Twin Vee PowerCats (VEEE) risk factors, FY2025 10-K

Risks Related to our Business

1. 01There is limited public information on our operating history
2. 02We have incurred losses for the years ended December 31, 2025 and 2024 and could continue to incur losses in the future64% rewritten
3. 03Our ability to meet our manufacturing workforce needs is crucial to our results of operations and future sales and profitability
4. 04We have a large, fixed cost base that will affect our profitability if our sales decrease
5. 05Interest rates and energy prices affect product sales
6. 06Changes in general economic conditions, geopolitical conditions, domestic and foreign trade policies, monetary policies and other factors beyond our control may adversely impact our business and operating results91% rewritten
7. 07The uncertain financial markets, disruptions in supply chains, mobility restraints, and changing priorities as well as volatile asset values could impact our business in the futureNew
8. 08Our annual and quarterly financial results are subject to significant fluctuations depending on various factors, many of which are beyond our control
9. 09Unfavorable weather conditions may have a material adverse effect on our business, financial condition, and results of operations, especially during the peak boating season
10. 10A natural disaster, the effects of climate change, or other disruptions at our manufacturing facility could adversely affect our business, financial condition, and results of operations
11. 11If we fail to manage our manufacturing levels while still addressing the seasonal retail pattern for our products, our business and margins may suffer
12. 12We depend on our network of independent dealers for our boats, face increasing competition for dealers, and have little control over their activities22% rewritten
13. 13The loss of one or a few dealers could have a material adverse effect on usNew
14. 14Our success depends, in part, upon the financial health of our dealers and their continued access to financing
15. 15We may be required to repurchase inventory of certain dealers22% rewritten
16. 16We rely on third-party suppliers in the manufacturing of our boats
17. 17Termination or interruption of informal supply arrangements could have a material adverse effect on our business or results of operations
18. 18Significant product repair and/or replacement due to product warranty claims or product recalls could have a material adverse impact on our results of operations
19. 19The nature of our business exposes us to workers’ compensation claims and other workplace liabilities
20. 20If we are unable to comply with environmental and other regulatory requirements, our business may be exposed to material liability and/or fines
21. 21Our industry is characterized by intense competition, which affects our sales and profits
22. 22We face increasing competition for dealers and have little control over their activities
23. 23Our sales may be adversely impacted by increased consumer preference for other leisure activities or used boats or the supply of new boats by competitors in excess of demand
24. 24Our sales and profitability depend, in part, on the successful introduction of new products
25. 25Our success depends upon the continued strength of our brand, the value of our brand, and sales of our products could be diminished if we, the consumers who use our products, or the sports and activities in which our products are used are associated with negative publicity
26. 26We may not be able to execute our manufacturing strategy successfully, which could cause the profitability of our products to suffer
27. 27We will rely on complex machinery for our operations, and production involves a significant degree of risk and uncertainty in terms of operational performance, safety, security, and costs
28. 28We may need to raise additional capital that may be required to grow our business, and we may not be able to raise capital on terms acceptable to us or at all
29. 29If we fail to manage future growth effectively, we may not be able to market or sell our products successfully
30. 30We depend upon our executive officers and we may not be able to retain them and their knowledge of our business and technical expertise would be difficult to replace
31. 31Certain of our shareholders have sufficient voting power to make corporate governance decisions that could have a significant influence on us and the other stockholders
32. 32We may attempt to grow our business through acquisitions or strategic alliances and new partnerships, which we may not be successful in completing or integrating82% rewritten
33. 33If we are unable to comply with regulatory requirements governing government contracts and public procurement, our business may be exposed to material liability and/or fines, which could have a material adverse effect on our business, financial condition and results of operationsNew
34. 34Our business and operations would suffer in the event of computer system failures
35. 35We are increasingly dependent on information technology, and our systems and infrastructure face certain risks, including cybersecurity and data leakage risks
36. 36Uninsured losses could result in payment of substantial damages, which would decrease our cash reserves and could harm our cash flow and financial condition
37. 37Our investments in artificial intelligence may not be successful, which could adversely affect our business, reputation, or financial resultsNew
38. 38We are currently, and may in the future be, subject to substantial litigation, regulatory actions, government investigations, proceedings and similar actions that could cause us to incur significant legal expenses and which could have a material adverse effect on our business, operating results or financial condition
39. 39We may not be able to prevent others from unauthorized use of our intellectual property, which could harm our business and competitive position
40. 40We may in the future become, subject to claims that we or our employees have wrongfully used or disclosed alleged trade secrets of our employees’ former employers
41. 41Our use of open-source software in our applications could subject our proprietary software to general release, adversely affect our ability to sell our services and subject us to possible litigation, claims or proceedings
42. 42A significant portion of our intellectual property is not protected through patents or formal copyright registration. As a result, we do not have the full benefit of patent or copyright laws to prevent others from replicating our products, product candidates and brands
43. 43Confidentiality agreements with employees and others may not adequately prevent disclosure of trade secrets and other proprietary information
44. 44We may need to defend ourselves against patent, copyright or trademark infringement claims, which may be time-consuming and would cause us to incur substantial costs

