What changed in this filing

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Item 1A. Risk Factors

2026-02-25 compared with 2025-02-26 · 52 added, 51 removed, 665 unchanged (13% of the section changed)

41 unchanged sentences

These competitors can use their resources and scale to rapidly respond to competitive pressures and changes in consumer preferences by introducing new products, changing their route to market, reducing prices or increasing promotional activities.

For example, both PepsiCo and the Coca-Cola Company have begun focusing in on the better-for-you space, with the Coca-Cola Company launching a prebiotic soda “Simply Pop” this year.

For example, both PepsiCo and the Coca-Cola Company have begun focusing in on the better-for-you space, with the PepsiCo's acquisition of Poppi and Coca-Cola Company launching a prebiotic soda “Simply Pop”.

We also compete with a range of other brands, including prebiotic soda brands like Poppi and Olipop, and a variety of smaller, regional and private label manufacturers.

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We sell a substantial portion of our products to specific customers.

In 2024, our largest customer represented 13% of our net sales and our second largest customer represented 11% of our net sales, and our largest ten customers represented 71% of our net sales.

In 2025, our largest customer represented 14% of our net sales and our second and third largest customers each represented 12% of our net sales, and our largest ten customers represented 75% of our net sales.

No other customers represented more than 10% of our net sales in 2025.

In 2024, the e-commerce channel represented approximately 12% of our net sales.

The loss of any large customer, the reduction of purchasing levels or the cancellation of any business from a large customer for an extended length of time could negatively impact our sales and profitability.

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The occurrence of health-related illnesses, public health concerns, or other incidents related to the consumption of our products, including allergies, excessive consumption or death to a consumer, could also adversely affect consumer perceptions and affinity for our brand, harm our reputation, and affect the price and availability of affected ingredients, resulting in higher costs and disruptions in supply, which could cause a material reduction in our sales.

Noncompliance with applicable food product quality and safety regulations can result in enforcement action by applicable regulatory agencies, including product recalls, market withdrawals, product seizures, warning letters, injunctions, or criminal or civil liability.

Such incidents could also expose us to product liability, negligence or other lawsuits, including consumer class action lawsuits.

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The failure to meet our staffing needs or any material increase in unplanned turnover rates of our employees may adversely affect our business, results of operations and financial condition.

Disruptions in the worldwide economy, including changes to foreign trade policies, may adversely affect our business, results of operations and financial condition.

Adverse and uncertain economic conditions, including the impacts of inflation, changes in U.S.

foreign trade policies, and governmental tariffs, may impact distributor, retailer and consumer demand for our products.

In addition, our ability to manage normal commercial relationships with our suppliers, contract manufacturers, distributors, retailers and creditors may suffer.

Disruptions in the worldwide economy, including changes to trade policies, may adversely affect our business, results of operations and financial condition.

Adverse and uncertain economic conditions, including the impacts of inflation, changes in trade policies, and governmental tariffs, may impact distributor, retailer and consumer demand for our products.

For example, on March 12, 2025, the U.S.

government imposed a 25% tariff on all steel and aluminum imports, which was raised to 50% in June 2025.

On April 2, 2025, the U.S.

government announced a 10% tariff on product imports from almost all countries and individualized higher tariffs on certain other countries and in July 2025, the U.S.

government announced an intention to increase the baseline reciprocal tariff rate to 15–20%.

These announcements have been followed by announcements of retaliatory tariffs and other actions by other countries, as well as limited exemptions and temporary pauses for U.S.-imposed tariffs and negotiated bilateral trade deals.

Changes in tariffs and trade restrictions can be announced with little or no advance notice.

These actions, some of which are subject to litigation, have caused substantial uncertainty and volatility in financial markets and may result in additional retaliatory measures on U.S.

It is unknown whether and to what extent these tariffs will remain in place or if other new laws or regulations will be adopted.

In addition, our ability to manage normal commercial relationships with our contract manufacturers, distributors, retailers and creditors may suffer.

Due to broad uncertainty regarding the timing, content and extent of any regulatory changes in the U.S.

or abroad, we cannot predict the nature and magnitude of the impact that these changes could have to our business, financial condition and results of operations.

Any resulting economic downturn or increase in geopolitical tensions may adversely impact consumers’ discretionary income and/or adversely affect consumer purchasing behavior, which could have a material adverse effect on our results of operations and financial condition.

Tariff changes could worsen economic conditions in markets in which our products are sold, which could negatively affect the affordability of, and consumer demand for, our beverages.

