Onar Holding Corp
For the period ended Dec 31, 2025. Filed Jun 11, 2026.
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A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2025 · Filed Jun 11, 2026
ONARStored price and day change unavailable
What changed in Risk Factors?
Read the current filingPrevious report: 10-K
Period ended 2024-12-31; filed 2025-04-15.
0001477932-25-002756
ITEM 1A. RISK FACTORSCurrent report: 10-K
Period ended 2025-12-31; filed 2026-06-11.
0001477932-26-003805
ITEM 1A. RISK FACTORSThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 117 previous paragraphs and 58 current paragraphs.
12 unchanged; 25 reworded; 21 added; 79 removed; 1 previous and 0 current paragraphs rearranged.
Tables are not compared: 6 previous and 0 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (21)
Current report
The financial statements included in this annual report on Form 10-K have been prepared assuming we will continue as a going concern. We have incurred losses since the completion of the reverse merger, have negative working capital and have not generated positive cash flows from operations since the completion of the reverse merger. We generated a loss of $9,276,897 for the period ended December 31, 2025 and have a working capital deficiency of approximately $9.4 million. These matters, among others, raise substantial doubt about our ability to continue as a going concern. Our ability to continue in existence is dependent on our ability to develop additional sources of capital, and/or achieve profitable operations and positive cash flows. Management’s plans with respect to operations include aggressive marketing and raising additional capital through sales of equity or debt securities as may be necessary to pursue our business plans and sustain operations until such time as we can achieve profitability. There can be no assurance that management will be successful in obtaining additional funding or in attaining profitable operations. Any such inability to continue as a going concern may result in our stockholders losing their entire investment.
Current report
The advertising and marketing services business is highly competitive and constantly changing. We compete on the basis of the quality of our work, our ability to protect confidential client information, our technology capabilities, and our pricing. Our competitors include large global holding companies, mid-sized agencies, boutique firms, technology companies, and in-house marketing teams. If we are unable to compete successfully, we could lose market share and clients to competitors.
Current report
We have made and continue to make significant investments in AI, data analytics, and marketing technology through ONAR Labs, including the Retina AI platform and the broader ONAR Labs technology stack. There can be no assurance that client demand for these products will exist or be sustained at the levels we anticipate, or that these initiatives will generate sufficient revenue to justify our investment. Additionally, these investments may place demands on management and internal resources, and may involve significant upfront capital expenditures before generating meaningful revenue.
Current report
We are building AI features into our offerings and are investing in expanding our AI capabilities through ONAR Labs. The use of AI and generative AI involves significant technical complexity. Any disruption or failure in our AI offerings could result in delays or errors, which could damage our reputation and adversely affect our business. The AI regulatory landscape is evolving, and new regulations may increase our compliance costs or restrict our ability to use AI technologies in ways that are integral to our business strategy.
Current report
Our business strategy relies on our ability to identify, complete, and successfully integrate strategic acquisitions. We completed the Juice Labs LLC acquisition and Retina AI acquisition in September 2025, and we expect to continue pursuing additional transactions. Any future transaction may result in a change in our business focus and may involve risks including the failure to achieve anticipated synergies, difficulty integrating acquired operations, and potential unknown liabilities.
Current report
We are a company with a limited operating history in our current form.
Current report
We had negative working capital as of December 31, 2025, as a result of costs associated with acquisitions and investments in growing the business. With our current cash on hand, expected revenues, and based on our current average monthly expenses, we anticipate the need for additional funding to meet our planned operating activities over the next 12 months. These conditions raise substantial doubt about our ability to continue as a going concern. We may not be able to borrow or raise additional capital in the future to meet our needs, which might result in the value of our common stock decreasing. We are actively pursuing refinancing of near-term debt maturities, raising additional equity or debt capital, and driving revenue growth to address our liquidity needs.
Current report
We face risks associated with integrating acquired businesses.
Current report
Our growth strategy depends on our ability to successfully integrate acquired businesses, including Juice Labs LLC and Retina AI. The integration of acquired businesses involves significant challenges, including: the difficulty of integrating acquired products, services or operations; the potential disruption of ongoing businesses; difficulties in maintaining uniform standards, controls, procedures and policies; the potential impairment of relationships with employees and clients; and potential unknown liabilities associated with acquired businesses. Our inability to successfully integrate acquisitions could have a material adverse effect on our business.
Current report
The use of our products involves the storage, transmission and processing of our clients’ data. Individuals or entities may attempt to penetrate our computer systems. If successful, they could compromise confidential client data. Any actual or perceived breach of data security could adversely affect our reputation, client relationships, and business.
Current report
We are dependent upon the personal efforts and abilities of our management, including Claude Zdanow (Chief Executive Officer and Chief Financial Officer), Chris Becker (President), and other key members of our management team and subsidiary leadership. The loss of any key personnel could have a material adverse effect on our business. We do not currently maintain key person life insurance policies on our executive officers.
Current report
Employees, including creative, technology, data science, media, and account specialists, and their skills and relationships with clients, are among our most important assets. Our ability to serve our clients and grow our business depends on our ability to attract, develop, and retain talented people. Competition for qualified personnel is intense, and we may not be able to attract and retain the skilled employees we need.
Current report
Our Chief Executive Officer, Claude Zdanow, beneficially owns a significant percentage of the issued and outstanding shares of our common stock and also holds all 1,000 outstanding shares of Series A Preferred Stock, which carry super-majority voting rights. As a result, Mr. Zdanow has the ability to influence matters affecting stockholders, including the election of directors and the approval of significant corporate transactions. While the Company expanded its Board during 2025 with the addition of independent directors, Mr. Zdanow’s voting control remains significant and could discourage potential acquisition proposals and delay or prevent a change of control. In addition, on August 31, 2025, Mr. Zdanow began serving as the principal financial officer of the Company as well.
