1 unchanged sentence
Risks Related to Our Company
−Removed: Our revenues are substantially dependent on ongoing oil and natural gas exploration, development and production activity on or around our facilities and in basins in which we have established trucking operations.
−Removed: If exploration and production companies do not maintain drilling, completion and production activities on or around those areas, the demand for the use of our transportation and facilities, as well as the marketing activities and revenue we obtain related to those businesses, could be reduced, which could have a material adverse effect on our results of operations, cash flows and financial position.
−Removed: We are not an exploration and production company, and we have no control over the oil and natural gas development activity on or around our facilities and assets.
−Removed: The willingness and ability of exploration and production companies to continue development activities on and around our facilities and assets is dependent on a variety of factors that are outside of their and our control, including:
−Removed: the demand for and supply of oil and natural gas;
−Removed: the capital costs required for drilling, completion and production activities, which could be significantly more than anticipated;
−Removed: the ability to access, and cost of, capital
−Removed: prevailing oil and natural gas prices;
−Removed: the availability of suitable drilling equipment, production and transportation infrastructure and qualified operating personnel
−Removed: the producers’ expected return on investment in wells drilled on or around our land as compared to opportunities in other areas;
+Added: Our business is substantially dependent on oil and natural gas exploration, development, and production activity.
+Added: Our revenues are substantially dependent on ongoing oil and natural gas exploration, development, and production activity on or around our facilities and in the basins where we have established trucking and terminaling operations.
+Added: If exploration and production companies do not maintain drilling, completion, and production activities near our facilities, demand for our transportation and terminaling services, as well as our marketing activities, could decline, which could have a material adverse effect on our results of operations, cash flows, and financial position.
+Added: We are not an exploration and production company and have no control over the pace or scope of development activity in the regions where our assets are located.
+Added: The willingness and ability of producers to maintain drilling and production depend on numerous factors beyond our control, including:
+Added: supply and demand dynamics for oil and natural gas;
+Added: the capital costs of drilling, completion, and production activities;
+Added: access to, and the cost of, capital;
+Added: prevailing commodity prices;
+Added: availability of drilling equipment, infrastructure, and qualified personnel;
+Added: expected returns from wells drilled on or near our assets compared to other opportunities;
regulatory developments.
−Removed: The customer agreements we enter into and the petroleum commodities we sell in the marketplace are substantially dependent on drilling, completion and production activities by exploration and production companies near and around our facilities and transportation assets.
−Removed: Similarly, the revenues we earn from White Claw Crude, LLC (“WC Crude” or White Claw”) are substantially dependent on those same activities.
−Removed: White Claw Crude is controlled by James Ballengee, our Chief Executive Officer and member of our Board of Directors.
−Removed: If exploration and production companies do not maintain such activities near our facilities and transportation assets, their demand for the use of assets and transportation logistics services will decline, negatively impacting our results of operations, cash flows and financial position.
−Removed: Demand for the use of our assets, as well as the revenues provided by White Claw, depends substantially on capital spending by producers to develop and produce oil and natural gas in the area.
−Removed: These expenditures are generally dependent on such producers’ overall financial position, capital allocation priorities and ability to access capital, and their views of future demand for, and prices of, oil and natural gas.
−Removed: Volatility in oil or natural gas prices (or the perception that oil or natural gas prices will decrease) affects such producers’ capital expenditures and willingness to pursue development activities.
−Removed: This, in turn, could lead to lower demand for the use of our assets and services, delays in payment of, or nonpayment of, amounts that are owed to us and cause lower rates and lower utilization of our transportation assets, facilities, and may negatively impact our marketing activities.
−Removed: For additional information, please see below, The willingness of exploration and production companies to engage in drilling, completion and production activities on and around our land is substantially influenced by the market prices of oil and natural gas, which are highly volatile.
−Removed: A substantial or extended decline in oil and natural gas prices may adversely affect our results of operations, cash flows and financial position .
−Removed: For the year ended December 31, 2024, on an actual basis, we and the Endeavor Entities received approximately 75.76% of our total revenues from two major customers.
−Removed: While we expect these revenue streams to be recurring, our contracts with our significant customers, which represent a large portion of our revenues, typically do not contain minimum volume commitment provisions for transportation or processing of petroleum commodities or produced water volumes handled.
−Removed: As a result, our revenues are dependent on ongoing demand from these customers, which may decrease due to factors beyond our control.
−Removed: Our producer customers make all decisions as to investments in, and production from, their wells, and our revenues are dependent upon decisions made by such producers, among other factors.
−Removed: For example, we cannot control whether a producer chooses to develop a property or the success of drilling and development activities, which depend on a number of factors under the control of such producer.
−Removed: There can be no assurance that such producers will take actions or make decisions that will be beneficial to us, which could result in adverse effects on our results of operations, cash flows and financial position.
−Removed: The willingness of exploration and production companies to engage in drilling, completion and production activities near our facilities and transportation assets is substantially influenced by the market prices of oil and natural gas, which are highly volatile.
−Removed: A substantial or extended decline in oil and natural gas prices may adversely affect our results of operations, cash flows and financial position.
−Removed: Market prices for oil and natural gas are volatile and a decrease in prices could reduce drilling, completion and production activities by producers on or around our land, resulting in a reduction in the use of transportation and facilities services, as well as the amount of revenues we receive from marketing activities.
−Removed: The market prices for oil and natural gas are subject to U.S.
−Removed: and global macroeconomic and geopolitical conditions, among other things, and, historically, have been subject to significant price fluctuations and may continue to change in the future.
−Removed: Prices for oil and natural gas may fluctuate widely in response to relatively minor changes in supply and demand, market uncertainty and a variety of additional factors that are beyond our control and the control of producers on or around our land, such as:
−Removed: general market conditions, including macroeconomic trends, inflation, elevated interest rates and associated policies of the Federal Reserve;
−Removed: the domestic and foreign supply of and demand for oil and natural gas;
−Removed: the price and quantity of foreign imports and U.S.
−Removed: exports of oil and natural gas;
−Removed: market expectations about future prices of oil and natural gas;
−Removed: oil and natural gas drilling, completion and production activities and the cost of such activities;
−Removed: political and economic conditions and events domestically, including the U.S.
−Removed: presidential and congressional elections in the fall of 2024 election and any resultant political uncertainty, and in foreign oil and natural gas producing countries, including embargoes, increased hostilities in the Middle East, including Iran, and other sustained military campaigns, the Russia-Ukraine war and associated economic sanctions on Russia, as well as the Israel-Hamas conflict, conditions in South America, Central America, China and Russia, and acts of terrorism or sabotage;
−Removed: the ability of and actions taken by members of the Organization of Petroleum Exporting Countries (“ OPEC ”), Russia and other allied producing countries (together with OPEC, “ OPEC+ ”) and other oil-producing nations in connection with their arrangements to maintain oil prices and production controls;
−Removed: the impact on worldwide economic activity of an epidemic, pandemic, outbreak of disease, or other public health event;
−Removed: the level of consumer product demand and efforts to accelerate the transition to a low-carbon economy;
−Removed: weather conditions, such as winter storms, earthquakes, fires, hurricanes, and flooding, and other natural disasters;
−Removed: weather conditions, such as winter storms, earthquakes and flooding, and other natural disasters;
−Removed: U.S., non-U.S., and foreign governmental regulations and energy policy, including environmental initiatives and taxation;
−Removed: changes in global and domestic political and economic conditions, both generally and in the specific markets in which we operate;
−Removed: the effects of litigation;
−Removed: physical, electronic and cybersecurity breaches;
−Removed: shareholder activism or activities by non-governmental organizations to restrict the exploration, development and production of oil and natural gas to minimize emissions of carbon dioxide, a global greenhouse gas;
−Removed: the proximity, cost, availability and capacity of oil and natural gas pipelines and other transportation infrastructure;
−Removed: technological advances affecting energy consumption, energy storage and energy supply;
−Removed: the price and availability of alternative fuels;
−Removed: the impact of energy conservation efforts.
−Removed: These factors have at times resulted in, and may in the future result in, a reduction in global economic activity and volatility in the global financial markets and make it extremely difficult to predict future oil and natural gas price movements with certainty.
−Removed: A sustained decline in oil and natural gas prices may reduce the amount of oil and natural gas that can be produced economically by producers on or around our land, which may reduce such producers’ willingness to develop such land and hire our transportation assets and facilities services.
−Removed: Producers near or around our transportation assets and facilities could also determine during periods of low oil and natural gas prices to shut-in or curtail production from wells on such land, or plug and abandon marginal wells that otherwise may have been allowed to continue to produce for a longer period under conditions of higher prices.
−Removed: The scale and duration of the impact of these factors cannot be predicted but could lead to an increase in our customers’ operating costs or a decrease in our or our customers’ revenues, and any substantial decline in the price of oil and natural gas or prolonged period of low oil and natural gas prices may materially and adversely affect our results of operations, cash flows and financial position.
+Added: Any reduction or delay in such development activity could reduce throughput, limit utilization of our assets, and adversely affect our revenues and results of operations.
+Added: In addition, the customer agreements we enter into and the petroleum commodities we sell are substantially dependent on drilling, completion, and production activity by producers near our facilities and transportation assets.
+Added: A significant portion of our revenue is derived from Jorgan Development, LLC (“Jorgan”), which is controlled by our Chief Executive Officer and director, James Ballengee .
+Added: Any slowdown in producer activity or a change in Jorgan’s business operations could negatively impact our results of operations, cash flows, and financial position.
+Added: revenues are sensitive to fluctuations in oil and natural gas prices.
+Added: Our revenues and results of operations are significantly influenced by market prices for oil and natural gas, which are volatile and largely beyond our control.
+Added: A sustained decline or significant fluctuation in commodity prices could reduce drilling, completion, and production activities by producers on or near our facilities, which in turn could decrease throughput, utilization of our assets, and revenues from marketing activities.