Consumers may shift purchases to lower-priced or other perceived value offerings during economic downturns and periods of high inflation.

In addition, consumers may choose to purchase private label products rather than branded products because they are generally less expensive.

Distributors and retailers may become more conservative in response to these conditions and seek to reduce their inventories.

Customers in countries like Canada that have been targets of these tariffs and have announced their retaliatory tariffs on goods produced in the United States may boycott or find our products otherwise more expensive than domestic substitutes.

In addition, distributors and retailers may become more conservative in response to these conditions and seek to reduce their inventories.

The imposition or threat of tariffs or additional sanctions on imports or exports in the U.S., Canada or jurisdictions from which we source our supplies could have an adverse impact on our supply chain, results of operations, or overall business.

Additionally, the recent implementation of a 25% import tax on all steel and aluminum entering the U.S.

could adversely impact our operating costs and business overall.

Additionally, the recent implementation of an import tariff on all steel and aluminum entering the U.S.

has increased our cost of goods sold.

We expect to continue to see an increase in our cost of goods sold going forward.

Our results of operations depend upon, among other things, our ability to maintain and increase sales volume with our existing distributors, retailer customers, our ability to attract new consumers, the financial condition of our consumers and our ability to provide products that appeal to consumers at the right price.

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Additionally, adverse weather or natural disasters, including fires, earthquakes, winter storms, floods, droughts, or volcanic events, could impact manufacturing and business facilities, which could result in significant costs and meaningfully reduce our capacity to fulfill orders and maintain normal business operations.

Consumer demand for our products may also be influenced by extreme weather conditions, which may lead to decreased sales.

These factors may result in lower sales volume and increased costs of raw materials and manufacturing.

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It is also costly to establish, develop and maintain international operations and develop and promote our brands in international markets and we may face adverse tax consequences, tariffs, and barriers to trade.

Changes in U.S.

foreign trade policies, including as a result of the new presidential administration, could lead to the imposition of additional trade barriers and tariffs on U.S.

products in foreign jurisdictions.

Such changes in U.S.

trade policy or in laws and policies governing foreign trade, or actions taken by countries in response to such policies, could materially and adversely affect our business and results of operations.

Our expansion may involve expanding into less developed countries, which may have less political, social or economic stability and less developed infrastructure and legal systems.

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Any of our suppliers could discontinue or seek to alter their relationship with our contract manufacturers.

A majority of the stevia extract used in our products is currently sourced from two suppliers, which we have selected because they meet our specific requirements for a particular blend of leaf compounds.

A majority of the stevia extract used in our products is currently sourced from three suppliers, which we have selected because they meet our specific requirements for a particular blend of leaf compounds.

General trade tensions between the U.S.

and China, which began escalating in 2018, could have a negative impact on our business.

The recent proposed tariff increases on imports from China have the potential to disrupt our supply chain and impose additional costs on our business if we cannot properly mitigate the impact of these policies.

and China, have been escalating, which could have a negative impact on our business.

The tariff increases on imports from China proposed in 2025 have the potential to disrupt our supply chain and impose additional costs on our business if we cannot properly mitigate the impact of these policies.

Additionally, there can be no assurance that the future imposition of any tariffs, changes thereto or potential actions taken by countries in response to the tariffs will not have a material adverse effect upon our results of operations.

Any disruption in the stevia extract supply, price, quality, availability or timely delivery could adversely affect our business, performance, and results of operations.

Additionally, our contract manufacturers’ sourcing of the majority of the stevia extract used in our products from one supplier increases the risk of significant supply disruptions from local and regional events.

For more information regarding contract terms, see the section of this Annual Report captioned “ Business — Our Supply Chain .”

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Problems with our contract manufacturers’ business, finances, labor relations, ability to obtain raw materials, costs, production, insurance and reputation, as well as natural disasters, fires, or other catastrophic occurrences could adversely affect the success of our business.

Additionally, the recent implementation of a 25% import tax on all steel and aluminum entering the U.S.

could adversely impact our supply chain and raise operating costs for us.

We seek alternative sources of stevia extract and other plant-based ingredients to use in our products, but we may not be successful in diversifying the raw materials we use in our products.

Additionally, the implementation in 2025 of a 25% import tax, which subsequently increased to 50%, on all steel and aluminum entering the U.S.

adversely impacted our supply chain and raised operating costs for us in 2025 and is expected to continue to affect our results of operations.

We seek alternative sources of stevia extract and other natural ingredients to use in our products, but we may not be successful in diversifying the raw materials we use in our products.

