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What changed in Borealis Foods Inc.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of Borealis Foods 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.

+285 added−282 removedSource: 10-K (2025-04-15) vs 10-K (2024-04-15)

Top changes in Borealis Foods Inc.'s 2024 10-K

285 paragraphs added · 282 removed · 62 edited across 5 sections

Item 1. Business

Business — how the company describes what it does

48 edited+132 added−158 removed78 unchanged
Biggest changeHowever, if adequate funds are not available to us when we need them, we could go into default on our outstanding indebtedness, which would, in turn, permit our creditors to enforce remedies against us and cause us to consider reducing, discontinuing, or selling operations or seeking protection from creditors, and further raise substantial doubt about our ability to continue as a going concern.
Biggest changeHowever, if adequate funds are not available to us when we need them, we could be unable to fund our ongoing business, which, in turn, could cause our customers or suppliers to decrease the amount of business they do with us or terminate their relationship with us, or we could be unable to fund our ongoing business, which, in turn, could cause our customers or suppliers to decrease the amount of business they do with us or terminate their relationship with us, or we could go into default on our outstanding indebtedness, which, in turn, would permit our creditors to enforce remedies against us and cause us to consider reducing, discontinuing, or selling operations or seeking protection from creditors, and further raise substantial doubt about our ability to continue as a going concern.
In addition, we may experience substantial fluctuations in operating results in the future caused by various factors, including: ● general economic conditions; ● specific economic conditions in the food and agriculture industry; 12 ● the impact of inflation and rising interest rates across the economy, including higher food, grocery, raw materials, transportation, energy, labor and fuel costs; ● increases in the price of raw materials, labor, wages or other inputs that our suppliers use in manufacturing and supplying products, along with logistics, transportation, shipping and other related costs, may lead to higher production and shipping costs for our products.
In addition, we may experience substantial fluctuations in operating results in the future caused by various factors, including: 12 • general economic conditions; • specific economic conditions in the food and agriculture industry; • the impact of inflation and rising interest rates across the economy, including higher food, grocery, raw materials, transportation, energy, labor and fuel costs; • increases in the price of raw materials, labor, wages or other inputs that our suppliers use in manufacturing and supplying products, along with logistics, transportation, shipping and other related costs, may lead to higher production and shipping costs for our products.
We have not always been in the past and may be unable to in the future to anticipate or prevent techniques used to obtain unauthorized access to or compromise of our systems because they change frequently and are generally not detected until after an incident has occurred.
We have not always been in the past and may be unable in the future to anticipate or prevent techniques used to obtain unauthorized access to or compromise of our systems because they change frequently and are generally not detected until after an incident has occurred.
In addition to the uncertainty as to our ability to expand our international presence, there are certain risks inherent to doing business on an international level, such as unexpected changes in regulatory requirements, tariffs and other trade barriers, difficulties in staffing and managing foreign operations, longer payment cycles, problems in collecting accounts receivable, political instability, fluctuations in currency exchange rates, seasonal reductions in business activity during the summer months in Europe and certain other parts of the world and potentially adverse tax consequences, which could adversely impact the success of, our international operations.
In addition to the uncertainty as to our ability to expand our international presence, there are certain risks inherent to doing business on an international level, such as unexpected changes in regulatory requirements, tariffs and other trade barriers, difficulties in staffing and managing foreign operations, longer payment cycles, problems in collecting accounts receivable, political instability, fluctuations in currency exchange rates, seasonal reductions in business activity during the summer 21 months in Europe and certain other parts of the world and potentially adverse tax consequences, which could adversely impact the success of, our international operations.
In addition, our ability to manage normal commercial relationships with our suppliers, co-manufacturers, distributors, retailers, foodservice customers, consumers, and creditors may suffer. As global economic conditions and commodity pricing of raw materials used by us continue to be volatile or uncertain and recessionary or inflationary pressures exist, trends in consumer discretionary spending also remain unpredictable and subject to changes.
In addition, our ability to manage normal commercial relationships with our suppliers, co-manufacturers, distributors, retailers, foodservice customers, consumers, and creditors may suffer. As global economic conditions and commodity pricing of raw materials used by us continue to be volatile or uncertain and recessionary or inflationary pressures exist, trends in consumer discretionary spending 15 also remain unpredictable and subject to changes.
In addition, there can be no assurance that food products or technologies developed by others will not render our food products or technology uncompetitive or obsolete. Our business depends on our use of proprietary technology relying heavily on laws to protect.
In addition, there can be no assurance that food products or technologies developed by others will not render our food products or technology uncompetitive or obsolete. Our business depends on our use of proprietary technology relying heavily on laws to protect it.
The successful assertion of one or more large claims against us that exceed available insurance coverage, or the occurrence of changes in our insurance policies, including premium increases or the imposition of large deductible or co-insurance requirements, would harm our business.
The 20 successful assertion of one or more large claims against us that exceed available insurance coverage, or the occurrence of changes in our insurance policies, including premium increases or the imposition of large deductible or co-insurance requirements, would harm our business.
Additionally, if product demand decreases or we fail to forecast demand accurately, our results may be adversely impacted due to higher costs resulting from lower manufacturing utilization, causing higher fixed costs per unit produced.
If product demand decreases or we fail to forecast demand accurately, our results may be adversely impacted due to higher costs resulting from lower manufacturing utilization, causing higher fixed costs per unit produced.
We cannot be certain that it will be able to prevent vulnerabilities in our software or address vulnerabilities that we may become aware of in the future. In the past, we have experienced a cybersecurity-related incident.
We cannot be certain that we will be able to prevent vulnerabilities in our software or address vulnerabilities that we may become aware of in the future. In the past, we have experienced a cybersecurity-related incident.
At this time, we (i) do not have any direct business or contracts with any Russian or Ukraine entity as a supplier or customer, (ii) do not have any knowledge whether any of our customers or suppliers have any direct business or contracts with any Russian entity, (iii) do not believe that our business segments, products, lines of service, projects or operations are materially impacted by supply chain disruptions resulted from the war in Ukraine, and (iv) have not been materially financially affected by the war in Ukraine.
At this time, we (i) do not have any direct business or contracts with any Russian or Ukraine entity as a supplier or customer, (ii) do not have any knowledge whether any of our customers or suppliers have any direct business or contracts with any Russian entity, (iii) do not believe that our business segment, products, lines of service, projects or operations are materially impacted by supply chain disruptions resulted from the war in Ukraine, and (iv) have not been materially financially affected by the war in Ukraine.
Thus, we may be required to modify our marketing strategy, and our business, financial condition, and results of operations could be adversely affected. Changes in or the adoption of laws and regulations could have a material effect on us, our business, results of operations and financial condition. We are subject to multinational requirements beyond our control.
Thus, we may be required to modify our marketing strategy, and our business, financial condition, and results of operations could be adversely affected. Changes in or the adoption of laws and regulations could have a material effect on us, our business, financial condition, results of operations and cash flow. We are subject to multinational requirements beyond our control.
Any cybersecurity event, including any vulnerability in our software, cyberattack, intrusion, or disruption or any failure or breach unrelated to our own action or inaction, could result in significant increases in costs, including costs for remediating the effects of such an event; lost revenue due to network downtime, a decrease in customer and user trust; increases in insurance premiums due to cybersecurity incidents; increased exposure to a risk of litigation and possible liability; increased costs to address cybersecurity issues and attempts to prevent future incidents; and harm to our business, or financial results, and our reputation because of any such incident.
Any cybersecurity event, including any vulnerability in our software, cyberattack, intrusion, or disruption or any failure or breach unrelated to our own action or inaction, could result in significant increases in costs, including costs for remediating the effects of such an event; lost revenue due to network downtime, a decrease in customer and user trust; increases in insurance premiums due to cybersecurity incidents; increased exposure to a risk of litigation and possible liability; increased costs to address cybersecurity issues and attempts to prevent future incidents; and harm to our business, financial condition, results of operations and cash flow, and our reputation because of any such incident.
Our failure to comply with applicable laws and regulations or maintain permits and licenses relating to our operations could subject us to civil remedies, including fines, injunctions, recalls, or seizures, as well as potential criminal sanctions, which could result in increased operating costs resulting in a material adverse effect on our results of operations and financial condition.