+Added: Factors that may affect oil and natural gas prices include, among others:
+Added: Macroeconomic conditions:
+Added: including global growth trends, inflation, interest rates and monetary policy;
+Added: Supply and demand dynamics including production levels, import and export volumes, and storage inventories;
+Added: Geopolitical events, including actions by OPEC+, Russia, and other producing nations, and political instability or conflict in key regions;
+Added: Regulatory and environmental or tax policy changes;
+Added: Technological and market factors, such as advances in drilling, the availability of alternative fuels, and the transition toward lower-carbon energy;
+Added: Natural or external events such as weather, natural disasters, pandemics, or cybersecurity incidents.
+Added: Prolonged periods of low oil and natural gas prices may lead producers to reduce or delay drilling and production, shut-in wells, or abandon marginal assets, which could materially and adversely affect demand for our services and our financial condition, results of operations, and cash flows.
+Added: Our business is dependent on the oil industry, which is subject to numerous worldwide variables.
+Added: Our customers and prospective customers operate in the oil and gas industry.
+Added: As a result, we will be subject to the success of the oil and gas industry, which is subject to substantial volatility based on numerous worldwide factors.
+Added: A decline in the price of crude oil or natural gas will have a material adverse effect on our business, financial condition, results of operations and cash flows.
+Added: The oil and gas industry is competitive in all its phases.
+Added: Competition in the oil and gas industry is intense.
+Added: Our customers could include competitors such as oil and gas companies that have substantially greater financial resources, staff and facilities than those of our customers and lessees.
+Added: Competitive factors in the distribution and marketing of oil and other hydrocarbon products include price and methods and reliability of delivery.
+Added: Within the oil remediation market, demand for our services will be limited to a specific customer base and highly correlated to the oil and gas industry.
+Added: The oil and gas industry’s demand for equipment is affected by a number of factors including the volatile nature of the oil industry’s business, increased use of alternative types of energy and technological developments in the oil remediation process.
+Added: A significant reduction in the target market’s demand for oil and gas would reduce the demand for the equipment, which would have a material adverse effect upon our business, financial condition, results of operations and cash flows.
+Added: Low oil prices may substantially impact our ability to generate revenues.
+Added: Our business is closely tied to the oil and gas industry, which is subject to substantial volatility.
+Added: Fluctuations in the price of crude oil and natural gas, as well as changes in supply, demand, and market margins, can materially and adversely affect our revenues, operations, and cash flows.
+Added: Low prices or reduced demand for oil and gas could reduce customer investment in drilling and production, limit demand for our services and products, and adversely impact our financial results.
+Added: Our operations are also subject to the hazards inherent in the oil and gas industry, including equipment failures, vehicle accidents, fires, explosions, blowouts, pipeline failures, oil spills, and exposure to hazardous substances.
+Added: In addition, natural disasters, such as blizzards, storms, floods, earthquakes, and other adverse weather events, could damage our assets, disrupt operations, and result in environmental or regulatory liabilities.
+Added: These events could increase operating costs, affect insurability, harm our reputation, or lead customers to reduce or terminate their use of our services.
+Added: Our operations are subject to unforeseen interruptions and hazards inherent in the oil and gas industry, for which we may not be adequately insured and which could cause us to lose customers and substantial revenue.
+Added: While we maintain insurance coverage, it may be inadequate to cover all potential losses or liabilities.
+Added: Certain policies may have sub-limits, exclusions, or escalating premiums, and we may be unable to obtain desired coverage at reasonable rates.
+Added: If we incur significant losses that are not fully insured, or fail to meet insurance requirements, our financial condition, results of operations, and cash flows could be materially and adversely affected.
+Added: A substantial portion of our operating assets are located in the Permian and Eagle Ford Basins, making us vulnerable to risks associated with geographic concentration in two geographic areas.
+Added: A substantial portion of our assets and operations are concentrated in the Permian and Eagle Ford Basins of Texas and New Mexico.
+Added: This geographic concentration exposes us and our customers to regional supply and demand fluctuations, production delays, transportation or processing constraints, natural disasters, adverse weather, water shortages, and regulatory or political developments.
+Added: Such concentration may magnify the impact of these risks and could adversely affect our operations, revenues, and financial performance.
+Added: Finally, the oil and gas industry is highly competitive.
+Added: Our prospective customers may include companies with greater financial, operational, and technical resources than our customers and lessees.
+Added: Competitive factors in the industry include price, delivery reliability, methods, and efficiency.
+Added: Failure to remain competitive could reduce our customer base and materially and adversely affect our business, financial condition, results of operations, and cash flows.
+Added: Low oil prices may negatively impact our ability to operate.
+Added: The demand for our products and services depend, in part, on the price of oil and the margins oil producers receive on the sale of oil.
+Added: Oil prices are volatile and can fluctuate widely based upon a number of factors beyond our control.
+Added: Any decline in the prices of and demand for oil could have a material adverse effect on our business, financial condition, results of operations and cash flows.
+Added: Our primary business is impacted by the oil industry and the manufacturing industry, which are subject to uncertain economic conditions.
+Added: The global economy is subject to fluctuation, and it is unclear how stable the oil industry and the manufacturing industry will be in the future.
+Added: As a result, there can be no assurance that the business will achieve anticipated cash flow levels.
+Added: Further, recent world events evolving out of trade disputes, increased terrorist activities and political and military action in the Middle East and elsewhere, among other events, have created an air of uncertainty concerning the stability of the global economy.
+Added: Historically, such events have resulted in disturbances in financial markets, and it is impossible to determine the likelihood of future events.
+Added: Any negative change in the general economic conditions in the United States and globally could adversely affect the financial condition and operating results of the business.
+Added: We plan to expand our level of operations.
+Added: However, slower economic activity, concerns about inflation or deflation, decreased consumer confidence, reduced corporate profits and capital spending, adverse business conditions and liquidity concerns in the general economy and recent international conflicts and terrorist and military activity have resulted in a downturn in worldwide economic conditions, especially in the United States.
+Added: Political and social turmoil related to international conflicts and terrorist acts may place further pressure on economic conditions in the United States and worldwide.
+Added: These political, social and economic conditions make it extremely difficult for us to accurately forecast and plan future business activities.
+Added: If such conditions continue or worsen, then our business, financial condition and results of operations could be materially and adversely affected.
We may not be successful in pursuing additional commercial opportunities for our facilities and transportation assets.
−Removed: Future growth may place strains on our resources, possibly negatively affecting our results of operations, cash flows and financial position.
+Added: Our future growth may place demands on our financial, operational, and human resources, which could negatively affect our results of operations, cash flows, and financial position.
Our ability to grow will depend on a number of factors, including:
−Removed: investment by our customers in drilling and development area in our core areas of operations;
−Removed: the amount of produced water use and associated prices for such produced water;
−Removed: future and existing limitations imposed by law or environmental regulations;
−Removed: oil and natural gas prices;
−Removed: our ability to develop existing and future projects, including petroleum and produced water processing facilities;
−Removed: our ability to identify and acquire accretive acquisitions;
−Removed: our ability to continue to retain and attract skilled personnel;
−Removed: our ability to maintain or enter into new relationships with customers;
−Removed: our access to, and cost of, capital in the event we pursue future acquisitions.
−Removed: We may also be unable to make attractive acquisitions, which could inhibit our ability to grow, or we could experience difficulty commercializing any acquired assets or facilities.
−Removed: It may be difficult to identify attractive acquisition opportunities and, even if such opportunities are identified, our existing and/or future debt agreements contain, or may contain, limitations on our ability to enter into certain transactions, which could limit our future growth.
+Added: Market and regulatory factors:
+Added: investment by customers in drilling and development in our core areas, oil and natural gas prices, and applicable legal or environmental restrictions;
+Added: Operational and strategic capabilities:
+Added: our ability to develop existing and future projects, including petroleum transportation, processing, and terminaling facilities, and to identify and complete accretive acquisitions;
+Added: Human capital and commercial relationships:
+Added: our ability to attract, retain, and deploy skilled personnel, and to maintain or establish relationships with customers;
+Added: Financial resources:
+Added: access to, and cost of, capital to fund future growth or acquisitions, and limitations under existing or future debt agreements.
+Added: We may also face challenges in making attractive acquisitions or integrating acquired assets and facilities, which could limit our growth prospects.
Our construction of new facilities and infrastructure and successful execution upon our growth plans is subject to regulatory, construction, supply chain and other risks common in the development and operation of facilities and other infrastructure.
−Removed: We intend to grow our business through revenues and contracts tied to newly-constructed facilities.
−Removed: Facility construction projects involve numerous regulatory, environmental, political and legal uncertainties, including political opposition by environmental groups, local groups and other advocates.
−Removed: Such opposition can take many forms, including the delay or denial of required governmental permits, organized protests, attempts to block or sabotage our operations, intervention in regulatory or administrative proceedings related to our permitting efforts or otherwise involving their assets, or lawsuits or other actions designed to prevent, disrupt or delay the operation of our assets or their business.
−Removed: There can be no assurance that such infrastructure will be developed at all or that we will complete these projects on schedule or at an economical cost, and we may not realize the anticipated benefits of such projects.
−Removed: We may also encounter technical difficulties during the construction of such infrastructure leading to a reduction in capacity or a shorter useful life.
−Removed: Moreover, we may undertake expansion projects to capture anticipated future growth that does not materialize or for which they are unable to acquire new customers.
−Removed: As a result, the new facilities and infrastructure developed by us may not be able to attract enough demand to achieve their expected investment return, which could materially and adversely affect our results of operations, cash flows and financial position.
−Removed: In addition, acts of sabotage or eco-terrorism could cause significant damage or injury to people, property or the environment or lead to extended interruptions of operations.
−Removed: Moreover, governmental authorities exercise considerable discretion in the timing and scope of permit issuance and the public may engage in the permitting process, including through intervention in the courts.
−Removed: Negative public perception could cause the permits our customers require to conduct their operations to be withheld, delayed or burdened by requirements that restrict our customers’ ability to profitably conduct their business.