Current report
We have in the past and may in the future identify material weaknesses in our internal controls over financial reporting.
Current report
If we identify one or more material weaknesses in our internal control over financial reporting, we will be unable to assert that our internal controls are effective. If we cannot assert that our internal controls over financial reporting are effective, or if our independent registered public accounting firm were to report a material weakness, we could lose investor confidence in the accuracy and completeness of our financial statements, which could materially adversely affect our business. Our internal controls may not prevent or detect misstatements due to inherent limitations, and even effective controls provide only reasonable assurance regarding the preparation and fair presentation of our financial statements. Failure to maintain adequate internal controls, implement required new or improved controls, or difficulties in their implementation could harm our business and operating results and prevent us from meeting our financial reporting obligations.
Current report
We identified material weaknesses in our internal control over financial reporting as of December 31, 2025. In particular, we failed to maintain (i) an effective control environment due to limited accounting personnel and insufficient segregation of duties across key financial reporting processes and (ii) effective controls over our financial reporting process, including controls over the preparation and review of financial statements, technical accounting analyses, reconciliations, and SEC reporting disclosures. For further discussion of the material weaknesses identified, see Part II, Item 9A, “Controls and Procedures.”
Current report
We have no committed source of financing. Wherever possible, our Board will attempt to use non-cash consideration to satisfy obligations. Our Board may issue shares of common stock to settle debts, fund operations, and compensate employees or consultants. These issuances would dilute the ownership interests of existing stockholders and may reduce the value of previously issued shares.
Current report
Although our common stock trades on the OTCQB Market maintained by OTC Markets, to date only a limited number of shares have been regularly traded. There can be no assurance that a more active trading market will develop. Even if a more significant trading market develops, we cannot predict how liquid that market might become. Factors such as quarterly variations in results, competitive announcements, commencement of litigation, and general market conditions could cause wide fluctuations in the trading price of our common stock.
Current report
We have not paid any cash dividends and have no plans to issue cash dividends in the future.
Current report
We have not paid any cash dividends on our common stock to date and do not anticipate any cash dividends being paid to holders of our common stock in the foreseeable future. While our dividend policy will be based on the operating results and capital needs of the business, it is anticipated that all earnings, if any, will be retained to finance our operations.
Current report
The market price of our common stock has been, and is likely to continue to be, highly volatile. There have been, and may be, periods of minimal or nonexistent trading activity in our shares. Investors who purchase our common stock may have difficulty selling their shares at a price that is attractive or at all.
Removed paragraphs (79)
Previous report
We face risks and uncertainties related to our business, many of which are beyond our control. In particular, risks associated with:
Previous report
The advertising and marketing services business is highly competitive and constantly changing. We compete on the basis of many factors, including the quality (and clients’ perceptions of the quality) of our work, our ability to protect the confidentiality of clients’ and their customers’ data, our relationships with key client personnel, our expertise in particular areas or disciplines, the differentiation of our offerings and our ability to provide integrated services at the scale clients require. We compete with a diverse and growing set of marketing services firms and consultancies including other large multinational companies. We are smaller than many of our larger industry competitors, and an agency’s ability to serve clients on a broad basis and across a range of services and technologies is an important competitive consideration. We also compete with smaller businesses that operate in local or regional markets, and because an agency’s principal asset is often its people, barriers to entry are minimal, and relatively small brands are, on occasion, able to take all or some portion of a client’s business from a larger competitor. Consolidation of companies in our industry, including through strategic mergers or acquisitions, may also result in new competitors with greater scale than ours. Competitive challenges also arise from rapidly evolving and new technologies in the marketing and advertising space, which create opportunities for new and existing competitors and a need for continued significant investment in tools, technologies and process improvements.
Previous report
In addition, our competitors may compete for client engagements by significantly discounting their services. Price competition could force us to choose between lowering our prices (and suffering reduced operating margins) or losing a client’s business.
Previous report
Our future financial performance is largely dependent upon our ability to compete successfully in the markets we serve. If we are unable to compete successfully, we could lose market share and clients to competitors or be forced to accept engagements with unfavorable economic terms, which could have a material adverse effect on our business, results of operations, financial condition and prospects.
Previous report
We have made investments to develop new marketing services products and technologies, including marketing data, campaign martech, and AI and generative AI offerings, and we intend to continue investing significant resources in developing and/or acquiring new technologies, tools, features, services, products and offerings. Our new initiatives are inherently risky, as each involves development of new software platforms or other product offerings, unproven business strategies and technologies with which we may have limited prior development or operating experience. They may also involve additional claims and liabilities (including intellectual property claims), expenses, regulatory challenges, and other risks that we do not currently anticipate.
Previous report
There can be no assurance that client demand for our new products, and technologies will exist or be sustained at the levels that we anticipate, or that any of these initiatives will gain sufficient traction or market acceptance to generate sufficient revenue to offset any new expenses or liabilities associated with these new investments. If we do not realize the expected benefits of our investments, our business, financial condition, results of operations and prospects may be harmed.
Previous report
We are increasingly building generative AI features into some of our offerings, such as generative AI content creation tools, and are making investments in expanding our generative AI capabilities. As part of this process, we also utilize generative AI tools offered by third-party providers in the development and testing of our offerings. Generative AI is a new and emerging technology in its early stages of commercial use and presents certain inherent risks. Generative AI algorithms are based on machine learning and predictive analytics, which can create unintended biases and discriminatory outcomes, and outputs can be completely fabricated or false. There is a risk that our algorithms could produce such outcomes or other unexpected results or behaviors that could harm our reputation, business, or clients.
