Risk Factors Dashboard

An investment in our securities involves a high degree of risk. You should carefully consider the risks described below before making an investment decision. Our business, prospects, financial condition or operating results could be harmed by any of these risks, as well as other risks not currently known to us or that we currently consider immaterial. The trading price of our securities could decline due to any of these risks, and, as a result, you may lose all or part of your investment.

In the course of conducting our business operations, we are exposed to a variety of risks. Any of the risk factors we describe below have affected or could materially adversely affect our business, financial condition and results of operations. The market price of our securities could decline, possibly significantly or permanently, if one or more of these risks and uncertainties occurs. Certain statements in “Risk Factors” are forward-looking statements. See “Special Note Regarding Forward-Looking Statements.”

Risk Factors Summary

Our business is subject to numerous risks and uncertainties, including those highlighted in the section entitled “Risk Factors” immediately following this risk factors summary, that represent challenges that we face in connection with the successful implementation of our strategy and the growth of our business. Our business, prospects, financial condition or operating results could be harmed by any of these risks, as well as other risks not currently known to us or that we currently consider immaterial. In particular, the following considerations, among others, may offset our competitive strengths or have a negative effect on our business strategy, which could cause a decline in the price of shares of our Common Stock or Public Warrants and result in a loss of all or a portion of your investment.

Any of the risk factors we describe below have affected or could materially adversely affect our business, financial condition and results of operations. The market price of our securities could decline, possibly significantly or permanently, if one or more of these risks and uncertainties occurs:

Risks related to our Financial Condition

We have a history of operating losses and negative cash flow, we have limited cash resources, we will need to raise additional funds imminently to finance operations and as a result there is substantial doubt about our ability to continue as a going concern.

We have a history of operating losses and expect to continue incurring operating losses in the foreseeable future as we continue to develop our current business model and enhance our platform offerings. We also have indebtedness that is in default in excess of our current capital resources (see “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources” in this Annual Report on Form 10-K for the year ended March 31, 2026). On June 18, 2024, the Company entered into a securities purchase agreement with certain institutional accredited investors (the “June Aegis Securities Purchase Agreement”) pursuant to which the Company issued and sold an aggregate of $3,600,000 in principal amount of notes (the “June Notes”) and warrants to purchase up to an aggregate of 1,267,728 shares of Common Stock (which takes into account an adjustment following the Company’s Share Combination Event that was effective on October 22, 2024, but not reflecting the Reverse Stock Splits) (the “June Warrants”) for gross proceeds of $3,000,000.

Additionally, on November 7, 2024, the Company closed the November 7 Placement for gross proceeds of $9.15 million (including $2.5 million of which was provided by one of the Company’s directors) (before deduction of fees to the placement agent and other offering expenses payable by the Company). The Placement Agent in this Offering acted as exclusive placement agent in the November 7 Placement. At closing of the November 7 Placement, the Company issued an aggregate of 2,137,850 units at a price of $4.28 per unit, each unit consisting of one share of Common Stock (or pre-funded warrant in lieu thereof), two November Series A Warrants (as hereinafter defined) each to purchase one share of Common Stock and a November Series B Warrant (as hereinafter defined) to purchase such number of shares of Common Stock, as determined on the November Reset Date, which does not reflect the Second Reverse Split. As a result of the November 7 Placement, the Company received $3.62 million of cash and cash equivalents after giving effect to offering fees and expenses, the payment of $3.8 million to the holders of the Company’s June 2024 notes and a holdback of $0.2 million for indemnification of the Placement Agent as described in more detail herein.

Further, on December 24, 2024, the Company held the First Closing of this Offering for gross proceeds of $5,484,843 (including $50,000 of which was provided by the Company’s former Chief Executive Officer i.e. Hiroshi Nishijima and $300,000 of which was provided by a consultant to the Company) (before deduction of fees to the placement agent and other offering expenses payable by the Company). The Placement Agent in this Offering acted as exclusive placement agent at the First Closing. At the First Closing, the Company issued an aggregate of (i) 3,095,925 shares of Common Stock, which does not reflect the Second Reverse Split (ii) Pre-Funded Warrants issued to certain of the investors, at their option, exercisable for an aggregate of up to 420,000 shares of Common Stock, which does not reflect the Second Reverse Split, to the extent that the issuance of shares of Common Stock would cause such Investors to beneficially own more than 4.99% or 9.99% of the shares of Common Stock outstanding. Also issued along with the shares of Common Stock and/or the Pre-Funded Warrants were (x) Series A Warrants to initially purchase up to an aggregate of 8,680,443 shares of Common Stock, which does not reflect the Second Reverse Split, subject to certain adjustments and (y) Series B Warrants to initially purchase no shares of Common Stock, subject to certain adjustments as provided in the Series B Warrants. As a result of the First Closing, the Company received $4,786,963 of cash and cash equivalents after giving effect to offering fees and expenses.

Further, on February 4, 2025, the Company held the Second Closing of this Offering for gross proceeds of $1,437,936 (before deduction of fees to the Placement Agent and other offering expenses payable by the Company). The Placement Agent in this Offering acted as exclusive placement agent at the Second Closing. At the Second Closing, the Company issued an aggregate of (i) 1,049,796 shares of Common Stock, which does not reflect the Second Reverse Split (ii) Pre-Funded Warrants issued to certain of the investors, at their option, exercisable for an aggregate of up to 872,000 shares of Common Stock, which does not reflect the Second Reverse Split, to the extent that the issuance of shares of Common Stock would cause such Investors to beneficially own more than 4.99% or 9.99% of the shares of Common Stock outstanding. Also issued along with the shares of Common Stock and/or the Pre-Funded Warrants were (x) Series A Warrants to initially purchase up to an aggregate of 4,804,491 shares of Common Stock, which does not reflect the Second Reverse Split, subject to certain adjustments and (y) Series B Warrants to initially purchase no shares of Common Stock, subject to certain adjustments as provided in the Series B Warrants. As a result of the Second Closing, the Company received $1,249,911 of cash and cash equivalents after giving effect to offering fees and expenses. As a result of the First Closing, the Company received $1,249,911 of cash and cash equivalents after giving effect to offering fees and expenses.

On March 31, 2025, the Company further entered into a securities purchase agreement, substantially in the same form as the December 2024 SPA and the January 2025 SPA with certain additional accredited investors in connection with the third closing of the Offering (the “Third Closing”). The Company did not receive any cash proceeds in the Third Closing. The securities were issued to the investors either (i) as consideration for waiving certain rights that such investors may have had in connection with a most favored nations provision included in the transaction documents for a prior financing of Zoomcar, Inc. or (ii) to settle outstanding amounts owed by the Company to its Placement Agent and the Legal Counsels. or (ii) to settle outstanding amounts owed by the Company to its Placement Agent and the Legal Counsels (Aegis Settlement and Law Firm Settlement described below). Pursuant to the terms and conditions of the Securities Purchase Agreement, the Company issued to such investors an aggregate of $15,639,099 of securities consisting of 501,318 shares of common stock of the Company, par value $0.0001 per share (the Common Stock). The Company along with the Common Stock issued (i) Series A Warrants to purchase up to an aggregate of 6,706,192 shares of Common Stock at an exercise price of $6.24 per share, which takes into account a “share combination event” adjustment effective following the issuance of such warrants as a result of the Reverse Split (the “Series A Warrants”) and (ii) Series B Warrants to purchase initially no shares of Common Stock and then up to a maximum of 2,004,955 shares of Common Stock subject to certain adjustments, at an initial exercise price of $0.002.

On June 24, 2025, the Company issued a bridge note to certain investors totaling $402,000 at a discount of $42,000. The note is repayable in five monthly installments beginning November 30, 2025, and maturing on March 31, 2026, with interest accruing at 12% per annum on the outstanding principal. The Company received net proceeds of $350,000 after adjusting deduction of legal and due diligence fees of $10,000. Additionally, $45,500 (i.e., 13% of net proceeds) is due to the placement agent relating to the issuance of these bridge notes which is directly attributable to the loan raised, thereby bringing the total debt issuance costs to $55,500. The repayment obligations under these notes have been fully discharged as of the date of filing of this Form 10-K.

On July 31, 2025 , the Company entered into Securities Purchase Agreements with certain institutional accredited investors pursuant to which the Company issued Bridge notes for a total principal amount of $206,225 with an initial issue discount of $23,725. The net proceeds disbursed to the Company were $175,000 after deduction of legal and due diligence fees of $7,500. The repayment obligations under these notes have been fully discharged as of the date of filing of this Form 10-K.

On August 19, 2025, the Company closed a Securities Purchase Agreement (“Labrys SPA”) with Labrys Fund II, L.P. (“Labrys”) pursuant to which it issued a promissory note totaling $180,000 at a discount of $18,000. The note is repayable in 12 months maturing on August 19, 2026 with interest accruing at 12 % per annum on the outstanding principal. The Company received net proceeds of $158,500 after adjusting deduction of legal and due diligence fees of $3,500.

On August 24, 2025, the Company issued a convertible note to AES Capital Management, LLC(“AES”) totaling $112,500 through 2 convertible notes of $75,000, and $37,500 respectively (“AES Notes”). The note amounting $75,000 is the “Primary Note” and the subsequent note of $37,500 is the “Secondary Note”. The AES Notes are repayable in 12 months from their respective closing dates with interest accruing at 8% per annum on the outstanding principal. As of date of filing of this 10-Q, the Company received net proceeds of $ 71,000 after adjusting deduction of legal and due diligence fees of $4,000 from the issuance and closing of the Primary Notes.

On August 24, 2025, the Company issued a convertible note to CFI CAPITAL LLC (“CFI”) totaling $150,000 at a discount of $15,000 (“CFI Note”). The CFI Note is repayable in 12 months maturing on August 24, 2026 with interest accruing at 6 % per annum on the outstanding principal. The Company received net proceeds of $130,000 after adjusting legal cost of $5000.

On November 28, 2025, we closed two Securities Purchase Agreements with DLL and Boot for convertible bridge notes in original principal amounts of $152,550.00 and $56,500.00, respectively. The notes bear interest at 12% per annum, are due September 30, 2026, include installment repayment features and may be prepaid at a discount, but are subject to default interest of 22% per annum and customary events of default and covenants.

On December 10, 2025, we entered into a Securities Purchase Agreement with FirstFire Global Opportunities Fund, LLC, (“FirstFire”) and issued a convertible redeemable note in a principal amount of $220,000 with an original issue discount of $20,000. The note bears interest at 12% per annum, matures 12 months after issuance, is subject to a default penalty that increases the principal amount by 50% and includes customary events of default and covenants. We received net proceeds of approximately $200,000 after fees. Refer to Exhibits 10.60, 10.61 and 10.62 which are incorporated here by reference for terms of the FirstFire Note.

On December 24, 2025, we entered into a Securities Purchase Agreement with AUCTUS FUND, LLC, (“Auctus”) and issued a promissory note for a principal amount of $125,000 with an original issue discount of $12,500 (“Auctus Note”). The note bears interest at 10% per annum with a guaranteed interest at issuance. It matures 12 months after issuance, is subject to a default interest of an additional 8% per annum and includes customary events of default and covenants. It is convertible after the later of (a) 180 days from issuance and (b) upon an event of default under the Auctus Note. We received net proceeds of approximately $100,000 after fees.

On January 8, 2026 we entered into a Securities Purchase Agreement with Quick Capital LLC (“Quick Capital”) and issued a convertible note for principal amount of $42,613.64 with an original discount of $5,113.64 (“Quick Capital Note”). The Quick Capital Note bears interest at 12% per annum with a guaranteed interest at issuance, matures 6 months after issuance, and is subject to default interest of 22% per annum and includes customary events of default and covenants. It is convertible anytime or upon default and has piggyback registration rights. We received net proceeds of approximately $35,000 after fees. The repayment obligations under the Quick Capital Note have been fully discharged as of the date of filing of this Form 10-K.

“February Notes” (DLL & Boot): On February 25, 2026, we closed two Securities Purchase Agreements with DLL and Boot for convertible promissory notes in original principal amounts of $180,800.00 and $84,750.00, respectively. Similar to the June and July 2025 Bridge Notes, in the event of defaults, the note holders may convert the outstanding amount (includes principal, accrued interest, default interest, and other fees as applicable) into the Company’s Common stock at a conversion price equal to 75% of the lowest closing bid price of the Company’s Common stock during the 10 trading days immediately prior to the applicable conversion date. Refer to Exhibits 10.58 and 10.59 which are incorporated here by reference for terms of these Notes.

On April 5, 2026 the Company issued a Promissory Note to Walsh Industries (“Walsh industries”) for principal amount of $100,000 (“Walsh Note”). In addition to the repayment obligation the Company is also required to issue $50,000 worth of Convertible Preferred Stock and additionally, upon occurrence of event of default i.e. non repayment of the Walsh Note, shall further entitle the Walsh Industries to seek $50,000 worth of Convertible Preferred Stock as Penalty Shares. While the repayment obligations have been discharged with delays, the Company is yet to issue the Preferred Stock worth $100,000 (including the Penalty Shares) is pending issuance at the date of filing of this Form 10-K.

On April 23, 2026 the Company issued a Promissory Note to Sod Sciences Inc.(“Sod Sciences”) for principal amount of $22,500.00 (“Sod Sciences April Note”). In addition to the repayment obligation the Company is also required to issue $100,000 worth of Convertible Preferred Stock and additionally, upon occurrence of event of default i.e. non repayment of the Sod Sciences April Note, shall further entitle the Sod to seek $100,000 worth of Convertible Preferred Stock as Penalty Shares.

On May 5, 2026 the Company issued another Promissory Note to Sod Sciences Inc.(“Sod Sciences”) for principal amount of $43,845.70 (“Sod Sciences May Note”). In addition to the repayment obligation the Company is also required to issue $241,200 worth of Convertible Preferred Stock and additionally, upon occurrence of event of default i.e. non repayment of the Sod Sciences May Note, shall further entitle the Sod to seek $241,200 worth of Convertible Preferred Stock as Penalty Shares.

On June 04, 2026, we closed a Securities Purchase Agreement with DLL for convertible promissory note in original principal amount of $180,800.00. Similar to the June and July 2025 Bridge Notes, in the event of defaults, the note holders may convert the outstanding amount (includes principal, accrued interest, default interest, and other fees as applicable) into the Company’s Common stock at a conversion price equal to 75% of the lowest closing bid price of the Company’s Common stock during the 10 trading days immediately prior to the applicable conversion date.

On June 22, 2026, the Company entered into a Promissory Note for Provision of Services with Heskin & Proper PLLC (“Heskin Note”) for a total services amount of $180,000.00. The note consists of a current amount of $33,000.00, which includes a $30,000.00 obligation for legal services previously rendered plus a $3,000.00 original issue discount, due on or before November 30, 2026. Additionally, the note accounts for future services valued at up to $150,000.00, which, subject to Board approval and definitive agreements, are to be satisfied through the issuance of Preferred Stock within its ongoing Bridge Financing 2026.

On July 2, 2026, Zoomcar Holdings, Inc. issued a convertible promissory note to Silvercrest Hybrid Capital LLC (“Silvercrest”) in original principal amount of $120,000 (the “Silvercrest Note”). The original issue discount was $12,000, resulting in net proceeds of $100,000 after deduction of legal and due diligence fee. At the option of the holder, the outstanding balance can be converted into common stock following the earlier of 180 calendar days or an event of default, at a conversion price equal to 73% of the lowest closing bid price during the 15 trading days preceding the conversion date.

We believe that the current cash and cash equivalents will allow us to continue operations through September 30, 2026 assuming we make partial payments on our currently outstanding indebtedness and future accruals, however there can be no assurance that this will be the case. Accordingly, we believe that additional funds will be required to support operations and, in the long term, the growth of our business. Our operations have consumed substantial amounts of cash, and we have incurred operating losses since we began operating in 2013. While our cash consumption has been reduced following our business transition from short-term rental of vehicles owned by or leased to Zoomcar to an online platform for peer-to-peer car sharing, we have consumed significant amounts of cash in effecting such transition in terms of technology and platform innovation, and our cash consumption has varied over time. Our cash needs will depend on numerous factors, including our revenues, upgrade and innovation of our peer-to-peer car sharing platform, customer and market acceptance and use of our platform, and our ability to reduce and control costs. We expect to devote substantial capital resources to, among other things, fund operations, continued improvement, upgrading or innovation of our platform, and expand our international outreach. If we are unable to secure such additional financing, it will have a material adverse effect on our business, and we may not be able to meet our obligations or continue as a going concern.