If we need to replace an existing supplier, there can be no assurance that supplies of raw materials will be available when required on acceptable terms, or that a new supplier would allocate sufficient capacity to our contract manufacturers in order to produce sufficient products to meet our requirements, fill our orders in a timely manner, meet our strict quality standards, and ensure that we can supply enough products to meet consumer demand.

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We have previously experienced challenges in sourcing aluminum for our cans, and could in the future experience similar disruptions in supply of our finished beverage products.

The recent implementation by the new administration of a 25% import tax on all steel and aluminum entering the U.S.

could adversely impact our supply chain and raise operating costs for us.

The implementation in 2025 of a 25% import tax, which subsequently increased to 50%, on all steel and aluminum entering the U.S.

adversely impacted our supply chain and raised operating costs for us in 2025 and is expected to continue to affect our results of operations.

Substantial increases in the prices of stevia sweetener, our other ingredients, other raw materials, and packaging materials, to the extent they cannot be recouped through increases in the prices of finished beverage products, could increase operating costs for us and companies we do business with and reduce our profitability.

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Failure by independent third party transportation providers to facilitate delivery of our products on time, or at all, could result in lost sales.

We currently rely upon a third-party transportation broker to procure providers to ship our products.

We currently rely upon a third-party global transportation management company to procure providers to ship our products.

If we fail to meet our shipping schedules, we could damage our relationships with distributors and/or retailers, increase our distribution costs and/or cause sales opportunities to be delayed or lost, including losing shelf space in stores.

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The loss of any certifications could impact consumer’s perception of our brand and products, including the health and wellness attributes, safety, and quality of our products, and could harm our brand reputation and adversely affect our business and results of operations.

Failure by us, our contract manufacturers, or our suppliers to comply with applicable laws and regulations or to obtain and maintain necessary permits, licenses, and registrations relating to our operations could subject us to administrative and civil penalties, including significant fines, injunctions, product recalls or seizures, withdrawals, warning letters, restrictions on the production or marketing of our products, or refusals to permit the import or export of products, civil liability, criminal liability or sanctions, or other enforcement actions.

Failure by us, our contract manufacturers, or our suppliers to comply with applicable laws and regulations or to obtain and maintain necessary permits, licenses, and registrations relating to our operations could subject us to administrative and civil penalties, including significant fines, injunctions, product recalls or seizures, withdrawals, warning letters, untitled letters, restrictions on the production or marketing of our products, or refusals to permit the import or export of products, civil liability, criminal liability or sanctions, or other enforcement actions.

Any of these actions would result in a material effect on our operating results and business and financial condition, including increased operating costs.

For more information regarding government regulations, see the section of this Annual Report captioned “ Business — Government Regulation .”

Our policies and procedures are designed to comply with all applicable laws, accounting and reporting requirements, tax rules and other regulations and requirements, including those imposed by the SEC, the Internal Revenue Service (“IRS”), the U.S.

Department of Health & Human Services, the FDA, the Food and Drugs Act in Canada, Health Canada, the FTC, the USDA, the EPA, OSHA, the U.S.

Department of Justice, state and local governments, and by comparable entities in foreign countries, as well as applicable trade, labor, sanitation, safety, environmental, labeling, anti-bribery and corruption and merchandise laws.

Changes in laws and regulations, or the adoption of new laws or regulations, relating to beverage containers, ingredients and packaging could increase our costs, reduce demand for our products, and otherwise adversely affect our business, results of operations and financial condition.

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The regulatory environment in which we operate could change significantly and adversely in the future.

For example, the recent change in the U.S.

federal administration has led and is expected to continue to lead to changes in the leadership of various U.S.

For example, the current U.S.

federal administration has effected and is expected to continue to seek to effect, propose, or threaten changes in the leadership of various U.S.

federal regulatory agencies and changes or proposed or threatened changes to U.S.

federal government policy that have led to, in some cases, legal challenges as well as uncertainty around the funding, functioning and policy priorities of U.S.

federal government policy, which has led to, in some cases, legal challenges as well as uncertainty around the funding, functioning and policy priorities of U.S.

federal regulatory agencies and the status of current and future regulations.

federal government policy changes have included seeking to temporarily broadly halt federal funding, seeking to aggressively downsize the U.S.

federal government’s workforce and instructing federal agencies to reprioritize or to cease operating or enforcing certain laws or regulations.

federal government policy changes have included efforts to modify or restrict federal funding, restructure federal agency operations or workforce and instructing federal agencies to adjust, delay, or suspend the implementation or enforcement of certain laws or regulations or to cease operating.

