Public companies are required to disclose risks that can affect the business and impact the stock. These disclosures are known as “Risk Factors”. Companies disclose these risks in their yearly (Form 10-K), quarterly earnings (Form 10-Q), or “foreign private issuer” reports (Form 20-F). Risk factors show the challenges a company faces. Investors can consider the worst-case scenarios before making an investment. TipRanks’ Risk Analysis categorizes risks based on proprietary classification algorithms and machine learning.

Tupperware Brands disclosed 28 risk factors in its most recent earnings report. Tupperware Brands reported the most risks in the “Finance & Corporate” category.

Risk Overview Q3, 2023

Risk Distribution

32% Finance & Corporate

21% Ability to Sell

14% Legal & Regulatory

14% Macro & Political

11% Production

7% Tech & Innovation

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

This chart displays the stock's most recent risk distribution according to category. TipRanks has identified 6 major categories: Finance & corporate, legal & regulatory, macro & political, production, tech & innovation, and ability to sell.

Risk Change Over Time

2020

S&P500 Average

Sector Average

Risks removed

Risks added

Risks changed

Tupperware Brands Risk Factors

New Risk (0)

Risk Changed (0)

Risk Removed (0)

No changes from previous report

The chart shows the number of risks a company has disclosed. You can compare this to the sector average or S&P 500 average.

The quarters shown in the chart are according to the calendar year (January to December). Businesses set their own financial calendar, known as a fiscal year. For example, Walmart ends their financial year at the end of January to accommodate the holiday season.

Risk Highlights Q3, 2023

Main Risk Category

Finance & Corporate

With 9 Risks

Finance & Corporate

With 9 Risks

Number of Disclosed Risks

No changes from last report

S&P 500 Average: 31

No changes from last report

S&P 500 Average: 31

Recent Changes

0Risks added

0Risks removed

4Risks changed

Since Sep 2023

0Risks added

0Risks removed

4Risks changed

Since Sep 2023

Number of Risk Changed

No changes from last report

S&P 500 Average: 3

No changes from last report

S&P 500 Average: 3

See the risk highlights of Tupperware Brands in the last period.

Risk Word Cloud

The most common phrases about risk factors from the most recent report. Larger texts indicate more widely used phrases.

Risk Factors Full Breakdown - Total Risks 28

Finance & Corporate

Total Risks: 9/28 (32%)Below Sector Average

Share Price & Shareholder Rights5 | 17.9%

Share Price & Shareholder Rights - Risk 1

Changed

The New York Stock Exchange may delist the Company's common stock from quotation on its exchange, which could limit investors' ability to sell and purchase the Company's securities and subject the Company to additional trading restrictions.

The Company has been and is currently out of compliance with the NYSE continued listing compliance standards. As a result, the Company is at risk of the NYSE delisting its common stock. If the Company's common stock is delisted from the NYSE, the Company could face material adverse consequences, including: - a limited availability of market quotations for the Company's securities;- reduced liquidity;- a determination that the Company's common stock is a "penny stock" which will require brokers trading in the Company's shares to adhere to more stringent rules, possibly resulting in a reduced level of trading activity in the secondary trading market for its common stock;- a limited amount of news and analyst coverage for the Company; and - a decreased ability to issue additional securities or obtain additional financing in the future. On June 1, 2023, the Company received written notification from the NYSE that the Company no longer satisfied the continued listing compliance standards set forth under Sections 802.01B and 802.01C of the NYSE Listed Company Manual because (i) its average global market capitalization over a consecutive 30 trading-day period was less than $50.0 million and, at the same time, its last reported stockholders' equity was less than $50.0 million and (ii) the average closing price of the Company's common stock was less than $1.00 over a consecutive 30 trading-day period. On August 1, 2023, the NYSE notified the Company that it had regained compliance with the minimum stock price standard of Section 802.01C of the NYSE Listed Company Manual. On February 1, 2024, the NYSE notified the Company that it had regained compliance with the minimum market capitalization and shareholders' equity requirement of Section 802.01B of the NYSE Listed Company Manual. On April 7, 2023, the Company received written notice from the NYSE indicating that the Company was not in compliance with Section 802.01E of the NYSE Manual, as a result of the Company's failure to timely file its 2022 10-K with the SEC. The Company has since filed the 2022 10-K on October 13, 2023. As a result of the Company's challenging financial condition and extensive efforts to complete the restatement of the historical Consolidated Financial Statements, the Company's Accounting department has experienced, and continues to experience significant attrition, including recent departures and expected departures in key control positions within the Accounting department and other supporting departments. The employee attrition has resulted in resource and skill set gaps, strained resources, and a loss of continuity of knowledge – all of which have contributed to delays in the filing of Forms 10-Q for the first, second, and third quarters of 2023, and are expected to contribute to delays in the filing the Annual Report on Form 10-K for fiscal year 2023. On September 20, 2023, the Company submitted a late filer extension request for an additional six-month cure period in which to file the quarterly reports on Forms 10-Q for the first, second, and third quarters of 2023. On October 3, 2023, the NYSE approved the Company's late filer extension requests granting the Company until March 31, 2024 to file its Forms 10-Q for the first, second and third quarters of 2023. The Company expects to regain compliance with Section 802.01E of the NYSE Manual with the filing of the Forms 10-Q. On October 27, 2023, the Company filed a Current Report on Form 8-K announcing that its independent auditor declined to stand for re-appointment as the Company's registered public accounting firm for the integrated audit of the fiscal year ending December 30, 2023. As a result, the Company disclosed that there would likely be further delays in the filing of the Company's Annual Report on Form 10-K for fiscal year 2023, given the time needed to evaluate and engage a new independent registered public accounting firm to serve as independent auditor for the fiscal year 2023. Failure to timely file the Company's Annual Report on Form 10-K for fiscal year 2023 would result in the Company no longer being in compliance with Section 802.01E of the NYSE Manual. On January 5, 2024, the Company received written notification from the NYSE that it was not in compliance with Section 302 of the NYSE Listed Company Manual due to the Company's failure to hold an annual meeting for the Company's fiscal year ended December 31, 2022 by December 31, 2023. The Company is working to regain compliance with Section 302 of the NYSE Listed Company Manual. A delisting of the Company's common stock from the NYSE could negatively impact the Company as it would likely reduce the liquidity and market price of the Company's common stock and thus (i) reduce the number of investors willing to hold or acquire the Company's common stock, which would negatively impact the Company's ability to access equity markets and obtain financing, and (ii) impair the Company's ability to provide equity incentives to its employees.

Share Price & Shareholder Rights - Risk 2

There is substantial doubt about the Company's ability to continue as a going concern, and this may adversely affect the Company's stock price, the Company's ability to raise capital, and the Company's relationship with its vendors.

