What changed in Edible Garden AG Inc's 2023 10-K compared to 2022?

Across the narrative sections we track, Edible Garden AG Inc (EDBL) added 276 paragraphs, removed 240, and edited 161 between the 2022 and 2023 10-K filings. The biggest movers are Item 1. Business (+92/−105), Item 1A. Risk Factors (+106/−74), Item 7. Management's Discussion & Analysis (+75/−49).

Did Edible Garden AG Inc add new Risk Factors in the 2023 10-K?

Yes — Item 1A Risk Factors shows 106 new/edited paragraphs and 74 removed paragraphs versus the 2022 10-K.

What changed in Edible Garden AG Inc's MD&A (Item 7) in 2023?

Item 7 Management's Discussion & Analysis shows 75 new/edited paragraphs and 49 removed paragraphs year-over-year. Read the side-by-side diff to see exactly which revenue, margin, and outlook commentary was rewritten.

Did Edible Garden AG Inc's Legal Proceedings (Item 3) change in 2023?

Item 3 shows 1 added/edited paragraphs and 10 removed paragraphs — usually indicating new litigation disclosed or settled cases removed.

Where does this EDBL 10-K diff come from?

The source filings are Edible Garden AG Inc's official 2022 and 2023 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 Edible Garden AG Inc's 10-K — 2022 vs 2023

Paragraph-level year-over-year comparison of Edible Garden AG Inc's 2022 and 2023 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 2023 report.

+276 added−240 removedSource: 10-K (2024-04-01) vs 10-K (2023-03-22)

Top changes in Edible Garden AG Inc's 2023 10-K

276 paragraphs added · 240 removed · 161 edited across 6 sections

Item 1. Business+92 / −105 · 75 edited
Item 1A. Risk Factors+106 / −74 · 60 edited
Item 7. Management's Discussion & Analysis+75 / −49 · 23 edited
Item 3. Legal Proceedings+1 / −10 · 1 edited
Item 2. Properties+1 / −1 · 1 edited

Item 1. Business

Business — how the company describes what it does

75 edited+17 added−30 removed65 unchanged

2022 filing

2023 filing

Biggest changeOur nominating and governance committee is responsible for overseeing these fundamental areas. 2022 and 2021 Sustainability, Waste Reduction and Carbon Emission Avoidance The following measures demonstrate Edible Garden’s ongoing commitment to sustainability, waste reduction and carbon neutrality for 2022: · The equivalent of 6 passenger car emissions were avoided by route optimization. · Reduced our overall fuel demand by 8,100 gallons of diesel fuel by route optimization. · Conserved 200 barrels of crude oil by route optimization. · 136 metric tons of virgin plastic use was avoided by a simple packaging change (hydro basil cup). · Recycled 32 metric tons of mixed recyclables including corrugate, plastic, and glass by implementing a recycling program. · Avoided 2 tons of food waste through a new donation program to local food pantries. · Reduced overall pesticide use by 30% using an Integrated Pest Management system. · Through recirculating water systems, we were able to reduce the amount of water used by 936,000 gallons.

Biggest changeOur nominating and governance committee is responsible for overseeing these fundamental areas. 2023 Sustainability, Waste Reduction and Carbon Emission Avoidance The following measures demonstrate Edible Garden’s ongoing commitment to sustainability, waste reduction and carbon neutrality for 2023: · 54 passenger car emissions were avoided by co-loading orders and backhauling supplies. · Reduced our overall fuel demand by 10,200 gallons of diesel fuel by route optimization. · Conserved 850 barrels of crude oil by route optimization. · 67 metric tons of virgin corrugate materials were avoided by eliminating the carrier in our hydro basil cases. · Recycled 34 metric tons of mixed recyclables including corrugate, plastic, and glass by maintaining our recycling program. · Avoided 78 tons of food waste by packing larger crops in taller boxes and by making food donations to local programs like Food Shed Alliance. · Saved 1,000,000 gallons of water used by recirculating water systems and capturing run-off. 15 Table of Contents Total estimated emissions avoided in 2023: 115,574 metric tons of CO 2 .

Intellectual Property We rely on a combination of trademark laws, trade secrets, confidentiality provisions, and other contractual provisions to protect our proprietary rights, which are primarily our inventions, brand names, marks, and proprietary pods and seeds. Edible Garden owns trademarks, three pending patent applications, and two issued patents in the United States.

Intellectual Property We rely on a combination of trademark laws, trade secrets, confidentiality provisions, and other contractual provisions to protect our proprietary rights, which are primarily our inventions, brand names, marks, and proprietary pods and seeds. Edible Garden owns trademarks, has two pending patent applications, and three issued patents in the United States.

This alignment and focus will aid us in steering our long-term corporate actions in the right direction. Our goal is to build diversity across the whole enterprise with specific focus on the management team and board of directors.

The combination of: (1) our 5-acre, 200,000 square ft., flagship greenhouse location in Belvidere, NJ (“Flagship Facility”); (2) our recently acquired 5-acre, 200,000 square ft., Heartland Facility in Grand Rapids, Michigan (“Edible Garden Heartland”); and (3) over 480,000 square feet of available growing capacity in contracted greenhouse space from contract growers, enables us to use standardized methods and a suite of proprietary technology innovations to operate these hydroponic greenhouses and deliver consistent, fresh produce.

The combination of: (1) our 5-acre, 200,000 square ft., flagship greenhouse location in Belvidere, NJ (“Flagship Facility”); (2) our 5-acre, 200,000 square ft., Heartland Facility in Grand Rapids, Michigan (“Edible Garden Heartland”); and (3) over 480,000 square feet of available growing capacity in contracted greenhouse space from contract growers, enables us to use standardized methods and a suite of proprietary technology innovations to operate these hydroponic greenhouses and deliver consistent, fresh produce.

These key partners make up the majority of our revenue. We believe that we will continue capture more opportunities with these partners as we expand our business and product offering. We also utilize an efficient marketing mix of social media, in-store signage and premium shelf positioning to drive consumer awareness and reinforce purchases. Value Proposition .

The issued patents include claims related to greenhouse management software and systems (GreenThumb) and are expected to remain in force until November 2040, provided that all required maintenance fees are paid. One of the three pending patent applications is a recently filed continuation patent application related to greenhouse management software and systems.

The issued patents include claims related to greenhouse management software and systems (GreenThumb) and are expected to remain in force until November 2040, provided that all required maintenance fees are paid. One of the two pending patent applications is a recently filed continuation patent application related to greenhouse management software and systems.

Overall consumer behavior is shifting away from commoditized produce as they associate consumer branded produce as sustainable, safe, organic, pesticide free all year long that is good for them and the social fabric of our planet.

Overall consumer behavior is shifting away from commoditized produce as they associate consumer branded produce as sustainable, safe, and organic all year long that is good for them and the social fabric of our planet.

The Social criteria examines how we manage relationships with employees, suppliers, customers, and the communities where we operate. Our Governance deals with the company’s leadership, executive pay, audits, internal controls and stockholder rights. 11 Table of Contents Environment : We operate our CEA greenhouse facilities with the goal of being a good steward of nature.

The Social criteria examines how we manage relationships with employees, suppliers, customers, and the communities where we operate. Our Governance deals with the company’s leadership, executive pay, audits, internal controls and stockholder rights. Environment : We operate our CEA greenhouse facilities with the goal of being a good steward of nature.

(now known as Unrivaled Brands, Inc.)(“Terra Tech”). We purchased substantially all of the assets of Edible Garden Corp., a subsidiary of Terra Tech, from Terra Tech as of March 30, 2020 .Our company was incorporated on March 28, 2020 in the State of Wyoming as Edible Garden Inc.

(previously known as Unrivaled Brands, Inc., now known as Blum Holdings, Inc.) (“Terra Tech”). We purchased substantially all of the assets of Edible Garden Corp., a subsidiary of Terra Tech, from Terra Tech as of March 30, 2020. Our company was incorporated on March 28, 2020 in the State of Wyoming as Edible Garden Inc.

From the Landlord’s perspective, it has been receiving consistent lease payments from an operator of the property since at least 2015 and from us for over two years, and many of the same individuals that worked for our predecessor company at the New Jersey facility continue to work at the facility as Edible Garden employees.

From the Landlord’s perspective, it has been receiving consistent lease payments from an operator of the property since at least 2015 and from us for over three years, and some of the same individuals that worked for our predecessor company at the New Jersey facility continue to work at the facility as Edible Garden employees.

We believe this strategy allows us to drive local grass roots brand awareness while we grow our business to support our plan to become a national brand. Acquisitions Our strategy for growth includes acquisitions. Our acquisition strategy includes expanding our greenhouse capacity in order to reduce our dependence on contract growers which we believe will benefit our profit margin.

