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Item 1A. Risk Factors

2025-04-15 compared with 2024-04-16 · 198 added, 134 removed, 513 unchanged (39% of the section changed)

9 unchanged sentences

Relating to Our Business and Industry

operate in industries that are cyclical and sensitive to general economic conditions, which could have a material adverse effect

on our operating results, financial condition and cash flows.

conditions in global markets including the impact of sanctions and tariffs, quotas and other trade actions and import restrictions

may adversely affect our operating results, financial condition and cash flows.

in the availability or price of inputs such as raw materials and end-of-life vehicles could reduce our sales.

decreases in scrap metal prices may adversely impact our operating results.

in supply and demand conditions in the global steel industry may reduce demand for our products.

of long-lived assets and equity investments may adversely affect our operating results.

may be unable to renew facility leases, thus restricting our ability to operate.

in the value of the U.S.

We operate in industries

that are cyclical and sensitive to general economic conditions, which could have a material adverse effect on our operating results,

financial condition and cash flows.

Changing conditions in

global markets including the impact of sanctions and tariffs, quotas and other trade actions and import restrictions may adversely

affect our operating results, financial condition and cash flows.

Changes in the availability

or price of inputs such as raw materials and end-of-life vehicles could reduce our sales.

Significant decreases in

scrap metal prices may adversely impact our operating results.

Imbalances in supply and

demand conditions in the global steel industry may reduce demand for our products.

Impairment of long-lived

assets and equity investments may adversely affect our operating results.

Increases in the value

dollar relative to other currencies may reduce the demand for our products.

upgrades, equipment failures and facility damage may lead to production curtailments or shutdowns.

are subject to legal proceedings and legal compliance risks that may adversely impact our financial condition, results of operations

and liquidity.

change may adversely impact our facilities and our ongoing operations.

events may disrupt our business and impair our ability to provide our platform to clients and consumers, resulting in costs for remediation,

Equipment upgrades, equipment

failures and facility damage may lead to production curtailments or shutdowns.

We are subject to legal

proceedings and legal compliance risks that may adversely impact our financial condition, results of operations and liquidity.

Climate change may adversely

impact our facilities and our ongoing operations.

Catastrophic events may

disrupt our business and impair our ability to provide our platform to clients and consumers, resulting in costs for remediation,

client and consumer dissatisfaction, and other business or financial losses.

depend on a small number of suppliers for the materials necessary to run our business.

The loss of these suppliers, or their failure

to supply us with these materials, would materially and adversely affect our business.

have substantial customer concentration, with a limited number of customers accounting for a substantial portion of our 2023 and

2022 revenues.

have a limited history upon which an evaluation of our prospects and future performance can be made and have no history of profitable

are highly dependent on the services of key executives, the loss of whom could materially harm our business and our strategic direction.

If we lose key management or significant personnel, cannot recruit qualified employees, directors, officers, or other personnel or

experience increases in our compensation costs, our business may materially suffer.

may need to obtain additional financing to fund our operations.

independent registered accounting firm has expressed concerns about our ability to continue as a going concern.

the past we have experienced material weaknesses in our internal control over financial reporting, which if continued, could impair

our financial condition.

We depend on a small number

of suppliers for the materials necessary to run our business.

The loss of these suppliers, or their failure to supply us with these

materials, would materially and adversely affect our business.

We have substantial customer

concentration, with a limited number of customers accounting for a substantial portion of our 2024 and 2023 revenues.

We have a limited history

upon which an evaluation of our prospects and future performance can be made and have no history of profitable operations.

We are highly dependent

on the services of key executives, the loss of whom could materially harm our business and our strategic direction.

If we lose key

management or significant personnel, cannot recruit qualified employees, directors, officers, or other personnel or experience increases

in our compensation costs, our business may materially suffer.

We may need to obtain additional

financing to fund our operations.

Our independent registered

accounting firm has expressed concerns about our ability to continue as a going concern.

In the past we have experienced

material weaknesses in our internal control over financial reporting, which if continued, could impair our financial condition.

Relating to Government Laws and Regulations

increases and changes in tax rules may adversely affect our financial results.

may not realize our deferred tax assets in the future.

Environmental

compliance costs and potential environmental liabilities may have a material adverse effect on our financial condition and results

of operations.

agencies may refuse to grant or renew our licenses and permits, thus restricting our ability to operate.

with existing and future climate change and greenhouse gas emission laws and regulations may adversely impact our operating results.