Pursuant to ASC 205, Presentation of Financial Statements, the Company is required to and does evaluate at each annual and interim period whether there are conditions or events, considered in the aggregate, that raise substantial doubt about its ability to continue as a going concern for at least one year from the date of issuance of these Consolidated Financial Statements. Based on the definitions in the relevant accounting standards, the Company evaluated whether there are certain conditions and events, considered in the aggregate, that raise substantial doubt about the Company's ability to continue as a going concern. This evaluation includes considerations related to financial and other covenants contained in the Company's Credit Agreement as well as the Company's forecasted liquidity. In fiscal year 2022, the Company generated negative operating cash flow and, based on its current business plan, the Company expects to continue to spend substantial amounts in future periods, which may result in further periods of negative operating cash flow, further impacted by an increase in the number of vendors requiring more frequent payment or prepayment for goods and services. The Company had no ability to borrow further under its Revolver until August 2, 2023, when it entered into the Debt Restructuring Agreement, which enabled immediate access to up to $21.0 million on the Revolver subject to liquidity and other cash covenants as outlined in the Debt Restructuring Agreement. While the Company believes that the Debt Restructuring Agreement provides additional flexibility to fund its operations and satisfy its obligations as currently anticipated in the near term, it also imposes new covenants, including liquidity covenants which require the use of excess cash for debt reduction. Given the uncertainties around the Company's liquidity, ability to execute its Turnaround Plan, and ability to comply with financial and non-financial covenants, the Company has concluded that there is substantial doubt about its ability to continue as a going concern for at least one year from the date of issuance of these Consolidated Financial Statements. Refer to Note 16: Debt to the Consolidated Financial Statements in Item 8. Financial Statements and Supplementary Data of this Report for additional details around the Debt Restructuring Agreement. To address these covenant and liquidity concerns, the Company is taking the following actions: - engaged a financial advisor to assist in securing supplemental financing,- appointed a Chief Restructuring Officer,- appointed a new director to its Board of Directors with significant restructuring experience,- entered into the Debt Restructuring Agreement with its bank group,- engaging in discussions with potential investors or financing partners, with respect to potential financing transactions, such as issuing equity securities where dilution to stockholders is highly likely to occur,- reviewing its real property portfolio for potential monetization opportunities,- deferring certain growth capital spending with payback of more than a year, and - prioritizing re-engineering actions with short-term return. These actions are conditioned upon the receipt of offers and the execution of agreements with new or existing investors or the execution of sales agreements with third parties, which are considered outside of the Company's control. There is no assurance of the timing and outcome of these actions and as a result they are not considered probable of occurring until such time as they are completed. Unless the Company is able to successfully execute its Turnaround Plan, it will not be able to continue to operate its business pursuant to its current business plan. This would require management to modify its operations to reduce spending to a sustainable level by, among other things, delaying, scaling back or eliminating some or all of the Company's ongoing or planned investments in corporate infrastructure, business development, sales and marketing, research and development and other activities, which would have a material impact on the Company's operations, its ability to increase revenues, and the Company's relationship with its vendors. Alternatively, the Company may be forced to file for bankruptcy protection, which could include either reorganization or liquidation.

Share Price & Shareholder Rights - Risk 3

The Company's stock price has been and may continue to be subject to volatility.

The Company's stock price has experienced volatility over time and this volatility may continue. Stock volatility in itself may adversely affect shareholder confidence as well as employee morale and retention for those associates who receive equity grants as part of their compensation packages. The impact on employee morale and retention could adversely affect the Company's business performance and financial results. Stock volatility and other factors may also affect elements of the Company's capital allocation strategy, and its ability to use equity to fund acquisitions or raise capital. In addition, the Company has received, and may continue to receive, significant media attention, including from blogs, articles, message boards and social media. Information provided by third parties may not be reliable or accurate, or contain misleading, incomplete or otherwise damaging information, which could influence trading activity in the Company's stock. As a result, the Company's stock has experienced, and could continue to experience, extreme price and volume fluctuations that may be unrelated to its operating performance, financial position or other business fundamentals. This activity along with other factors, including the involvement of short sellers or activist investors in the Company's stock, has materially impacted in the past, and could materially impact in the future, the trading price of the Company's stock, put pressure on the supply and demand for its stock, limit the Company's shareholders from readily selling their shares and result in significant loss of investment.

Share Price & Shareholder Rights - Risk 4

The market prices and trading volume of our shares of common stock have recently experienced, and may continue to experience, extreme volatility, which could cause purchasers of our common stock to incur substantial losses.

The market prices and trading volume of the Company's shares of common stock have recently experienced, and may continue to experience, extreme volatility, which could cause purchasers of the Company's common stock to incur substantial losses. From December 30, 2022 to October 5, 2023, the market price of the Company's common stock has had extreme fluctuations, ranging from a closing day low of $0.62 per share on July 18, 2023, to a closing day high of $5.38 on August 1, 2023, and the last reported sale price of the Company's common stock on NYSE on October 5, 2023, was $1.26 per share. From December 30, 2022 to October 5, 2023, daily trading volume of the Company's common stock ranged from as low as 0.5 million shares to as high as 209.1 million shares. The Company believes that the recent volatility and the Company's current market prices reflect market and trading dynamics and macro or industry fundamentals, and the Company does not know how long these dynamics will last. Under the circumstances, the Company cautions investors against investing in the Company's common stock, unless investors are prepared to incur the risk of incurring substantial losses. Extreme fluctuations in the market price of the Company's common stock over the past year have been accompanied by reports of strong and atypical retail investor interest, including on social media and online forums. The market volatility and trading patterns the Company has experienced create several risks for investors, including the following: - the market price of the Company's common stock has experienced and may continue to experience rapid and substantial increases or decreases unrelated to the Company's operating performance, prospects, macro or industry fundamentals, and substantial increases may be significantly inconsistent with the risks and uncertainties that the Company continues to face;- factors in the public trading market for the Company's common stock include the sentiment of retail investors (including as may be expressed on financial trading and other social media sites and online forums), the direct access by retail investors to broadly available trading platforms, the amount and status of short interest in the Company's securities, access to margin debt, trading in options and other derivatives on the Company's common stock and any related hedging and other trading factors;- to the extent volatility in the Company's common stock is caused, as has widely been reported, by a "short squeeze" in which coordinated trading activity causes a spike in the market price of the Company's common stock as traders with a short position make market purchases to avoid or to mitigate potential losses, investors purchase at inflated prices unrelated to the Company's financial performance or prospects, and may thereafter suffer substantial losses as prices decline once the level of short-covering purchases has abated; and - if the market price of the Company's common stock declines, investors may be unable to resell their shares at or above the price at which investors acquired them. The value of newly issued shares of the Company's common stock may fluctuate or decline significantly in the future, in which case investors could incur substantial losses. The Company may continue to incur rapid and substantial increases or decreases in its stock price in the foreseeable future that may not coincide in timing with the disclosure of news or developments by or affecting the Company. Accordingly, the market price of the Company's shares of common stock may fluctuate dramatically and may decline rapidly, regardless of any developments in its business. See "-Risk Factor - A "short squeeze" due to a sudden increase in demand for shares of the Company's common stock that largely exceeds supply and/or focused investor trading in anticipation of a potential short squeeze have led to, may be currently leading to, and could again lead to, extreme price volatility in shares of the Company's common stock." Overall, there are various factors, many of which are beyond the Company's control, that could negatively affect the market price of the Company's common stock or result in fluctuations in the price or trading volume of its common stock, including: - actual or anticipated quarterly variations in operational results and reactions to earning releases or other presentations or reports issued by the Company;- failure to meet the expectations of securities analysts and investors;- rating agency credit rating actions;- the contents of published research reports about the Company or its industry or the failure of securities analysts to cover the Company's common stock;- any increased indebtedness the Company may incur in the future or the Company's inability to refinance any such indebtedness;- actions by institutional shareholders;- speculation or reports by the press or the investment community with respect to the Company or the Company's industry in general;- short interest in the Company's common stock and the market response to such short interest;- the dramatic increase in the number of individual holders of the Company's common stock and their participation in social media platforms targeted at speculative investing;- increases in market interest rates that may lead purchasers of the Company's shares to demand a higher yield;- changes in the Company's capital structure;- future sales of the Company's common stock by the Company, members of the Company's management or any significant shareholders;- announcements by the Company, its competitors or vendors of significant contracts, acquisitions, joint marketing relationships, joint ventures or capital commitments;- third-party claims or proceedings against the Company or adverse developments in pending proceedings;- additions or departures of key personnel;- changes in applicable laws and regulations;- negative publicity for the Company, its business or the Company's industry;- changes in expectations or estimates as to the Company's future financial performance or market valuations of competitors, customers or travel suppliers;- results of operations of the Company's competitors;- the Company's ability to manage supply chain-related expenses and disruptions in its supply chain;- the impact of the COVID-19 pandemic; and - general market, political and economic conditions, including any such conditions and local conditions in the markets in which the customers are located. In addition, in the past, shareholders have instituted securities class action litigation following periods of market volatility. If the Company is involved in additional securities litigation, the Company could incur substantial costs and the Company's resources and the attention of management could be diverted from the Company's business.

