What changed in BranchOut Food Inc.'s 2024 10-K compared to 2023?

Across the narrative sections we track, BranchOut Food Inc. (BOF) added 220 paragraphs, removed 210, and edited 140 between the 2023 and 2024 10-K filings. The biggest movers are Item 7. Management's Discussion & Analysis (+96/−72), Item 1A. Risk Factors (+64/−80), Item 1. Business (+46/−42).

Did BranchOut Food Inc. add new Risk Factors in the 2024 10-K?

Yes — Item 1A Risk Factors shows 64 new/edited paragraphs and 80 removed paragraphs versus the 2023 10-K.

What changed in BranchOut Food Inc.'s MD&A (Item 7) in 2024?

Item 7 Management's Discussion & Analysis shows 96 new/edited paragraphs and 72 removed paragraphs year-over-year. Read the side-by-side diff to see exactly which revenue, margin, and outlook commentary was rewritten.

Where does this BOF 10-K diff come from?

The source filings are BranchOut Food Inc.'s official 2023 and 2024 Form 10-K annual reports from SEC EDGAR. 10q10k.net parses each filing, aligns paragraphs by section (Item 1, 1A, 1C, 2, 3, 7, 7A), and highlights every added, removed and edited sentence side-by-side.

What changed in BranchOut Food Inc.'s 10-K — 2023 vs 2024

Paragraph-level year-over-year comparison of BranchOut Food Inc.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+220 added−210 removedSource: 10-K (2025-04-15) vs 10-K (2024-04-01)

Top changes in BranchOut Food Inc.'s 2024 10-K

220 paragraphs added · 210 removed · 140 edited across 5 sections

Item 7. Management's Discussion & Analysis+96 / −72 · 56 edited
Item 1A. Risk Factors+64 / −80 · 48 edited
Item 1. Business+46 / −42 · 24 edited
Item 5. Market for Registrant's Common Equity+10 / −14 · 10 edited
Item 2. Properties+4 / −2 · 2 edited

Item 1. Business

Business — how the company describes what it does

24 edited+22 added−18 removed23 unchanged

2023 filing

2024 filing

Biggest changeProducts in Development We are currently working on several new items at the request of a major national retailer for their private label brand. In addition, we have been in discussions with the U.S. Army about the possibility of including certain of our products in their Meals Ready-to-Eat for their personnel. The U.S.

Biggest changeThe collaboration is expected to generate several million dollars in annual ingredient sales for BranchOut, with upside potential as the partnership expands. Products in Development We are currently working on several new items at the request of major national retailers, consumer product brands and ingredient manufacturers for their private label brand, as well as our own brand.

Continued Expansion of Distribution Footprint Currently, our products are marketed and sold through a diverse set of physical retail channels, including grocery chains, club stores, specialty and natural food outlets, and on our website at www.branchoutfood.com and Amazon.com.

In 2023, we launched a line of vegetable-based snacks including Brussels Sprout Crisps, and Bell Pepper Crisps, and in March 2024 we introduced our Salad Toppers and Kids Snack Pack line aimed at kids’ school lunches. We are also developing Broccoli Bites, Asparagus Sticks, Mango Chips, Mandarin Crisps and others.

As a result, certain highly sensitive fruit, such as avocados and bananas, have not previously been successfully offered as a dehydrated base for consumer products. We believe that BranchOut’s licensed technology platform and process is the only way to produce quality avocado and banana-based snack and powdered products.

As a result, certain highly sensitive fruits, such as avocados and bananas, have not previously been successfully offered as a dehydrated base for consumer products. We believe that our licensed technology platform and process is the only way to produce quality avocado and banana-based snack and powdered products.

We expect the shift in consumer tastes driving the growth of natural and plant-based alternatives will continue throughout the foreseeable future as consumers become better educated on nutrition and focus on the health and wellness.

We expect that the shift in consumer tastes driving the growth of natural and plant-based alternatives will continue for the foreseeable future as consumers become better educated on nutrition and focus on health and wellness.

In addition, BranchOut has its own patent pending process, and has the nonexclusive rights to use the licensed technology platform for other products. We entered into a private labeling contract with one of the world’s largest retailers in late 2022 to supply the retailer with two products for placement in half of their domestic stores.

In addition, BranchOut has the nonexclusive rights to use the licensed technology platform for other products. We entered into a private labeling contract with one of the world’s largest retailers in late 2022 to supply the retailer with two products for placement in half of their domestic stores.

According to widely accepted market data, fresh bananas have historically shown to be the most consumed fruit in America and the highest selling item in grocery stores; however, we do not believe that any banana snack has been offered prior to our “Chewy Banana Bite” product that is of similar quality. 2 Our “Pineapple Chip” product is made up of 100% dried pineapple slices.

Using our licensed technology platform, we believe our line of branded food products speak to current consumer trends. In our experience, conventional dehydration methods, such as freeze-drying and air drying, tend to degrade most fruit and vegetables through oxidation, browning/color degradation, nutritional content reduction and/or flavor loss.

Using our licensed technology platform, we believe our lines of branded, private-label and industrial ingredient products positively address current consumer trends. In our experience, conventional dehydration methods, such as freeze-drying and air drying, tend to degrade most fruit and vegetables through oxidation, browning/color degradation, nutritional content reduction and/or flavor loss.

Expected Increases in Gross Margins, Fixed-Cost Leverage and a Capital Efficient Sales and Marketing Strategy Should Allow Earnings to Grow Faster than Sales, Providing a Path to Profitability While generating topline growth is of primary importance to BranchOut, we are also highly focused on growing earnings faster than net sales and achieving profitability.

We plan to also attempt to leverage our new and existing wholesale relationships to gain additional shelf space for our full suite of existing products. 4 Expected Increases in Gross Margins, Fixed-Cost Leverage and a Capital Efficient Sales and Marketing Strategy Should Allow Earnings to Grow Faster than Sales, Providing a Path to Profitability While generating topline growth is of primary importance to BranchOut, we are also highly focused on growing earnings faster than net sales and achieving profitability.

In particular, if Natural, Organic and Functional Food and Beverage competitors seek to gain or retain market share by reducing prices, we would likely be forced to reduce our prices on similar product offerings in order to remain competitive, which may result in a decrease in our market share, net sales and profitability and may require a change in our operating strategies. 5 We have been able to compete successfully by differentiating ourselves from our competitors by providing an expanding selection of products, competitive pricing, convenience and customer service.

We believe simply penetrating these core markets with our differentiated product lines will provide BranchOut with a large and long-duration growth opportunity. In the near-term, BranchOut plans to focus on growing its share within these categories. We plan to drive growth and brand recognition of both our snacks and nutritional powders through distribution expansion and increased marketing and advertising.

Utilizing the same technology as the Avocado Chips and Chewy Banana Bite products, the Pineapple Chips are made from real pineapple slices and offer a fresh pineapple flavor. In addition, in 2023, we added two vegetable-based snacks, Brussels Sprout Crisps and Bell Pepper Crisps to our BranchOut branded product line.

Our “Pineapple Chip” product is made up of 100% dried pineapple slices. The Pineapple Chips are made from real pineapple slices and offer a fresh pineapple flavor. In addition, we recently added two vegetable-based snacks, Brussels Sprout Crisps and Bell Pepper Crisps to our BranchOut branded product line.

Previous market offerings in the banana snack space include fried plantain chips and dark brown air-dried banana snacks. We believe that our “Chewy Banana Bite” product is superior due to its fresh-looking, natural yellow color, single ingredient base and fresh banana flavor. We offer the banana bites in three flavors, “Original”, “Chocolate Dipped” and “Cinnamon Churro”.

We believe that our “Chewy Banana Bite” product is superior due to its fresh-looking, natural yellow color, single ingredient base and fresh banana flavor. We offer the banana bites in two flavors, “Original”, and “Cinnamon Churro”.

We believe that the move from small batch system dehydration machines to the larger continuous throughput machines, will significantly improve our operating margins. Our new large-scale continuous throughput dehydration machine was commissioned in September 2022 and we completed the first production run in the first quarter of 2023.

Our new large-scale continuous throughput dehydration machine was commissioned in September 2022 and we completed the first production run in the first quarter of 2023.

Employees As of March 29, 2024, we had five full-time employees and one part-time employee. Our employees are not represented by labor unions. We consider our relationship with our employees to be positive. 5

Employees As of March 31, 2025, we had approximately 185 full-time employees, including 180 employees in Peru. Our employees are not represented by labor unions. We consider our relationship with our employees to be positive. 6

Additionally, we believe our licensed technology platform produces superior products when using other fruits and vegetables as the base when compared to conventional drying and dehydration technologies. We license technology, consisting of a portfolio of patents, and purchased production machines, from Enwave, and we have been granted the exclusive rights to use the licensed technology platform as applied to avocados.

We license technology, consisting of a portfolio of patents, and purchased production machines, from EnWave, and we have been granted the exclusive rights to use the licensed technology platform as applied to several core products in Peru, and avocado based products in the United States.

Our products are currently manufactured for us by contract manufacturers based in South America and North America that produce dehydrated fruit and vegetable products for us using a new proprietary dehydration technology that we license from a third party. Our Company’s customers are primarily located throughout the United States.

Our dehydrated fruit and vegetable products are produced using a new proprietary dehydration technology licensed by us from a third party. Our customers are primarily located throughout the United States. In 2024, we decided to initiate our own production facility in Peru to become vertically integrated.

Army has asked us to develop snack concepts for sensory and shelf-life testing, which is currently in progress. Separately, we have been developing a line of salad toppers with one of the largest salad dressing producers in the U.S. Industry We operate in what the U.S.

In addition, we have been in discussions with the U.S. Army about the possibility of including certain of our products in their Meals Ready-to-Eat for their personnel. The U.S. Army has asked us to develop snack concepts for sensory and shelf-life testing, which is currently in progress.

We received net proceeds of $6,226,000 in the IPO after deducting underwriters’ discounts and commissions and before consideration of other issuance costs. In connection with the IPO, a total of $6,029,204 of convertible debt, consisting of $5,526,691 of principal and $502,513 of interest, was converted into 1,572,171 shares of common stock.

In connection with the IPO, a total of $6,029,204 of convertible debt, consisting of $5,526,691 of principal and $502,513 of interest, was converted into 1,572,171 shares of common stock. 2 Our Products We plan to continue to grow revenues strategically by penetrating the multi-billion dollar grocery, industrial ingredient and online market.

In April 2023, the same retailer agreed to carry four additional products of ours in certain of their stores. In June 2023, we completed our initial public offering (“IPO”) in which we issued 1,190,000 shares of common stock at a price of $6.00 per share.

In June 2023, we completed our initial public offering (“IPO”) in which we issued 1,190,000 shares of common stock at a price of $6.00 per share. We received net proceeds of $6,226,000 in the IPO after deducting underwriters’ discounts and commissions and before consideration of other issuance costs.

We are currently developing additional products, including chocolate covered fruit items and private label products for large retailers. BranchOut Snacks Our Avocado Chips are real avocado slices, dehydrated using our licensed technology and process to create crispy, crunchy avocado slices while maintaining their vibrant green color, rich creamy avocado flavor, and superfood nutritional content.

Our Avocado Chips are real avocado slices, dehydrated using our licensed technology and process to create crispy, crunchy avocado slices while maintaining their vibrant green color, rich creamy avocado flavor, and superfood nutritional content. We offer these in three flavors, “Sea Salt with a Hint of Lime”, “Chili Lime” and “Sriracha” seasoned topically on the avocado slices.