Previous report
In addition, the use of AI and generative AI involves significant technical complexity and requires specialized expertise. Any disruption or failure in our AI and generative AI offerings, or those of our third-party providers, could result in delays or errors in our operations, which could harm our business and financial results. The use of generative AI tools could also result in a greater likelihood of cybersecurity incidents, privacy violations and inadvertent disclosures of our intellectual property or other confidential information, any of which could directly or indirectly harm our business, operations and reputation.
Previous report
The AI regulatory landscape is still uncertain and evolving, and the development and use of AI technologies, including generative AI, in new or existing content creation tools and other offerings may result in new or enhanced governmental or regulatory scrutiny, litigation, ethical concerns or other complications that could be costly and time-consuming and could adversely affect our business, reputation or financial results.
Previous report
Our business strategy relies on our ability to identify strategic acquisition targets to scale our business, and we expect to enter into transactions with third parties. Any future transaction may also result in a change in our business focus. Any future strategic transaction involving the Company or its operations may have a material effect on our operations, cash flows, results of operations, prospects, plan of operations, the listing of our common stock on the OTCQB Market, our officers, directors and majority stockholders, and the value of our securities.
Previous report
We are an early-stage company operating across a number of rapidly developing industries.
Previous report
These risks are described in more detail below. Our future growth will depend substantially on our ability to address these, and the other risks described in this section. If we do not successfully address these risks, our business could be significantly harmed. Because we have a limited operating history our future operations may not result in profitable operations.
Previous report
We had working capital of $(4,033,419) as of December 31, 2024, as a result of costs associated with our reverse merger and other investments in growing the business. With our current cash on hand, expected revenues, and based on our current average monthly expenses, we currently anticipate the need for additional funding in order to continue our operations at their current levels and to pay the costs associated with being a public company for the next 12 months. We may also require additional funding in the future to expand or complete acquisitions. In the event we obtain additional funding in the future, the most likely source of future funds presently available to us will be through the sale of equity capital. Any sale of share capital will result in dilution to existing stockholders. Furthermore, we may incur debt in the future, and may not have sufficient funds to repay our future indebtedness or may default on our future debts, jeopardizing our business viability. While we believe we will retire a good portion of company debt as a result of converting debt into equity, we have an accumulated deficit of $4,681,009 as of December 31, 2024.
Previous report
These conditions raise substantial doubt about our ability to continue as a going concern for the next twelve months. The accompanying financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. Accordingly, the financial statements do not include any adjustments relating to the recoverability of assets and classification of liabilities that might be necessary should the Company be unable to continue as a going concern. The financial statements included herein also include a going concern footnote from our auditors.
Previous report
We may not be able to borrow or raise additional capital in the future to meet our needs or to otherwise provide the capital necessary to expand our operations and business, which might result in the value of our common stock decreasing in value or becoming worthless. Additional financing may not be available to us on terms that are acceptable. Consequently, we may not be able to proceed with our intended business plans. Substantial additional funds will still be required if we are to reach our goals that are outlined in this Report. Obtaining additional financing contains risks, including:
Previous report
Furthermore, in order to pay amounts owed in connection with lawsuits, settlements, and judgments rendered against us, we may be forced to liquidate assets and/or abandon certain of our business plans. If we are unable to pay such amounts, we may be forced to cease operations and/or seek bankruptcy protection.
Previous report
We operate across a number of a highly competitive industries.
Previous report
As a holding company for operating businesses, we operate across a number of different industries and encounter competition from local, regional or national entities, some of which have superior resources or other competitive advantages. Intense competition may adversely affect our business, financial condition or results of operations. Our competitors may be larger and more highly capitalized, with greater name recognition. We will compete with such companies on brand name, quality of services, level of expertise, advertising, product and service innovation and differentiation of product and services. As a result, our ability to secure significant market share may be impeded.
Previous report
The use of our products will involve the storage, transmission and processing of our clients’ data and communications with those clients. Individuals or entities may attempt to penetrate our computer systems, or that of our third-party hosting and storage providers, and could gain access to our clients’ data, which could result in the destruction, disclosure or misappropriation of proprietary or confidential information of our clients’ or their customers, employees and business partners. If any of our clients’ private data is leaked, obtained by others or destroyed without authorization, it could harm our reputation, we could be exposed to civil and criminal liability, and we may lose our ability to access private data, which will adversely affect the quality and performance of our platform. In addition, our platform may be subject to computer malware, viruses and computer hacking, fraudulent use attempts and phishing attacks, all of which have become more prevalent. Any failure to maintain the performance, reliability, security and availability of our products or services and technical infrastructure to the satisfaction of our clients may harm our reputation and our ability to retain existing customers and attract new users. While we will implement procedures and safeguards that are designed to prevent security breaches and cyber-attacks, they may not be able to protect against all attempts to breach our systems, and we may not become aware in a timely manner of any such security breach. Unauthorized access to or security breaches of our platform, network or computer systems, or those of our technology service providers, could result in the loss of business, reputational damage, regulatory investigations and orders, litigation, indemnity obligations, damages for contract breach, civil and criminal penalties for violation of applicable laws, regulations or contractual obligations, and significant costs, fees and other monetary payments for remediation. If customers believe that our systems do not provide adequate security for the storage of sensitive information or its transmission over the Internet, our business will be harmed.
Previous report
We and our third-party service providers, such as our cloud service providers that store, transmit and process data, rely on information technologies and infrastructure, which we use to manage our business, including digital storage of client marketing and advertising information and developing new business opportunities. Increased cybersecurity threats and attacks, such as security breaches, are constantly expanding, evolving, and becoming more sophisticated and pose a risk to our systems and networks. In addition, given the increasing difficulty of detecting cybersecurity threats, undiscovered vulnerabilities in our products or services could expose us or our clients to hackers or other unscrupulous third parties who develop and deploy viruses and other malicious software programs that could attack our products, services and business.
