HNOI Amends 10-K, Boosts Stock Comp Expense by $1.1M Amid Green Hydrogen Push

TL;DR

**HNOI's $1.1M stock comp adjustment reveals deeper financial woes; their green hydrogen ambitions are a long shot without serious capital infusion.**

AI Summary

HNO International, Inc. (HNOI) filed a 10-K/A Amendment No. 2 for the fiscal year ended October 31, 2024, primarily to correct the valuation of service stock issuances. This non-cash adjustment increased stock-based compensation expense by $1,108,368, with a corresponding increase to additional paid-in capital and accumulated deficit. The company, a Nevada corporation, focuses on green hydrogen-based clean energy solutions, including hydrogen refueling and generation systems, small to mid-scale green hydrogen production facilities (100kg/day to 5,000kg/day), and hydrogen technologies for existing gasoline and diesel engines. HNOI reported a significant accumulated deficit of $44,326,326 as of October 31, 2024, and has not generated sufficient cash from operations, indicating a need for additional financing. Despite this, HNOI plans to build a manufacturing line for 1.25 MW electrolyzers, establish a Hydrogen Farm in Katy, Texas by April 2025 with expected revenues of $2,500,000 over 15-20 months, and identify 10-15 more hydrogen production locations with projected expenditures of $20,000,000 and revenues of $15,000,000 - $25,000,000 over the next 15-20 months. The company also began marketing its CHRS unit in Q1 2025 and took delivery of 10 Hydrogen Carbon Cleaners in mid-March 2025.

Why It Matters

This 10-K/A highlights HNOI's ongoing financial challenges, with an accumulated deficit of $44,326,326, which is critical for investors to understand its capital needs. The correction of stock-based compensation expense by $1,108,368, while non-cash, impacts the company's reported profitability and equity. For employees and customers, the company's ambitious plans to build hydrogen production facilities, like the Katy, Texas Hydrogen Farm, signal potential growth in the green hydrogen sector, but also depend heavily on successful fundraising. In a competitive landscape dominated by larger players, HNOI's ability to secure financing and execute on its expansion strategy will determine its real-world impact and market position.

Risk Assessment

Risk Level: high — HNO International, Inc. faces a high risk level due to its significant accumulated deficit of $44,326,326 as of October 31, 2024, and its inability to generate sufficient cash from operating activities. The filing explicitly states the company 'will be required to raise additional funds through public or private financing or other arrangements,' indicating a substantial going concern risk. Furthermore, the company's projected expenditures of approximately $20,000,000 over the next 15-20 months for new hydrogen production locations are substantial relative to its current financial state.

Analyst Insight

Investors should exercise extreme caution and conduct thorough due diligence on HNOI's financing capabilities and operational execution. Given the substantial accumulated deficit and reliance on future capital raises, potential investors should wait for clear evidence of successful funding and revenue generation from its planned hydrogen production facilities before considering an investment.

Key Numbers

• $1,108,368 — increase in stock-based compensation expense (due to corrected valuation of service stock issuances for fiscal year ended October 31, 2024)
• $44,326,326 — accumulated deficit (as of October 31, 2024, indicating significant financial losses)
• $14,545,079 — aggregate market value of common equity held by non-affiliates (as of April 30, 2024)
• 79,725,491 — outstanding shares of Common Stock (as of March 20, 2025)
• 2,459,961 — shares of common stock issued (under Regulation A offering from May 16, 2023, to May 5, 2024)
• $450,000 — leased land cost (for the first Hydrogen Farm in Katy, Texas)
• $2,500,000 — expected revenues (from Katy, Texas Hydrogen Farm over next 15-20 months)
• $20,000,000 — expected expenditures (for 10-15 new hydrogen production locations over next 15-20 months)
• $15,000,000 - $25,000,000 — expected revenues (from 10-15 new hydrogen production locations over next 15-20 months)
• $7.5 billion — projected global hydrogen refueling station market size (by 2025, growing at a CAGR of 34.5% from $1.7 billion in 2020)

