What changed in this filing

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Item 1A. Risk Factors

2026-03-12 compared with 2025-03-07 · 84 added, 77 removed, 296 unchanged (35% of the section changed)

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are primarily dependent on one product line for most of our sales.

of our sales are derived from the sale of TracPipe ® and CounterStrike ® CSST systems, including Autoflare ®

fittings and a variety of accessories.

Sales of our flexible metal hose for other applications represent a small portion of our

overall sales and income.

of our sales are derived from the sale of TracPipe ® and CounterStrike ® flexible gas piping systems, including

Autoflare ® fittings and a variety of accessories.

Sales of our flexible metal hose for other applications represent a

smaller portion of our overall sales and income.

Any event or circumstance that adversely affects our TracPipe ® or CounterStrike ®

CSST could have a greater impact on our business and financial results than if our business were more evenly distributed across several

different product lines.

The effects of such an adverse event or circumstance would be magnified in terms of our company as a whole as

compared to one or more competitors whose product lines may be more diversified, or who are not as reliant on the sales generated by

their respective flexible gas piping products.

flexible gas piping could have a greater impact on our business and financial results than if our business were more evenly distributed

across several different product lines.

The effects of such an adverse event or circumstance would be magnified in terms of our company

as a whole as compared to one or more competitors whose product lines may be more diversified, or who are not as reliant on the sales

generated by their respective flexible gas piping products.

Therefore, risks relating to our TracPipe ® and CounterStrike ®

CSST business – in particular, loss of distributors or sales channels, technological changes, loss of our key personnel involved

in the flexible gas piping product line, increases in commodity prices, particularly in stainless steel, copper, and polyethylene –

could damage our business, competitive position, results of operations or financial condition.

flexible gas piping business – in particular, loss of distributors or sales channels, technological changes, loss of our

key personnel involved in the flexible gas piping product line, increases in commodity prices, including tariffs on foreign exports,

particularly in stainless steel, copper, and polyethylene – could damage our business, competitive position, results of operations

or financial condition.

face intense competition in all our markets.

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are more effective, or which may cost less than our current or future products or could potentially render our products noncompetitive

Volumes of competing low price imports has increased, and may continue to increase, negatively affecting our earnings.

prior success has been due to our ability to develop new products and product improvements and establish and maintain an effective distribution

network, which to some extent came at the expense of several competing manufacturers.

Our business, competitive position, results of

operations or financial condition could be negatively impacted if we are unable to maintain and develop our competitive products.

Volumes of competing low price imports have increased, and may continue to increase, negatively affecting our earnings.

Our prior success has been due to our ability to develop new products and product improvements and to establish and maintain an effective

distribution network, which to some extent came at the expense of several competing manufacturers.

Our business, competitive position,

results of operations or financial condition could be negatively impacted if we are unable to maintain and develop our competitive products.

may not retain our independent sales organizations.

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international sales subject us to additional risks that can adversely affect our business, operating results, and financial condition.

2024 and 2023, we derived 3% to 4% of our revenue from sales to customers located outside the U.S.

Our ability to convince customers

to expand their use of our products or renew their agreements with us is directly correlated to our direct engagement with such customers.

To the extent that we are unable to engage with non-U.S.

customers effectively, we may be unable to grow sales to international customers

to the same degree we have experienced in the past.

2025 and 2024, we derived 3% of our revenue from sales to customers located outside the U.S.

Our ability to convince customers to expand

their use of our products or renew their agreements with us is directly correlated to our direct engagement with such customers.

extent that we are unable to engage with non-U.S.

customers effectively, we may be unable to grow sales to international customers to

the same degree we have experienced in the past.

international operations are subject to a variety of risks and challenges, including:

economic or geopolitical conditions in each country or region;

effects of a widespread outbreak of an illness or disease, or any other public health crisis, including the COVID-19 pandemic, in

each country or region;

effects of a widespread outbreak of an illness or disease, or any other public health crisis,

including COVID-19, in each country or region;

uncertainty around the world;

with laws and regulations imposed on foreign operations, including the U.S.

