What changed in this filing

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Item 1A. Risk Factors

2025-11-13 compared with 2025-08-14 · 105 added, 184 removed, 5 unchanged (98% of the section changed)

Factors that could cause

our actual results to differ materially from those in this Quarterly Report are any of the risks described below and those described

in “Part I, Item 1A.

Risk Factors” in the Form 10-K.

Any of these factors could result in a significant or material adverse

effect on our results of operations or financial condition.

Additional risk factors not presently known to us or that we currently deem

immaterial may also impair our business or results of operations.

As of the date of this Quarterly Report, other than as set forth below,

there were no material changes to the risks and uncertainties described in the section titled “Risk Factors” in Part I, Item

1A of the Form 10-K for our fiscal year ended March 31, 2025.

We have a history of losses, expect to

continue to incur losses in the near term and may not achieve or sustain profitability in the future, and as a result, our management

has identified and our auditors reported that there is a substantial doubt about our ability to continue as a going concern.

For three months ended June

30, 2025 and the years ended March 31, 2025 and 2024, our operating loss was $3.7 million, $15.9 million and $8.7 million, respectively.

We intend to rely on debt and equity financing for working capital until positive cash flows from operations can be achieved, which may

Factors that could cause our actual results to differ materially from those

in this Quarterly Report are any of the risks described below and those described in “Part I, Item 1A.

Risk Factors” in the

Form 10-K and “Part II, Item 1A.

Risk Factors” in the Form 10-Q for the quarter ended June 30, 2025.

Any of these factors

could result in a significant or material adverse effect on our results of operations or financial condition.

Additional risk factors

not presently known to us or that we currently deem immaterial may also impair our business or results of operations.

As of the date of

this Quarterly Report, other than as set forth below, there were no material changes to the risks and uncertainties described in the section

titled “Risk Factors” in Part I, Item 1A of the Form 10-K for our fiscal year ended March 31, 2025 and in Part II, Item 1A

of the Form 10-Q for our quarter ended June 30, 2025.

have a history of losses, expect to continue to incur losses in the near term and may not achieve or sustain profitability in the future,

and as a result, our management has identified and our auditors reported that there is a substantial doubt about our ability to continue

as a going concern.

For six months ended September 30, 2025 and the years ended March 31, 2025 and 2024, our operating loss was $4,2

million, $13.8 million and $7.7 million, respectively.

We intend to rely on debt and equity financing for working capital until positive cash flows from operations

can be achieved, which may never occur.

These matters raise substantial doubt about our ability to continue as a going concern.

Based upon our current operating

plan and assumptions, we expect that our existing cash balances and expected cash flows from operations, alongside the continuance of

our existing financing arrangements, will be sufficient to fund our operations for at least the next 12 months, excluding financing to

support production (i.e.

upon our current operating plan and assumptions, we expect that our existing cash balances and expected cash flows from operations, alongside

the continuance of our existing financing arrangements, will be sufficient to fund our operations for at least the next 12 months, excluding

financing to support production (i.e.

timing of working capital).

However, our operating plan may change, and our assumptions may prove to be wrong,

as a result of many factors currently unknown to us, and we could use our available capital resources sooner than we expect.

to seek additional funds sooner than planned, through public or private equity or debt financings or other third-party funding or a combination

of these approaches.

Even if we believe we have sufficient funds for our current or future operating plans, we may seek additional capital

if market conditions are favorable or based upon specific strategic considerations.

Any additional capital-raising

efforts may divert our management’s attention from the operation of our business.

In addition, we cannot guarantee that future

financing will be available in sufficient amounts or on terms acceptable to us, if at all.

If we are unable to obtain sufficient amounts

of additional capital, when and if we require it, we may be required to reduce the scope of our operations, which could harm our business,

financial condition and results of operations.

Our consolidated financial statements do not include any adjustments that might result

from the outcome of these uncertainties.

The report of our independent

registered public accounting firm that accompanies our audited consolidated financial statements for the fiscal years ended March 31,

2025 and March 31, 2024 contains a going concern explanatory paragraph in which such firm stated that there is substantial doubt about

our ability to continue as a going concern.

Our consolidated financial statements contained in this quarterly report do not include any adjustments

that might result if we are unable to continue as a going concern.

If we are unable to continue as a going concern, holders of our securities

might lose their entire investment.

These factors, among others, may make it difficult to raise any additional capital and may cause

us to be unable to continue to operate our business.

Our financial results and ability to grow

our business may be negatively impacted by global events beyond our control.

