental proceedings could result in material adverse consequences, including judgments or settlements
15. 91We may become involved in securities class action litigation that could divert management ’ s attention and harm the combined company ’ s business, and insurance coverage may not be sufficient to cover all costs and damages
16. 92The physical effects of climate change could disrupt our production and cause us to incur significant costs in preparing for or responding to those effects. An economy-wide transition to lower GHG energy sources could have a variety of adverse effects on our operations and financial results
17. 93The Company does not insure against all potential losses, which could result in significant financial exposure
18. 94Increasing attention to environmental, social, and governance (ESG) matters may impact our business
19. 95Global economic conditions could materially adversely affect our business, results of operations, financial condition and growth
20. 96We may be adversely affected by climate change or by legal, regulatory or market responses to such change
21. 97We might be adversely impacted by changes in accounting standards
22. 98Future changes to U.S. tax laws, if adopted, could have an adverse effect on our business, financial condition, results of operations, and cash flows