We may not have sufficient authorized but unissued shares of Common Stock to satisfy our obligations under the Series A Convertible Preferred Stock, the Warrants, the convertible notes, our other outstanding convertible and equity-linked securities, and our contemplated Tender Offers.

Our certificate of incorporation currently authorizes 250,000,000 shares of Common Stock and 10,000,000 shares of preferred stock (including the Series A Convertible Preferred Stock). The number of shares of Common Stock issuable upon (i) conversion of the Series A Convertible Preferred Stock (whether at the fixed Conversion Price, after giving effect to any anti-dilution adjustment, or at the alternate conversion price), (ii) exercise of the Warrants, (iii) conversion of the existing convertible notes (if and to the extent the variable conversion price becomes available), (iv) exercise or conversion of our other outstanding warrants, options, restricted stock units and convertible securities, and (v) consummation of our contemplated Tender Offers (which contemplate the issuance of shares of Common Stock at exchange ratios of up to 20,000 shares of Common Stock per surrendered warrant), in each case is highly variable and, in the aggregate, may exceed the number of shares of Common Stock currently authorized and available for issuance. The Company has previously disclosed, including in the tender offer statement on Schedule TO filed with the SEC on January 23, 2026 (as subsequently amended), that the consummation of the Tender Offers is expected to be conditioned on stockholder approval of an amendment to our certificate of incorporation to increase the number of authorized shares of Common Stock. There can be no assurance that we will be able to obtain such stockholder approval, or any other required stockholder approvals, on a timely basis or at all. If we are unable to obtain a sufficient increase in our authorized shares of Common Stock when needed, we may be unable to satisfy our obligations to issue shares of Common Stock under the Series A Convertible Preferred Stock, the Warrants, the existing convertible notes, our other outstanding convertible and equity-linked securities, or in the Tender Offers, which could result in our breach of our obligations under those instruments, give rise to claims for damages or specific performance, or otherwise materially adversely affect our business, financial condition, results of operations and prospects.

The accelerated registration rights described in this Supplement are subject to SEC rules, market conditions, and our continued ability to remain current in our Exchange Act reporting, and there can be no assurance that resale registration statements will be filed or declared effective on the timeline contemplated.

Although the registration rights described in the respective registration rights agreements for the Series A Preferred Stock that the Company will file a resale registration statement within fifteen calendar days after each closing and use its best efforts to cause such registration statement to be declared effective on accelerated timelines, the Company’s ability to register and to keep effective resale registration statements covering the Conversion Shares and the Warrant Shares is subject to a number of factors outside the Company’s control, including SEC review timelines and comments, SEC rules and policies regarding primary versus secondary offerings, the size of our public float, our status and history as a former shell company, and our ability to remain current in our Exchange Act reporting. There can be no assurance that resale registration statements will be filed or declared effective on the timeline contemplated, and the failure to do so may result in our payment of liquidated damages and may delay holders’ ability to resell the Conversion Shares and Warrant Shares in the public markets, particularly during the period preceding the Alternate Conversion Effective Date.

Our ability to continue as a going concern depends on our ability to raise additional capital, and recent financings have involved highly dilutive or restrictive terms.

Zoomcar has relied on multiple bridge financings and other short-term capital raises to fund its operations. These financings have involved significant issuance costs, discounts, warrants, preferred securities or other terms that are dilutive to existing stockholders or impose restrictions on the Company’s operations. There can be no assurance that the Company will be able to obtain additional financing on acceptable terms, or at all. There can be no assurance that financing will be available in a timely manner or in amounts or on terms acceptable to us, or at all. If additional financing is not available when needed, the Company may be required to curtail or suspend its operations.

Risks Related to Our Operations as a Public Company

Our Common Stock is quoted on an OTC Markets Group trading platform, the OTCQB, instead of a national exchange or quotation system. Accordingly, our investors may experience significant volatility in the market price of our Common Stock and have difficulty selling their shares.

Our Common Stock is currently quoted on an OTC Markets Group trading platform, the OTCQB, under the ticker symbol “ZCAR.” The OTC Markets Group is a regulated quotation service that displays real-time quotes, last sale prices, and volume limitations in over-the-counter securities. Trading in shares quoted on an OTC Markets Group trading platform is often thin and characterized by volatility in trading prices. This volatility may be caused by a variety of factors, including the lack of readily available price quotations, the absence of consistent administrative supervision of bid and ask quotations, lower trading volume, and market conditions. This volatility may be caused by a variety of factors, including the lack of readily available price quotations, the absence of consistent administrative supervision of bid and ask quotations, lower trading volume, and market conditions. As a result, there may be wide fluctuations in the market price of the shares of our Common Stock for reasons unrelated to operating performance, and this volatility, when it occurs, may have a negative effect on the market price for our securities. As a result, there may be wide fluctuations in the market price of the shares of our Common Stock for reasons unrelated to operating performance, and this volatility, when it occurs, may have a negative effect on the market price for our securities. Moreover, the OTC Markets Group is not a stock exchange, and trading of securities on one of its trading platforms is often more sporadic than the trading of securities listed on a national quotation system or stock exchange. Moreover, the OTC Markets Group is not a stock exchange, and trading of securities on one of its trading platforms is often more sporadic than the trading of securities listed on a national quotation system or stock exchange. Accordingly, our stockholders may not be able to realize a fair price from their shares when they determine to sell them or may have to hold them for a substantial period of time until the market for our Common Stock improves.

Because our Common Stock is quoted on the OTCQB and not listed on a national exchange , U.S. broker-dealers may be discouraged from effecting transactions in shares of our Common Stock because it may be considered a penny stock and thus be subject to the penny stock rules.

The SEC has adopted a number of rules to regulate a “penny stock” that restricts transactions involving stock which is deemed to be a penny stock. Such rules include Rules 3a51-1, 15g-1, 15g-2, 15g-3, 15g-4, 15g-5, 15g-6, 5g-7, and 15g-9 under the Exchange Act. These rules may have the effect of reducing the liquidity of penny stocks. “Penny stocks” generally are equity securities with a price of less than $5.00 per share (other than securities registered on certain national securities exchanges or traded on Nasdaq if current price and volume information with respect to transactions in such securities is provided by the exchange or system). Our shares of common stock may, in the future constitute, a “penny stock” within the meaning of the rules. The additional sales practice and disclosure requirements imposed upon U.S. broker-dealers may discourage such broker-dealers from effecting transactions in shares of our common stock, which could severely limit the market liquidity of such shares of common stock and impede their sale in the secondary market.

A U.S. broker-dealer selling a penny stock to anyone other than an established customer or “accredited investor” (generally, an individual with a net worth in excess of $1,000,000 or an annual income exceeding $200,000, or $300,000 together with his or her spouse) must make a special suitability determination for the purchaser and must receive the purchaser’s written consent to the transaction prior to sale, unless the broker-dealer or the transaction is otherwise exempt. In addition, the “penny stock” regulations require the U.S. broker-dealer to deliver, prior to any transaction involving a “penny stock”, a disclosure schedule prepared in accordance with SEC standards relating to the “penny stock” market, unless the broker-dealer or the transaction is otherwise exempt. A U.S. broker-dealer is also required to disclose commissions payable to the U.S. broker-dealer and the registered representative and current quotations for the securities. Finally, a U.S. broker-dealer is required to submit monthly statements disclosing recent price information with respect to any “penny stock” held in a customer’s account and information with respect to the limited market in “penny stocks.”

You should be aware that, according to the SEC, the market for “penny stocks” has suffered in recent years from patterns of fraud and abuse. Such patterns include (i) control of the market for the security by one or a few broker-dealers that are often related to the promoter or issuer; (ii) manipulation of prices through prearranged matching of purchases and sales and false and misleading press releases; (iii) “boiler room” practices involving high-pressure sales tactics and unrealistic price projections by inexperienced sales persons; (iv) excessive and undisclosed bid-ask differentials and markups by selling broker-dealers; and (v) the wholesale dumping of the same securities by promoters and broker-dealers after prices have been manipulated to a desired level, resulting in investor losses. Our management is aware of the abuses that have occurred historically in the penny stock market. Although we do not expect to be in a position to dictate the behavior of the market or of broker-dealers who participate in the market, management will strive within the confines of practical limitations to prevent the described patterns from being established with respect to our securities.

On August 5, 2025, we received notice from the OTCQX U.S. tier of OTC Markets Group that our Global Market Capitalization has been below the $5.0 million minimum for more than 30 consecutive calendar days, and that we therefore no longer satisfy OTCQX continued qualification standards.

Following receipt of the notice and after evaluating available alternatives, the Company elected to transition its quotation to the OTCQB tier of OTC Markets Group (“OTCQB”).

On November 4, 2025, the Company’s Common Stock commenced trading on the OTCQB under the ticker symbol “ZCAR.” The transition from the OTCQX to the OTCQB does not affect the Company’s reporting obligations under the Securities Exchange Act of 1934, as amended, or the public trading of its securities in the United States.

Failure to comply with the continued qualification standards within, and any removal from OTCQB could materially and adversely affect the liquidity and market price of our common stock and our access to capital.

Earlier on August 5, 2025, we had received a written notice from the OTCQX U.S. tier of OTC Markets Group stating that our Global Market Capitalization has remained below the minimum $5.0 million required under Section 2.1(B) of the OTCQX Rules for U.S. Companies for more than 30 consecutive calendar days and, as a result, we no longer satisfy the OTCQX standards for continued qualification. Under those rules, we have a 90-calendar-day cure period, expiring on November 3, 2025, to regain compliance by maintaining a Global Market Capitalization of at least $5.0 million for 10 consecutive trading days. Following receipt of the notice and after evaluating available alternatives, the Company elected to transition its quotation to the OTCQB tier of OTC Markets Group (“OTCQB”).

On November 4, 2025, the Company’s Common Stock commenced trading on the OTCQB under the ticker symbol “ZCAR.” The transition from the OTCQX to the OTCQB does not affect the Company’s reporting obligations under the Securities Exchange Act of 1934, as amended, or the public trading of its securities in the United States.

If the Company fails to comply with the OTCQB Rules its securities could be removed from OTCQB and may trade on a less liquid market tier or otherwise experience reduced liquidity. Any such outcome could, among other things: (i) further depress the market price and increase the volatility of our common stock; (ii) limit or preclude the ability of certain brokers to make a market in, or of certain institutional investors to purchase or hold, our securities; (iii) reduce analyst coverage and overall investor interest; (iv) impair our ability to raise additional capital on acceptable terms or at all; and (v) adversely affect the terms of any financing or strategic transactions we may seek. In an effort to regain or maintain compliance, the Company may consider and pursue one or more corporate or financing actions—such as equity or equity-linked issuances, strategic transactions, or other measures—which could be dilutive to existing stockholders, increase our leverage, or otherwise involve significant costs and risks. Even if the Company regains compliance, it may be unable to sustain it, and any future failure could have the same adverse effects.

We require additional capital to support current operations and will require additional capital to support the growth of our business, which may not be available on terms acceptable to us, or at all.

To continue current operations, we will need to raise capital imminently. Further, to continue to effectively compete thereafter, we will require additional funds to support the growth of our business. Our operations have consumed substantial amounts of cash, and we have incurred operating losses, since we began operating in 2013. While our cash consumption has been reduced following our business transition from short-term rental of vehicles owned by or leased to Zoomcar to an online platform for peer-to-peer car sharing, we have consumed significant amounts of cash in effecting such transition in terms of technology and platform innovation, and our cash consumption has varied over time. Because of our limited resources the company was not able to expand to emerging markets outside of India and in fact, discontinued operations in Vietnam during June 2023 and the entity was thereafter adjudged bankrupt in January 2026 and subsequently operations in Egypt, Indonesia were also discontinued during June 2024 as a result. Because of our limited resources the company was not able to expand to emerging markets outside of India and in fact, discontinued operations in Vietnam during June 2023 and subsequently in Egypt, Indonesia during June 2024 as a result.

Our expenses have increased substantially in connection with actions and efforts required to operate as a public company. During the year ended March 31, 2026, we have incurred expenses in maintaining the listing requirements and complying with statutory filings with SEC along with significant professional and consultancy fee to professionals and we contemplate that we will continue to incur these expenses as long as we remain a public company to fulfill which we will need additional capital.

Our expenses to increase moderately in connection with growth in our business operations. We do not currently have sufficient cash resources to operate our business beyond September 2026 (assuming that we partially repay some of our currently outstanding indebtedness) and accordingly, will need to raise capital imminently to continue our operations and to fully execute our business plan. We do not currently have sufficient cash resources to operate our business beyond June 2025 (assuming that we do not repay any of our currently outstanding indebtedness) and accordingly, will need to raise capital imminently to continue our operations and to fully execute our business plan. Additionally, circumstances could cause us to consume capital more rapidly than we currently anticipate and if our cash resources are insufficient to satisfy our cash requirements, we may seek to issue additional equity or debt securities or obtain new or expanded credit facilities or identify and secure additional sources of capital. Our ability to obtain external financing in the future is subject to a variety of uncertainties, including our future financial condition, results of operations, cash flows, share price performance, liquidity of capital and lending markets and governmental regulations in India. In addition, incurring indebtedness would subject us to increased debt service obligations and could result in operating and financing covenants that would restrict our operations. There can be no assurance that financing will be available in a timely manner or in amounts or on terms acceptable to us, or at all. Any failure to raise needed funds on terms favorable to us, or at all, will severely restrict our liquidity as well as have a material adverse effect on our business, financial condition and results of operations. In addition, any issuance of equity or equity-linked securities could result in significant dilution to our existing shareholders. Additionally, fundraising efforts may divert our management from its day-to-day duties and activities, which may affect our ability to execute on our business plan. If we do not raise substantial additional capital imminently to continue operations in the short term or otherwise when required or in sufficient amounts and on acceptable terms, we may need to:

Our future funding requirements, both short-term and long-term, depend on many factors, including but not limited to:

If lack of available capital prevents us from proceeding with the execution of our business plan, our ability to become profitable will be compromised and our business will be harmed.

Future sales of our securities may affect the market price of the Common Stock and result in material dilution, including the anti-dilution protection in the warrants issued in 2024. We are also in default of various outstanding debt obligations, including under the Notes issued to ACM, and may issue shares of Common Stock or other securities to satisfy those obligations in the future (in the case of ACM, subject to receipt of shareholder approval). The issuance of shares of Common Stock or other securities in the future and the shares issued during the Tender Offer and preferred stock issued in the Bridge Financing 2026 will dilute your percentage ownership interest and may also result in downward pressure on the price of our Common Stock.

We will finance our immediate cash needs (and expect to finance our future cash needs until we become profitable, if ever) through equity offerings, debt financings or other third-party funding, marketing and distribution arrangements and other collaborations, strategic alliances and licensing arrangements. We will require substantial funding to fund our business. In June 2024 we issued warrants that contain an “alternative cashless exercise” provision which gives the warrant holder the right to exchange the warrant on a one-for-one basis for shares of Common Stock at any time that the warrant is exercisable without any cash payment and without regard to the then market price of the Company’s Common Stock or exercise price of the warrant. In addition, the warrants include a provision that resets the warrant exercise price with a proportionate adjustment to the number of shares underlying the warrant in the event of a reverse split of the Company’s Common Stock at any time between the issuance date and the three year anniversary of the issuance date (a “Share Combination Event”). In the event of a Share Combination Event, the exercise price of the warrant will be reset to a price equal to the lesser of (i) the then exercise price and (ii) the lowest volume weighted average price (VWAP) during the period commencing five trading days immediately after the date the Company effects both the reverse stock splits, subject to a floor price of $283.2 prior to receipt of stockholder approval or $56.64 following receipt of stockholder approval (in each case, adjusted for any stock dividend, stock split, stock combination, reclassification or similar transaction, the “Floor Price”). The warrants are also subject to full ratchet anti-dilution protection for any issuances of Company securities (other than certain excluded issuances) at a price or effective price (as determined in accordance with the terms of the warrant, the “Dilutive Issuance Price”) that is less than the then current exercise price of the warrants following the issuance date (a “Dilutive Issuance”). In the event of a Dilutive Issuance, the exercise price of the warrants will be reduced to the lower of the Dilutive Issuance Price and the lowest VWAP during the five consecutive trading days commencing after the date of the Dilutive Issuance, in each case, subject to the Floor Price, and there will be a proportionate adjustment to the number of shares underlying the warrant. In connection with the Business Combination, we also issued the Notes to ACM in satisfaction of certain transaction expenses associated with the Business Combination. The Notes contain price based anti-dilution protection on the conversion price of such Notes down to a floor price of $500 per share (considering both reverse stock splits effectuated by the Company) which has already been reached. While the Notes have already converted into the maximum number of shares permissible under the terms of the Notes without receiving stockholder approval, we may seek stockholder approval in the future to allow for the Notes to convert into additional shares. To the extent that we raise additional capital through the sale of equity or convertible debt securities, your ownership interest will be diluted, anti-dilution provision may be triggered, and the terms of the newly issued securities may include liquidation or other preferences that adversely affect your rights.