Our failure to comply with applicable laws and regulations or maintain permits and licenses relating to our operations could subject us to civil remedies, including fines, injunctions, recalls, or seizures, as well as potential criminal sanctions, which could result in increased operating costs resulting in a material adverse effect on our business, financial condition, results of operations and cash flow.
Our registered public accounting firm has issued a report on our financial statements for the years ended December 31, 2023 and 2022, that includes an explanatory paragraph expressing substantial doubt in our ability to continue as a going concern. Our ability to continue as a going concern is dependent on our ability to obtain additional equity or debt financing.
Our registered public accounting firm has issued a report on our consolidated financial statements for the years ended December 31, 2024 and 2023, that includes an explanatory paragraph expressing substantial doubt in our ability to continue as a going concern. Our ability to continue as a going concern is dependent on our ability to obtain additional equity or debt financing.
Failure to continue to upgrade the operating and financial control systems or unexpected expansion difficulties could adversely affect our business, results of operations, and financial condition. We anticipate that our continued growth will require us to recruit and hire a substantial number of new managerial, agricultural and food processing, and sales and marketing personnel.
Failure to continue to upgrade our operating and financial control systems or unexpected expansion difficulties could adversely affect our business, financial condition, results of operations and cash flow. We anticipate that our continued growth will require us to recruit and hire a substantial number of new managerial, agricultural and food processing, and sales and marketing personnel.
For example, in 2023, our customer orders were not placed at the volume nor pace that was anticipated due to a number of factors that include, among others, the Ukraine conflict, increased transportation costs, warehouse availability at customer and retailer concerns about a potential shift in retail consumption patterns as the COVID-19 pandemic subsided, all of which negatively impacted our revenue growth.
For example, in 2024, our customer orders were not placed at the volume nor the pace that was anticipated due to a number of factors that include, among others, the increased transportation costs, warehouse availability at customer and retailer concerns about a potential shift in retail consumption patterns as the COVID-19 pandemic subsided, all of which negatively impacted our revenue growth.
Under this program the FDA regulates manufacturing practices for foods through its current good manufacturing practices (“ cGMPs ”) regulations and specifies the recipes for certain foods. Our processing facilities and products are subject to periodic inspection by federal, state, and local authorities.
Under this program the FDA regulates manufacturing practices for foods through its current good manufacturing practices (“cGMPs”) regulations and specifies the recipes for certain foods. Our processing facilities and products are subject to periodic inspection by federal, state, and local authorities.
Further, we may be required to recognize excess or obsolete inventory write-off charges, or excess capacity charges, which would have a material negative impact on our results of operations and financial position. We may experience volatility in costs for ingredients and packaging due to conditions that are difficult to predict. We purchase large quantities of food ingredients.
Further, we may be required to recognize excess or obsolete inventory write-off charges, or excess capacity charges, which would have a material negative impact on our business, financial condition, results of operations and cash flow. We may experience volatility in costs for ingredients and packaging due to conditions that are difficult to predict. We purchase large quantities of food ingredients.
Item 1.B. Unresolved Staff Comments. None. Item 1.C. Cybersecurity. Omitted.
Item 1.B. Unresolved Staff Comments None. Item 1.C. Cybersecurity None
We have a limited operating history, which makes it difficult to evaluate our business and prospects to forecast our future results. We were founded in 2019. Although we have experienced substantial revenue growth on an annual basis, we have incurred losses since inception. As of December 31, 2023, we had an approximate accumulated deficit of $65.82 million USD.
We have a limited operating history, which makes it difficult to evaluate our business and prospects to forecast our future results. We were founded in 2019. Although we have experienced substantial revenue growth on an annual basis, we have incurred losses since inception. As of December 31, 2024, we had an approximate accumulated deficit of $(90.8) million USD.
Our independent registered public accounting firm has expressed substantial doubt about our ability to continue as a going concern. Our historical financial statements have been prepared under the assumption that it will continue as a going concern.
Risks Related to Our Financial Condition Our independent registered public accounting firm has expressed substantial doubt about our ability to continue as a going concern . Our historical financial statements have been prepared under the assumption that we will continue as a going concern.
You should consider carefully the risks and uncertainties described below, together with all of the other information contained in this Annual Report. If any of the following events occur, our business, financial condition and operating results may be materially adversely affected.
Item 1.A. Risk Factors. You should consider carefully the risks and uncertainties described below, together with all of the other information contained in this Annual Report. If any of the following events occur, our business, financial condition, operating results and cash flow may be materially adversely affected.
If demand for our products experiences a prolonged decrease, we may be required to terminate or make penalty-type payments under certain supply chain arrangements, close or idle facilities and write down our long-lived assets or shorten the useful lives of underutilized assets and accelerate depreciation, which would increase expenses.
If demand for our products experiences a prolonged decrease, we may be required to terminate or make penalty-type payments under certain supply chain arrangements, close or idle facilities and write down our long-lived assets, which would increase expenses.
Many governments have enacted laws requiring companies to provide notice of data security incidents involving certain types of personal data. 19 We are subject to government regulation and industry policy risks that may change and cause us to no longer comply. Our operations are subject to extensive regulation by the U.S. Food and Drug Administration, the U.S.
Many governments have enacted laws requiring companies to provide notice of data security incidents involving certain types of personal data. Risks Related to Legal and Regulatory Matters We are subject to government regulation and industry policy risks that may change and cause us to no longer comply. Our operations are subject to extensive regulation by the FDA, the U.S.
There can be no assurance about which, if any, patents will issue from these applications, the breadth of any such patents, or whether any issued patents will be found invalid and unenforceable or will be threatened by third parties.
Our intellectual property consists principally of patents, trademarks, and trade secrets. 19 There can be no assurance about which, if any, patents will issue from these applications, the breadth of any such patents, or whether any issued patents will be found invalid and unenforceable or will be threatened by third parties.
If demand does not materialize at the rate forecasted, we may not be able to scale back our manufacturing expenses or overhead costs quickly enough to correspond to the lower than expected demand. Approximately 74% of our revenue was derived from three customers.
If demand does not materialize at the rate forecasted, we may not be able to scale back our manufacturing expenses or overhead costs quickly enough to correspond to the lower than expected demand.
Even a meaningful change in a customers’ inventory strategy could impact the industries demand and growth for any our product. If these customers were to reduce their purchases, we would lose a material amount or most of our current revenue. This would result in lower margins and materially adversely impact our business, results of operations, cash flows, and financial position.
Even a meaningful change in a customers’ inventory strategy could impact the industries demand and growth for any our product. If these customers were to reduce their purchases, we would lose a material amount or most of our current revenue.
The extent and duration of the military action, sanctions, and resulting market disruptions are impossible to predict, but could be substantial. Any such disruptions caused by Russian military action or resulting sanctions may magnify the impact of other risks described in this section.
The extent and duration of the military action, sanctions, and resulting market disruptions are impossible to predict, but could be substantial. Any such disruptions caused by Russian military action or resulting sanctions may magnify the impact of other risks described in this section. We run the risk of crop failures largely dependent on factors outside of our control.
However, these legal means afford only limited protection and may not adequately protect our proprietary technology or permit us to gain or keep a competitive advantage. Our intellectual property consists principally of patents, trademarks, and trade secrets.
However, these legal means afford only limited protection and may not adequately protect our proprietary technology or permit us to gain or keep a competitive advantage.
Prolonged unfavorable economic conditions or uncertainty would be expected to have an adverse effect on our sales and profitability, which could be material, and may result in consumers making long-lasting changes to their discretionary spending behavior on a more permanent basis. 16 The loss of key personnel, or failure to attract and retain other highly qualified personnel in the future, could harm our business.
Prolonged unfavorable economic conditions or uncertainty would be expected to have an adverse effect on our sales and profitability, which could be material, and may result in consumers making long-lasting changes to their discretionary spending behavior on a more permanent basis.
We have from time-to-time experienced significant delays in the receipt of certain of these ingredients. For example, we have a preferred provider that we rely on for our pea protein, which is an ingredient in our ramen products. In the event of a disruption with our preferred provider, we would source our pea protein from one of our other providers.
For example, Puris Foods is our preferred supplier of the pea protein used for our ramen products. We have from time-to-time experienced significant delays in the receipt of certain of our ingredients. In the event of a disruption or other business issue with our preferred provider, we would source our pea protein from one of our other providers.
