Going Concern and Financial Stability - The company has substantial doubt about its ability to continue as a going concern due to insufficient cash and marketable securities to repay the 50.0millionConvertiblePromissoryNotedueonJanuary9,2026[261].−ThecompanymaynothavesufficientfundstoredeemtheConvertibleNoteorpaycashamountsdueuponconversion,whichcouldleadtodefaultsunderotherindebtedness[267].−Thecompany′sabilitytoraiseadditionalcapitalmaybeconstrainedbythepriceanddemandforitscommonstock,affectingitsliquidity[261].−ThecompanymayfacedelistingfromNasdaqifitfailstomeetcontinuedlistingrequirements,whichcouldnegativelyimpactthepriceandliquidityofitssecurities[280].InventoryandOperatingExpenses−Thecompanyincurredinventorychargesof19.5 million and 23.5millionforthefourthquarterandfullyear2024,respectively,primarilyduetoexcessandslow−movinginventorywithintheGOESSlineofenergystoragesolutions[264].−Thecompanyplansitsoperatingexpensesbasedonestimatesofcustomerdemand,whichifinaccurate,couldharmitsoperatingresults[265].StockandShareholderImpact−ThecompanyissuedaConvertibleNoteof50.0 million on January 9, 2023, which is convertible into common stock, potentially diluting existing shareholders [266]. - The company may issue additional capital stock in the future, which could dilute existing stockholders' ownership interests [293]. - The board of directors has the ability to issue preferred stock, which could impede acquisition efforts or other transactions [294]. - As of December 31, 2024, the company's directors and executive officers owned approximately 27.7% of the combined voting power of the company's outstanding capital stock, allowing them significant influence over corporate actions [292]. Market Volatility and Compliance Risks - The trading price of the company's common stock ranged from a low of 0.79toahighof2.04 during the year ended December 31, 2024, indicating significant volatility [276]. - The company's common stock has experienced volatility, which may lead to securities litigation, resulting in substantial costs and diversion of management's attention [281]. - The company may face increased costs due to compliance with public company regulations, impacting its net income or increasing its net loss [272]. Internal Controls and Reporting - There is a risk of failing to maintain effective internal controls over financial reporting, which could impair the accuracy of financial statements and investor confidence [282]. - The company is not required to provide certain market risk disclosures as it qualifies as a "smaller reporting company" under the Securities Exchange Act [411]. Customer Demand and Market Commitments - The company lacks long-term purchase commitments from distributors or end customers, making it difficult to forecast future customer demand [263]. - The company's operating results and metrics may fluctuate significantly, potentially leading to a decline in the trading price of its common stock [291]. Acquisition and Takeover Risks - Provisions in the Convertible Note could delay or prevent beneficial takeovers, potentially increasing acquisition costs [268]. - The company's ability to pay dividends is dependent on the financial results and cash flows of its subsidiaries, which may be restricted under applicable laws or regulations [287].