We operate distribution and

warehousing facilities and offices around the world and substantially all of our manufacturers are located outside of the United States.

We are subject to numerous risks and global events beyond our control which could negatively impact consumer spending or our own operations

or operations of our customers or business partners, and therefore our results of operations, including:

changes in diplomatic and trade

relationships, trade policy or actions of foreign or U.S.

governmental authorities impacting trade and foreign investment;

However, our operating plan may change, and our assumptions may prove

to be wrong, as a result of many factors currently unknown to us, and we could use our available capital resources sooner than we expect.

We may need to seek additional funds sooner than planned, through public or private equity or debt financings or other third-party funding

or a combination of these approaches.

Even if we believe we have sufficient funds for our current or future operating plans, we may seek

additional capital if market conditions are favorable or based upon specific strategic considerations.

additional capital-raising efforts may divert our management’s attention from the operation of our business.

In addition, we cannot

guarantee that future financing will be available in sufficient amounts or on terms acceptable to us, if at all.

If we are unable to

obtain sufficient amounts of additional capital, when and if we require it, we may be required to reduce the scope of our operations,

which could harm our business, financial condition and results of operations.

Our consolidated financial statements do not include any

adjustments that might result from the outcome of these uncertainties.

report of our independent registered public accounting firm that accompanies our audited consolidated financial statements for the fiscal

years ended March 31, 2025 and March 31, 2024 contains a going concern explanatory paragraph in which such firm stated that there is

substantial doubt about our ability to continue as a going concern.

Our consolidated financial statements contained in this quarterly

report do not include any adjustments that might result if we are unable to continue as a going concern.

If we are unable to continue

as a going concern, holders of our securities might lose their entire investment.

These factors, among others, may make it difficult

to raise any additional capital and may cause us to be unable to continue to operate our business.

financial results and ability to grow our business may be negatively impacted by global events beyond our control.

operate distribution and warehousing facilities and offices around the world and substantially all of our manufacturers are located outside

of the United States.

We are subject to numerous risks and global events beyond our control which could negatively impact consumer spending

or our own operations or operations of our customers or business partners, and therefore our results of operations, including:

in diplomatic and trade relationships, trade policy or actions of foreign or U.S.

governmental authorities impacting trade and foreign

military conflict;

1 unchanged sentence

public health crises, disease epidemics or pandemics;

natural disasters and

extreme weather conditions, which may increase in frequency and severity due to climate change;

economic instability resulting in the

disruption of trade from foreign countries;

the imposition of new laws, regulations and rules, including those relating to sustainability

and climate change, data privacy, labor conditions, minimum wage, quality and safety standards and disease epidemics or other public

health concerns;

and changes in local economic conditions in countries where our stores, customers, manufacturers and suppliers are located.

These risks could hamper

our ability to sell products, negatively affect the ability of our manufacturers to produce or deliver our products or procure materials

and increase our cost of doing business generally, any of which could have an adverse effect on our results of operations, profitability,

cash flows and financial condition.

In the event that one or more of these factors make it undesirable or impractical for us to conduct

business in a particular country, our business could be adversely affected.

We rely on a limited number of third-party

suppliers to provide high quality raw materials.

Our products require high

quality raw materials, including down, softshell, wool, neoprene, and cotton.

We do not manufacture our products or the raw materials

for them and rely instead on suppliers.

Many of the specialty fabrics used in our products are technically advanced textile products

developed and manufactured by third parties and may be available, in the short-term, from only one or a limited number of sources.

have no long-term contracts with any of our suppliers or manufacturers for the production and supply of our raw materials and products,

and we compete with other companies for fabrics, other raw materials, and production.

During the three months ended

June 30, 2025 and the year ended March 31, 2025, our largest single manufacturer, produced approximately 100% and 39% of our products,

respectively, and substantially all of our products were manufactured in China.

For the three months ended June 30, 2025 and the year

ended March 31, 2025, the largest single supplier, produced approximately 56% and 46% of the fabric for our products, respectively.

the three months ended June 30, 2025 and the year ended March 31, 2025, approximately 3% and 37% of our fabrics originated from Japan,

respectively, and 84% and 62% from China, respectively.

We also source other raw materials which are used in our products, including

items such as content labels, elastics, buttons, clasps and drawcords from suppliers located predominantly in the Asia Pacific region.

The price of raw materials

depends on a wide variety of factors largely beyond the control of the Company.

A shortage, delay or interruption of supply for any reason,

could negatively impact our ability to fulfill orders and have an adverse impact on our financial results.

