Deep Fission (FISN) risk factors, FY2025 10-K

Risks Related to Our Business and Industry

1. 01Our Gravity Reactor is unproven, and our design, borehole development activities, planned pilot reactor, and future commercial applications may fail, progress more slowly than projected, or encounter delays or changes that increase costs and capital requirements
2. 02Legacy Deep Fission was formed in 2023 and has not generated revenue from commercial operations. During the years ended December 31, 2025 and 2024, we incurred net losses of $61.0 million and $5.7 million, respectively
3. 03Our auditor has issued a “going concern” opinion with respect to our financial statements
4. 04Our business plans require substantial additional capital, and we may not be able to obtain financing on acceptable terms or at all
5. 05We expect that we will need to raise additional capital through equity issuances, debt financings, strategic partnerships, government programs, or other financing arrangements. However, there can be no assurance that such financing will be available on acceptable terms, on a timely basis, or at all
6. 06Our technology depends on the successful drilling and long-term stability of deep vertical boreholes, which presents significant technical, engineering, regulatory and operational risks
7. 07Our staged borehole development program (including non-nuclear and prototype wells) may not successfully validate drilling methods, installation procedures, or subsurface performance assumptions necessary for reactor deployment
8. 08We may be unable to identify, acquire, lease, or otherwise secure access to suitable sites with the geological characteristics necessary to deploy our Gravity Reactor
9. 09The safe and reliable operation of nuclear reactors requires highly specialized technical capabilities, operational procedures, safety culture, regulatory compliance systems, and experienced personnel. We have not yet constructed or operated a nuclear power facility, commercial or otherwise
10. 10The market for our Gravity Reactor is not yet established and may not achieve the growth potential we expect or may grow more slowly than expected. If demand for our technology fails to develop sufficiently, our business and operations would suffer, and we would be unable to achieve or maintain profitability
11. 11Our ability to deploy reactors commercially will depend on our ability to enter into long-term power purchase agreements or other commercial arrangements with customers
12. 12Our future revenue plans depend in part on strategic partners and government entities
13. 13Electricity generated by our Gravity Reactors may not be cost-competitive with other energy generation technologies, and competing energy solutions could reduce demand for our reactors and related services
14. 14Delays or failures in obtaining grid interconnection approvals could delay or prevent deployment of our reactors
15. 15Our development timelines, cost projections, and financial forecasts are subject to significant uncertainty
16. 16These estimates are based on numerous assumptions, including assumptions regarding regulatory approvals, engineering performance, supply chain availability, financing conditions, market demand, and the availability of suitable deployment sites
17. 17Manufacturing or construction issues could increase costs or delay deployment of our reactors
18. 18While we have entered into an agreement to procure LEU for certain demonstration and initial operations, we have not secured sufficient fuel supply or fuel cycle service arrangements to support ongoing or large-scale commercial deployment of our reactors
19. 19Our reactors will depend on specialized components and suppliers, and disruptions in the supply chain could delay development, interrupt operations or increase costs
20. 20Construction, drilling, installation procedures and development activities associated with our reactor facilities involve inherent safety risks and could result in workplace accidents, injuries, or fatalities
21. 21Our Gravity Reactor could experience a nuclear incident or otherwise cause environmental contamination, personal injuries or property damage, and reputational harm or losses not covered by indemnification or insurance could materially adversely affect our business
22. 22Our insurance coverage and any available indemnification may not be sufficient to cover all potential liabilities associated with our operations
23. 23The operation of our reactors will generate used nuclear fuel that must be stored and ultimately disposed of in accordance with applicable legal and regulatory requirements. The costs associated with storing and managing used nuclear fuel may be significant and could increase over time
24. 24If the costs associated with used nuclear fuel management are higher than anticipated, or if storage or disposal options remain unavailable or subject to more burdensome legal and regulatory requirements, our business, prospects, financial condition, and results of operations could be materially adversely affected
25. 25Changes in government incentives related to nuclear power may adversely affect our business

