Nephros (NEPH) risk factors, FY2025 10-K

Risks Related to Our Overall Business and Operations

1. 01We have only a limited history of profitability and a significant accumulated deficit, and we may not be able to maintain or improve our profitability in the future49% rewritten
2. 02We may be unable to achieve or sustain revenue growth34% rewritten
3. 03We face significant challenges in obtaining market acceptance of our products, which could adversely affect our potential sales and revenues
4. 04If we are not able to successfully scale-up production of our products, then our sales and revenues will suffer
5. 05The revenue from our emergency response business is unpredictable and is subject to factors outside our control. As a result, our revenue and operating results may vary significantly from period to period
6. 06If we cannot develop adequate distribution, customer service and technical support networks, then we may not be able to market and distribute our products effectively and/or customers may decide not to order our products. In either case, our sales and revenues will suffer
7. 07We are dependent on third parties to supply us with our products, making us vulnerable to supply problems and price fluctuations
8. 08Significant developments resulting from recent and potential changes in United States tariff policies could have a material adverse effect on us New
9. 09We are subject to minimum purchase obligations under our License and Supply Agreement with Medica and failure to meet these minimum purchase requirements may result in termination of the agreement, which could materially impact our ability to obtain our filtration products24% rewritten
10. 10We operate with a limited senior management team and are highly dependent on our sales and marketing personnel. Our business could be harmed if we are unable to attract and retain personnel necessary for our success
11. 11We rely on information technology systems and network infrastructure to operate and manage our business. If we experience a breach, cyber attack or other disruption to these systems or data, our business, results of operations and financial condition could be adversely affected
12. 12Product liability associated with the production, marketing, and sale of our products, and/or the expense of defending against claims of product liability, could materially deplete our assets and generate negative publicity which could impair our reputation
13. 13We rely on both employees and third-party contractors to install and service our water filtration products, and any failure by these parties to perform adequately could adversely affect our business and reputation New

Risks Related to Government Regulation

1. 14If we violate any provisions of the FDC Act or any other statutes or regulations, then we could be subject to enforcement actions by the FDA or other governmental agencies
2. 15Any of the above could have a material adverse effect on our business, financial condition, and results of operations
3. 16Significant additional governmental regulation could subject us to unanticipated delays that would adversely affect our sales and revenues
4. 17If we are not able to maintain sufficient quality controls, then the approval or clearance of any of our future products by the FDA or other relevant authorities could be withdrawn, delayed, or denied and our sales and revenues will suffer

Risks Related to our Intellectual Property

1. 18Protecting our intellectual property in our technology through patents may be costly and ineffective. If we are not able to adequately secure or enforce protection of our intellectual property, then we may not be able to compete effectively and we may not be profitable

Risks Related to Owning Our Common Stock

1. 19The prices at which shares of the common stock trade have been and will likely continue to be volatile21% rewritten
2. 20Our common stock could be further diluted as a result of the issuance of additional shares of common stock, warrants or options64% rewritten
3. 21We have never paid dividends and do not intend to pay cash dividends
4. 22Several provisions of the Delaware General Corporation Law, our fourth amended and restated certificate of incorporation, as amended, and our second amended and restated bylaws could discourage, delay or prevent a merger or acquisition, which could adversely affect the market price of our common stock
5. 23Our directors, executive officers, and Wexford Capital control a significant portion of our stock and, if they choose to vote together, could have sufficient voting power to control the vote on substantially all corporate matters
6. 24Future sales of our common stock could cause the market price of our common stock to decline