In addition, while our suppliers,

in turn, source from a number of sub-suppliers, we rely on a very small number of direct suppliers for certain raw materials.

any disruption to these relationships could have an adverse effect on our business.

Events that adversely affect our suppliers could

impair our ability to obtain inventory in the quantities and at the quality that we require.

Such events include difficulties or problems

with our suppliers’ businesses, finances, labor relations, ability to import raw materials, costs, production, insurance and reputation,

as well as natural disasters, public health emergencies or other catastrophic occurrences.

A significant slowdown in the retail industry

as a whole may also result in bankruptcies or permanent closures of some of our suppliers and third-party vendors.

Furthermore, there

can be no assurance that our suppliers will continue to provide fabrics and raw materials or provide products that are consistent with

our standards.

More generally, if we need to replace an existing supplier, additional supplies or additional manufacturing capacity may

not be available when required on terms that are acceptable to us, or at all, and any new supplier may not meet our strict quality requirements.

In the event we are required to find new sources of supply, we may encounter delays in production, inconsistencies in quality and added

costs as a result of the time it takes to train our suppliers and manufacturers in our methods, products and quality control standards.

Any delays, interruption or increased costs in the supply of our raw materials could have an adverse effect on our ability to meet customer

demand for our products and result in lower revenue and profitability both in the short and long-term.

We are exposed to risks with respect to

our global operations.

We operate on a global scale

and could be affected by currency and interest rate fluctuations;

capital and exchange controls;

local and global economic conditions

including inflation, recession, volatility and/or lack of liquidity in capital markets;

expropriation and other restrictive government

changes in intellectual property;

legal protections and remedies;

trade regulations;

tax laws and regulations;

procedures and actions affecting approval, production, pricing, and marketing of our products, as well as impacts of political or civil

unrest or military action, including the ongoing conflicts between Russia and Ukraine and in the Middle East and their economic consequences,

geopolitical instability, terrorist activity, unstable governments and legal systems, inter-governmental disputes, public health outbreaks,

epidemics, pandemics, natural disasters or disruptions related to climate change.

We continue to monitor the

global trade environment and potential trade conflicts, sanctions and impediments that could impact our business.

If trade restrictions

or tariffs reduce global economic activity, potential impacts could include declining sales;

increased costs;

volatility in foreign exchange

delays or failures in the performance of customers, suppliers and other third parties on whom we may depend for the performance

of our business;

and the risk that our allowance for doubtful accounts may not be adequate.

In addition, issued or future executive orders

or other new or changes in laws, regulations or policy regarding tariffs, could have a material adverse effect on our business and earnings.

The actual impact of the new tariffs on our business is subject to a number of factors including, but not limited to, restrictions on

trade, the effective date and duration of such tariffs, countries included in the scope of tariffs, changes to amounts of tariffs, and

potential retaliatory tariffs imposed by other countries.

We may be unable to source and sell our

merchandise profitably or at all if new trade restrictions are imposed or existing restrictions become more burdensome.

The United States and the

countries in which our products are produced or sold have imposed and may impose additional quotas, duties, tariffs, or other restrictions

or regulations, or may adversely adjust prevailing quota, duty, or tariff levels.

The results of any audits or related disputes regarding

these restrictions or regulations could have an adverse effect on our financial statements for the period or periods for which the applicable

final determinations are made.

Countries impose, modify, and remove tariffs and other trade restrictions in response to a diverse array

of factors, including global and national economic and political conditions, which make it impossible for us to predict future developments

regarding tariffs and other trade restrictions.

Trade restrictions, including tariffs, quotas, embargoes, safeguards, and customs restrictions,

have and could result in a higher cost or restrictions on the importation of the products we sell.

Although we have and may continue

to look for alternative sourcing options, we may not be able to shift production in a timely or cost-effective manner, if at all, from

various countries in which we manufacture our products to offset those costs or restrictions.

Therefore, we may not be able to mitigate

the entire increase to our cost resulting from tariffs and we may not be able to, or may choose not to, pass any cost increase onto consumers.

Any increase in our prices could have an adverse impact on our direct sales to consumers, as well as sales by our wholesale customers.

In addition, the uncertainty in the global trade environment may have adverse impacts on capital markets or consumer discretionary spending,

which could lower demand for our products.

Any adverse impact on our costs or on consumer demand could have a material adverse effect

on our business, financial condition and results of operations.

We are dependent on international

trade agreements and regulations.