Our current primary products are: ● BranchOut Snacks: dehydrated fruit and vegetable-based snacks, including Avocado Chips, Chewy Banana Bites, Pineapple Chips, Brussels Sprout Crisps and Bell Pepper Crisps. ● BranchOut Powders: Avocado Powder, Banana Powder and Blueberry Powder. ● BranchOut Industrial Ingredients: Bulk Avocado Powder, dried avocado pieces and other fruit powders/pieces.

Our current product line includes: ● BranchOut Snacks: dehydrated fruit and vegetable-based snacks, including Avocado Chips, Chewy Banana Bites, Pineapple Chips, Brussels Sprout Crisps, Strawberry Crisps and Bell Pepper Crisps. ● Private Label: Prunes, Carrots, Brussel Sprouts and Raisins sold to major retailers. ● BranchOut Industrial Ingredients: Banana, Mango, Blueberry, Pineapple, Cherry Tomato, Avocado and many others.

We also expect operating margins to be improved by our shifting finished packaging from South America to Texas (which allows us to ship from our contract manufacturers in South America to the U.S. in bulk, reducing costs). We commenced this transition in early 2023. 4 New Product Development We intend to grow by launching new products over time.

We expect operating margins to be further improved in 2025, as we become more vertically integrated with the transition of more of our production from third party contract manufacturers to internal production. New Product Development We intend to grow by launching new products over time.

We offer these in three flavors, “Sea Salt with a Hint of Lime”, “Chili Lime” and “Sriracha” seasoned topically on the avocado slices. In addition to the avocado snack line, we offer a “Chewy Banana Bite”. Each “Banana Bite” is an actual banana slice, providing a unique marshmallow-like, chewy texture.

We also offer a “Chewy Banana Bite”. Each “Banana Bite” is an actual banana slice, providing a unique marshmallow-like, chewy texture. Previous market offerings in the banana snack space include fried plantain chips and dark brown air-dried banana snacks.

Removed

Our Products Over time, we plan to grow revenues strategically by penetrating the multi-billion dollar grocery market opportunity presented by our current product lines, as well as expanding our platform to include additional products that meet our strict plant-based ingredient criteria.

Added

Our products have historically been manufactured for us by two contract manufacturers, one based in the Republic of Chile, and the other in the Republic of Peru, which housed our large-scale continuous through-put dehydration machine that completed its first production run in the first quarter of 2023.

Removed

BranchOut Powders In addition to snack products, we have developed mixable powder products that can be utilized in many different functions. The current powder offerings include, Avocado Powder, Banana Powder and Blueberry Powder, and each are 100% plant-based. We believe that our Avocado Powder is the first and only quality avocado powder on the market.

Added

We recently completed the build out of the new facility (the “Peru Facility”), which commenced operations in December 2024, and utilizes three large-scale REV machines (a REV 60, REV 100 and REV 120) that we recently purchased from EnWave Corporation (“EnWave”), as well as, a small REV 10 R&D machine that is being used for product development and customer sample purposes.

Removed

Fresh avocados are one of the shortest shelf-life items consumers can buy and tend to be expensive. Rather than waiting for fresh avocados to ripen and worrying about spoilage, consumers can simply use our avocado powder. All of our powders have a 12-month shelf life and maintain the natural color, flavor, and nutritional content.

Added

Additionally, we believe our licensed technology platform produces superior products when using other fruits and vegetables when compared to conventional drying and dehydration technologies.

Removed

Currently, consumers are mainly using our powders as additions to homemade smoothies because of their convenience, high flavor and nutritional values. Secondarily, consumers are using our powders for a wide variety of applications, including as ingredients in baked goods, recipes, cocktails, skin care applications and others.

Added

In late 2023, the same retailer agreed to carry two additional products of ours in certain of their stores. In April 2024, we received a commitment from this retailer to carry another product of ours in their stores.

Removed

BranchOut Industrial Ingredients While BranchOut is primarily focused on our snack items, many industrial ingredients opportunities have presented themselves as we have begun marketing the brand. These opportunities include offering bulk avocado powder to ingredient suppliers, inclusion in other food products, pet foods, skin care applications, and many others.

Added

Based on this most recent commitment, our products have been carried in a total of 1,400 of this retailer’s stores as of December 31, 2024. On October 23, 2024, we entered into an At-The-Market Issuance Sales Agreement (the “ATM Agreement”) with Alexander Capital, L.P.

Removed

To date, we have sold our bulk Avocado Powder to several food product manufacturers. While we are currently limiting our supply of these products to preserve our limited production capacity for our branded items, we believe that significant opportunities will be available as we grow our business.

Added

(“Alexander Capital”) for the sale of shares of common stock from time to time through Alexander Capital having an aggregate offering price of up to $3 million.

Removed

Census Bureau estimated to be a $858 billion grocery market in 2023, which is the second largest retail market after the automobile industry. BranchOut is specifically focused on the fastest growing sub-segment of the grocery market: Natural, Organic and Functional Food and Beverages.

Added

As of December 31, 2024, we had sold 1,317,307 shares of common stock under the ATM Agreement resulting in gross proceeds of approximately $2.5 million and aggregate net proceeds of approximately $2.3 million, after deducting expenses, including a 3% commission paid to Alexander Capital.

Removed

According to the Nutrition Business Journal , in 2022, Natural, Organic and Functional Food and Beverages sales in the U.S. were approximately $199 billion and grew 6.6% from the prior.

Added

Subsequent to December 31, 2024, the ATM Agreement was amended to increase the aggregate offering price of shares of common stock that may be sold under the ATM Agreement to $5 million.

Removed

We believe that consumer preferences within the evolving food and beverage industry are shifting away from processed and sugar-laden food and beverage products, as well as those containing significant amounts of highly processed and artificial ingredients. We believe that there is also increasing recognition of the environmental impact of animal-based products.

Added

Following December 31, 2024, we sold 1,303,115 additional shares of common stock under the ATM for gross proceeds of approximately $2.5 million and aggregate net proceeds of approximately $2.4 million.

Removed

This has led to significant growth in plant-based foods and beverages. According to the Plant-Based Foods Association, total U.S. Plant-based Category, defined as products made primarily from plant sources, excluding animal-derived ingredients, in 2023 is estimated at $8 billion and is expected to grow at a CAGR of 12.2% from 2023 to 2033.

Added

As of the date of the filing of this Annual Report on Form 10-K, as a result of such sales of common stock under the ATM Agreement, the Company believes it has stockholders’ equity in excess of $2.5 million, in compliance with Nasdaq Listing Rule 5550(b)(1).

Removed

Among plant-based food categories, plant-based snacks are a rapidly emerging category but, in our opinion, lack product offerings similar to the BranchOut Snacks line. A report published by Persistence Market Research opines that the global plant-based snacks market is poised to witness lucrative growth by clocking a notable Compound Annual Growth Rate (“CAGR”) of 8.7% by the end of 2028.

Added

We are currently developing many additional products for all sales channels. BranchOut Snacks We currently produce all of our BranchOut snack products at our plant in Peru using our licensed technology. Our snacks are mostly single ingredient products.

Removed

North America contributes massively to the growing size of the plant-based snacks market, on account of the rapid adoption of the flexitarian, vegetarian, and vegan diet. The North American plant-based snacks market is projected to produce a healthy CAGR of over 7% and exceed a market value of over US$23.2 billion through 2028.

Added

BranchOut Private Label We also manufacture and supply products to major retailers in North America on a private label basis. The business line allows us to manufacture and supply fruits and vegetables from South America to the distribution centers of major US retailers.

Removed

BranchOut’s long-term goal is to build a scale-level and widely recognized brand and private label solutions that focuses on natural ingredients, nutritional density and functionality in the plant-based snack and nutritional powder space. We believe an authentic and trusted brand is the strongest barrier to entry and a sustainable source of differentiation in the consumer-packaged goods (“CPG”) industry.

Added

BranchOut Industrial Ingredients While BranchOut remains focused on the growth of its branded snack business, demand for industrial ingredients has continued to increase as we expand our market presence. To accelerate the scaling of this growing business line, we have entered into an Agreement with MicroDried, a market leader in premium dried ingredients.

Removed

We also believe a strong brand is a valuable platform that can be leveraged to expand beyond our current markets to achieve relevance across multiple grocery aisles, online and a wide array of other points of distribution.

Added

This partnership leverages MicroDried’s strong industry relationships and sales infrastructure alongside BranchOut’s proprietary GentleDry™ technology. Under the agreement, the companies will collaborate on the production and commercialization of fruit and vegetable pieces, powders and fragments, manufactured at our Peru Facility.

Removed

While the barriers to entry for launching a food product in the CPG industry have fallen in recent years as a result of unlimited shelf space on the internet and targeted online marketing, we believe that the barriers to building an internationally recognized and trusted brand relevant to today’s consumer remain high. 3 Our Growth Strategy Consumers are increasingly incorporating natural alternatives into their diets but there are limited options.

Added

Separately, we have been developing a line of salad toppers with one of the largest salad dressing producers in the U.S. 3 Industry We operate within the U.S. grocery market, which reached approximately $1.5 trillion in 2024, making it the largest retail sector in the country by sales volume.

Removed

BranchOut is seeking to build a high level of brand recognition, as well as develop a trust and understanding with consumers that, regardless of category, any product labeled BranchOut will taste great and maintain a high-quality ingredient set. In addition, we aim to leverage our capabilities by offering major retailers private label products.

Added

Within this market, BranchOut is focused on the growing demand for clean-label, minimally processed snack products that meet modern consumer expectations for quality, convenience, and transparency. The shift in consumer behavior over the past several years has moved firmly away from highly processed, artificial, and sugar-laden packaged foods.

Removed

We plan to drive growth of both our snacks and nutritional powders through distribution expansion and increased marketing and advertising to drive brand recognition and shelf velocity. We plan to also attempt to leverage our new and existing wholesale relationships to gain additional shelf space for our full suite of existing products.

Added

Shoppers are increasingly seeking snacks with short ingredient lists, simple processing, and real food appeal, especially in categories like chips, fruit snacks, and shelf-stable produce alternatives. This trend is reflected in the rapid expansion of premium snack sets in national retailers, club stores, and e-commerce platforms.

Removed

We have been able to compete successfully by differentiating ourselves from our competitors by providing an expanding selection of products, competitive pricing, convenience and customer service.

Added

Among shelf-stable snack technologies, freeze-drying has gained popularity for its ability to extend shelf life while maintaining nutritional integrity. However, freeze-dried products often suffer from poor texture, muted flavor, and high production costs—limitations that have hindered broader consumer adoption. We believe that many traditional snack brands, and freeze-dried products in particular, are failing to meet evolving consumer demands.

Added

BranchOut is uniquely positioned to fill this gap with our proprietary GentleDry™ technology, which delivers superior taste, texture, and color, while preserving up to 95% of the nutrition found in fresh produce.

Added

Our Growth Strategy BranchOut’s long-term goal is to build a scalable and widely recognized brand that delivers exceptional products across multiple grocery aisles, supported by complementary private label and bulk ingredient businesses.

Added

In a category crowded with short-lived brands and lookalike products, we believe that a reputation for quality and trust remains one of the most effective barriers to entry and a critical driver of long-term value in the competitive consumer-packaged goods space. In addition, we aim to leverage our capabilities by offering major retailers private label products.