Previous report
We are dependent on information technology networks and systems to securely process, transmit and store electronic information and to communicate among our team around the world and with our people, clients, partners and vendors. As the breadth and complexity of this infrastructure continues to grow, including as a result of the increasing reliance on, and use of, mobile technologies, social media and cloud-based services, the risk of security incidents and cyberattacks has increased. Such incidents could lead to shutdowns or disruptions of or damage to our systems and those of our clients, partners and vendors, and unauthorized disclosure of sensitive or confidential information, including personal data and proprietary business information. Also, given the unpredictability of the timing, nature and scope of such cybersecurity threats and attacks, we may be unable to anticipate attempted security breaches and, in turn, implement adequate preventative measures.
Previous report
In providing services and solutions to clients, we often manage, utilize and store sensitive or confidential client or other data, including personal data and proprietary information, and we expect these activities to increase, including through the use of AI, bots and cloud-based analytics. Security breaches, improper use of our systems and other types of unauthorized access to our systems, data, and information by employees and others may pose a risk that data may be exposed to unauthorized persons or to the public. We have access to sensitive data, personal data, and information that is subject to various data privacy laws and regulations, which have obligations that are triggered in the event of a breach. Unauthorized disclosure of, denial of access to, or other incidents involving sensitive or confidential client, vendor, partner or our own data, whether through systems failure, employee negligence, fraud, misappropriation, or cybersecurity, ransomware or malware attacks, or other intentional or unintentional acts, could damage our reputation and our competitive positioning in the marketplace, disrupt our or our clients’ business, cause us to lose clients and result in significant financial exposure and legal liability. Similarly, unauthorized access to or through, denial of access to, or other incidents involving, our software and IT supply chain or SaaS providers, our service providers’ information systems or those we develop for our clients, whether by our employees or third parties, including a cyberattack by computer programmers, hackers, members of organized crime and/or state-sponsored organizations, who continuously develop and deploy viruses, ransomware, malware or other malicious software programs or social engineering attacks, could result in negative publicity, significant remediation costs, legal liability, damage to our reputation and government sanctions and could have a material adverse effect on our results of operations.
Previous report
Laws and regulations related to consumer privacy, processing of personal data and use of digital tracking technologies have been proposed or enacted in the United States and certain international markets (including the European Union’s General Data Protection Regulation, or “GDPR” and the California Consumer Privacy Act, as amended by the California Privacy Rights Act, or “CCPA”). Further in the United States, both Congress and state legislatures, along with federal regulatory authorities, have continued to increase their attention on advertising and the collection and use of data, including personal data. The SEC has issued rules governing disclosures regarding cybersecurity incident response, governance and risk management. At the state level, consumer data privacy laws continue to be proposed and passed in a number of states across the country. As more privacy legislation continues to be introduced, the Company could be subject to such laws regardless of whether the Company has operations or a physical presence in the applicable state. In the United States, the Federal Trade Commission (the “FTC”) and other regulators continue to seek greater regulation of the collection and processing of personal data, as well as restrictions and requirements for certain targeted advertising practices. We are also subject to evolving privacy laws on data processing activities related to cookies and online marketing. In the European Union, regulators actively enforce privacy requirements related to online behavioral advertising.
Previous report
We continue to face increasing costs of compliance in an uncertain regulatory environment and while we have taken steps to comply with data privacy laws, we cannot guarantee that our efforts will meet the evolving standards imposed by governmental and regulatory agencies, and any failure or perceived failure to comply with these legal requirements could result in regulatory inquiries and penalties, governmental investigations and proceedings, potential consumer, business partner, or securities litigation, damage to our reputation, or other legal liabilities, as well as divert management’s time and attention, all of which could have a material adverse effect on our business and results of operations. Also, any such laws may also have potentially conflicting requirements that would make compliance challenging, as well as potentially resulting in further uncertainty and requiring the Company to incur additional costs and expenses in an effort to comply. Furthermore, these laws and regulations may impact our ability to collect and commercialize data, as well as the efficacy and profitability of certain digital marketing and analytics services we provide to clients, making it difficult to achieve our clients’ goals. These and other related factors could affect our business and reduce demand for certain of our services, which could have a material adverse effect on our results of operations and financial condition.
Previous report
Our business operations could suffer if we fail to adequately protect and enforce our intellectual property and other proprietary rights.
Previous report
We rely on trademark, patent, copyright, trade secret and other intellectual property laws, as well as contractual provisions such as confidentiality clauses, to establish and protect our intellectual property and other proprietary rights, and our proprietary technologies. We cannot be sure that the actions we have taken to establish and protect our trademarks and other intellectual property rights will adequately protect us, and if our existing intellectual property rights are rendered invalid or unenforceable, or narrowed in scope, the intellectual property protections afforded our Brands, products and services would be impaired. Such impairment could impede our ability to market our products and services, negatively affect our competitive position, and harm our business and operating results. Even if we successfully maintain our intellectual property rights, we may be unable to enforce those rights against third parties.
Previous report
We also rely on patents to protect our products, services and designs. We have applied for, and expect to continue to apply for, additional patent protection for proprietary aspects of existing and proposed processes, services and products. Our patent applications may not result in issued patents, and any patents issued as a result of our patent applications may not be of sufficient scope or strength to provide us with any meaningful protection or commercial advantage. Additionally, we seek to maintain the confidentiality of certain trade secrets and other proprietary information to preserve our position in the market. We employ various methods to protect such intellectual property, such as entering into confidentiality agreements with certain third parties and our employees, and controlling access to, and distribution of, our proprietary information. However, our efforts may not be effective in controlling access to our proprietary information, and we may not have adequate remedies for the misappropriation of such information.
