OCLN 10-K & 10-Q changes, risk factors and insider trading

For the years ended December 31, 2024,2025, and 2023,2024, we reported a net loss of $(18,970,78913,558,351) and $(11,625,78318,970,789), respectively. Additionally, we recorded aOur loss from operations of was $(7,125,8093,323,046) for the year ended December 31, 2024.2025.

As of December 31, 2024, 2025, we had $23,981,331$2,617,692 in outstanding convertible promissory notes, including $21,363,639 in current secured notes, $597,944 in other current notes, and $2,019,748 in long-term notes. notes. Many of these notes are convertible at a discount, which could dilute stockholders and impact on our stock price.

We expect that a significant portion of our future revenues to reach profitability will come from the saleincrease orin licenseexisting of our technologyoperations and systems.new business ventures. Until we can successfully generate such revenues, we will continue to incur operating losses.

There is no assurance that businesses or prospective customers will adopt our technology and systems or agree to pay for the prices or license fees necessary to support our operations. If we fail to develop these arevenue sufficientstreams, customer base or secure adequate pricing for our products, our financial condition, results of operations, and prospects will be materially and adversely affected.

Our ability to compete effectively and improve future financial performance will depend, in part, on how successfully we manage this growth. Failure to do so could negatively impact on our operations and business prospects.

Additionally, as we are the master licensee of only three limited current patents, we may not be able to prevent the development of competing technologies that use similar methods, materials, or procedures. These competitive pressures could limit our ability to attract customer licenses or generate royalties and fees, which could materially and adversely affect our business, financial condition, and results of operations.

We assemble and sell complete engineered solutions and products utilizing the expertise of PWT and MWS.PWT. Government subsidies that benefit in the industries we serve can vary and may be reduced or eliminated, which could materially and adversely impact on our business. Similarly, more stringent regulations could increase compliance costs or create additional barriers, further negatively affecting our business operations and financial condition.

Our success relies heavily on attracting and retaining skilled scientific, engineering, and management professionals. We are particularly dependent on T. Riggs Eckelberry,Eckelberry and Ken Berenger, CEO and Co-Founder of WODI, whose contributions have been integral to the development of our technology and business. The loss of Mr.either Eckelberry’s servicesperson could significantly impact our operations. As Mr. Eckelberry doesand Mr. Berenger do not have an employment agreement with with us, there is no guarantee of histheir continued association. His leadership remains crucial as we further develop our technology and work toward profitable commercialization. The departure of Mr. Eckelberry or other key personnel could hinder our ability to compete, advance our technology, and execute our business strategies effectively.

Failure to establish, maintain and enforce intellectual property rights may negatively impact on our financial condition, operations and business.

The perceived strength of our intellectual property is critical to the value of our customer licenses. Failure to secure and enforce intellectual property could hinder customer acquisition and materially impact on our business, financial condition, and prospects.

Our ability to license and exploit technology under our patents may also be constrained by the intellectual property rights of others. Numerous U.S. and foreign-issued patents and pending patent applications in our field may have priority over our applications, potentially leading to invalidation or limitations on our rights. Furthermore, our competitors could challenge the validity or enforceability of any patents that are issued fromby our applications.

These risks may impact on our ability to protect and commercialize our intellectual property effectively, which could have a material adverse effect on our business and operations.

Revenue for the years ended December 31, 2024,2025, and 2024 was $6,816,843 and 2023 was $5,541,635 and $6,708,178,$4,407,781 respectively. Cost of goods sold for the same periods was $4,568,923$5,195,767 and $6,081,683,$2,903,053, respectively.respectively

Our working capital deficit increaseddecreased to $(45,437,50819,036,232) from $(32,249,89245,437,508), primarily due to ana increasedecrease in convertible promissory notes and accrued expenses.

We do not have any off-balance sheet arrangements that are reasonably likely to have a current or future effect on our financial condition, revenues, and results of operations, liquidity or capital expenditures.expenditure.

WODIOriginClear, holdsInc. Progressive(“OriginClear,” “OCLN,” or the “Company”) was incorporated in Nevada on June 1, 2007, and focuses primarily on supporting the growth and development of its majority-owned subsidiary, Water Treatment,On Demand, Inc. (“WODI”).Water On Demand WODI has a wholly owned subsidiary PWT Tech Inc. (“PWT”), headquartered in Sherman, Texas, as its sole active revenue-producing business. PWT designs, manufactures, and services custom-engineered water treatment systems for commercial and industrial applications.

During the second quarter of 2025, the WODI Board of Directors approved the wind-down of Modular Water Systems (“MWS”), a previously active design-build unit within WODI. As of SeptemberMarch 30,31, 2025,2026, MWS is no longer in operation, and its financial results are presented as discontinued operations in this report.

Concurrently, WODI formally shifted its strategic focus from manufacturing operations to organization of a financial technology, specificallytoward the development of itsa water infrastructure Fund. Thisfinancing fundplatform, willincluding be organized as anits Opportunity Zone Fund (“OZF”)strategy. The fund structure was designed to financesupport financing for decentralized water treatment systems in underserved communities while leveragingutilizing available federal tax incentivesincentive to attract private capital.structures. The fund hashad been formed but had not yet raised external capital as of SeptemberMarch 30,31, 2025.2026.