Share Price & Shareholder Rights - Risk 5

A "short squeeze" due to a sudden increase in demand for shares of the Company's common stock that largely exceeds supply and/or focused investor trading in anticipation of a potential short squeeze have led to, may be currently leading to, and could again lead to, extreme price volatility in shares of the Company's common stock.

Investors may purchase shares of the Company's common stock to hedge existing exposure or to speculate on the price of its common stock. Speculation on the price of the Company's common stock may involve long and short exposures. To the extent aggregate short exposure exceeds the number of shares of the Company's common stock available for purchase on the open market, investors with short exposure may have to pay a premium to repurchase shares of the Company's common stock for delivery to lenders of the Company's common stock. Those repurchases may, in turn, dramatically increase the price of shares of the Company's common stock until additional shares of the Company's common stock are available for trading or borrowing. This is often referred to as a "short squeeze." A large proportion of the Company's common stock has been in the past and may be traded in the future by short sellers, which may increase the likelihood that the Company's common stock will be the target of a short squeeze, and there is widespread speculation that the Company's recent volatility in trading price is the result of a short squeeze. A short squeeze and/or focused investor trading in anticipation of a short squeeze have led to, may be currently leading to, and could again lead to volatile price movements in shares of the Company's common stock that may be unrelated or disproportionate to its operating performance or prospects and, once investors purchase the shares of the Company's common stock necessary to cover their short positions, or if investors no longer believe a short squeeze is viable, the price of its common stock may rapidly decline. In addition, the Company does not record or have access to information regarding any share lending or short selling transactions other than what is publicly available from third-party providers. The Company does not have reliable information about synthetic shares and fake shares and only maintains records regarding shares that the Company has legally issued and are outstanding. The Company also understands that there has been considerable trading in derivatives on the Company's shares including both put and call options. These derivative securities can have the effect of increasing the volatility of the Company's share price. Investors that purchase shares of the Company's common stock during a short squeeze may lose a significant portion of their investment. Under the circumstances, the Company cautions investors against investing in the Company's common stock, unless investors are prepared to incur the risk of losing all or a substantial portion of their investment.

Accounting & Financial Operations2 | 7.1%

Accounting & Financial Operations - Risk 1

Management has identified material weaknesses in the Company's internal control over financial reporting, which could, if not remediated, result in additional material misstatements in the Company's interim or annual consolidated financial statements.

The Company's management is responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rule 13a-15(f) under the Exchange Act. Under the direction of the Company's Chief Executive Officer and Chief Financial Officer, management conducted an evaluation of the effectiveness of the Company's internal control over financial reporting. As a result of this evaluation, management identified material weaknesses in the Company's internal control over financial reporting. Because of these material weaknesses, management concluded that the Company did not maintain effective internal control over financial reporting as of December 31, 2022. Refer to Item 9A. Controls and Procedures of this Report for further information. As described in Management's Report on Internal Control Over Financial Reporting in Item 9A. Controls and Procedures of this Report, these material weaknesses resulted in the restatement of the Company's annual Consolidated Financial Statements in 2021 and 2020 and the 2022 and 2021 unaudited interim Condensed Consolidated Financial Statements. Accordingly, the Company has restated the accompanying 2021 and 2020 Consolidated Financial Statements in this Report. See Note 22: Restated Previously Issued 2021 and 2020 Financial Statements. The Company will effectuate restatement of the unaudited interim condensed consolidated financial information for the first three quarters of 2022 as part of filing of the 2023 interim Forms 10-Q. See Note 23: Quarterly Financial Summary (Unaudited) for additional information regarding the interim misstatements and resulting restatement impacts. Management intends to implement enhancements to its internal control over financial reporting, which are expected to include refinements and enhancements to the complement of personnel, design and operation of its controls related to the risk assessment process, income taxes, leases, intercompany loans, goodwill, account reconciliations, and the Consolidated Statements of Cash Flows. The Company intends to begin to implement these enhancements to the design of its controls during 2023 and to continue in 2024. However, these material weaknesses will not be considered remediated until management designs and implements effective controls that operate for a sufficient period of time and management has concluded, through testing, that these controls are effective. The Company will monitor the effectiveness of the remediation plan and will refine the remediation plan, as needed. Until remediated, the material weaknesses could result in future errors to the Company's financial statements. Remediation measures are time-consuming, require significant costs and place significant demands on the Company's financial and operational resources. In order to improve the effectiveness of its internal control over financial reporting, the Company has expended, and will need to continue to expend, significant resources, including accounting-related costs and significant management oversight. In view of the Company's liquidity position, employee turnover, and anticipated additional headcount reductions, the Company can give no assurance that the measures the Company takes will remediate the material weaknesses or that additional material weaknesses will not arise in the future. Additionally, the Company may not have sufficient resources to successfully execute its remediation plan. The Company is recruiting to fill vacancies in key areas resulting from recent resignations, including of its Chief Accounting Officer and Vice President of Internal Audit, but there can be no assurance that turnover in these positions will not cause delay in remediation efforts. Any failure to remediate the material weaknesses, or the development of new material weaknesses in the Company's internal control over financial reporting, could result in additional material misstatements in our financial statements and cause the Company to fail to meet its reporting and financial obligations, which in turn could have a negative impact on its reputation, brand and financial condition.

Accounting & Financial Operations - Risk 2

The Company has restated certain of its previously issued consolidated financial statements, which has resulted in unanticipated costs and may affect investor confidence and raise reputational issues.

As discussed in Note 1: Summary of Significant Accounting Policies and Note 22: Restated Previously Issued 2021 and 2020 Financial Statements to the Consolidated Financial Statements in Item 8. Financial Statements and Supplementary Data of this Report, the Company has restated its 2021 and 2020 annual Consolidated Financial Statements following the identification of misstatements. These newly identified misstatements are in addition to misstatements previously identified by the Company during 2022, as well as misstatements that were previously identified and disclosed in the Company's Annual Reports on Form 10-K as of and for the years ended December 25, 2021 and December 26, 2020 and in certain 2022 and 2021 Quarterly Reports on Form 10-Q. As a result of the misstatements and the restatements, the Company has become subject to additional risks, uncertainties and costs. The Company may become subject to enforcement proceedings brought by the SEC or other regulatory or governmental authorities, or subject to other legal proceedings, the misstatements or the related restatements, and actions and proceedings could also be brought against the Company's current and former employees, officers, or directors. These actions, lawsuits or other legal proceedings related to the misstatements or the restatements could result in reputational harm, additional defense and other costs, regardless of the outcome of the lawsuit or proceeding. If the Company does not prevail in any such lawsuit or proceeding, the Company could be subject to substantial damages or settlement costs, criminal and civil penalties and other remedial measures, including, but not limited to, injunctive relief, disgorgement, civil and criminal fines and penalties. In addition, the Company continues to be at risk for loss of investor confidence, loss of key employees, changes in management or the Company's Board of Directors and other reputational issues, all of which could have a material adverse effect on the Company's business, financial position and results of operation.

Debt & Financing1 | 3.6%

Debt & Financing - Risk 1

Changed

Current and future indebtedness could restrict the Company's operations, particularly its ability to respond to changes in its business or to take specified actions.

