Company: CODI-PB
Filing Date: 2025-12-08
Form Type: 10-K/A
Source: 0001345126-25-000078
Chunk: 100

Company: Compass Diversified Holdings
Filing Date: 2025-12-08
Form: 10-K/A
Chunk 100
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 Financial Statements" and related notes of this Form 10-K/A. If any of these risks actually occur, our business, financial condition, operating results and prospects could be materially and adversely affected. In addition to the factors affecting our specific operating segments identified in connection with the descriptions of these segments and the financial results of the operations of these operating segments elsewhere in this report, the following discussion sets forth the material risk factors we face which make an investment in us speculative or risky.

Risk Factors Relating to the Lugano Investigation and Restatements

The Lugano Investigation and the restatement of our previously issued consolidated financial statements for the Affected Periods has resulted in unanticipated costs, litigation against Lugano and the Company and stockholder litigation against the Company, may result in additional stockholder litigation, regulatory consequences and additional liabilities we are currently unaware of, and may adversely affect investor confidence, our stock price, our ability to raise capital in the future, and our reputation.

We have incurred unanticipated costs for accounting, financing and legal fees in connection with the restatements, including those associated with our entry into forbearance agreements with respect to our credit agreement and indentures due to potential defaults or events of default thereunder. The restatements may erode investor confidence in our Company, our financial reporting, accounting practices and processes, and may raise reputational issues for our business. The Lugano Investigation and the need for a restatement of our historical financial statements have negatively impacted, and may continue to negatively impact, the trading price of our securities, has made it difficult for us to comply with our existing debt covenants and tightened our liquidity, and may make it more difficult for us to raise capital on acceptable terms, or at all. In addition, the Lugano Investigation, the restatements and related material weaknesses in our internal control over financial reporting have resulted in litigation against Lugano and the Company, and stockholder litigation against the Company, and regulatory investigations which may result in adverse regulatory consequences. These and any future regulatory consequences, litigation, claims or disputes, including a potential challenge to the validity of our intercompany loan to Lugano, whether successful or not, could subject us to additional costs or liabilities we are currently unaware of, divert the attention of our management, or impair our reputation. Each of these consequences could have a material adverse effect on our business, results of operations and financial condition.

We have filed this Form 10-K/A to correct certain errors and have identified material weaknesses in our internal control over financial reporting that