−Removed: Any such event that delays or otherwise interrupts the revenues generated by our operations, or which causes us to make significant expenditures not covered by insurance, could adversely affect our revenue in respect of use of existing transportation and facilities assets as well as our future development of facilities.
−Removed: Technological advancements in connection with alternatives to hydraulic fracturing could decrease the demand for our produced water sales and the Endeavor Entities’ produced water transportation and handling operations.
−Removed: Wide-scale development of techniques to recycle produced water for use in completion activities or otherwise could adversely affect the amount of produced water transported to and handled by our transportation fleet, which could materially and adversely affect our results of operations, cash flows and financial position.
−Removed: Some exploration and production companies are focusing on developing and utilizing non-water fracturing techniques, including those utilizing propane, carbon dioxide or nitrogen instead of water.
−Removed: If producers in the Permian and Eagle Ford Basins begin to shift their fracturing techniques to waterless fracturing in the development of their wells, our produced water transportation business could be materially and negatively impacted.
−Removed: Our RPC services will be at an early operational stage after operations commence, and the success of these services is subject to the substantial risks inherent in the establishment of a new business venture.
−Removed: Our RPC services will be in an early operational stage after operations commence, and our initial operations will focus on the remediation of soil and the extraction of hydrocarbons, such as oil, from properties contaminated by or laden with heavy crude oil and hydrocarbon-based substances.
−Removed: Thereafter, we plan for the second stage of our operational strategy related to our RPCs, which involves the selling the asphaltic cement and/or other petroleum-based products we are able to produce from the hydrocarbons we recover.
−Removed: Our services related to our RPCs may not prove to be successful.
−Removed: We currently have two RPCs in Kuwait but neither are presently engaged in remediation operations and we have fully-impaired the value of these two RPCs in our financial statements as of December 31, 2024.
−Removed: We will need to deploy these two RPC and scale our remediation business beyond these two RPCs and demonstrate that our scaled-up recovery and remediation business can be profitable.
−Removed: Any future success that we may enjoy related to our RPC business will depend on many factors, some of which may be beyond our control, and others which cannot be predicted at this time.
−Removed: We have historically suffered net losses, and we may not be able to sustain profitability.
−Removed: We had an accumulated deficit of approximately $99 million as of December 31, 2024, and we expect to continue to incur significant development expenses in the foreseeable future related to the completion of the development and commercialization of our sites and products.
−Removed: As a result, we are incurring operating and net losses, and it is possible that we may never be able to sustain the revenue levels necessary to achieve and sustain profitability.
−Removed: If we fail to generate sufficient revenues to operate profitably on a consistent basis, or if we are unable to fund our continuing losses, you could lose all or part of your investment.
−Removed: Our financial condition casts doubts about our ability to continue as a going concern.
−Removed: As a result of our financial condition, there is uncertainty regarding our ability to continue as a going concern.
−Removed: To that end, our independent registered public accounting firm for our financial statements for the year ended December 31, 2024 has included an explanatory paragraph describing the uncertainty as to our ability to continue as a going concern.
−Removed: In order to continue as a going concern, we must effectively balance many factors and increase our revenues to a point where we can fund our operations from our sales and revenues.
−Removed: If we are not able to do this, we may not be able to continue as an operating company.
−Removed: We rely upon a few, select key employees who are instrumental in our ability to conduct and grow our business.
−Removed: In the event any of those key employees would no longer be affiliated with the Company, it may have a material detrimental impact as to our ability to successfully operate our business.
+Added: We intend to grow our business partly through revenues and contracts tied to newly constructed facilities.
+Added: Construction projects involve regulatory, environmental, political, and legal uncertainties, including opposition from environmental groups, local communities, and other stakeholders.
+Added: Such opposition may result in delays or denials of permits, organized protests, regulatory challenges, lawsuits, or attempts to disrupt or sabotage operations.
+Added: There can be no assurance that facilities will be developed at all, completed on schedule, or constructed at economical cost, and anticipated benefits may not materialize.
+Added: Technical difficulties during construction may reduce capacity or shorten the useful life of assets.
+Added: Expansion projects may fail to attract sufficient demand or new customers, potentially limiting expected returns and adversely affecting our results of operations, cash flows, and financial position.
+Added: Acts of sabotage or eco-terrorism could cause damage, injury, environmental harm, or operational interruptions.
+Added: Government authorities exercise discretion in permit timing and scope, and public intervention may further delay approvals.
+Added: Negative public perception could restrict our customers’ ability to operate profitably, which in turn could reduce usage of our existing transportation and facilities assets and hinder future development.
+Added: Any such events, or expenditures not covered by insurance, could materially impact our revenue and financial performance.
+Added: Because we rely on a limited number of key employees who are instrumental to our ability to conduct and grow our business, the loss of any of these individuals could materially and adversely affect our ability to successfully operate and expand our business.
Our future success will depend in large part on our ability to attract and retain high-quality management, operations, and other personnel who are in high demand, are often subject to competing employment offers, and are attractive recruiting targets for our competitors.
The loss of qualified executives and key employees, or our inability to attract, retain, and motivate high-quality executives and employees required for the planned expansion of our business, may harm our operating results and impair our ability to grow.
−Removed: We depend on the continued services of our key personnel, including James Ballengee, our Chief Executive Officer, Tyler Nelson, our Chief Financial Officer, Russ Shelton, our Executive Vice President and Chief Operating Officer, and Pat Knapp, our Executive Vice President, General Counsel & Secretary.
+Added: We depend on the continued services of our key personnel, including James Ballengee, our Chief Executive Officer, Kimberly Hawley, our Executive Vice President, Chief Financial Officer & Treasurer, Les Patterson, our Executive Vice President and Chief Operating Officer, and Pat Knapp, our Executive Vice President, General Counsel & Secretary.
Our work with each of these key personnel are subject to changes and/or termination, and our inability to effectively retain the services of our key management personnel, could materially and adversely affect our operating results and future prospects.
−Removed: We may have difficulty raising additional capital, which could deprive us of necessary resources, and you may experience dilution or subordinate stockholder rights, preferences and privileges as a result of our financing efforts.
+Added: We may have difficulty raising additional capital when needed, and any such financing could result in dilution to existing stockholders or the issuance of securities with rights, preferences, or privileges that are senior to those of our common stock, which could materially and adversely affect existing stockholders.
We expect to continue to devote significant capital resources to fund the continued development of our sites and related technologies, as well as for potential acquisitions.
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The Company also has warrants outstanding to purchase 400 shares of common stock as of December 31, 2025.
−Removed: Our business plan includes operating internationally, which subjects us to a number of risks.
−Removed: Our strategic plans include international operations, such as our projects in the Middle East.
−Removed: We intend to use our proprietary RPC technology system and develop, construct and potentially sell our RPC system in international locations.
−Removed: Risks inherent to international operations include the following:
−Removed: inability to work successfully with third parties having local expertise to co-develop international projects;
−Removed: multiple, conflicting and changing laws and regulations, including export and import restrictions, tax laws and regulations, environmental regulations, labor laws and other government requirements, approvals, permits and licenses;
−Removed: difficulties in enforcing agreements in foreign legal systems;
−Removed: changes in general economic and political conditions in the countries in which we operate, including changes in government incentives relating to oil remediation;
−Removed: political and economic instability, including wars, acts of terrorism, political unrest, boycotts, curtailments of trade and other business restrictions;
−Removed: difficulties and costs in recruiting and retaining individuals skilled in international business operations;
−Removed: international business practices that may conflict with U.S.
−Removed: customs or legal requirements;
−Removed: financial risks, such as longer sales and payment cycles and greater difficulty collecting accounts receivable;
−Removed: fluctuations in currency exchange rates relative to the U.S.
−Removed: inability to obtain, maintain or enforce intellectual property rights
−Removed: fluctuations in oil prices;
−Removed: Tariffs and trade wars between countries.
+Added: We are subject to the significant influence of one of our current officers and directors, and his interests may not always coincide with those of our other stockholders.
+Added: James Ballengee, one of our officers and directors, and Chairperson of the Board of Directors, beneficially owns approximately 5.0% of our outstanding Common Stock.
+Added: As a result, Mr.
+Added: Ballengee is able to significantly influence all matters requiring approval by our stockholders, including the election of directors and the approval of mergers or other business combination transactions.
+Added: Because the interests of Mr.
+Added: Ballengee may not always coincide with those of our other stockholders, such stockholder may influence or cause us to take actions with which our other stockholders disagree.
Failure to effectively manage our expected growth could place strains on our managerial, operational and financial resources and could adversely affect our business and operating results.
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This strain may inhibit our ability to achieve the rapid execution necessary to implement our business plan and could have a material adverse effect on our financial condition, business prospects and operations and the value of an investment in our company.
−Removed: We have identified material weaknesses in our internal control over financial reporting.
−Removed: Failure to maintain effective internal controls could cause our investors to lose confidence in us and adversely affect the market price of our common stock.
−Removed: If our internal controls are not effective, we may not be able to accurately report our financial results or prevent fraud.
−Removed: Section 404 of the Sarbanes-Oxley Act of 2002 (“Section 404”) requires that we maintain internal control over financial reporting that meets applicable standards.
−Removed: We may err in the design or operation of our controls, and all internal control systems, no matter how well designed and operated, can provide only reasonable assurance that the objectives of the control system are met.
−Removed: Because there are inherent limitations in all control systems, there can be no assurance that all control issues have been or will be detected.
−Removed: If we are unable, or are perceived as unable, to produce reliable financial reports due to internal control deficiencies, investors could lose confidence in our reported financial information and operating results, which could result in a negative market reaction and a decrease in our stock price.
−Removed: We have identified material weaknesses in our internal controls related to the segregation of duties and financial reporting process within our internal controls.
+Added: We have historically suffered net losses, and we may not be able to sustain profitability.
