New ERA Energy & Digital (NUAI) risk factors, FY2024 10-K

Risks Related to Our Business

1. 01We have a short operating history, which makes it difficult to evaluate our business and future prospects
2. 02We cannot assure the completed construction and commencement of operations of the Pecos Slope Plant, and even after such operations, we may not be able to generate adequate revenue to operate profitably and/or to continue as a going concern
3. 03We cannot assure that we can raise enough capital to successfully develop our Pecos Slope Plant, which will adversely affect our ability to earn revenue and jeopardize our delivery of helium pursuant to existing contracts
4. 04There is no assurance that we will secure this capital, which could result in delays in realizing revenues from our helium production as well as eventually jeopardize our delivery of helium pursuant to our current helium off-take agreements
5. 05Scientific and technological changes may impact the demand for helium
6. 06Global health crises or catastrophes and other unforeseen or unavoidable events or market conditions may dampen demand for helium and negatively impact our financial performance
7. 07Helium demand in certain applications is somewhat elastic
8. 08Increases in extraction and production costs or disruptions in our natural gas supplies could materially and adversely impact our business
9. 09Our costs of operations may exceed estimates due to factors outside of our control, such as labor shortages or external price increases, and we may be unable to pass those costs to our customers, which would negatively impact our financial results
10. 10A delayed commencement date or other events could result in an early termination of certain of our material contracts
11. 11We have proved and probable reserves and areas that we decide to explore may not yield helium in commercial quantities or quality, or at all
12. 12The Appraisal Report included in this Report involves a significant degree of uncertainty and are based on projections that may not prove to be accurate
13. 13We may need to raise capital in the future, which may not be available on favorable terms, if at all, and which may cause dilution to our stockholders, restrict our operations or adversely affect our ability to operate and continue our business. There is no guarantee that we will successfully raise capital
14. 14We have a material weakness in our internal control over financial reporting, which, if left unremedied, could materially and adversely affect the market price of our stock
15. 15Our performance may be negatively impacted by general and regional economic volatility or an economic downturn
16. 16Our business may be adversely affected by the departure of members of our management team, Board of Directors, and key employees
17. 17If we are unable to attract, train and retain qualified personnel, we may not be able to effectively execute our business strategy
18. 18We may implement new lines of business or further diversify our revenue sources within existing lines of business, but we cannot assure that such diversification efforts will be successful
19. 19Damage to our reputation could negatively impact our business, financial condition and results of operations
20. 20We operate within highly competitive industries, and cannot guarantee that we can or will maintain a robust financial position, relative to our competitors, in order to become profitable
21. 21Our business and operations may experience rapid growth. If we fail to manage our growth, our business and operating results could be adversely affected and we may have to incur significant expenditures to address the additional operational and control requirements of such growth
22. 22Volatility in and disruption to the global economic environment, including the impact of an economic recession, trade protectionism and tariffs, and changes in the regulatory and business environments in which we operate may have a material adverse effect on our business, results of operations and financial condition
23. 23We are subject to cybersecurity risks to operational systems, security systems, or infrastructure owned by us or third-party vendors or suppliers
24. 24We operate in an intensely competitive business environment. We may not be as successful as our competitors incorporating artificial intelligence (“AI”) into our business or adapting to a rapidly changing marketplace

Risks Related to Regulatory Compliance

1. 25We face uncertainty and costly compliance with government regulations
2. 26We operate on federal and state lands, which have rules and regulations related to our business and require us to pay royalties, which may adversely affect our operations
3. 27New regulations regarding greenhouse and other gases have increased in recent years, which may adversely affect the business
4. 28If we are restricted or lack access to waste wells, we may be prevented from operating some or all of our wells, which generate the helium
5. 29If we own, operate, or acquire lands which release materials into the environment, we may be required to remediate such lands, which can be extremely costly
6. 30If our operations affect waters of the United States or endangered species, additional permits or authorizations may be needed, which could delay, hinder, or prevent new activities
7. 31We will need to obtain permits for construction and operation of the Pecos Slope Plant. The cost, time, and outcome of seeking such permits is uncertain and could result in additional costs, delays and the inability to obtain the authorizations needed for the Pecos Slope Plant

Risks Relating to the Ownership of our Securities

1. 32The price of our securities may be volatile
2. 33Future resales of common stock may cause the market price of our securities to drop significantly, even if our business is doing well
3. 34If we fail to maintain proper and effective internal controls over financial reporting, our ability to produce accurate and timely financial statements could be impaired, investors may lose confidence in our financial reporting and the trading price of the Common Stock may decline
4. 35Our common stock is currently listed on Nasdaq and we must meet certain financial and liquidity criteria to maintain such listing. If we violate the maintenance requirements for continued listing of our common stock, our common stock may be delisted
5. 36If securities analysts do not publish research or reports about us, or if they issue unfavorable commentary about us or our industry or downgrade our common stock, the price of our common stock could decline
6. 37All of our outstanding warrants will become exercisable for Common Stock, which would increase the number of shares eligible for future resale in the public market and result in dilution to our stockholders
7. 38All agreements governing our outstanding warrants contain exclusive forum clauses, which could limit a warrant holder’s ability to obtain a favorable judicial forum for disputes arising under the applicable warrant agreement
8. 39Your unexpired Tradeable Warrants may be redeemed prior to their exercise at a time that may be disadvantageous to you, thereby making your warrants worthless