The Company is also dependent upon its Revolver Facility to fund its operations and satisfy obligations, and the Company must meet certain financial and non-financial covenants to be in compliance with the Credit Agreement and to have access to its Revolver Facility. On February 13, 2024, the Company entered into the Forbearance Agreement, pursuant to which the lenders party thereto agreed, during the Forbearance Period, to (a) forbear from exercising any of their respective rights and remedies arising under the Credit Agreement and applicable law as a result of the occurrence and continuance of certain specified existing and anticipated defaults and events of default under the Company's Credit Agreement and (b) permit the Company to continue to access its Revolver Facility on a limited basis, subject to certain terms and conditions, including liquidity and other cash covenants, notwithstanding the existence of such existing and anticipated defaults and events of default. There can be no assurance that the lenders party to the Credit Agreement will agree to any further forbearance after the expiration or termination of the Forbearance Period, and upon such expiration or termination, the lenders will have, among other things, the ability to demand repayment of outstanding borrowings, to restrict future borrowings under the Revolver Facility, and to exercise remedies against the collateral securing such borrowings. If such demand for repayment were to occur, the Company does not have the financial resources to repay such obligations. If the Company is unable to effectively execute its revised business plan, it may violate covenants in the future, and if the Company is unable to obtain further forbearance or other relief after the expiration or termination of the Forbearance Period, the lenders may accelerate outstanding debt obligations. Were the lenders to take action to accelerate the debt, the Company's liquidity, results of operations, and financial condition would be materially adversely impacted, and the Company may be forced to file for bankruptcy protection.

Corporate Activity and Growth1 | 3.6%

Corporate Activity and Growth - Risk 1

The Company may not fully realize the anticipated benefits of the Turnaround Plan and other operating or cost-saving initiatives, which may have a material adverse effect on the Company.

In 2020, the Company accelerated transformation initiatives, initiated in the years prior to 2020, and developed a Turnaround Plan. The multi-year implementation of the Turnaround Plan, which is still being operationalized, is expected to result in changes to business priorities and operations, capital allocation priorities, operational and organizational structure, and increased demands on management. Such changes could result in short-term costs, lost customers, reduced sales volume, higher than expected restructuring costs, further loss of key personnel, additional supply chain disruptions, higher costs of supply and other negative impacts on the Company's business. Implementation of the Turnaround Plan may take longer than anticipated, and, once implemented, the Company may not realize, in full or in part, the anticipated savings or benefits from one or more of the various restructuring and cost-savings programs undertaken as part of these efforts in full or in part or within the time periods expected. The Company's remediation efforts in response to the material weaknesses could further delay the implementation of the Turnaround Plan. It also may not realize the increase in sales intended to be enabled by the initiatives. The Company is also subject to the risks of labor unrest, negative publicity, and business disruption in connection with these initiatives. The failure to realize anticipated savings or benefits from such initiatives, which may be due to the Company's inability to execute plans, delays in the implementation of the Turnaround Plan, global or local economic conditions, competition and the other risks described herein, could have a material adverse effect on business, prospects, financial condition, liquidity, results of operations, and cash flows. The timing and investment in support of the Turnaround Plan could be constrained by the Company's liquidity. If the Turnaround Plan is not successful, the Company may be forced to file for bankruptcy protection, which could include either reorganization or liquidation.

Ability to Sell

Total Risks: 6/28 (21%)Above Sector Average

Demand2 | 7.1%

Demand - Risk 1

The Company's ability to improve its financial performance depends on its ability to anticipate and respond to market trends and changes in consumer preferences.

The Company's business is subject to changes in consumer trends and demands such as the types of products and materials the Company offers, the ease of finding and ordering the product, and the speed at which the products can be delivered. Consumer preferences and trends may change due to a variety of factors, such as changes in demographic trends, changes in the characteristics and materials used in its products, new market trends, or a weak economy in one or more of the markets in which the Company operates. The Company's ability to accurately predict and respond to these changes could impact the Company's financial results. If the Company is unable to anticipate changes in consumer preferences and trends, the Company's business, financial condition, and operating results could be materially adversely affected.

Demand - Risk 2

The Company's results of operations, liquidity, and cash flows could be materially harmed if the Company is unable to accurately forecast demand for its products, which could result in a shortage of products or increased inventory levels.

If the Company fails to accurately forecast customer demand it may experience excess inventory levels or a shortage of products to deliver to its customers, which could materially adversely impact the Company's results of operations, liquidity, and cash flows. The Company has experienced, and may continue to experience, challenges in supplying products to meet customer demands, has also experienced high inventory levels due to its supply of products not meeting projected demand, and might not be able to modify its internal systems, business practices, supply chain arrangements, and logistical support mechanisms quickly enough to meet these demands or decrease its production efficiently. If the Company is unsuccessful in forecasting the overall demand for its products, the Company's results of operations, liquidity, and cash flows could be materially adversely affected.

Sales & Marketing2 | 7.1%

Sales & Marketing - Risk 1

The Company is largely dependent upon the independent sales organizations and individuals to reach end consumers, and any significant disruption of this distribution network may materially adversely affect the Company's financial condition and operating results.

The Company's distribution system depends upon successful addition, activation, and retention of a large number of independent sales force members. A significant decline in the number of the Company's independent sales force members could lead to a decline in sales. The Company's active sales force declined 18 percent, 15 percent and 16 percent as of the end of the fourth quarter of 2022, the first quarter of 2023 and the second quarter of 2023, respectively, compared to the prior year. The addition, retention, and activation of sales force members is dependent upon the competitive environment among other companies who also use this channel of distribution and upon the general labor market, unemployment levels, general economic conditions, demographic and cultural changes in the workforce and the level of penetration of the Company's sales force in the geographies in which it operates, as well as the introduction of new products. In addition, if the sales force fails to find the Company's product development pipeline to be compelling, or if the Company fails to maintain public confidence in its competitive position due to the Company's disclosures regarding liquidity pressures, doubts regarding continuing as a going concern, or otherwise, the Company's ability to attract and retain sales force members may be adversely affected. The Company's sales are directly tied to the activity levels of its sales force, which is in large part a temporary working activity for many sales force members. Activity levels may be affected by the degree to which a market is penetrated by the presence of the Company's sales force, the amount of average sales per order, the amount of sales per sales force member, the mix of high-margin and low-margin products sold at group demonstrations and elsewhere, and the activities and actions of the Company's product line and channel competitors. The Company's sales force members may be affected by initiatives undertaken by the Company to grow its revenue base or change its cost base which may lead to the inaccurate perception that the independent sales force system is at risk of being phased out or that the Company intends to exit markets, as well as by external factors such as media coverage associated to the Company's liquidity position. Furthermore, due to the high level of competition in the Company's industry, it might fail to retain its independent sales force and their customers, which would harm the Company's financial condition and operating results. The Company is subject to significant competition for the recruitment of independent sales force from other direct selling businesses. Furthermore, the Company faces competition from newer business models that provide a stream of revenue opportunities which the sales force only has to accept (rather than identify on their own). The Company competes globally for potential customers and independent sales force, and if the Company is unable to successfully compete with other direct selling and related businesses, the Company's financial condition and operating results could be materially adversely affected.

Sales & Marketing - Risk 2

The Company relies on its sales force to adapt to changing consumer needs.

The Company currently has sales derived from channels other than direct selling. The reliance on this dominant channel in an environment where the consumer expects a frictionless experience could impact the Company's business. Furthermore, reliance on this dominant channel was impacted by the pandemic, and while the Company's sales force was able to utilize digital tools and social media to compensate for quarantine restrictions, this sales channel could be impacted further if other avenues for communicating with customers are unavailable.

Brand / Reputation2 | 7.1%

Brand / Reputation - Risk 1

The Company's success depends on its ability to maintain and enhance its brand protection, image and reputation.