Key Players & Entities

• HNO International, Inc. (company) — registrant
• SEC (regulator) — filing authority
• Nevada (company) — state of incorporation
• Murrieta, California (company) — principal executive offices location
• Katy, Texas (company) — location of first Hydrogen Farm
• Lancaster, California (company) — location of second hydrogen production site
• MarketsandMarkets (company) — market research firm cited

FAQ

Risk Factors

• Significant Accumulated Deficit and Need for Financing [high — financial]: As of October 31, 2024, HNO International, Inc. has an accumulated deficit of $44,326,326. The company has not generated sufficient cash from operations, indicating a substantial reliance on external financing to fund its ongoing operations and expansion plans. This could lead to dilution for existing shareholders or difficulties in securing necessary capital.
• Execution Risk on New Hydrogen Production Facilities [high — operational]: HNOI plans significant expansion with 10-15 new hydrogen production locations requiring projected expenditures of $20,000,000 and an initial Hydrogen Farm in Katy, Texas with a leased land cost of $450,000. The success of these projects, with projected revenues of $15,000,000 - $25,000,000 over 15-20 months for the new locations and $2,500,000 for the Katy farm, is critical but subject to numerous operational and market risks.
• Dependence on Green Hydrogen Market Growth [medium — market]: The company's business model is heavily dependent on the growth and adoption of green hydrogen technologies. While the projected global hydrogen refueling station market size is $7.5 billion by 2025, actual market penetration and demand for HNOI's specific solutions are subject to competitive pressures, technological advancements, and regulatory support.
• Impact of Stock-Based Compensation Adjustments [medium — financial]: An amendment to the 10-K filing corrected the valuation of service stock issuances, increasing stock-based compensation expense by $1,108,368. While this is a non-cash adjustment, it impacts reported profitability and equity, highlighting potential volatility in financial reporting and the cost of talent acquisition.

Industry Context

HNO International operates in the rapidly expanding green hydrogen sector, driven by global decarbonization efforts. The company aims to capitalize on the projected $7.5 billion global hydrogen refueling station market by 2025. Key competitors likely include established energy companies and specialized hydrogen technology providers, all vying for market share in a nascent but high-growth industry.

Regulatory Implications

As a company in the clean energy sector, HNOI may be subject to evolving environmental regulations and government incentives related to hydrogen production and usage. Compliance with safety standards for hydrogen handling and storage will be critical. The company's use of Regulation A for capital raises also implies adherence to specific SEC disclosure and reporting requirements.

What Investors Should Do

1. Monitor progress on the Katy, Texas Hydrogen Farm and new production site development.
2. Evaluate the company's ability to secure additional financing.
3. Assess the market adoption rate of green hydrogen technologies.
4. Review the impact of stock-based compensation on financial statements.

Key Dates

• 2024-10-31: Fiscal Year End — The period for which the 10-K/A amendment was filed, revealing an accumulated deficit of $44,326,326 and a $1,108,368 increase in stock-based compensation expense due to valuation corrections.
• 2025-04-30: Aggregate Market Value of Common Equity Calculation Date — Reported aggregate market value of common equity held by non-affiliates was $14,545,079.
• 2025-03-20: Outstanding Shares Calculation Date — As of this date, there were 79,725,491 outstanding shares of Common Stock.
• 2025-05-05: Conclusion of Regulation A Offering — The offering, which began on May 16, 2023, concluded, resulting in the issuance of 2,459,961 shares of common stock.
• 2025-04: Targeted Establishment of Hydrogen Farm — HNOI plans to establish its first Hydrogen Farm in Katy, Texas by this date, with expected revenues of $2,500,000 over 15-20 months.
• 2025-03-15: Delivery of Hydrogen Carbon Cleaners — The company took delivery of 10 Hydrogen Carbon Cleaners, indicating progress in product deployment and marketing efforts.

Glossary

Accumulated Deficit

The total net losses of a company since its inception that have not been offset by net income. It represents the cumulative losses incurred by the company. (Indicates HNOI has incurred significant losses, totaling $44,326,326 as of October 31, 2024, highlighting its early-stage or unprofitable operational history.)