The Company, Water onOn DemandDemand, Inc.,Inc. is a C-Corporation and isits insubsidiary, theWODI process of qualifyingLLC, as a Qualified Opportunity Zone Business (“QOZB”). It also intends to createcreated a wholly owned subsidiary WODI Sponsor LLC, which pays the Company to operateoperates the business, and performs functions such as administrativeadministration and contract management fees.management. Capital for WODI Sponsor LLC iswill intendedbe raised by selling membership units in the entity to belimited contributed bypartners. WODI QOZ Fund, designed to become a Qualified Opportunity Fund, in exchange for membership interests. The Company is also the General Partner of the fund, WODI SponsorshipSponsor LLCLLC. (“WODIS”),The whichWOD isQOZ designedFund was established to earnsupport afuture portionproject-related of prospectivecapital Fundraising distributions. The Company is currently selling and/or granting memberships in WODIS to accredited investors, while Regulation A+ investors receive common shares in The Company itself.activities.

On September 16, 2025, the Company entered into a joint venture with Block40X Inc. to form a Wyoming limited liability company (the “Block40X JV”) to develop and manage Bitcoin mining facilities in the United States. Each party holds a 50% membership interest. In connection with the agreement, the Company granted Block40X restricted stock equal to approximately 5% of the Company’s outstanding common shares. The Block40X JV had no material operations, assets, or liabilities as of SeptemberMarch 30,31, 20252026 and will be accounted for under the equity method of accounting.

On September 26, 2025, the Company entered into a joint venture agreement with Bitmern Investments LLC, a subsidiary of Bitmern Technologies LLC, to form a Florida limited liability company (the “Bitmern JV”). Under the agreement, Bitmern holds a 60% ownership interest, and the Company holds 40%. The purpose of the Bitmern JV is to finance,pursue develop,potential construct,digital infrastructure and manage large-scale Bitcoin mining hosting facilities, beginning with a pilot project of up to 500 MWopportunities in the United States, with potential expansions.States. Bitmern will contributecontributes technical expertise, project management, hosting operations, and related intellectual property, while the Company will contributecontributes financing capabilities,activities, capital markets strategy, and compliance support. The Bitmern JV will be governed by a three-member board of managers, with each party appointing one representative and jointly selecting an independent member. Bitmern appoints the Chair and Chief Executive Officer of the JV. The Bitmern JV had not commenced operations or recorded any material assets or liabilitiesoperations as of SeptemberMarch 30,31, 2025,2026 and will beis accounted for under the equity method of accounting.

Results of Operations for the three months ended SeptemberMarch 30,31, 2025,2026 and 2024.2025.

Revenue for the three months ended SeptemberMarch 30,31, 2025,2026, was $1,708,782,$2,002,880, compared to $583,491$1,404,671 for the same period in 2024,2025, increased $1,125,291$598,209 (193%43%). The incline increase was primarily driven by higher equipment contractcontracts and pump station sales revenue.

Cost of goods sold increased to $1,227,164$1,448,752 in 2026, from $900,017 in 2025, from $512,352 in 2024, an increase of $714,812$548,735 (140%61%). As a result, the Company recorded a gross profit of $481,618 $554,128 compared to a profit of $71,139$504,654 in the thirdfirst quarter of 2024.2025.

Selling and marketing expenses were $332,513$406,862 for the quarter ended SeptemberMarch 30,31, 2025,2026, aan decreaseincrease of $464,798$83,329 (589%26%) from $797,311$323,533 in 2024.2025. The decreaseincrease reflects reduced increased advertising and commissions, as well as fewermore project-specific marketing initiatives compared to the prior-year period.

General and administrative expenses totaled $468,468$648,630 for the quarter, compared to $1,472,994$1,112,072 in 2024,2025, a decrease of $1,004,526$463,442 (68%42%). Lower legal and professional fees contributed to the decrease,decrease partiallyas offset bywell increasedas decreased payroll and benefit costs in the current period.

Other income (expense) for the three months ended September 30,March 2025 31, 2026 was  $(2,746,4361,572,166), compared $(304,140)to $76,914 in 2024,2025, a change of $(2,445,2961,649,080). The swing was primarily driven by a $1,699,058 gain on preferred stock conversion in 2024 (nil in 2025). A $1,255,178$909,505 loss on redemption of common stock in 2024 (nil in 2025). Lastly, a $1,716,476 loss on change in derivative liability and a $320,000 loss on debt conversion in 2025 vs. a $756,395 gain in 2024.

Net loss for the three months ended SeptemberMarch 30,31, 2025,2026, was $(3,332,8202,073,530) compared with net loss of $(2,774,472767,034) for the same period in 2024,2025, a change of $558,348. This also includes loss from discontinued operations of $(264,021) vs a loss of $(271,166) in the prior period.$1,306,496. The change was primarily driven by loweran grossincrease profitin derivative losses and swinghigher inexpenses otherassociated incomewith (expense), includingdebt reduced derivative gains and the absence of one-time favorable items recorded in the prior period.conversions.

The financial statements were prepared assuming the Company will continue as a going concern. The Company has incurred recurring losses and held cash of $756,729 $3,310,171 as of SeptemberMarch 30,31, 2025.2026. Management believes continued investor support and access to capital markets will be necessary to sustain operations.

Summary of Cash Flows for the NineThree Months Ended SeptemberMarch 3031