The Company's iconic Tupperware brand has worldwide recognition, and the Company's continuing success, including the value of its collateral under the Credit Agreement, depends on its ability to maintain and enhance its brand protection, image, and reputation. Maintaining, promoting, and growing the Tupperware brand will depend on design and marketing efforts, sales force and consumer promotions and campaigns, product innovation, and product quality. If the Company is unable to obtain adequate capital resources, then management would have to, among other things, delay, scale back or eliminate some or all of these activities, which would have a material adverse effect on the Company's operations, brand protection, image and reputation. Furthermore, should there be events of default under the Credit Agreement, the administrative agent and the lenders party to the Credit Agreement have the current right to exercise remedies against the intellectual property and other collateral of the Company and its subsidiaries pledged as collateral security pursuant to the Credit Agreement, including the right to sell or otherwise dispose of such collateral security, which remedial exercises could also have a material adverse effect on the Company's operations, brand protection, image, and reputation.

Brand / Reputation - Risk 2

Information available in public media that is published by third parties, including blogs, articles, online forums, message boards and social and other media may include statements not attributable to the Company and may not be reliable or accurate.

The Company has received, and may continue to receive, a high degree of media coverage that is published or otherwise disseminated by third parties, including blogs, articles, online forums, message boards and social and other media. This includes coverage that is not attributable to statements made by the Company's directors, officers or employees. Investors should read carefully, evaluate and rely only on the information contained in or incorporated in the documents filed with the SEC in determining whether to purchase the Company's shares of common stock. Information provided by third parties may not be reliable or accurate and could materially impact the trading price of the Company's common stock which could cause losses to your investments.

Legal & Regulatory

Total Risks: 4/28 (14%)Below Sector Average

Regulation2 | 7.1%

Regulation - Risk 1

The Company could be adversely affected by violations of the U.S. Foreign Corrupt Practices Act or similar U.S. or foreign anti-bribery and anti-corruption laws and regulations in the jurisdictions in which it operates.

The Company operates in many different jurisdictions, including jurisdictions that are considered high-risk countries, and the Company could be adversely affected by violations of the United States Foreign Corrupt Practices Act ("FCPA") and similar worldwide anti-corruption laws. The FCPA and similar worldwide anti-corruption laws generally prohibit companies and their intermediaries from making improper payments for the purpose of obtaining or retaining business. The Company's internal policies mandate compliance with these anti-corruption laws. The Company operates in many parts of the world that have experienced corruption to some degree, and in certain circumstances, strict compliance with anti-corruption laws may conflict with local customs and practices. Despite the Company's training and compliance programs, the Company cannot assure you that its internal control policies and procedures always will protect the Company from reckless or criminal acts committed by Company's employees or agents. The Company's continued expansion outside the United States, including in developing countries, could increase the risk of such violations in the future. Violations of these laws, or allegations of such violations, could disrupt the Company's business and result in a material adverse effect on the Company's results of operations or financial condition.

Regulation - Risk 2

Evolving global regulations on direct selling companies could harm the Company's business and financial results.

The Company's business may also be affected by actions of domestic and foreign governments to restrict the activities of direct selling companies for various reasons, including a limitation on the ability of direct selling companies to operate without the involvement of a traditional retail channel. Foreign governments may also introduce other forms of protectionist legislation, such as limitations or requirements on where the products can or must be produced or requirements that non-domestic companies doing or seeking to do business place a certain percentage of ownership of legal entities in the hands of local nationals to protect the commercial interests of its citizens. Customs laws, tariffs, import duties, export and import quotas, and restrictions on repatriation of foreign earnings and/or other methods of accessing cash generated internationally, may negatively affect the Company's local or corporate operations. Governments may seek either to impose taxes on independent sales force members, to classify independent sales force members as employees of direct selling companies with whom they may be associated, triggering employment-related taxes on the Company's sales force and/or the direct selling companies, or to impose registration requirements that could impact prospects' willingness to join the sales force. Some governments prohibit or impose limitations on the requirement to purchase demonstration products upon joining a direct selling business and/or the types of activities for which sales force can be compensated. The United States government may impose restrictions on the Company's ability to engage in business in other countries in connection with the foreign policy of the United States.

Litigation & Legal Liabilities1 | 3.6%

Litigation & Legal Liabilities - Risk 1

Changed

The outcome of pending and future claims and litigation could have a material adverse impact on the Company's business, financial condition, and results of operations and damage the Company's reputation.

The Company is party to claims and litigation in the normal course of business. Furthermore, the Company may face material litigation outside the ordinary course of business that could materially adversely impact the Company's results of operations, financial condition, or cash flows. In June 2022, a putative stockholder class action was filed against the Company and certain current and former officers in the United States District Court for the Southern District of New York. The complaint alleged that statements made in public filings between November 3, 2021 and May 3, 2022 regarding the Company's earnings and sales performance and full year 2022 guidance violated Sections 10(b) and 20(a) of the Securities Act of 1934. The plaintiff sought to represent a class of stockholders who purchased the Company's shares during the alleged class period and demands unspecified monetary damages. On August 17, 2022, the Southern District of New York entered an order transferring the case to the Middle District of Florida. On September 16, 2022, the court appointed co-lead plaintiffs. On November 30, 2022, the plaintiffs filed a First Amended Class Action Complaint. The First Amended Class Action Complaint is based on alleged misstatements about the Company's profitability and pricing leading up to May 4, 2022; the plaintiffs also proposed a new class period of May 5, 2021 through May 4, 2022. On September 28, 2023, the Court denied the defendant's motion to dismiss the First Amended Class Action Complaint. On February 13, 2024, the plaintiffs filed a second amended complaint to add an additional named plaintiff. The plaintiffs did not change any of the other allegations. Defendants answered the second amended complaint on February 27, 2024. The Company is unable at this time to determine whether the outcome of this action would have a material impact on its results of operations, financial condition or cash flows. In August 2022, a stockholder derivative complaint was filed in the Ninth Judicial Circuit Court of Florida against certain of the Company's current and former officers and directors relating to the allegations in the securities class action referenced in the preceding paragraph. The derivative complaint asserts claims against the officers and directors for breach of fiduciary duty, unjust enrichment, and waste of corporate assets based on allegations that, among other things, the officers and directors allowed the Company to make false or misleading statements in violation of the securities laws. On July 28, 2023, the defendants filed a motion to dismiss. On September 21, 2023, the plaintiff filed an amended complaint. On October 23, 2023, the parties filed a joint motion to stay this action pending the conclusion of certain events in the putative stockholder class action described in the preceding paragraph. The stay was granted on October 25, 2023. The Company is unable at this time to determine whether the outcome of these actions would have a material impact on its results of operations, financial condition or cash flows. In March 2023, a putative stockholder class action was filed against the Company and certain current and former officers in the United States District Court for the Middle District of Florida. The complaint alleges that statements made in public filings between March 10, 2021 and March 16, 2023 regarding the Company's income taxes and internal controls violated Sections 10(b) and 20(a) of the Securities Act of 1934. On June 5, 2023, the District Court appointed a lead plaintiff, who filed an amended complaint on January 12, 2024. The amended complaint proposes a new class period of February 23, 2022 through March 16, 2023. On March 12, 2024, the Company filed a motion to dismiss the amended complaint. Plaintiff may file a response on or before May 13, 2024, and Defendants may reply on or before June 12, 2024. Plaintiff may file a response on or before May 13, 2024, and Defendants may reply on or before June 12, 2024. The Company is unable at this time to determine whether the outcome of this action would have a material impact on its results of operations, financial condition or cash flows. In January 2024, a stockholder derivative complaint was filed in the in United States District Court for the Middle District of Florida against certain of the Company's current and former officers and directors. The derivative complaint asserts claims against the officers and directors for breach of fiduciary duty, contribution for violations of the securities laws, unjust enrichment, and waste of corporate assets based on allegations that, among other things, the officers and directors allowed the Company to make false or misleading statements in violation for the securities laws during the period of November 3, 2021 through March 16, 2023. On March 8, 2024, Defendants filed a motion to stay this action pending the conclusion of certain events in the putative stockholder class action filed in June 2022. The Court granted the stay on March 11, 2024. The Company is unable at this time to determine whether the outcome of this action would have a material impact on its results of operations, financial condition or cash flows. Legal proceedings in general, and securities and class action litigation and regulatory investigations in particular, can be expensive and disruptive. The Company's insurance may not cover all claims that may be asserted against the Company, and the Company is unable to predict how long the legal proceedings to which the Company is currently subject will continue. An unfavorable outcome of any legal proceeding may have an adverse impact on the Company's business, financial condition and results of operations, or its stock price. Any proceeding could negatively impact the Company's reputation among its customers or its stockholders.