Tax increases and changes

in tax rules may adversely affect our financial results.

We may not realize our

deferred tax assets in the future.

Environmental compliance

costs and potential environmental liabilities may have a material adverse effect on our financial condition and results of operations.

Governmental agencies may

refuse to grant or renew our licenses and permits, thus restricting our ability to operate.

Compliance with existing

and future climate change and greenhouse gas emission laws and regulations may adversely impact our operating results.

Relating to Intellectual Property

may not be able to protect our intellectual property rights throughout the world.

may be involved in lawsuits to protect or enforce our intellectual property, which could be expensive, time-consuming and unsuccessful

and the outcome might have an adverse effect on the success of our business.

may be subject to claims by third parties asserting that our employees or we have misappropriated their intellectual property or

claiming ownership of what we regard as our own intellectual property.

We may not be able to protect

our intellectual property rights throughout the world.

We may be involved in lawsuits

to protect or enforce our intellectual property, which could be expensive, time-consuming and unsuccessful and the outcome might

have an adverse effect on the success of our business.

We may be subject to claims

by third parties asserting that our employees or we have misappropriated their intellectual property or claiming ownership of what

we regard as our own intellectual property.

Related to our Common Stock

market price of our common stock may be volatile and adversely affected by several factors.

our shares of common stock become subject to the penny stock rules, it would become more difficult to trade our shares.

are a “smaller reporting company” within the meaning of the Securities Act, and if we decide to take advantage of certain

exemptions from various reporting requirements applicable to smaller reporting companies, our common stock could be less attractive

to investors.

do not anticipate paying dividends on our common stock, and investors may lose the entire amount of their investment.

could lose some or all of your investment.

management controls a large block of our common stock that will allow them to control us.

we can issue additional shares of Common Stock, purchasers of our Common Stock may incur immediate dilution and experience further

in our Second Amended and Restated Certificate of Incorporation and Amended and Restated Bylaws and Delaware law might discourage,

delay or prevent a change in control of our Company or changes in our management and, therefore, depress the market price of our

Common Stock.

securities or industry research analysts do not publish research or reports about our business, or if they issue unfavorable or misleading

opinions regarding common stock, the market price and trading volume of our Common Stock could decline.

sales and issuances of our Common Stock or rights to purchase our Common Stock, including pursuant to our equity incentive plans,

could result in additional dilution of the percentage ownership of our stockholders and could cause our stock price to fall.

have broad discretion in the use of the net proceeds from our public offerings and may not use them effectively.

disclosure controls and procedures may not prevent or detect all errors or acts of fraud.

a newly Nasdaq-listed company, we will incur material increased costs and become subject to additional regulations and requirements.

The market price of our

common stock may be volatile and adversely affected by several factors.

If our shares of common

stock become subject to the penny stock rules, it would become more difficult to trade our shares.

We are a “smaller

reporting company” within the meaning of the Securities Act, and if we decide to take advantage of certain exemptions from

various reporting requirements applicable to smaller reporting companies, our common stock could be less attractive to investors.

We do not anticipate paying

dividends on our common stock, and investors may lose the entire amount of their investment.

You could lose some or

all of your investment.

Our management controls

a large block of our common stock that will allow them to control us.

Because we can issue additional

shares of common stock, purchasers of our common stock may incur immediate dilution and experience further dilution.

Provisions in our Second

Amended and Restated Certificate of Incorporation and Amended and Restated Bylaws and Delaware law might discourage, delay or prevent

a change in control of our Company or changes in our management and, therefore, depress the market price of our common stock.

If securities or industry

research analysts do not publish research or reports about our business, or if they issue unfavorable or misleading opinions regarding

common stock, the market price and trading volume of our common stock could decline.

Future sales and issuances

of our common stock or rights to purchase our common stock, including pursuant to our equity incentive plans, could result in additional

dilution of the percentage ownership of our stockholders and could cause our stock price to fall.

We have broad discretion

in the use of the net proceeds from our public offerings and may not use them effectively.

Our disclosure controls

and procedures may not prevent or detect all errors or acts of fraud.

If we are unable to satisfy

the applicable continued listing requirements of Nasdaq, our common stock could be delisted

Relating to Our Business and Industry

52 unchanged sentences

Section 232 of the Trade Expansion Act of 1962.