Previous report
As we expand our service offerings and the geographic scope of our sales and marketing, we may face additional intellectual property challenges. Certain foreign countries do not protect intellectual property rights as fully as they are protected in the United States and, accordingly, intellectual property protection may be limited or unavailable in some foreign countries where we choose to do business. It may therefore be more difficult for us to successfully challenge the use of our intellectual property rights by other parties in these countries, which could diminish the value of our Brands, products or services and cause our competitive position and growth to suffer. The lack of adequate legal protections of intellectual property or failure of legal remedies for related actions in jurisdictions outside of the United States could have an adverse effect on our business, results of operations, and financial condition.
Previous report
We may be subject to intellectual property infringement or misappropriation claims.
Previous report
We may in the future be the subject of patent or other litigation. Our products and services, including products and services that we may develop in the future, may infringe, or third parties may claim that they infringe, intellectual property rights covered by patents or patent applications under which we do not hold licenses or other rights. Third parties may own or control these patents and patent applications in the United States and abroad. These third parties could bring claims against us that would cause us to incur substantial expenses and, if successfully asserted against us, could cause us to pay substantial damages. Further, if a patent infringement or other intellectual property-related lawsuit were brought against us, we could be forced to stop or delay production or sales of the product that is the subject of the suit. From time to time, we may receive letters from third parties drawing our attention to their patent rights. While we take steps to ensure that we do not infringe upon, misappropriate or otherwise violate the rights of others, there may be other more pertinent rights of which we are currently unaware. The defense and prosecution of intellectual property lawsuits could result in substantial expense to us. An adverse determination of any litigation or interference proceeding to which we may become a party could subject us to significant liabilities. As a result of patent infringement claims, or in order to avoid potential claims, we may choose or be required to seek a license from the third party and be required to pay significant license fees, royalties or both. Licenses may not be available on commercially reasonable terms, or at all, in which event our business would be materially and adversely affected. Even if we were able to obtain a license, the rights may be nonexclusive, which could result in our competitors gaining access to the same intellectual property. Ultimately, if we are unable to obtain such licenses, we could be forced to cease some aspects of our business operations, which could harm our business significantly.
Previous report
Our products and services use open-source software.
Previous report
Some of our solutions use software made available under open-source licenses, and we expect to continue to incorporate open-source software in our solutions in the future. Open-source software is typically freely available. While this may reduce development costs and speed up the development process, it may also present certain risks that may be greater than those associated with the use of third-party commercial software. For example, open-source software is generally provided without any warranties or other contractual protections regarding infringement or the quality of the code, including the existence of security vulnerabilities. We cannot guarantee we comply with all obligations under these licenses. If the owner of the copyright in the relevant open source software were to allege that we had not complied with the conditions of one or more open source licenses, we could be required to incur significant expenses defending against such allegations and could be subject to the payment of damages, enjoined from further use of the software, required to comply with conditions of the license (which may include releasing the source code of our proprietary software to third parties without charge), or forced to devote additional resources to re-engineer all or a portion of our solutions to avoid using the open source software. Any of these events could create liability for us, damage our reputation, and have an adverse effect on our business, result of operations, financial condition and prospects.
Previous report
We are largely dependent upon the personal efforts and abilities of our existing management, currently consisting primarily of Claude Zdanow (Chief Executive Officer and sole member of the Board of Directors), Chris Becker (President), Patricia Kaelin (Chief Financial Officer) and Sam Mendez (Chief of Staff), who play an active role in our operations. Moving forward, should the services of Mr. Zdanow, Mr. Becker, Ms. Kaelin or Ms. Mendez be lost for any reason, the Company will incur costs associated with recruiting replacements and any potential delays in operations which this may cause. If we are unable to replace such individual with a suitably trained alternative individual(s), we may be forced to scale back or curtail our business plan.
Previous report
We do not currently maintain key person life insurance policies on our executive officers. If our executive officer does not devote sufficient time towards our business, we may never be able to effectuate our business plan.
Previous report
Employees, including creative, research and data acquisition, analytics and data science, media, technology development, content development, account and practice group specialists, and their skills and relationships with clients, are among our most important assets. Our success is dependent, in large part, on our ability to keep our supply of marketing services skills and capabilities in balance with client demand around the world and our ability to attract, retain, and motivate personnel with the knowledge and skills to lead our business and serve clients globally, respond quickly to rapid and ongoing changes in demand and the macroeconomic environment, and continuously innovate to grow our business. There is competition for scarce talent with market-leading skills and capabilities in new technologies, and our competitors have directly targeted our employees with such skills and will likely continue to do so. At certain times and in certain geographies, we have found and may continue to find it difficult to hire and retain a sufficient number of employees with the skills or backgrounds to meet current and/or future demand in a cost-effective manner. In these cases, we might need to redeploy existing personnel or increase our reliance on subcontractors to fill our labor needs, and if not done effectively, our profitability could be negatively impacted. Additionally, we may be unable to hire and retain people with the skills necessary to meet the increasing client demand, and we have in the past experienced and may continue to experience wage inflation and other increases to compensation expense, which puts upward pressure on our costs and may adversely affect our profitability if we are unable to recover these increased costs.
Previous report
We are particularly dependent on retaining management and leadership of our subsidiaries with critical capabilities. Our ability to expand depends, in large part, on our ability to attract, develop, retain and integrate both leaders for the local business and people with critical capabilities. If we are not successful in these initiatives, our business, results of operations, financial condition and prospects could be adversely affected.
Previous report
Adverse macro-economic conditions, including inflation and high interest rates could adversely impact our operating results.
Previous report
Heightened levels of inflation and the potential worsening of macro-economic conditions, including slower growth or recession, changes to fiscal and monetary policy, tighter credit, higher interest rates and currency fluctuations, present a risk for us and the stability of our industry. If inflation and interest rates remain at current levels for an extended period, or increase even further, and we are unable to successfully mitigate the impact, our costs are likely to increase, resulting in pressure on our profits, margins and cash flows, and we expect continued and/or further declines in demand for pool construction services. Any of the above may have a material adverse effect on our results of operations and the value of our securities.