Environmental / Social1 | 3.6%

Environmental / Social - Risk 1

The Company is subject to environmental laws and regulations that expose the Company to a number of risks and could result in significant liabilities and costs.

The Company operates manufacturing facilities in the United States and around the world, and is subject to numerous environmental regulations with respect to the operation of those facilities. If the Company were to experience a material adverse environmental event at one of those facilities, or if the Company were to experience any material product safety issue or other significant issue with respect to its products or resins, the Company's results of operations and financial condition could be materially adversely affected. Furthermore, concern over plastics products may result in new or increased legal and regulatory requirements to reduce or mitigate impacts to the environment. Increased regulatory requirements, including in relation to various aspects of ESG including disclosure requirements, or environmental causes may result in increased compliance or input costs of raw materials, which may cause disruptions in the manufacture of the Company's products or an increase in operating costs. If the Company does not adapt to or comply with new regulations, or fails to meet evolving investor, industry, or stakeholder expectations and standards, or if the Company is perceived to have not responded appropriately to the growing concern for ESG issues, customers and consumers may choose to stop purchasing the Company's products or purchase products from another company or a competitor, and the Company's reputation, business, or financial condition may be adversely affected.

Macro & Political

Total Risks: 4/28 (14%)Above Sector Average

International Operations3 | 10.7%

International Operations - Risk 1

The Company is subject to financial risks as a result of its international operations, including exposure to foreign currency fluctuations, the impact of foreign currency restrictions, its ability to repatriate cash from jurisdictions outside of the United States, and the impact of international sanctions.

The Company is subject to risks of doing business internationally. The Company has derived, for a number of years, most of its net sales from operations outside the United States. As a result, the Company faces exposure to adverse movements in currency exchange rates as the financial results of its international operations are translated from local currency into U.S. Dollars. Upon translation, operating results may differ materially from expectations, and the Company may record significant gains or losses on the remeasurement of intercompany balances. Doing business in developing international markets exposes the Company to greater risks than companies of a similar size who focus on developed markets. Movement in exchange rates has had and may continue to have a significant impact on the Company's earnings, cash flows, and financial position. The Company's most significant exposures are to the Argentine Peso, Euro, Indonesian Rupiah, Japanese Yen, Mexican Peso, and Swiss Franc. Although the Company's currency risk is partially mitigated by the natural hedge arising from its local product sourcing in many markets, a strengthening U.S. Dollar generally has a negative impact on the Company. To mitigate such negative impact, the Company continues to implement foreign currency hedging and risk management strategies to reduce the exposure to fluctuations in earnings associated with changes in foreign currency exchange rates, however, as a result of substantial doubt about the Company's ability to continue as a going concern, the Company is currently limited in its ability to execute hedging transactions. The Company generally does not seek to hedge the impact of currency fluctuations on the translated value of the sales, profit, or cash flow generated by its operations. Some of the hedging strategies implemented have a positive or negative impact on cash flows as foreign currencies fluctuate versus the U.S. Dollar. In past periods the movement of foreign currency exchange rates has had a material effect on the Company's results of operations. There can be no assurance that the Company's hedging strategies will be successful and foreign currency fluctuations and related hedging activities may not have a material adverse impact on the Company's results of operations, cash flows, and/or financial condition. Furthermore, foreign governments have imposed restrictions on currency remittances, including, but not limited to, remittances from Argentina and Ukraine of $8.3 million and $4.9 million, respectively. Due to existing and potential future government restrictions on transfers of cash out of countries and control of exchange rates and currency convertibility, the Company may not be able to immediately access its cash at the exchange rate used to translate its financial statements. A substantial majority of the Company's cash is held outside of the United States, and if the Company experienced additional restrictions on its ability to move cash into the United States, the Company's liquidity position could be materially adversely affected. Due to the challenging internal and external business economics, coupled with the increased levels and cost of borrowings under its Credit Facility, the Company is facing liquidity constraints, which require repatriation of cash from international jurisdictions when available. As a result, the Company has determined that it can no longer assert permanent reinvestment on any of the outside basis differences of its foreign subsidiaries, as it will likely need to repatriate cash and assets globally to the United States to meet its debt obligations. In light of these new facts identified in the financial statement close process at the end of the most recent fiscal year, the Company has revisited its earlier position. The Company lifted all indefinite assertion positions for all of its foreign subsidiaries and has increased its deferred tax liability to $24.0 million in the fourth quarter of 2022 related to the estimated income tax, withholding tax costs and capital gain impacts associated with repatriation of these earnings. As this amount is estimated based on the current outside basis differences of the foreign subsidiaries, the actual withholding costs incurred for repatriation of cash may differ and result in additional tax costs. In addition, the United States government may impose material sanctions and restrictions on doing business with certain countries, businesses, and individuals, including, as an example, the sanctions against countries such as Russia or within specific regions of Ukraine. Such events could have a material adverse effect on the Company's business and financial performance, including through increased costs of compliance, reduced net sales as a result of restrictions on the Company's ability to sell into specific regions of the world, higher volatility in foreign currency exchange rates, and increased input costs (such as energy). The conflict in Ukraine could continue to impact business and financial performance in Europe and the Company's results of operations on a consolidated basis. Management continues to monitor the political and economic situation and has taken several measures, including cash repatriation, to proactively manage the risk. In addition, sanctions imposed on Russia could impact the fulfillment of existing orders, any future revenue streams from impacted customers, and the recoverability of certain financial assets. Management will continue to assess the Company's mitigation activities in light of the evolving situation and the related risks, but there can be no assurances that the conflict will not have a material adverse impact on the Company's results of operations, cash flows, and/or financial condition.

International Operations - Risk 2

Risks associated with the Company's international operations and sales and changes in economic environments, including inflation, rising interest rates, and/or a recession, could adversely affect the Company's business and earnings.

Changes in the economic environment or other governmental restrictions (including, but not limited to, inflation, rising interest rates, and/or a recession) in any of the countries where the Company operates could materially affect the Company's revenues and operating results. Although these operations are geographically dispersed, which partially mitigates the risks associated with operating in particular countries, the Company is subject to the usual risks associated with international operations. Among others, these risks include local political and economic environments, adverse new tax regulations, potentially burdensome privacy protocols, including the EU General Data Protection Regulation, and relations between the United States and foreign governments. In addition, the Company does business in developing countries, some of which have higher risk profiles, and some of the international jurisdictions in which the Company operates have a different, or less developed, legal system that lacks transparency in certain respects relative to that of the United States, and can accord local government authorities a higher degree of control and discretion over business than is customary in the United States.

International Operations - Risk 3

The Company's ability to conduct business in its international markets may be affected by political, legal, tax and regulatory risks.