In March 2025, the U.S.

raised tariffs on all imported steel and aluminum products to

25% without exception or exclusion.

These new tariffs, along with other U.S.

trade actions, have triggered retaliatory actions

by certain affected countries, and other foreign governments have initiated or are considering imposing trade measures on other U.S.

For example, China has imposed a series of retaliatory tariffs on certain U.S.

products, including a 25 percent tariff on all

grades of U.S.

scrap and an additional 25 percent tariff on U.S.

trade actions, have triggered retaliatory actions by certain

affected countries, and other foreign governments have initiated or are considering imposing trade measures on other U.S.

example, China has imposed a series of retaliatory tariffs on certain U.S.

products, including a 25% tariff on all grades of U.S.

and an additional 25% on U.S.

aluminum scrap.

These tariffs and other trade actions could result in

a decrease in international steel demand beyond that already experienced and further negatively impact demand for our products, which

would adversely impact our business.

These tariffs and other trade actions could result in a decrease in international steel

demand beyond that already experienced and further negatively impact demand for our products, which would adversely impact our business.

Given the uncertainty regarding the scope and duration of these trade actions by the U.S.

countries, the impact of the trade actions on our operations or results remains uncertain, but this impact could be material.

or other countries, the impact of the trade

actions on our operations or results remains uncertain, but this impact could be material.

in the availability or price of inputs such as raw materials and end-of-life vehicles could reduce our sales.

38 unchanged sentences

at a slower rate than metal purchase prices.

instance, in fiscal 2020, weaker market conditions for recycled metals, including as a result of the sharp decline in global economic

conditions during the third quarter of fiscal 2020 in large part due to the impacts of the COVID-19 pandemic, and structural changes

to the market for certain recycled nonferrous products primarily from Chinese import restrictions and tariffs, resulted in periods of

sharply declining commodity prices and lower average net selling prices for our ferrous and nonferrous recycled metal products compared

to fiscal 2019.

As a result, operating margins in fiscal 2020 compressed as the decline in average net selling prices for our recycled

metal products outpaced the reduction in purchase costs for raw materials.

In fiscal 2021, prices for our ferrous and non-ferrous metals

increased significantly, resulting in an increase in revenue and purchasing costs for raw materials.

In fiscal 2022, prices for our ferrous

and non-ferrous metals declined during the second half of the year, but remained historically strong, resulting in a decrease in revenue

and purchasing costs for raw materials.

in supply and demand conditions in the global steel industry may reduce demand for our products.

25 unchanged sentences

effect on our financial condition and results of operations.

may be unable to renew facility leases, thus restricting our ability to operate.

We lease a significant portion of our facilities.

The cost to renew such leases may increase significantly, and we may not be able to renew such leases on same or commercially reasonable

terms, if not at all.

Failure to renew these leases or timely find suitable alternative locations for our facilities may impact our ability

to continue operations within certain geographic areas, which could have a material adverse effect on our financial condition, results

of operations and cash flows.

in the value of the U.S.

71 unchanged sentences

currently derive a significant portion of our revenues from three large corporate customers.

For the fiscal year ended December 31, 2023,

two certain large customers individually accounted for $20,716,044 and $2,001,847 or approximately 58.08% and 5.61% of our revenues,

respectively.

For the fiscal year ended December 31, 2022, three certain large customers individually accounted for $17,962,176, $5,332,834,

and $4,301,328, or approximately 53%, 16%, and 13% of our revenues, respectively.

The Company has a concentration of customers.

For the fiscal year ended December 31, 2024, two large customers individually accounted for $18,654,928 and $1,683,325, or approximately

55.99% and 5.05% of our revenues, respectively.

For the fiscal year ended December 31, 2023, two large customers individually accounted

for $20,716,044 and $2,001,847, or approximately 58.08% and 5.61% of our revenues, respectively.

are inherent risks whenever a large percentage of total revenues are concentrated with a limited number of customers.

24 unchanged sentences

increases in our compensation costs, our business may materially suffer.

are highly dependent on our management team, specifically our Chief Executive Officer, Danny Meeks.

While we have an employment agreement

with Danny Meeks, such employment agreement permits Mr.

are highly dependent on our management team, specifically our Chief Executive Officer and Acting Chief Financial Officer, Danny Meeks.

While we have an employment

agreement with Danny Meeks, such employment agreement permits Mr.