Any future adjustments to the exercise price of the warrants (or additional issuances to make the Financing Investors whole) may have a negative impact on the trading price of our Common Stock. Additionally, raising additional capital with new investors may be difficult as a result of anti-dilution protection. Sales of substantial amounts of Common Stock in the public market, or the perception that such sales could occur, could materially adversely affect the market price of the Common Stock and may make it more difficult for you to sell your securities at a time and price which you deem appropriate.

Additionally, on January 23, 2026, the Company commenced an offer to exchange (the “Offer to Exchange”) eligible outstanding warrants for shares of the Company’s common stock, par value $0.0001 per share, upon the terms and subject to the conditions set forth in the Company’s offer to exchange, dated January 23, 2026 (as it may be amended or supplemented from time to time, the “Offer to Exchange”), and the related letter(s) of transmittal and consent, notice(s) of withdrawal and other offer materials (together with the Offer to Exchange, as amended or supplemented from time to time, the “Offer Materials”).

The Offer to Exchange relates to eligible holders of the Company’s outstanding: Common Warrants, (ii) Series A Warrants, (iii) Series B Warrants, (iv) pre-funded warrants to purchase shares of common), (v) Bridge placement agent common stock purchase warrants issued in connection with the Company’s bridge financing on June 18, 2024 (the “Bridge Placement Agent Warrants”), (vi) placement agent common stock purchase warrants issued in connection with the Company’s private placement dated November 5, 2024 (the “Placement Agent Warrants”), and (vii) Series A placement agent warrants issued in connection with the Company’s private placement dated November 5, 2024 (the “Series A Placement Agent Warrants” and, together with the Common Warrants, Series A Warrants, Series B Warrants, Pre-Funded Warrants, Bridge Placement Agent Warrants and Placement Agent Warrants, the “Existing Warrants”).

Under the Offer to Exchange, subject to the terms and conditions described in the Offer Materials, the Company is offering to exchange the Existing Warrants for shares of Common Stock. The Offer to Exchange is conditioned upon, among other things, the adoption by the Company’s stockholders of an amendment to the Company’s Amended and Restated Certificate of Incorporation to increase the number of authorized shares of Common Stock (the “Authorized Share Increase”) and the filing and effectiveness of such amendment with the Secretary of State of the State of Delaware.

Upon receipt of such Stockholder Approval, the Company expects to issue a large number of shares of common stock in exchange of the Existing Warrants which may further have a negative impact on the trading price of our Common Stock.

In addition to above, on June 2, 2026, Zoomcar Holdings, Inc. (the “Company”) entered into a securities purchase agreement (the “TE Purchase Agreement”) with certain accredited investors (the “TE Purchasers”) in connection with the initial closing (the “First Closing”) of a private placement of the Company’s Series A units (the “Units”), each Unit consisting of (i) one share of the Company’s Series A Convertible Preferred Stock, par value $0.0001 per share (the “Preferred Shares”), and (ii) one Series A warrant to purchase one share of the Company’s common stock, par value $0.0001 per share (the “Common Stock”) (the “Warrants,” and the entire transaction, the “Bridge Financing 2026”). The Units were sold at a purchase price of $1,000 per Unit. The Offering provides for the sale of up to an aggregate of $5,000,000 of Units, plus up to an additional $5,000,000 of Units issuable pursuant to an overallotment option exercisable by the placement agent in its sole discretion, in one or more closings, with a minimum subscription threshold of $1,000,000 having been satisfied.

At the First Closing, the Company issued and sold an aggregate of 1,143 Units, consisting of 1,143 Preferred Shares and Warrants to purchase up to 1,143 shares of Common Stock, of which 50 units 50 Units were revoked/cancelled as one of the investors failed to meet the requisite compliance requirements. for aggregate gross proceeds to the Company of approximately $1,143,000, before deducting placement agent fees and offering expenses. Accordingly, 1,093 units were issued at the First Closing.

At “Second Closing” on June 18, 2026, the Company issued and sold an aggregate of 537 Units, consisting of 537 Preferred Shares and Warrants to purchase up to 537 shares of Common Stock, for aggregate gross proceeds to the Company of approximately $537,000, before deducting placement agent fees and offering expenses.

At “Third Closing” on June 30, 2026, the Company issued and sold an aggregate of 195 Units, consisting of 195 Preferred Shares and Warrants to purchase up to 195 shares of Common Stock, for aggregate gross proceeds to the Company of approximately $195,000 before deducting placement agent fees and offering expenses.

The Preferred Shares are convertible into shares of Common Stock in accordance with the terms of the Amended and Restated Certificate of Designation of Preferences, Rights and Limitations of the Series A Convertible Preferred Stock (the “Certificate of Designation”), at an initial conversion price of $0.05 per share, subject to adjustment as provided therein, including pursuant to an alternate conversion right and price-reset provisions set forth in the Certificate of Designation. The Warrants have an exercise price of $0.0625 per share, subject to adjustment as provided therein, are exercisable beginning on the date of issuance, and expire five (5) years from the date of issuance.

The total shares of Common Stock issuable upon exercise of preferred stock conversion of preferred stock across the First Closing, Second Closing and Third Closing are 36,490,000 and an equal number of warrants are issuable upon exercise of the Series A Warrants.

ThinkEquity LLC (the “Placement Agent”) acted as the exclusive placement agent for the Offering pursuant to a placement agent agreement, dated as of June 2, 2026, June 18, 2026 and June 30, 2026 (the “TE Placement Agent Agreements”), between the Company and the Placement Agent. As compensation for its services, the Company agreed to pay the Placement Agent a cash fee equal to 10.0% of the aggregate gross proceeds received by the Company from the Purchasers at each closing, to pay a non-accountable expense allowance equal to 1.0% of the gross proceeds, and to issue to the Placement Agent (or its designees) warrants (the “Placement Agent Warrants”) to purchase a number of shares of Common Stock equal to 10% of the shares of Common Stock underlying the securities sold in the Offering, assuming full conversion. The Company issued Placement Agent Warrants to purchase up to 3,649,000 shares of Common Stock, having terms substantially similar to the Warrants.

The full conversion of the Preferred Shares and exercise of the warrants (including those issued to the Placement Agent) issued in the Bridge Financing 2026 are likely to result in the issuance of a massive volume of common stock relative to our current outstanding shares. In the event of such large-scale issuance or resale of these shares, or even the market perception that these conversions will occur, could adversely affect the market price of our common stock which may experience severe downward pressure, significantly shrinking the equity value of existing common stockholders.

In addition to our defaults under current indebtedness described elsewhere here, certain of our debt financing arrangements are currently in default and we have delayed certain other payments to lenders, which may restrict our current and future business and operations.

Since November 2023, we have been in violation of our scheduled monthly installment payment obligations of $215,337 per month on our lease liability with Ayvens Group (f/k/a Leaseplan India Private Limited) (“Leaseplan”). Leaseplan notified us on February 7, 2024, that we are in default of our November 2023 payment. As of the date hereof, we are in default beyond the 30-day extended cure period (as envisaged under the terms of our debt with Leaseplan) of our November 2023 payment and continue to be default of all EMIs thereafter. As a result of such defaults, as of the date hereof, Leaseplan (i) has initiated the process of repossession of all vehicles, and (ii) has invoked the bank guarantee of $120,482 which was a security created by Zoomcar in favor of Leaseplan. Such outcomes may have a material adverse impact on our business, operations or financial condition. The Company continues to negotiate a deferred payment plan to the restructured debt proposal shared by the Company wherein the debt after certain waivers and discounts, will stand restructured to $4,755,942 and the Company is hopeful that Leaseplan will issue a comfort letter in this regard acknowledging the proposed payment schedule spread across six tranches repayment of the restructured debt. Based on the most recent discussions with Leaseplan, the Company continues to negotiate a payment plan to the restructured debt proposal shared by the Company wherein the debt after certain waivers and discounts, will stand restructured to $4,755,942 and the Company is hopeful that Leaseplan will issue a comfort letter in this regard acknowledging the proposed payment schedule spread across six tranches repayment of the restructured debt. , Currently, the Company has already cleared the first three tranches in accordance with the proposed payment schedule as per the comfort letter, amounting to $2,847,177 (approx. As of the date hereof, the Company has already cleared the first three tranches in accordance with the proposed payment schedule as per the comfort letter, amounting to $2,851,924 (approx. ) towards the outstanding debt. The Company is yet to clear the fourth tranche of payment (as per the proposed payment schedule) which was due as of July 31, 2025. The Company also requested a further extension to repay the remaining three tranches. However, on December 22, 2025, the Company received a Demand Notice from LeasePlan demanding the outstanding dues payable per the resolution agreement initially entered into by the Company and Leaseplan in August 2021 be released promptly. The Company is still discussing a deferred payment plan with LeasePlan and has made certain part payments towards these dues and awaits LeasePlan’s confirmation on the extension sought. As of May 05, 2026, the Company still has $3,536,123 pending dues towards LeasePlan. If LeasePlan refuses to provide us an extension for making the deferred payments, or if we are unable to execute a settlement agreement with respect to the restructured debt, or fail to honor the obligations under any proposals accepted or agreement executed for the subject matter it may, possibly result in inter alia (a) the entire outstanding debt becoming due and payable, and (b) the withdrawal of a conditional waiver of $1.2 million—which was granted during a prior restructuring making it immediately due and payable with interest of 1.5% per month.

The Company is in breach of the final payment obligation of $ 346,295 (approx.) (inclusive of interest accrued) on its loan with Mahindra & Mahindra Financial Services Limited (“Mahindra”). Mahindra has not formally extended or provided waiver of such overdue payment. For the period the overdue amount remains unpaid, interest accrues at the rate of 3% per month.

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 June 2026. 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.

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 July 13, 2026, we have issued and outstanding options to purchase 15 and 1 shares of our Common Stock with a weighted average exercise prices of $300 and $120 respectively, pre-funded warrants to purchase 5,306,013 shares of Common Stock, warrants to purchase 19,831 shares of Common Stock with an exercise price of $6,000 per share which were assumed by the Company in connection with the Business Combination, 11,499,991 Public Warrants to purchase 5,750 shares of our Common Stock, each Public Warrant exercisable into one two-thousandth of one share of Common Stock at an exercise price of $11,420.00 per full share, warrants to purchase 5,297 shares of Common Stock at a current exercise price of $56.64 per share which were issued to the Placement Agent in June 2024, November Series A Warrants to purchase 763,294 shares of Common Stock at a current exercise price of $16.12, November Series B Warrants to purchase up to 5,865 shares at an exercise price of $0.002 per share, November 2024 Placement Agent warrants to purchase 53,447 shares at a current exercise price of $16.12 per share, November 2024 Placement Agent Series A warrants to purchase 106,893 shares at a current exercise price of $16.12 per share.

As of July 13, 2026, we also have issued and outstanding December 2024 Series A Warrants to purchase 5,009 shares of Common Stock at a current exercise price of $6.24 per share, December Series B Warrants to purchase up to 94,238 shares of Common Stock at a current exercise price of $0.002 per share,

As of July 13, 2026, we also have issued and outstanding February 2025 Series B Warrants to purchase up to 89,744 shares of Common Stock at a current price of $0.002 per share,

As of July 13, 2026, we have also issued and outstanding March 2024 Series A Warrants to purchase 2,544,134 shares of Common Stock at a current exercise price of $6.24 per share, and March Series B Warrants to purchase up to 591,275 shares of Common Stock at a current exercise price of $0.002 per share,

All Series B Warrants issued in the December Offering, the January/February Offering and the March Offering are exercisable for the maximum number of shares of Common Stock, because on March 18, 2025. the Board determined to fix the “Reset Price” of all of such Series B Warrants down to the “Floor Price” of $6.24 per share. The Company has agreed to deem the “Reset Date” of the Series B Warrants to be effective.

On June 2, 2026, the Company entered into a securities purchase agreement for a private pursuant to which we completed a first closing of 1,143 Series A units at $1,000 per unit for gross proceeds of approximately $1,143,000, with the potential to sell up to $10,000,000 in total units including an overallotment option.

On June 18, 2026 entered into a securities purchase agreement for a private pursuant to which we completed a second closing of 537 Series A units at $1,000 per unit for gross proceeds of approximately $537,000.

On June 30, 2026 entered into a securities purchase agreement for a private pursuant to which we completed a third closing of 195 Series A units at $1,000 per unit for gross proceeds of approximately $195,000.

Each unit consists of one share of Series A Convertible Preferred Stock, initially convertible at $0.05 per share (subject to alternate conversion rights and price-reset adjustments), and one five-year warrant to purchase one share of Common Stock at an exercise price of $0.0625 per share.

Accordingly,

Because the market for our Common Stock is thinly traded, the sales and/or the perception that those sales may occur, could adversely affect the market price of our Common Stock. Furthermore, even though, as of the date hereof, the options and warrants are all currently out of the money (other than the Series B Warrants, which all have an exercise price of $0.002 per share), the mere existence of a significant number of shares of Common Stock issuable upon exercise of these securities may be perceived by the market as having a potential dilutive effect, which could lead to a decrease in the price of our Common Stock.

The completion of the warrant exchange offer would result in the issuance of a substantial number of shares of common stock and significant dilution to existing stockholders without generating additional cash proceeds.

If the warrant exchange offer is completed, the Company expects to issue a substantial number of shares of common stock in exchange for tendered warrants. The issuance of these shares will dilute the ownership interests of existing stockholders and may adversely affect the market price of the Company’s common stock. In addition, the exchange of warrants for shares of common stock will not result in any cash proceeds to the Company, and therefore will not improve the Company’s liquidity position. As a result, even if the offer is completed, the Company will continue to require additional financing to fund its operations.

If the warrant exchange offer is completed with respect to some, but not all, classes of outstanding warrants, the Company’s capital structure may remain complex and the anticipated reduction in warrant overhang may not be realized.

The Company may complete the warrant exchange offer with respect to certain classes of warrants but not others. In such event, a portion of the outstanding warrants would remain exercisable or outstanding, and the Company’s capital structure could continue to reflect a significant potential dilutive overhang. This could adversely affect the market price of the Company’s common stock, investor perception and the Company’s ability to raise additional capital.

Risks related to our Business and Operations

Our current business model’s limited operating history and financial results make our future results, prospects and the risks we may encounter difficult to predict.

Although Zoomcar commenced operating in 2013, we have recently transitioned from a prior business model to our current business model, consisting of our asset-light online platform for peer-to-peer car sharing. As a result of this transition, certain components of our financial statements have experienced variation, and our operating history may not be indicative of our future growth or financial results. The limited history of our current business model makes predicting our future operating and other results difficult, if not impossible, and there is no assurance that we will be able to grow our revenues in future periods. Our results of operations are impacted by a number of factors, some of which are beyond our control, and we may suffer adverse impacts to our further development as a result of circumstances which include decreasing customer demand, increasing competition, declining growth of the car sharing industry in general, insufficient supply of vehicles on our platform, or changes in government policies or general economic conditions. We will continue to develop and improve the features, functions, technologies and other offerings on our platform to increase our Guest and Host bases and volume of bookings on our platform. However, the execution of our business plan is subject to uncertainty and bookings may not grow at the rate we expect. If our growth rates decline, investors’ perceptions of our business and prospects may be adversely affected and the market price of our common stock could decline.

Existing and potential holders of our securities should also consider the risks and uncertainties that a company with a limited history, such as ours, will face in the evolving personal mobility solutions market. In particular, there can be no assurance that we will:

Our new “Bikes by Zoomcar” business segment is subject to operational uncertainties, and we cannot guarantee its long-term viability, profitability, or continuity.