We are unable to predict the extent to which the current U.S.

federal administration may impose or seek to impose leadership or policy changes at the U.S.

federal administration may continue to impose or seek to impose leadership or policy changes at the U.S.

federal regulatory agencies responsible for regulating our business or changes to rules and policies impacting our operations.

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The lack of regulatory definition for “natural” and other label statements has contributed to legal challenges against many consumer products companies, and plaintiffs have commenced legal actions against several food companies that market “natural” products and/or product ingredients, asserting false, misleading and deceptive advertising and labeling claims, including claims related to genetically modified ingredients.

For additional information regarding litigation involving such claims against us, see Note 9 - Commitments and Contingencies in the accompanying Notes to our Consolidated Financial Statements included in this Annual Report.

In limited circumstances, the FDA has taken regulatory action against products labeled “natural” that contain synthetic ingredients, chemicals, processing and/or components.

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Currently, our only market outside the United States is Canada.

If regulators determine that the labeling and/or composition of any of our products is not in compliance with laws or regulations in Canada or any other jurisdictions we may enter in the future, or if we or our contract manufacturers otherwise fail to comply with applicable laws and regulations in Canada or any other jurisdictions we may enter in the future, we could be subject to civil remedies or penalties, such as fines, injunctions, recalls or seizures, warning letters, restrictions on the marketing or manufacturing of the products, or refusals to permit the import or export of products, as well as potential criminal sanctions.

If regulators determine that the labeling and/or composition of any of our products is not in compliance with laws or regulations in Canada or any other jurisdictions we may enter in the future, or if we or our contract manufacturers otherwise fail to comply with applicable laws and regulations in Canada or any other jurisdictions we may enter in the future, we could be subject to civil remedies or penalties, such as fines, injunctions, recalls or seizures, warning letters, untitled letters, restrictions on the marketing or manufacturing of the products, or refusals to permit the import or export of products, as well as potential criminal sanctions.

In addition, enforcement of existing laws and regulations, changes in legal requirements and/or evolving interpretations of existing regulatory requirements may result in increased compliance costs and create other obligations, financial or otherwise, that could adversely affect our business, financial condition or operating results.

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Our Class A common stock is listed on the New York Stock Exchange (the “NYSE”) under the symbol “ZVIA.” We are required to satisfy the continued listing requirements of the NYSE to maintain such listing, including, among other things, the maintenance of a certain average closing price of our Class A common stock.

On June 26, 2024, we received formal notice from the NYSE that we were not in compliance with Section 802.01C of the NYSE Listed Company Manual because the average closing price of our Class A common stock was less than $1.00 per share over a consecutive 30 trading-day period.

On October 1, 2024, we regained compliance with the minimum stock price continued listing standard set forth in Section 802.01C.

While we have regained compliance, there can be no assurance that in the future, we will be able to maintain compliance with the NYSE’s continued listing requirements.

In 2024, we received formal notice from the NYSE that we were not in compliance with Section 802.01C of the NYSE Listed Company Manual because the average closing price of our Class A common stock was less than $1.00 per share over a consecutive 30 trading-day period.

While we have regained compliance with this continued listing standard, there can be no assurance that in the future, we will be able to maintain compliance with the NYSE’s continued listing requirements.

In the event that we cannot maintain compliance with the NYSE continued listing standards, we could face significant material adverse consequences, including:

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The trading price of our Class A common stock might also decline in reaction to events that affect other companies in our industry even if these events do not directly affect us.

At the time of the IPO, we determined the initial public offering price for our common stock through negotiations with the underwriters, and the negotiated price may not be indicative of the market price of our common stock currently.

For example, the market value of our common stock has decreased substantially from the initial public offering price.

As a result of these and other factors, you may be unable to resell your shares of our common stock at or above the price you paid.

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Among other things, the Exchange Act requires that we file annual, quarterly and current reports with respect to our business and operating results and maintain effective disclosure controls and procedures and internal controls over financial reporting.

Increasing governmental and societal attention to ESG matters has resulted and could continue to result in new laws and requirements, including disclosure requirements that may expand the nature, scope and complexity of information which we are required to report.

Significant resources and management oversight will be required to maintain and, if required, improve our disclosure controls and procedures and internal controls over financial reporting to meet these evolving requirements.