+Added: We had an accumulated deficit of approximately $99 million as of December 31, 2024, and we expect to continue to incur significant development expenses in the foreseeable future related to the completion of the development and commercialization of our sites and products.
+Added: As a result, we are incurring operating and net losses, and it is possible that we may never be able to sustain the revenue levels necessary to achieve and sustain profitability.
+Added: If we fail to generate sufficient revenues to operate profitably on a consistent basis, or if we are unable to fund our continuing losses, you could lose all or part of your investment.
+Added: Our financial condition casts doubts about our ability to continue as a going concern.
+Added: As a result of our financial condition, there is uncertainty regarding our ability to continue as a going concern.
+Added: To that end, our independent registered public accounting firm for our financial statements for the year ended December 31, 2025 has included an explanatory paragraph describing the uncertainty as to our ability to continue as a going concern.
+Added: In order to continue as a going concern, we must effectively balance many factors and increase our revenues to a point where we can fund our operations from our sales and revenues.
+Added: If we are not able to do this, we may not be able to continue as an operating company.
+Added: We have identified material weaknesses in our internal control over financial reporting, and any failure of these controls could prevent accurate financial reporting or fraud prevention and materially undermine investor confidence in our common stock.
+Added: Section 404 of the Sarbanes-Oxley Act of 2002 (“Section 404”) requires us to maintain effective internal control over financial reporting.
+Added: All internal control systems, however well designed, have inherent limitations and can provide only reasonable assurance that financial reporting objectives are met.
+Added: If we fail, or are perceived to fail, in producing reliable financial reports, investors could lose confidence in our reported results, which could negatively affect the market price of our common stock.
+Added: We have identified material weaknesses in our internal controls related to segregation of duties and the financial reporting process.
As of December 31, 2025, our Chief Executive Officer and Chief Financial Officer concluded that:
−Removed: (1) we did not have enough personnel in our accounting and financial reporting functions.
−Removed: Due to insufficient personnel in our accounting department, we were not able to achieve adequate segregation of duties, and as a result, we did not have adequate review controls surrounding:
−Removed: (i) our technical accounting matters in our financial reporting process, and (ii) the work of specialists involved in the estimation process.
−Removed: (2) Due to new relationships with a small banking institution and consultants in 2023, we were not able to achieve adequate controls surrounding the review and dual authorization of certain treasury transactions and fixed assets.
−Removed: (3) We did not always follow certain review and authorization procedures related to corporate governance and the release of information to the public.
−Removed: After failing to adhere to certain corporate governance administrative procedures, we did not achieve adequate review at the executive or independent Board of Director level over certain accounting and risk assessments or the timely reporting of material transactions.
−Removed: We also did not achieve adequate review of certain public reports and disclosures prior to the public disclosure of the information.
−Removed: We believe we may be able to substantially resolve our identified material weakness in our internal controls in the future as we continue to hire personnel to fulfill the duties related to the financial reporting process and growth in our business.
−Removed: There can be no assurances that weakness in our internal controls will not occur in the future.
−Removed: If we identify new material weaknesses in our internal control over financial reporting, if we are unable to comply with the requirements of Section 404 in a timely manner, if we are unable to assert that our internal control over financial reporting is effective, or if our independent registered public accounting firm is unable to express an opinion as to the effectiveness of our internal control over financial reporting (if and when required), we may be late with the filing of our periodic reports, investors may lose confidence in the accuracy and completeness of our financial reports and the market price of our common stock could be negatively affected.
−Removed: As a result of such failures, we could also become subject to investigations by the stock exchange on which our securities are listed, the SEC, or other regulatory authorities, and become subject to litigation from investors and stockholders, which could harm our reputation, financial condition or divert financial and management resources from our core business, and would have a material adverse effect on our business, financial condition and results of operations.
−Removed: Our business is dependent on the oil industry, which is subject to numerous worldwide variables.
−Removed: Our prospective customers operate in the oil and gas industry.
−Removed: As a result, we will be subject to the success of the oil and gas industry, which is subject to substantial volatility based on numerous worldwide factors.
−Removed: A decline in the price of crude oil or natural gas will have a material adverse effect on our business, financial condition, results of operations and cash flows.
−Removed: The oil and gas industry is competitive in all its phases.
−Removed: Competition in the oil and gas industry is intense.
−Removed: Our customers could include competitors such as oil and gas companies that have substantially greater financial resources, staff and facilities than those of our customers and lessees.
−Removed: Competitive factors in the distribution and marketing of oil and other hydrocarbon products include price and methods and reliability of delivery.
−Removed: Within the oil remediation market, demand for our services will be limited to a specific customer base and highly correlated to the oil and gas industry.
−Removed: The oil and gas industry’s demand for equipment is affected by a number of factors including the volatile nature of the oil industry’s business, increased use of alternative types of energy and technological developments in the oil remediation process.
−Removed: A significant reduction in the target market’s demand for oil and gas would reduce the demand for the equipment, which would have a material adverse effect upon our business, financial condition, results of operations and cash flows.
−Removed: Low oil prices may substantially impact our ability to generate revenues.
−Removed: Low oil prices may negatively impact our ability to operate.
−Removed: The demand for our products and services depend, in part, on the price of oil and the margins oil producers receive on the sale of oil.
−Removed: Oil prices are volatile and can fluctuate widely based upon a number of factors beyond our control.
−Removed: Any decline in the prices of and demand for oil could have a material adverse effect on our business, financial condition, results of operations and cash flows.
−Removed: Our operations are subject to unforeseen interruptions and hazards inherent in the oil and gas industry, for which we may not be adequately insured and which could cause us to lose customers and substantial revenue.
−Removed: Our operations are exposed to the risks inherent to our industry, such as equipment defects, vehicle accidents, fires, explosions, blowouts, pipe or pipeline failures, and various environmental hazards, such as oil spills and releases of, and exposure to, hazardous substances.
−Removed: For example, our operations are subject to risks associated with storage and handling of oil, including any mishandling or surface spillage.
−Removed: In addition, our operations are exposed to potential natural disasters, including blizzards, tornadoes, storms, floods, other adverse weather conditions and earthquakes.
−Removed: The occurrence of any of these events could result in substantial losses to us due to injury or loss of life, severe damage to or destruction of property, natural resources and equipment, pollution or other environmental damage, clean-up responsibilities, regulatory investigations and penalties or other damage resulting in curtailment or suspension of our operations.
−Removed: The cost of managing such risks may be significant.
−Removed: The frequency and severity of such incidents will affect operating costs, insurability and relationships with customers, employees and regulators.
−Removed: In particular, our customers may elect not to purchase our product if they view our environmental or safety record as unacceptable, which could cause us to lose customers and revenues.
−Removed: Our insurance may not be adequate to cover all losses or liabilities we may suffer.
−Removed: Furthermore, we may be unable to maintain or obtain insurance of the type and amount we desire at reasonable rates.
−Removed: As a result of market conditions, premiums and deductibles for certain of our insurance policies have increased and could escalate further.
−Removed: In addition, sub-limits have been imposed for certain risks.
−Removed: In some instances, certain insurance could become unavailable or available only for reduced amounts of coverage.
−Removed: If we were to incur a significant liability for which we are not fully insured, it could have a material adverse effect on our business, results of operations and financial condition.
−Removed: In addition, we may not be able to secure additional insurance or bonding that might be required by new governmental regulations.
−Removed: This may cause us to restrict our operations, which might severely impact our financial position.
−Removed: Additionally, we may not have coverage if we are unaware of the pollution event and unable to report the “occurrence” to our insurance company within the time frame required under our insurance policy.
−Removed: In addition, these policies do not provide coverage for all liabilities, and the insurance coverage may not be adequate to cover claims that may arise, or we may not be able to maintain adequate insurance at rates we consider reasonable.
−Removed: A loss not fully covered by insurance could have a material adverse effect on our financial position, results of operations and cash flows.
−Removed: A substantial portion of our operating assets are located in the Permian and Eagle Ford Basins, making us vulnerable to risks associated with geographic concentration in two geographic areas.
−Removed: While we have positions in every major oil and natural gas-producing basin in the contiguous lower 48 states, our assets are disproportionately located in the Permian and Eagle Ford Basins of Texas and New Mexico, making us vulnerable to risks associated with geographic concentration in those areas.
−Removed: In particular, we and our customers may be disproportionately exposed to the impact of regional supply and demand factors, delays or interruptions of production from oil and natural gas wells in this area, availability of equipment, facilities, personnel or services, market limitations, governmental regulation and political activities, processing or transportation capacity constraints, natural disasters, adverse weather conditions, water shortages or other drought related conditions or interruption of the processing or transportation of oil and natural gas.
−Removed: In addition, the effect of fluctuations on supply and demand may become more pronounced within specific geographic oil and natural gas producing areas such as the South Karnes Trough or the Delaware Basin, which may cause these conditions to occur with greater frequency or magnify the effects of these conditions.
−Removed: We require a variety of permits to operate our business.
−Removed: If we are not successful in obtaining and/or maintaining those permits it will adversely impact our operations.
−Removed: Our business requires permits to operate.
−Removed: Our inability to obtain permits in a timely manner could result in substantial delays to our business.
−Removed: In addition, our customers may not receive permitting for our equipment’s specific use and we may be unable to adjust our equipment to meet our customer’s permitting needs.
−Removed: The issuance of permits is dependent on the applicable government agencies and is beyond our control and that of our customers.
−Removed: There can be no assurance that we and/or our customers will receive the permits necessary to operate, which could substantially and adversely affect our operations and financial condition.
−Removed: We are required to pay permit and approval fees to operate in certain business segments and locations.
−Removed: If we are not able to pay those fees it would adversely impact our business.
−Removed: We are required to pay various types of permit and approval fees to the applicable governmental and quasi-governmental agencies to operate our business.