That’s why we believe as a market innovator we can continue to capture market share and brand awareness. 10 Table of Contents Growth Strategy We are at an important point as we are operating at commercially viable scale and ready for the next level of growth with additional greenhouses and capabilities.

That’s why we believe as a market innovator we can continue to capture market share and brand awareness. 13 Table of Contents Growth Strategy We are at an important point as we are operating at a commercially viable scale and ready for the next level of growth with additional greenhouses, processing and finished goods capabilities.

However, we believe the following elements will give us a competitive advantage in the rapidly growing CEA category: 9 Table of Contents Customer Relationships and Brand . Our herbs and lettuce product portfolio is sold through our supermarket partners including Walmart, Target, Meijer, Wakefern Food Corporation/ShopRite King Kullen, D’Agostino’s, Kroger, Food Bazaar and food distributors.

However, we believe the following elements will give us a competitive advantage in the rapidly growing CEA category: 12 Table of Contents Customer Relationships and Brand . Our herbs and lettuce product portfolio is sold through our supermarket partners including Walmart, Target, Meijer, Wakefern Food Corporation/ShopRite King Kullen, D’Agostino’s, Tops, H-Mart, and food distributors.

If this pending patent is granted, it would remain in force until at least November 2040, provided that all required maintenance fees are paid. The two remaining patent applications, a design patent application and a utility patent application, are related to automatically watering display stands for herbs and other vegetation.

If this pending patent is granted, it would remain in force until at least November 2040, provided that all required maintenance fees are paid. The other pending patent application is related to automatically watering display stands for herbs and other vegetation.

If the contract grower has not grown enough of a specific product to fulfill a purchase order, we attempt to supplement the order with products from other growers or the New Jersey facility to meet the customer’s order. We only pay the contract grower for the number of products we purchase from them.

If the contract grower has not grown enough of a specific product to fulfill a purchase order, we attempt to supplement the order with products from other growers, Edible Garden Heartland or the Flagship Facility to meet the customer’s order. We only pay the contract grower for the number of products we purchase from them.

For example, we partner with Abilities of Northwest Jersey Inc. to offer skills training in hydroponics and greenhouse farming at our Belvidere, New Jersey, greenhouse for individuals with disabilities, and we were named the Employer of the Year for 2020 by Abilities of Northwest Jersey. These initiatives aim to provide better economic and social results for these underserved communities.

We also partner with Abilities of Northwest Jersey Inc. to offer training in production and manufacturing at our Belvidere, New Jersey, greenhouse for individuals with disabilities, and we were named the Employer of the Year for 2020 by Abilities of Northwest Jersey. These initiatives aim to provide better economic and social results for these underserved communities.

The SEC maintains a website at www.sec.gov that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC.

The SEC maintains a website at www.sec.gov that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC. 16 Table of Contents

Since January 1, 2022, we have grown or purchased products grown in the following locations and with the following potential growing capacity: Location Growing capacity Operated by Flagship Facility (Belvidere, New Jersey) 5 acres Edible Garden Edible Garden Heartland (Grand Rapids, Michigan) 5 acres Edible Garden Francesville, Indiana 3 acres Contract grower Grand Rapids, Michigan 6 acres Contract grower Hixton, Wisconsin 3 acres Contract grower Order Process We rely on long-term relationships with contract growers to grow our herbs and produce, but have no formal long-term contracts with these growers.

We believe we have sufficient potential growing capacity with contract growers, at Edible Garden Heartland and at our Flagship Facility to supply products to our existing customers. 9 Table of Contents Since January 1, 2023, we have grown or purchased products grown in the following locations and with the following potential growing capacity: Location Growing capacity Operated by Flagship Facility (Belvidere, New Jersey) 5 acres Edible Garden Edible Garden Heartland (Grand Rapids, Michigan) 5 acres Edible Garden Francesville, Indiana 3 acres Contract grower Grand Rapids, Michigan 6 acres Contract grower Hixton, Wisconsin 3 acres Contract grower Order Process We rely on long-term relationships with contract growers to grow our herbs and produce but have no formal long-term contracts with these growers.

Our main competitors are Aero Farms, Gotham Greens, Bright Farms, Bowery Farms, Plenty. Many of these companies may have significantly greater financial, technical, marketing and distribution resources, as well as greater experience in the industry than we have. Our services may not be competitive with their services.

Competition The U.S. fruits and vegetable markets are highly competitive. Our main competitors are Gotham Greens, Bright Farms, Bowery Farms and Plenty. Many of these companies may have significantly greater financial, technical, marketing and distribution resources, as well as greater experience in the industry than we have. Our services may not be competitive with their services.

In our hydroponic greenhouse, we grow plants without soil. Instead of planting one row of lettuce in the ground, by using a vertical greenhouse, we can grow many towers of lettuce in the same area by planting up instead of planting across.

Instead of planting one row of lettuce in the ground, by using a vertical greenhouse, we can grow many towers of lettuce in the same area by planting up instead of planting across.

In particular we are subject to the FSM Act, which is enforced by the FDA. The FDA has the authority to regulate the growing, harvesting manufacture, including composition and ingredients, processing, labeling, packaging import, distribution and marketing and safety of food in the United States. The FSM Act significantly enhances the FDA's authority over various aspects of food regulation.

The FDA has the authority to regulate the growing, harvesting manufacture, including composition and ingredients, processing, labeling, packaging import, distribution and marketing and safety of food in the United States. The FSM Act significantly enhances the FDA's authority over various aspects of food regulation.

If the Landlord did not assign the current lease or renegotiate a new lease with us, the Landlord would have to find another suitable tenant for the facility, which could result in additional costs to the Landlord or the risk of holding a vacant property.

With our closed loop systems, we recapture and recycle water into our growing process. We are pesticide-free in our Flagship Facility, Edible Garden Heartland and all contracted grow facilities. In vertical greenhouses, we are able to grow more herbs and lettuce per square foot than legacy farms.

With our closed loop systems, we recapture and recycle water into our growing process. We use integrated pest management instead of traditional pesticides in our Flagship Facility, Edible Garden Heartland and all contracted grow facilities. In vertical greenhouses, we are able to grow more herbs and lettuce per square foot than legacy farms.

Site selection for future facilities is based on a detailed methodology that weighs factors we believe to be indicative of farm unit economics, operational reliability and market accessibility, among other criteria. Examples include customer access and market depth within a 300-mile radius.

Our business plan is to develop, own and operate commercial greenhouses across North America through a combination of organic and acquisitive growth. Presently and in the near term our greenhouse operations will continue to grow herbs and lettuces.

Item 1. Business Overview Edible Garden is a controlled environment agriculture (“CEA”) farming company. We use traditional agricultural growing techniques together with technology to grow fresh, organic food, sustainably and safely while improving traceability. We use the controlled environment of traditional greenhouse structures, such as glass greenhouses, together with hydroponic and vertical greenhouses to sustainably grow organic herbs and lettuces.

Our predecessor company benefits from our effective assumption of the lease, because we are making lease payments that the predecessor company would otherwise be obligated to pay. In addition, an affiliate of our predecessor company, Sament Capital Investments, Inc.

Our predecessor company benefits from our effective assumption of the lease, because we are making lease payments that the predecessor company would otherwise be obligated to pay.

Our telephone number is (908) 750-3953. We maintain a website at www.ediblegarden.com . The information contained on our website is not, and should not be interpreted to be, incorporated into this Annual Report on Form 10-K.

Our principal address is 283 County Road 519, Belvidere, NJ 07823. Our telephone number is (908) 750-3953. We maintain a website at ediblegardenag.com . The information contained on our website is not, and should not be interpreted to be, incorporated into this Annual Report on Form 10-K.

Industry Overview Traditional Outdoor Agriculture . The traditional agriculture industry in the United States consists primarily of field crop farms. According to the USDA, the United States had almost 900 million acres of farmland in 2019. Over the last few decades this acreage has shifted and consolidated to larger and larger farms.

The traditional agriculture industry in the United States consists primarily of field crop farms. According to the USDA, the United States had more than 255 million planted acres of farmland in December of 2023. Over the last few decades the acreage has shifted and consolidated to larger and larger farms.

If the contract grower has grown more of a specific product than is needed to fulfill a purchase order, we attempt to supplement other purchase orders that may need more of that product. Ultimately, if the contract grower sows too much of one crop than is needed to fill the purchase order, the contract grower must absorb those costs.

If the contract grower has grown more of a specific product than is needed to fulfill a purchase order, we attempt to supplement other purchase orders that may need more of that product.