We recently launched a new business segment, “Bikes by Zoomcar,” expanding our platform’s shared mobility marketplace from automobiles to two-wheeler vehicles such as scooters and motorcycles. This segment represents a relatively untested offering within our marketplace infrastructure, and its long-term success is highly uncertain. Our ability to successfully operate, scale, and maintain continuity for this segment faces numerous challenges, including operational risks such as rapid asset wear and tear, rider misuse, and a higher vulnerability to vehicle theft, vandalism, and fraudulent bookings that may evade our existing risk detection mechanisms. Furthermore, we are dependent on our fleet partners to maintain the supply of the inventory over our marketplace for this offering.

The two-wheeler rental market is governed by complex, hyper-local state transport regulations, commercial permit quotas, and shifting municipal micromobility policies, meaning that any failure to maintain regulatory compliance could abruptly freeze local operations. Additionally, this space is intensely competitive and price-sensitive, featuring established ride-hailing platforms, dedicated bike-rental startups, and public transit alternatives.

Because the unit economics of shared two-wheelers differ fundamentally from our core car-sharing marketplace, our historical performance is not indicative of this segment’s future financial results, and we cannot assure you that this new business segment will achieve or sustain profitability. As we continuously evaluate the operational data, market demand, regulatory landscape, and margins of this segment, we may choose to materially alter, suspend, pivot, or entirely discontinue the “Bikes by Zoomcar” offerings at any time and without prior notice. We could potentially lose the services of any of our senior management personnel at any time due to a variety of factors that could include, without limitation, death, incapacity, military service, personal issues, retirement, resignation or competing employers. Any decision to change or terminate these offerings, or any failure of the segment to achieve expected growth, could result in asset impairment charges, damage to our brand reputation, and an adverse impact on our overall business, financial condition, and results of operations. Any future determination to pay dividends will be at the discretion of our Board and will depend on our financial condition, results of operations, capital requirements, and future agreements and financing instruments, business prospects and such other factors as our Board deems relevant.

Our operating and financial forecasts are subject to various known and unknown contingencies and factors outside of our control and may not prove accurate, and we may not achieve results consistent with management’s expectations.

Our quarterly and annual operating results have fluctuated in the past and are likely to fluctuate in the future. During any given period, our operating and financial results may be influenced by numerous factors, many of which are unpredictable or are outside of our control. Additionally, our limited operating history with our current peer-to-peer car sharing business model makes it difficult for us to forecast our future results and subjects us to a number of uncertainties, including our ability to plan for and anticipate future growth. As a result, you should not rely upon our past quarterly and annual operating results as indicators of future performance. We have encountered, and will continue to encounter, risks and uncertainties frequently experienced by growing companies in rapidly evolving markets, such as the risks and uncertainties described herein.

We have a history of operating losses and negative cash flow, we have limited cash resources, we will need to raise additional funds imminently to finance operations and as a result there is substantial doubt about our ability to continue as a going concern.

We have a history of operating losses and expect to continue incurring operating losses in the foreseeable future as we continue to develop our current business model and enhance our platform offerings. We also have indebtedness that is in default in excess of our current capital resources (see “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources” in our Form 10-Q for the nine months ended December 31 2025). On June 18, 2024, the Company entered into a securities purchase agreement with certain institutional accredited investors (the “June Aegis Securities Purchase Agreement”) pursuant to which the Company issued and sold an aggregate of $3,600,000 in principal amount of notes (the “June Notes”) and warrants to purchase up to an aggregate of 1,267,728 shares of Common Stock (which takes into account an adjustment following the Company’s Share Combination Event that was effective on October 22, 2024) (the “June Warrants”) for gross proceeds of $3,000,000.

Additionally, on November 7, 2024, the Company closed the November 7 Placement for gross proceeds of $9.15 million (including $2.5 million of which was provided by one of the Company’s directors) (before deduction of fees to the placement agent and other offering expenses payable by the Company). The Placement Agent in this Offering acted as exclusive placement agent in the November 7 Placement. At closing of the November 7 Placement, the Company issued an aggregate of 2,137,850 units at a price of $4.28 per unit, each unit consisting of one share of Common Stock (or pre-funded warrant in lieu thereof), two November Series A Warrants (as hereinafter defined) each to purchase one share of Common Stock and a November Series B Warrant (as hereinafter defined) to purchase such number of shares of Common Stock, as determined on the November Reset Date, which does not reflect the Second Reverse Split. As a result of the November 7 Placement, the Company received $3.62 million of cash and cash equivalents after giving effect to offering fees and expenses, the payment of $3.8 million to the holders of the Company’s June 2024 notes and a holdback of $0.2 million for indemnification of the Placement Agent as described in more detail herein.

Further, on December 24, 2024, the Company held the First Closing of this Offering for gross proceeds of $5,484,843 (including $50,000 of which was provided by the Company’s former Chief Executive Officer i.e., Hiroshi Nishijima and $300,000 of which was provided by a consultant to the Company) (before deduction of fees to the placement agent and other offering expenses payable by the Company). The Placement Agent in this Offering acted as exclusive placement agent at the First Closing. At the First Closing, the Company issued an aggregate of (i) 3,095,925 shares of Common Stock, which does not reflect the Second Reverse Split (ii) Pre-Funded Warrants issued to certain of the investors, at their option, exercisable for an aggregate of up to 420,000 shares of Common Stock, which does not reflect the Second Reverse Split, to the extent that the issuance of shares of Common Stock would cause such Investors to beneficially own more than 4.99% or 9.99% of the shares of Common Stock outstanding. Also issued along with the shares of Common Stock and/or the Pre-Funded Warrants were (x) Series A Warrants to initially purchase up to an aggregate of 8,680,443 shares of Common Stock, which does not reflect the Second Reverse Split, subject to certain adjustments and (y) Series B Warrants to initially purchase no shares of Common Stock, subject to certain adjustments as provided in the Series B Warrants. As a result of the First Closing, the Company received $4,786,963 of cash and cash equivalents after giving effect to offering fees and expenses.

Further, on February 4, 2025, the Company held the Second Closing of this Offering for gross proceeds of $1,437,936 (before deduction of fees to the Placement Agent and other offering expenses payable by the Company). The Placement Agent in this Offering acted as exclusive placement agent at the Second Closing. At the Second Closing, the Company issued an aggregate of (i) 1,049,796 shares of Common Stock, which does not reflect the Second Reverse Split (ii) Pre-Funded Warrants issued to certain of the investors, at their option, exercisable for an aggregate of up to 872,000 shares of Common Stock, which does not reflect the Second Reverse Split, to the extent that the issuance of shares of Common Stock would cause such Investors to beneficially own more than 4.99% or 9.99% of the shares of Common Stock outstanding. Also issued along with the shares of Common Stock and/or the Pre-Funded Warrants were (x) Series A Warrants to initially purchase up to an aggregate of 4,804,491 shares of Common Stock, which does not reflect the Second Reverse Split, subject to certain adjustments and (y) Series B Warrants to initially purchase no shares of Common Stock, subject to certain adjustments as provided in the Series B Warrants. As a result of the First Closing, the Company received $1,249,911 of cash and cash equivalents after giving effect to offering fees and expenses.

On June 24, 2025, the Company closed two Securities Purchase Agreements (each, a “Purchase Agreement”) with 1800 Diagonal Lending LLC, a Virginia limited liability company (“DLL”), and Boot Capital LLC, a Delaware limited liability company (“Boot”) (both investors collectively “June 2025 Noteholders”), respectively, in connection with a private placement offering of convertible bridge notes (each, a “Note” and collectively, the “Notes”) in the aggregate principal amount of $290,240.00 and $111,760.00, respectively. Pursuant to the Purchase Agreements, DLL purchased a Note in the original principal amount of $290,240.00 with an original issue discount of $30,240.00 and net proceeds to the Company of $250,000.00, after fees. Boot purchased a Note in the original principal amount of $111,760.00 with an original issue discount of $11,760.00 and net proceeds to the Company of $100,000.00. Each Note bears interest at a rate of 12% per annum and is due on March 30, 2026. The Notes include scheduled installment repayments, and may be prepaid in full by the Company at a discount to the outstanding balance. The Notes are subject to default interest at a rate of 22% per annum and include customary events of default and covenants. The repayment obligations under these notes have been fully discharged as of the date of filing of this Form 10-K. Refer to Exhibits 10.58 and 10.59 which are incorporated here by reference for term of these Notes.

On July 31, 2025 , the Company further entered into two Securities Purchase Agreements (each a “Purchase Agreement”) with 1800 Diagonal Lending LLC, a Virginia limited liability company (“DLL”), and Boot Capital LLC, a Delaware limited liability company (“Boot”) (both investors collectively “July 2025 Noteholders”), respectively pursuant to which the Company issued convertible Bridge Notes(“July Bridge Notes”) for a total principal amount of $206,225 with an initial issue discount of $23,725. The net proceeds disbursed to the Company were $175,000 after deduction of legal and due diligence fees of $7,500. Hence, the total debt issuance costs amounts to $7,500. The Bridge notes have a maturity date of May 31, 2026, and bear interest at an annual rate of 12%. The notes include scheduled monthly installment repayments and interest payments starting August 30, 2025 and may be prepaid in part or full, by the Company at a discount to the outstanding balance. The notes are subject to default interest rate of 22% per annum and include customary events of default. The repayment obligations under the July Bridge Notes have been fully discharged as of the date of filing of this Form 10-K. Refer to Exhibits 10.58 and 10.59 which are incorporated here by reference for term of these Notes.

On August 19, 2025, the Company closed a Securities Purchase Agreement (“Labrys SPA”) with Labrys Fund II, L.P. (“Labrys”) in connection for purchase of a promissory note convertible on default. Pursuant to the Labrys SPA, Labrys purchased a note for a principal amount $180,000 with an original issue discount of $18,000 (“Labrys Note”)and net proceeds to the Company of $158,500 after adjusting issuance cost of $3,500. The note is repayable in 12 months maturing on August 19, 2026 with interest accruing at 12 % per annum on the outstanding principal. This note is subject to a default interest at a rate of 22% per annum and include customary events of default and covenants.

On August 24, 2025, the Company closed a Securities Purchase Agreement (“AES SPA”) with AES Capital Management, LLC(“AES”) in connection with purchase of convertible redeemable notes. Pursuant to the AES SPA, AES purchased 2 notes for an aggregate principal amount $112,500split into $75,000and $37,500 respectively (“AES Notes”). The note amounting $75,000 is the “Primary Notes” and the subsequent note of $37,500 is the “Secondary Note”. The AES Notes are repayable in 12 months from their respective closing dates with interest accruing at 8% per annum on the outstanding principal. As of date of filing of this 10-Q, the Company received net proceeds of $ 71,000 after adjusting deduction of legal and due diligence fees of $4,000 from the issuance and closing of the Primary Notes. The AES Notes are subject to a default interest at a rate of 22% per annum and include customary events of default and covenants.

On August 24, 2025, the Company closed a Securities Purchase Agreement (“CFI SPA”) with CFI CAPITAL LLC (“CFI”) in connection with purchase of convertible redeemable notes. Pursuant to the CFI SPA, CFI purchased a convertible for a principal amount of $150,000 at an original issue discount of $15,000. The note is repayable in 12 months maturing on August 24, 2026 with interest accruing at 6 % per annum on the outstanding principal. The Company received net proceeds of $130,000 after adjusting issuance cost of $5000. This note is subject to a default penalty amounting to increase in the principal amount by 50% and includes customary events of default and covenants.

On November 28, 2025, we closed two Securities Purchase Agreements with DLL and Boot (“Purchase Agreements”)” for 2 convertible bridge notes (“November DLL/Boot Notes”). Pursuant to the Purchase Agreements, DLL purchased a Note in the original principal amount of $152,550.00 with an original issue discount of $17,550.00 and net proceeds to the Company of $125,000.00, after fees. Boot purchased a Note in the original principal amount of $56,500 with an original issue discount of $6,500.00 and net proceeds to the Company of $50,000.00. Each The notes bear interest at 12% per annum, are due September 30, 2026, include installment repayment features and may be prepaid at a discount, but are subject to default interest of 22% per annum and customary events of default and covenants. The notes include scheduled monthly installment repayments and interest payments starting December 30, 2025 and may be prepaid in part or full, by the Company at a discount to the outstanding balance. Refer to Exhibits 10.58 and 10.59 which are incorporated here by reference for terms of these Notes.

On December 10, 2025, we entered into a Securities Purchase Agreement with FirstFire Global Opportunities Fund, LLC, (“FirstFire”) and issued a convertible redeemable note (“FirstFire Note”) in a principal amount of $220,000 with an original issue discount of $20,000 resulting in net proceeds of $200,000 after fees. The note bears interest at 12% per annum, matures 12 months after issuance on December 10, 2026 and is subject to a default penalty that increases the principal amount by 50% and includes customary events of default and covenants. The notes include scheduled monthly installment repayments and interest payments starting January 08, 2026 and may be prepaid in part or full by the Company at a discount to the outstanding balance. Refer to Exhibits 10.60, 10.61 and 10.62 which are incorporated here by reference for terms of the FirstFire Note.

On December 24, 2025, we entered into a Securities Purchase Agreement with AUCTUS FUND, LLC, (“Auctus”) and issued a promissory note for a principal amount of $125,000 with an original issue discount of $12,500 (“Auctus Note”) resulting in net proceeds of approximately $100,000 after fees. The note bears interest at 10% per annum with a guaranteed interest at issuance. It matures 12 months after issuance on December 24, 2026, is subject to a default interest of an additional 8% per annum and includes customary events of default and covenants. It is convertible after the later of (a) 180 days from issuance and (b) upon an event of default under the Auctus Note. The scheduled monthly installment repayments and interest payments start on June 24, 2026 and may be prepaid in part or full, by the Company at a discount to the outstanding balance.

On January 8, 2026 we entered into a Securities Purchase Agreement with Quick Capital LLC (“Quick Capital”) and issued a convertible note for principal amount of $42,613.64 with an original discount of $5,113.64 (“Quick Capital Note”) resulting in net proceeds of approximately $35,000 after fees. The Quick Capital Note bears interest at 12% per annum with a guaranteed interest at issuance, matures 6 months after issuance on July 08, 2026, and is subject to default interest of 22% per annum and includes customary events of default and covenants. It is convertible anytime or upon default and bears piggyback registration rights. The repayment obligations under the Quick Capital Note have been fully discharged as of the date of filing of this Form 10-K.

“February Notes” (DLL & Boot): On February 25, 2026, the Company closed two Securities Purchase Agreements with DLL and Boot for convertible promissory notes in original principal amounts of $180,800.00 and $84,750.00, respectively. The original issue discounts were $20,800 by DLL and $9,750 by Boot resulting in net proceeds of $150,000 and $75,000 respectively. Each The notes bear interest at 12% per annum, are due December 30, 2026, include installment repayment features and may be prepaid at a discount, but are subject to default interest of 22% per annum and customary events of default and covenants. The notes include scheduled monthly installment repayments and interest payments starting August 30, 2026 and may be prepaid in part or full, by the Company at a discount to the outstanding balance. Refer to Exhibits 10.58 and 10.59 which are incorporated here by reference for terms of these Notes.

On April 5, 2026 the Company issued a Promissory Note to Walsh Industries (“Walsh industries”) for principal amount of $100,000 (“Walsh Note”) with an original discount of $5,000 resulting in net proceeds of $95,000. The Walsh Note matures in one (1) week. In addition to the repayment obligation the Company is also required to issue $50,000 worth of Convertible Preferred Stock and additionally, upon occurrence of event of default i.e. non repayment of the Walsh Note, shall further entitle the Walsh Industries to seek $50,000 worth of Convertible Preferred Stock as Penalty Shares. The Preferred Stock issued therein bears piggyback registration rights. While the repayment obligations have been discharged with delays, the Company is yet to issue the Preferred Stock worth $100,000 (including the Penalty Shares) is pending issuance at the date of filing of this Form 10-K.