+Added: Accounting and financial reporting personnel:
+Added: We lacked sufficient personnel to achieve adequate segregation of duties and review controls over technical accounting matters and specialist estimates
+Added: Accounting and financial reporting personnel:
+Added: We had employee turnover during the year ended December 31, 2025, which impacted the consistency and effectiveness of internal controls, including technical accounting matters and the work of specialists involved in the estimation process.
+Added: These control deficiencies, which are pervasive in nature, result in a reasonable possibility that material misstatements of the financial statements will not be prevented or detected on a timely basis.
+Added: We are taking steps to address these material weaknesses, including hiring additional personnel and strengthening our financial reporting processes.
+Added: However, there can be no assurance that material weaknesses will not occur in the future.
+Added: If new material weaknesses are identified, or if we fail to comply with Section 404 requirements, we may be unable to assert that our internal control over financial reporting is effective.
+Added: This could result in delayed filings, loss of investor confidence, negative impacts on our stock price, regulatory investigations, or litigation, any of which could materially and adversely affect our business, financial condition, results of operations, and reputation.
+Added: Because we are required to obtain and maintain a variety of permits to operate our business, failure to successfully obtain or maintain such permits could materially and adversely affect our operations.
+Added: Our business requires a variety of permits to operate.
+Added: If we are unable to obtain or maintain these permits in a timely manner, our operations could be delayed or disrupted.
+Added: Additionally, our customers may not receive permits for the specific use of our equipment, and we may be unable to modify our equipment to meet their permitting requirements.
+Added: Permit issuance depends on applicable government agencies and is beyond our control and that of our customers.
+Added: There can be no assurance that we or our customers will obtain the necessary permits, which could have a substantial adverse effect on our operations and financial condition.
+Added: Because we are required to pay permit and approval fees to operate in certain business segments and locations, failure to pay such fees could materially and adversely affect our business.
+Added: We are required to pay various permit and approval fees to governmental and quasi-governmental agencies to operate in certain business segments and locations.
These fees are subject to change at the discretion of the various agencies.
Our inability to pay these permit and approval fees could substantially and adversely affect our operations and financial condition.
−Removed: We, and our customers and prospective customers, are subject to numerous governmental regulations, both domestically and internationally.
−Removed: In order to operate successfully we must be able to comply with these regulations.
+Added: Because we and our customers are subject to numerous domestic and international governmental regulations, our continued success depends on our ability to comply with these requirements.
Current and future government laws, regulations and other legal requirements may increase the costs of doing business or restrict business operations.
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We currently depend, and are likely to continue to depend, on a limited number of customers for a significant portion of our revenues related to our operations.
−Removed: We currently have a limited number of customers for our crude oil gathering, transportation and terminaling services and our RPC services.
−Removed: The failure to obtain additional customers or the loss of all or a portion of the revenues attributable to any current or future customer as a result of competition, creditworthiness, inability to negotiate extensions or replacement of contracts or otherwise could have a material adverse effect on our business, financial condition, results of operations and cash flows.
−Removed: If our customers do not enter into, extend or honor their contracts with us, our profitability could be adversely affected.
−Removed: Our ability to receive payment for production depends on the continued solvency and creditworthiness of our customers and prospective customers.
−Removed: If any of our customers’ creditworthiness suffers, we may bear an increased risk with respect to payment defaults.
−Removed: If customers refuse to accept our equipment or make payments for which they have a contractual obligation, our revenues could be adversely affected.
−Removed: In addition, if a substantial portion of our contracts are modified or terminated and we are unable to replace the contracts (or if new contracts are priced at lower levels), our results of operations will be adversely affected.
−Removed: Our primary business is impacted by the oil industry and the manufacturing industry, which are subject to uncertain economic conditions.
−Removed: The global economy is subject to fluctuation and it is unclear how stable the oil industry and the manufacturing industry will be in the future.
−Removed: As a result, there can be no assurance that the business will achieve anticipated cash flow levels.
−Removed: Further, recent world events evolving out of trade disputes, increased terrorist activities and political and military action, and the COVID-19 pandemic, among other events, have created an air of uncertainty concerning the stability of the global economy.
−Removed: Historically, such events have resulted in disturbances in financial markets, and it is impossible to determine the likelihood of future events.
−Removed: Any negative change in the general economic conditions in the United States and globally could adversely affect the financial condition and operating results of the business.
−Removed: We plan to expand our level of operations.
−Removed: Slower economic activity, concerns about inflation or deflation, decreased consumer confidence, reduced corporate profits and capital spending, adverse business conditions and liquidity concerns in the general economy and recent international conflicts and terrorist and military activity have resulted in a downturn in worldwide economic conditions, especially in the United States.
−Removed: Political and social turmoil related to international conflicts and terrorist acts may place further pressure on economic conditions in the United States and worldwide.
−Removed: These political, social and economic conditions make it extremely difficult for us to accurately forecast and plan future business activities.
−Removed: If such conditions continue or worsen, then our business, financial condition and results of operations could be materially and adversely affected.
−Removed: If we are able to begin operations with our RPCs and remediation services we could incur substantial losses from those operations.
−Removed: In the event we are not able to successfully set up and/or refurbish our RPCs located in Kuwait or obtain a contract for remediation services in the area to be able to operate we could incur substantial losses from those operations and in then having to potentially move the RPCs to another location due to those losses.
−Removed: Under our agreement with Maxus Capital Group, LLC (“Maxus”), we are building out a facility on land we lease near Houston, Texas and are obligated to pay Maxus approximately $58,000 per month for four years.
−Removed: In the event we are not able to complete the facility and commence remediation operations we could default on our obligation to Maxus, which could cause us substantial losses.
−Removed: The current Israeli/Hamas conflict could impact our ability to operate in the Middle East in the future.
−Removed: Any escalation in the current Israeli/Hamas conflict could involve additional Middle East countries and could impact our ability to operate our RPCs located in Kuwait in the future, which could have a material impact on our Middle East projects and our ability to monetize those projects in the future.
−Removed: We are subject to the significant influence of one of our current officers and directors, and his interests may not always coincide with those of our other stockholders.
−Removed: James Ballengee, one of our officers and directors, and Chairperson of the Board of Directors, beneficially owns approximately 43.63% of our outstanding Common Stock.
−Removed: As a result, Mr.
−Removed: Ballengee is able to significantly influence all matters requiring approval by our stockholders, including the election of directors and the approval of mergers or other business combination transactions.
−Removed: Because the interests of Mr.
−Removed: Ballengee may not always coincide with those of our other stockholders, such stockholder may influence or cause us to take actions with which our other stockholders disagree.
−Removed: Because a significant portion of our future revenue growth is expected to be derived from WC White Claw, any development that materially and adversely affects their business, operations or financial condition could have a material adverse impact on us.
−Removed: WC Crude is anticipated to be, among our most significant customers and is expected to play an increasingly important role in our financial performance over the long term.
−Removed: Accordingly, we are indirectly subject to the business risks faced by WC Crude.
−Removed: Because a significant portion of our revenues is derived from WC Crude, any development that materially and adversely affects WC Crude’s businesses, operations or financial condition could have a material adverse impact on us.
−Removed: In addition, if WC Crude is unable to enter into favorable commodity marketing contracts or to obtain the necessary trade credit on favorable terms, it may not be able to perform its obligations as anticipated, or at all, which could negatively affect our results of operations, cash flows and financial position.
−Removed: We will continue to be subject to competition in both of our business segments .
−Removed: In the crude oil gathering, storage and transportation business many of our competitors are large tank farm businesses and if one or more of them built storage tanks and/or facilities near our current facilities they could compete with us for business at our current location.
−Removed: As larger companies, they have greater resources than we do to compete for business in our area and may be able to price us out of business.
−Removed: Our oil remediation equipment utilizes specific technology to extract oil from sand.
−Removed: Oil producers are continually investigating alternative oil production technologies with a view to reduce production costs.
−Removed: In addition, industries that compete with the oil industry, such as the electric power industry, also continue to innovate and create products that compete with the oil industry.
−Removed: There can be no assurance that superior alternative technologies will emerge, which could reduce the demand for and price of our product and services.
−Removed: The market for our products and services is highly competitive and is becoming more so, which could hinder our ability to successfully market our products and services.
−Removed: We may not have the resources, expertise or other competitive factors to compete successfully in the future.
−Removed: We expect to face additional competition from existing competitors and new market entrants in the future.
−Removed: Many of our competitors have greater name recognition and more established relationships in the industry than we do.
−Removed: As a result, these competitors may be able to:
−Removed: develop and expand their product offerings more rapidly;
−Removed: adapt to new or emerging changes in customer requirements more quickly;
−Removed: take advantage of acquisition and other opportunities more readily;
−Removed: devote greater resources to the marketing and sale of their products and adopt more aggressive pricing policies than we can.
−Removed: We carry insurance coverage against liabilities for personal injury, death and property damage, but there is no guarantee this coverage will be sufficient to cover us against all claims.
−Removed: Although, we maintain insurance coverage against liability for personal injury, death and property damage, there can be no assurance that this insurance will be sufficient to cover any such liabilities.
−Removed: We may not be insured or fully insured against the losses or liabilities that could arise from a casualty in the business operations.
−Removed: In addition, there can be no assurance that particular risks that are currently insurable will continue to be insurable on an economical basis or that the current levels of coverage will continue to be available.
−Removed: If a loss occurs that is partially or completely uninsured, we may incur a significant liability.
+Added: For the year ended December 31, 2025, approximately 23% of our total revenues was generated from one major customer, who was a related party.
+Added: In addition, we rely on a limited number of customers across our crude oil transportation, terminaling and storage, marketing and trading, and remediation segments.
+Added: Many of our contracts do not include minimum volume commitments, and demand from these customers may fluctuate due to factors beyond our control.
+Added: The loss of any major customer, a reduction in volumes, or the inability to renew or replace contracts due to competition, credit issues, or other factors could materially and adversely affect our revenues, results of operations, cash flows, and financial condition.
+Added: If we are unable to begin operations with our RPCs and remediation services, or if delays or other risks inherent in early-stage operations occur, we could incur substantial losses.