Added

During 2024, we completed the build out of our 50,000 square-foot facility in Peru, which commenced operations in December 2024, and utilizes three large-scale REV machines that we recently purchased from EnWave, as well as, a small REV 10 R&D machine that is being used for product development and customer sample purposes.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

48 edited+16 added−32 removed156 unchanged

2023 filing

2024 filing

Biggest changeIf we face labor shortages or increased labor costs because of increased competition for employees from our competitors and other industries, higher employee-turnover rates, or increases in the federal- or state-mandated minimum wage, change in exempt and non-exempt status, or other employee benefits costs (including costs associated with health insurance coverage or workers’ compensation insurance), our operating expenses could increase and our business, financial condition and results of operations could be materially and adversely affected.

Biggest changeIf we face labor shortages or increased labor costs, our operating expenses could increase and our business, financial condition and results of operations could be materially and adversely affected. Consumer preferences for natural and organic food products are difficult to predict and may change.

Furthermore, our confidentiality agreements may not effectively prevent disclosure of our proprietary information, technologies and processes and may not provide an adequate remedy in the event of unauthorized disclosure of such information. We might be required to spend significant resources to monitor and protect our intellectual property rights.

Furthermore, our confidentiality agreements may not effectively prevent disclosure of our proprietary information, technologies and processes and may not provide an adequate remedy in the event of unauthorized disclosure of such information. 12 We might be required to spend significant resources to monitor and protect our intellectual property rights.

A product liability judgment against us or a product recall could have a material adverse effect on our business, financial condition, results of operations or liquidity. We may be subject to significant liability that is not covered by insurance.

A product liability judgment against us or a product recall could have a material adverse effect on our business, financial condition, results of operations or liquidity. 13 We may be subject to significant liability that is not covered by insurance.

Our license is exclusive to North America, Central America, and South America (excluding our contract manufacturer in Chile) as it specifically relates to our avocado products and the Licensing Agreement grants non-exclusive rights for a variety of additional products.

Our license is exclusive to North America, Central America, and South America (excluding our contract manufacturer in Chile) as it specifically relates to our avocado products and Peru, and the Licensing Agreement grants non-exclusive rights for a variety of additional products.

The loss of any independent certifications could adversely affect our market position as a natural products company and harm our business. 13 Our future results of operations may be adversely affected by the availability of certifiable ingredients.

The loss of any independent certifications could adversely affect our market position as a natural products company and harm our business. Our future results of operations may be adversely affected by the availability of certifiable ingredients.

In this case, we will request expanding the exclusive and/or non-exclusive products defined by the Licensing Agreement, but there can be no assurance that EnWave will grant such requests. 8 We rely on a small number of suppliers to provide our raw materials, and our supply chain may be interrupted and prevent us from obtaining the necessary materials we need to operate.

In this case, we will request expanding the exclusive and/or non-exclusive products defined by the Licensing Agreement, but there can be no assurance that EnWave will grant such requests. 9 We rely on a small number of suppliers to provide our raw materials, and our supply chain may be interrupted and prevent us from obtaining the necessary materials we need to operate.

If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile. 19

If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile.

There is substantial doubt about our ability to continue as a going concern over the next twelve months and our independent registered public accounting firm has included a “going concern” explanatory paragraph in their report in our financial statements as of and for the years ended December 31, 2023 and 2022.

Our audited financial statements for the years ended December 31, 2023 and 2022 included a statement from our independent registered public accounting firm that there is substantial doubt about our ability to continue as a going concern, and a continuation of negative financial trends could result in our inability to continue as a going concern.

Our audited financial statements for the years ended December 31, 2024 and 2023 included a statement from our independent registered public accounting firm that there is substantial doubt about our ability to continue as a going concern, and a continuation of negative financial trends could result in our inability to continue as a going concern.

Regulatory Risks Our products and operations are subject to government regulation and oversight both in the United States and abroad, and our failure to comply with applicable requirements could adversely affect our business and results of operations. We are affected by a wide range of governmental laws and regulations.

Our products and operations are subject to government regulation and oversight both in the United States and abroad, and our failure to comply with applicable requirements could adversely affect our business and results of operations. We are affected by a wide range of governmental laws and regulations.

Our direct purchases from non-US suppliers represented most of our raw material purchases in 2023 and 2022, and we expect our international purchases to grow. We may in the future also enter into agreements with distributors in foreign countries to sell our products.

Our direct purchases from non-US suppliers represented most of our raw material purchases in 2024 and 2023, and we expect our international purchases to grow. We may in the future also enter into agreements with distributors in foreign countries to sell our products.

If our available cash balances, net proceeds from our IPO and anticipated cash flow from operations are insufficient to satisfy our liquidity requirements, we may seek to sell common stock or other securities, and/or seek additional debt financing.

If our available cash balances, net proceeds from financing activities, and anticipated cash flow from operations are insufficient to satisfy our liquidity requirements, we may seek to sell common stock or other securities, and/or seek additional debt financing.

Our ability to continue our business of growth and distribution of our products is dependent on the licensing agreement (the “Licensing Agreement”) we entered into with EnWave Corporation (“EnWave”) to utilize its dehydration technology in the manufacturing of our products.

Our ability to continue our business of growth and distribution of our products is dependent on the licensing agreement (the “Licensing Agreement”) we entered into with EnWave to utilize its dehydration technology in the manufacturing of our products.

All of these activities are subject to the uncertainties associated with international business operations, including: ● difficulties with foreign and geographically dispersed operations; ● having to comply with various U.S. and international laws; ● changes and uncertainties relating to foreign rules and regulations; ● tariffs, export or import restrictions, restrictions on remittances abroad, imposition of duties or taxes that limit our ability to import necessary materials; ● limitations on our ability to enter into cost-effective arrangements with distributors, or at all; ● fluctuations in foreign currency exchange rates; ● imposition of limitations on production, sale, or export in foreign countries, including due to COVID-19 or other epidemics, pandemics, outbreaks and quarantines; ● imposition of limitations on or increase of withholding and other taxes on remittances and other payments by foreign processors or joint ventures; ● imposition of differing labor laws and standards; ● economic, political, environmental, health-related or social instability in foreign countries and regions; ● an inability, or reduced ability, to protect our intellectual property; ● availability of government subsidies or other incentives that benefit competitors in their local markets that are not available to us; ● difficulties in recruiting and retaining personnel, and managing international operations; ● difficulties in enforcing contracts and legal decisions; and ● less developed infrastructure. 11 In particular, there has been significant recent political instability in Peru and Chile, where our contract manufacturers are located.

All of these activities are subject to the uncertainties associated with international business operations, including: ● difficulties with foreign and geographically dispersed operations; ● having to comply with various U.S. and international laws; 11 ● changes and uncertainties relating to foreign rules and regulations; ● tariffs, export or import restrictions, restrictions on remittances abroad, imposition of duties or taxes that limit our ability to import necessary materials; ● limitations on our ability to enter into cost-effective arrangements with distributors, or at all; ● fluctuations in foreign currency exchange rates; ● imposition of limitations on production, sale, or export in foreign countries, including due to COVID-19 or other epidemics, pandemics, outbreaks and quarantines; ● imposition of limitations on or increase of withholding and other taxes on remittances and other payments by foreign processors or joint ventures; ● imposition of differing labor laws and standards; ● economic, political, environmental, health-related or social instability in foreign countries and regions; ● an inability, or reduced ability, to protect our intellectual property; ● availability of government subsidies or other incentives that benefit competitors in their local markets that are not available to us; ● difficulties in recruiting and retaining personnel, and managing international operations; ● difficulties in enforcing contracts and legal decisions; and ● less developed infrastructure.

We may consider raising additional capital in the future to expand our business, to pursue strategic investments, to take advantage of financing opportunities or for other reasons, including to: ● increase our sales and marketing efforts and address competitive developments; ● provide for supply and inventory costs; ● fund development and marketing efforts of any future products or additional features to then-current products; ● acquire, license or invest in new technologies; and ● acquire or invest in complementary businesses or assets.

We may consider raising additional capital in the future to expand our business, to pursue strategic investments, to take advantage of financing opportunities or for other reasons, including to: ● increase our sales and marketing efforts and address competitive developments; ● provide for supply and inventory costs; ● maintain compliance with Nasdaq listing requirements; ● fund development and marketing efforts of any future products or additional features to then-current products; ● acquire, license or invest in new technologies; and ● acquire or invest in complementary businesses or assets.

The premium organic and natural food industry is sensitive to national and regional economic conditions and the demand for the products that we distribute may be adversely affected from time to time by economic downturns that impact consumer spending, including discretionary spending.

Economic downturns could limit consumer demand for our products and negatively affect our sales and profitability. The premium organic and natural food industry is sensitive to national and regional economic conditions and the demand for the products that we distribute may be adversely affected from time to time by economic downturns that impact consumer spending, including discretionary spending.

Consumer preferences for natural and organic food products are difficult to predict and may change. Our business is primarily focused on sales of non-GMO, organic and natural products, and our success depends, in part, on our ability to offer products that anticipate the tastes and dietary habits of consumers and appeal to their preferences on a timely and affordable basis.

Our business is primarily focused on sales of non-GMO, organic and natural products, and our success depends, in part, on our ability to offer products that anticipate the tastes and dietary habits of consumers and appeal to their preferences on a timely and affordable basis.

The use of such open-source software may subject us to certain conditions, including the obligation to offer, distribute, or disclose our licensed technology platform for no or reduced cost, make the proprietary source code subject to open-source software licenses available to the public, license our software and systems that use open-source software for the purpose of making derivative works, or allow reverse assembly, disassembly, or reverse engineering. 12 We may not be able to enforce our intellectual property rights throughout the world.

While we have implemented administrative and technical controls and taken other preventive actions to reduce the risk of cyber incidents and protect our information technology, they may be insufficient to prevent physical and electronic break-ins, cyber-attacks, or other security breaches to our computer systems, which could have a material adverse effect on our business, financial condition or results of operations. 16 Economic downturns could limit consumer demand for our products and negatively affect our sales and profitability.

As a result of climate change, we may also be subjected to decreased availability of water, deteriorated quality of water or less favorable pricing for water, which could adversely impact our manufacturing and distribution operations, as well as the agricultural businesses of our suppliers, which rely on the availability and quality of water.

If we raise funds by issuing equity securities, dilution to our stockholders could result. Any equity securities issued also could provide for rights, preferences, or privileges senior to those of holders of shares of our common stock.

The various ways we could raise additional capital carry potential risks. If we raise funds by issuing equity securities, dilution to our stockholders could result. Any equity securities issued also could provide for rights, preferences, or privileges senior to those of holders of shares of our common stock.

We have not been profitable to date, and we expect operating losses for the near future. During the years ended December 31, 2023 and 2022, we had net revenue of approximately $2,825,855 and $752,178, respectively, and incurred net losses of approximately $3,925,710 and $4,643,352, respectively.

We have not been profitable to date, and we expect operating losses for the near future. During the years ended December 31, 2024 and 2023, we had net revenue of approximately $6,516,337 and $2,825,855, respectively, and incurred net losses of approximately $4,751,516 and $3,925,710, respectively.

Our present and future funding requirements will depend on many factors, including: ● our ability to achieve revenue growth and improve gross margins; ● the cost of expanding our operations and offerings, including our sales and marketing efforts; ● the effect of competing market developments; and ● costs related to international expansion. 6 The various ways we could raise additional capital carry potential risks.

Our ability and particularly the ability of our contract manufacturers to meet labor needs while controlling labor costs are subject to external factors, such as employment levels, prevailing wage rates, minimum wage legislation, changing demographics, health and other insurance costs and governmental labor and employment requirements.