On April 23, 2026 the Company issued a Promissory Note to Sod Sciences Inc.(“Sod Sciences”) for principal amount of $22,500.00 (“Sod Sciences April Note”) with an original discount of $2,500 resulting in net proceeds of $20,000. The Sod Sciences April Note matures in one (1) month. In addition to the repayment obligation the Company is also required to issue $100,000 worth of Convertible Preferred Stock and additionally, upon occurrence of event of default i.e. non repayment of the Sod Sciences April Note, shall further entitle the Sod to seek $100,000 worth of Convertible Preferred Stock as Penalty Shares. The Preferred Stock issued therein bears piggyback registration rights

On May 5, 2026 the Company issued another Promissory Note to Sod Sciences Inc.(“Sod Sciences”) for principal amount of $48,231 (“Sod Sciences May Note”) with an original discount of $4,385.30 resulting in net proceeds of $43,845.70. The Sod Sciences May Note matures in one (1) month In addition to the repayment obligation the Company is also required to issue $241,200 worth of Convertible Preferred Stock and additionally, upon occurrence of event of default i.e. non repayment of the Sod Sciences May Note, shall further entitle the Sod to seek $241,200 worth of Convertible Preferred Stock as Penalty Shares. The Preferred Stock issued therein bears piggyback registration rights.

On June 04, 2026, we closed a Securities Purchase Agreement with DLL for convertible promissory note in original principal amount of $180,800.00 (“DLL June 2026 Note”). The original issue discounts was $20,800 resulting in net proceeds of $150,000 after deduction of due diligence and legal fees. The DLL June 14, 2026 Note bears interest at 12% per annum, are due March 30, 2027, include installment repayment features and may be prepaid at a discount, but are subject to default interest of 22% per annum and customary events of default and covenants. The notes include scheduled monthly installment repayments and interest payments starting November 30, 2026 and may be prepaid in part or full, by the Company at a discount to the outstanding balance. Refer to Exhibits 10.58 and 10.59 which are incorporated here by reference for terms of these Notes.

On June 22, 2026, the Company entered into a Promissory Note for Provision of Services with Heskin & Proper PLLC (“Heskin Note”) for a total services amount of $180,000.00. The note consists of a current amount of $33,000.00, which includes a $30,000.00 obligation for legal services previously rendered plus a $3,000.00 original issue discount, due on or before November 30, 2026. Additionally, the note accounts for future services valued at up to $150,000.00, which, subject to Board approval and definitive agreements, are to be satisfied through the issuance of Preferred Stock within its ongoing Bridge Financing 2026.

On July 2, 2026, Zoomcar Holdings, Inc. issued a convertible promissory note to Silvercrest Hybrid Capital LLC (“Silvercrest”) in original principal amount of $120,000 (the “Silvercrest Note”). The original issue discount was $12,000, resulting in net proceeds of $100,000 after deduction of legal and due diligence fee. The Silvercrest Note bears interest at 10% per annum, with the first twelve months of interest ($12,000.00) guaranteed and earned in full as of the issue date. The note is due on July 2, 2027, includes instalment repayment features and may be prepaid at a discount, but is subject to default interest of 8% per annum and customary events of default and covenants. At the option of the holder, the outstanding balance can be converted into common stock following the earlier of 180 calendar days or an event of default, at a conversion price equal to 73% of the lowest closing bid price during the 15 trading days preceding the conversion date.

Further, on June 2, 2026, the Company entered into a private placement transaction (the Bridge Financing 2026) to sell Series A Units to accredited investors at $1,000 per unit, completing its initial closing by selling 1,143 units for approximately $1.143 million in gross proceeds.

On June 18, 2026 entered into a securities purchase agreement for a private pursuant to which we completed a second closing of 537 Series A units at $1,000 per unit for gross proceeds of approximately $537,000.

On June 30, 2026 entered into a securities purchase agreement for a private pursuant to which we completed a second closing of 195 Series A units at $1,000 per unit for gross proceeds of approximately $195,000.

The Company believes that current cash and cash equivalents will allow the Company to continue operations through September 30, 2026 assuming that the Company makes partial payments on its currently outstanding indebtedness and only pays current operating accruals, however, there can be no assurance that this will be the case. Even if our current cash position supports operations through September 30, 2026, we cannot assure that this cash will be sufficient in the longer run and we will be required to obtain a further infusion of cash funds to support our operations or address the indebtedness, including through this offering. The Company will still need to seek financing for the purpose of raising additional funds to be able to meet its obligations and so that there will no longer be substantial doubt about its ability to continue as a going concern. However, there is no assurance that the Company will be able to raise any such financing or, even if it does, that it will be sufficient for it to meet its obligations or continue as a going concern.

The Company as on July 13, 2026 has $0.17 million of cash and cash equivalents.

Accordingly, we believe that additional funds will be imminently required to support current operations and, in the long term, the growth of our business. Our operations have consumed substantial amounts of cash, and we have incurred operating losses since we began operating in 2013. While our cash consumption has been reduced following our business transition from short-term rental of vehicles owned by or leased to Zoomcar to an online platform for peer-to-peer car sharing, we have consumed significant amounts of cash in effecting such transition in terms of technology and platform innovation, and our cash consumption has varied over time. Our cash needs will depend on numerous factors, including our revenues, upgrade and innovation of our peer-to-peer car sharing platform, customer and market acceptance and use of our platform, and our ability to reduce and control costs. We expect to devote substantial capital resources to, among other things, fund operations, continued improvement, upgrading or innovation of our platform, and expand our international outreach. If we are unable to secure such additional financing, it will have a material adverse effect on our business, and we may have to limit operations in a manner inconsistent with our development. If we are unable to secure such additional financing, it will have a material adverse effect on our business, and we may not be able to meet our obligations or continue as a going concern.

The market for online platforms for peer-to-peer car sharing is relatively new and rapidly evolving. If we fail to successfully adapt to developments in our market, or if peer-to-peer car sharing online platforms do not achieve general acceptance, it could adversely affect our business, financial condition and operating results.

In December 2021, we transitioned to our current peer-to-peer cash sharing business model. The market for online peer-to-peer car sharing platforms is relatively new and unproven and the data and research available regarding the market or the industry may be limited and unreliable. It is uncertain whether the peer-to-peer car sharing market will continue to develop or if our platform will achieve and sustain a level of demand and market acceptance sufficient for us to generate meaningful revenue, net income, and cash flow. Our success will depend to a substantial extent on the willingness of Hosts and Guests to use our platform to identify car sharing opportunities. Some Hosts may be reluctant or unwilling to make their vehicles available for use on our platform because of concerns which may include, but are not limited to, potential decline in the value of their vehicle if listed on our platform, uncertainty of economic benefits from platform usage, ability to recover losses associated with lost or damaged property, compliance with our platform’s terms of use, data privacy and security concerns, or other reasons.

In addition, our success also requires utilization of our platform by Guests to book vehicles. Guests’ willingness to utilize our platform may depend, among other factors, on Guests’ belief in the ease-of use, integrity, quality, availability, safety, cost-effectiveness, convenience and reliability of our platform and the vehicles listed by Hosts for bookings thereon. Any shift in Guest preferences in the markets in which we operate could have a material adverse effect on our business. Additionally, Guests may be reluctant or unwilling to use a platform requiring Guests to provide personally identifiable information, payment information and driver’s license details, or have their driving behaviors monitored during bookings. Further, Guests may be reluctant to book vehicles containing GPS-enabled tracking or monitoring devices accessible by Zoomcar, or to use our platform at all due to the perception of the use of such devices.

If we do not retain existing Hosts, or attract and maintain new Hosts, or if Hosts fail to provide an adequate supply of high-quality vehicles, our business, financial condition, and results of operations may be negatively impacted.

Our success in a given geographic market depends on our ability to establish and grow the scale of our platform in that market by attracting Hosts and Guests to our platform. We depend upon having Hosts register high quality vehicles on our platform, maintain the safety and cleanliness of their vehicles, and ensure that the descriptions and availability of their vehicles on our platform are accurate and up-to-date. These practices are beyond our direct control and the number of vehicles shared by Hosts and resulting bookings options available to Guests on our platform may decline based on a number of factors including, among other things, public health and safety concerns, including pandemics/epidemics; economic, social, and political factors; state laws and regulations regarding car sharing, or the absence of such laws and regulations, challenges obtaining, insuring, financing and servicing vehicles to list on the platform, some of which may be exacerbated by infrastructure challenges in the emerging market where we operate our business. If Hosts register and offer fewer high-quality vehicles to Guests on our platform, our bookings and revenues may decline, and our results of operations could be materially adversely affected. Further, if Hosts with available vehicles choose not to offer their vehicles through our platform because competitive car sharing platforms emerge that Hosts find more attractive than our platform, Hosts may be unwilling to continue registering vehicles or making them available for bookings through the platform. Further, if Hosts with available vehicles choose not to offer their vehicles through our platform because competitive carsharing platforms emerge that Hosts find more attractive than our platform, Hosts may be unwilling to continue registering vehicles or making them available for bookings through the platform. For example, Hosts may cease or reduce vehicle registrations or the periods of time they make cars available for bookings for any number of reasons, such as competitor platforms having more Guests making bookings, risk of vehicle damage for which Hosts may not be able to recoup damages from Zoomcar or for any other reason, we may lack sufficient supply of vehicles to attract Guests to utilize our platform. For example, Hosts may cease or reduce vehicle registrations or the periods of time they make cars available for bookings for any number of reasons, such as competitor platforms having more Guests making bookings, risk of vehicle damage for which Hosts may not be able to recoup damages from Zoomcar or hesitancy to install the IoT GPS-enabled tracking device we require Hosts to affix to vehicles upon platform registration or for any other reason, we may lack sufficient supply of vehicles to attract Guests to utilize our platform. If Hosts do not share sufficient numbers of vehicles, or if the vehicles they register to our platform are less attractive to Guests than vehicles offered by competitors, our revenue would likely decline and our business, financial condition, and results of operations could be materially adversely affected.

Hosts are not required to make their vehicles available on our platform for a minimum sharing period or number of bookings and Hosts may choose not to share their vehicles on our platform at all if we cannot generate sufficient demand for their vehicles or if bookings through our platform are not sufficiently attractive to Hosts to retain and attract Hosts to use the platform. While we continue to invest in tools and resources to support Hosts, the pricing features and other capabilities of our platform may not be as attractive to Hosts as those developed by our competitors, and Hosts may not share their vehicles on our platform as a result. If Hosts perceive that listing vehicles on our platform may be insufficiently remunerative to, for example, offset any leasing, financing, parking, registration, maintenance, and repair costs of vehicles registered to the platform, we may lose or fail to attract Hosts and may not be able to make a sufficient number of vehicles available for use by our Guests.

If we fail to retain existing Guests, or attract and maintain new Guests, our business, financial condition, and results of operations may be negatively impacted.

Our business model depends on our ability to retain and attract Guests to make bookings on our platform. There are a number of trends in and aspects of Guest preferences which have an impact on us and the car sharing industry as a whole. These include, among others, preferences for types of vehicles, convenience of online bookings, and monetary savings associated with car sharing and platform bookings relative to other possible transportation solutions. Any shift in Guest preferences, which are susceptible to change, in the markets in which we operate could have a material adverse effect on our business. For example, if the vehicles registered to our platform are not popular or of sufficient quality or are not available at locations convenient for Guests, Guests may lose interest in utilizing our platform. Additionally, if Guests find our platform not to be user-friendly or to lack functions that Guests expect from a car sharing or other online platform, Guests may decrease or stop using our platform. Our competitiveness therefore depends on our ability to predict and quickly adapt to Guest trends, exploiting profitable opportunities for platform development, innovation and upgrades without alienating our existing Guest base or focusing excessive resources or attention on unprofitable or short-lived trends. If we are unable to respond on a timely and appropriate basis to changes in demand or Guest preferences, our business may be adversely affected.

Additionally, if we are unable to compete with other car sharing platforms and other mobility solutions in the markets in which we operate, our bookings will decrease, and our financial results will be adversely affected. Guests desiring to book vehicles through our platform must pay booking fees, which include, among other fees, “upfront booking fees,” less any applicable discounts and credits, and “value added” or trip-protection fees payable at the time of a booking; other charges may also be incurred by Guests after a booking, such as trip cancellation fees, gasoline fees, late fees and other charges. Many of these fees are generated through our platform functions and some of the fees are selected by Guests from a range of options presented to them at the time of a booking. If our booking and trip-related fees are not competitive, or our platform functionality is not appealing or outdated, or negative reviews or publications are released in connection with our platform, Guests may stop or reduce their use of our platform, our business, results of operations, reputation, and financial condition may be adversely affected.

If we are unable to introduce new or upgraded platform features that Hosts or Guests recognize as valuable, we may fail to retain and attract such users to our platform and our operating results would be adversely affected.

To continue to retain and attract Hosts and Guests to our platform, we will need to continue to introduce new or upgraded features or product offerings, functions and technologies that add value for Hosts and Guests that differentiate us from our competitors. Developing and delivering these new or upgraded features, functions and technologies is costly, and the success of such features, functions and technologies depends on several factors, including the timely completion, introduction, and market acceptance of such features, functions and technologies. Moreover, any such new or upgraded features, functions and technologies may not work as intended or may not provide intended value to Hosts and Guests. If we are unable to continue to develop new or upgraded features, functions and technologies, or if Hosts and Guests do not perceive value in such new or upgraded features, functions and technologies, Hosts and Guests may choose not to use our platform, which would adversely affect our operating results.

We have made substantial investments to develop new or upgraded features, functions and technologies, and we intend to continue investing significant resources in developing new technologies, tools, features, services and other platform offerings. If we are unable to attract/retain and pay qualified technical staff required to continue our platform feature development efforts, we may not realize the expected benefits of our developments.

There can be no assurance that the new developments will exist or be sustained at the levels that we expect, or that any of these new developments will gain sufficient traction or market acceptance to generate enough revenue to offset any new expenses or liabilities associated with these new investments. Our development efforts with respect to new features, functions and technologies on our platform could distract management from current operations and will divert capital and other resources from our more established functions and technologies. Even if we are successful in developing new features, functions or technologies, or otherwise update or upgrade our platform, regulatory authorities may subject us to new rules or restrictions in response to our innovations that could increase our expenses or prevent us from successfully commercializing the new features, functions, technologies, updates or upgrades of our platform. If we are unable to adapt in a cost-effective and timely manner in response to the changing market conditions or platform users’ preferences, either for technical, legal, financial or other reasons, our business, financial condition and results of operations may be materially and adversely affected.

Our success depends upon our ability to maintain favorable customer reviews and ratings, and if our reputation suffers, our business, financial condition and operating results may be adversely affected.

We have a customized rating and review system connected to our search-and-ranking-base algorithm in order to provide a more holistic, more relevant overall search experience for the Guests. By combining Host ratings and reviews into the overall sort algorithm, our platform is able to highlight particular Hosts who are more likely to receive bookings. The reliable and trustworthy ratings and reviews of our Hosts and Guests are crucial to our business, which will to a substantial extent affect our Hosts and Guests’ determination as to whether to utilize the platform to book cars.

Monitor the rating and review system on an ongoing basis to enforce quality standards and build trust among members of our community. We have procedures in place to combat fraud or abuse of our rating and review system, but there is no assurance that these procedures are or will be effective, or at all. Further, Hosts and Guests can leave reviews or ratings on third-party platforms or websites, which are out of our control and off platform reviews and ratings or other statements about the platform, or a business or brand may have adverse impact on our business operations. If any Hosts and Guests leave negative ratings and reviews, it may not only cause a decrease in the number of existing Hosts and Guests, but also may negatively affect acquisitions of new Hosts and Guests, which may adversely affect our business, financial conditions and results of operations. Unreliable ratings and reviews could also make it more difficult for us to enforce quality standards, which could damage our reputation and reduce trust within our community.

Additionally, our ability to attract and retain Hosts and Guests is dependent in part on our ability to provide high-quality customer support services. Hosts and Guests depend on our customer support centers to resolve any issues relating to our platform both during and after their trips. As we continue to grow our business and improve our platform, we will face challenges related to providing high-quality support services at scale. Any failure to maintain high-quality support, or a market perception that we do not maintain high-quality support, could harm our reputation and adversely affect our ability to scale our platform and business, our financial condition, and results of operations.

A former employee of Zoomcar India has instituted a wrongful termination suit and claims that certain Zoomcar options have vested.