The Company's global operations expose the Company to a number of additional risks, including: - changes in a specific country's or region's political, social, or economic conditions, particularly in emerging markets;- civil unrest, turmoil, or outbreak of disease or illness, such as the novel coronavirus, in any of the countries in which the Company sells its products or in which the Company or its suppliers operate;- tariffs, other trade protection measures, as discussed in more detail below, and import or export licensing requirements;- potential adverse changes in trade agreements between the United States and foreign countries;- potentially negative consequences from changes in United States and international tax laws;- difficulty in staffing and managing geographically widespread operations;- differing labor regulations;- requirements relating to withholding taxes on remittances and other payments by subsidiaries;- different regulatory regimes controlling the protection of the Company's intellectual property;- restrictions on its ability to own or operate subsidiaries, make investments or acquire new businesses in these jurisdictions;- restrictions on its ability to repatriate dividends from the Company's foreign subsidiaries;- difficulty in collecting international accounts receivable;- difficulty in enforcement of contractual obligations not within United States legal jurisdiction;- transportation delays or interruptions;- changes in regulatory requirements; and - the burden of complying with multiple and potentially conflicting laws, including, but not limited to, conflicting labor and employment laws. See Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations for further discussion regarding these risks.

Natural and Human Disruptions1 | 3.6%

Natural and Human Disruptions - Risk 1

The Company's financial results and ability to grow its business may be negatively impacted by global events beyond its control.

With operations in many states and multiple foreign countries, the Company is subject to numerous risks outside of its control, including risks arising from natural disasters, such as fires, earthquakes, hurricanes, floods, tornadoes, unusual weather conditions, pandemic outbreaks and other global health emergencies, terrorist acts or disruptive global political events, or similar disruptions that could materially adversely affect business and financial performance. Any public health emergencies, including a real or potential global pandemic such as those caused by the avian flu, SARS, Ebola, coronavirus, or even a particularly virulent flu, could decrease demand for the Company's products and ability to offer them through parties held by the sales force. The worldwide outbreak of the Coronavirus Disease 2019 ("COVID-19"), which was declared by the World Health Organization to be a "pandemic," has impacted worldwide economic activity. While COVID-19 and its variants continued into 2022, the impact from continued partial lockdowns was isolated primarily to China. Refer to Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations of this Report for further information. The Company continued to navigate the impacts of the global COVID-19 pandemic to ensure the safety of its employees and their families, sales force, and consumers, and to mitigate the impact of the pandemic on its operations and financial results. Uncharacteristic or significant weather conditions can affect travel and the ability of businesses to remain open, which could lead to decreased ability for sales force to connect with customers and materially adversely affect short-term results of operations. Although it is not possible to predict such events or their consequences, these events could materially adversely affect the Company's reputation, business and financial condition.

Production

Total Risks: 3/28 (11%)Below Sector Average

Manufacturing1 | 3.6%

Manufacturing - Risk 1

The Company's success depends, in part, on the quality and safety of its products.

Certain of the materials used in the Company's product lines may give rise to concerns of consumers based upon scientific theories which are espoused from time to time, including the risk of certain materials leaching out of plastic containers used for their intended purposes or the ingredients used in cosmetics, personal care, or nutritional products causing harm to human health. This includes polycarbonate, which contains the chemical Bisphenol A, and polyethersulfone, which contains the chemical Bisphenol S. It is the Company's policy to market products in each of its business units containing only those materials or ingredients that are approved by relevant regulatory authorities for contact with food or skin or for ingestion by consumers, as applicable. Product safety or quality failures, actual or perceived, or allegations of product contamination, even when false or unfounded, or inclusion of regulated ingredients could tarnish the image of the Company's brands and could cause consumers to choose other products. Allegations of contamination, allergens, or other adverse effects on product safety or suitability for use by a particular consumer, even if untrue, may require the Company from time to time to recall a product from all of the markets in which the affected production was distributed. Such issues or recalls and any related litigation could negatively affect the Company's profitability and brand image.

Employment / Personnel1 | 3.6%

Employment / Personnel - Risk 1

Changed

The Company's success is substantially dependent on the strength and continued service of its Board, senior management and other key employees, and its continued ability to attract and retain highly talented new team members with necessary skills to execute against the Company's key strategies.

The Company's success depends in part on the efforts and abilities of qualified Board members and personnel at all levels, including its senior management team and other key employees. Their motivation, skills, experience, contacts, and industry knowledge significantly benefit the Company's operations and administration. The failure to attract, motivate, and retain highly qualified members of the Board and senior management team could have an adverse effect on the Company's results of operations, cash flows, and financial condition. In 2023 the Company terminated Mr. Fernandez, President and Chief Executive Officer and Board member and Beatriz Díaz de la Fuente, Chief Human Resources Officer. The Company appointed a new President and Chief Executive Officer, Laurie Ann Goldman, and Chief Restructuring Officer, Brian Fox. Ms. Sheehan, Executive Vice President, Chief Legal Officer and Corporate Secretary resigned from her position effective September 30, 2023 and rejoined the Company effective November 20, 2023 after briefly serving as a consultant to the Company, and Ms. Otero, Senior Vice President and Chief Accounting Officer and Richard Goudis, Executive Vice Chair and Director, resigned effective October 13, 2023. Also in 2023, the Company's Vice President, Internal Audit, and its Vice President, Treasurer, resigned from their positions. On October 16, 2023, Mark Burgess, Meg Crofton, Deborah Ellinger, and James Fordyce elected to resign from the Board. Effective October 17, 2023, the Board appointed three new directors, Lori Bush, Paul Keglevic and William Transier. In addition, on January 10, 2024 the Company restructured the role of Chief Commercial Officer and exited Hector Lezama, Chief Commercial Officer on January 19, 2024. Samantha Lomow was subsequently appointed by the Company to the restructured Chief Commercial Officer role. Any significant leadership change or senior management transition involves inherent risk and any failure to ensure a smooth transition could hinder the Company's strategic planning, execution, and future performance. The Company's recent financial and operational difficulties could lead to the loss of additional senior executives. Further changes in the Board or senior management team may create additional uncertainty among investors, employees, and others concerning the Company's future direction and performance. Furthermore, the Company-initiated headcount reductions, coupled with employee turnover, have resulted in a loss of continuity of knowledge and has created resource constraints. Any disruption in the Company's operations or uncertainty could have an adverse effect on its business, financial condition, or results of operations.

Supply Chain1 | 3.6%

Supply Chain - Risk 1

The Company relies on third-party suppliers for raw materials and the loss of these suppliers, a supplier's inability to supply a raw material or a disruption or interruption in the supply chain may adversely affect the Company's business.

The supply and cost of raw materials, particularly petroleum and natural gas-based resins, may have an impact on the availability or cost of the Company's plastic products. The Company may experience a significant disruption in the supply of raw materials from current sources or, in the event of a disruption, the Company may be unable to locate alternative materials suppliers of comparable quality at an acceptable price, or at all. Moreover, the Company's suppliers may not be able to fill the Company's orders in a timely manner depending on market conditions or increased demand for product. The Company's lack of liquidity could also impair the Company's relationships with its third-party suppliers. In addition, if the Company loses or needs to replace an existing supplier as a result of adverse economic conditions or other reasons, additional supplies of raw materials or additional manufacturing capacity may not be available when required on terms that are acceptable to the Company, or at all, or suppliers or manufacturers may not be able to allocate sufficient capacity to the Company in order to meet the Company's requirements. Even if the Company is able to expand existing sources, the Company may encounter delays in production and added costs as a result of the time it takes to train its suppliers on its methods, products and quality control standards. Any delays, interruption or increased costs in the supply of raw materials could have an adverse effect on its ability to meet consumer demand for its products and result in lower net revenues and net income (or higher net loss) both in the short and long-term.

Tech & Innovation

Total Risks: 2/28 (7%)Below Sector Average

Trade Secrets1 | 3.6%

Trade Secrets - Risk 1

Failure to protect the Company's intellectual property rights, or the Company's conflict with the rights of others, could damage the Company's brand, weaken its competitive position and negatively impact its results of operations.