Labor is a significant component of the cost of operating our business. Our ability to meet labor needs while controlling labor costs are subject to external factors, such as employment levels, prevailing wage rates, minimum wage legislation, changing demographics, health and other insurance costs and governmental labor and employment requirements.

In addition, we could be adversely affected by violations of the U.S. Foreign Corrupt Practices Act, as amended, and similar worldwide anti-bribery laws, which generally prohibit companies and their intermediaries from making improper payments to officials or other third parties for the purpose of obtaining or retaining business.

Foreign Corrupt Practices Act, as amended, and similar worldwide anti-bribery laws, which generally prohibit companies and their intermediaries from making improper payments to officials or other third parties for the purpose of obtaining or retaining business.

If we do not maintain our relationship with existing retailers and distributors or develop relationships with new retailers and distributors, the growth of our business may be adversely affected, and our business may be harmed.

If we do not maintain our relationship with these retailers or develop relationships with new retailers and distributors, the growth of our business may be adversely affected, and our business may be harmed. We do not have long-term purchase agreements with our customers.

As we continue to grow, we will need to make significant investments in multiple divisions of our company, including in sales, marketing, product development, information technology, equipment, facilities, and human resources. We will also need to improve our operational, financial and management controls as well as our reporting systems and procedures.

Alternatively, if a court were to find the choice of forum provision contained in our Articles of Incorporation to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could adversely affect our business and financial condition. 19 We are an emerging growth company and a smaller reporting company, and the reduced reporting requirements applicable to emerging growth companies and smaller reporting companies may make our common stock less attractive to investors.

To be successful we must, among other things: ● develop, manufacture, and introduce new attractive and successful consumer products in our BranchOut brand; ● attract and maintain a large customer base and develop and grow that customer base; ● increase awareness of our BranchOut brand and develop effective marketing strategies to ensure consumer loyalty; ● establish and maintain strategic relationships with key sales, marketing, manufacturing, and distribution providers; ● respond to competitive and technological developments; and ● attract, retain, and motivate qualified personnel. 10 We cannot guarantee that we will succeed in achieving our goals, and our failure to do so would have a material adverse effect on our business, prospects, financial condition, and operating results.

Our executive officers or key personnel could terminate their employment with us at any time without penalty. In addition, we do not maintain key person life insurance policies on any of our employees.

Our success depends largely upon the continued services of our executive officers and other key personnel, particularly our Chief Executive Officer, Eric Healy. Our executive officers or key personnel could terminate their employment with us at any time without penalty. In addition, we do not maintain key person life insurance policies on any of our employees.

Among these changes could be a reduction in the number of natural and organic products that consumers purchase where there are non-organic alternatives, given that many premium natural and organic products, and particularly premium natural and organic foods, often have higher retail prices than do their non-organic counterparts. 16 Regulatory Risks Tariffs imposed on the importation of our products into the United States would increase the cost of our products and could result in decreased demand for our products.

We believe that our ability to compete successfully in this market depends upon many factors both within and beyond our control, including: ● the size and composition of our customer base; ● the number of products that we feature on our website; ● the quality and responsiveness of our customer service; ● our selling and marketing efforts; ● the quality and price of the products that we offer; ● the convenience of the shopping experience that we provide; ● our ability to distribute our products and manage our operations; and ● our reputation and brand strength.

If we are unable to manage our growth effectively, we may be unable to execute our business plan, which could have a material adverse effect on our business and our results of operations.

We will also need to improve our operational, financial and management controls as well as our reporting systems and procedures. 8 If we are unable to manage our growth effectively, we may be unable to execute our business plan, which could have a material adverse effect on our business and our results of operations.

The loss of the BranchOut brand or logo or other registered or common law trade names or a diminution in the perceived quality of products or services associated with the Company would harm our business. Our efforts to protect our intellectual property rights in such countries may be inadequate.

This could make it difficult for us to stop the infringement or the misappropriation of our intellectual property rights. The loss of the BranchOut brand or logo or other registered or common law trade names or a diminution in the perceived quality of products or services associated with the Company would harm our business.

The laws of some foreign countries do not protect intellectual property rights to the same extent as the laws of the United States. Many companies have encountered significant problems in protecting and defending intellectual property rights in certain foreign jurisdictions. This could make it difficult for us to stop the infringement or the misappropriation of our intellectual property rights.

We may not be able to enforce our intellectual property rights throughout the world. The laws of some foreign countries do not protect intellectual property rights to the same extent as the laws of the United States. Many companies have encountered significant problems in protecting and defending intellectual property rights in certain foreign jurisdictions.

Further, our results could be negatively affected if our brand suffers substantial damage to its reputation due to real or perceived quality issues or other actions by the Company or any of its executives. 14 We rely on retailers and distributors for a substantial portion of our sales, and our failure to maintain and further develop our sales channels could harm our business.

We may not be able to implement this growth strategy successfully. Our planned marketing expenditures may not result in increased sales or generate sufficient levels of consumer interest or brand awareness, and our high rates of sales and income growth may not be sustainable over time.

Our planned marketing expenditures may not result in increased sales or generate sufficient levels of consumer interest or brand awareness, and our high rates of sales and income growth may not be sustainable over time. 15 If we face labor shortages or increased labor costs, our results of operations and our growth could be adversely affected.

As of December 31, 2023 and 2022, we had total liabilities of $914,622 and $8,404,033, respectively.

As of December 31, 2024 and 2023, we had total liabilities of $10,514,292 and $914,622, respectively.

We expect each market to have particular regulatory and funding hurdles to overcome, and future developments in these markets, including the uncertainty relating to governmental policies and regulations, could harm our business. If we expend significant time and resources on expansion plans that fail or are delayed, our reputation, business and financial condition may be adversely affected.

If we expand into other target markets, we cannot assure you that our expansion plans will be realized, or if realized, be successful. We expect each market to have particular regulatory and funding hurdles to overcome, and future developments in these markets, including the uncertainty relating to governmental policies and regulations, could harm our business.

In addition, changes in the law and legal decisions by courts in the United States and foreign countries may affect our ability to obtain adequate protection for our technology and the enforcement of intellectual property. Third parties may assert that our employees or consultants have wrongfully used or disclosed confidential information or misappropriated trade secrets.

Our efforts to protect our intellectual property rights in such countries may be inadequate. In addition, changes in the law and legal decisions by courts in the United States and foreign countries may affect our ability to obtain adequate protection for our technology and the enforcement of intellectual property.

The loss of, or business disruption at, one or more of these retailers or distributors or a negative change in our relationship with Costco or Sam’s Club, or a disruption to any one of our sales channels could have a material adverse effect on our business.

The top two retailers of our products for the years ended December 31, 2024 and 2023, accounted for 99% and 90% of our net sales, respectively. The loss of, or business disruption at, one or more of these retailers or distributors or a negative change in our relationship with these retailers could have a material adverse effect on our business.

Our production equipment may be damaged, adversely affecting our ability to meet consumer and wholesale demand. A significant proportion of our products are produced at our contract manufacturers’ facilities in South America.

A significant proportion of our products are produced at our contract manufacturers’ facilities in South America.

Such a widespread health crisis could adversely affect the global economy, resulting in an economic downturn that could impact demand for our products. 9 Competition in the food retail industry is intense and presents an ongoing threat to the success of our business. The food retail industry is very competitive.

Competition in the food retail industry is intense and presents an ongoing threat to the success of our business. The food retail industry is very competitive.

There can be no assurance that political instability in those countries will not materially and adversely affect our contract manufacturers and, in turn, our ability to source our products. If we expand into other target markets, we cannot assure you that our expansion plans will be realized, or if realized, be successful.

In particular, there has been significant recent political instability in Peru and Chile, where our contract manufacturers are located. There can be no assurance that political instability in those countries will not materially and adversely affect our contract manufacturers and, in turn, our ability to source our products.

We are dependent on our management team, and the loss of any key member of this team may prevent us from implementing our business plan in a timely manner, or at all. Our success depends largely upon the continued services of our executive officers and other key personnel, particularly our Chief Executive Officer, Eric Healy.

Accordingly, because of the inherent limitations in our control system, misstatements due to error or fraud may occur and not be detected. Risks Related to Our Business We are dependent on our management team, and the loss of any key member of this team may prevent us from implementing our business plan in a timely manner, or at all.

If our operating results fail to improve, our financial condition will deteriorate which could render us unable to continue as a going concern. We may need to raise additional capital to fund our existing commercial operations and develop and commercialize new products and expand our operations.

If our operating results fail to improve, our financial condition will deteriorate which could render us unable to continue as a going concern. Our failure to meet the continued listing requirements of Nasdaq could result in a delisting of our securities.

We sell a substantial portion of our products through retailers such as Costco, Walmart and Sam’s Club Stores; distributors such as United Natural Foods, Inc. and KeHE Distributors; and online through Amazon.com, and we depend on these third parties to sell our products to consumers.

We rely on big box retailers for a substantial portion of our sales, and our failure to maintain and further develop our sales channels could harm our business. We sell a substantial portion of our products through big box retailers such as Costco, Walmart and Sam’s Club Stores.

We are an emerging growth company and a smaller reporting company, and the reduced reporting requirements applicable to emerging growth companies and smaller reporting companies may make our common stock less attractive to investors. We are an emerging growth company, as defined in the JOBS Act.

We are an emerging growth company, as defined in the JOBS Act.

Removed

Accordingly, because of the inherent limitations in our control system, misstatements due to error or fraud may occur and not be detected. 7 Risks Related to Our Business We rely upon third parties for the manufacture of our products, and have recently been unable to utilize equipment of ours located at one of our manufacturing facilities, which has required us to shift the production of some of our products to a higher-margin manufacturer.

Added

On April 11, 2024, we received a letter from Nasdaq stating that we were not in compliance with Nasdaq Listing Rule 5550(b)(1) (the “Rule”) because our stockholders’ equity of $2,210,476 as of December 31, 2023 was below the minimum requirement of $2,500,000.

Removed

If we continue to be unable to access our equipment, our operating results will be adversely affected. Our products are currently manufactured for us by two contract manufacturers, one based in the Republic of Chile, and the other in the Republic of Peru.

Added

Pursuant to Nasdaq’s Listing Rules, on May 28, 2024, we submitted to Nasdaq a plan to regain compliance with the Rule, which was accepted by Nasdaq and provided us with an extension of 180 calendar days from April 11, 2024 (until October 8, 2024) to regain compliance with the Rule.

Removed

Added

On October 10, 2024, Nasdaq notified us that we did not meet the terms of the extension to regain compliance with the Rule, and as a result, unless we requested an appeal, trading of our common stock would be suspended.

Removed

However, during the fourth quarter of 2023, the contract manufacturer located in Peru became involved in a legal dispute with its landlord and another third party, which resulted in that manufacturer suspending operations. In addition, as a result of such dispute, we currently do not have access to the dehydration machine that was previously operated by this manufacturer.

Added

On October 11, 2024, we submitted a request for a hearing with Nasdaq’s Hearings Panel to appeal Nasdaq’s delisting determination, which stayed the suspension of trading of our common stock.

Removed

Although we have been able to continue to fulfill orders by shifting fulfillment to other manufacturing sources, our costs of goods are expected to increase as a result. In addition, if we are unable to regain access to our dehydration machine and utilize it for the production of our products, our operating results may be materially and adversely affected.