The countries in which we produce and sell our products could impose or increase tariffs, duties, or

other similar charges that could negatively affect our results of operations, financial position, or cash flows.

Adverse changes in, or withdrawal

from, trade agreements or political relationships between the United States and the PRC, Europe, Canada, or other countries where we

sell or source our products, could negatively impact our results of operations or cash flows.

General geopolitical instability and the

responses to it, such as the possibility of sanctions, trade restrictions, and changes in tariffs, including sanctions against the PRC,

tariffs imposed by the United States and the PRC, and the possibility of additional tariffs or other trade restrictions, could adversely

impact our business.

It is possible that further tariffs may be introduced or increased.

Such changes could adversely impact our business

and could increase the costs of sourcing our products from the PRC as well as other countries, or could require us to source our products

from different countries.

The Uyghur Forced Labor Prevention Act and other similar legislation may lead to greater supply chain compliance

costs and delays to us and to our vendors.

2 - UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

3 - DEFAULTS UPON SENIOR SECURITIES

4 - MINE SAFETY DISCLOSURES

natural disasters and extreme weather conditions, which may increase in frequency and severity due to climate change;

economic instability

resulting in the disruption of trade from foreign countries;

the imposition of new laws, regulations and rules, including those relating

to sustainability and climate change, data privacy, labor conditions, minimum wage, quality and safety standards and disease epidemics

or other public health concerns;

and changes in local economic conditions in countries where our stores, customers, manufacturers and

suppliers are located.

risks could hamper our ability to sell products, negatively affect the ability of our manufacturers to produce or deliver our products

or procure materials and increase our cost of doing business generally, any of which could have an adverse effect on our results of operations,

profitability, cash flows and financial condition.

In the event that one or more of these factors make it undesirable or impractical

for us to conduct business in a particular country, our business could be adversely affected.

rely on a limited number of third-party suppliers to provide high quality raw materials.

products require high quality raw materials, including down, softshell, wool, neoprene, and cotton.

We do not manufacture our products

or the raw materials for them and rely instead on suppliers.

Many of the specialty fabrics used in our products are technically advanced

textile products developed and manufactured by third parties and may be available, in the short-term, from only one or a limited number

We have no long-term contracts with any of our suppliers or manufacturers for the production and supply of our raw materials

and products, and we compete with other companies for fabrics, other raw materials, and production.

During the six months ended September 30, 2025 and the year ended March

31, 2025, our largest single manufacturer, produced approximately 43% and 39% of our products, respectively, and majority of our products

were manufactured in China.

For the six months ended September 30, 2025 and the year ended March 31, 2025, the largest single supplier,

produced approximately 56% and 46% of the fabric for our products, respectively.

During the six months ended September 30, 2025 and the

year ended March 31, 2025, approximately 3% and 37% of our fabrics originated from Japan, respectively, and 84% and 62% from China, respectively.

We also source other raw materials which are used in our products, including items such as content labels, elastics, buttons, clasps and

drawcords from suppliers located predominantly in the Asia Pacific region.

price of raw materials depends on a wide variety of factors largely beyond the control of the Company.

A shortage, delay or interruption

of supply for any reason, could negatively impact our ability to fulfill orders and have an adverse impact on our financial results.

In addition, while our suppliers, in turn, source from a number of sub-suppliers, we rely on a very small number of direct suppliers

for certain raw materials.

As a result, any disruption to these relationships could have an adverse effect on our business.

adversely affect our suppliers could impair our ability to obtain inventory in the quantities and at the quality that we require.

events include difficulties or problems with our suppliers’ businesses, finances, labor relations, ability to import raw materials,

costs, production, insurance and reputation, as well as natural disasters, public health emergencies or other catastrophic occurrences.

A significant slowdown in the retail industry as a whole may also result in bankruptcies or permanent closures of some of our suppliers

and third-party vendors.

Furthermore, there can be no assurance that our suppliers will continue to provide fabrics and raw materials

or provide products that are consistent with our standards.

More generally, if we need to replace an existing supplier, additional supplies

or additional manufacturing capacity may not be available when required on terms that are acceptable to us, or at all, and any new supplier

may not meet our strict quality requirements.

In the event we are required to find new sources of supply, we may encounter delays in

production, inconsistencies in quality and added costs as a result of the time it takes to train our suppliers and manufacturers in our

methods, products and quality control standards.

Any delays, interruption or increased costs in the supply of our raw materials could

have an adverse effect on our ability to meet customer demand for our products and result in lower revenue and profitability both in

the short and long-term.

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-Q

Item 1A. Risk Factors