When we undergo the GFSI audit, Primus audits the following: · standard operating procedures and their documentation; · food safety testing (biological hazards) by an ISO 17025 accredited lab; · water testing by an ISO 17025 accredited lab; · quality control processes; · personnel health, hygiene and safety; · sanitation programs; · mock recalls/products on-hold process; · internal auditing system for organic, GFSI, non-GMO and HACCP certifications and verifications; · records retention; · food defense/food fraud; · supplier approval program; · pest management program; and · visual inspection of growing and packing processes. 5 Table of Contents To maintain our USDA Organic certification, we must submit: · our farm and handling plans annually; · to an annual inspection and audit of our greenhouse and how we handle aspects of our business; · to review of our organic documentation and records retention; · to review and testing of our water usage and irrigation systems, harvest and post-harvest processing; and supplier monitoring and control.

Research and Product Development Edible Garden recognizes the consumer acceptance and growth opportunities associated with plant-based derivatives of the products/plants it currently grows. As a leader in sustainability, research and development is a key focus for us moving forward. We sell plant-based nutraceuticals under the Vitamin Way brand. These products are produced by a co-manufacturer according to our specifications.

As a leader in sustainability, research and development is a key focus for us moving forward. We sell plant-based nutraceuticals under the Vitamin Way brand. These products are produced by a co-manufacturer according to our specifications.

We are currently party to an ongoing, informal arrangement with our predecessor company, Edible Garden Corp., whereby we made lease payments of approximately $15,500 per month and $15,300 per month during 2022 and 2021, respectively, to the Landlord of the land on which our Flagship Facility is built and for which our predecessor company is the lessee.

We are currently party to an ongoing, informal arrangement with our predecessor company, Edible Garden Corp., whereby we made lease payments of approximately $21,860 and $21,860 per month during the years ended December 31, 2023 and 2022, respectively, to the lessor of the land on which our Flagship Facility is built, Whitetown Realty, LLC (the “Landlord”), and for which our predecessor company is the lessee.

We converted into a Delaware corporation effective July 12, 2021. On September 8, 2021, we effected an additional forward stock split of 20 for 1. On January 26, 2023, we effected a reverse stock split of 1 for 30. As of December 31, 2022, we had 77 full-time employees. Our principal address is 283 County Road 519, Belvidere, NJ 07823.

We converted into a Delaware corporation effective July 12, 2021. On September 8, 2021, we effected an additional forward stock split of 20 for 1. On January 26, 2023, we effected a reverse stock split of 1 for 30. As of December 31, 2023, we had 124 employees, of which 116 were full-time employees.

The quantity of products sown will later be used to fill a purchase order. The forecast precedes any purchase order from us or the customer because the products take time to grow and customers in the industry adjust their orders frequently to attempt to meet demand without taking on excess perishable inventory.

The forecast precedes any purchase order from us or the customer because the products take time to grow and customers in the industry adjust their orders frequently to attempt to meet demand without taking on excess perishable inventory. We typically receive purchase orders from our customers one to two weeks prior to harvest of the products.

Social - Employees : Being local and producing year-round not only allows for competitive produce prices and the opportunity for more consumers to access high quality produce, it also allows our facilities to offer full time, indoor jobs to members of the community, offsetting the seasonal work offered by more traditional agriculture businesses.

We are working to help those partners who are not currently pursuing sustainability goals to move in that direction by raising awareness and providing information and guidance. 14 Table of Contents Social - Employees : Being local and producing year-round not only allows for competitive produce prices and the opportunity for more consumers to access high quality produce, it also allows our facilities to offer full time, indoor jobs to members of the community, offsetting the seasonal work offered by more traditional agriculture businesses.

Less product spoilage means less waste, and less shrinkage means that we will not have to produce as many lettuce and herbs to achieve the same level of retail sales.

Less product spoilage means less waste, and less shrinkage means that we will not have to produce as many lettuce and herbs to achieve the same level of retail sales. Altogether, we should be able to produce less carbon and minimize the size of our carbon footprint by using these packaging innovations.

We source the raw materials for production from multiple suppliers, including Ball Horticulture, Brandt Box and Paper, PPC Flexible Packing, Sumit Plastics, Sun Gro Horticulture, Sunshine FPC, and expect that those supplies will continue to be available for our use.

We do not anticipate construction on the packhouse will impact our ability to operate the property. We source the raw materials for production from multiple suppliers, including Ball Horticulture, Brandt Box and Paper, Griffin Supplies, Summit Plastics and Sun Gro Horticulture, and expect that those supplies will continue to be available for our use.

Pulp In November 2022, we acquired the assets of Pulp, including its line of sustainable gourmet sauces and chili-based products. Pulp’s product lines are all-natural, Non-GMO and preservative free. The products include Hungarian wax hot sauce, poblano serrano jalapeno hot sauce, Fresno chili hot sauce, habanero carrot hot sauce, salsa macha, chili crisp, and chili oil.

Pulp’s product lines are certified organic, all-natural, Non-GMO and preservative free. The products include Hungarian wax hot sauce, poblano serrano jalapeno hot sauce, Fresno chili hot sauce, Habanero carrot hot sauce, salsa macha, chili crisp, and chili oil.

Social - Community : We will prioritize underserved communities whether urban or rural where our facilities are located. As a company we will continue to develop our corporate mission of giving back to these communities. For example, we give back to our local communities by making charitable contributions to food banks, school systems, community anti-hunger and social reintegration programs.

We sell products to our customers on a purchase order basis, with no spend or purchase commitments, in the ordinary course of business. We and our customers enter into purchase orders on a daily basis. To date, no purchase order has exceeded 2.0% of our revenue for the particular quarter in which the products were delivered to the customer.

We and our customers enter into purchase orders on a daily basis. Other than purchase orders relating to the Supply Agreements, no purchase order has exceeded 2.0% of our revenue for the particular quarter in which the products were delivered to the customer. Since inception, a few of our customers constitute a majority of our total revenue.

We focus our efforts on producing our herbs and vegetables in a sustainable manner that will reduce consumption of natural resources, by recycling water in our closed loop system and using LED lights instead of conventional lightbulbs to accelerate crop growth and yield, when necessary.

The combination of the GreenThumb software, quality assurance and control processes (including compliance with food safety standards), and feedback from consumers and purchasers holds us accountable for maintaining the quality of our herbs and lettuce. 4 Table of Contents We focus our efforts on producing our herbs and vegetables in a sustainable manner that will reduce consumption of natural resources, by recycling water in our closed loop system and using LED lights instead of conventional lightbulbs to accelerate crop growth and yield, when necessary.

We are licensed under Perishable Agricultural Commodities Act (“PACA”) to operate our business. We voluntarily comply with the Hazard Analysis Critical Control Point (“HACCP”) principles established by the U.S. Food and Drug Administration (“FDA”). Primus annually audits our growing process and entire food safety management system to ensure that our process and products meet the standards established by the GFSI.

This entity owns and leases the delivery vehicles we use to distribute products and holds the liability insurance needed for the transportation aspects of our business. As of December 31, 2022, we have 11 delivery vehicles and less than 10 drivers. Competition The U.S. fruits and vegetable markets are highly competitive.

We hold our transportation-related assets and manage the distribution of our products through our wholly-owned subsidiary, EG Transportation, LLC. This entity owns and leases the delivery vehicles we use to distribute products and holds the liability insurance needed for the transportation aspects of our business. As of December 31, 2023, we have 14 delivery vehicles and less than 10 drivers.

We plan to continue to deliver innovation in the products we use for our packaging and potting, further eliminating plastics from our products with recycled, biodegradable packaging. We intend to migrate to alternative fuel vehicles for our shipping needs by 2030.

We plan to continue to deliver innovation in the products we use for our packaging and potting, further eliminating plastics from our products with recycled, biodegradable packaging. We continually try to find partners who share our vision and commitment to sustainability.

Total estimated emissions avoided: 442 metric tons of CO 2 . 12 Table of Contents Regulatory Compliance As a producer and distributor of food products, we are subject to the laws and regulations in the jurisdictions where our facilities are located and where are products are distributed.

Regulatory Compliance As a producer and distributor of food products, we are subject to the laws and regulations in the jurisdictions where our facilities are located and where are products are distributed. In particular we are subject to the FSM Act, which is enforced by the FDA.

Our growing relationships require our produce to be grown in strict accordance with our proprietary growing process and to our specifications, but otherwise leaves control over the growing process to the contract growers. 7 Table of Contents We use our GreenThumb software to analyze year-over-year and trending sales data to develop customer-specific and aggregate product-specific forecasts.

Instead, we and the growers use purchase orders to transact business. Our growing relationships require our produce to be grown in strict accordance with our proprietary growing process and to our specifications, but otherwise leaves control over the growing process to the contract growers.

We expect lower cost of sales by growing, picking and shipping our products instead of working with a contract grower to grow those products. In addition to serving customers in the Midwest, the facility will house a research and development center focused on improving existing products, developing new products, innovations in plant-based protein and nutraceuticals, and applying advanced agricultural technologies.