Many of these companies possess financial resources significantly greater than those of ours, and accordingly, could initiate and support prolonged price competition to gain market share. In particular, the large food and agriculture companies could significantly undercut our pricing for our products.
Currently, the leading providers of food and agriculture products include large food and agriculture companies, as well as a number of smaller companies. Many of these companies possess financial resources significantly greater than those of ours, and accordingly, could initiate and support prolonged price competition to gain market share.
Additional risks and uncertainties that we are unaware of, or that we currently believe are not material, may also become important factors that adversely affect our business or results of operations . Risks Related to Our Business We have a limited operating history which makes it difficult to evaluate our business and prospects.
Additional risks and uncertainties that we are unaware of, or that we currently believe are not material, may also become important factors that adversely affect our business or results of operations .
If supplies of quality ingredients are reduced or there is greater demand for such ingredients from us and others, we may not be able to obtain sufficient supply that meets our strict quality standards on favorable terms, or at all, which could materially adversely impact our ability to supply products and may materially adversely affect our business, results of operations, and financial condition. 15 Adverse climate conditions may have an adverse effect on our business.
We also compete with other food producers in the procurement of ingredients, and this competition may increase in the future if consumer reduced or there is greater demand for such ingredients from us and others, we may not be able to obtain sufficient supply that meets our strict quality standards on favorable terms, or at all, which could materially adversely impact our ability to supply products and may materially adversely affect our business, financial condition, results of operations, and cash flow.
We cannot predict future changes in the interpretation of patent laws by judicial bodies or changes to patent laws that might be enacted into law by legislative bodies. 18 Any cybersecurity-related attack, significant data breach, or disruption of the information technology systems, infrastructure, network, third-party processors, or platforms on which we rely could damage our reputation and materially adversely affect our business, and financial results.
Any cybersecurity-related attack, significant data breach, or disruption of the information technology systems, infrastructure, network, third-party processors, or platforms on which we rely could damage our reputation and materially adversely affect our business, and financial results.
If significant price competition were to develop, we likely would be forced to lower our prices, possibly for a protracted period, which would have a material adverse effect on our financial results and could threaten our economic viability. In addition, many of these large competitors possess marketing, agricultural and food processing resources greater than those of ours.
If significant price competition were to develop, we likely would be forced to lower our prices, possibly for a protracted period, which would have a material adverse effect on our business, financial condition, results of operations and cash flow and could threaten our economic viability.
If we are unable to respond on a timely and appropriate basis to changes in demand or consumer preferences and trends, our sales volumes and margins could be materially adversely affected. 14 We will need to grow the size of our organization, and we may experience difficulties in managing this growth. We are currently experiencing rapid growth and expansion.
If we are unable to respond on a timely and appropriate basis to changes in demand or consumer preferences and trends, our sales volumes and margins could be materially adversely affected.
The doubt regarding our potential ability to continue as a going concern may adversely affect our ability to obtain new financing on reasonable terms or at all.
The substantial doubt regarding our ability to continue as a going concern may adversely affect our ability to obtain new financing on reasonable terms or at all. Additionally, if we are unable to continue as a going concern, our shareholders may lose some or all of their investment in our Company.
Our success depends to a significant degree upon the continued contributions of our senior operating management, including our co-founders, Reza Soltanzadeh, Chief Executive Officer, and Barthelemy Helg, Non-Executive Chairman of the Board. The loss of the services of Mr. Soltanzadeh or Mr. Helg could have a material adverse effect on our business, results of operations, and financial condition.
The loss of key personnel, or failure to attract and retain other highly qualified personnel in the future, could harm our business. Our success depends to a significant degree upon the continued contributions of our senior operating management, including our co-founders, Reza Soltanzadeh, Chief Executive Officer, and Barthelemy Helg, non-executive Chairman of the Board.
A significant portion of our revenue is concentrated with a limited number of customers. Approximately 74% of our total revenue was derived from three customers. A disruption in our relationship with any one of these customers could materially adversely affect our business, results of operations, cash flows, and financial position.
Approximately 33% of our total revenue in 2024 was derived from two customers. A disruption or deterioration in or other business issue our relationship with any one or more of these customers could materially adversely affect our business, financial condition, results of operations and cash flow.
In the event that we are unable to obtain such additional capital, we may be required to reduce the scope of our presently anticipated expansion. Our inability to achieve projected growth could have a material adverse effect on our results of operations and could adversely impact our ability to compete.
In the event that we are unable to obtain such additional capital, we may be required to reduce the scope of our presently anticipated expansion.
If we are not successful in managing our ingredient and packaging costs, if we are unable to increase our prices to cover increased costs or if such price increases reduce our sales volumes, then such increases in costs may materially adversely affect our business, results of operations and financial condition. 17 Our future success will depend, in part, on our ability to maintain our technological leadership, enhance our current food products, develop new food products that meet changing customer needs and preferences, advertise and market our food products, and influence and respond to emerging industry standards and other technological changes on a timely and cost-effective basis.
Our future success will depend, in part, on our ability to maintain our technological leadership, enhance our current food products, develop new food products that meet changing customer needs and preferences, advertise and market our food products, and influence and respond to emerging industry standards and other technological changes on a timely and cost-effective basis.
We may not continue to grow or maintain our active customer base, may not be able to achieve or maintain profitability, and may not be aligned with customer trends and preferences. There are a number of trends in consumer preferences which have an impact on us and the food industry as a whole.
There are a number of trends in consumer preferences which have an impact on us and the food industry as a whole.
Smaller competitors, although often faced with financial barriers, typically compete on the basis of their ability to create niche markets by rapidly introducing products of interest to local customers and then expanding. The resulting price pressure and niche loyalties present substantial competitive challenges for us. A significant portion of our revenue is concentrated with a limited number of customers.
The resulting price pressure and niche loyalties could present substantial competitive challenges for us. A significant portion of our revenue is concentrated with a limited number of customers.
Our success and future growth also will depend on our ability to attract and retain qualified management, manufacturing, technical and sales and marketing personnel. Competition for such personnel in the industry is intense. There can be no assurance that we will be successful in attracting and retaining such personnel.
Competition for such personnel in the industry is intense. There can be no assurance that we will be successful in attracting and retaining such personnel. Our management team has limited experience managing a public company.
There can be no assurance that such factors will not have a material adverse effect on our future international operations and, consequently, on our business, results of operations and financial condition. 20 Shareholders may experience dilution of their ownership interests if we issue additional capital stock or make investments.
There can be no assurance that such factors will not have a material adverse effect on our future international operations and, consequently, on our business, financial condition, results of operations and cash flow. Climate change, and related legislative and regulatory responses to climate change, may materially adversely impact our business.
The food and agriculture business is highly competitive, and faces increased competition as a result of consolidation, channel proliferation, and the growth of online food retailers and new market participants. Currently, the leading providers of food and agriculture products include large food and agriculture companies, as well as a number of smaller companies.
We face market competition, and if we are unable to compete effectively with our competitors, our business and operating results could be materially adversely affected. The food and agriculture business is highly competitive, and faces increased competition as a result of consolidation, channel proliferation, and the growth of online food retailers and new market participants.
Prolonged unrest, intensified military activities, or more extensive sanctions impacting the region could have a material adverse effect on the global economy, and such effect could in turn have a material adverse effect on our business, financial condition, results of operations, and prospects.
Any one or more of such events would have a material adverse effect on our business, financial condition, results of operations and cash flow.
Removed
Item 1. Business. Overview The following discussion reflects the business of Borealis Foods, as currently embodied by Borealis Foods . Borealis Foods is a food technology company that has developed high-quality, affordable, sustainable, and nutritious ready-to-eat meals. We are a mission-driven company committed to utilizing our products to help solve the national and global food security and nutrition challenges.
Added
SUMMARY OF RISK FACTORS The following is a summary of some of the risks and uncertainties as of the date of the filing of this Annual Report on Form 10-K that could materially adversely affect our business, financial condition, results of operations and cash flow.
Removed
Our commitment to nutrition, affordability, and sustainability reflects our goal of positively impacting both human life and the planet. Food and nutritional insecurity impact an estimated 821 million people across the globe, according to the World Health Organization. Food production accounts for approximately 30% of the world’s energy consumption and 22% of global greenhouse gas emissions.