Risks Related to our Industry

1. 45Demand in the powerboat industry is highly volatile
2. 46General economic conditions, particularly in the U.S., affect our industry, demand for our products and our business, and results of operations
3. 47Global economic conditions could materially adversely impact demand for our products and services

Risks Related to Ownership of our Common Stock

1. 48Any failure to meet the continued listing requirements of The Nasdaq Capital Market could result in a de-listing of our common stock61% rewritten
2. 49There can be no assurance that our increased stock price following the Reverse Stock Split will remain at a price that will be sufficient in order to meet any continued requirements and policies of Nasdaq or that our common stock will remain listed on Nasdaq77% rewritten
3. 50In addition, Nasdaq Listing Rule 5810(c)(3)(A)(iv) states that if a listed company that fails to meet the Minimum Bid Price Requirement after effecting one or more reverse stock splits over the prior two-year period with a cumulative ratio of 250 shares or more to one, it will not be eligible for a Compliance PeriodNew
4. 51Terms of subsequent financings may adversely impact your investment
5. 52If securities analysts do not publish research or reports about our company, 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. 53The obligations associated with being a public company will require significant resources and management attention, which may divert from our business operations
7. 54There is substantial doubt about our ability to continue as a going concernNew
8. 55We have identified weaknesses in our internal controls, and we cannot provide assurances that these weaknesses will be effectively remediated or that additional material weaknesses will not occur in the future44% rewritten
9. 56The Sarbanes-Oxley Act requires, among other things, that we maintain effective disclosure controls and procedures, and internal control over financial reporting
10. 57We will be required to expend time and resources to further improve our internal controls over financial reporting, including by expanding our staff. However, we cannot assure you that our internal control over financial reporting, as modified, will enable us to identify or avoid material weaknesses in the future27% rewritten
11. 58Our failure to achieve and maintain effective internal control over financial reporting in accordance with Section 404 of the Sarbanes-Oxley Act as a public company could have a material adverse effect on our business and share price
12. 59For as long as we are an emerging growth company, we will not be required to comply with certain reporting requirements, including those relating to accounting standards and disclosure about our executive compensation, that apply to other public companies
13. 60Our stock price has fluctuated in the past, has recently been volatile, and may be volatile in the future, and as a result, investors in our common stock could incur substantial losses36% rewritten
14. 61Our common stock has often been thinly traded, so investors may be unable to sell at or near ask prices or at all if investors need to sell shares to raise money or otherwise desire to liquidate their shares
15. 62We do not intend to pay dividends on our common stock for the foreseeable future
16. 63FINRA sales practice requirements may limit your ability to buy and sell our common stock, which could depress the price of our shares
17. 64Provisions in our corporate charter documents and under Delaware law could make an acquisition of our company, which may be beneficial to our stockholders, more difficult and may prevent attempts by our stockholders to replace or remove our current management