Meeks to terminate such agreement upon notice.

If we lose key employees, our

business may suffer.

Furthermore, our future success will also depend in part on the continued service of our key management personnel

and our ability to identify, hire, and retain additional personnel.

We carry “key-man” life insurance on the life of our

executive officer.

We experience intense competition for qualified personnel and may be unable to attract and retain the personnel necessary

for the development of our business.

Because of this competition, our compensation costs may increase significantly.

If we lose key

employees, our business may suffer.

Furthermore, our future success will also depend in part on the continued service of our key

management personnel and our ability to identify, hire, and retain additional personnel.

We carry “key-man” life

insurance on the life of our executive officer.

We experience intense competition for qualified personnel and may be unable to

attract and retain the personnel necessary for the development of our business.

Because of this competition, our compensation costs

may increase significantly.

may need to obtain additional financing to fund our operations.

57 unchanged sentences

and other countries relating to, among other matters:

water and storm water management, treatment and discharge;

use and treatment of groundwater;

and groundwater contamination and remediation;

discharge, storage, handling and disposal of hazardous materials and secondary materials;

health and safety.

Waste disposal;

Air emissions;

Waste water and storm water

management, treatment and discharge;

The use and treatment of

Soil and groundwater contamination

and remediation;

Climate change;

Generation, discharge,

storage, handling and disposal of hazardous materials and secondary materials;

Employee health and safety.

are also required to obtain environmental permits from governmental authorities for certain operations.

86 unchanged sentences

However, indemnification may be unavailable or

insufficient to cover our costs and losses, depending on our use of the technology, whether we choose to retain control over conduct of

the litigation, and other factors.

insufficient to cover our costs and losses, depending on our use of the technology, whether we choose to retain control over conduct

of the litigation, and other factors.

In addition, we may have to find substitute to keep using similar technology to our products, which

may be time-consuming and costly, if not impossible, upon such period our sales or manufacture of certain products may be negatively influenced.

may be time-consuming and costly, if not impossible, upon such period our sales or manufacture of certain products may be negatively

Relating to Ownership of our Common Stock

68 unchanged sentences

of April 2, 2025, members of our management team beneficially own approximately 4.24% of our outstanding common stock.

Further, there

are 450,000 shares of Series A-1 Convertible Preferred Voting Stock owned by an entity controlled by the Company’s Chairman and

Chief Executive Officer which are, in the aggregate, convertible into and have voting weight equal to 45% of the number of common shares

a result, management may have the ability to control substantially all matters submitted to our stockholders for approval including:

and removal of our directors;

of our Second Amended and Restated Certificate of Incorporation or Amended and Restated Bylaws;

of measures that could delay or prevent a change in control or impede a merger, takeover or other business combination involving

Election and removal of

our directors;

Amendment of our Second

Amended and Restated Certificate of Incorporation or Amended and Restated Bylaws;

Adoption of measures that

could delay or prevent a change in control or impede a merger, takeover or other business combination involving us.

addition, management’s stock ownership may discourage a potential acquirer from making a tender offer or otherwise attempting to

3 unchanged sentences

are authorized to issue up to 1,200,000,000 shares of common stock, of which 57,169,509 shares of common stock are issued and outstanding

as of April 9, 2024.

Our Board of Directors has the authority to cause us to issue additional shares of Common Stock without consent

of any of stockholders.

Consequently, our stockholders may experience further dilution in their ownership of our stock in the future,

which could have an adverse effect on the trading market for our Common Stock.

as of March 28, 2025.

Further, there are 450,000 shares of Series A-1 Convertible Preferred Voting Stock owned by an entity controlled

by the Company’s Chairman and Chief Executive Officer which are, in the aggregate, convertible into and have voting weight equal

to 45% of the number of common shares outstanding.

Our Board of Directors has the authority to cause us to issue additional shares of

common stock without consent of any of stockholders.

Consequently, our stockholders may experience further dilution in their ownership

of our stock in the future, which could have an adverse effect on the trading market for our common stock.

in our Second Amended and Restated Certificate of Incorporation and Amended and Restated Bylaws and Delaware law might discourage, delay

48 unchanged sentences

due to error or fraud may occur and not be detected.

