Exozymes (EXOZ) risk factors, 2025 10-K

Other

1. 01eXoZymes has a limited operating history on which to evaluate its ability to achieve its operating objectives
2. 02Our financial statements include a going concern footnote
3. 03We cannot assure you that we will generate revenue or become profitable in the future
4. 04We may need additional capital to support our growth over time. Additional capital, may be difficult to obtain thus restricting our operations and resulting in additional dilution to our stockholders
5. 05In the future, we may not be able to obtain government and private grants which have been an important source of funding our operations since inception
6. 06We are unsure if and when eXoZymes will become profitable
7. 07eXoZymes may not be successful in its efforts to use its proprietary biomanufacturing platform to build a pipeline of products
8. 08The market, including clients and potential investors, may be skeptical of the viability and benefits of eXoZymes’s pipeline chemical products because they are relatively novel and are based on complex technology
9. 09The synthetic biology market is a rapidly expanding and changing market, and if eXoZymes is unable to keep up to date with developments, its business may be adversely affected
10. 10eXoZymes may face unique regulatory hurdles because its bio-synthesized compounds are novel
11. 11Because its chemical and small molecule compounds are novel, eXoZymes may have to perform tests for safety, use, approval and claim validation
12. 12eXoZymes is highly dependent on its ability to retain its current management and its scientific team and other staff to run the company, and be able to recruit and hire additional employees with specialized backgrounds as needed
13. 13Our ability to retain our senior management and recruit additional senior management is important to the success of our business, and our failure to do so may adversely affect our reputation, business, results of operations and financial condition
14. 14Laboratory conditions differ from commercial conditions, which could affect the effectiveness of our potential products. Failures to effectively move from laboratory to commercial scale would harm our business
15. 15Our systems rely on the need for purified enzymes and co-factors for the conversions of input feedstock into final products. We will need to find competitively priced sources of, or ways of making these inputs for our process to be cost competitive and/or develop methods to use these resources efficiently
16. 16We will be subject to fluctuations in pricing for the products we choose to develop and commercialize
17. 17Our business depends upon our ability to make good decisions regarding the deployment of capital and, ultimately, the performance of our products which is uncertain
18. 18Our success depends, in part, on the successful development of our science technologies and our products
19. 19We are subject to risks relating to portfolio concentration
20. 20We do not have any significant sales, marketing, manufacturing and distribution capabilities or arrangements, and will need to create these as we move towards commercialization of our products
21. 21Collaborations of various sorts, by our partner companies, such as with respect to research, testing, manufacturing and distribution, will be important to our business. The inability to enter into collaboration arrangements as needed, or if such collaborations are not successful, may adversely impact our business
22. 22(ix) collaborations may not be negotiated on a timely basis or acceptable terms, if at all, or they may require substantial additional capital so as to be able to pursue and fund a collaboration
23. 23We expect to experience competition from other companies and research institutions

Risks Related to Intellectual Property and Other Legal Matters

1. 24If we are unable to protect the intellectual property used in our technology platform and products, others may be able to copy our innovations which may impair our ability to compete effectively in our markets
2. 25We also are pursuing patent applications in jurisdictions other than the United States where we believe such protection is warranted in relation to the development and marketing of our processes and products
3. 26If we are unable to protect the confidentiality of our proprietary information and know-how, the value of our technology and products could be adversely affected
4. 27If we fail to comply with our obligations in the agreements under which we license development or commercialization rights to products or technology from third-parties, we could lose license rights that are important to our business
5. 28Our license fees to The Regents may exceed our income from product revenues based on the licensed patents
6. 29If we or our licensors are unable to protect our/their intellectual property, then our financial condition, results of operations and the value of our technology and products could be adversely affected
7. 30Litigation or third-party claims of intellectual property infringement or challenges to the validity of our patents would require us to use resources to protect our technology and may prevent or delay our development or commercialization of our product candidates
8. 31Third-party claims of intellectual property infringement may prevent or delay our development and commercialization activities for other products
9. 32We may become involved in future lawsuits to protect or enforce our patents or the patents of our licensors, which could be expensive, time consuming and unsuccessful
10. 33If trademarks and trade names are not adequately protected, then we may not be able to build name recognition in the markets of interest and our business may be adversely affected

Risks Related to this Being a Public Company

1. 34We will incur increased costs as a result of operating as a public company, and our board of directors will be required to devote substantial time to oversight of new compliance requirements and corporate governance practices
2. 35We currently have limited accounting personnel with the background in public company accounting and reporting. We will have to add personnel and devote personnel and financial resources to meet our reporting obligations as a publicly listed company
3. 36If we fail to develop or maintain an effective system of internal control over financial reporting, we may not be able to accurately report our financial results or prevent financial fraud. As a result, current and potential stockholders could lose confidence in our financial reporting
4. 37We currently have a single facility that is our main office and laboratory. Any disruption in our ability to operate from this facility would delay our research and development efforts and does pose an operational risk
5. 38We are actively assessing risk mitigation strategies, including potential secondary locations, partnerships, and contingency planning. However, until such measures are implemented, our reliance on a single facility will continue to pose an operational risk
6. 39Concentration of ownership among our existing executive officers, directors and significant stockholders may prevent new investors from influencing significant corporate decisions
7. 40Our failure to meet the continued listing requirements of Nasdaq could result in a delisting of our Common Stock
8. 41We are an “emerging growth company” under the JOBS Act and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies will make our Common Stock less attractive to investors
9. 42Our status as an “emerging growth company” under the JOBS Act may make it more difficult to raise capital as and when we need it
10. 43We anticipate that any public market for our Common Stock will be volatile. This may affect the ability of our investors to sell their shares as well as the price at which they may be able to sell their shares
11. 44Shares eligible for future sale may adversely affect the market for our Common Stock
12. 45The ability of MDB Capital Holdings, LLC to sell up to 4,013,769 of its shares of our Common Stock, as freely tradable, registered shares of our Common Stock, may have an adverse effect on our other investors
13. 46Now that we are a publicly traded company, we may have an increased risk of securities class action litigation
14. 47We have not paid cash dividends in the past and have no immediate plans to pay cash dividends
15. 48We have technology that might be interesting to bad actors, foreign actors or nation states that has very different legal frameworks and belief system than ours