Foreign Corrupt Practices Act, the U.K.

import and export control laws, tariffs, trade barriers, economic sanctions and other regulatory or contractual limitations on our

ability to sell our products in certain foreign markets, and the risks and costs of non-compliance.

Foreign Corrupt

Practices Act, the U.K.

Bribery Act, import and export control laws, tariffs, trade barriers,

economic sanctions and other regulatory or contractual limitations on our ability to sell

our products in certain foreign markets, and the risks and costs of non-compliance.

example, in response to the continuing conflict between Russia and Ukraine, the U.S.

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where we lease a manufacturing facility.

On a smaller scale we

also have manufacturing operations in Houston, Texas.

We do not have any operational manufacturing capacity for flexible metal hose outside

of these locations.

We cannot replicate our manufacturing methods at a supplier’s facility due to the confidential and proprietary

nature of our manufacturing process.

If one of the manufacturing facilities were destroyed or damaged in a significant manner or otherwise

disrupted for more than a short time, we would likely experience a delay or some interruption of our flexible metal hose operations.

This could lead to a reduction in sales volume if customers were to purchase their requirements from our competitors, claims for breach

of contract by certain customers with contracts for delivery of flexible metal hose by a certain date, and costs to replace our destroyed

or damaged manufacturing capacity.

The fittings and accessories for the flexible metal hose are manufactured for us by suppliers not

located at our manufacturing facilities, and we also have outside warehouses which contain finished goods inventory.

Disruption of or

damage to our supply of these items could damage our business, competitive position, results of operations or financial condition.

We also have manufacturing

operations in Houston, Texas.

We do not have any operational manufacturing capacity for flexible metal hose outside of these locations.

We cannot replicate our manufacturing methods at a supplier’s facility due to the confidential and proprietary nature of our manufacturing

If one of the manufacturing facilities were destroyed or damaged in a significant manner or otherwise disrupted for more than

a short time, we would likely experience a delay or some interruption of our flexible metal hose operations.

This could lead to a reduction

in sales volume if customers were to purchase their requirements from our competitors, claims for breach of contract by certain customers

with contracts for delivery of flexible metal hose by a certain date, and costs to replace our destroyed or damaged manufacturing capacity.

The fittings and accessories for the flexible metal hose are manufactured for us by suppliers not located at our manufacturing facilities,

and we also have outside warehouses which contain finished goods inventory.

Disruption of or damage to our supply of these items could

damage our business, competitive position, results of operations or financial condition.

are dependent on certain raw materials and supplies that could be subject to volatile price escalation .

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We attempt to limit the effects of volatile raw material prices, and to ensure adequate and timely supply of material, by

committing to annual purchase contracts for the bulk of our steel and polyethylene requirements, and for our fitting requirements.

contracts typically represent a significant portion of our annual planned usage and are set at a designated fixed price or a range of

These agreements sometimes require us to accept delivery of the commodity in the quantities committed, at the agreed upon prices.

committing to annual purchase contracts, when market conditions allow, for the bulk of our steel and polyethylene requirements, and for

our fitting requirements.

The contracts typically represent a significant portion of our annual planned usage and are set at a designated

fixed price or a range of prices.

These agreements sometimes require us to accept delivery of the commodity in the quantities committed,

at the agreed upon prices.

Transactions in excess of the pre-arranged commitments are conducted at current market prices at our discretion.

We have identified multiple

qualified vendors to produce or manufacture our critical purchase requirements.

Although we tend to rely on more than one source for

each or our primary components to leverage the relationship and pricing, there is no assurance that we would be able to eliminate all

or most of the adverse effects of a sudden increase in the cost of materials or key components, or that the loss of one or more of our

key sources would not lead to higher costs or a disruption in our business, which could damage our business, competitive position, results

of operations or financial condition.

We have identified multiple qualified vendors to produce or manufacture our critical purchase requirements.

Although we tend to rely

on more than one source for each or our primary components to leverage the relationship and pricing, there is no assurance that we would

be able to eliminate all or most of the adverse effects of a sudden increase in the cost of materials or key components, or that the

loss of one or more of our key sources would not lead to higher costs or a disruption in our business, which could damage our business,

competitive position, results of operations or financial condition.

we were to lose the services of one or more members of our senior management team, we may not be able to execute our business strategy.