Added
You should read this summary together with the more detailed description of each risk factor contained below in the section titled “Risk Factors.” Risks Related to Our Financial Condition • Our independent registered public accounting firm has expressed substantial doubt about our ability to continue as a going concern; • Our potential insolvency or inability to pay our debt would have a material adverse effect on our business, financial condition, results of operations and cash flow; • We will require substantial capital investment in the future, and our inability to raise adequate capital could affect our ability to continue as a going concern; • Restrictive covenants in the agreements governing our Credit Facility may restrict our future operations, including our ability to pursue our business strategies or respond to changes; • Our financial results and future growth have been, and could in the future be, harmed by currency exchange rate fluctuations; • Insolvency, credit problems or other financial difficulties that could confront our retail partners could expose us to financial risk; Risks Related to Our Business • We have a limited operating history which makes it difficult to evaluate our business and prospects; • The loss of key personnel, or failure to attract and retain other highly qualified personnel in the future, could harm our business; • Our management team has limited experience managing a public company; • We will incur significant increased costs as a result of operating as a public company, and our management will be required to devote substantial time to new compliance initiatives; • Our dependence on suppliers may materially adversely affect our operating results and financial position; • Manufacturing and production forecasts are based on multiple assumptions.
Removed
Feeding the world’s population a healthy diet within the earth’s boundaries requires an urgent transition to a sustainable model. While the scale of the challenge is undeniably significant, we believe our innovative technology not only offers a pathway to a more sustainable future, but a potential tool in the fight against global malnutrition.
Added
We must adequately estimate our manufacturing capacity and inventory supply. If we overestimate our demand and overbuilds our capacity or inventory, we may have significantly underutilized assets.
Removed
Borealis Foods has developed the first complete protein dough containing all nine essential amino acids. It entered the market with ready-to-eat meals, featuring 20 grams of complete plant-based protein per serving, distributed through both retail and foodservice channels. The Company also developed first of its kind ambient ready-to-eat high-protein meals for U.S. and global humanitarian food programs.
Added
Underutilization of our manufacturing facilities can adversely affect our gross margin and other operating results; • We may experience volatility in costs for ingredients and packaging due to conditions that are difficult to predict; • Our future success will depend, in part, on our ability to maintain our technological leadership, enhance our current food products, develop new food products that meet changing customer needs and preferences, advertise and market our food products, and influence and respond to emerging industry standards and other technological changes on a timely and cost-effective basis; • Adverse climate conditions may have an adverse effect on our business.
Removed
Borealis Foods’ innovative model and products have allowed it to appeal to a broad range of consumers, positioning it to compete directly in the global ramen market, which was estimated $54.6 billion global market in 2022 according to the Instant Noodles Global Market Report 2023.
Added
We may take various actions to mitigate our business risks associated with climate change, which may require us to incur substantial costs and may not be successful, due to, among other things, the uncertainty associated with the longer-term projections associated with managing climate risks; 9 • The spread of contagious diseases, natural disasters, severe weather, actual or threatened hostilities or war, terrorist activity, political unrest, civil strife, and other geopolitical uncertainty may cause global economic disruption, and its impact on our business is uncertain; • The loss of key personnel, or failure to attract and retain other highly qualified personnel in the future, could harm our business; • Consumer spending habits, including discretionary spending on food products such as ours, are affected by many factors; • We face market competition, and if we are unable to compete effectively with our competitors, our business and operating results could be materially adversely affected; • A significant portion of our revenue is concentrated with a limited number of customers.
Removed
The Company’s strategy includes partnering with Non-Governmental Organizations (“ NGOs ”), government programs, and food service providers to offer these and other products to institutional clients such as schools and other organizations that help feed those with insufficient access to nutritious meals. The Company’s innovative technology was used in the development of its first vertical, ramen noodles.
Added
The loss of or deterioration or disruption in our relationship with one or more of our customers could have a material adverse effect on our business, financial condition, result of operations and cash flow; • We may not continue to grow or maintain our active customer base, may not be able to achieve or maintain profitability, and may not be aligned with customer trends and preferences; • If we fail to maintain adequate operational and financial resources, particularly if we continue to grow rapidly, we may be unable to execute our business plan or maintain our competitive position and high-level customer satisfaction; • We will need to grow the size of our organization, and we may experience difficulties in managing this growth; • The war in Ukraine, and the sanctions in place, could adversely affect global energy and financial markets thus potentially affecting our business and customers; • We run the risk of crop failures largely dependent on factors outside of our control; • Our business is subject to an increasing focus on environmental and social impact matters; • Changes in commodity costs and other operating costs could materially adversely affect our results of operations; • Unfavorable general economic conditions could adversely affect our business and financial results; Risks Related to Technology and Intellectual Property • Our future success will depend, in part, on our ability to maintain our technological leadership, enhance our current food products, develop new food products that meet changing customer needs and preferences; • Our business depends on the use of proprietary technology relying heavily on laws to protect it; • Inadequate technical and legal intellectual property (IP) protections could prevent us from defending or securing our proprietary technology and IP; • Any cybersecurity-related attack, significant data breach, or disruption of the information technology systems, infrastructure, network, third-party processors, or platforms on which we rely could damage our reputation and materially adversely affect our business, and financial results.
Removed
Lovingly made in the U.S., Chef Woo and Ramen Express branded ramen noodles are produced and packaged by the Company’s wholly-owned technologically advanced manufacturing company, Palmetto Gourmet Foods, or “ PGF ”. Nestled in scenic Saluda, South Carolina, the factory is one of the largest and most advanced ramen noodle producers in North America.
Added
Risks Related to Legal and Regulatory Matters • We are subject to government regulation and industry policy risks that may change and cause us to no longer comply; • We may be subject to changes in laws or regulations that can change on any given day; • We are subject to multinational requirements beyond our control; • Climate change, and related legislative and regulatory responses to climate change, may materially adversely impact our business; Risks Related to Ownership of Our Securities • Raising additional capital may cause dilution to our Shareholders, restrict our operations or require us to relinquish rights to our technologies or product candidates; • If we fail to maintain an effective system of internal control over financial reporting, we may not be able to accurately report our financial results or prevent fraud.
Removed
With a widespread presence, Borealis Foods’ products are currently available in over approximately 22,000 points of distribution primarily in the U.S., Canada, Mexico, and Europe.
Added
As a result, shareholders could lose confidence in our financial and other public reporting, which would harm our business and the trading price of our common shares; • Our Articles, together with our By-laws, and Canadian laws and regulations applicable to us may adversely affect our ability to take actions that could be deemed beneficial to our shareholders; • U.S. shareholders may not be able to obtain judgments or enforce civil liabilities against us or our executive officers or our board of directors; • The price of our Common Shares may be volatile, and you could lose all or part of your investment; • We may issue additional shares or other equity securities without your approval, which would dilute your ownership interest in us and may depress the market price of your shares; 10 General Risk Factors • The global scope of our business subjects us to risks that could negatively affect our business; • Unfavorable general economic conditions could adversely affect our business, financial condition, results of operation and cash flow; • As current tariffs are implemented, or if additional or increased tariffs or other restrictions are placed on foreign imports or any related counter-measures are taken by other countries, our business and results of operations could be harmed; and • Economic recessions or downturns could impair our company and harm our operating results.
Removed
The products can be found across several channels of mass merchandisers (Walmart), club stores (Costco and Sam’s Club), limited assortments retailers (Aldi and Save-a-lot), traditional supermarkets (Albertson, Winn-Dixie, and Save Mart), regional retailer channels, and e-commerce distributors (Amazon and Walmart.com). Research, development, and innovation are core elements of our business strategy, which we see as a critical competitive advantage.
Added
Our potential insolvency, inability to pay our debt or bankruptcy would have a material adverse effect on our business, financial condition, results of operations, cash flow, cash available for distribution as well as our ability to service our debt obligations, and could result in our inability to continue as a going concern.
Removed
Through continuous R&D and partnerships with other advanced food-tech companies, our team focuses on making continuous improvements to our existing technology and product formulations, in addition to developing new products across our platform.
Added
If we were to default on our debt obligations, it would likely cause a significant or complete reduction in the operating cash flow generated by our product sales. There can be no assurance that we would be able to avoid insolvency, make timely payments on our debt or payments to our suppliers.
Removed
We intend to continue to invest in innovation, supply chain capabilities, manufacturing, and marketing initiatives, as we believe the demand for our products will continue to accelerate across retail and e-commerce channels.