In addition to serving customers in the Midwest, the facility will house a research and development center focused on improving existing products, developing new products, innovations in plant-based protein and nutraceuticals, and applying advanced agricultural technologies. In November 2022, we acquired the assets of Pulp, including its line of sustainable gourmet sauces and chili-based products.

Each week, we provide our contract growers an estimated forecast that the grower can use to determine the quantity of herbs or produce it will sow. We use the same forecasts to determine what products to grow in the facility in Belvidere, New Jersey and the Heartland Facility.

We use our GreenThumb software to analyze year-over-year and trending sales data to develop customer-specific and aggregate product-specific forecasts. Each week, we provide our contract growers an estimated forecast that the grower can use to determine the quantity of herbs or produce it will sow.

Rather than relying on “off-the-shelf” systems, we have created a data-driven technology platform to power traceability and integration across plant production, operations, data analytics and demand planning. Our proprietary platform allows us to consistently monitor and control plant production inputs across our Flagship Facility as well as integrate with all of our contract growers.

Technology Platform . Technology and data are competitive differentiators for Edible Garden. Rather than relying on “off-the-shelf” systems, we have created a data-driven technology platform to power traceability and integration across plant production, operations, data analytics and demand planning.

The Flagship Facility also includes a cold storage freezer which allows us to package herbs for our distribution partners and a 20,000 sq. ft packhouse, which is under construction. Because we control the growing and shipping processes at this facility, we bear inventory risk, risk of loss, and other risks for the produce grown at this facility.

Our facility incorporates a hydroponic gutter system developed in Holland for the exclusive production of herbs. The Flagship Facility also includes a cold storage freezer which allows us to package herbs for our distribution partners and a 20,000 sq. ft packhouse, which is under construction.

We use herb bags that have micro-perforations that allow ethylene gas to escape from the product packaging. Ethylene gas accelerates spoilage of herbs and lettuce.

For our supermarket customers, one source of this shrinkage is spoiled product, such as herbs that have been in packaging for so long that they become poor quality. We use herb bags that have micro-perforations that allow ethylene gas to escape from the product packaging. Ethylene gas accelerates spoilage of herbs and lettuce.

Heartland Facility in Grand Rapids, Michigan On August 30, 2022, through our wholly owned subsidiary, 2900 Madison Ave Holdings, LLC (the “Michigan Subsidiary”), we acquired a five-acre greenhouse facility in Grand Rapids, Michigan for $2,886,000. The greenhouse facility is operating as Edible Garden Heartland.

Greenhouse expansion also supports our effort to grow local which reduces transportation costs. We also expect to make acquisitions that expand our consumer product offerings that leverage our channels to market. On August 30, 2022, through our wholly owned subsidiary, 2900 Madison Ave Holdings, LLC (the “Michigan Subsidiary”), we acquired a five-acre greenhouse facility in Grand Rapids, Michigan for $2,886,000.

Altogether, we should be able to produce less carbon and minimize the size of our carbon footprint by using these packaging innovations. _________________________ 1 “Shelf Life Studies: Herbs,” Windham Packaging, LLC. 6 Table of Contents More recently we have expanded our product line to include nutraceuticals and other food products as well as vitamins, plant and whey proteins, and other products utilizing next-generation plant ingredients grown and sourced using sustainable methods.

More recently we have expanded our product line to include nutraceuticals and other food products as well as vitamins, plant and whey proteins, and other products utilizing next-generation plant ingredients grown and sourced using sustainable methods.

We expect these full-scale commercial greenhouses to have more production capacity than our current facility and contract growers and to benefit from economies of scale.

We plan to locate farms with easy access to distribution centers and major population demographic centers and to sell products into established supermarkets partners and distributors. We expect these full-scale commercial greenhouses to have more production capacity than our current facilities and contract growers and to benefit from economies of scale.

As discussed further in “Management’s Discussion and Analysis - Liquidity and Capital Resources,” our auditors have issued an opinion that there is a substantial doubt about our ability to continue as a going concern. 6 Table of Contents We believe that the power of our brand together with the quality, innovative packaging and traceability of our products allow all of our customers to associate Edible Garden with locally grown and sustainably sourced packaged herbs and vegetables.

In addition to serving customers in the Midwest, the facility will house a research and development center focused on improving existing products, developing new products, innovations in plant-based protein and nutraceuticals, and applying advanced agricultural technologies. 11 Table of Contents Distribution Edible Garden utilizes advanced, sustainable, environmentally controlled indoor agriculture to grow and process organic herbs and lettuces.

We distribute our products through more than 50 retail partners including national big box retailers, regional grocery stores, distributors, restaurants and local purveyors. Our growing and distribution plans are designed to get our locally grown products to our retail partners and consumers as soon as possible after harvest.

Through our extensive distribution platform and proprietary predictive modeling, we pick, pack and ship to big box retailer’s distribution centers in our network. We distribute our products through more than 50 retail partners including national big box retailers, regional grocery stores, distributors, restaurants and local purveyors.

The availability, reliability and cost of electricity; construction costs, speed to build, site infrastructure and permitting; local labor are further inputs to our selection process.

Examples include customer access and market depth within a 300-mile radius; the availability, reliability and cost of electricity; construction costs, speed to build, site infrastructure and permitting; and the availability of local labor.

Our fresh produce and plant-based protein products are currently sold at over 4,000 supermarket stores and food distributors across the Northeast, Midwest and Mid-Atlantic regions of the country. Some of the supermarkets that sell our products include Walmart, Target, Meijer, Wakefern Food Corporation/ShopRite, King Kullen, D’Agostino’s, Kroger, and Food Bazaar. We also service a large number of food distributors.

Some of the supermarkets that sell our products include Walmart, Target, Meijer, Wakefern Food Corporation/ShopRite, King Kullen, D’Agostino’s, Tops Friendly Markets, and H-Mart. We also service a large number of food distributors.

Heartland Facility in Grand Rapids, Michigan On August 30, 2022, through the Michigan Subsidiary, we acquired a five-acre greenhouse facility in Grand Rapids, Michigan, which operates as Edible Garden Heartland. During the year ended December 31, 2023, Edible Garden Heartland transitioned to growing our herbs and lettuce products, adding five acres of directly controlled growing capacity to our operations.

We want to make sure that our products arrive as fresh, undegraded and nutrient rich as when they were harvested. In order for us to meet this objective we strive to deliver our products to market in no less than 24 hours from when they are picked.

In order for us to meet this objective we strive to deliver our products to market in no less than 24 hours from when they are picked. We currently rely on our own fleet delivery vehicles, as well as other independent shipping operators. We continue to assess our footprint and optimize our logistics and shipping fleet.

Products and Customers We currently offer 34 stock keeping units (“SKUs”) and expect to further cross sell products across our supermarket partners to meet their demand.

In addition to selling these products through traditional retail channels, we sell some of these products directly to consumers in the United States through an e-commerce platform. Products We currently offer more than 79 stock keeping units (“SKUs”) and expect to further cross sell products across our supermarket partners to meet their demand.

After the applicable permits from the county government have been obtained by the Landlord, the construction of the packhouse should take between six months and one year to complete. We anticipate investing between $700,000 to $900,000 in capital expenditures to add utilities such as HVAC, electrical service, septic system, and a well to complete the packhouse.

We anticipate investing approximately $1.1 million in capital expenditures to add paving and utilities such as HVAC, electrical service, septic system, and a well to complete the packhouse. To date, we have paid $272 thousand towards the construction of the packhouse. The Landlord is aware of the construction of the packhouse.

Should these pending patent applications be granted, the design patent would remain in force until February 2035 and the utility patent would remain in force until February 2041, provided that all required maintenance fees are paid for the utility patent.

Should this pending patent application be granted, the design patent will remain in force until February 2035, provided that all required maintenance fees are paid for the utility patent. Research and Product Development Edible Garden recognizes the consumer acceptance and growth opportunities associated with plant-based derivatives of the products/plants it currently grows.

Using this material, we are able to reduce our use of plastic in our business. Generally, retail shrink is a loss of inventory. For our supermarket customers, one source of this shrinkage is spoiled product, such as herbs that have been in packaging for so long that they become poor quality.

The packaging we use for our produce features bio-based (sugar cane) sleeves. Using this material, we are able to reduce our use of plastic in our business. Generally, retail shrink is a loss of inventory.

For example, during the years ended December 31, 2022 and 2021, we earned approximately 76% of our revenue from three customers, and at December 31, 2022 and 2021, approximately 68% and 79%, respectively, of our gross outstanding trade receivables were attributable to these three customers.

For example, during the year ended December 31, 2023, we earned approximately 83.1% of our revenue from five customers (44.4% of which was attributed to sales made to one customer), and at December 31, 2023 approximately 80.4% of our gross outstanding trade receivables were attributed to four customers (41.1% of which was due from one customer).