Added

As of November 14, 2024, as a result of the sale of 928,602 Shares under the ATM Agreement for aggregate gross offering proceeds of approximately $1,795,000, we regained compliance with the Rule, and the hearing before the Hearing Panel was cancelled.

Removed

In addition, during 2023, we recognized $761,085 of impairment expense, consisting of $485,265, $243,305 and $32,515 on the collectability of a note receivable, VAT taxes receivable and prepaid inventory, respectively, owed to us by this manufacturer.

Added

However, Nasdaq informed us that it will continue to monitor the Company’s ongoing compliance with the stockholders’ equity requirement and, if we fail to evidence compliance with the Rule upon the filing of its Annual Report on Form 10-K for the year ended December 31, 2024, we may be subject to delisting.

Removed

In addition, we depend on a limited number of key suppliers and partners located primarily in Chile, Peru, the People’s Republic of China (the “PRC”) and the United States.

Added

As of December 31, 2024, we were again not in compliance with the Rule, with stockholders’ equity of $2,341,583 as reported in this Annual Report on Form 10-K.

Removed

For the years ended December 31, 2023 and 2022, three key suppliers accounted for 100% of our total raw material and packaging purchases, and 100% of our total dried fruit was supplied from Chile in 2022 (we commenced receiving dried fruit from Peru as well in January 2023, and 100% of our packaging purchases were from the PRC.

Added

However, as a result of the sale of 1,303,115 additional shares of our common stock under the ATM Agreement following December 31, 2024 for net proceeds of approximately $2.4 million, as of the date of filing this Annual Report on Form 10-K, the Company believes it has regained compliance with the Rule.

Removed

As a result of this concentration in our supply chain, our business and operations would be negatively affected if any of our key suppliers were to experience significant disruption affecting the price, quality, availability, or timely delivery of their products.

Added

However, Nasdaq will continue to monitor the Company’s ongoing compliance with the stockholders’ equity requirement and, if at the time of its next periodic report the Company does not evidence compliance, it may be subject to delisting.

Removed

Additionally, our top suppliers are in a similar geographic area, which increases the risk of significant supply disruptions from local and regional events.

Added

A delisting would likely have a negative effect on the price of our common stock and may impair the ability of our stockholders to sell our stock. 7 We may need to raise additional capital to fund our existing commercial operations and develop and commercialize new products and expand our operations.

Removed

In the event that our supply from our current suppliers is interrupted, our operations may be interrupted resulting in lost revenue, added costs, such as, without limitation, shipping costs, and distribution delays that could harm our business and customer relationships until we are able to identify and enter into agreements with one or more alternative suppliers.

Added

We cannot guarantee that we will succeed in achieving our goals, and our failure to do so would have a material adverse effect on our business, prospects, financial condition, and operating results.

Removed

Our results of operations may be negatively impacted by public health pandemics, epidemics or outbreaks, including COVID-19. COVID-19 and the restrictions intended to prevent its spread have had a significant adverse impact on economic and market conditions around the world, including in the United States.

Added

If we expend significant time and resources on expansion plans that fail or are delayed, our reputation, business and financial condition may be adversely affected. In addition, we could be adversely affected by violations of the U.S.

Removed

These conditions have had, and may continue to have, a material adverse impact on our business. In particular, the continued spread of the coronavirus globally could adversely impact our operations, including among others, our manufacturing and supply chain, sales and marketing and could have an adverse impact on our business and our financial results.

Added

Third parties may assert that our employees or consultants have wrongfully used or disclosed confidential information or misappropriated trade secrets.

Removed

Additionally, countries have imposed, and may impose in the future, prolonged quarantines and travel restrictions, which may significantly impact the ability of our employees to get to their places of work to produce products, may make it such that we are unable to obtain sufficient components or raw materials and component parts on a timely basis or at a cost-effective price or may significantly hamper our products from moving through the supply chain.

Added

We may not be able to implement this growth strategy successfully.

Removed

Our global operations expose us to risks associated with public health crises and epidemics, pandemics and outbreaks, such as the COVID-19 pandemic. We rely on our production facilities, as well as third-party suppliers and manufacturers, in the United States, Peru, Chile, the PRC and other countries significantly impacted by the COVID-19 pandemic.

Added

Our operations and financial results may be adversely impacted by changes in trade policies, including the imposition of tariffs, import/export restrictions, or other trade barriers. A significant portion of our products is manufactured in foreign countries, and as a result, we are subject to tariffs, customs duties, and other trade-related costs.

Removed

The COVID-19 pandemic resulted in the extended shutdown of certain businesses in many of these countries, which has resulted and may continue to result in disruptions or delays to our supply chain. Any disruption in businesses in any of these countries will likely impact our sales and operating results.

Added

While the recent tariffs imposed by President Trump don’t apply to imports from Peru and Chile, if the U.S. or other governments impose new or increased tariffs on goods imported from Peru or other countries where we manufacture our products, it could increase our production costs, reduce our profit margins, and lead to higher prices for consumers, potentially affecting demand for our products.

… 16 more changes not shown on this page.

Item 2. Properties

Properties — owned and leased real estate

2 edited+2 added−0 removed0 unchanged

2023 filing

2024 filing

Biggest changeEach of our employees works remotely and we pay for meeting and office space on an as needed basis with no long-term commitment. We believe that our current facilities are adequate for our current needs.

Biggest changeEach of our U.S. employees works remotely and we pay for meeting and office space on an as needed basis with no long-term commitment. 20 On May 10, 2024, we entered into a ten-year lease for the 50,000 square-foot Peru Facility.

ITEM 2. Properties The address of our principal executive offices is 205 SE Davis Ave., Suite C, Bend, Oregon 97702. We do not maintain offices at the address and do not own or lease office or other space.

ITEM 2. Properties The address of our principal executive offices is 205 SE Davis Ave., Suite C, Bend, Oregon 97702. We do not maintain offices at this address and do not own or lease office or other space in the United States.

Added

The lease of the Peru Facility requires monthly lease payments of $8,000 in the first two years of the lease, $20,000 in the third year of the lease, $22,000 in the fourth year of the lease, $24,000 in the fourth year of the lease, and $25,000 thereafter.

Added

The lease also has a 10-year renewal option, and a buy-out option under which we may purchase the Peru Facility for $1,865,456. We believe that our current facilities are adequate for our current needs.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

10 edited+0 added−4 removed38 unchanged

2023 filing

2024 filing

Biggest changeHigh Low Fiscal Year Ended December 31, 2023 First Quarter $ N/A $ N/A Second Quarter $ 6.20 $ 3.03 Third Quarter $ 3.50 $ 2.02 Fourth Quarter $ 2.10 $ 1.21 As of March 29, 2024, there were 4,044,252 shares of common stock outstanding held by approximately 37 shareholders of record.

Biggest changeHigh Low Fiscal Year Ended December 31, 2024 First Quarter $ 3.60 $ 1.10 Second Quarter $ 3.24 $ 0.68 Third Quarter $ 4.11 $ 0.61 Fourth Quarter $ 2.20 $ 1.31 Fiscal Year Ended December 31, 2023 First Quarter $ N/A $ N/A Second Quarter $ 6.20 $ 3.03 Third Quarter $ 3.50 $ 2.02 Fourth Quarter $ 2.10 $ 1.21 As of April 5, 2025, there were 9,584,769 shares of common stock outstanding held by approximately 25 shareholders of record.

The Compensation Committee will determine the restrictions and conditions applicable to each award of performance shares and performance units. 23 Incentive Bonuses. The Compensation Committee may grant incentive bonus awards under the 2022 Equity Incentive Plan from time to time. The terms of incentive bonus awards will be set forth in award agreements.

The Compensation Committee will determine the restrictions and conditions applicable to each award of performance shares and performance units. Incentive Bonuses. The Compensation Committee may grant incentive bonus awards under the 2022 Equity Incentive Plan from time to time. The terms of incentive bonus awards will be set forth in award agreements.

The number of shares authorized for issuance under the 2022 Equity Incentive Plan and the foregoing share limitations are subject to customary adjustments for stock splits, stock dividends or similar transactions. 22 Terms and Conditions of Options.

Other than individual options outstanding reflected in the table below, we did not have any shares authorized for issuance under equity plans at December 31, 2023.

Other than individual options outstanding reflected in the table below, we did not have any shares authorized for issuance under equity plans at December 31, 2024.

There can be no assurance, therefore, that any dividends on our common stock will ever be paid. Equity Compensation Plan Information This following table provides information about shares our common stock that may be issued under our options outstanding at December 31, 2023.

There can be no assurance, therefore, that any dividends on our common stock will ever be paid. 22 Equity Compensation Plan Information This following table provides information about shares our common stock that may be issued under our options outstanding at December 31, 2024.

Tax Withholding As and when appropriate, we shall have the right to require each optionee purchasing shares of common stock and each grantee receiving an award of shares of common stock under the 2022 Equity Incentive Plan to pay any federal, state, or local taxes required by law to be withheld.

“Incentive stock options”, or ISOs, that are intended to meet the requirements of Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”) may be granted under the 2022 Equity Incentive Plan with respect to all of the shares of common stock authorized for issuance under the 2022 Equity Incentive Plan.

As of December 31, 2024, the annual increases to the plan resulted in 1,009,000 shares being able to be issued under the plan. 23 “Incentive stock options”, or ISOs, that are intended to meet the requirements of Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”) may be granted under the 2022 Equity Incentive Plan with respect to all of the shares of common stock authorized for issuance under the 2022 Equity Incentive Plan.

Plan category Number of securities to be issued upon exercise of outstanding options, warrants and rights Weighted-average exercise price of outstanding options, warrants and rights Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) (a) (b) (c) Equity compensation plans approved by security holders 169,304 $ 3.47 430,696 Equity compensation plans not approved by security holders (1) 82,110 7.20 N/A Total 251,414 $ 4.69 430,696 (1) Represents warrants issued on June 21, 2023 to the underwriter in the Company’s IPO. 21 2022 Equity Incentive Plan General Our board of directors and stockholders adopted the 2022 Equity Incentive Plan as of January 1, 2022, which provides for the grant of incentive stock options and non-qualified stock options to purchase shares of our common stock and other types of awards.

Plan category Number of securities to be issued upon exercise of outstanding options, warrants and rights Weighted-average exercise price of outstanding options, warrants and rights Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) (a) (b) (c) Equity compensation plans approved by security holders 593,470 $ 2.39 415,530 Equity compensation plans not approved by security holders (1) 182,735 3.76 N/A Total 776,205 $ 2.71 415,530 (1) Represents warrants issued on June 21, 2023 to the underwriter in the Company’s IPO, and warrants issued on June 26, 2024 to underwriter in our follow-on public offering. 2022 Equity Incentive Plan General Our board of directors and stockholders adopted the 2022 Equity Incentive Plan as of January 1, 2022, which provides for the grant of incentive stock options and non-qualified stock options to purchase shares of our common stock and other types of awards.

Generally, each SAR will entitle a participant upon exercise to an amount equal to: ● the excess of the fair market value on the exercise date of one share of our common stock over the exercise price, multiplied by ● the number of shares of common stock covered by the SAR. 24 Payment may be made in shares of our common stock, in cash, or partly in common stock and partly in cash, all as determined by the Compensation Committee.

Restricted stock awards consist of shares of stock that are transferred to a participant subject to restrictions that may result in forfeiture if specified conditions are not satisfied.