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to litigation and significant legal costs or settlements.

the ordinary and normal conduct of our business, we are subject to periodic lawsuits, investigations, and claims (collectively, the “Claims”).

We have continued to receive repeat pattern Claims relating to our flexible gas piping products, although the pace of new Claims has

generally declined.

While we do not believe the Claims have legal merit, and have successfully defended against such Claims, we cannot

predict whether the pace of Claims will increase or subside.

Any significant increase in the number of Claims, the financial magnitude

of Claims brought against us, the costs of defending the Claims, particularly under higher retentions of our current product liability

insurance policies, could have a detrimental and material impact on our business, competitive position, results of operations or financial

the ordinary and normal conduct of our business, we are subject to lawsuits, investigations, and claims (collectively, “Claims”).

The Claims generally relate to alleged lightning or other electrical damage to our flexible gas piping products and may result in legal

and product liability related expenses.

The Company does not believe the Claims have legal merit and vigorously defends them.

have successfully defended against such Claims and the pace of new Claims has generally declined, we cannot predict the volume or severity

of Claims that will be brought against us in the future, or the magnitude of the related expenses we will incur.

Any significant increase

in the number of Claims, in the financial magnitude of Claims, or in the costs of defending Claims, or higher retentions under our product

liability insurance policies, or our decision to self-insure most product liability Claims made for our yellow-jacketed TracPipe ®

CSST on or after September 1, 2025, could have a detrimental and material impact on our business, competitive position, results of operations

or financial condition.

we are not able to protect our intellectual property rights, we may not be able to compete as effectively.

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on such financing raise the acquisition cost of the potential purchaser.

Interest rates have been increasing and there is no guarantee

that they will not continue to increase in the future.

If costs continue to increase, a higher number of potential buyers may not be

able to support the level of financing under a higher interest rate environment.

Increased acquisition costs may lead to a continued

decline in the demand for new or remodeled construction, and as a result may also lead to a continued, reduced demand for our products

used in the construction industry, which could damage our business, competitive position, results of operations or financial condition.

There is no guarantee that interest rates will not increase

in the future.

If interest rates increase, potential buyers may not be able to support the level of financing under a higher interest

rate environment.

Increased acquisition costs may lead to a decline in the demand for new or remodeled construction, and as a result

may also lead to reduced demand for our products used in the construction industry, which could damage our business, competitive position,

results of operations or financial condition.

business may be subject to cyclical demands.

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currencies, and experience unfavorable results due to the translation of financial statements with a lower exchange rate.

fourth quarter of 2024, the U.S.

Dollar strengthened relative to the value of the BP, Euro and CAD partly due to the results of the U.S.

This in turn had a direct negative impact on the Company’s financial statements and results.

Going forward, it is possible

that the BP, Euro, CAD, and other currencies that we engage in may materially impact on our financial position, operations, or liquidity.

the BP, Euro and CAD strengthened relative to the value of the U.S.

This in turn had a direct positive impact on the Company’s

financial statements and results.

Going forward, it is possible that the BP, Euro, CAD, and other currencies that we engage in may materially

impact on our financial position, operations, or liquidity.

cybersecurity incident or other technology disruption could harm us.

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other general and macroeconomic issues may impact the business.

wars, natural disasters, infectious disease outbreaks (such as COVID-19 pandemic), active shooter or other workplace violence, or terrorist

acts could also cause significant damage or disruption to our operations, employees, facilities, systems, suppliers, supply chain, distributors,

resellers, or customers in the U.S.

and internationally for extended periods of time and could also affect demand for our products.

wars, natural disasters, infectious disease outbreaks (such as the COVID-19 pandemic), active shooter or other workplace violence, or

terrorist acts could also cause significant damage or disruption to our operations, employees, facilities, systems, suppliers, supply

chain, distributors, resellers, or customers in the U.S.

and internationally for extended periods of time and could also affect demand

for our products.

Associated with Our Common Stock

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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