+Added: Our RPCs and related remediation services are at an early stage of operations, and their success is subject to the substantial risks inherent in establishing a new business venture.
+Added: We may be unable to successfully commission our RPCs, secure contracts for remediation services, or begin operations as planned.
+Added: Delays or difficulties in commissioning, operational interruptions, or the need to relocate facilities could result in substantial losses.
+Added: The construction and operation of the RPCs involve risks related to specialized manufacturing equipment, plant operations, and external factors beyond our control, including adverse weather, strikes, energy shortages, cost inflation, environmental conditions, and legal or regulatory matters.
+Added: Damage, destruction, or malfunction of critical equipment could impair our ability to commence or continue operations, and cost overruns, changes in design, or additional compliance requirements could increase capital and operating expenses, negatively affecting our financial condition and results of operations.
+Added: We also have significant contractual obligations, including land and equipment leases, which could be adversely affected if commissioning or operations are delayed or unsuccessful.
+Added: Moreover, our RPC services, including soil remediation and the extraction and sale of hydrocarbons recovered from contaminated properties, may not prove commercially successful.
+Added: Any of these risks could materially and adversely impact our business, results of operations, cash flows, and financial condition.
+Added: We will continue to be subject to competition in our business segments .
+Added: We face competition across each of our business lines.
+Added: In crude oil transportation, terminaling, and storage, we compete with numerous midstream operators, including large integrated companies with extensive pipeline networks and tank farms, greater financial resources, and the ability to offer more favorable terms.
+Added: In our marketing and trading activities, we compete with well-capitalized integrated energy companies that benefit from broader trading platforms, established market relationships, and stronger credit profiles.
+Added: In our remediation segment, once the RPC becomes operational, we expect competition from established waste treatment, recycling, and environmental service providers, as well as from alternative technologies that oil producers may adopt to reduce costs and from industries seeking substitutes to oil and gas.
+Added: The markets in which we operate are highly competitive and subject to rapid change.
+Added: Many of our competitors benefit from stronger brand recognition, deeper customer relationships, and greater financial and operational resources, which allow them to adapt more quickly to changing conditions, pursue opportunities more aggressively, and allocate more to marketing, sales, and pricing initiatives.
+Added: These competitive pressures could limit our ability to attract and retain customers and could adversely affect our business, financial condition, and results of operations.
+Added: We carry insurance coverage against liabilities for personal injury, commercial liability, pollution, death and property damage, but there is no guarantee this coverage will be sufficient to cover us against all claims.
+Added: Although, we maintain insurance coverage against liability for personal injury, commercial liability, pollution, death and property damage, however there can be no assurance that this coverage will be sufficient to fully cover such liabilities.
+Added: We do not carry business interruption insurance and we may not be insured or fully insured against the potential losses that could arise from our operations.
+Added: In addition, there can be no assurance that insurance for certain risks will remain available in the future on commercially reasonable terms, from our current carriers, or at existing coverage levels.
+Added: If a loss occurs that is partially covered or completely uninsured, or if coverage becomes unavailable for any reason, we could be subject to significant liability, which may adversely affect our business.
We may be unable to adequately protect our proprietary rights.
Our ability to compete partly depends on the superiority, uniqueness and value of our intellectual property.
−Removed: To protect our proprietary rights, we will rely on a combination of patents, copyrights and trade secrets, confidentiality agreements with our employees and third parties, and protective contractual provisions.
−Removed: Despite these efforts, any of the following occurrences may reduce the value of our intellectual property:
−Removed: Our applications for patents relating to our business may not be granted and, if granted, may be challenged or invalidated;
−Removed: Issued patents may not provide us with any competitive advantages;
−Removed: Our efforts to protect our intellectual property rights may not be effective in preventing misappropriation of our technology;
−Removed: Our efforts may not prevent the development and design by others of products or technologies similar to or competitive with, or superior to those we develop;
−Removed: Another party may obtain a blocking patent and we would need to either obtain a license or design around the patent in order to continue to offer the contested feature or service in our products.
+Added: To protect our proprietary rights, we rely on a combination of patents, copyrights, trade secrets, confidentiality agreements with employees and third parties, and protective contractual provisions.
+Added: Despite these efforts, our applications for patents may not be granted or, if granted, may be challenged or invalidated.
+Added: Issued patents may not provide us with competitive advantages, and our protection efforts may not prevent misappropriation of our technology or the development of competing technologies.
+Added: In addition, another party may obtain a blocking patent, which could force us to obtain a license or design around the patent in order to continue offering certain features or services.
We may become involved in lawsuits to protect or enforce our patents that would be expensive and time consuming.
−Removed: In order to protect or enforce our patent rights, we may initiate patent litigation against third parties.
−Removed: In addition, we may become subject to interference or opposition proceedings conducted in patent and trademark offices to determine the priority and patentability of inventions.
−Removed: The defense of intellectual property rights, including patent rights through lawsuits, interference or opposition proceedings, and other legal and administrative proceedings, would be costly and divert our technical and management personnel from their normal responsibilities.
−Removed: An adverse determination of any litigation or defense proceedings could put our pending patent applications at risk of not being issued.
−Removed: Furthermore, because of the substantial amount of discovery required in connection with intellectual property litigation, there is a risk that some of our confidential information could be compromised by disclosure during this type of litigation.
−Removed: For example, during the course of this type of litigation, confidential information may be inadvertently disclosed in the form of documents or testimony in connection with discovery requests, depositions or trial testimony.
−Removed: This disclosure could have a material adverse effect on our business and our financial results.
−Removed: Our operations rely on our ability to transport our equipment to different locations.
−Removed: Any impact on the cost, availability and reliability of transportation could adversely affect our business.
+Added: In order to protect or enforce our intellectual property rights, we may initiate litigation or become subject to interference or opposition proceedings in patent and trademark offices.
+Added: These matters are often expensive and time-consuming, and could divert our technical and management personnel from their normal responsibilities.
+Added: An adverse determination could put our pending patent applications at risk of not being issued or limit our ability to protect existing rights.
+Added: In addition, the discovery process in such proceedings creates a risk that some of our confidential information could be disclosed through documents, depositions, or testimony, which could materially and adversely affect our business and financial results.
+Added: Our business involves litigation risk, and we are currently involved in litigation that may impact our business.
+Added: The crude oil transportation and marketing business is capital- and regulatory-intense, and involves a substantial risk of litigation.
+Added: We are currently involved in material litigation.
+Added: While we endeavor to vigorously defend all claims against us, there is a risk that the outcomes or any or all of our current or future litigation may have a material adverse impact on our business, financial condition, results of operations, and cash flows.
+Added: Because our operations depend on our ability to transport equipment to various locations, any increase in cost or disruption in the availability or reliability of transportation could adversely affect our business.
The availability and reliability of transportation and fluctuation in transportation costs could negatively impact our business.
3 unchanged sentences
If they aren’t then it could impact our business.
−Removed: The lands on which we conduct our business operations must comply with applicable zoning regulations.
−Removed: Any unknown or future violations could limit or require us to cease operations.
+Added: The lands on which we conduct our business operations must comply with applicable zoning and land use regulations.
+Added: Any existing and future violations, changes in zoning laws, or challenges by local authorities could limit our ability to operate, require costly modifications, or force us to relocate facilities.
+Added: Such restrictions could adversely affect our business, financial condition, and cash flows.
Data security breaches are increasing worldwide.
10 unchanged sentences
If our officers and directors file a claim against us for indemnification, the associated expenses could also increase our operating costs.
−Removed: We may be subject to liability if our equipment does not perform as expected.
−Removed: We may be exposed to liability in the event our equipment does not perform as expected.
−Removed: We intend to enter into contracts with customers, which will grant certain rights with respect to the condition and use of our products.
−Removed: Certain contractual and legal claims could arise in the event the equipment does not perform as expected and in the event of personal injury, death or property damage as a result of the use of our equipment.
−Removed: There can be no assurance that particular risks are insured or, if insured, will continue to be insurable on an economical basis or that current levels of coverage will continue to be available.
−Removed: We may be liable for any defects in the equipment or its products and services and uninsured or underinsured personal injury, death or property damage claims.
−Removed: When operational, our RPCs depend on our ability to manufacture various pieces of equipment, many of which are quite large.
−Removed: Any disruption in our manufacturing ability will adversely affect our business and operations.
−Removed: Our RPCs are not currently in operation.
−Removed: When operational, our RPCs involve manufacturing and plant operation risks of delay that may be outside of our control.
−Removed: Production or services may be delayed or prevented by factors such as adverse weather, strikes, energy shortages, shortages or increased costs of materials, inflation, environmental conditions, legal matters and other unknown contingencies.
−Removed: Our RPCs also require certain manufacturing apparatus to manufacture the equipment.
−Removed: If the manufacturing apparatus were to suffer major damage or are destroyed by fire, abnormal wear, flooding, incorrect operation or otherwise, we may be unable to replace or repair such apparatus in a timely manner or at a reasonable cost, which would impact our ability to stay in production or service.
−Removed: Any significant downtime of the equipment manufacturing could impair our ability to produce for or serve customers and materially and adversely affect our results of operations.
−Removed: In addition, changes in the equipment plans and specifications, delays due to compliance with governmental requirements or impositions of fees or other delays could increase production costs beyond those budgeted for the business.
−Removed: If any cost overruns exceed the funds budgeted for operations, the business would be negatively impacted.
+Added: We may be subject to liability if our equipment, facilities, and assets do not perform as expected.
+Added: We may be exposed to liability if our equipment, facilities, or other assets fail to perform as intended.
+Added: Contracts with customers typically grant rights regarding the condition and use of our products and services, and certain contractual or legal claims could arise in the event of equipment failure, defects, or accidents.
+Added: Such claims could involve personal injury, death, property damage, or pollution.
+Added: While we maintain insurance coverage, there can be no assurance that all risks are insured, that insurance will remain available on economically reasonable terms, or that our coverage limits will be sufficient.