Restricted Stock and Restricted Stock Units. The Compensation Committee may award restricted common stock and/or restricted stock units under the 2022 Equity Incentive Plan. Restricted stock awards consist of shares of stock that are transferred to a participant subject to restrictions that may result in forfeiture if specified conditions are not satisfied.

Removed

Payment may be made in shares of our common stock, in cash, or partly in common stock and partly in cash, all as determined by the Compensation Committee. Restricted Stock and Restricted Stock Units. The Compensation Committee may award restricted common stock and/or restricted stock units under the 2022 Equity Incentive Plan.

Removed

Use of Proceeds from Registered Securities On June 15, 2023, we entered into an underwriting agreement with Alexander Capital, L.P. as the representative of the underwriters named therein, pursuant to which we issued and sold 1,190,000 shares of common Stock in our IPO at a price to the public of $6.00 per share, less underwriting discounts and commissions.

Removed

The IPO closed on June 21, 2023, and we received net proceeds of $6,226,000 after deducting the underwriters’ discount of 9.0% and other offering expenses.

Removed

There has been no material change in the planned use of proceeds from the IPO as described in our final prospectus for the IPO filed with the SEC on June 21, 2023 pursuant to Rule 424(b).” Issuer Purchase of Equity Securities None.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

56 edited+40 added−16 removed49 unchanged

2023 filing

2024 filing

Biggest changeThere have been no royalty payments to date, and any future minimum royalty payments or equipment purchases under this license agreement are an unrecognized commitment as they relate to retaining exclusivity of the avocado products going forward and the Company can elect not to pay as disclosed in Note 17 to the financial statements included in this 10-K. 28 Derivatives The Company evaluates convertible notes payable, stock options, stock warrants and other contracts to determine if those contracts or embedded components of those contracts qualify as derivatives to be separately accounted for under the relevant sections of ASC Topic 815-40, Derivative Instruments and Hedging: Contracts in Entity’s Own Equity.

Biggest changeAny future minimum royalty payments or equipment purchases under this license agreement are an unrecognized commitment as they relate to retaining exclusivity of the avocado products going forward and the Company can elect not to pay as disclosed in Note 17 to the financial statements included in this 10-K.

Pursuant to the Underwriting Agreement, we also issued the Underwriter a Common Stock Purchase Warrant to purchase up to 82,110 shares of Common Stock at an exercise price of $7.20, which may be exercised for a five-year period beginning December 18, 2023. Prior to the IPO, all deferred offering costs were capitalized in other noncurrent assets on the balance sheets.

Pursuant to the Underwriting Agreement, we also issued the Underwriter a Common Stock Purchase Warrant to purchase up to 82,110 shares of Common Stock at an exercise price of $7.20, which may be exercised for a five-year period beginning December 18, 2023. 27 Prior to the IPO, all deferred offering costs were capitalized in other noncurrent assets on the balance sheets.

The report of the Company’s independent registered public accounting firm that accompanies its audited financial statements in this Annual Report on Form 10-K contains an explanatory paragraph regarding the substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of the going concern uncertainty.

The report of our independent registered public accounting firm that accompanies our audited financial statements in this Annual Report on Form 10-K contains an explanatory paragraph regarding the substantial doubt about our ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of the going concern uncertainty.

There were no cash equivalents on hand on December 31, 2023 and 2022. Cash in Excess of FDIC Insured Limits The Company maintains its cash in bank deposit accounts which, at times, may exceed federally insured limits. Accounts are guaranteed by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000, under current regulations.

There were no cash equivalents on hand on December 31, 2024 and 2023. 28 Cash in Excess of FDIC Insured Limits The Company maintains its cash in bank deposit accounts which, at times, may exceed federally insured limits. Accounts are guaranteed by the Federal Deposit Insurance Corporation (“FDIC”) up to $250,000, under current regulations.

ITEM 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations This discussion summarizes the significant factors affecting the operating results, financial condition, liquidity and cash flows of the Company for the fiscal years ended December 31, 2023 and 2022.

For the years ended December 31, 2023 and 2022, potential dilutive securities had an anti-dilutive effect and were not included in the calculation of diluted net loss per common share.

For the years ended December 31, 2024 and 2023, potential dilutive securities had an anti-dilutive effect and were not included in the calculation of diluted net loss per common share.

The assessment of the Company’s tax position relies on the judgment of management to estimate the exposures associated with the Company’s various filing positions. 30 Results of Operations for the Years Ended December 31, 2023 and 2022 The following table summarizes selected items from the statement of operations for the years ended December 31, 2023 and 2022, respectively.

The assessment of the Company’s tax position relies on the judgment of management to estimate the exposures associated with the Company’s various filing positions. 31 Results of Operations for the Years Ended December 31, 2024 and 2023 The following table summarizes selected items from the statement of operations for the years ended December 31, 2024 and 2023, respectively.

Depreciation expense was $223,856 and $93,253 for the years ended December 31, 2023 and 2022, respectively. Impairment of Long-Lived Assets Long-lived assets held and used by the Company are reviewed for possible impairment whenever events or circumstances indicate the carrying amount of an asset may not be recoverable or is impaired.

Depreciation expense was $171,873 and $223,856 for the years ended December 31, 2024 and 2023, respectively. Impairment of Long-Lived Assets Long-lived assets held and used by the Company are reviewed for possible impairment whenever events or circumstances indicate the carrying amount of an asset may not be recoverable or is impaired.

The Company had $407,789 and $62,697 in excess of FDIC insured limits on December 31, 2023 and 2022, respectively, and has not experienced any losses in such accounts. Accounts Receivable Accounts receivable is carried at their estimated collectible amounts. Trade accounts receivable is periodically evaluated for collectability based on past credit history with customers and their current financial condition.

The Company had $1,555,223 and $407,789 in excess of FDIC insured limits on December 31, 2024 and 2023, respectively, and has not experienced any losses in such accounts. Accounts Receivable Accounts receivable is carried at their estimated collectible amounts. Trade accounts receivable is periodically evaluated for collectability based on past credit history with customers and their current financial condition.

The Company issued stock-based compensation in the amount of $258,574 and $93,521 for the years ended December 31, 2023 and 2022, respectively. Basic and Diluted Loss Per Share The basic net loss per common share is computed by dividing the net loss by the weighted average number of common shares outstanding.

The Company issued stock-based compensation in the amount of $704,699 and $258,574 for the years ended December 31, 2024 and 2023, respectively. Basic and Diluted Loss Per Share The basic net loss per common share is computed by dividing the net loss by the weighted average number of common shares outstanding.

Access to our Equipment in Peru; NXTDried Superfoods During the fourth quarter of 2023, NXTDried Superfoods, our contract manufacturer located in Peru, became involved in a legal dispute with its landlord and another third party, which resulted in that manufacturer suspending operations.

NXTDried Superfoods During the fourth quarter of 2023, NXTDried Superfoods, one of our former contract manufacturers located in Peru, became involved in a legal dispute with its landlord and another third party, which resulted in that manufacturer suspending operations.

We evaluate the recoverability of intangible assets periodically by considering events or circumstances that may warrant revised estimates of useful lives or that indicate the asset may be impaired. The Company expenses internally developed trademarks.

We evaluate the recoverability of intangible assets periodically by considering events or circumstances that may warrant revised estimates of useful lives or that indicate the asset may be impaired.

Costs include purchase costs, product development, freight-in, packaging, and print production costs. 29 Advertising Costs The Company expenses the cost of advertising and promotions as incurred. Advertising and promotions expense was $162,048 and $199,287 for the years ended December 31, 2023 and 2022, respectively.

Costs include purchase costs, product development, freight-in, packaging, and print production costs. Advertising Costs The Company expenses the cost of advertising and promotions as incurred. Advertising and promotions expense was $311,586 and $162,048 for the years ended December 31, 2024 and 2023, respectively.

The par value of the common stock was not adjusted by the reverse stock split. 26 Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that may affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.

Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that may affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period.

The largest components of our general and administrative expenses are advertising and marketing, travel, storage, shipping and handling, commissions and asset impairment expense.

The largest components of our general and administrative expenses are advertising and marketing, rent, travel, commissions, and storage, shipping and handling expense, as shown below.

This increase was primarily attributable to increased property and equipment purchases, as partially offset by advances received on notes receivable in the prior period that were not replicated in the current period.

This increase was primarily attributable to increased property and equipment purchases of $2,847,207 during the current year, as partially offset by $24,646 of advances received on notes receivable in the current year that were not replicated in the prior year, and $116,565 of property and equipment purchases in the prior year.

Our gross profit margin increased primarily due to cost savings realized as a result of our transition to bulk shipping arrangements during the current period. General and Administrative Expense Our general and administrative expense for the year ended December 31, 2023 was $1,581,474, compared to $929,726 for the year ended December 31, 2022, an increase of $651,748, or 70%.

Our gross profit margin increased primarily due to cost savings realized as a result of our transition to bulk shipping arrangements and transitioning to our own production facility during the current period. 32 General and Administrative Expense Our general and administrative expense for the year ended December 31, 2024 was $1,870,720, compared to $1,581,474 for the year ended December 31, 2023, an increase of $289,246, or 18%.

As a result of the foregoing, we had a gross operating loss of $96,230, or (3%), for the year ended December 31, 2023, as compared to a gross operating loss of $170,550, or (23%), for the year ended December 31, 2022.

As a result of the foregoing, we had a gross profit of $863,620, or 13% of revenues, for the year ended December 31, 2024, compared to a gross operating loss of $96,230, or (3%) of revenues, for the year ended December 31, 2023.

The Company operates as a single segment and will evaluate additional segment disclosure requirements as it expands its operations. Fair Value of Financial Instruments ASC 820, Fair Value Measurements and Disclosures , establishes a fair value hierarchy for instruments measured at fair value that distinguishes between assumptions based on market data (observable inputs) and the Company’s own assumptions (unobservable inputs).

Fair Value of Financial Instruments ASC 820, Fair Value Measurements and Disclosures , establishes a fair value hierarchy for instruments measured at fair value that distinguishes between assumptions based on market data (observable inputs) and the Company’s own assumptions (unobservable inputs).

The license agreement also entitles the licensor to a royalty on all revenue from the sale of products produced using the equipment. These royalties are recognized as royalty expenses as the products are sold.

The license is not discernible from the equipment; therefore, the license costs have been capitalized and depreciated over the useful life of the equipment. The license agreement also entitles the licensor to a royalty on all revenue from the sale of products produced using the equipment. These royalties are recognized as royalty expenses as the products are sold.

Professional Fees Professional fees for the year ended December 31, 2023 was $694,596, compared to $583,920 for the year ended December 31, 2022, an increase of $110,676, or 19%. This increase was primarily attributable to increased consulting fees.

Professional Fees Professional fees for the year ended December 31, 2024 was $1,291,141, compared to $694,596 for the year ended December 31, 2023, an increase of $596,545, or 86%. This increase was primarily attributable to increased consulting fees.

Inventory, consisting of raw materials and finished goods are stated at the lower of cost or net realizable value using the average cost valuation method, at December 31, 2023 and 2022, consisted of the following: December 31, 2023 2022 Raw materials $ 13,734 $ 10,824 Finished goods 323,071 148,937 Total inventory $ 336,805 $ 159,761 The Company had prepaid inventory advances on product in the amount of $29,500 as of December 31, 2022.

Inventory, consisting of raw materials and finished goods are stated at the lower of cost or net realizable value using the average cost valuation method, at December 31, 2024 and 2023, consisted of the following: December 31, 2024 2023 Raw materials $ 464,681 $ 13,734 Finished goods 1,465,854 323,071 Total inventory $ 1,930,535 $ 336,805 The Company had prepaid inventory advances on products in the amount of $123,792 and $-0- as of December 31, 2024 and 2023, respectively.