Previous report
Our Chief Executive Officer and sole director, Claude Zdanow, beneficially owns approximately 67.57% of the issued and outstanding shares of our common stock and also holds all 1,000 outstanding shares of Series A Preferred Stock which have super majority voting rights, as described in greater detail under “We have established preferred stock which can be designated by the Company’s Board of Directors without stockholder approval and the board has established Series A Preferred Stock, which gives the holder thereof majority voting power over the Company”, below. As a result, he controls approximately 91.2% of the stockholder vote and has the ability to influence matters affecting our stockholders and will therefore exercise control in determining the outcome of all corporate transactions or other matters, including the election of directors, mergers, consolidations, the sale of all or substantially all of our assets, and also the power to prevent or cause a change in control. Any investor who purchases shares will be a minority stockholder and as such will have little to no say in the direction of the Company and the election of directors. Additionally, it will be difficult if not impossible for investors to remove our current director, which will mean he will remain in control of who serves as officers of the Company as well as whether any changes are made in the Board of Directors (currently consisting solely of Mr. Zdanow). As a potential investor in the Company, you should keep in mind that even if you own shares of the Company’s common stock and wish to vote them at annual or special stockholder meetings, your shares will likely have little effect on the outcome of corporate decisions. Because Mr. Zdanow controls the vote on all stockholder matters, investors may find it difficult to replace our management if they disagree with the way our business is being operated. Additionally, the interests of Mr. Zdanow may differ from the interests of the other stockholders and thus result in corporate decisions that are adverse to other stockholders.
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Reworded paragraphs (25)
Previous wording
An investment in our common stock involves a high degree of risk. You should carefully consider the risks described below as well as the other information in this filing before deciding to invest in our company. Any of the risk factors described below could significantly and adversely affect our business, prospects, financial condition and results of operations. Additional risks and uncertainties not currently known or that are currently considered to be immaterial may also materially and adversely affect our business, prospects, financial condition and results of operations. As a result, the trading price or value of our common stock could be materially adversely affected, and you may lose all or part of your investment.
Current wording
An investment in our common stock involves a high degree of risk. You should carefully consider the risks described below as well as the other information in this filing before deciding to invest in our company. Any of the risk factors described below could adversely affect our business, operating results, financial condition and the trading price of our common stock. The risks and uncertainties described below may not be the only risks we face. Additional risks and uncertainties that we are unaware of, or that we currently believe are not material, may also become important factors that adversely affect our business.
Previous wording
Advertising, marketing and communications expenditures are sensitive to global, national and regional macroeconomic conditions, including inflationary pressures, currency fluctuations, geopolitical uncertainty and elevated interest rates, as well as specific budgeting levels and buying patterns. Adverse developments such as inflation or heightened economic uncertainty can reduce the demand for our services and pose a risk that clients may reduce, postpone or cancel spending on advertising, marketing and corporate communications projects. For example, inflation rates have increased in recent years, and the effects of increased inflation and other adverse conditions on our customers have in the past resulted and may in the future result in decreased demand for our products and services, decreased revenue, increases in our operating costs (including our labor costs), and decreased profitability, and may result in reduced liquidity and limits on our ability to access credit or otherwise raise capital. In cases of sustained inflation across several of our major markets, it becomes increasingly difficult to effectively control increases to our costs. If we are unable to increase our fees or take other actions to mitigate the effect of the resulting higher costs, our business, results of operations and financial position could be negatively impacted. In addition, in the past, some clients have responded to weakening economic conditions with reductions to their marketing budgets, which include discretionary components that are easier to reduce in the short term than other operating expenses. This pattern may recur in the future and could have a material adverse effect on our revenue, results of operations, cash flows and financial condition. In addition, elevated interest rates have had and may continue to have the effect of further increasing economic uncertainty and heightening these risks, as well as increasing the cost of capital.
Current wording
Advertising, marketing and communications expenditures are sensitive to global, national and regional macroeconomic conditions, including inflationary pressures, currency fluctuations, geopolitical uncertainty and elevated interest rates, as well as specific industry conditions. Unfavorable economic conditions have in the past and could in the future materially reduce our revenue and negatively impact our operating results. Clients may reduce, postpone, or cancel spending with us if they experience an economic downturn, which could adversely affect our business.
Previous wording
Our revenue and profitability depend on the demand for our services and favorable margins, which have been and may continue to be negatively affected by numerous factors, many of which are beyond our control and unrelated to our work product. To increase our revenues and achieve favorable margins, we will need to attract additional clients or generate demand for additional services and products from existing clients, and such demand will depend on factors including clients’ and potential clients’ requirements, pre-existing vendor relationships, financial condition, strategic plans, internal resources and satisfaction with our work product and services, as well as broader economic conditions, competition and the quality of our Brands’ employees, services and reputation. In addition, developments in the markets we serve, which may be rapid, could shift demand to services and solutions where we are less competitive, or might require significant investment by us to upgrade, enhance or expand our services and solutions to meet that demand. To the extent that we are unable to generate sufficient and profitable client demand, our ability to grow our business, increase our revenues and achieve favorable margins will be limited, which could have a material adverse effect on our business, results of operations, financial condition and prospects.
Current wording
Our revenue and profitability depend on the demand for our services and favorable margins, which have been and may continue to be negatively affected by numerous factors, many of which are beyond our control. To increase our revenue and sustain profitability, we must maintain and expand our existing client relationships and attract new clients. There can be no assurance that we will be able to achieve these objectives.
