CleanCore Solutions (ZONE) risk factors, FY2025 10-K

Risks Related to Our Business and Industry

1. 01We are an early-stage company with a limited operating history
2. 02We have incurred losses since our inception, and we may not be able to manage our business on a profitable basis21% rewritten
3. 03Our auditors have issued a going concern opinion on our audited consolidated financial statements33% rewritten
4. 04We will require additional financing to accomplish our business strategy
5. 05We cannot accurately predict future revenues or profitability in the emerging market for aqueous ozone technology
6. 06We may face significant challenges in obtaining market acceptance of our products, which could adversely affect our potential sales and revenues
7. 07If we do not build brand awareness and brand loyalty, our business may suffer
8. 08If we fail to properly manage our anticipated growth, our business could suffer
9. 09If we are unable to maintain, train and build an effective international sales and marketing infrastructure, we will not be able to commercialize and grow our brand successfully
10. 10We operate in new and rapidly changing markets, which makes it difficult to evaluate our future prospects and may increase the risk that we will not be successful
11. 11Our major customers account for a significant portion of our revenue and the loss of any major customer could have a material adverse effect on our results of operations79% rewritten
12. 12We have historically depended on a limited number of third parties to supply key raw materials to us and the failure to obtain a sufficient supply of these raw materials in a timely fashion and at reasonable costs could significantly delay our delivery of products77% rewritten
13. 13Increased prices for raw materials could increase our cost of sales and decrease demand for our products, which could adversely affect our revenue or profitability
14. 14Changes to U.S. trade policy, tariff and import/export regulations may adversely affect our operating resultsNew
15. 15Interruptions in deliveries of raw materials could adversely affect our revenue or profitability74% rewritten
16. 16If our fulfillment operations are interrupted for any significant period of time or are not sufficient to accommodate increased demand, our sales could decline, and our reputation could be harmed
17. 17If commodity prices such as fuel, plastic and steel increase, our margins may be negatively impacted
18. 18Business interruptions in our facilities may affect the distribution of our products and/or the stability of our computer systems, which may affect our business
19. 19Security threats, such as ransomware attacks, to our IT infrastructure could expose us to liability, and damage our reputation and business
20. 20We face significant competition
21. 21Quality problems with, and product liability claims in connection with, our aqueous ozone machines could lead to recalls or safety alerts, harm to our reputation, or adverse verdicts or costly settlements, and could have a material adverse effect on our business, financial condition, and results of operations
22. 22We may receive a significant number of warranty claims or our aqueous ozone products may require significant amounts of service after sale
23. 23We could be subject to litigation
24. 24If we are unable to protect our intellectual property rights, our reputation and brand could be impaired, and we could lose customers
25. 25Assertions by third parties of infringement, misappropriation or other violation by us of their intellectual property rights could result in significant costs and substantially harm our business and operating results
26. 26The loss of key personnel, an inability to attract and retain additional personnel or difficulties in the integration of new members of our management team into our company could affect our ability to successfully grow our business
27. 27Failure to comply with privacy laws and regulations and failure to adequately protect customer data could harm our business, damage our reputation and result in the loss of customers
28. 28We will face growing regulatory and compliance requirements in a variety of areas, which can be costly and time consuming
29. 29Legislation or government regulations may be adopted which may affect our products and liability
30. 30We are subject to, and must remain in compliance with, numerous laws and governmental regulations concerning the manufacturing, use, distribution and sale of our products. Some of our customers also require that it complies with their own unique requirements relating to these matters
31. 31Economic, political and other risks associated with our international operations could adversely affect our revenues and international growth prospects
32. 32Our international operations require us to comply with anti-corruption laws and regulations of the U.S. government and various international jurisdictions in which we do business63% rewritten
33. 33The impact of geopolitical conflicts may adversely affect our business and results of operationsNew
34. 34Industry and other market data that may be used in our periodic reports that we may file with the SEC and our other materials, including those undertaken by us or our engaged consultants, may not prove to be representative of current and future market conditions or future results

Risks Related to Ownership of Our Common Stock

1. 35We may not be able to maintain a listing of our class B common stock on NYSE American
2. 36The market price of our stock may be highly volatile, and you could lose all or part of your investment
3. 37We do not expect to declare or pay dividends in the foreseeable future82% rewritten
4. 38Future issuances of our class B common stock or securities convertible into, or exercisable or exchangeable for, our class B common stock could cause the market price of our class B common stock to decline and would result in the dilution of your holdingsNew
5. 39If securities industry analysts do not publish research reports on us, or publish unfavorable reports on us, then the market price and market trading volume of our class B common stock could be negatively affected89% rewritten
6. 40If our shares of class B common stock become subject to the penny stock rules, it would become more difficult to trade our shares
7. 41We are subject to ongoing public reporting requirements that are less rigorous than rules for companies that are not emerging growth companies, and our stockholders could receive less information than they might expect to receive from more mature public companies46% rewritten
8. 42We are also a smaller reporting company, and if we take advantage of certain exemptions from SEC disclosure requirements available to smaller reporting companies, this could make our securities less attractive to investors and may make it more difficult to compare our performance with other public companiesNew
9. 43We are a controlled company and a smaller reporting company under the rules of NYSE American and as a result, we may choose to exempt our company from certain corporate governance requirements that could have an adverse effect on our public stockholders38% rewritten
10. 44Anti-takeover provisions in our charter documents and under Nevada law could make an acquisition of our company more difficult, and limit attempts by our stockholders to replace or remove our current management