In addition, our proposition focuses on intelligent, common-sense approach to growing more with less resources. Our Zero Waste Inspired approach is in everything we do - from innovative recyclable packaging across our product portfolio and enterprise, using less water, electricity and land, zero pesticides and less road miles.

Our Zero Waste Inspired approach is in everything we do - from innovative recyclable packaging across our product portfolio and enterprise, using less water, electricity and land, integrated pest management and less road miles. Simply Local Simply Fresh delivers all of this together with our local farming partners with an accessible, traceable, organic product at a competitive price.

After Edible Garden Heartland is fully transitioned to growing our herbs and lettuce products, which is expected during the first half of 2023, it will add approximately five acres of directly controlled growing capacity to our operations. We believe the addition of Edible Garden Heartland will contribute to higher gross margin over time.

The greenhouse facility is operating as Edible Garden Heartland. During the year ended December 31, 2023, Edible Garden Heartland fully transitioned to growing our herbs and lettuce products, adding approximately five acres of directly controlled growing capacity to our operations. Additionally, in September 2023 we began shipping fall ornamental products grown in our Edible Garden Heartland facility.

Flagship Facility in Belvidere, New Jersey In addition to our contract growers, we operate a 5-acre Flagship Facility in Belvidere, New Jersey, which began commercial operations in 2015. Our facility incorporates a hydroponic gutter system developed in Holland for the exclusive production of herbs.

Ultimately, if the contract grower sows too much of one crop than is needed to fill the purchase order, the contract grower must absorb those costs. 10 Table of Contents Flagship Facility in Belvidere, New Jersey In addition to our contract growers, we operate a 5-acre Flagship Facility in Belvidere, New Jersey, which began commercial operations in 2015.

We are part of repositioning the way food is grown, packaged and distributed. We believe this is the next generation of farming that is good for people and our planet. We believe scaling our grow operations in a fully controlled environment will result in a higher optimization on yields together with freshness, taste and texture.

We believe scaling our grow operations in a fully controlled environment will result in a higher optimization on yields together with freshness, taste and texture. In addition, our proposition focuses on intelligent, common-sense approach to growing more with less resources.

We expect to scale our business by building or acquiring a portfolio of new, fully scaled commercial greenhouses across the Northeast, Midwest, Mid-Atlantic, South and Southwest. We plan to locate farms with easy access to distribution centers and major population demographic centers and to sell products into established supermarkets partners and distributors.

This combination of growing know-how to inform finished goods with more shelf stability should lead us to additional market penetration while benefiting from expected margin expansion. Additionally, we expect to scale our business by building or acquiring a portfolio of new, fully scaled commercial greenhouses across the Northeast, Midwest, Mid-Atlantic, South and Southwest.

The packaging we use for our produce leverages the latest technology to reduce plastics, extend the shelf life of our products, and reduce retail shrink - all leading to a reduced carbon footprint by reducing waste. The packaging we use for our produce features bio-based (sugar cane) sleeves.

These products include: · 10 types of individually potted, live herbs; · 37 types of cut single-herb clamshells; · 4 specialty herb items; · butterhead lettuce; · 6 garden salad kits; · wheatgrass; · hydro basil; · 12 vitamin and protein powder products; · 4 fermented hot sauces; · 3 chili oil products. 7 Table of Contents The packaging we use for our produce leverages the latest technology to reduce plastics, extend the shelf life of our products, and reduce retail shrink - all leading to a reduced carbon footprint by reducing waste.

Food and Drug Administration (“FDA”). 4 Table of Contents Primus annually audits our growing process and entire food safety management system to ensure that our process and products meet the standards established by the GFSI. We value this certification because our customers require purchasing products from producers who are GFSI certified.

We value this certification because our customers require purchasing products from producers who are GFSI certified.

We believe the addition of Edible Garden Heartland will contribute to higher gross margin over time. We expect lower cost of sales by growing, picking and shipping our products instead of working with a contract grower to grow those products.

Removed

Added

We use the controlled environment of traditional greenhouse structures, such as glass greenhouses, together with hydroponic and vertical greenhouses to sustainably grow organic herbs, lettuces and floral products. In our hydroponic greenhouse, we grow plants without soil.

Removed

To maintain our USDA Organic certification, we must submit: · our farm and handling plans annually; · to an annual inspection and audit of our greenhouse and how we handle aspects of our business; · to review of our organic documentation and records retention; and · to review and testing of our water usage and irrigation systems, harvest and post-harvest processing, and supplier monitoring and control.

Added

Our protein powder is sold under the Vitamin Way brand and is available in chocolate, vanilla, strawberry, and cookies n’ crème flavors, while our Vitamin Way collagen powder is available in chocolate and vanilla. Our Vitamin Way shake product is organic & vegan plant-based, dairy-free and contains 20g of non-GMO, gluten-free, organic pea, brown rice & pumpkin proteins.

Removed

We believe that the power of our brand together with the quality, innovative packaging and traceability of our products allow all of our customers to associate Edible Garden with locally grown and sustainably sourced packaged herbs and vegetables.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

60 edited+46 added−14 removed138 unchanged

2022 filing

2023 filing

Biggest changeIf we are unable to assert that our internal control over financial reporting is effective, we could lose investor confidence in the accuracy and completeness of our financial reports, which would have a material adverse effect on the price of our common stock.

Biggest changeFurther, if we are unable to conclude that our internal control over financial reporting is effective, or, if and when required, our independent registered public accounting firm is unable to express an unqualified opinion as to the effectiveness of our internal control over financial reporting, investors may lose confidence in the accuracy and completeness of our financial statements, the market price of our common stock could be adversely affected, our common stock could become subject to delisting and we could become subject to litigation or investigations by the stock exchange or exchanges on which our securities are listed, the SEC or other regulatory authorities, any of which could require additional financial and management resources.

In addition, general public perceptions regarding the quality, safety, or health risks associated with particular food products could reduce demand for some of our products. Food safety warnings, advisories, notices, and recalls, such as those administered by the FDA, the Center for Disease Control and Prevention, other federal/state government agencies, could also reduce demand.

In addition, general public perceptions regarding the quality, safety, or health risks associated with particular food products could reduce demand for some of our products. Food safety warnings, advisories, notices, and recalls, such as those administered by the FDA, the Center for Disease Control and Prevention, and other federal/state government agencies, could also reduce demand.

Additionally, we may take advantage of certain reduced disclosure obligations as a “smaller reporting company” as defined in Item 10(f)(1) of Regulation S-K. To the extent we take advantage of such reduced disclosure obligations, it may also make comparison of our financial statements with other public companies difficult or impossible.

Additionally, we may take advantage of certain reduced disclosure obligations as a “smaller reporting company” as defined in Item 10(f)(1) of Regulation S-K. To the extent we take advantage of such reduced disclosure obligations, it may also make the comparison of our financial statements with other public companies difficult or impossible.

Successful integration involves many challenges, including: · the difficulty of integrating acquired operations and personnel with our existing operations; · the difficulty of developing, manufacturing, and marketing new products and services; · the diversion of our management’s attention as a result of evaluating, negotiating and integrating acquisitions; · in some cases, our exposure to unforeseen liabilities of acquired companies; and · the loss of key employees of an acquired business operation. 18 Table of Contents In addition, an acquisition could adversely impact cash flows, operating results, and stockholder interests, for many reasons, including: · contingent consideration payments; · the issuance of securities in connection with an acquisition or new business venture that dilutes or lessens the rights of our current stockholders; · charges to our income to reflect the impairment of acquired intangible assets, including goodwill; and · interest costs and debt service requirements for any debt incurred in connection with an acquisition or new business venture.

Successful integration involves many challenges, including: · the difficulty of integrating acquired operations and personnel with our existing operations; · the difficulty of developing, manufacturing, and marketing new products and services; · the diversion of our management’s attention as a result of evaluating, negotiating and integrating acquisitions; · in some cases, our exposure to unforeseen liabilities of acquired companies; and · the loss of key employees of an acquired business operation. 22 Table of Contents In addition, an acquisition could adversely impact cash flows, operating results, and stockholder interests, for many reasons, including: · contingent consideration payments; · the issuance of securities in connection with an acquisition or new business venture that dilutes or lessens the rights of our current stockholders; · charges to our income to reflect the impairment of acquired intangible assets, including goodwill; and · interest costs and debt service requirements for any debt incurred in connection with an acquisition or new business venture.

There is a risk that in the event of such a dissolution, there will be insufficient funds to repay amounts owed to holders of any of our indebtedness and insufficient assets to distribute to our capital stock holders, in which case our stockholders could lose their entire investment.

There is a risk that in the event of such a dissolution, there will be insufficient funds to repay amounts owed to holders of any of our indebtedness and insufficient assets to distribute to our capital stockholders, in which case our stockholders could lose their entire investment.