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We will remain an EGC until the earliest of:

(i) the end of the fiscal year following the fifth anniversary of the IPO, (ii) the first fiscal year after our annual gross revenue is $1.235 billion or more, (iii) the date on which we have, during the previous three-year period, issued more than $1 billion in nonconvertible debt securities or (iv) the end of any fiscal year in which the market value of our Class A common stock held by non-affiliates exceeded $700 million as of the end of the second quarter of that fiscal year.

(i) the end of the fiscal year following the fifth anniversary of the IPO, which is December 31, 2026, (ii) the first fiscal year after our annual gross revenue is $1.235 billion or more, (iii) the date on which we have, during the previous three-year period, issued more than $1 billion in nonconvertible debt securities or (iv) the end of any fiscal year in which the market value of our Class A common stock held by non-affiliates exceeded $700 million as of the end of the second quarter of that fiscal year.

We cannot predict whether investors will find our Class A common stock less attractive if we choose to rely on these exemptions.

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In addition, if we are unable to continue to meet these requirements, we may not be able to remain listed on the New York Stock Exchange.

Any failure to maintain effective disclosure controls and internal control over financial reporting could have a material and adverse effect on our business and operating results, restrict our ability to access the capital markets, require us to expend significant resources to address control deficiencies, subject us to fines, penalties, or judgments, or harm our reputation and cause a decline in the market price of our Class A common stock.

If securities or industry analysts do not publish research or reports about our business, or publish inaccurate or unfavorable research reports about our business, our share price and trading volume could decline.

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Our business involves the storage and transmission of numerous classes of sensitive and/or confidential information, including customers’ and suppliers’ information, private information about employees and financial and strategic information about us and our business partners.

Further, as we pursue new initiatives that improve our operations and cost structure, we will also be expanding and improving our information technologies, resulting in a larger technological presence and corresponding exposure to cybersecurity risk.

Further, as we pursue new initiatives that improve our operations and cost structure, we are expanding and improving our information technologies, resulting in a larger technological presence and corresponding exposure to cybersecurity risk.

If we fail to assess and identify cybersecurity risks associated with new initiatives, we may become increasingly vulnerable to such risks.

Such risks may involve ransomware or other malicious software programs that exploit information security vulnerabilities.

The sophistication of cyberattacks continues to increase and there is no guarantee that the steps we have taken will be sufficient to prevent significant disruption and loss.

Threat actors’ use of artificial intelligence could further enhance the frequency and effectiveness of such attacks.

Additionally, we have been subject to security breaches and cyber incidents in the past and our preventative measures and incident response efforts may not be entirely effective at preventing future breaches.

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Any future pandemics, epidemics disease outbreaks or actual or threatened public health emergencies may have an adverse impact on the global society, economies, financial markets and consumer and business spending.

In addition to the impact on our distributors, contract manufacturers and their suppliers, any future pandemics, epidemics, disease outbreaks or public health emergencies and related public health measures could impact consumer preferences and demand for our products, government regulations and restrictions, transportation and route to market, and availability of raw materials and thus may have a material impact on our business, results of operations and financial condition and such impact remains uncertain and unpredictable.

Risks Related to Our Indebtedness and Liquidity

Risks Relating to Our Indebtedness and Liquidity

We may not be able to secure additional financing on favorable terms, or at all, to meet our future capital needs, which may in turn impair our growth.

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Covenants in our credit facility could adversely impact our operations

Our asset-based credit facility contains a liquidity covenant that required us to maintain liquidity of $7.0 million at all times until December 31, 2024.

Thereafter, we must satisfy a financial covenant requiring a minimum fixed charge coverage ratio of 1.00 to 1.00 as of the last day of any fiscal quarter following the occurrence of certain events of default that are continuing or any day on which availability under the credit facility is less than the greater of $3.0 million and 17.5% of the borrowing base, and must again satisfy such financial covenant as of the last day of each fiscal quarter thereafter until such time as there are no events of default and availability has been above such threshold for 30 consecutive days.

Our asset-based credit facility contains a financial covenant requiring a minimum fixed charge coverage ratio of 1.00 to 1.00 as of the last day of any fiscal quarter following the occurrence of certain events of default that are continuing or any day on which availability under the credit facility is less than the greater of $3.0 million and 17.5% of the borrowing base, and must again satisfy such financial covenant as of the last day of each fiscal quarter thereafter until such time as there are no events of default and availability has been above such threshold for 30 consecutive days.

The agreement governing our credit facility also contains, among other things, customary representations, warranties and default provisions and customary restrictions on making investments, incurring indebtedness, prepaying junior debt, granting liens and making stockholder distributions.

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

What changed 10-K

Item 1A. Risk Factors