In February 2023, a former employee of Zoomcar India instituted a suit before the City Civil and Sessions Judge at Mayo Hall, Bengaluru against Zoomcar India, Zoomcar and IOAC challenging his termination, claiming approximately $400,000 in damages and claiming that 100,000 options to purchase shares of Zoomcar have vested. On March 3, 2023, the City Civil and Sessions Judge at Mayo Hall, Bengaluru, issued an interim injunction to restrain each of Zoomcar and IOAC from “alienating or dealing” the 100,000 shares(without giving effect to the reverse splits and the conversion ratio for the business combination) of Zoomcar claimed by the former employee while the suit is pending. On March 3, 2023, the City Civil and Sessions Judge at Mayo Hall, Bengaluru, issued an interim injunction to restrain each of Zoomcar and IOAC from “alienating or dealing” the 100,000 shares of Zoomcar claimed by the former employee while the suit is pending. Zoomcar believes that such claims are baseless and is attempting to have the interim order vacated. In addition, Zoomcar India filed an application in the former employee’s suit, seeking that IOAC be deleted from the array of parties in the suit, inter alia since (i) IOAC is neither a necessary nor a proper party to the suit; (ii) no reliefs have been sought by the former employee from IOAC; and (iii) there is no cause of action against IOAC. However, there can be no assurance that Zoomcar India and Zoomcar will be successful in their efforts to have the matter vacated or IOAC deleted from the parties, and such efforts may be time-consuming, costly and may have reputational and other negative effects on Zoomcar.

The founder and former CEO of the Company has initiated a civil complaint against the Company contesting the reasons for his termination and has raised certain other claims with regards to his ownership of the Company and compensation for termination of his employment.

On September 26, 2024, we received a copy of a complaint filed with the United States District Court for the District of Delaware wherein our founder and former CEO Greg Moran has challenged the Company’s termination of his employment for cause, effective as of June 18, 2024. Mr. Moran has contested the facts leading up to the grounds on which his termination was based and has also claimed that this alleged wrongful termination has deprived him of his vested right to 8% of the Company’s outstanding equity that he claims was owed to him under his Employment Agreement. He has also claimed that in connection with his termination he is entitled to the payment of certain amounts for unused paid leave during his employment with Zoomcar, along with certain other compensation he claims to be owed under the terms of his Employment Agreement, including “Owed Severance” equal to approximately $72,000. In total, Mr. Moran seeks damages of at least $238,000 plus damages associated with the 8% of shares. He also seeks damages under the New York Labor Law, under which he seeks liquidated damages equal to 100% of any unpaid wages. He also seeks damages under the New York Labor Law, under which he seeks liquidated damages equal to 100% of any unpaid wages. He claims that all of the above constitute wages under New York Labor Law. He claims that all of the above constitute wages under New York Labor Law.

Zoomcar believes that the termination of Mr. Moran’s employment for cause was proper in accordance with the terms of his Employment Agreement. Mr. Moran’s case in the District Court was dismissed on account of Mr. Moran’s stated intention to refile the case in Delaware Superior Court. Mr. Moran refiled his lawsuit in the Superior Court of the State of Delaware on November 1, 2024. On November 27, 2024, the Company filed a motion to dismiss certain of the causes of action for failure to state a cause of action, and the briefing on that motion was filed on January 7, 2025. Mr. Moran filed opposition to Zoomcar’s motion on February 5, 2025 and Zoomcar filed a reply in further support of its motion on February 20, 2025. Zoomcar’s oral arguments in its motion to dismiss were heard on April 29, 2025. The Court has requested additional briefing with respect to the Company’s motion to dismiss Mr. Moran filed opposition to Zoomcar’s motion on February 5, 2025 and Zoomcar filed a reply in further support of its motion on February 20, 2025. Zoomcar’s oral arguments in its motion to dismiss were heard on April 29, 2025. The court granted the motion to dismiss Mr. Moran’s Wage claim. The additional briefing was due on August 15, 2025. The court granted the motion to dismiss Mr. Moran’s quasi-contractual claims and reserved decision on the balance of the motion. On November 20, 2025, the court further granted the motion to dismiss Mr. Moran’s tortious interference with contract claim and breach of New York labor law claim. However, there can be no assurance that the Company will be successful in defending these claims in its entirety and such efforts may be time-consuming, costly and may have reputational and other negative effects on Zoomcar.

Further on March 16, 2026, the Company and Mr. Moran entered into a settlement agreement (the “Settlement Agreement”) resolving the litigation. The Settlement Agreement provides for the Company’s payment of $150,000 in installments and mutual releases of all claims, with no admission of liability by any party. The matter will be dismissed with prejudice upon completion of the settlement payments. Refer to Exhibit 10.55 for the terms of settlement agreement with Mr. Greg Moran which is incorporate by reference herewith.

The ACM Letter Agreement imposes significant cash payment, securities issuance, capital raise participation and other obligations on the Company, and ACM’s discretionary right to terminate the Courtesy Standstill Period creates significant ongoing risk to the Company.

ACM had filed a notice of motion for summary judgement in lieu of complaint against Zoomcar in New York courts for payment of amounts due under the Note pursuant to breach of the terms of the Note. The Company received two default notices from ACM. The first notice was issued on May 22, 2024 which stated that the Company is in default of the terms of the Unsecured Convertible Note issued to ACM on December 28, 2023, since the Company had entered into an equity line arrangement with White Lion Capital LLC, a variable rate transaction, without the prior consent of ACM. Further, on June 25, 2024, the Company received the second notice of default from ACM stating that the Company has incurred indebtedness in the form of $3,600,000 in principal amount of notes in a transaction involving Aegis Capital Corp. acting as the placement agent, prior to which, the consent of ACM was not obtained. As per the terms of the ACM note, in the event of any default, all accrued but unpaid interest plus liquidated damages and other amounts thereof, shall become immediately due and payable in cash.

On November 7, 2024, ACM filed a notice of motion for summary judgement in in lieu of complaint (“Motion”) against Zoomcar in New York State Supreme Court, New York County, alleging it was entitled to accelerated payment of $5,997,832.72 pursuant to the terms of an unsecured promissory note issued by Zoomcar to ACM on December 28, 2023 (“Note”) as consideration for certain alleged, bona fide expenses that ACM’s members had aggregated and assigned to ACM for collection from Zoomcar. As alleged by ACM in its moving papers, two “Events of Default” (as defined in the Note) had occurred thereby entitling ACM to full and accelerated payment of the Note. As alleged by ACM in its moving papers, two “Events of Default” (as defined in the Note) had occurred thereby entitling ACM to full and accelerated payment of the Note. The first was a Form 8-K, filed by Zoomcar on May 9, 2024, which allegedly disclosed that on May 6, 2024, Zoomcar had entered into an equity line arrangement and “Variable Rate Transaction” (as defined in the Note) with White Lion Capital LLC (“White Lion”). The first was a Form 8-K, filed by Zoomcar on May 9, 2024, which allegedly disclosed that on May 6, 2024, Zoomcar had entered into an equity line arrangement and “Variable Rate Transaction” (as defined in the Note) with White Lion Capital LLC (“White Lion”). The second was a Form 8-K, filed by Zoomcar on June 21, 2024, which allegedly disclosed that on June 18, 2024, Zoomcar had incurred a form of debt that was not “Excluded Debt” (as defined in the Note) arising from its placement agent agreement with Aegis Capital Corp. The second was a Form 8-K, filed by Zoomcar on June 21, 2024, which allegedly disclosed that on June 18, 2024, Zoomcar had incurred a form of debt that was not “Excluded Debt” (as defined in the Note) arising from its placement agent agreement with Aegis Capital Corp. without ACM’s prior consent. The Note generally provides that, upon the occurrence of an Event of Default, all accrued but unpaid interest plus liquidated damages and other amounts thereof shall become immediately due and payable to the Note holder. The Note generally provides that, upon the occurrence of an Event of Default, all accrued but unpaid interest plus liquidated damages and other amounts thereof shall become immediately due and payable to the Note holder.

Zoomcar believes it has meritorious defenses to the Motion and intends to zealously defend itself. As such, on January 14, 2025, Zoomcar filed opposition to the Motion. As such, on January 14, 2025, Zoomcar filed opposition to the Motion. In relevant part, Zoomcar challenged the fact allegations concerning: (i) the first Form 8-K by tendering to the Court evidence confirming that the subject transaction with White Lion in fact had been terminated and the underlying filing of a Form S-1 registration statement contemplated in that transaction was never effectuated; and (ii) the second Form 8-K by tendering to the Court evidence confirming that the subject transaction involved Excluded Debt. In relevant part, Zoomcar challenged the fact allegations concerning: (i) the first Form 8-K by tendering to the Court evidence confirming that the subject transaction with White Lion in fact had been terminated and the underlying filing of a Form S-1 registration statement contemplated in that transaction was never effectuated; and (ii) the second Form 8-K by tendering to the Court evidence confirming that the subject transaction involved Excluded Debt. The effect of the foregoing is the transactions were excluded from the definitions of Events of Default and extinguished ACM’s alleged entitlement to accelerated payment under the Note. The effect of the foregoing is the transactions were excluded from the definitions of Events of Default and extinguished ACM’s alleged entitlement to accelerated payment under the Note. Additional defenses were also presented by Zoomcar to the Motion. Additional defenses were also presented by Zoomcar to the Motion. On March 28, 2025, New York County Supreme Court Justice granted a summary judgment in favor of ACM in the amount of $5,656,086.72, as well as default interest in the amount of $346,481.00, post-judgment interest at the statutory rate, attorneys’ fees, and costs. On March 28, 2025, New York County Supreme Court Justice granted a summary judgment in favor of ACM in the amount of $5,656,086.72, as well as default interest in the amount of $346,481.00, post-judgment interest at the statutory rate, attorneys’ fees, and costs. The issue of attorneys’ fees was referred to a special referee to report and recommend on submission from the parties. The issue of attorneys’ fees was referred to a special referee to report and recommend on submission from the parties. On May 9, 2025, the Court reduced the award of attorneys’ fees and costs to $12,000.00. On April 22, 2025, the Company filed a Notice of Appeal seeking to reverse the March 28, 2025, order granting summary judgment in favor of ACM. On May 9, 2025, the Court reduced the award of attorneys’ fees and costs to $12,000.00. On April 22, 2025, the Company filed a Notice of Appeal seeking to reverse the March 28, 2025, order granting summary judgment in favor of ACM. On May 11, 2026, the Company and ACM entered into a letter agreement (the “ACM Letter Agreement”) setting forth the parties’ agreement regarding the path forward to resolve this dispute above mentioned litigation and underlying disputes therein.

Pursuant to the ACM Letter Agreement, the Company is obligated to pay $2,500,000 in cash to ACM on or before October 31, 2026, with ACM entitled to receive at least 10% of the gross proceeds of any capital raising activity of the Company (and a greater percentage to the extent any other creditor receives a greater percentage of such proceeds). The receipt by ACM of at least 10% of the gross proceeds of each Closing of this Offering will reduce the amount of net proceeds available to the Company for working capital, repayment of the Existing Convertible Notes and other corporate purposes. Once the $2,500,000 cash payment has been made in full, the residual balance of the ACM Judgment, which the parties acknowledge as approximately $3,500,000 as of the date of the ACM Letter Agreement, will be satisfied by the issuance of equity securities to ACM at the price and on the economic terms of any subsequent Company financing closed prior to the date the cash payment is made in full. The issuance of such equity securities will result in additional dilution to investors in this Offering, the magnitude of which will depend on the timing and pricing of subsequent financings (if any), and to the extent such financings price at lower per share prices than the price at which the Series A Convertible Preferred Stock was issued, will trigger anti-dilution adjustments to the Conversion Price under Section 6(e) of the Certificate of Designation.

In addition, although the ACM Letter Agreement provides for a “Courtesy Standstill Period” through March 31, 2027, ACM retains the unilateral right, in its sole discretion and without any right of the Company to challenge such determination, to terminate the Courtesy Standstill Period at any time if ACM believes that the Company is not working to satisfy the cash payment obligation. If ACM elects to terminate the Courtesy Standstill Period, ACM may resume enforcement and realization actions against the Company in respect of the ACM Judgment, including levying on Company assets and bank accounts that the Company is required to disclose to ACM under the ACM Letter Agreement. The Company had agreed to (i) submit a confession of judgment to ACM with respect to the ACM Judgment, (ii) withdraw all pending appeals of the ACM Judgment, and (iii) provide ACM with a list of all of its assets and bank accounts all of which substantially limit the Company’s ability to defend against, or delay, ACM’s enforcement of the ACM Judgment if the Courtesy Standstill Period is terminated.

On May 26, 2026, the Company entered the Confession of Judgement and withdrew all its ongoing appeals against ACM. By entering into the Confession of Judgement and withdrawing all pending appeals, the Company has forfeited its right to contest the validity of the original $6,009,832.72 judgment. ACM has also been provided a roadmap of all Company assets and bank accounts to perfect its judgment and place liens. If the Company defaults or if the Courtesy standstill is terminated, ACM can immediately move to execute the judgment, freeze bank accounts, and seize assets.

Any such enforcement actions could have a material adverse effect on the Company’s liquidity, operations, and ability to consummate this Offering or the contemplated Approved Uplisting.

In addition to the risks of the enforcement, the diversion of capital and impending $3.5 million equity conversion under the ACM Letter Agreement may severely deter future institutional investors from participating in subsequent funding rounds. This potential chilling effect on future capital raises could critically impair the Company’s liquidity and long-term operational viability. Any such enforcement actions could have a material adverse effect on the Company’s liquidity, operations, and ability to consummate this Offering or the contemplated Approved Uplisting.

However, there can be no assurance that the Company will be successful in its appeal or in resolving these claims in its entirety, and such efforts may be time-consuming, costly and may have reputational and other negative effects on Zoomcar.

Our entering into a settlement with ACM could result in a breach of standstill provisions in agreements we entered into in connection with the investors in the November Offering

We have in the past and may continue in the future to negotiate a settlement of a claim against us by ACM, the terms of which could breach certain restrictive covenants in the securities purchase agreements we entered into with investors, and the Placement Agent Agreement we entered into with the Placement Agent, each in connection with the November Offering. These restrictive covenants prohibit us, subject to certain exceptions, from issuing additional shares of Common Stock or securities convertible into or exercisable for shares of Common Stock (“Common Stock Equivalents”), and from filing any registration statements to register for resale any of such securities, without the consent of the investors, who were issued 50.1% of the securities issued in the November Offering, and the Placement Agent. Since we expect to issue shares of Common Stock and Common Stock Equivalents to ACM, in connection with any settlement, and to register such shares of Common Stock and shares of Common Stock underlying Common Stock Equivalents for resale in one or more registration statements, such actions could result in a breach of these restrictive covenants and we could be liable for damages to the investors in the November Offering, and the Placement Agent, which could have a material adverse effect on our financial situation and operations.

If the pre-programmed IoT devices distributed to our Hosts to affix to registered cars, which IoT devices enable GPS tracking and data collection by Zoomcar and keyless, digital access to booked vehicles by Guests, do not function as they are intended to function, our business, financial condition, and results of operations could be adversely affected.

As part of our vehicle registration process, all Hosts are provided with an option to install a variety of customized software-enabled IoT devices These devices, which Zoomcar obtains from several suppliers and then programs prior to distribution to Hosts, serve multiple functions, including enabling Guests to access Host vehicles by digitized keyless access and start and end bookings using Zoomcar’s mobile app. The IoT devices also facilitate GPS monitoring by Zoomcar of in-trip vehicles, which serves a data collection function that is important to Zoomcar.

We have no control over the quality or functionality of the IoT devices distributed to Hosts and such devices may not function as intended or may be out of service during the course of a booking or while a Guest is attempting to access a booked vehicle. In such scenarios, Guests are able to contact Hosts via number masking call or text chat enabled by Zoomcar Guest App. However, failures to provide the seamless keyless functions may deny or delay Guests’ quick access to the vehicles, thus reducing Guests’ interest in utilizing our platform. Hosts, in turn, may rely on Zoomcar’s customer support functionality to facilitate connecting Guests to emergency services in the event of a vehicle accident or other situation that, if unresolved, could result in damage to a Host vehicle. If Zoomcar is unable to help Guests that encounter problems during bookings, it could result in complaints and negative reviews from both Hosts and Guests, and higher incidents of damages claims to Zoomcar by Hosts, leading to adverse consequences to our reputation, brand, business, prospects, and operating results.

We do not have long term contracts with the third-party suppliers of the IoT devices distributed to our Hosts and such suppliers can reduce quantities or terminate their sales of IoT devices to us at any time. Any adverse changes in such supply or the costs of such products or services may adversely affect our operations.