The Company's success depends in large part on its brand image. The Company currently relies on a combination of copyright, trademark, patent and unfair competition laws, confidentiality procedures, and licensing arrangements to establish and protect its intellectual property rights. The steps taken by the Company to protect its proprietary rights may not be adequate to prevent infringement of its trademarks and proprietary rights by others, including imitation of its products and misappropriation of its brand. In addition, intellectual property protection may be unavailable or limited in some jurisdictions. Preventing unauthorized use or infringement of the Company's intellectual property rights is inherently difficult. The Company's products are subject to frequent counterfeiting and other intellectual property infringement, which may be difficult to police and prevent, depending upon the ability to identify infringers and the availability and/or enforceability of intellectual property rights. Such counterfeit sales, to the extent they replace otherwise legitimate sales, could adversely affect the Company's operating results. If the Company is unable to protect its proprietary rights, the Company may be at a disadvantage to others who do not incur the substantial time and expense the Company incurs to create its products. Any of these events could harm the Company's business and have a material adverse effect on its results of operations and financial condition.

Cyber Security1 | 3.6%

Cyber Security - Risk 1

Security incidents and attacks on the Company's information technology systems could lead to significant costs and disruptions that could harm the Company's business, financial results, and reputation.

The Company relies extensively on information technology systems to conduct its business, some of which are managed by third-party service providers. These systems include, but are not limited to, programs and processes relating to internal communications and communications with other parties, ordering and managing materials from suppliers, converting materials to finished products, receiving orders and shipping product to customers, billing customers and receiving and applying payments, processing transactions, summarizing and reporting results of operations, complying with regulatory, legal or tax requirements, collecting and storing certain customer, employee, investor, and other stakeholder information and personal data, and other processes necessary to manage the Company's business. Current and increased information technology security threats, and current and more sophisticated computer crime, including advanced persistent threats, pose a risk to the security of the information technology systems, networks, and services of the Company, its customers and other business partners, as well as the confidentiality, availability, and integrity of the data of the Company, its customers and other business partners. Furthermore, the risk of a cybersecurity incident is heightened as more of the Company's employees work remotely. As a result, the Company's information technology systems, networks, or service providers could be damaged or cease to function properly or the Company could suffer a loss or disclosure of business, personal, or stakeholder information, due to any number of causes, including catastrophic events, power outages and security breaches. Although the Company has business continuity plans in place, if these plans do not provide effective alternative processes on a timely basis, the Company may suffer interruptions in its ability to manage or conduct its operations, which may adversely affect its business. The Company may need to expend additional resources in the future to continue to protect against, or to address problems caused by, any business interruptions or data security breaches. Any business interruptions or data security breaches, including cyber-security breaches resulting in private data disclosure, could result in lawsuits or regulatory proceedings, damage the Company's reputation or adversely impact the Company's results of operations, cash flows, and financial condition. While the Company maintains insurance coverage that could cover some of these types of issues, the coverage has limitations and includes deductibles such that it may not be adequate to offset losses incurred. The Company has experienced various security threats and incidents, including, for example, email compromise events, vulnerabilities, malware, phishing, and non-compliance with internal security requirements and procedures, that have not had a material impact on the Company; however, if the Company were to experience material threats or incidents in the future, there could be significant costs and disruptions that could harm the Company's business, financial results, and reputation. The Company could also be adversely affected by system or network disruptions if new or upgraded information technology systems or software are defective, not installed properly, or not properly integrated into its operations, as well as if the capacity and system limitations of the Company's information technology systems or software are exceeded due to the number of the Company's employees working from home due to flexible schedules and work-from-home arrangements. Various measures have been implemented to manage the risks related to the implementation and modification of hardware and software, but any significant disruption or deficiency in the design and implementation of new or upgraded information technology systems or software could have a material adverse effect on the Company's business, financial position, and results of operations and could, if not successfully implemented, adversely impact the effectiveness of internal control over financial reporting.

See a full breakdown of risk according to category and subcategory. The list starts with the category with the most risk. Click on subcategories to read relevant extracts from the most recent report.

FAQ

What are “Risk Factors”?

Risk factors are any situations or occurrences that could make investing in a company risky.

The Securities and Exchange Commission (SEC) requires that publicly traded companies disclose their most significant risk factors. This is so that potential investors can consider any risks before they make an investment.

They also offer companies protection, as a company can use risk factors as liability protection. This could happen if a company underperforms and investors take legal action as a result.

It is worth noting that smaller companies, that is those with a public float of under $75 million on the last business day, do not have to include risk factors in their 10-K and 10-Q forms, although some may choose to do so.

How do companies disclose their risk factors?

Publicly traded companies initially disclose their risk factors to the SEC through their S-1 filings as part of the IPO process.

Additionally, companies must provide a complete list of risk factors in their Annual Reports (Form 10-K) or (Form 20-F) for “foreign private issuers”.

Quarterly Reports also include a section on risk factors (Form 10-Q) where companies are only required to update any changes since the previous report.

According to the SEC, risk factors should be reported concisely, logically and in “plain English” so investors can understand them.

How can I use TipRanks risk factors in my stock research?

Use the Risk Factors tab to get data about the risk factors of any company in which you are considering investing.

You can easily see the most significant risks a company is facing. Additionally, you can find out which risk factors a company has added, removed or adjusted since its previous disclosure. You can also see how a company’s risk factors compare to others in its sector.

Without reading company reports or participating in conference calls, you would most likely not have access to this sort of information, which is usually not included in press releases or other public announcements.

A simplified analysis of risk factors is unique to TipRanks.

What are all the risk factor categories?

TipRanks has identified 6 major categories of risk factors and a number of subcategories for each. You can see how these categories are broken down in the list below.

1. Financial & Corporate

Accounting & Financial Operations - risks related to accounting loss, value of intangible assets, financial statements, value of intangible assets, financial reporting, estimates, guidance, company profitability, dividends, fluctuating results.
Share Price & Shareholder Rights – risks related to things that impact share prices and the rights of shareholders, including analyst ratings, major shareholder activity, trade volatility, liquidity of shares, anti-takeover provisions, international listing, dual listing.
Debt & Financing – risks related to debt, funding, financing and interest rates, financial investments.
Corporate Activity and Growth – risks related to restructuring, M&As, joint ventures, execution of corporate strategy, strategic alliances.

2. Legal & Regulatory

Litigation and Legal Liabilities – risks related to litigation/ lawsuits against the company.
Regulation – risks related to compliance, GDPR, and new legislation.
Environmental / Social – risks related to environmental regulation and to data privacy.
Taxation & Government Incentives – risks related to taxation and changes in government incentives.

3. Production

Costs – risks related to costs of production including commodity prices, future contracts, inventory.
Supply Chain – risks related to the company’s suppliers.
Manufacturing – risks related to the company’s manufacturing process including product quality and product recalls.
Human Capital – risks related to recruitment, training and retention of key employees, employee relationships & unions labor disputes, pension, and post retirement benefits, medical, health and welfare benefits, employee misconduct, employee litigation.

4. Technology & Innovation

Innovation / R&D – risks related to innovation and new product development.
Technology – risks related to the company’s reliance on technology.
Cyber Security – risks related to securing the company’s digital assets and from cyber attacks.
Trade Secrets & Patents – risks related to the company’s ability to protect its intellectual property and to infringement claims against the company as well as piracy and unlicensed copying.

5. Ability to Sell

Demand – risks related to the demand of the company’s goods and services including seasonality, reliance on key customers.
Competition – risks related to the company’s competition including substitutes.
Sales & Marketing – risks related to sales, marketing, and distribution channels, pricing, and market penetration.
Brand & Reputation – risks related to the company’s brand and reputation.

6. Macro & Political

Economy & Political Environment – risks related to changes in economic and political conditions.
Natural and Human Disruptions – risks related to catastrophes, floods, storms, terror, earthquakes, coronavirus pandemic/COVID-19.
International Operations – risks related to the global nature of the company.
Capital Markets – risks related to exchange rates and trade, cryptocurrency.

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