Previous wording
Our clients may terminate or reduce the scope of their relationships with us on short notice. Our ability to attract and retain clients is an important aspect of our competitiveness, and client loss, including due to competitors, as a consequence of client consolidation, insolvency or a reduction in marketing budgets due to recessionary economic conditions, or a shift in client spending could have a material adverse effect on our business, results of operations, financial condition and prospects. Many companies, including companies with which we have long-standing relationships, put their advertising and marketing communications business up for competitive review from time to time, and we have lost client accounts in the past as a result of such reviews. Our clients may choose to terminate their contracts, or reduce their relationships with us, on a relatively short time frame and for any reason, including as a result of such competitive reviews, a reduction in marketing budgets due to external factors such as economic conditions or their own financial distress or insolvency, competition from other marketing services providers, clients’ consolidation, a shift in their spending or clients’ dissatisfaction with our services, reputation or personnel.
Current wording
Our clients may terminate or reduce the scope of their relationships with us on short notice. Our ability to attract and retain clients is an important aspect of our competitiveness, and client loss could have a material adverse effect on our business, results of operations and financial condition.
Previous wording
We are making investments in new product offerings and technologies that are inherently risky.
Current wording
We are making investments in new product offerings and technologies, including AI, that are inherently risky.
Previous wording
Our revenue, cash flow, operating results and other key operating and performance metrics vary from quarter to quarter due to the seasonal nature of our clients’ spending on the services we provide. For example, clients tend to devote more of their advertising budgets to the fourth calendar quarter to coincide with consumer holiday spending, and we typically generate our highest quarterly revenue during the fourth quarter in each year. Political advertising and related activity have also historically caused our revenue to increase during election cycles, which is most pronounced in even years, in particular during the third and fourth quarters of such years, and to decrease during other periods. Seasonality could have a more significant impact on our revenue, cash flow and operating results from period to period in the event of declines in our growth rate or if seasonal spending becomes more pronounced.
Current wording
Our revenue, cash flow, operating results and other key operating and performance metrics vary from quarter to quarter due to the seasonal nature of our clients’ spending on the services we provide. Historically, client spending tends to be higher in the fourth quarter and lower in the first quarter. These seasonal fluctuations could cause our results to vary from the expectations of securities analysts and investors, which could adversely affect the price of our common stock.
Previous wording
We expect to enter into strategic transactions in the future that we expect to result in material changes in our operations.
Current wording
We expect to enter into strategic transactions in the future that may result in material changes in our operations.
Previous wording
ONAR, LLC was initially formed in July 2021 and our strategy revolves around the acquisition of multiple operating businesses. Because the Company has a limited operating history, you should consider and evaluate our operating prospects in light of the risks and uncertainties frequently encountered by early-stage companies in rapidly evolving markets. These risks include:
Current wording
ONAR, LLC was initially formed in July 2021, and the Company completed its reverse merger in July 2024. Our strategy revolves around the acquisition of multiple operating businesses, and we have a limited track record of operating as a consolidated public company. You should consider and evaluate our operating prospects in light of the risks and uncertainties frequently encountered by companies in the early stages of development.
Previous wording
We will require additional financing in order to execute our business strategy, and we may not be able to raise funds on favorable terms or at all, which raises questions about our ability to continue as a going concern.
Current wording
We will require additional financing in order to execute our business strategy.
Previous wording
The security of our computer systems may be breached, and any unauthorized access to our customer data will have an adverse effect on our business and reputation.
Current wording
The security of our computer systems may be breached.
Previous wording
We are subject to extensive data privacy laws and regulations.
Current wording
We and our third-party service providers rely on information technology infrastructure. As the breadth and complexity of this infrastructure grows, the potential risk of security breaches and cyberattacks increases. We are subject to extensive data privacy laws and regulations, and any failure to comply could result in significant fines and damage to our reputation.
Previous wording
We rely on our management and if they were to leave our company our business plan could be adversely affected.
Previous wording
Our past operating results may not be accurate indicators of future performance, and you should not rely on such results to predict our future performance. Our operating results have fluctuated significantly in the past, and could fluctuate in the future. Factors that may contribute to fluctuations include:
Current wording
Our past operating results may not be accurate indicators of future performance. Our operating results have fluctuated in the past and could fluctuate in the future due to factors including our ability to manage working capital, generate demand in targeted markets, satisfy client demands cost-effectively, and adjust costs for changes in demand.
Previous wording
Our executive officer controls a majority of our voting securities and therefore he has the ability to influence matters affecting our stockholders.
Current wording
Our Chief Executive Officer controls a majority of our voting securities.
Previous wording
There is currently a limited public market for our common stock, which is volatile, sporadic and an illiquid market.
Current wording
There is currently a limited public market for our common stock, which is volatile, sporadic and illiquid.
Previous wording
Our common stock is considered a “penny stock” under SEC rules and it may be more difficult to resell securities classified as “penny stock.”
Current wording
Our common stock is considered a penny stock under SEC rules.
Previous wording
Our common stock is a “penny stock” under applicable SEC rules (generally defined as non-exchange traded stock with a per-share price below $5.00). Unless we maintain a per-share price above $5.00 (or obtain a listing on a national securities exchange), our common stock will continue to be a “penny stock.” These rules impose additional sales practice requirements on broker-dealers that recommend the purchase or sale of penny stocks to persons other than those who qualify as “established customers” or “accredited investors.” For example, broker-dealers must determine the appropriateness for non-qualifying persons of investments in penny stocks. Broker-dealers must also provide, prior to a transaction in a penny stock not otherwise exempt from the rules, a standardized risk disclosure document that provides information about penny stocks and the risks in the penny stock market. The broker-dealer also must provide the customer with current bid and offer quotations for the penny stock, disclose the compensation of the broker-dealer and its salesperson in the transaction, furnish monthly account statements showing the market value of each penny stock held in the customer’s account, provide a special written determination that the penny stock is a suitable investment for the purchaser, and receive the purchaser’s written agreement to the transaction.