Risks Related to Our Regulatory Environment

1. 26Our business is subject to extensive government regulation, including licensing by the U.S. Nuclear Regulatory Commission, and delays or failures in obtaining required approvals could prevent or delay commercialization of our technology
2. 27The DOE’s authorization under our OTA could be terminated or overturned, which could prevent or delay commercialization of our technology
3. 28Our applications to the NRC may not be approved, and any rework necessary to address NRC concerns could significantly delay the commercialization of our products
4. 29Government shutdowns, federal budget delays, federal debt ceiling limitations, or reductions in government spending could adversely impact government spending on U.S. government programs related to our products or services
5. 30Our participation in ongoing litigation challenging aspects of the NRC’s licensing framework exposes us to regulatory uncertainty, increased scrutiny, and potential delays or adverse outcomes in connection with required NRC approvals
6. 31We are required to comply with governmental export control, economic sanctions, import and other laws and regulations. Our failure to comply with these laws and regulations could have an adverse effect on our business, prospects, financial condition, and results of operations
7. 32We are subject to anti-corruption, anti-bribery, and anti-money laundering laws and regulations, and violations of these laws could result in significant penalties and reputational harm
8. 33Nuclear incidents anywhere in the world could increase regulatory requirements, reduce public acceptance of nuclear power, and adversely affect demand for our technology
9. 34In addition, terrorist acts or other high-profile incidents involving nuclear facilities or radioactive materials could lead to increased security requirements, additional regulatory scrutiny, or greater opposition to nuclear energy projects
10. 35Environmental laws and regulations could increase costs for us or our customers and adversely affect demand for our technology

Risks Related to Our Intellectual Property

1. 36If we are unable to obtain, maintain, protect, or enforce our intellectual property rights, our competitive position could be adversely affected
2. 37Our patent applications may not result in issued patents, and issued patents may be challenged, invalidated, circumvented, or limited in scope. In addition, patent protection may not be available in all jurisdictions where our technology could be used
3. 38Third parties may assert that our technologies infringe their patents, trademarks, or other intellectual property rights. From time to time we may receive inquiries or claims from intellectual property holders regarding whether our technologies infringe their proprietary rights
4. 39Disputes regarding inventorship or ownership of our intellectual property could arise
5. 40Macroeconomic, geopolitical, and trade policy developments could adversely affect our access to capital and liquidity, business and our supply chain
6. 41These transactions could divert management attention from our core business, increase our expenses, reduce our cash reserves, or result in the impairment of acquired assets. In addition, if financed with debt or equity, such transactions could increase our indebtedness or dilute our existing stockholders
7. 42We may be unable to adequately control the costs associated with developing and operating our business
8. 43If we fail to manage our growth effectively, we may be unable to execute our business plan
9. 44Security breaches, cyber-attacks, or other disruptions to information technology systems, including those of our third-party service providers, could compromise our proprietary information and harm our business
10. 45Our use of artificial intelligence technologies, including those provided by third parties, could adversely affect our business
11. 46Natural disasters and severe weather events could disrupt our operations and supply chain
12. 47We depend on the continued services of our key personnel, and the loss of one or more members of our management team could adversely affect our business
13. 48We may be subject to litigation, investigations, claims or other legal proceedings that could be costly to defend and could adversely affect our business
14. 49Operating as a public company increases our administrative burden and costs

Risks Related to Ownership of Our Common Stock

1. 50There is currently no public trading market for our common stock, and one may not develop
2. 51There is currently no public trading market for our common stock
3. 52We currently do not meet the listing requirements of any national securities exchange and may not be able to satisfy those requirements in the future
4. 53We have not voluntarily implemented various corporate governance measures, in the absence of which, our stockholders may have more limited protections against interested director transactions, conflicts of interest and similar matters
5. 54If a trading market for our common stock develops, the market price of our common stock may fluctuate significantly. The market prices of securities of early-stage companies in emerging industries are often highly volatile
6. 55Future sales of our common stock could cause our stock price to decline
7. 56Our executive officers, directors and principal stockholders collectively hold a significant percentage of the voting power of our company
8. 57For example, we are not required to have our independent registered public accounting firm attest to the effectiveness of our internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act for as long as we remain an emerging growth company
9. 58Anti-takeover provisions in our charter documents and under Delaware law could make an acquisition of us more difficult and may discourage takeover attempts that stockholders may consider favorable
10. 59In addition, we are subject to Section 203 of the Delaware General Corporation Law, which restricts certain business combinations with stockholders who own 15% or more of our outstanding voting stock unless certain conditions are satisfied
11. 60Our amended and restated certificate of incorporation designates certain courts as the exclusive forum for certain stockholder disputes
12. 61If our common stock becomes publicly traded and securities analysts do not publish research or reports about our business or if they downgrade our stock or our sector, our stock price and trading volume could decline