+Added: We may be liable for uninsured or underinsured claims, which could materially and adversely affect our business, financial condition, and results of operations.
Any accident at our facilities could subject us to substantial liability.
1 unchanged sentence
The occurrence of a significant accident or other event that is not fully insured could adversely affect our business, financial condition, results of operations and cash flows.
−Removed: If critical components become unavailable or our suppliers delay their production of our key components, our business will be negatively impacted.
−Removed: Our ability to get key components to build or repair our equipment is crucial to our ability to manufacture our plants and produce our products.
−Removed: These components are supplied by certain third-party manufacturers, and we may be unable to acquire necessary amounts of key components at competitive prices.
−Removed: If we are successful in our growth, outsourcing the production of certain parts and components would be one way to reduce manufacturing costs.
−Removed: We plan to select these particular manufacturers based on their ability to consistently produce these products according to our requirements in an effort to obtain the best quality product at the most cost-effective price.
−Removed: However, the loss of all or any one of these suppliers or delays in obtaining shipments would have an adverse effect on our operations until an alternative supplier could be found, if one may be located at all.
−Removed: If we get to that stage of growth, such loss of manufacturers could cause us to breach any contracts we have in place at that time and would likely cause us to lose sales.
−Removed: Any shortage of skilled labor would have a detrimental impact on our ability to provide our products and services.
−Removed: The manufacturing and operating of our facilities and equipment requires skilled laborers.
−Removed: In the event there is a shortage of labor, including skilled labor, it could have an adverse impact on our productivity and costs and our ability to expand production in the event there is an increase in demand for our product or services.
−Removed: We rely on third party contractors for some of our operations.
−Removed: If we are unable to find quality contractors, it would severely impact our business.
−Removed: We outsource certain aspects of our business to third party contractors.
−Removed: We are subject to the risks associated with such contractors’ ability to successfully provide the necessary services to meet the needs of our business.
−Removed: If the contractors are unable to adequately provide the contracted services, and we are unable to find alternative service providers in a timely manner, our ability to operate the business may be disrupted, which may adversely affect our business, financial condition, results of operations and cash flows.
+Added: Business operations could be materially affected if key components are unavailable or supplier production is delayed.
+Added: Our ability to manufacture, maintain, and repair our facilities and transportation assets, as well as produce and market our products, depends on timely access to certain key components, some of which are available only from limited third-party suppliers.
+Added: If these components become unavailable, are delayed, or cannot be acquired at competitive prices, our operations could be disrupted.
+Added: The loss of a key supplier, or delays in obtaining shipments, could adversely affect our ability to meet contractual obligations, cause a loss of sales, and have a material adverse effect on our business, financial condition, and results of operations.
+Added: Any shortage of skilled labor or inability to secure qualified third-party contractors could materially disrupt our operations and adversely affect our business.
+Added: Our future growth may place demands on our financial, operational, and human resources, which could negatively affect our results of operations, cash flows, and financial position.
+Added: Our ability to grow depends, in part, on our ability to attract, retain, and deploy skilled personnel.
+Added: Any shortage of skilled labor could adversely impact productivity, increase costs, and limit our ability to expand production to meet demand.
+Added: We outsource certain aspects of our business to third-party contractors and rely on their ability to provide services in a timely and effective manner.
+Added: If contractors fail to perform or if we are unable to secure qualified replacements, our operations could be disrupted, which may materially affect our business, financial condition, results of operations, and cash flows.
Union activities could adversely impact our business.
−Removed: While none of our employees are currently members of unions, we may become adversely effected by union activities.
−Removed: We are not subject to any collective bargaining or union agreement;
−Removed: however, it is possible that future employees may join or seek recognition to form a labor union or may be required to become a labor agreement signatory.
−Removed: If some or all of our employees become unionized, it could adversely affect productivity, increase labor costs and increase the risk of work stoppages.
−Removed: If a work stoppage were to occur, it could interfere with the business operations and have a material adverse effect on our business, financial condition, results of operations and cash flows.
+Added: While none of our employees are currently unionized, future employees may seek union representation or collective bargaining agreements.
+Added: Unionization could increase labor costs, reduce productivity, and raise the risk of work stoppages.
+Added: Any work stoppage could disrupt operations and materially and adversely affect our business, financial condition, results of operations, and cash flows.
+Added: Future acquisitions may fail, be costly, or difficult to integrate, which could materially harm our business and stock value.
+Added: Our growth strategy includes acquiring additional companies, crude oil marketing strategies, and transportation or facility assets, but we may not be able to identify, negotiate, finance, or close acquisitions on acceptable terms, if at all.
+Added: Even if acquisitions are completed, we may face challenges managing multiple businesses or integrating new operations, including differences in corporate culture, systems, personnel, or competitive environments.
+Added: Acquisitions may also involve companies with limited operating histories, small market shares, reliance on key personnel, unpredictable operating results, litigation exposure, rapidly changing products, or significant capital requirements.
+Added: Competition from other investors may further increase acquisition costs or limit available opportunities.
+Added: Future acquisitions may fail to perform as expected, and any of these risks could materially and adversely affect our business, results of operations, financial condition, and the trading price of our common stock.
+Added: Our ability to grow and execute our core business operations may be limited.
+Added: Following the sale of certain non-core assets, our primary focus is on crude oil transportation, facilities services, marketing and trading, and remediation.
+Added: While we intend to expand these operations, there can be no assurance that we will be successful in doing so.
+Added: If we are unable to effectively execute our strategies, compete with larger market participants, or expand into new opportunities, our business plans, financial condition, and revenue growth could be materially and adversely affected.
+Added: We may have insufficient resources to cover our operating expenses and the expenses of raising money and consummating acquisitions.
+Added: We have limited cash to cover our operating expenses and to cover the expenses incurred in connection with money raising and a business combination.
+Added: It is possible that we could incur substantial costs in connection with money raising or a business combination.
+Added: If we do not have sufficient proceeds available to cover our expenses, we may be forced to obtain additional financing, either from our management or third parties.
+Added: We may not be able to obtain additional financing on acceptable terms, if at all, and neither our management nor any third party is obligated to provide any financing.
+Added: This could have a negative impact on our company and our stock price.
+Added: The conflict in Iran, which escalated sharply in late February 2026, has caused uncertainty in the energy markets.
+Added: As of April 2026, our business is subject to significant risks arising from the ongoing armed conflict involving the United States, Israel, and Iran, which has materially disrupted regional energy markets, critical infrastructure, and the maritime supply chains, which could impact our business in unforeseen ways.
+Added: The conflict, which escalated sharply beginning in late February 2026, has resulted in the effective closure of the Strait of Hormuz — the world’s single most critical energy chokepoint — to most commercial shipping, with Iran threatening to fire on vessels attempting transit and commercial operators, major oil companies, and insurers having substantially withdrawn from the corridor.
+Added: The closure has been characterized as the largest disruption to global energy supply since the 1970s energy crisis.
+Added: These events could have an unknown impact on our business, our ability to obtain insurance at reasonable levels, and other potential unforeseen consequences.
+Added: Risks Related to our Common Stock
Although our shares of Common Stock are listed on The Nasdaq Capital Market, our shares of Common Stock are subject to potential delisting if we do not meet or continue to maintain the listing requirements of The Nasdaq Capital Market.
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a net income from continuing operations (in the latest fiscal year or two of the three last fiscal years) of at least $500,000, a market value of listed securities of at least $35 million or a stockholders’ equity of at least $2.5 million.
+Added: Previously, we were not in compliance with Nasdaq’s $1.00 per share minimum bid price requirement, which caused us to be suspended from trading on Nasdaq.
+Added: We recently regained compliance with Nasdaq’s $1.00 minimum bid price requirement and expect to be re-listed on Nasdaq in April, 2026.
If our securities are ever delisted from Nasdaq, trading will most likely take place on the OTC Marketplace operated by OTC Markets Group Inc.
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For these reasons and others, delisting would adversely affect the liquidity, trading volume and price of our Common Stock, causing the value of an investment in us to decrease and having an adverse effect on our business, financial condition and results of operations, including our ability to attract and retain qualified executives and employees and to raise capital.
−Removed: We may not be able to identify, negotiate, finance or close future acquisitions.
−Removed: One component of our growth strategy focuses on acquiring additional technologies, companies and/or assets.
−Removed: We may not, however, be able to identify, audit, or acquire technologies, companies and/or assets on acceptable terms, if at all.
−Removed: Additionally, we may need to finance all or a portion of the purchase price for an acquisition by incurring indebtedness.
−Removed: There can be no assurance that we will be able to obtain financing on terms that are favorable, if at all, which will limit our ability to acquire additional companies or assets in the future.
−Removed: Failure to acquire additional companies or assets on acceptable terms, if at all, would have a material adverse effect on our ability to increase assets, revenues and net income and on the trading price of our common stock.
−Removed: We may not be able to properly manage multiple businesses.
−Removed: We may not be able to properly manage multiple businesses.
−Removed: Managing multiple businesses would be more complicated than managing one or two of business, even if the additional businesses were synergistic with our existing businesses, and would require that we hire and manage executives with experience and expertise in different fields.
−Removed: We can provide no assurance that we will be able to do so successfully.
−Removed: A failure to properly manage multiple businesses could materially adversely affect our company and the trading price of our stock.
−Removed: We may not be able to successfully integrate new acquisitions.
−Removed: Even if we are able to acquire additional technologies, companies and/or assets, we may not be able to successfully integrate those companies or assets.
−Removed: For example, we may need to integrate widely dispersed operations with different corporate cultures, operating margins, competitive environments, computer systems, compensation schemes, business plans and growth potential requiring significant management time and attention.
−Removed: In addition, the successful integration of any companies we acquire will depend in large part on the retention of personnel critical to our combined business operations due to, for example, unique technical skills or management expertise.