The Company had no allowance for doubtful accounts on December 31, 2023 and 2022. 27 Inventory The Company’s products consist of pre-packaged and bulk-dried fruit and vegetable-based snacks, powders and ingredients purchased from contract-manufacturers in Chile and/or Peru. The Company’s contract manufacturer in Peru uses equipment purchased by the Company in its manufacturing process. Raw materials consist of packaging materials.

The Company had an allowance for doubtful accounts of $25,586 at December 31, 2024. No allowance for doubtful accounts was necessary at December 31, 2023. Inventory The Company’s products consist of pre-packaged and bulk-dried fruit and vegetable-based snacks, powders and ingredients purchased from contract-manufacturers in Chile and/or Peru.

D uring 2023, we recognized $761,085 of impairment expense, consisting of $485,265, $243,305 and $32,515 on the collectability of a note receivable, VAT taxes receivable and prepaid inventory, respectively , owed to us by NXTDried Superfoods. Peru Facility Lease Given the situation with NXTDried Superfoods, we were required to shift fulfillment of orders to alternative manufacturing sources.

Net Cash Used in Investing Activities Net cash used in investing activities was $116,565 for the year ended December 31, 2023, compared to $22,436 for the year ended December 31, 2022, an increase of $94,129, or 420%.

Net Cash Used in Investing Activities Net cash used in investing activities was $2,822,561 for the year ended December 31, 2024, compared to $116,565 for the year ended December 31, 2023, an increase of $2,705,996, or 2,321%.

No assurance can be given that any future financing will be available or, if available, that it will be on terms that are satisfactory to us. Even if we are able to obtain additional financing, it may contain undue restrictions on our operations or cause substantial dilution for our stockholders.

Even if we are able to obtain additional financing, it may contain undue restrictions on our operations or cause substantial dilution for our stockholders. We cannot guarantee that we will become profitable.

The increase in revenue was primarily due to increased sales to big box retailers during the year ended December 31, 2023. Cost of Goods Sold and Gross Loss Our cost of goods sold for the year ended December 31, 2023 was $2,922,085, compared to $922,728 for the year ended December 31, 2022, an increase of $1,999,357, or 217%.

The increase in revenue was primarily due to increased sales to our largest customer during the year ended December 31, 2024. Cost of Goods Sold and Gross Profit (Loss) Our cost of goods sold for the year ended December 31, 2024 was $5,652,717, compared to $2,922,085 for the year ended December 31, 2023, an increase of $2,730,632, or 93%.

Expenses such as slotting fees, sales discounts, and allowances are accounted for as a direct reduction of revenues as follows: December 31, 2023 2022 Gross revenue $ 3,184,018 $ 888,893 Less: slotting, discounts, and allowances 358,163 136,715 Net revenue $ 2,825,855 $ 752,178 Cost of Goods Sold Cost of goods sold represents costs directly related to the purchase, production and manufacturing of the Company’s products.

Payment terms in the Company’s invoices are based on the billing schedule established in contracts and purchase orders with customers. 30 Expenses such as slotting fees, sales discounts, and allowances are accounted for as a direct reduction of revenues as follows: December 31, 2024 2023 Gross revenue $ 6,777,079 $ 3,184,018 Less: slotting, discounts, and allowances 260,742 358,163 Net revenue $ 6,516,337 $ 2,825,855 Cost of Goods Sold Cost of goods sold represents costs directly related to the purchase, production and manufacturing of the Company’s products.

Cost of goods sold included $223,856 of depreciation on production equipment during the year ended December 31, 2023. Cost of goods sold increased primarily in line with the increase in our sales for the period and a reduction in our shipping costs, which, in turn, was primarily a result of our transition to bulk shipping arrangements.

Cost of goods sold included $171,843 and $223,856 of depreciation on production equipment during the years ended December 31, 2024 and 2023, respectively. Cost of goods sold increased primarily in line with the increase in our sales for the period.

We are too early in our development stage to project revenue with a necessary level of certainty; therefore, we may not have sufficient funds to sustain our operations for the next twelve months and we may need to raise additional cash to fund our operations. These factors raise substantial doubt about our ability to continue as a going concern.

If we continue to generate substantial operating losses, we will not have sufficient funds to sustain our operations for the next twelve months and we will need to raise additional cash to fund our operations. These factors raise substantial doubt about our ability to continue as a going concern.

Net Cash Provided by Financing Activities Net cash provided by financing activities was $3,755,279 for the year ended December 31, 2023, compared to $2,182,482 for the year ended December 31, 2022, an increase of $1,572,797, or 72%.

Net Cash Provided by Financing Activities Net cash provided by financing activities was $9,362,621 for the year ended December 31, 2024, compared to $3,755,279 for the year ended December 31, 2023, an increase of $5,607,342, or 149%.

The financial statements do not include any adjustments related to the recoverability and classification of recorded asset amounts or the amounts and classification of liabilities that might be necessary should we be unable to continue as a going concern. 33 Off-Balance Sheet Arrangements We did not have any off-balance sheet arrangements, such as structured finance, special purpose entities, or variable interest entities during the years ended December 31, 2023 and 2022.

Appropriate consideration is given to obsolescence, excessive levels, deterioration, and other factors in evaluating net realizable value. No reserve for obsolete inventories has been recognized.

The Company’s contract manufacturer in Peru uses equipment purchased by the Company in its manufacturing process. Raw materials consist of packaging materials. Appropriate consideration is given to obsolescence, excessive levels, deterioration, and other factors in evaluating net realizable value. No reserve for obsolete inventories has been recognized.

The increase was primarily due to increased accounts receivable, inventory purchases and payments on accounts payable from the proceeds of our IPO, in addition to $761,085 of impairment expense on the collectability of a note receivable, VAT taxes receivable and prepaid inventory .

The increase was primarily due to our increased net loss and increased purchases of inventory and other assets, as adjusted for increased stock-based compensation, increased accounts payable, and $761,085 of impairment expense on the collectability of a note receivable, VAT taxes receivable and prepaid inventory during the prior year .

Our storage, shipping and handling expenses increased primarily due to increased international shipping rates, and commissions increased due to our increased shipments on sales during the current year.

Commissions increased due to our increased sales, and storage, shipping and handling expenses increased primarily due to increased international shipping rates and increased production that was driven by our increased sales.

Salaries and Wages Salaries and wages for the year ended December 31, 2023 was $1,129,858, compared to $628,637 for the year ended December 31, 2022, an increase of $501,221, or 80%. This increase was primarily attributable to increased headcount in line with our expanded operations.

Salaries and Wages Salaries and wages for the year ended December 31, 2024 was $1,604,200, compared to $1,129,858 for the year ended December 31, 2023, an increase of $474,342, or 42%. This increase was primarily attributable to increased headcount in line with our expanded operations, including $414,614 of non-cash, stock-based compensation related to stock options awarded during the current year.

We are engaged in the development, marketing, sale, and distribution of plant-based, dehydrated fruit and vegetable snacks and powders. Our products are currently manufactured for us by two contract manufacturers, one based in the Republic of Chile, and the other in the Republic of Peru.

We are engaged in the development, marketing, sale, and distribution of plant-based, dehydrated fruit and vegetable snacks and powders.

Net loss Net loss for the year ended December 31, 2023 was $3,925,710, compared to $4,643,352 during the year ended December 31, 2022, a decreased net loss of $717,642, or 15%.

Net loss Net loss for the year ended December 31, 2024 was $4,751,516, compared to $3,925,710 during the year ended December 31, 2023, an increased net loss of $825,806, or 21%.

The Company does not receive a distinct service in relation to the advertising, consumer incentives and trade promotions. Payment terms in the Company’s invoices are based on the billing schedule established in contracts and purchase orders with customers.

The Company does not receive a distinct service in relation to the advertising, consumer incentives and trade promotions.

Deferred offering costs of $1,283,954, primarily consisting of accounting, legal, and other fees related to the Company’s IPO, were offset against the IPO proceeds upon the closing of the IPO in June 2023. As of December 31, 2023, all deferred offering costs were paid. Unpaid deferred offering costs totaled $543,664 as of December 31, 2022.

Deferred offering costs of $1,283,954, primarily consisting of accounting, legal, and other fees related to the Company’s IPO, were offset against the IPO proceeds upon the closing of the IPO in June 2023. Reverse Stock Split On June 15, 2023, we effected a 2.5-for-1 reverse stock split of our outstanding shares of capital stock.

As of December 31, 2022, we had cash of $312,697, total liabilities of $8,404,033, and an accumulated deficit of $8,884,831. 32 Cash Flow Comparison of the Year Ended December 31, 2023 and the Year Ended December 31, 2022 The following table sets forth the primary sources and uses of cash for the periods presented below: Year Ended December 31, 2023 2022 Net cash used in operating activities $ (3,529,372 ) $ (2,467,681 ) Net cash used in investing activities (116,565 ) (22,436 ) Net cash provided by financing activities 3,755,279 2,182,482 Net change in cash $ 109,342 $ (307,635 ) Net Cash Used in Operating Activities Net cash used in operating activities was $3,529,372 for the year ended December 31, 2023, compared to $2,467,681 for the year ended December 31, 2022, an increase of $1,061,691, or 43%.

Cash Flow Comparison of the Year Ended December 31, 2024 and the Year Ended December 31, 2023 The following table sets forth the primary sources and uses of cash for the periods presented below: Year Ended December 31, 2024 2023 Net cash used in operating activities $ (4,859,816 ) $ (3,529,372 ) Net cash used in investing activities (2,822,561 ) (116,565 ) Net cash provided by financing activities 9,362,621 3,755,279 Effect of exchange rate changes on cash (8,581 ) - Net change in cash $ 1,671,663 $ 109,342 Net Cash Used in Operating Activities Net cash used in operating activities was $4,859,816 for the year ended December 31, 2024, compared to $3,529,372 for the year ended December 31, 2023, an increase of $1,330,444, or 38%.

We license technology, consisting of a portfolio of patents, and purchased production machines, from EnWave, and we have been granted the exclusive rights to use the licensed technology platform as applied to several products in Peru, and avocado based products in the United States. In addition, BranchOut has the nonexclusive rights to use the licensed technology platform for other products.

Other Income (Expense) In the year ended December 31, 2023, other expense was $423,552, consisting of $435,271 of interest expense, as partially offset by $11,719 of interest income. During the year ended December 31, 2022, other expense was $2,237,266, consisting of $2,250,893 of interest expense, as partially offset by $13,627 of interest income.

During the year ended December 31, 2023, other expense was $423,552, consisting of $435,271 of interest expense, as partially offset by $11,719 of interest income. Other expense increased by $425,523, or 100%, primarily due to interest on increased outstanding debt as we funded our expansion into Peru during the current year.

We are currently developing additional products, including chocolate covered fruit items and private label products for large retailers. 25 Going Concern Uncertainty As of December 31, 2023, we had a cash balance of $657,789, have incurred recurring losses from operations resulting in an accumulated deficit of $12,810,541, and had total working capital of $899,150.

We are currently developing many additional products for all sales channels. 26 Going Concern Uncertainty As of December 31, 2024, we had a cash balance of $2,329,452, a working capital deficit of $3,897,382 and had incurred recurring losses from operations resulting in an accumulated deficit of $17,562,057.