Stock-Based Compensation Expense

The cost recognized by a company for equity awards granted to employees and directors, such as stock options or restricted stock units. It's often a non-cash expense. (A $1,108,368 increase in this expense due to corrected valuation highlights the cost associated with attracting and retaining talent through equity, impacting reported net income.)

Regulation A Offering

A U.S. Securities and Exchange Commission (SEC) regulation that allows smaller companies to raise capital from the public with less stringent registration requirements than a traditional IPO. (HNOI utilized this to issue 2,459,961 shares of common stock between May 16, 2023, and May 5, 2024, indicating a method used for capital raising.)

Green Hydrogen

Hydrogen produced using renewable energy sources (like solar or wind) to power the electrolysis of water, resulting in a zero-carbon emission process. (This is the core of HNOI's business strategy, focusing on clean energy solutions and decarbonization.)

Electrolyzer

A device that uses electricity to split water into hydrogen and oxygen through a process called electrolysis. (HNOI plans to build a manufacturing line for 1.25 MW electrolyzers, a key component for green hydrogen production.)

CAGR

Compound Annual Growth Rate, a measure of the average annual growth rate of an investment over a specified period of time longer than one year. (Used to describe the projected growth of the global hydrogen refueling station market, indicating a significant expansion opportunity.)

Year-Over-Year Comparison

The 10-K/A filing for the fiscal year ended October 31, 2024, primarily addresses a correction in stock-based compensation valuation, increasing that expense by $1,108,368. While specific year-over-year financial metrics like revenue, net income, or margins are not detailed in the provided context, the significant accumulated deficit of $44,326,326 and the lack of operational cash flow remain critical financial concerns. New risk factors related to the execution of ambitious expansion plans for hydrogen production facilities have emerged, alongside the ongoing reliance on external financing.

Key Financial Figures

• $0.001 — (g) of the Act: Common Stock, Par Value $0.001 Indicate by check mark if the registr
• $1,108,368 — sed stock-based compensation expense by $1,108,368. This non-cash adjustment also resulted
• $450,000 — leased the land required (approximately $450,000) to build the first Hydrogen Farm locat
• $2,500,000 — n April 2025, with expected revenues of $2,500,000 over next 15-20 months. We have also id
• $20,000,000 — expected expenditures of approximately $20,000,000 over the next 15-20 months and expected
• $15,000,000 — t 15-20 months and expected revenues of $15,000,000 - $25,000,000 over the next 15-20. We
• $25,000,000 — and expected revenues of $15,000,000 - $25,000,000 over the next 15-20. We have taken del
• $44,326,326 — t October 31, 2024, we had a deficit of $44,326,326 and have not been able to generate suff
• $1.7 billion — g station market size was valued at USD $1.7 billion in 2020 and is projected to reach USD $
• $7.5 billion — n in 2020 and is projected to reach USD $7.5 billion by 2025, at a CAGR of 34.5% during the
• $11.6B — n consumption is projected to grow from $11.6B in 2022 to $90B in 2030, growing by a 5
• $90B — rojected to grow from $11.6B in 2022 to $90B in 2030, growing by a 55% CAGR. We are

Filing Documents

• hnoi10312024ka2.htm (10-K/A) — 1143KB
• ex311.htm (EX-31) — 8KB
• ex312.htm (EX-31) — 8KB
• ex321.htm (EX-32) — 4KB
• ex322.htm (EX-32) — 4KB
• image_001.jpg (GRAPHIC) — 35KB
• image_002.jpg (GRAPHIC) — 16KB
• 0001985705-25-000033.txt ( ) — 5411KB
• hnoi-20241031.xsd (EX-101.SCH) — 44KB
• hnoi-20241031_cal.xml (EX-101.CAL) — 46KB
• hnoi-20241031_def.xml (EX-101.DEF) — 215KB
• hnoi-20241031_lab.xml (EX-101.LAB) — 257KB
• hnoi-20241031_pre.xml (EX-101.PRE) — 282KB
• hnoi10312024ka2_htm.xml (XML) — 662KB

Business

Business 5 Item 1A.

Risk Factors

Risk Factors 10 Item 1B. Unresolved Staff Comments 19 Item 2.

Properties

Properties 20 Item 3.