Added
If we were to default, we may incur substantial costs, that could have a severe adverse effect on our business, financial condition, results of operations and cash flow, and we might take actions to respond to any default including the curtailment or reduction in operations, the sale of assets or the Company, or seeking protection from creditors under bankruptcy or insolvency laws.
Removed
In addition, we plan to develop additional channels for our products through NGOs, government programs, and food services. 1 The Borealis Foods Strategic Difference Unique Approach to the Product We developed and launched the first plant-based instant ramen meals providing 20 grams of complete protein per serving.
Added
We will require substantial capital investment in the future, and our inability to raise adequate capital could affect our ability to continue as a going concern. We will require significant funding to continue our operations and advance our business plan.
Removed
We believe our unique approach to making ready-made ramen makes us a disruptor in one of the most widely consumed food categories. Our Chef Woo ramen serves as a complete source of protein because it includes all nine essential amino acids and provides over one-third of a person’s daily recommended protein in one serving.
Added
Our ability to raise additional capital, on timely and favorable terms or at all, will depend on various factors, including macroeconomic conditions and market conditions as well as our liquidity, financial condition and results of operations. If these factors deteriorate, our ability to raise capital to fund ongoing operations, capital needs and business activities could be significantly negatively impacted.
Removed
Complete proteins are essential to a healthy diet. They contribute to muscle growth, repair, and maintenance and also play a role in bolstering the immune system, aiding in the production of antibodies and enzymes that defend against infections and promote faster healing. Complete proteins are also involved in hormone production, helping to regulate various bodily functions, including metabolism and mood.
Added
If we cannot obtain adequate additional financing, among other things, we may have to substantially curtail or limit our production activities, sell assets or the Company or seek protection from creditors under bankruptcy laws, which could materially and adversely affect our business plan. Inadequate financial resources could also raise substantial doubt about our ability to continue as a going concern.
Removed
Our commitment to providing higher protein content in our ramen sets us apart from the other instant noodle cups on the market. Additionally, we use a protein source that is free of anti-digestive factors that hinder protein digestibility, further enhancing the bioavailability of the protein.
Added
Restrictive covenants in the agreements governing our Credit Facility may restrict our future operations, including our ability to pursue our business strategies or respond to changes.
Removed
Plant-based protein is a highly convenient and cost-effective source of protein which is hard to match from a cost perspective when compared to other sources of protein.
Added
The agreement governing our Credit Facility contains a number of restrictive covenants that impose significant operating and financial restrictions on us and may limit our ability to engage in acts that may be in our long-term best interests.

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Item 2. Properties

Properties — owned and leased real estate

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Biggest changeOur principal office is located at 1540 Cornwall Rd., Suite 104, Oakville, Ontario L6J7W5, Canada.
Biggest changeOur principal office is located at 1540 Cornwall Rd., Suite 104, Oakville, Ontario L6J7W5, Canada. Our manufacturing facility is located at 4160 Columbia Hwy., Saluda, South Carolina 29138, USA. Our distribution center is located at 313 Greenwood Hwy., Saluda, South Carolina 29138, USA.
We believe our current facility is adequate to meet ongoing demand and is capable of hosting additional production lines to support our future ramp-up. In addition, we are in the process of obtaining permits to convert to solar power in hopes of becoming Scope two carbon neutral.
We believe our current facility is adequate to meet ongoing demand and is capable of hosting additional production lines to support our 25 currently anticipated future ramp-up. In addition, we are in the process of obtaining permits to convert to solar power with the objective of becoming Scope two carbon neutral.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeIn addition, from time to time, we may receive letters or other forms of communication asserting claims against us. Item 4. Mine Safety Disclosures. Not Applicable. 21 Part II
Biggest changeIn addition, from time to time, we may receive letters or other forms of communication asserting claims against us.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

5 edited+2 added−2 removed2 unchanged
Biggest changeHolders As of March 22, 2024, there were 79 holders of record of our Common Shares and four holders of record of our Warrants. Dividend Policy We have no current plans to pay dividends on our Common Shares.
Biggest changeHolders As of April 15, 2025, there were 34 holders of record of our Common Shares and four holders of record of our Warrants based on information furnished by Continental Stock Transfer & Trust Company, the transfer agent for our securities. Dividend Policy We have no current plans to pay dividends on our Common Shares.
The aggregate number of Common Shares that is (i) issued to an officer, director, 10% stockholder and anyone who possesses material non-public information because of his or her relationship with the company or with an officer, director or principal stockholder of the company (“ Insiders ”) under the Incentive Plan or any other proposed or established share compensation arrangement within any one-year period will not exceed 10% of the total issued and outstanding Common Shares subject to the Incentive Plan from time to time and (ii) issuable to a non-employee director under the Incentive Plan during any fiscal year of we may not have a “fair value” as of the date of grant, as determined in accordance with ASC Topic 718 (or any other applicable accounting guidance), that exceeds $300,000 in the aggregate.
The aggregate number of Common Shares that is (i) issued to an officer, director, 10% stockholder and anyone who possesses material non-public information because of his or her relationship with the company or with an officer, director or principal stockholder of the company (“ Insiders ”) under the Incentive Plan or any other proposed or established share compensation arrangement within any one- 26 year period will not exceed 10% of the total issued and outstanding Common Shares subject to the Incentive Plan from time to time and (ii) issuable to a non-employee director under the Incentive Plan during any fiscal year of we may not have a “fair value” as of the date of grant, as determined in accordance with ASC Topic 718 (or any other applicable accounting guidance), that exceeds $300,000 in the aggregate.
Our Board may take into account general and economic conditions, our financial condition and operating results, our available cash and current and anticipated cash needs, capital requirements, contractual, legal, tax, and regulatory restrictions and implications on the payment of dividends by us to our stockholders or by our subsidiaries to us, and such other factors as our Board may deem relevant.
Our Board may take into account general and economic conditions, our business, financial condition, operating results, our available cash and current and anticipated cash needs, capital requirements, contractual, legal, tax, and regulatory restrictions and implications on the payment of dividends by us to our stockholders or by our subsidiaries to us, and such other factors as our Board may deem relevant.
Holders of our Common Shares do not have any right to receive dividends, or to receive a distribution upon a liquidation, dissolution, or winding up of Borealis Foods Inc., with respect to their Common Shares.
Holders of our Common Shares do not have any right to receive dividends, or to receive a distribution upon a liquidation, dissolution, or winding up of Borealis Foods, with respect to their Common Shares.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities. Market Information Our Common Shares began trading on the Nasdaq under the symbol “BRLS” on February 8, 2024. Our Warrants began trading on the Nasdaq under the symbol “BRLSW” on the same day.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities. Market Information Our Common Shares are traded on the Nasdaq under the symbol “BRLS” and our Warrants are traded on the Nasdaq under the symbol “BRLSW”.
Removed
Securities Authorized for Issuance Under Equity Compensation Plans As of December 31, 2023, we did not have any equity compensation plans and, further, we did not have any securities authorized for issuance under equity compensation plans. On February 7, 2024, in connection with the Transaction, Oxus’ and Borealis’ shareholders approved the Equity Incentive Plan (the “ Incentive Plan ”).
Added
Securities Authorized for Issuance Under Equity Compensation Plans On September 3, 2024, we filed a Form S-8 for offers of Common Shares, issued to qualified officers, employees, non-employee directors and consultants, under Borealis Foods’ Equity Incentive Plan (the “ Incentive Plan ”). The Incentive Plan initially makes available a maximum number of 1,125,869 Common Shares.
Removed
The Incentive Plan initially makes available a maximum number of 1,125,869 Common Shares.
Added
Issuer Purchases of Equity Securities Not Applicable. Recent Sales of Unregistered Securities Not Applicable. Item 6. [Reserved]

Item 7. Management's Discussion & Analysis

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

6 edited+89 added−60 removed1 unchanged
Biggest changePursuant to the Business Combination Agreement, among other things: (a) Oxus will domesticate and continue as a corporation existing under the laws of the Province of Ontario, Canada (the “ Continuance ” and, New Oxus); (b) on the closing date, Newco and Legacy Borealis will amalgamate in accordance with the terms of the Legacy Borealis Amalgamation, with Amalco surviving the Legacy Borealis Amalgamation as a wholly-owned subsidiary of New Oxus; and (c) on the closing date, immediately following the Borealis Amalgamation, Amalco and New Oxus will amalgamate in accordance with the terms of the Borealis Amalgamation, with Borealis Foods surviving the Borealis Amalgamation.