As a newly Nasdaq-listed company, we will incur material increased costs and become subject to additional regulations and requirements.

a newly Nasdaq-listed public company, we will incur material additional legal, accounting and other expenses including recruiting and

retaining qualified independent directors, payment of annual Nasdaq fees, and satisfying Nasdaq’s standards for companies listed

Because our common stock is listed on the Nasdaq, we must meet certain financial and liquidity criteria to maintain such listing.

If we violate Nasdaq’s listing requirements, our common stock may be delisted.

If we fail to meet any of the Nasdaq’s listing

standards, our common stock may be delisted.

In addition, our Board may determine that the cost of maintaining our listing on a national

securities exchange outweighs the benefits of such listing.

A delisting of our common stock from Nasdaq may materially impair our stockholders’

ability to buy and sell our common stock and could have an adverse effect on the market price of, and the efficiency of the trading market

for, our common stock.

The delisting of our common stock could significantly impair our ability to raise capital and the value of your

we are unable to satisfy the applicable continued listing requirements of Nasdaq, our common stock could be delisted.

September 13, 2024, the Company received the Notice from Nasdaq notifying the Company that it was not in compliance with the Minimum

Bid Price Requirement, as the closing bid price of the Company’s common stock had been below $1.00 per share for 30 consecutive

business days.

The Notice indicated that the Company has 180 calendar days, or until March 12, 2025, to regain compliance with the Minimum

Bid Price Requirement.

March 13, 2025, Nasdaq notified the Company that although the Company has not regained compliance with the Minimum Bid Price Requirement,

the Company is eligible to receive an additional 180 calendar day period or until September 8, 2025, to regain compliance with the Minimum

Bid Price Requirement, pursuant to Nasdaq Listing Rule 5810(a)(3)(A).

If, at any time during this additional compliance period, the closing

bid price of the Company’s common stock is at least $1.00 per share for a minimum of 10 consecutive business days, Nasdaq will

provide written confirmation of compliance, and this matter will be closed.

If compliance cannot be demonstrated by September 8, 2025,

Nasdaq will provide written notification that the Company’s securities will be delisted.

At that time, the Company may appeal Nasdaq’s

determination to a Nasdaq Hearings Panel.

Company is currently monitoring the closing bid price of its common stock and will consider available options, including a reverse stock

split, if appropriate, to regain compliance with the Minimum Bid Price Requirement by September 8, 2025.

There can be no assurance that

the Company will be able to regain compliance with the Minimum Bid Price Requirement, even if it maintains compliance with other listing

requirements of the Nasdaq Capital Market.

Although we anticipate complying with Nasdaq’s Listing Rules going forward, there can

be no assurance that we will be able to meet continued listing requirements in the future.

In determining whether to afford a company

a cure period prior to commencing suspension or delisting procedures, Nasdaq analyzes all relevant facts including any past deficiencies,

and thus our prior deficiencies could be used as a factor by Nasdaq in any future decision to delist our securities from trading on its

our common stock is delisted, it could reduce the price of our common stock and the levels of liquidity available to our stockholders.

In addition, the delisting of our common stock could materially adversely affect our access to the capital markets and any limitation

on liquidity or reduction in the price of our common stock could materially adversely affect our ability to raise capital.

from Nasdaq could also result in other negative consequences, including the potential loss of confidence by suppliers, customers and

employees, the loss of institutional investor interest and fewer business development opportunities.

to the recent implementation of the Reverse Stock Split, the liquidity of our common stock may be adversely effected.

conducted a one-for-one hundred fifty (1:150) reverse stock split of our common stock that we effectuated with an effective time of 11:59

Eastern Time on May 31, 2024 (the “Reverse Stock Split”).

Our common stock began trading on Nasdaq on a split-adjusted

basis beginning at the open of the market on June 3, 2024.

The liquidity of the shares of our common stock may be affected adversely

by any reverse stock split given the reduced number of shares of our common stock that are outstanding following the Reverse Stock Split,

especially if the market price of our common stock does not increase as a result of the Reverse Stock Split.

Following the Reverse Stock

Split, the resulting market price of our common stock may not attract new investors and may not satisfy the investing requirements of

those investors.

Although we believe that a higher market price of our common stock may help generate greater or broader investor interest,

there can be no assurance that the Reverse Stock Split resulted in a share price that will attract new investors, including institutional

In addition, there can be no assurance that the market price of our common stock will satisfy the investing requirements of

those investors.

As a result, the trading liquidity of our common stock may not necessarily improve.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors