Company: ZRCN
Filing Date: 2025-09-10
Form Type: 10-K
Source: 0001641172-25-027037
Chunk: 233

Company: ZRCN Inc.
Filing Date: 2025-09-10
Form: 10-K
Item: Item 1A
Chunk 233
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 or general corporate purposes may be impaired
in the future;

13

our
failure to comply with the financial and other restrictive covenants governing our debt, which requires us to comply with Fixed Cost
Coverage Ratio (“FCCR”) and limits our ability to incur additional debt and sell assets, could result in an event of default
that, if not cured or waived, could have a material adverse effect on our business, financial condition and results of operations; and

Our
exposure to certain financial market risks, including fluctuations in interest rates associated with bank borrowings could become more
significant.

If
we are unable to remain in compliance with our debt covenants, our lenders may restrict our ability to draw on our Credit Facility, which
could have a negative impact on our operations, ability to pay dividends, and growth potential, including our ability to complete acquisitions.

The
Company’s debt covenants may affect its liquidity or limit its ability to pursue acquisitions, incur debt, make investments, sell
assets or complete other significant transactions.

The
Company’s Credit Facility contains the usual and customary covenants regarding significant transactions, including restrictions
on other indebtedness, liens, investments and acquisitions, merger or consolidation transactions, transactions with affiliates and changes
in or amendments to the organizational documents for the Company and its subsidiaries. Unless waived by the Company’s lender, these
covenants could limit the Company’s ability to pursue opportunities to expand its business operations, respond to changes in business
and economic conditions and obtain additional financing, or otherwise engage in transactions that the Company considers beneficial.

The
Company’s ability to comply with its credit facility is subject to future performance and other factors.

The
Company’s ability to make required payments of principal and interest on its debts, to refinance its maturing indebtedness, to
fund capital expenditures or to comply with its debt covenants will depend upon future performance. The Company’s future performance
is, to a certain extent, subject to general economic, financial, competitive, legislative, regulatory and other factors beyond its control.
The breach of any of the debt covenants could result in a default under the Company’s credit facility. Upon the occurrence of an
event of default, the Company’s lender could make an immediate demand of the amount outstanding under the credit facility. If a
default was to occur and such a demand was to be made, there can be no assurance that the Company’s assets would be sufficient
to repay the indebtedness in full.

The
Company was