Biggest changePursuant to the terms of the Business Combination Agreement, among other things: (i) Oxus domesticated and continued as a corporation under the laws of Ontario, Canada (“ New Oxus ”); and (ii) pursuant to the Plan of Arrangement, (a) Newco and Legacy Borealis amalgamated (the “ Legacy Borealis Amalgamation ”, and the amalgamated corporation resulting therefrom, “ Amalco ”), with Amalco surviving the Legacy Borealis Amalgamation as a wholly-owned subsidiary of New Oxus; and (b) following the Legacy Borealis Amalgamation, New Oxus and Amalco amalgamated (the “ Borealis Amalgamation ,” and together with the Legacy Borealis Amalgamation, the “Amalgamations,” and the corporation resulting therefrom.
Critical Accounting Estimates The preparation of financial statements in conformity with GAAP requires the Company’s management to make estimates and assumptions that 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 expenses during the reporting period.
GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenue and expense during the reporting periods.
There can be no assurance that such additional financing will be available to Borealis Foods on terms acceptable to Borealis Foods or at all.
We are actively exploring additional financing options to strengthen liquidity; however, there can be no assurance that such funding will be available on favorable terms or at all.
Certain information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties.
The following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction with the financial statements and the notes thereto contained elsewhere in this Annual Report. Certain information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties.
Unless otherwise indicated, references to the “Company,” “our,” “us” or “we” in this Item 7 refer to Oxus Acquisition Corp., or Oxus, before the consummation of the Transaction. References to our “management” or our “management team” refer to our officers and directors, and references to the “sponsor” refer to Oxus Capital Pte. Ltd.
"Borealis," as a corporation amalgamated under the Business Corporations Act (Ontario)), with Borealis surviving the Borealis Amalgamation. Borealis continues under the name “ Borealis Foods Inc. ”. Unless otherwise indicated, references to the “Company,” “our,” “us” or “we” in this Item 7 refer to Oxus Acquisition Corp., or Oxus, before the consummation of the Transaction.
We intend to effectuate our initial Business Combination using cash from the proceeds of our IPO and the sale of the private warrants (the “ Private Warrants ”), our shares, debt or a combination of cash, equity, and debt. The Business Combination Agreement On February 23, 2023, we entered into a Business Combination Agreement with Newco and Legacy Borealis.
The Reverse Recapitalization On February 23, 2023, Borealis Foods Inc., a corporation incorporated under the laws of Canada (“ Legacy Borealis ”), entered into a Business Combination Agreement (as amended, amended and restated, supplemented, or otherwise modified from time to time, the " Business Combination Agreement ") with Oxus Acquisition Corp.
Removed
The term “New Borealis” refers to Borealis Foods Inc. after the consummation of the Business Combination. The following discussion and analysis of the Company’s financial condition and results of operations should be read in conjunction with the financial statements and the notes thereto contained elsewhere in this Annual Report.
Added
Our actual results may differ materially from those anticipated in these forward-looking statements as a result of various factors, including, those set forth under Item 1.A., "Risk Factors," included in Part I of this Annual Report on Form 10-K. The preparation of the consolidated financial statements in conformity with U.S.
Removed
Overview We are a blank check company incorporated in the Cayman Islands on February 3, 2021 for the purpose of entering into a merger, share exchange, asset acquisition, share purchase, reorganization or similar Business Combination with one or more businesses (a “ Business Combination ”).
Added
Management has not applied any critical accounting estimates but has identified certain accounting policies as critical to understanding the financial condition and results of operations. For a detailed discussion on the application of these and other accounting policies, see the notes to the consolidated financial statements included in this Annual Report on Form 10-K.
Removed
The Business Combination Agreement was unanimously approved by Oxus’ and Legacy Borealis’ respective board of directors.
Added
Our historical financial statements have been prepared under the assumption that we will continue as a going concern. Our registered public accounting firm has issued a report on our consolidated financial statements for the years ended December 31, 2024 and 2023, that includes an explanatory paragraph expressing substantial doubt in our ability to continue as a going concern.
Removed
Borealis Foods will continue under the name “Borealis Foods Inc.”. For a more detailed discussion of the Business Combination Agreement, the Transaction, and the ancillary agreements, see the Current Report on Form 8-K filed with the SEC on March 1, 2023.
Added
Our ability to continue as a going concern is dependent on our ability to obtain additional equity or debt financing. Our financial statements do not include any adjustments that might result from the outcome of this uncertainty.
Removed
Extension At the extraordinary general meeting held on March 2, 2023 (the “ Extraordinary General Meeting ”), our shareholders approved (1) a special resolution (the “ Extension Proposal ”) to amend our Amended and Restated Memorandum and Articles of Association, as amended (the “ Oxus Charter ”) to extend the date that we have to consummate a business combination from March 8, 2023 to December 8, 2023, or such earlier date as determined by our board of directors (and (2) a special resolution (the “ Founder Share Amendment Proposal ”) to amend the Oxus Charter to provide for the right of a holder of the Class B ordinary shares to convert into the Class A ordinary shares on a one-for-one basis prior to the closing of a business combination at the election of such holder.
Added
However, if adequate funds are not available to us when we need them, we could be unable to fund our ongoing business, which, in turn, could cause our customers or suppliers to decrease the amount of business they do with us or terminate their relationship with us, or we could be unable to fund our ongoing business, which, in turn, could cause our customers or suppliers to decrease the amount of business they do with us or terminate their relationship with us, or we could go into default on our outstanding indebtedness, which, in turn, would permit our creditors to enforce remedies against us and cause us to consider reducing, discontinuing, or selling operations or seeking protection from creditors.
Removed
On December 5, 2023, in connection with the Second Extraordinary General Meeting, the Company filed the Oxus Charter Amendment to extend the date by which the Company must consummate its initial business combination from December 8, 2023 to June 8, 2024, or such earlier date as determined by the Company’s board of directors (the “ Extended Date ”).
Added
The substantial doubt regarding our potential ability to continue as a going concern may adversely affect our ability to obtain new financing on reasonable terms or at all. Additionally, if we are unable to continue as a going concern, our shareholders may lose some or all of their investment in our Company.
Removed
In connection with the votes to approve the Extension Proposal and the Founder Share Amendment Proposal, the holders of 15,300,532 Class A ordinary shares of the Company properly exercised their right to redeem their shares for cash at a redemption price of approximately $10.41 per share, for an aggregate redemption amount of approximately $159.34 million, leaving approximately $20.3 million in the Trust Account.
Added
Any one or more of such events would have a material adverse effect on our business, financial condition, results of operations and cash flow. Overview Borealis Foods is a pioneering, integrated food science and manufacturing company that is redefining affordable nutrition.
Removed
On December 5, 2023, at the Second Extraordinary General Meeting, the holders of 9,837 Class A ordinary shares of the Company properly exercised their right to redeem their shares for cash at a redemption price of approximately $11.20 per share, for an aggregate redemption amount of approximately $0.11 million, leaving approximately $21.73 million in the Trust Account.
Added
Known for popular ramen noodle brands like the high protein Chef Woo, Chef Ramsay, Ramen Express, and Woodles, Borealis Foods brings innovative fusion flavors from diverse culinary traditions, creating delicious and nutritious meal options for consumers. With U.S.-based production facilities, the company’s portfolio reflects a commitment to quality, innovation, and sustainability.
Removed
As of December 31, 2023, the Company had $21.92 million of marketable securities held in the Trust Account (including a deposit in transit of $0.05 million). On the Closing Date, Borealis, the Company, and Newco, consummated the Transaction, following the approval at an extraordinary general meeting of the shareholders of Oxus held on February 2, 2024.
Added
The Company continued to execute a strategic repositioning of its revenue base and customer portfolio in 2024, with an emphasis on gross margin expansion and operational efficiency. While total revenue declined compared to the prior year, gross profit turned positive, reflecting improved pricing dynamics, a 27 more favorable product mix, and a deliberate move away from low-margin, high-volume retail partnerships.