For example, our certificate of incorporation authorizes our Board of Directors, without stockholder approval, to issue one or more series of preferred stock, which could have voting and conversion rights that adversely affect or dilute the voting power of the holders of common stock.

For example, our certificate of incorporation authorizes our Board, without stockholder approval, to issue one or more series of preferred stock, which could have voting and conversion rights that adversely affect or dilute the voting power of the holders of common stock.

If we were unable to access the property and continue operations in Belvidere, New Jersey, we may: · lose the ability to continue growing as great a quantity of herbs and lettuce; · incur costs in locating and leasing or purchasing a substitute for the Flagship Facility; · incur costs in purchasing new equipment or improving equipment at a new leased facility; · incur increased costs in filling purchase orders from our customers from contract growers; · lose access to the management team and skilled employees that operate the Flagship Facility, if we were to relocate those operations; · risk our earned reputation with customers if there is a disruption in our business; and · harm our reputation in our community.

If we were unable to access the property and continue operations in Belvidere, New Jersey, we may: · lose the ability to continue growing as great a quantity of herbs and lettuce; · incur costs in locating and leasing or purchasing a substitute for the Flagship Facility; · incur costs in purchasing new equipment or improving equipment at a new leased facility; · incur increased costs in filling purchase orders from our customers from contract growers; · lose access to the skilled employees that operate the Flagship Facility, if we were to relocate those operations; · risk our earned reputation with customers if there is a disruption in our business; and · harm our reputation in our community.

Additionally, a significant theft, loss or misappropriation of, or access to, customers’ or other proprietary data or other breach of our information technology systems could result in fines, legal claims or proceedings. 21 Table of Contents Risks Related to Our Industry Failure to obtain necessary permits or otherwise comply with USDA regulations and requirements could result in a ban or temporary suspension of our ability to grow, manufacture or market our products as organic, and thus could materially adversely affect our business.

Additionally, a significant theft, loss or misappropriation of, or access to, customers’ or other proprietary data or other breach of our information technology systems could result in fines, legal claims or proceedings. 25 Table of Contents Risks Related to Our Industry Failure to obtain necessary permits or otherwise comply with USDA regulations and requirements could result in a ban or temporary suspension of our ability to grow, manufacture or market our products as organic, and thus could materially adversely affect our business.

Any of the foregoing events would lead to increased competition and lower revenue or gross margins, which could adversely affect our operating results. 20 Table of Contents Confidentiality agreements with employees and third parties may not prevent unauthorized disclosure of trade secrets and other proprietary information, and our inability to maintain the confidentiality of that information, due to unauthorized disclosure or use, or other event, could have a material adverse effect on our business.

Any of the foregoing events would lead to increased competition and lower revenue or gross margins, which could adversely affect our operating results. 24 Table of Contents Confidentiality agreements with employees and third parties may not prevent unauthorized disclosure of trade secrets and other proprietary information, and our inability to maintain the confidentiality of that information, due to unauthorized disclosure or use, or other event, could have a material adverse effect on our business.

If any analyst who may cover us were to cease coverage of our company or fail to regularly publish reports on us, we could lose visibility in the financial markets, which in turn could cause our stock and warrant prices or trading volume to decline. 27 Table of Contents Item 1B. UNRESOLVED STAFF COMMENTS None.

If any analyst who may cover us were to cease coverage of our company or fail to regularly publish reports on us, we could lose visibility in the financial markets, which in turn could cause our stock and warrant prices or trading volume to decline. 30 Table of Contents Item 1B. UNRESOLVED STAFF COMMENTS None.

The impact of seasonal demand and the sales cycle for our products may cause our results to vary from quarter to quarter, which may make an investment in us less attractive to some investors. 22 Table of Contents Increases in commodity or raw product input costs, such as fuel and packaging materials, could increase costs significantly.

The impact of seasonal demand and the sales cycle for our products may cause our results to vary from quarter to quarter, which may make an investment in us less attractive to some investors. 26 Table of Contents Increases in commodity or raw product input costs, such as fuel and packaging materials, could increase costs significantly.

Accordingly, any change in the availability of these local raw materials could adversely affect our operating results. 17 Table of Contents Because our business is concentrated on a limited set of products, we are vulnerable to changes in consumer preferences and changes in economic conditions affecting disposable income that could harm our financial results.

Accordingly, any change in the availability of these local raw materials could adversely affect our operating results. 21 Table of Contents Because our business is concentrated on a limited set of products, we are vulnerable to changes in consumer preferences and changes in economic conditions affecting disposable income that could harm our financial results.

Any bankruptcy or other business disruption involving one of our significant customers also could adversely affect our results of operations. 15 Table of Contents Our business is characterized by low margins, which are sensitive to inflationary and deflationary pressures, and intense competition and consolidation in the grocery industry, and our inability to increase our gross margins could adversely affect our results of operations.

Any bankruptcy or other business disruption involving one of our significant customers also could adversely affect our results of operations. 19 Table of Contents Our business is characterized by low margins, which are sensitive to inflationary and deflationary pressures, and intense competition and consolidation in the grocery industry, and our inability to increase our gross margins could adversely affect our results of operations.

Information posted may be adverse to our interests or may be inaccurate, each of which may harm our performance, prospects or business. The harm may be immediate and may disseminate rapidly and broadly, without affording us an opportunity for redress or correction. 19 Table of Contents We are subject to risk of product contamination and product liability claims.

Information posted may be adverse to our interests or may be inaccurate, each of which may harm our performance, prospects or business. The harm may be immediate and may disseminate rapidly and broadly, without affording us an opportunity for redress or correction. 23 Table of Contents We are subject to risk of product contamination and product liability claims.

If we were to otherwise attempt to sell material assets or operations, the foregoing encumbrances may limit our ability to dispose of material assets or operations. In the event that the lenders enforced their rights to our assets, we may have to discontinue our business, and our stockholders could lose all or a part of their investment in us.

If we were to otherwise attempt to sell material assets or operations, the foregoing encumbrances may limit our ability to dispose of material assets or operations. In the event that the counterparties enforced their rights to our assets, we may have to discontinue our business, and our stockholders could lose all or a part of their investment in us.

We cannot assure you that any of our existing or future patents or other intellectual property rights will be enforceable, will not be challenged, invalidated or circumvented, or will otherwise provide us with meaningful protection or any competitive advantage. In addition, our three pending patent applications may not be granted.

If that were to occur, our reputation with our customers could suffer, and we may ultimately lose those customers and be unable to continue our business. 16 Table of Contents Our secured indebtedness could have important consequences to you. Our secured indebtedness could have important consequences to you.

If that were to occur, our reputation with our customers could suffer, and we may ultimately lose those customers and be unable to continue our business. 20 Table of Contents Our secured indebtedness could have important consequences to you. Our secured indebtedness could have important consequences to you.

As a result, it may be more difficult for us to attract and retain qualified individuals to serve on our board of directors or as our executive officers.

As a result, it may be more difficult for us to attract and retain qualified individuals to serve on our Board or as our executive officers.

We are an “emerging growth company,” as defined in the JOBS Act, and a “smaller reporting company” within the meaning of the Securities Act, and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies or smaller reporting companies will make our common stock less attractive to investors.

We are an “emerging growth company,” as defined in the JOBS Act, and a “smaller reporting company” within the meaning of the Securities Act of 1933, as amended (the “Securities Act”), and we cannot be certain if the reduced disclosure requirements applicable to emerging growth companies or smaller reporting companies will make our common stock less attractive to investors.

You may not realize a return on your investment in our common stock and you may even lose your entire investment in our common stock. We may seek to raise funds, finance acquisitions or develop strategic relationships in the future by issuing securities that would dilute your ownership.

You may not realize a return on your investment in our common stock and you may even lose your entire investment in our common stock. 28 Table of Contents We may seek to raise funds, finance acquisitions or develop strategic relationships in the future by issuing securities that would dilute your ownership.

If we are unable to increase our gross margins, our results of operations will be adversely affected. Our relationships with customers and suppliers are based on purchase orders rather than long-term purchase commitments. We are subject to uncertainty because our relationships with customers and suppliers are based on purchase orders rather than long-term purchase commitments.

If we are unable to increase our gross margins, our results of operations will be adversely affected. Our relationships with customers and suppliers are primarily based on purchase orders rather than long-term purchase commitments.

Consumer purchases of specialty retail products, including our products, are discretionary in nature and are historically affected by economic conditions such as changes in employment, salary and wage levels, and confidence in prevailing and future economic conditions as may be affected by geopolitical issues, such as the Russian invasion of Ukraine, trade restrictions, unseasonable weather, pandemics and other public health emergencies, as well as other factors that are outside of our control.