Legal Proceedings

Legal Proceedings 20 Item 4. Mine Safety Disclosures 20 PART II Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 20 Item 6. [Reserved] 24 Item 7.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Management's Discussion and Analysis of Financial Condition and Results of Operations 24 Item 7A.

Quantitative and Qualitative Disclosures About Market Risk

Quantitative and Qualitative Disclosures About Market Risk 27 Item 8.

Financial Statements and Supplementary Data

Financial Statements and Supplementary Data 27 Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure 28 Item 9A.

Controls and Procedures

Controls and Procedures 28 Item 9B. Other Information 28 Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections 29 PART III Item 10. Directors, Executive Officers and Corporate Governance 29 Item 11.

Executive Compensation

Executive Compensation 31 Item 12.

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 32 Item 13. Certain Relationships and Related Transactions and Director Independence 33 Item 14. Principal Accountant Fees and Services 35 PART IV Item 15. Exhibits, Financial Statement Schedules 36 Item 16. Form 10-K Summary 38

Signatures

Signatures 39 3 CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS This report on Form 10-K contains "forward-looking results could differ materially from those anticipated in the forward-looking statements for many reasons, including the risks described in this Form 10-K and other filings we make with the Securities and Exchange Commission. Although we believe the expectations reflected in the forward-looking statements are reasonable, they relate only to events as of the date on which the statements are made. We do not intend to update any of the forward-looking statements after the date of this report to conform these statements to actual results or to changes in our expectations, except as required by law. The following discussion and analysis of financial condition and results of operations is based upon, and should be read in conjunction with our audited financial statements and related notes thereto included elsewhere in this Form 10-K. 4 PART I

BUSINESS

ITEM 1. BUSINESS Company Overview HNO International, Inc., a Nevada corporation (herein referred to as " we ," " us ," " our ," " HNO " and the " Company "), focuses on systems engineering design, integration, and product development to generate green hydrogen-based clean energy solutions to help businesses and communities decarbonize in the near term. HNO stands for "Hydrogen" and "Oxygen" and our experienced management team has over 14 years of expertise in the green hydrogen production industry. HNO provides green hydrogen systems engineering design, integration, and products to multiple markets, which include: (i) the zero-emission vehicle and mobile equipment market consisting of hydrogen fuel cell electric passenger vehicles, material handling equipment such as forklifts and airport ground support equipment, as well as the medium and heavy-duty truck market; (ii) the current and emerging hydrogen gas markets encompassing ammonia, fertilizer, steel, mining, electronics, semiconductors, and fuel cell electric vehicles; (iii) and the gasoline and diesel engine emissions and maintenance reduction product and services market. HNO is at the forefront of developing innovative integrated products that cater to various uses of green hydrogen, both current and future. These include: Hydrogen refueling and generation systems for Fuel Cell Electric vehicles, such as forklifts, drones, cars, and trucks, as well as for zero-emission heating and cooking applications. Small to mid-scale green hydrogen production facilities with a capacity of 100kg/day to 5,000kg/day. These facilities can help decarbonize industrial processes and increase the use of hydrogen and hydrogen-based fuels for transportation and material handling. Hydrogen technologies that decrease emissions and maintenance for existing gasoline and diesel internal combustion engines. This can aid companies in decarbonizing their operations in the short term. On May 16, 2023, the Company began acceptin

Properties

Properties We operate out of an approximately 5,000 square foot facility in Murrieta, California and we are establishing a location in Houston, Texas for our Scalable Green Hydrogen Production farms. Employees As of March 20, 2025, we had one full-time employee and no part-time employees. Environmental Our operations do not pose an environmental risk, and we have no past environmental violations. We also do not require special environmental permits to conduct our business activities. We follow standard policies and procedures for environmental compliance and risk management. We prioritize environmental sustainability and we continuously strive to improve our environmental performance. We recognize that emerging climate change and other environmental issues present potential risks to any business. However, these risks only underscore the need for our products and services. As we continue to grow and expand our business, we will remain vigilant in identifying and addressing potential environmental risks. We want to highlight that our supply chains are diverse and well-shielded, reducing the potential environmental risks associated with our business operations.

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View this 10-K/A filing on SEC EDGAR