Removed
Conversion of Class B Ordinary Shares On April 5, 2023, in accordance with the provisions of the Oxus Charter, our Sponsor exercised its right to convert 1,500,000 shares of Class B ordinary shares, par value $0.0001 per share, of the Company into 1,500,000 shares of Class A ordinary shares, par value $0.0001 per share, of the Company on a one-for-one basis.
Added
(“ Oxus ”) and 1000397116 Ontario Inc., an Ontario corporation and a wholly owned subsidiary of Oxus (“ Newco ”).
Removed
As of December 31, 2023, following conversion, there were 6,552,131 ordinary shares of the Company issued and outstanding, consisting of 3,739,631 Class A ordinary shares (of which 1,939,631 shares are redeemable) and 2,812,500 Class B ordinary shares. 23 Results of Operations We have neither engaged in any operations nor generated any revenues through the balance sheet date.
Added
On February 7, 2024, Legacy Borealis, Oxus, and Newco consummated the transactions (collectively, the “ Reverse Recapitalization ”) contemplated by the Business Combination Agreement by means of a statutory arrangement under the Canada Business Corporations Act and the Business Corporations Act (Ontario), implemented in accordance with the terms and conditions set forth in the Business Combination Agreement and the related plan of arrangement (as amended, amended and restated, supplemented, or otherwise modified from time to time, the “ Plan of Arrangement ”) following the approval at an extraordinary general meeting of the shareholders of Oxus held on February 2, 2024.
Removed
Our only activities from February 3, 2021 (inception) through December 31, 2023, were related to the Company’s formation and the Initial Public Offering, and since the offering, identifying and evaluating prospective acquisition targets for a Business Combination. We do not expect to generate any operating revenues until after the completion of our Business Combination.
Added
References to our “management” or our “management team” refer to our officers and directors, and references to the “sponsor” refer to Oxus Capital Pte. Ltd. The term “New Borealis” refers to Borealis Foods Inc. after the consummation of the Business Combination. Accounting Impact of the Reverse Recapitalization The Reverse Recapitalization transaction was accounted for as a reverse recapitalization.
Removed
We expect to generate non-operating income in the form of interest income or dividend income on marketable securities held after the Initial Public Offering. We incur expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as for due diligence expenses.
Added
Oxus was deemed the accounting predecessor and Borealis is the successor SEC registrant. Under this method of accounting, Oxus was treated as the acquired company for financial statement reporting purposes. For accounting purposes, Legacy Borealis was deemed to be the accounting acquirer in the transaction and, consequently, the transaction was treated as a reverse recapitalization of Legacy Borealis.
Removed
For the year ended December 31, 2023, we had a net loss of $2.94 million, which consisted of dividend income of $2.20 million, interest income of $5,159, foreign exchange loss of $17,334 and operating expenses of $5.13 million.
Added
Accordingly, the consolidated balance sheets and results of operations of Legacy Borealis became the historical financial statements of Borealis, and Oxus’ assets, liabilities, and results of operations were consolidated with Legacy Borealis’ beginning on February 7, 2024. The net assets of Oxus were recognized at carrying value, with no goodwill or other intangible assets recorded.
Removed
For the year ended December 31, 2022, we had a net loss of $0.30 million, which consisted of dividend income of $2.58 million, interest income of $4,010, foreign exchange gains of $1,073 and operating expenses of $2.89 million.
Added
Basis of Presentation Borealis Foods’ consolidated financial statements were prepared in accordance with U.S. GAAP.
Removed
Liquidity and Going Concern Until the consummation of the Initial Public Offering, our only source of liquidity was an initial purchase of ordinary shares by the Sponsor and loans from the Sponsor. On September 8, 2021, the Company consummated the Initial Public Offering of 15,000,000 units, at a price of $10.00 per unit, generating gross proceeds of $150.00 million.
Added
See Note 1 to our consolidated financial statements for a full description of our basis of presentation. 28 Results of Operations The following sets forth a summary of our results of operations for the presented months ($ in thousands): Comparison of the Years Ended December 31, 2024 and 2023 Years Ended December 31, 2024 2023 2024 vs 2023 Variance $ % of Revenues, net $ % of Revenues, net $ % of Prior Period Revenues Gross sales 29,100 31,377 (2,277) Sales discounts & allowances (1,431) (5)% (1,392) (5)% (39) —% Revenue, net 27,669 29,985 (2,316) Cost of goods sold 23,156 84% 27,352 91% (4,196) (7)% Depreciation 2,324 8% 3,937 13% (1,613) (5)% Total cost of goods sold 25,480 92% 31,289 104% (5,809) (12)% Gross profit (loss) 2,189 8% (1,304) (4)% 3,493 12% Sales & marketing 5,733 21% 2,238 7% 3,495 14% Business development 2,395 9% 819 3% 1,576 6% Training 1,715 6% 2,727 9% (1,012) (3)% General & administrative expenses 12,751 46% 12,861 43% (110) 3% Total sales, general & administrative expenses 22,594 82% 18,645 62% 3,949 20% Loss from operations (20,405) (74)% (19,949) (67)% (456) (7)% Total other expense (5,057) (18)% (7,866) (26)% 2,809 8% Loss before income taxes (25,462) (92)% (27,815) (93)% 2,353 1% Income tax benefit 135 —% 336 1% (201) (1)% Net loss $ (25,327) (92)% $ (27,479) (92)% $ 2,152 —% Other financial Data Adjusted EBITDA $ (4,822) (17)% $ (5,133) (17)% $ 312 —% Adjusted EBITDA is a non-GAAP financial metric.
Removed
Simultaneously with the closing of the Initial Public Offering, we consummated the sale of 8,400,000 Private Warrants at a price of $1.00 per warrant in a private placement to Sponsor and the underwriters, generating gross proceeds of $8.40 million.
Added
See “Reconciliation of EBITDA and Adjusted EBITDA” below for a reconciliation of net income to EBITDA and Adjusted EBITDA for each applicable period. Revenue and Customer Trends Net Revenue declined 8% year-over-year to $27.7 million in 2024. The decline was primarily driven by the rationalization of low-margin SKUs and the reduction in volume with mass retail partners.
Removed
On September 13, 2021, the underwriters exercised the over-allotment option in full and purchased an additional 2,250,000 units, generating gross proceeds of $22.50 million.
Added
Gross profit improved to $2.2 million, compared to a gross loss of $1.3 million in the prior year. Net gross margin, less depreciation improved from 9% ($-1.3 million + $3.9 million divided by $30.0 million) to 16% ($2.2 million + $2.3 million divided by $27.7 million), a 7% increase year-over-year.
Removed
In connection with the underwriters’ full exercise of the over-allotment option, the Company issued an additional 900,000 Private Warrants at a price of $1.00 per warrant in a private placement to Sponsor and the underwriters, generating gross proceeds of $0.90 million.
Added
Revenue concentration with Walmart was reduced to 22% of total sales, from 57% in the prior year. We replaced most of our Ramen Express brand shelf space to launch Chef Woo and Gordon Ramsay products in the soup aisle, a major pivot to our high margin flag ship brands.
Removed
Following the Initial Public Offering and the private placement, a total of $175.95 million was placed in the Trust Account (at $10.20 per Unit). We incurred $4.15 million in transaction costs, including $3.45 million of underwriting fees and $0.70 million of other offering costs.
Added
This change in strategy allows major national ramp up of our high protein ramen products without pricing pressure from low cost competition.
Removed
On August 10, 2023, Legacy Borealis entered into a $25,000,000 financing agreement with a maturity date in July 2026. Under this agreement, Borealis Foods (as successor-in-interest to Legacy Borealis) has a $15,000,000 term facility which was used to pay off amounts outstanding under, and to terminate, a then existing line of credit.
Added
The launch of our products in food service to supply educational and other institutional customers is expected to be a major driver of the company's future revenues. 29 Product Mix and Margin Enhancement Chef Woo - High Protein Ramen, our flag ship brand, generated revenue of $10.4 million, an increase of 200% year over year, representing 38% of total gross sales.
Removed
In addition to the term facility, Legacy Borealis entered into a $10,000,000 revolving line of credit. The term facility and the revolving line of credit are secured by liens on substantially all of the assets of Borealis Foods (as successor-in-interest to Legacy Borealis) and its subsidiaries.
Added
We also launched our Food Service product line, which generated revenue totaling $3.75 million in its first year. Gross margin less depreciation improved to 16% in 2024, compared to 9% in 2023. This turnaround was driven by an improved product mix, SKU optimization, and enhanced operational controls.