We collaborate with third-party suppliers who regularly provide products and services, including but not limited to IoT devices and software integrations, to us. We do not have long term purchase agreements in place with our current suppliers of the IoT devices that we program and advise our Hosts to install in the vehicles that they register to our platform and our suppliers could reduce the quantity of or discontinue providing IoT devices suitable for our needs. We do not have long term purchase agreements in place with our current suppliers of the IoT devices that we program and require our Hosts to affix to vehicles that they register to our platform and our suppliers could reduce the quantity of or discontinue providing IoT devices suitable for our needs. Given that the Hosts now have an option to install/not install these devices, we do not currently anticipate material challenges to identifying replacement suppliers if shortages of IoT devices occur, we are reliant on third parties to provide such devices and unanticipated shortages or an inability to identify new suppliers if our existing suppliers cease to be willing or able to provide the IoT devices on terms and at costs acceptable to Zoomcar may occur. Any such shortages, reductions or terminations in IoT device supply arrangements may have indirectly lead up to an adverse impact on our revenues, profits and financial condition. Any such shortages, reductions or terminations in IoT device supply arrangements may have an adverse impact on our revenues, profits and financial condition. Additionally, if the market prices for IoT devices that are suitable for our needs goes up, we may need to purchase the devices at a comparatively higher price, which may adversely affect our business, financial condition and results of operations.

We have limited control over the operations of our suppliers and other business partners and any significant interruption in their operations may have an adverse impact on our operations. For example, a significant interruption in the operations of our supplier’s production facilities could cause delay or termination of shipment of the IoT devices to us, which may, in turn, reduce or delay our ability to pre-program and distribute such devices to Hosts which may in turn affect the retention of Hosts who are more inclined towards installing the devices leading to a lower availability of inventory on our Platform.

As our operations continue to scale and grow, we anticipate needing an increased number of IoT devices, and our demand therefore may exceed the capabilities of our existing suppliers. If our suppliers cease to supply adequate numbers of IoT devices to us, or if we need alternative sources of supply for any other reason, those devices may not be immediately available to us. If alternative suppliers are not immediately available, we will have to identify and qualify alternative suppliers, and the installation of such devices on vehicles which Hosts wish to add to our platform may be delayed. We may not be able to find adequate alternative or additional suppliers in a reasonable period of time or on commercially acceptable terms, if at all. An inability to obtain sufficient supply of IoT devices which we can program for platform use may delay installation of such devices on vehicles that would otherwise become registered or more promptly registered to our platform, harm our relationships with Hosts, which could adversely affect our business and operations.

Maintaining and enhancing our brand and reputation is critical to our business prospects. While we have taken significant steps to build and improve our brand and reputation, failure to maintain or enhance our brand and reputation will cause our business to suffer.

As our platform continues to scale and becomes increasingly interconnected, resulting in increased media coverage and public awareness of our brand, future damage to our brand and reputation could have an amplified effect on our platform offerings. Our brand and reputation may also be harmed by events outside of our control, including by perceptions of our business or our platform which are subjective in nature. For example, if Hosts misrepresent the features or safety of their vehicles in platform listings or otherwise provide diminished quality of vehicles, Guests may not have positive experiences with bookings and may not return to the platform for future transportation needs. If Guests, in turn, do not treat Host vehicles with care, engage in reckless driving or other malfeasance during booked trips or violate platform terms and conditions or use Host vehicles in the commission of crimes or illegal acts, their actions could cause Hosts to withdraw vehicles from our platform or pursue damages claims against Zoomcar. Events ranging from unanticipated litigation involving Zoomcar to trip cancellations by Guests may affect perceptions of our business by individual Hosts and Guests or of larger numbers of persons or groups of persons about our platform and the perceived benefits or risks to booking cars through our platform. Because our ratings and review system encourages and facilitates public sharing of Hosts’ and Guests’ experience with bookings and with our platform, platform users have a forum to express describe their individual, subjective experiences with Host vehicles, bookings and any other aspect of our business, which may not always be favorable. Although we monitor usage of our platform review and ratings systems, we cannot control behaviors of our customers and from time to time, platform features designed to encourage productive information sharing may lead to dissemination of information which is misleading, misrepresentative, false and which may be damaging to our reputation. Any of the foregoing, among other facts and circumstances, may result in unfavorable press coverage about Zoomcar and our reputation and, consequently, our business may be harmed.

The acceptance of our brand will depend partially on maintaining a good reputation, minimizing the number of safety incidents, continuing an improved culture and workplace practices, improving existing functions, feature and technologies, developing new functions, features and technologies of our platform, maintaining a high quality of customer service and ethical behavior and continuing our marketing and public relations efforts. Our brand promotion, reputation building, and media strategies involve and will continue to involve significant costs, yet may not be successful. We anticipate that other competitors and potential competitors will scale and expand their business, which will make maintaining and enhancing our reputation and brand increasingly more difficult and expensive. If we fail to successfully maintain our brand in the current or future competitive environment or if events occur in the future which negatively affect public perception of our Company, our brand and reputation would be further damaged, and our business may suffer.

The impact of adverse or changing economic conditions, including the resulting effects on consumer spending or mobility patterns, may adversely affect our business, financial condition, and results of operations.

Our business depends on the overall demand for vehicle bookings. Any significant weakening of the economy in our operating jurisdictions or of the global economy, including the current macroeconomic downturn, more limited availability of credit, economic uncertainty, inflation, financial turmoil affecting the banking system or financial markets, increased unemployment rates, restrictions and reduction in domestic or international travel, fluctuations in the price or availability of gasoline, and other adverse economic or market conditions may adversely impact our business and operating results. Global economic and political events or uncertainty may cause some of our current or potential Hosts and Guests to curtail their use of our platform. In addition, travel has been disproportionately impacted by a macroeconomic downturn. In response to such downturns, Hosts and Guests may not use or spend on our platform at rates we expect, thus further reducing demand for vehicle bookings. These adverse conditions, have in the past resulted, and could in the future result, in reductions in consumer spending, slower adoption of new technologies, and increased competition. We cannot predict the timing, strength, or duration of any economic slowdown, including the current macroeconomic downturn, or any subsequent recovery generally. In addition, increases in inflation may cause Guests to decrease travel or choose alternative or lower cost methods of transportation versus utilizing our platform. If the conditions in the general economy significantly deviate from present levels and continue to deteriorate as a result of any such macroeconomic downturns, our business, financial condition, and results of operations could be adversely affected.

Increases in, labor, energy, and other costs could adversely affect our operating results.

Factors such as inflation, increased labor and employee benefit costs, and increased technology upgrade and updated costs, as well as other inflationary pressure, may increase our operating costs. Many of the factors affecting such costs are beyond our control cause these increased costs may cause us to pass costs on to Hosts and Guests by increasing certain fees paid by them to us, which may cause booking volume to decline which would harm our business and operating results.

Our operations have grown substantially since our inception, and we expect that they will continue to do so, subject to our financial condition. If we are unable to effectively manage that growth, our financial performance and future prospects will be adversely affected.

Since our inception, we have experienced significant growth in the scale of our operations. This expansion increases the complexity of our business and places significant strains on our management, personnel, operations, systems, technical performance, financial resources, and internal financial control and reporting functions. We may not be able to manage growth effectively, which could damage our reputation, limit our growth, increase our costs, and negatively affect our results of operations. Our business is becoming increasingly complex, and this complexity and our rapid growth have demanded, and will continue to demand, substantial resources and attention from our management.

Further, to accommodate our expected growth, we must improve and maintain our platform, technology, systems, and network infrastructure. Failure to effectively upgrade our technology or network infrastructure to support the expected increased traffic on our platform could result in unanticipated system disruptions, slow response times, or poor experiences for Hosts and Guests. To manage the expected growth of our operations and to support financial reporting requirements, we will need to improve our transaction processing and reporting, operational and financial systems and reporting, procedures, and controls. These improvements will be particularly challenging to realize if we acquire new operations with different systems or if we continue to rely on manual financial reporting practices. Our current and planned personnel, systems, procedures, and controls may not be adequate to support our future operations. If we are unable to expand our operations, improve our financial reporting processes, and hire additional qualified personnel in an efficient manner, it could adversely affect our business, customer and investor satisfaction, compliance with regulations and laws, and cause our expenses to grow disproportionately relative to our revenue, and our financial performance and future prospects will be adversely affected.

Breaches and other types of security incidents of our networks or systems similar to the recent Cybersecurity Incident, or those of our third-party service providers, could negatively impact our business, our brand and reputation, our ability to retain existing Hosts and Guests and attract new Hosts and Guests, may cause us to incur significant liabilities and adversely affect our business, results of operations, financial condition, and future prospects.

In the regular course of our business, we collect, use, store, transmit, and process data and information about Hosts, Guests, employees, and others, some of which may be sensitive, personal, or confidential and make us an attractive target and potentially vulnerable to cyberattacks, computer viruses, electronic break-ins or similar disruptions. Recently on June 9, 2025, the Company identified a Cybersecurity Incident involving unauthorized access to its information systems. The Company became aware of the incident after certain employees received external communications from a threat actor alleging unauthorized access to Company data. Upon discovery, the Company promptly activated its incident response plan. Although based on its initial assessment the Company determined that an unauthorized third party accessed a limited dataset containing certain personal information of a subset of approximately 8.4 million users, including names, phone numbers, car registration numbers, personal addresses and email addresses associated with such users, it found no evidence to suggest that financial information, plaintext passwords, or other sensitive identifiers were compromised. To date, the incident has not resulted in any material disruption to the Company’s operations.

Accordingly, any such unauthorized access to or use of such data and information, or breach of our security measures or those of our third-party service providers, could adversely affect our business, operations, and future prospects. While we have taken steps to mitigate our cyberattack risks and protect the confidential information that we have access to, including but not limited to installation and periodical updates of antivirus software and backup of information on our computer systems, our security measures may be vulnerable to such security breaches. In response to the Cybersecurity Incident, the Company took immediate actions to contain the threat and enhance its security posture. These measures include implementing additional safeguards across the cloud and internal network, increasing system monitoring, and reviewing access controls The Company had notified the appropriate regulatory and law enforcement authorities. These measures include implementing additional safeguards across the cloud and internal network, increasing system monitoring, and reviewing access controls. The Company had also engaged third-party cybersecurity experts to perform an external cybersecurity assessment of its systems and processes, and the identified vulnerabilities and weaknesses have been remediated

Even though the Company has taken the relevant steps to ensure that such breach does not occur again, because techniques used to sabotage or obtain unauthorized access to systems change frequently and generally are not recognized until they are launched against a target, we may be unable to anticipate these techniques or to implement adequate preventative measures. Any cybersecurity incident like the one we recently experienced, accidental or willful security breaches or other unauthorized access to our systems could cause confidential information to be stolen and used for criminal purposes. Cybersecurity incidents, security breaches or unauthorized access to confidential information could also expose us to liability related to the loss of the information, time-consuming and expensive litigation and negative publicity. If security measures are breached because of third-party action, employee error, malfeasance or otherwise, or if design flaws in our technology infrastructure are exposed and exploited, our relationships with our Hosts and Guests could be severely damaged, we could incur significant liability, and our business and operations could be adversely affected. Additionally, if we fail to protect confidential information, we may be susceptible to potential claims such as breach of contract, negligence or other claims. Such claims will require significant time and resources to defend and there can be no assurances that favorable final outcomes will be obtained.

An increasing number of organizations, including large online and offline merchants and businesses, other large Internet companies, financial institutions, and government institutions have disclosed breaches of their information security systems and other information security incidents, some of which have involved sophisticated and highly targeted attacks. In addition, users on our platform could have vulnerabilities on their own mobile devices that are entirely unrelated to our systems and platform, but which could mistakenly be attributed to us and our system and platform. Further, breaches experienced by other companies may also be leveraged against us. For example, credential stuffing and ransomware attacks are becoming increasingly common, and sophisticated actors can mask their attacks, making them increasingly difficult to identify and prevent. Certain efforts may be state-sponsored or supported by significant financial and technological resources, making them even more difficult to detect. If a third party or employee circumvents any of our security measures or those of our third-party service providers, they may access, misappropriate, delete, alter, publish, or modify this information, which could cause interruptions in our business and operations, fraud or loss to third parties, regulatory enforcement actions, litigation, indemnity obligations, competitive harm, and other possible liabilities, as well as negative publicity. Widespread negative publicity may also result from real, threatened, or perceived security compromises (or lack of adequate security measures) of our industry, competitors, Hosts, and Guests. Concerns regarding privacy and data security could cause some Hosts and Guests to stop using our services, and for employees to be less satisfied with their employment with us and potentially leave the Company or institute claims against us. This discontinuance in use and the potential failure to acquire new Hosts and Guests, and similar personnel issues, could substantially harm our business, results of operations, financial condition, and future prospects.

Our information technology systems, internal computer systems, cloud-based computing services, and those of our current and any future third-party service providers are vulnerable to interruption and intrusion. Cyberattacks and other malicious internet-based activity, such as insider threats, computer malware, hacking, and phishing attempts continue to increase. Any cybersecurity incident or material disruption or slowdown of our systems could cause outages or delays in our services, which could harm our brand and adversely affect our operating results. Our failure to implement adequate cybersecurity protections could subject us to claims for any breach of security, particularly if it results in disclosure of information relating to our Hosts or Guests. If changes in technology cause our systems to become obsolete, or if our systems are inadequate to facilitate our growth, we could lose Hosts or Guests, and our business and operating results could be adversely affected. From time to time, and most recently in 2025, we have experienced security incidents or attempted attacks, and in some instances, individuals have had their personal information compromised. We conduct investigations when we become aware of such incidents and/or attempted attacks (although our investigations may not be able to determine the method of attack) and may notify affected persons, as necessary. In addition to traditional computer “hackers” employing malicious code (such as viruses, worms, and ransomware) to breach our systems and platform, we are susceptible to and monitor for social engineering, cyber extortion, and personnel theft or misuse.

We may also be the subject of denial of service attacks, server malfunction, software or hardware failures, loss of data or other computer assets, adware, or other similar issues. Threat actors, nation states, and nation state-supported actors engage in cyberattacks, including for geopolitical reasons, continued opportunistic monetary reasons, and in connection with military conflicts and operations. During times of war and other major conflicts, we and our third-party service providers may be vulnerable to these attacks, including cyberattacks that could materially disrupt our systems, platform and operations. While we have security measures in place to protect customer information and prevent data loss, service interruption, and other security breaches, we cannot guarantee that our security measures or our third-party service providers’ security measures will be sufficient to protect against unauthorized access to, or other compromise of, personal information, confidential information, or proprietary information or of disruptions or damage to our systems. The techniques used to sabotage or to obtain unauthorized access to our platform, systems, networks, and/or physical facilities in which data is stored or through which data is transmitted change frequently, and we may be unable to anticipate such techniques or implement adequate preventative measures or stop security breaches that may arise from such techniques. As a result, our safeguards and preventive measures may not be adequate to prevent current or future cyberattacks and security incidents, including security breaches that may remain undetected for extended periods of time, which can substantially increase the potential for a material and adverse impact resulting from the breach.

We are required to comply with laws, rules, industry standards, and regulations that require us to maintain the security of personal information in India. We may also have contractual and other legal obligations to notify relevant stakeholders of security breaches. Failure to prevent or mitigate cyberattacks could result and has in the past resulted in unauthorized access to such data, including personal information. India has enacted laws requiring companies to notify individuals, regulatory authorities, and others of security breaches involving certain types of data. In addition, our agreements with certain partners may require us to notify them in the event of a security breach. Such disclosures are and could be costly, could lead to negative publicity, may cause Hosts and Guests to lose confidence in the effectiveness of our security measures and to not use our services, and may require us to expend significant capital and other resources to respond to and/or alleviate problems caused by the actual or perceived security breach. In addition, the costs to respond to a cybersecurity event or to mitigate any identified security vulnerabilities could be significant, including costs for remediating the effects of such an event, paying a ransom, restoring data from backups, and conducting data analysis to determine what data may have been affected by the breach. In addition, our efforts to contain or remediate a security breach or any system vulnerability may be unsuccessful, and our efforts and any related failures to contain or remediate any breach or vulnerabilities could result in interruptions, delays, loss in customer trust, harm to our reputation, and increases in our insurance premiums.

We do not currently have insurance coverage for security incidents or breaches, including fines, judgments, settlements, penalties, costs, attorney fees, and other impacts that arise out of incidents or breaches. While we may obtain cyber liability insurance in the future, we cannot assure you that such insurance coverage will adequately cover liabilities actually incurred or that insurance will continue to be available to us on economically reasonable terms, or at all. The successful assertion against us of one or more large claims that exceeds available insurance coverage, or that results in changes to insurance policies (including premium increases or the imposition of large deductible or co-insurance requirements), could have an adverse effect on our business. Our risks are likely to increase as we continue to expand, grow our Host and Guest base, and process, store, and transmit increasingly large amounts of confidential, proprietary and sensitive data. See Part I, Item 1C – Cybersecurity – for a more detailed discussion of our procedures relating to cybersecurity.

