Company: ZCARW
Filing Date: 2025-08-14
Form Type: 10-Q
Source: 0001213900-25-076590
Chunk: 731

Company: Zoomcar Holdings, Inc.
Filing Date: 2025-08-14
Form: 10-Q
Item: Part II, Item 1A
Chunk 731
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 deficiency in the information technology general controls for information systems that are relevant
to the preparation of the Company’s consolidated financial statements), we could incur additional costs to remediate those issues,
and the existence of those issues could adversely affect our reputation or investor perceptions of it. Being a public company has and
may in the future make it more difficult or costly for us to obtain certain types of insurance, including director and officer liability
insurance. We may ultimately be forced to accept reduced policy limits and coverage with increased self-retention risk or incur substantially
higher costs to obtain the same or similar coverage in the future. Furthermore, if we are unable to satisfy our obligations as a public
company, we could be subject to delisting of our Common Stock, fines, sanctions and other regulatory action and potentially civil litigation.

The additional reporting
and other obligations imposed by various rules and regulations applicable to public companies has and is expected to continue to increase
legal and financial compliance costs and the costs of related legal, auditing, accounting, and administrative activities. These increased
costs will require us to divert a significant amount of money that could otherwise be used to expand the business and achieve strategic
objectives. Advocacy efforts by shareholders and third parties may also prompt additional changes in governance and reporting requirements,
which could further increase costs.

Our current indebtedness, and to the extent
we incur indebtedness in the future, our future indebtedness could adversely affect our financial condition, our ability to raise additional
capital to fund our operations, our ability to operate our business, our ability to react to changes in the economy or our industry and
our ability to pay our debts and could divert our cash flow from operations for debt payments.

We are in default of a majority
of our indebtedness of $25.50 million as of June 30, 2025 as more fully described under the Unaudited Condensed Consolidated Financial
Statements, which has had and will continue to have an adverse effect on our financial condition, our ability to raise additional capital
to fund our operations, and our ability to operate our business. Further, in the future, we may continue to incur a material amount of
indebtedness. Our level of indebtedness increases the possibility that we may be unable to generate cash sufficient to pay the principal
of, interest on, or other amounts due with respect to our indebtedness. Our leverage and debt service obligations could adversely impact
our business, including by:

●impairing our ability to generate cash sufficient to pay