Current wording
Our common stock is a penny stock under applicable SEC rules. Unless we maintain a per-share price above $5.00 or obtain a listing on a national securities exchange, transactions in our common stock are subject to additional requirements that may reduce the level of trading activity and make it more difficult for investors to sell their shares.
Previous wording
There may not be sufficient liquidity in the market for our securities in order for investors to sell their shares. The market price of our comment stock has been, and may continue to be, volatile.
Current wording
There may not be sufficient liquidity in the market for our securities.
Previous wording
Our Articles of Incorporation and Bylaws, as amended, generally limit our officers’ and directors’ personal liability to the Company and its stockholders for breach of fiduciary duty as an officer or director except for breach of the duty of loyalty or acts or omissions not made in good faith, or which involve intentional misconduct or a knowing violation of law. Our Articles of Incorporation, and Bylaws, each as amended and restated, provide indemnification for our officers and directors to the fullest extent authorized by the Nevada Revised Statutes against all expenses, liability, and loss, including attorneys’ fees, judgments, fines excise taxes or penalties and amounts to be paid in settlement reasonably incurred or suffered by an officer or director in connection with any action, suit or proceeding, whether civil or criminal, administrative or investigative (hereinafter a “Proceeding”) to which the officer or director is made a party or is threatened to be made a party, or in which the officer or director is involved by reason of the fact that he is or was an officer or director of the Company, or is or was serving at the request of the Company as an officer or director of another corporation or of a partnership, joint venture, trust or other enterprise whether the basis of the Proceeding is an alleged action in an official capacity as an officer or director, or in any other capacity while serving as an officer or director. Thus, the Company may be prevented from recovering damages for certain alleged errors or omissions by the officers and directors for liabilities incurred in connection with their good faith acts for the Company. Such an indemnification payment might deplete the Company’s assets. Stockholders who have questions regarding the fiduciary obligations of the officers and directors of the Company should consult with independent legal counsel. It is the position of the Securities and Exchange Commission that exculpation from and indemnification for liabilities arising under the Securities Act, and the rules and regulations thereunder is against public policy and therefore unenforceable.
Current wording
Our Articles of Incorporation and Bylaws, as amended, generally limit our officers’ and directors’ personal liability to the Company and its stockholders for breach of fiduciary duty except for certain specified matters. These provisions could result in substantial expenditures by the Company and may discourage lawsuits against directors and officers.
Previous wording
Anti-takeover provisions in our Articles of Incorporation, as amended and our Bylaws, as well as provisions of Nevada law, might discourage, delay or prevent a change in control of our company or changes in our management and, therefore, depress the trading price of our common stock.
Current wording
Anti-takeover provisions in our governing documents and Nevada law might discourage, delay or prevent a change in control.
Previous wording
Our Articles of Incorporation, as amended and Bylaws and Nevada law contain provisions that may discourage, delay or prevent a merger, acquisition or other change in control that stockholders may consider favorable, including transactions in which you might otherwise receive a premium for your shares of our common stock. These provisions may also prevent or delay attempts by our stockholders to replace or remove our management. Our corporate governance documents include the following provisions:
Current wording
Our Articles of Incorporation, Bylaws, and Nevada law contain provisions that may discourage, delay or prevent a merger, acquisition or other change in control that stockholders may consider favorable, including transactions in which stockholders might otherwise receive a premium for their shares. Any provision that has the effect of delaying or deterring a change in control could limit the opportunity for our stockholders to receive a premium for their shares.
Previous wording
We incur ongoing costs and expenses for SEC reporting and compliance and without sufficient revenues we may not be able to remain in compliance, making it difficult for investors to sell their shares, if at all.
Current wording
We incur ongoing costs and expenses for SEC reporting and compliance.
Previous wording
In order for us to remain in compliance with our on-going reporting requirements, we may require additional capital and/or future revenues to cover the cost of these filings, which could comprise a substantial portion of our available cash resources or require us to obtain additional capital through the sale of equity or debt. If we are unable to further capitalize the Company or generate sufficient revenues to remain in compliance, it may be difficult for you to resell any shares you may purchase, if at all. There are ongoing costs and expenses for SEC reporting, including the general booking and accounting costs for the preparation of the financial quarterly (Form 10-Qs) and annual filings (Form 10-Ks), and auditor’s fees. Further, there are processing costs in preparing and converting documents and disclosures through the EDGAR filing system, including certain costs for the XBRL that are required as part of the EDGAR filing. We estimate that these costs could result in more than $100,000 per year of ongoing costs.
Current wording
In order for us to remain in compliance with our reporting requirements, we may require additional capital and/or future revenues to cover the cost of these filings. If we are unable to meet these costs through our operations, we may not be able to remain in compliance, which could adversely affect investors’ ability to resell their shares.
Previous wording
We maintain insurance that we believe is customary for businesses of our size and type. However, there are types of losses we may incur that cannot be insured against or that we believe are not economically reasonable to insure. Moreover, any loss incurred could exceed policy limits and policy payments made to us may not be made on a timely basis. Such losses could adversely affect our business prospects, results of operations, cash flows and financial condition.
Current wording
We maintain insurance that we believe is customary for businesses of our size and type. However, there are types of losses we may incur that cannot be insured against or that we believe are not economically reasonable to insure. Any loss incurred could have a material adverse effect on our business.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
Any provision of our Articles of Incorporation, as amended or Bylaws or Nevada law that has the effect of delaying or deterring a change in control could limit the opportunity for our stockholders to receive a premium for their shares of our common stock and could also affect the price that some investors are willing to pay for our common stock.