We face competition and could lose market share to competitors, which could adversely affect our business, financial condition and operating results.

We face and expect to continue to face competition from ride sharing companies, car rental and taxi companies. The car sharing market in particular is intensely competitive and is characterized by rapid changes in technology, shifting guest needs and preferences, and frequent introductions of new services and offerings. We expect competition to increase, both from existing competitors and new entrants in the markets in which we operate or plan to operate, and such competitors may be well-established and enjoy greater resources or other strategic advantages. If Zoomcar is unable to anticipate or successfully react to these competitive challenges in a timely manner, Zoomcar’s competitive position could weaken, or fail to improve, and Zoomcar could experience a decline in revenue or growth stagnation that could adversely affect Zoomcar’s business, financial condition and operating results.

Certain of our current and potential competitors may have greater financial, technical, marketing, research and development skills and other resources, greater name recognition, longer operating histories or a larger global user base than we do. Such competitors may be able to devote greater resources to the development, promotion and sale of offerings, and they may be able to offer lower prices in certain markets than we do, which could adversely affect our business, financial condition and operating results. These and other factors may allow our competitors to derive greater revenue and profits from their existing user bases, attract and retain Hosts and Guests at lower costs or respond more quickly to new and emerging technologies and trends. Current and potential competitors may also establish cooperative or strategic relationships, or consolidate, amongst themselves or with third parties, which may further enhance their resources and offerings relative to ours.

We believe that our ability to compete effectively depends upon many factors both within and beyond our control, including but not limited to:

If we are unable to compete successfully, our business, financial condition and operating results could be adversely affected.

We rely on mobile operating systems and application marketplaces to make its platform available to Hosts and Guests, and failure to effectively operate with or receive favorable placements within such application marketplaces could adversely affect Zoomcar’s business, financial condition and operating results.

We depend in part on mobile operating systems, such as Android and iOS, and their respective app marketplaces, to make our app available to Hosts and Guests. Any changes in such systems and app marketplaces that degrade the functionality or popularity of our app could adversely affect our platform’s usage on mobile devices and may adversely affect our user ratings and reviews in app marketplaces. If such mobile operating systems or app marketplaces limit or prohibit us from making our app available to Hosts and Guests, or if such systems or marketplaces make changes that degrade the functionality of our app, slow the rollout of our app on other app marketplaces, increase the cost of using our app, impose terms of use that are unsatisfactory to us, require users to opt in to enable marketing or advertising features, or modify their search or ratings algorithms in ways that are detrimental to us, our Guest growth may be negatively affected. Any of the foregoing risks could adversely affect our business, financial condition, and results of operations.

Our business depends on attracting and retaining capable management, technology development and operating personnel.

Our success depends in large part on our ability to attract and retain high-quality management, technology development and operating personnel. Competition for qualified employees is intense in our industry. There can be no assurance that members of our management team will continue to work for Zoomcar, or that we will be able to continue to attract or retain employees focused on technology development or other important aspects of our business and operations. Our employees, including members of our management team, could leave our Company with little or no prior notice and would be free to work for a competitor. The loss of even a few qualified employees, or an inability to attract, retain, and motivate additional highly skilled employees required to carry out our business plans, could harm our operating results and impair our ability to grow. If we were to lose key members of our management or technology teams, we would need to replace them with qualified individuals in a timely manner or else our business, results of operations and financial condition could be adversely impacted. Additionally, certain of our executive officers and directors may allocate their time to other businesses, thereby causing potential conflicts of interests which could have a negative impact on our business operations.

We also do not maintain “key person” life insurance on any of our employees. The departure of one or more of our senior management team members or other key employees could be disruptive to our business until we are able to hire qualified successors.

To attract and retain key personnel, we use various measures, including an equity incentive program for key executive officers and other employees. These measures may not be enough to attract and retain the personnel we require to operate and grow our business effectively. If we fail to identify, hire, train and retain the qualified management or technology personnel in the future, it may materially and adversely affect our business, financial condition, results of operations and prospects.

We are subject to payments-related risks.

We accept payments using a variety of methods, including credit or debit cards, or digital payment alternatives like UPI or other specific digital wallet platforms. As our payment policies are subject to change from time to time in accordance with evolving legal requirements and market availability of mobile and other payment systems in the jurisdiction where we operate, we offer new payment options to Hosts and Guests from time to time, subject to additional regulations, compliance requirements, and fraud risks. As our payment policies are subject to change from time to time in accordance with evolving legal requirements and market availability of mobile and other payment systems in different jurisdictions where we operate, we offer new payment options to Hosts and Guests from time to time, subject to additional regulations, compliance requirements, and fraud risks. For certain payment methods, including credit and debit cards, we pay interchange and other fees that may increase over time and raise our operating costs and lower profitability.

We rely on third-party payment processors to process payments, refunds, and reimbursements. Under our commercial agreements with these third parties, they may terminate the relationships with us at any time in their sole discretions. If one of these third parties terminates its relationship with us, or refuses to renew its agreement with us on commercially reasonable terms, we could incur substantial delays and expenses in locating and integrating an alternative payment service provider to process payments from Hosts and Guests, and the quality and reliability of any such alternative payment service provider may not be comparable. Further, the software and services provided by these third parties may not meet our expectations, may contain errors or vulnerabilities, and could be compromised or experience outages. Additionally, payment processing software is complex and involves automated processes implemented by us and the third parties that we engage. Therefore, the payment processing software can be misinterpreted and may be susceptible to errors. These risks could cause us, to lose our ability to accept and account for online payment or other payment transactions, make timely payments to Hosts, or result in over- or underpayments to Hosts, any of which could disrupt our business for an extended period of time, make our platform less convenient and attractive to users, expose user information to unauthorized disclosures and abuse, and adversely affect our ability to attract and retain Hosts and Guests, or materially adversely affect our business, financial condition, ability to forecast accurately, and results of operations.

If we are unable to maintain our chargeback or refund rates at levels that credit or debit card issuers, or payment processors deem acceptable, these entities may increase fees for chargeback transactions or for many or all categories of transactions; they may also increase the rates of declining transactions or terminate their relationships with us. Any increases in fees could adversely affect our operating results, particularly if we elect not to raise the prices for transactions on our platform to offset the increase. The termination of our ability to process payments on any major credit or debit cards or through certain online payment service providers or payment processors could significantly impair our ability to operate our business.

We may also be subject to, or may voluntarily comply with, a number of other laws and regulations relating to money laundering, money transmission, international money transfers, privacy and information security, and electronic fund transfers. If we are found to be in violation of such applicable laws or regulations, we could be subject to civil and criminal penalties or forced to cease our payments processing services or otherwise make changes to our business practices.

Any major disruption or failure of our information technology systems, or our failure to successfully implement new technology effectively, could adversely affect our business and results of operations or the effectiveness of internal controls over financial reporting.

We rely on various information technology systems, owned by us and third parties, to manage our operations. Over the last several years, we have been and continue to implement modifications and upgrades to our systems, including making changes to legacy systems, replacing legacy systems with successor systems with new functionality, and acquiring new systems with new functionality. These activities subject us to inherent costs and risks associated with replacing and upgrading these systems, including impairment of our ability to fulfil trip bookings, maintain books and records, potential disruption of our internal control structure, substantial capital expenditures, additional administration and operating expenses, retention of sufficiently skilled personnel to implement and operate the new systems, demands on management time, and other risks and costs of delays or difficulties in transitioning to new or upgraded systems or of integrating new or upgraded systems into our current systems. Our system implementations may not result in productivity improvements at a level that outweighs the costs of implementation, or at all. In addition, the difficulties with implementing new or upgraded technology systems may cause disruptions in our business operations and may have an adverse effect on our business and operations if not anticipated and appropriately mitigated.

The successful operation of our business depends upon the performance and reliability of internet, mobile, and other infrastructures that are not under our control.

Our business depends on the efficient, uninterrupted and reliable operations of internet, mobile, and other infrastructures that are not under our control. We may operate in certain geographic areas with limited internet connectivity. Internet access and access to a mobile device are frequently provided by companies with significant market power, which could result in corporate action that degrades, disrupts, or increases the cost of users’ ability to access our platform. Failure to effectively upgrade our technology or internet infrastructure to support the expected increased utilization of our platform by larger numbers of Hosts and Guests could result in unanticipated system disruptions, slow response times, or poor experiences for Hosts and Guests. In addition, the internet infrastructure that we and users of our platform rely on in any particular geographic area may be unable to support the demands placed upon it. Any such failure in internet or mobile device or computer accessibility, even for a short period of time, could interfere with the speed and availability of our platform. In addition, we have no control over the costs of the services provided by national telecommunications operators. If mobile internet access fees or other charges to internet users increase, consumer traffic may decrease, which in turn may cause our revenue to significantly decrease. If our platform is unavailable when users attempt to access it, or if our platform does not load as quickly as users expect, Hosts and Guests may not return to our platform as often in the future, or at all, and may use our competitors’ products, services, or offerings more often. Although we have attempted to prepare for contingencies through redundancy measures and disaster recovery plans, such preparation may not be sufficient, and we do not carry business interruption insurance. Despite any precautions we may take, the occurrence of a natural disaster, such as an earthquake, flood or fire, or other unanticipated problems in the jurisdictions where we operate, including power outages, telecommunications delays or failures, break-ins to our systems or computer viruses, could result in delays or interruptions to our platform, our app and website, and loss of data and business interruption for us and our Hosts and Guests. Any of these events could damage our reputation, significantly disrupt our operations and subject us to liability, which could materially and adversely affect our business, financial condition and results of operations.

Our business operations may result in losses for which we are not insured.

Our current business model consists of a peer-to-peer car-sharing platform which facilitates sharing of vehicles between Hosts and Guests. In this context, we are a facilitator of vehicle bookings but disclaim legal responsibility for cars owned by Hosts and for actions by Hosts and Guests on our platform and during bookings. Our platform terms and conditions, inform Hosts and Guests that booking, sharing and using cars through the platform is undertaken at their own risk; the lease agreement entered into between Hosts and Guests prior to each booking that occurs in India also disclaims our responsibility for Host and Guest property and for other damages incurred in relation to bookings. We also include in our platform terms and conditions a limit on our overall liability equal to the greater of the booking value of each trip and $120. However, we cannot be certain of the extent to which such disclaimers and limitations would be upheld as legally enforceable in every jurisdiction or circumstance. We regularly receive communication from Hosts (and from time to time, Guests) asserting that we are responsible, and requesting reimbursement, for damages to vehicles, lost property and other losses. All of our Guests pay a “value added” trip protection fee as part of a booking, however, the amount available to us from Guest trip protection fees is not sufficient to offset the amounts requested to cover the cost of all damages claims, nor do we attempt to offset all such requests to cover vehicle damage. As a result, we often remain at a risk of residual claims that we may have to absorb in absence of a third-party insurance. For further information regarding the trip protection fees and related matters, please review information contained in this 10-K under the heading  Item 3 Legal Proceedings - Other Matters.

Further, we currently do not carry any insurance to protect against third-party damage claims tied to death, personal injury, or Guest or Host theft or other losses, or third-party property damage. Although Hosts may insure their own vehicles to varying extents and are required to do so by law , or opt for trip insurance covers offered by certain empaneled third party insurance providers in certain selective locations and for limited categories of vehicle damages, we do not carry out independent verification of Host insurance coverage, nor does Host vehicle insurance coverage, to the extent it exists, insulate us, in full or in part, from all types of damages claims or claims for third-party indemnification associated with damages. For example, we have in the past received, and expect to continue to receive, complaints from Hosts regarding damage to, or loss, theft, or impounding of, their vehicles and requests for damage reimbursement, and from Guests regarding quality or serviceability of the vehicles, other safety and security issues, and actual or perceived discrimination in connection with Hosts declining trips and requests for reimbursement of their trip fees, as well as actual or threatened legal action against us if no reimbursement or perceived incomplete reimbursement is made. We may therefore be subject to claims of significant liability based on any of the foregoing or based on other events or circumstances which occur during a booking or relate in some other manner to our platform or our business. We do not maintain balance sheet reserves to cover costs of defending, disputing, adjudicating, satisfying or settling any such claims if they are asserted against us and we may not be able to succeed in any such actions, should they materialize and be determined to result in liability to us. While are currently in the process of identifying adequate and feasible insurance coverage for our business, there can be no guarantee that we will be able to obtain or expand insurance coverage in the future, and even if we are able to obtain additional coverage, we may not carry sufficient insurance coverage to satisfy potential claims. While we intend to expand our insurance coverage in the future, there can be no guarantee that we will be able to obtain additional insurance coverage in the future, and even if we are able to obtain additional coverage, we may not carry sufficient insurance coverage to satisfy potential claims. As our business continues to grow, incidences of such claims may also increase and, unless we obtain insurance coverage for such matters, we may choose or be required to absorb larger parts of such uninsured claims to avoid becoming subject to legal proceedings that could be resolved against us, which could lead to business losses and adversely affect our business, financial conditions and results of operations. Should uninsured losses occur, they could adversely affect our business, results of operations and financial condition. Further, our being subject to claims of liability, we may be subject to negative publicity and incur additional expenses, which could harm our business, financial condition, and operating results.

If we do not adequately protect our intellectual property and our data, our business, results of operations, and financial condition could be materially adversely affected.

We rely on a combination of trademark, copyright, domain names, trade names and trade secret laws, international treaties, our terms of service, other contractual provisions, user policies, restrictions on disclosures, and confidentiality agreements with our employees and consultants to protect our intellectual property rights from infringement and misappropriation. We currently have 21 registered trademarks and 1 recent trademark application that has passed the formalities check and is now under further examination along with 3 trademarks at variance – refused, abandoned and opposed, 1 patent application published, 3 patent applications have been abandoned, and 1 patent application withdrawn in India; and 7 domain names.

There is no assurance that our pending or future trademark, patent, and copyright applications will be approved. Furthermore, effective intellectual property protection may not be available in every country in which we intend to operate our business and some of the platform features and other customization of software that is important to our operations is not protected by registered intellectual property rights. Furthermore, effective intellectual property protection may not be available in every country in which we operate or intend to operate our business and some of the platform features and other customization of software that is important to our operations is not protected by registered intellectual property rights. There can be no assurance that others will not offer technologies, functions, features, or concepts that are substantially similar to ours and compete with our business, or copy or otherwise obtain, disclose and/or use our brand, platform features, design elements, our search-and-ranking algorithms and machine-learning and artificial intelligence-enhanced tools and capabilities or other information that we consider proprietary without authorization. We may be unable to prevent third parties from seeking to register, acquire, or otherwise obtain trademarks, copyrights or domain names that are similar to, infringe upon or diminish the value of our trademarks, copyrights, and our other proprietary rights. Third parties may obtain or misappropriate certain of our data through website scraping, robots, or other means to launch copycat sites, aggregate our data for their internal use, or to feature or provide our data through their respective websites, and/or launch businesses monetizing this data. While we routinely employ technological and legal measures in an attempt to divert, halt, or mitigate such operations, we may not always be able to detect or halt the underlying activities as technologies used to accomplish these operations continue to rapidly evolve.

If the protection of our proprietary rights and data is inadequate to prevent unauthorized use or misappropriation by third parties, the value of our brand and other intangible assets may be diminished and our competitors may be able to more effectively mimic our technologies, offerings, or features or methods of operations. Even if we do detect violations or misappropriations and decide to enforce our rights, litigation that may be necessary to enforce our rights may not be pursued by us, as it may be time-consuming and expensive, and divert our management’s attention. Additionally, a court of a competent jurisdiction may determine that certain of our intellectual property rights are unenforceable. If we fail to protect our intellectual property and data in a cost-effective and meaningful manner, our competitive standing could be harmed; our Hosts, Guests, other consumers, and corporate and community partners could devalue the content of our platform; and our brand, reputation, business, results of operations, and financial condition could be materially adversely affected.

We have been, and may in the future be, subject to claims that we or others violated certain third-party intellectual property rights, which, even where meritless, can be costly to defend and could materially adversely affect our business, results of operations, and financial condition.