−Removed: We may be unable to retain existing management, finance, engineering, sales, customer support, and operations personnel that are critical to the success of the integrated company, resulting in disruption of operations, loss of key information, expertise or know-how, unanticipated additional recruitment and training costs, and otherwise diminishing anticipated benefits of these acquisitions, including loss of revenue and profitability.
−Removed: Failure to successfully integrate acquired businesses could have a material adverse effect on our company and the trading price of our stock.
−Removed: Our acquisitions of businesses may be extremely risky, and we could lose all of our investments.
−Removed: We may invest in seemingly synergistic businesses that are in other risky industries.
−Removed: An investment in these companies may be extremely risky because, among other things, the companies we are likely to focus on:
−Removed: (1) typically have limited operating histories, narrower product lines and smaller market shares than larger businesses, which tend to render them more vulnerable to competitors’ actions and market conditions, as well as general economic downturns;
−Removed: (2) tend to be privately-owned and generally have little publicly available information and, as a result, we may not learn all of the material information we need to know regarding these businesses;
−Removed: (3) are more likely to depend on the management talents and efforts of a small group of people;
−Removed: and, as a result, the death, disability, resignation or termination of one or more of these people could have an adverse impact on the operations of any business that we may acquire;
−Removed: (4) may have less predictable operating results;
−Removed: (5) may from time to time be parties to litigation;
−Removed: (6) may be engaged in rapidly changing businesses with products subject to a substantial risk of obsolescence;
−Removed: and (7) may require substantial additional capital to support their operations, finance expansion or maintain their competitive position.
−Removed: Our failure to make acquisitions efficiently and profitably could have a material adverse effect on our business, results of operations, financial condition and the trading price of our stock.
−Removed: Future acquisitions may fail to perform as expected.
−Removed: Future acquisitions may fail to perform as expected.
−Removed: We may overestimate cash flow, underestimate costs, or fail to understand risks.
−Removed: This could materially adversely affect our company and the trading price of our Stock.
−Removed: Competition may result in overpaying for acquisitions.
−Removed: Other investors with significant capital may compete with us for attractive investment opportunities.
−Removed: These competitors may include publicly traded companies, private equity firms, privately held buyers, individual investors, and other types of investors.
−Removed: Such competition may increase the price of acquisitions, or otherwise adversely affect the terms and conditions of acquisitions.
−Removed: This could materially adversely affect our company and the trading price of our stock.
−Removed: The Merger Agreement we entered into with Empire is subject to numerous closing conditions and may not close as structured, or at all.
−Removed: On February 26, 2024, we entered into the aforementioned Merger Agreement with Empire Diversified Energy, Inc., pursuant to which Empire will become a wholly-owned subsidiary at the closing of the transaction.
−Removed: The Merger Agreement is subject to numerous closing conditions that must be met by both parties and in the event those conditions are not satisfied the structure of the transaction may change prior to closing or the transaction may not close at all.
−Removed: We may have insufficient resources to cover our operating expenses and the expenses of raising money and consummating acquisitions.
−Removed: We have limited cash to cover our operating expenses and to cover the expenses incurred in connection with money raising and a business combination.
−Removed: It is possible that we could incur substantial costs in connection with money raising or a business combination.
−Removed: If we do not have sufficient proceeds available to cover our expenses, we may be forced to obtain additional financing, either from our management or third parties.
−Removed: We may not be able to obtain additional financing on acceptable terms, if at all, and neither our management nor any third party is obligated to provide any financing.
−Removed: This could have a negative impact on our company and our stock price.
+Added: Our Common Stock may be affected by limited trading volume and our share price may be volatile, which could adversely impact the value of our Common Stock.
+Added: There can be no assurance that an active trading market in our Common Stock will be maintained.
+Added: Our Common Stock is likely to experience significant price and volume fluctuations in the future, which could adversely affect the market price of our Common Stock without regard to our operating performance and the market price of our common stock after this offering may drop below the price you pay.
+Added: In addition, we believe that factors such as our operating results, quarterly fluctuations in our financial results and changes in the overall economy or the condition of the financial markets, including as the result of the domestic or global events, could cause the price of our Common Stock to fluctuate substantially.
+Added: These fluctuations may also cause short sellers to periodically enter the market in the belief that we will have poor results in the future.
+Added: We cannot predict the actions of market participants and, therefore, can offer no assurances that the market for our Common Stock will be stable or appreciate over time.
+Added: This Annual Report contains forward-looking statements that are based on our current expectations, estimates and projections but are not guarantees of future performance and are subject to risks and uncertainties.
+Added: This Annual Report contains forward-looking statements.
+Added: These forward-looking statements are not historical facts, but rather are based on current expectations, estimates and projections about our industry, our beliefs and our assumptions.
+Added: Words such as “anticipates,” “expects,” “intends,” “plans,” “believes,” “seeks,” and “estimates,” and variations of these words and similar expressions, are intended to identify forward-looking statements.
+Added: These statements are not guarantees of future performance and are subject to risks, uncertainties and other factors, some of which are beyond our control and difficult to predict and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements.
+Added: These risks and uncertainties include those described in these “Risk Factors” and elsewhere in this Annual Report.
+Added: Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect our management’s view only as of the date of this Annual Report.
+Added: Except as required by law, we undertake no obligation to update any forward-looking statement, whether as a result of new information, future events or otherwise.
+Added: If our shares become subject to the penny stock rules, it would become more difficult to trade our shares.
+Added: If we do not retain a listing on Nasdaq and if the price of our common stock is less than $5.00, our common stock will be deemed a penny stock.
+Added: The penny stock rules require a broker-dealer, before a transaction in a penny stock not otherwise exempt from those rules, to deliver a standardized risk disclosure document containing specified information.
+Added: In addition, the penny stock rules require that before effecting any transaction in a penny stock not otherwise exempt from those rules, a broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive (i) the purchaser’s written acknowledgment of the receipt of a risk disclosure statement;
+Added: (ii) a written agreement to transactions involving penny stocks;
+Added: and (iii) a signed and dated copy of a written suitability statement.
+Added: These disclosure requirements may have the effect of reducing the trading activity in the secondary market for our common stock, and therefore shareholders may have difficulty selling their shares.
+Added: Conversion of our outstanding convertible notes could result in substantial dilution to existing stockholders and depress the market price of our common stock.
+Added: We currently have a number of outstanding convertible promissory notes with an aggregate face value of $10,175,237, plus interest.
+Added: In the event the holders of those notes elect to convert the amounts due under the notes into shares of our common stock, or we elect to make the payments due under the notes in shares of our common stock, such shares could be unrestricted if issued pursuant to an effective Registration Statement or if the shares underlying the conversion are eligible to issued free trading under Rule 144, and the conversion price per share could be lower than the then-current price of our common stock, which could lead to significant decreases in the price of our common stock if the holder of the notes sold such shares of common stock on the open market.
Although we do not believe that we are, or will be, an investment company covered by the Investment Company Act of 1940, if we are deemed to be an investment company, we may be required to institute burdensome compliance requirements and our activities may be restricted, which may make it difficult for us to engage in strategic transactions.
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We are not in the business of buying and selling securities of other companies.
−Removed: As our strategy had involved the Company investing in other companies, including Scepter Holdings, it is possible that we could be deemed an investment company, although, given the nature and extent of our business operations, we do not believe that we are or will be subject us to the Investment Company Act.
−Removed: Our investment in Scepter Holdings arose from loan agreements that were settled in the form of equity because cash was not available for the borrowers to pay the loans in cash.
+Added: As our strategy had involved the Company investing in other companies, including Adapti, Inc., it is possible that we could be deemed an investment company, although, given the nature and extent of our business operations, we do not believe that we are or will be subject us to the Investment Company Act.
+Added: Our investment in Adapti, Inc.
+Added: arose from loan agreements that were settled in the form of equity because cash was not available for the borrowers to pay the loans in cash.
The Company has not traded or sold any securities of other companies that it has acquired.
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government securities and cash items) on an unconsolidated basis.
−Removed: Presently, our “investment securities,” which include our holdings in Scepter Holdings, as well as certain entities described in our corporate structure, comprise approximately 7% of our total assets, which is below such 40% threshold.
+Added: Presently, our “investment securities,” which include our holdings in Adapti, Inc., as well as certain entities described in our corporate structure, comprise approximately .22% of our total assets, which is below such 40% threshold.
As our business continues to develop and production increases, the percentage of our total assets comprised of investment securities is expected to decline substantially;
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Compliance with these additional regulatory burdens would require additional expense for which we have not allotted.
−Removed: On October 1, 2024, we closed the acquisition of the Endeavor Entities.
−Removed: We are in the process of integrating their operations and personnel with our own.
−Removed: If we are unable to complete this transition timely and effectively it could adversely affect our operations.
−Removed: We are in the process of integrating the Endeavor Entities personnel and operations into our operations since we close the acquisition on October 1, 2024.
−Removed: Due to the size of the acquisition, we anticipate this transition will take some time.
−Removed: If we are not able to effectively and timely complete this transition it could adversely affect our operations.
−Removed: Prior to our acquisition of the Endeavor Entities, they were private companies and, as a result, they did not have the same audit and review of financial statements requirements that we have, and their disclosure controls and procedures processes for financial reporting were not the same as a reporting, public company.
−Removed: We anticipate we will have additional material weaknesses in our disclosure controls and procedures over financial reporting during the time that we integrate their financial reporting processes with our financial reporting processes.
−Removed: As private companies the Endeavor Entities did not have the same requirements for audited and reviewed financial statements that we do as a public company reporting under the Securities Exchange Act of 1934, as amended (the “Exchange Act”).
−Removed: As a result, the methods the Endeavor Entities used to prepare their financial statements, as well as the disclosure controls and procedures they had in place around the preparation of such financial statements, may not have been as stringent as the requirements we have as a public company reporting under the Exchange Act.
−Removed: If this is the case, then we may have additional material weaknesses in our disclosure controls and procedures over financial reporting during the time we integrate their financial reporting processes with our financial reporting processes.
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.