Year Ended December 31, 2023 2022 Difference % change Advertising and marketing $ 162,048 $ 322,830 $ (160,782 ) (50 )% Travel $ 58,385 $ 98,232 $ (39,847 ) (41 )% Storage, shipping and handling $ 241,017 $ 73,531 $ 167,486 228 % Commissions $ 186,365 $ 144,688 $ 41,677 29 % Asset impairment expense $ 761,085 $ - $ 761,085 N/A 31 Advertising and marketing, and travel, expenses decreased for the year ended December 31, 2023, as compared to the corresponding period in 2022 as we focused our resources on our IPO in the current year.

Year Ended December 31, 2024 2023 Difference % Change Advertising and marketing $ 311,586 $ 162,048 $ 149,538 92 % Rent $ 240,213 $ 37,439 $ 202,774 542 % Travel $ 167,064 $ 58,385 $ 108,679 186 % Commissions $ 212,447 $ 186,365 $ 26,082 14 % Storage, shipping and handling $ 459,089 $ 241,017 $ 218,072 90 % Asset impairment expense $ - $ 761,085 $ (761,085 ) N/A Advertising and marketing expenses increased for the year ended December 31, 2024, as compared to the corresponding period in 2023, as we focused our resources on growing our sales.

An operating segment is defined as a component of an enterprise that engages in business activities from which it may earn revenues and expenses, and about which separate financial information is regularly evaluated by the chief operating decision maker in deciding how to allocate resources.

Actual results could differ from these estimates. Segment Reporting Under ASC 280, Segment Reporting , operating segments are defined as components of an enterprise where discrete financial information is available that is evaluated regularly by the chief operating decision maker (“CODM”), in deciding how to allocate resources and in assessing performance.

The Company’s customers are primarily located throughout the United States. Using our licensed technology platform, we believe our line of branded food products speak to current consumer trends. In our experience, conventional dehydration methods, such as freeze-drying and air drying, tend to degrade most fruit and vegetables through oxidation, browning/color degradation, nutritional content reduction and/or flavor loss.

In our experience, conventional dehydration methods, such as freeze-drying and air drying, tend to degrade most fruit and vegetables through oxidation, browning/color degradation, nutritional content reduction and/or flavor loss. As a result, certain highly sensitive fruits, such as avocados and bananas, have not previously been successfully offered as a dehydrated base for consumer products.

The manufacturing facility in Peru houses our new large-scale continuous through-put dehydration machine that completed its first production run in the first quarter of 2023, and which substantially increased our production capacity. Both facilities produce dehydrated fruit and vegetable products for BranchOut using a new proprietary dehydration technology licensed by us from a third party.

Years Ended December 31, Increase / 2023 2022 (Decrease) Net revenue $ 2,825,855 $ 752,178 $ 2,073,677 Cost of goods sold 2,922,085 922,728 1,999,357 Gross loss (96,230 ) (170,550 ) (74,320 ) Operating expenses: General and administrative 1,581,474 929,726 651,748 Salaries and benefits 1,129,858 628,637 501,221 Professional services 694,596 583,920 110,676 Depreciation and amortization - 93,253 (93,253 ) Total operating expenses 3,405,928 2,235,536 1,170,392 Operating loss (3,502,158 ) (2,406,086 ) (1,096,072 ) Other income (expense): Interest income 11,719 13,627 (1,908 ) Interest expense (435,271 ) (2,250,893 ) (1,815,622 ) Total other income (expense) (423,552 ) (2,237,266 ) (1,813,714 ) Net loss $ (3,925,710 ) $ (4,643,352 ) $ (717,642 ) Net Revenue Our net revenue for the year ended December 31, 2023 was $2,825,855, compared to $752,178 for the year ended December 31, 2022, an increase of $2,073,677, or 276%.

Years Ended December 31, Increase / 2024 2023 (Decrease) Net revenue $ 6,516,337 $ 2,825,855 $ 3,690,482 Cost of goods sold 5,652,717 2,922,085 2,730,632 Gross profit (loss) 863,620 (96,230 ) 959,850 Operating expenses: General and administrative 1,870,720 1,581,474 289,246 Salaries and benefits 1,604,200 1,129,858 474,342 Professional services 1,291,141 694,596 596,545 Total operating expenses 4,766,061 3,405,928 1,360,133 Operating loss (3,902,441 ) (3,502,158 ) 400,283 Other income (expense): Interest income 14,156 11,719 2,437 Interest expense (863,231 ) (435,271 ) 427,960 Total other income (expense) (849,075 ) (423,552 ) 425,523 Net loss $ (4,751,516 ) $ (3,925,710 ) $ 825,806 Net Revenue Our net revenue for the year ended December 31, 2024 was $6,516,337, compared to $2,825,855 for the year ended December 31, 2023, an increase of $3,690,482, or 131%.

Satisfaction of our Cash Obligations for the Next 12 Months As of December 31, 2023, we had incurred recurring losses from operations resulting in an accumulated deficit of $12,810,541, cash on hand of $657,789 and working capital of $899,150. We do not currently have sufficient funds to fund our operations at their current levels for the next twelve months.

We received aggregate net proceeds in this offering of $1,164,685 after deducting the underwriting discounts and commissions and offering expenses. Satisfaction of our Cash Obligations for the Next 12 Months As of December 31, 2024, we had incurred recurring losses from operations resulting in an accumulated deficit of $17,562,057, cash on hand of $2,329,452 and negative working capital of $3,897,382.

Our Products We plan to continue to grow revenues strategically by penetrating the multi-billion dollar grocery, industrial ingredient and online markets.

We believe that our licensed technology platform and process is the only way to produce quality avocado and banana-based snack and powdered products. Additionally, we believe our licensed technology platform produces superior products when using other fruits and vegetables when compared to conventional drying and dehydration technologies.

Our increased cash provided by financing activities was primarily from the net proceeds received in our IPO in the current period, as partially offset by debt repayments.

Our increased cash provided by financing activities was primarily from $7,071,898 of increased net proceeds received on debt and convertible debt financing, $206,183 of decreased deferred offering cost payments, and $5,489 of decreased principal payments on finance leases, as partially offset by $1,697,203 of decreased proceeds received on the sale of common stock.

December 31, December 31, 2023 2022 Current Assets $ 1,678,243 $ 1,077,973 Current Liabilities $ 779,093 $ 8,369,533 Working Capital $ 899,150 $ (7,291,560 ) As of December 31, 2023, we had working capital of $899,150.

December 31, December 31, 2024 2023 Current Assets $ 4,916,614 $ 1,678,243 Current Liabilities $ 8,813,996 $ 779,093 Working Capital $ (3,897,382 ) $ 899,150 As of December 31, 2024, we had negative working capital of $3,897,382. We have incurred net losses since our inception and we anticipate net losses and negative operating cash flows for the near future.

Removed

In addition, BranchOut has its own patent pending process, and has the nonexclusive rights to use the licensed technology platform for other products.

Added

Removed

The Company continues to develop its operations. In the event sales do not materialize at the expected rates, management would seek additional financing or would attempt to conserve cash by further reducing expenses. There can be no assurance that we will be successful in achieving these objectives.

Added

We recently completed the build out of the new facility, which commenced operations in December 2024, and utilizes three large-scale REV machines (a REV 60, REV 100 and REV 120) that we recently purchased from EnWave, as well as, a small REV 10 R&D machine that is being used for product development and customer sample purposes.

Removed

In addition, as a result of such dispute, we currently do not have access to the dehydration machine that was previously operated by this manufacturer. Although we have been able to continue to fulfill orders by shifting fulfillment to other manufacturing sources, our costs of goods are expected to increase as a result.

Added

We expect operating margins to be further improved in 2025, as we become more vertically integrated with the transition of more of our production from third party contract manufacturers to internal production. Using our licensed technology platform, we believe our lines of branded, private-label and industrial ingredient products positively address current consumer trends.

Removed

In addition, if we are unable to regain access to our dehydration machine and utilize it for the production of our products, our operating results may be materially and adversely affected.

Added

Subsequent to December 31, 2024, we received gross proceeds of approximately $2.4 million from sales of our common stock in an “At-the-Market” registered offering. Although we anticipate that our results of operations will improve substantially as a result of the recent launch of our new facility in Peru, there can be no assurance in that regard.

Removed

Reverse Stock Split On June 15, 2023, we effected a 2.5-for-1 reverse stock split of our outstanding shares of capital stock.

Added

As a result of such dispute, we had to fulfill orders by shifting fulfillment to other manufacturing sources until we commenced operations at our own fully integrated production facility in Peru in the fourth quarter of 2024.

Removed

Actual results could differ from these estimates. Segment Reporting ASC 280, Segment Reporting , requires annual and interim reporting for an enterprise’s operating segments and related disclosures about its products, services, geographic areas and major customers.

Added

On May 10, 2024 we entered into a ten-year lease for our 50,000 square-foot food processing plant located in Peru.

Removed

License Agreement In 2021, the Company entered into a license agreement to license the rights to certain production equipment developed and manufactured by another company through the purchase of that company’s equipment. The license is not discernable from the equipment; therefore, the license costs have been capitalized and depreciated over the useful life of the equipment.

Added

The lease of the Peru Facility requires us to make monthly lease payments of $8,000 in the first two years of the lease, $20,000 in the third year of the lease, $22,000 in the fourth year of the lease, $24,000 in the fourth year of the lease, and $25,000 thereafter.

Removed

Depreciation Expense Depreciation expense for the year ended December 31, 2023 was $-0-, compared to $93,253 for the year ended December 31, 2022, a decrease of $93,253.

Added

The lease also has a 10-year renewal option, and a buy-out option under which we may purchase the facility for $1,865,456.

Removed

The decrease was primarily due to depreciation associated with our EnWave 60kW Vacuum Microwave Dehydration and Chiller Machines, which were installed at our contract manufacturer in Peru in the third quarter of 2022, and commenced production activities on January 1, 2023, resulting in the recognition of depreciation as a component of cost of goods sold.

Added

In connection with our lease of the Peru Facility, we paid $275,000 on May 10, 2024 and another $80,000 during the fourth quarter of 2024, as part of the purchase of a first position mortgage receivable in the amount of $1,267,000, which is secured by the Peru Facility and was owed by the landlord of the Peru Facility to its former tenant.

Removed

Other expense decreased by $1,813,714, or 81%, primarily due to the decreased amortization of debt discounts and reductions in interest expense on debt which was mostly settled in June of 2023.

Added

The remaining $912,000 is due and payable in monthly installments of $152,000 through June 23, 2025, at which time an additional $55,604 of interest is due, based on a 9% financing rate.

Removed

The decreased net loss was primarily due to $74,320 of improved gross profits and a reduction of $1,815,622 of interest expense related to the amortization of debt discounts in the prior period that were not recognized in the current period and reductions in interest expense on debt which was mostly settled in June of 2023, as partially offset by $1,170,392 of increased operating expenses, including $761,085 of impairment expense.

Added

The par value of the common stock was not adjusted by the reverse stock split.

Removed

Liquidity and Capital Resources The following table summarizes our total current assets, liabilities and working capital as of December 31, 2023 and December 31, 2022.

Added

The Company has two components, consisting of its sales operations in the United States, and its production operations in Peru. Therefore, the Company’s Chief Executive Officer, who is also the CODM, makes decisions and manages the Company’s operations based on these two operating segments for the manufacture and distribution of its products.

… 32 more changes not shown on this page.

Other BOF 10-K year-over-year comparisons

BOF 10-K 2024 vs 2025