Consumer purchases of specialty retail products, including our products, are discretionary in nature and are historically affected by economic conditions such as changes in employment, salary and wage levels, and confidence in prevailing and future economic conditions as may be affected by geopolitical events, political instability, trade restrictions, unseasonable weather, pandemics and other public health emergencies, as well as other factors that are outside of our control.

We effectively rent the property on a month-to-month basis with no set term. We do not have a lease in place directly with the lessor of the property that gives us the right to operate the property, and there is no written agreement between us and our predecessor company or us and the Landlord describing this arrangement.

We do not have a lease in place directly with the lessor of the property that gives us the right to operate the property, and there is no written agreement between us and our predecessor company or us and the Landlord describing this arrangement.

Discretionary purchases may decline during recessionary periods or at other times when disposable income is lower, such as during highly inflationary periods. If periods of decreased consumer spending persist, our sales could decrease, and our financial condition and results of operations could be adversely affected. Our business would be adversely affected by the departure of members of our management team.

Our stock price is subject to wide fluctuations in response to a variety of factors, which include: · whether we achieve our anticipated corporate objectives; · actual or anticipated fluctuations in our quarterly or annual operating results; · changes in our financial or operational estimates; · our ability to implement our operational plans; · changes in the economic performance or market valuations of companies similar to ours; and · general economic or political conditions in the United States or elsewhere. 26 Table of Contents In addition, broad market and industry factors may seriously affect the market price of our common stock, regardless of actual operating performance.

If we were to dissolve, the holders of our securities may lose all or substantial amounts of their investments. If we were to dissolve as a corporation, as part of ceasing to do business or otherwise, we will be required to pay all amounts owed to any creditors before distributing any assets to holders of our capital stock.

If we were to dissolve as a corporation, as part of ceasing to do business or otherwise, we will be required to pay all amounts owed to any creditors before distributing any assets to holders of our capital stock.

If these increases continue or worsen, including due to inflationary pressures, and we are unable to pass those increased costs on to our customers, our gross margin will decline and our financial results would be negatively impacted. We may not successfully integrate assets from acquisitions. We completed two asset acquisitions during 2022: Edible Garden Heartland and Pulp.

We expect our capital expenses and operational expenses to increase in the future due to expected costs to retrofit the Edible Garden Heartland facility, increased sales and marketing expenses, operational costs, and general and administrative costs and, therefore, our operating losses will continue or even increase at least through the near term.

We expect our capital expenses and operational expenses to increase in the future due to increased sales and marketing expenses, operational costs, packhouse construction costs, and general and administrative costs and, therefore, our operating losses will continue or even increase at least through the near term.

Shifts in consumer spending could result in increased pressure from competitors or customers that may require us to increase promotional spending or reduce the prices of some products, which could then lower revenue and profitability.

Economic uncertainty could also result in changing consumer preference and could reduce the demand for our products. Shifts in consumer spending could result in increased pressure from competitors or customers that may require us to increase promotional spending or reduce the prices of some products, which could then lower revenue and profitability.

Negative global and national economic trends, such as decreased consumer and business spending, high inflation, rising interest rates, high unemployment levels and declining consumer and business confidence, pose challenges to our business and could result in declining revenue, profitability and cash flow.

Negative global and national economic trends, such as decreased consumer and business spending, high inflation, changing interest rates, high unemployment levels and declining consumer and business confidence, pose challenges to our business and could result in declining revenue, profitability and cash flow. Unfavorable economic conditions may negatively affect demand for our products.

If we need additional capital and cannot raise it on acceptable terms, we may not be able to meet our business objectives, our stock price may fall and you may lose some or all of your investment. We have a relatively short operating history, which makes it difficult to evaluate our business and future prospects.

If we need additional capital and cannot raise it on acceptable terms, we may not be able to meet our business objectives, our stock price may fall and you may lose some or all of your investment.

We will continue to incur increased costs and demands upon management as a result of complying with the laws and regulations affecting public companies, which could adversely affect our operating results.

This litigation, if instituted against us, could result in substantial costs and a diversion of our management’s attention and resources. We will continue to incur increased costs and demands upon management as a result of complying with the laws and regulations affecting public companies, which could adversely affect our operating results.

If any of these risks occur, the trading price of our common stock could decline and you may lose all or part of your investment. 13 Table of Contents Risks Related to Our Business We have a history of losses, expect to continue to incur losses in the near term and may not achieve or sustain profitability in the future, and as a result, our management has identified and our auditors agreed that there is a substantial doubt about our ability to continue as a going concern.

Risks Related to Our Business We have a history of losses, expect to continue to incur losses in the near term and may not achieve or sustain profitability in the future, and as a result, our management has identified and our auditors agreed that there is a substantial doubt about our ability to continue as a going concern.

In addition, we have a material weakness in our internal control over financial reporting because we lack maintenance of appropriate documentation to support our internal controls and we have insufficiently reviewed reports identifying user entity controls.

Since these entity level controls have a pervasive effect across the organization, management has determined that these circumstances constitute a material weakness. In addition, we have a material weakness in our internal control over financial reporting because we lack maintenance of appropriate documentation to support our internal controls and we have insufficiently reviewed reports identifying user entity controls.

Economic uncertainty may reduce consumer spending as consumers make decisions on what to include in their food budgets, particularly if food costs increase more quickly than wages in an inflationary environment. Economic uncertainty could also result in changing consumer preference and could reduce the demand for our products.

An overall decline in economic activity could adversely impact our business and financial results. Economic uncertainty may reduce consumer spending as consumers make decisions on what to include in their food budgets, particularly if food costs increase more quickly than wages in an inflationary environment.

We are currently party to an ongoing, informal arrangement with our predecessor company, Edible Garden Corp., whereby we make lease payments of approximately $21,860 per month to the lessor of the land on which our facility is built, Whitetown Realty, LLC (the “Landlord”), and for which our predecessor company is the lessee.

We are currently party to an ongoing, informal arrangement with our predecessor company, Edible Garden Corp., whereby we make lease payments of approximately $21,860 per month to the Landlord, and for which our predecessor company is the lessee. We effectively rent the property on a month-to-month basis with no set term.

We have incurred significant losses since our inception. We experienced net losses of approximately $12.453 million in the year ended December 31, 2022 and $5.538 million in the year ended December 31, 2021.

We have incurred significant losses since our inception. We experienced net losses of approximately $10.2 million and $12.5 million for the years ended December 31, 2023 and 2022, respectively.

As a public company, we will continue to incur significant legal, accounting and other expenses that are not incurred by private companies, including costs associated with public company reporting and corporate governance requirements. These requirements include compliance with Section 404 and other provisions of the Sarbanes-Oxley Act, as well as rules implemented by the SEC and Nasdaq.

We face risks related to maintaining the volume demanded on a short-term basis from these customers, which can also divert resources away from other customers. This concentration of customers leaves us exposed to the risks associated with the loss of one or more of these significant customers, which would materially and adversely affect our revenue and results of operations.

This concentration of customers leaves us exposed to the risks associated with the loss of one or more of these significant customers, which would materially and adversely affect our revenue and results of operations.

A claim brought against us that is uninsured or underinsured could result in unanticipated costs, thereby adversely affecting our results of operations and resulting in a reduction in the trading price of our stock. We are currently party to an action for an alleged breach of contract with a former contract grower. See “Business — Legal Proceedings” for more information.

The prices for these raw materials fluctuate depending on market conditions and global demand for these materials and could adversely affect our business and operating results. Substantial increases in the prices for our raw materials increase our operating costs, and could reduce our margins if we cannot recoup the increased costs through increased prices for our products and services.

Substantial increases in the prices for our raw materials increase our operating costs and could reduce our margins if we cannot recoup the increased costs through increased prices for our products and services. 29 Table of Contents Litigation or regulatory actions may adversely affect our business, financial condition and results of operations.

If we grow more products than we are able to sell to our customers, we will incur losses and our results of operations and financial condition will be harmed.

Our customers can cancel purchase orders or defer the shipments of our products under certain circumstances with little or no advance notice to us. If we grow more products than we are able to sell to our customers, we will incur losses and our results of operations and financial condition will be harmed.

These requirements include compliance with Section 404 and other provisions of the Sarbanes-Oxley Act, as well as rules implemented by the Securities and Exchange Commission (“SEC”) and Nasdaq. Complying with these rules and regulations substantially increases our legal and financial compliance costs and makes some activities more time-consuming and costly than if we were a private company.

Complying with these rules and regulations substantially increases our legal and financial compliance costs and makes some activities more time-consuming and costly than if we were a private company.

Additional risks not presently known to us or that we currently believe are immaterial may materially affect our business, results of operations, or financial condition.

Additional risks not presently known to us or that we currently believe are immaterial may materially affect our business, results of operations, or financial condition. If any of these risks occur, the trading price of our common stock could decline and you may lose all or part of your investment.

