Company: ZCARW
Filing Date: 2025-08-14
Form Type: 10-Q
Source: 0001213900-25-076590
Chunk: 576

Company: Zoomcar Holdings, Inc.
Filing Date: 2025-08-14
Form: 10-Q
Item: Part II, Item 1
Chunk 576
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 we are in violation
of the final payment obligation of $412,275 on our loan with Mahindra & Mahindra Financial Services Limited (“Mahindra”).
As of the date hereof, Mahindra has not formally extended or provided a waiver of such overdue payment. Mahindra may initiate legal action
for resolution of the dispute. Such outcomes may have a material adverse impact on our business, operations or financial condition.

Additionally, we are in various
stages of discussion on deferment with our other lenders with regards to the scheduled loan payments from November 2023 onwards and extending
up to July 2025. However, we have not received any formal notice of default from these other lenders, but such lenders have not formally
extended or provided waivers of such overdue payments. While the Company is actively engaging in discussions with its lenders and vendors
to restructure the existing indebtedness by means of reductions and deferment of payment timelines, no assurance can be made that the
Company will be successful in restructuring these outstanding liabilities.

As a result of the foregoing,
the Company is at material risk that the above parties including certain vendors could initiate insolvency proceedings under Indian Insolvency
and Bankruptcy Code 2016 (IBC). As per the provisions of IBC, an operational creditor can initiate an insolvency resolution process against
the Company where the minimum amount of the default is INR 1,00,00,000 (Rupees One crore) or ~USD 119,000. If insolvency proceedings were
initiated and the petition is admitted, it could result in significant disruptions to our operations, loss of management control, and
a substantial decrease in stockholder value. Furthermore, the outcomes of such proceedings are uncertain and could materially affect our
financial position and results of operations.

The Zoomcar Board and Zoomcar
management are evaluating options to improve liquidity and address Zoomcar’s long-term capital structure, however, there can
be no assurance that any such option or plan will be available on favorable terms, or at all.

73

We have issued a significant number of warrants
and exercise of these securities and the sale of the shares of Common Stock issuable thereunder (along with the issuance of any similar
securities in the future,) will dilute your percentage ownership interest and may also result in downward pressure on the price of our
Common Stock.  

As of August 13, 2025, we
have issued and outstanding options to purchase 16 shares of our