Removed
Interest is payable under the term facility and the revolving line of credit at the annual rate of Prime + 4.75 % and Prime + 4.5%, respectively. As of March 31, 2024, $15 million principal amount was outstanding under the term facility and no principal amount was outstanding under the revolving line of credit.
Added
Key drivers of margin expansion included: • Product Mix • Customer Mix • Operational efficiencies The increased contribution from Chef Woo and the launch of Food Service product lines played a significant role in enhancing profitability, reflecting our efforts to emphasize branded, premium-positioned offerings.
Removed
In February 2024, the Company completed its Business Combination, resulting in approximately $50.3 million of convertible debt converting into equity. At the completion of the Business Combination, the Company had marketable securities in the Trust Account of $0.6 million. The reduction in Trust Account holdings resulted principally from shareholder redemptions.
Added
Operating Expenses and SG&A Trends Sales, General, and Administrative (SG&A) expenses rose 21% year over year to $22.6 million, or 82% of net revenue, compared to 62% in the prior year. The increase reflected ongoing investments in organizational development, brand building, and customer acquisition. Sales and Marketing expenses nearly doubled to $5.73 million.
Removed
The Company expects lower operating expenses in 2024 with the completion of the merger. For the year ended December 31, 2023, cash used in operating activities was $2.34 million. Net loss of $2.94 million which consisted of the dividend received of $2.20 million and foreign exchange loss of $17,334.
Added
Within that, advertising costs increased to $4.49 million, primarily associated with brand development and influencer/social media driven marketing for national launch of products. Major effort was made in 2024 to develop new business channels and strategic partnerships with significant monetization opportunity.
Removed
Changes in operating assets and liabilities provided $2.79 million of total cash for operating activities. For the year ended December 31, 2022, cash used in operating activities was $2.11 million. Net loss of $0.30 million which consisted of the dividend received of $2.58 million and foreign exchange gain of $1,073.
Added
Administrative expenses decreased to $12.75 million, a decrease of 1% year-over-year, driven by: • A decline in professional fees of $2.1 million, as one-time legal and audit costs from the prior year did not recur.
Removed
Changes in operating assets and liabilities provided $0.78 million of total cash for operating activities. As of December 31, 2023, and December 31, 2022, we had marketable securities held in the Trust Account of $21.92 million (including a deposit in transit of $0.05 million) and $178.53 million, respectively.
Added
Professional fees and transactional expenses related to the merger, meeting public-company regulatory requirements in the prior year. • A 50% increase in wages and benefits to $3.8 million, reflecting added headcount and increased compensation results in a 5% increase as a percentage of sales. • An $832,000 increase in freight costs due to our broader distribution and diversification of customer mix.
Removed
The reduction in Trust Account holdings resulted principally from shareholder redemptions. 24 Based on its present business plan and taking into account Borealis Foods’ working capital and cash anticipated to be generated through operations, Borealis Foods will require additional capital to fund its anticipated funding needs through March 31, 2025.
Added
Stock-based compensation expense, related to the immediate vesting of stock options associated with the reverse recapitalization, totaled $1.3 million, representing non-cash charges related to long-term incentive programs. Interest and Other Income/Expense Interest expense totaled $5.1 million, a decline from $7.9 million in the prior year.
Removed
The amount of additional capital required to fund Borealis Foods through March 31, 2025 has been reduced as a result of a change in Borealis Foods’ business plan that reduced the need for additional capital expenditures relating to the expansion of its production lines beyond the current four production lines. In addition, Borealis Foods continues to seek additional financing.
Added
The reduction resulted from: . • Conversion of debt to equity • Lower reliance on high-interest debt instruments. 30 No gains or losses were recognized on the sale of assets in the current year as compared to $963,000 loss recognized during the prior year. Foreign currency gains were minimal, totaling $3,600.
Removed
In the event Borealis Foods’ additional financing efforts are not successful, Borealis Foods may seek to pursue alternatives which may include, among other things, scaling down research and development, business develop investments, and global distribution expansion until such time that new capital has been secured..
Added
Liquidity and Capital Resources As of year-end, we had $0.6 5 million in cash, $1.97 million in accounts receivable, net and $2.23 million in finished good inventory compared to $7.62 million in cash, $1.78 million in accounts receivable net and $1.94 million in finished goods inventory as of the prior year end.
Removed
Off-Balance Sheet Arrangements We have no obligations, assets, or liabilities, which would be considered off-balance sheet arrangements as of December 31, 2023. We do not participate in transactions that create relationships with unconsolidated entities or financial partnerships, often referred to as variable interest entities, which would have been established for the purpose of facilitating off-balance sheet arrangements.
Added
The reduction in cash was attributable to operating cash use, inventory build-up to support institutional accounts, and SG&A expenditures. Following our SPAC merger and public listing on Nasdaq, we did not receive any proceeds from the SPAC trust, as redemption totaled 100%. Additionally, the Company incurred substantial transaction-related costs, which placed immediate strain on available working capital.
Removed
We have not entered into any off-balance sheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities, or purchased any non-financial assets. Contractual Obligations We do not have any long-term debt, capital lease obligations, operating lease obligations or long-term liabilities, other than described below.
Added
This liquidity constraint limited the Company’s ability to pursue new customer relationships, fund promotions, and invest in broader marketing initiatives. In addition, one-time extraordinary cost of shipping in raw materials precluded the Company from taking advantage of quantity discounts. Liquidity constraints had a major impact on the cost of raw materials impacting the company's gross margin significantly.
Removed
We have engaged the Underwriters as advisors in connection with our Business Combination to assist the Company in holding meetings with its shareholders to discuss the potential Business Combination and the target business’ attributes, introduce the Company to potential investors that are interested in purchasing the Company’s securities in connection with a Business Combination, assist the Company in obtaining shareholder approval for the Business Combination and assist the Company with its press releases and public filings in connection with the Business Combination.
Added
With improved liquidity savings in cost of raw materials and shipping is expected to have a significant impact on the Company's gross margins. Current liabilities decreased 62% to $25.4 million, primarily driven by the conversion of notes payable to equity as a result of the reverse recapitalization.
Removed
The Company will pay the Underwriters a cash fee for such services upon the consummation of a Business Combination of $5.2 million that equals to 3.0% of the gross proceeds of Initial Public Offering (exclusive of any applicable finders’ fees which might become payable).
Added
Cash Flows The following table sets forth our cash flows for the periods indicated ($ in thousands): Years Ended December 31, 2024 2023 Net cash (used in) provided by: Operating Activities $ (15,090) $ (18,005) Investing Activities (1,907) (4,466) Financing Activities 10,034 24,940 31 Operating Activities Net cash used in operating activities for the year ended December 31, 2024, was $15.09 million, primarily driven by the net loss of $25.33 million, adjusted for non-cash charges of $2.32 million for depreciation and amortization, and $1.27 million for stock-based compensation.
Removed
Making estimates requires management to exercise significant judgment. It is at least reasonably possible that the estimate of the effect of a condition, situation or set of circumstances that existed at the date of the financial statement, which management considered in formulating its estimate, could change in the near term due to one or more future confirming events.
Added
This represents an improvement from the $18.01 million used in the same period of 2023, as Borealis Foods benefited from enhanced gross profit due to the performance of high-margin products like Chef Woo and Woodles, which partially offset operational expenses.
Removed
Estimates made in preparing these financial statements include, among other things, the fair value measurement of shares transferred by the Sponsor to independent director nominees and fair value of shares to be transferred on completion of the Business Combination as per the Incentive agreements entered by the Sponsor and officers of the Company. Actual results could differ from those estimates.
Added
Investing Activities Net cash used in investing activities was $1.91 million for the year ended December 31, 2024, primarily attributable to purchases of property and equipment, offset by proceeds from the reverse recapitalization, to support production scale and efficiency improvements.
Removed
Warrants We do not use derivative instruments to hedge exposures to cash flow, market, or foreign currency risks. We evaluate all of our financial instruments, including issued stock purchase warrants, to determine if such instruments are derivatives or contain features that qualify as embedded derivatives, pursuant to ASC 480 and ASC 815-15.
Added
This increase from $4.47 million in 2023 aligns with our focused approach to capital expenditures, particularly as the Company seeks to improve asset utilization and operational efficiencies without significant expansion of its production line.

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