If we experience dilution from the issuance of additional securities and we grant superior rights to new securities over holders of our common stock, it may negatively impact the trading price of our common stock and you may lose all or part of your investment. 24 Table of Contents Provisions in our certificate of incorporation, bylaws, and outstanding equity-linked securities could discourage a change in control, or an acquisition of us by a third party, even if the acquisition would be favorable to you, thereby adversely affecting existing stockholders.

Provisions in our certificate of incorporation, bylaws, and outstanding equity-linked securities could discourage a change in control, or an acquisition of us by a third party, even if the acquisition would be favorable to you, thereby adversely affecting existing stockholders.

For example, the tariffs currently imposed for importing goods from China has significantly increased. Any such an increase or supply interruption could materially negatively impact our business, prospects, financial condition and operating results. We use various raw materials in our business including aluminum.

Any such an increase or supply interruption could materially negatively impact our business, prospects, financial condition and operating results. We use various raw materials in our business including aluminum. The prices for these raw materials fluctuate depending on market conditions and global demand for these materials and could adversely affect our business and operating results.

We may also be subject to claims involving health and safety, hazardous materials usage, other environmental impacts, or service disruptions or failures. The cost to defend such litigation may be significant and may require a diversion of our resources.

We may also be subject to claims involving health and safety, hazardous materials usage, other environmental impacts, or service disruptions or failures. In addition, we may be subject to regulatory actions.

If we need to raise additional funds in the future, we cannot be certain that we will be able to obtain financing on favorable terms, if at all, and any financings could result in additional dilution to holders of our common stock.

The net cash used in operating activities was $8.5 million and $9.2 million for the years ended December 31, 2023 and 2022, respectively. We cannot be certain that we will be able to obtain financing on favorable terms, if at all, and any financings could result in additional dilution to holders of our common stock.

In addition, in the past, following periods of volatility in the overall market and the market price of a particular company’s securities, securities class action litigation has often been instituted against these companies. This litigation, if instituted against us, could result in substantial costs and a diversion of our management’s attention and resources.

In addition, broad market and industry factors may seriously affect the market price of our common stock, regardless of actual operating performance. In addition, in the past, following periods of volatility in the overall market and the market price of a particular company’s securities, securities class action litigation has often been instituted against these companies.

Unfavorable economic conditions may negatively affect demand for our products. 25 Table of Contents Increases in costs, disruption of supply or shortage of raw materials could harm our business. We may experience increases in the cost or a sustained interruption in the supply or shortage of raw materials.

Increases in costs, disruption of supply or shortage of raw materials could harm our business. We may experience increases in the cost or a sustained interruption in the supply or shortage of raw materials. For example, the tariffs currently imposed for importing goods from China has significantly increased.

Our secured indebtedness held by Sament Capital Investments, Inc. (“Sament”), is secured by a security interest in all of our assets located at the New Jersey Facility, and the Michigan Note is secured by a mortgage on Edible Garden Heartland. If we were to default on our obligations under these loans, the lenders would have the right to our assets.

The promissory note initially issued to Sament Capital Investments, Inc. and later assigned to third parties (the “Sament Note”) is secured by a security interest in all of our assets located at the New Jersey Facility, and the promissory note issued to the seller of Edible Garden Heartland (the “Michigan Note”) is secured by a mortgage on Edible Garden Heartland and a security interest in the assets at Edible Garden Heartland.

Additionally, if these requirements divert our management’s attention from other business concerns, they could have a material adverse effect on our business, financial condition and operating results. As a public company, we are obligated to develop and maintain proper and effective internal control over financial reporting.

Additionally, if these requirements divert our management’s attention from other business concerns, they could have a material adverse effect on our business, financial condition and operating results. If we were to dissolve, the holders of our securities may lose all or substantial amounts of their investments.

Our produce is grown at facilities we own or control in Michigan and New Jersey and at third-party locations by contract growers. Based on forecasts derived from our GreenThumb software, to ensure availability of products, we or our contract growers start sowing products in advance of receiving purchase orders for those products.

Based on forecasts derived from our GreenThumb software, to ensure availability of products, we or our contract growers start sowing products in advance of receiving purchase orders for those products. Inaccuracies in our forecasts of customer demand and product mix could negatively affect our ability to supply product to our customers and consequently, our operating results.

Because we are a small company with few employees in our finance department, we lacked the ability to have adequate segregation of duties in the financial statement preparation process. Since these entity level controls have a pervasive effect across the organization, management has determined that these circumstances constitute a material weakness.

As of December 31, 2023, we did not maintain effective controls over the control environment, including our internal control over financial reporting. Because we are a small company with few employees in our finance department, we lacked the ability to have adequate segregation of duties in the financial statement preparation process.

If those risks occur, we may be unable to continue our business and you could lose the entire value of your investment in us. 14 Table of Contents We may need to raise capital in the future, which may not be available on favorable terms, if at all, and which may cause dilution to holders of our common stock, restrict our operations or adversely affect our ability to operate and continue our business.

If those risks occur, we may be unable to continue our business and you could lose the entire value of your investment in us. 18 Table of Contents We have a relatively short operating history, which makes it difficult to evaluate our business and future prospects.

During the years ended December 31, 2022 and 2021, three customers accounted for approximately 76% of our total revenue, and at December 31, 2022 and 2021, approximately 61% and 79%, respectively, of our gross outstanding trade receivables were attributable to these three customers. These customers generally do not enter into long-term contracts.

At December 31, 2023, approximately 80.4% of our gross outstanding trade receivables were attributed to four customers (41.1% of which was due from one customer). As of December 31, 2022, approximately 68.0% of our gross outstanding trade receivables were attributed to three customers. These customers generally do not enter into long-term contracts.

Although we have additional personnel that contribute to our business, the loss of either of these executives could harm our ability to implement our business strategy, operate our day-to-day business and respond to the rapidly changing market conditions in which we operate.

James’ departure could materially adversely affect our ability to implement our business strategy, operate our day-to-day business, respond to the rapidly changing market conditions in which we operate, raise additional capital, develop our system of internal control over financial reporting and timely file our required reports with the SEC.

During the evaluation and testing process, if we identify one or more material weaknesses in our internal control over financial reporting, we will be unable to assert that our internal controls are effective.

If we are unable to remediate the identified material weaknesses or further implement and maintain effective internal control over financial reporting or disclosure controls and procedures, our ability to record, process and report financial information accurately and to prepare financial statements within required time periods could be adversely affected.

Risks Related to the Ownership of our Securities There can be no assurance that we will be able to comply with the continued listing standards of the Nasdaq Capital Market, a failure of which could result in a delisting of our common stock and certain warrants.

Risks Related to the Ownership of our Securities We are currently not in compliance with the Nasdaq continued listing requirements. If we are unable to regain compliance with Nasdaq’s listing requirements, our securities could be delisted, which could affect our common stock’s market price and liquidity and reduce our ability to raise capital.

Our success depends, in large part, on the continued contributions of James E. Kras and Michael James. Although we have employment agreements in place for each of these executives, we cannot assure you that each will remain with us for a specified period.

Although we have an employment agreement with our Chief Executive Officer, James Kras, we cannot assure you that he will remain with us for any specified period. The loss of Mr. Kras would harm our ability to implement our business strategy and operate our day-to-day business.

Removed

Inaccuracies in our forecasts of customer demand and product mix could negatively affect our ability to supply product to our customers and consequently, our operating results. Our customers can cancel purchase orders or defer the shipments of our products under certain circumstances with little or no advance notice to us.

Added

We will need to obtain additional financing to fund our operations, which may not be available on favorable terms, if at all, and if we are unable to obtain such financing, we may be unable to operate and continue our business.

Removed

We have material weaknesses in our internal control over financial reporting, which if left unremediated could materially and adversely affect the market price of our common stock. As of December 31, 2022, we did not maintain effective controls over the control environment, including our internal control over financial reporting.

Added

To date, we have financed our operations with the proceeds from debt financings, public and private securities offerings, and operations, among other sources.

Removed

If we are unable to remediate the material weaknesses, our financial reporting may not be reliable and the market price of our common stock may be adversely affected. Our performance may be impacted by general and regional economic volatility, inflation, or an economic downturn. An overall decline in economic activity could adversely impact our business and financial results.

Added

If we are unable to raise additional capital, we believe that the existing cash will fund operations into the second quarter of 2024 and will not be sufficient to fund our operations through the next twelve months beyond the date of the issuance of our consolidated financial statements. Our operations have consumed substantial amounts of cash since inception.

Removed

The Nasdaq Capital Market requires that the trading price of its listed stocks remain above $1.00 in order for the stock to remain listed. If a listed stock trades below $1.00 for more than 30 consecutive trading days, then it is subject to delisting from the Nasdaq Capital Market.

Added

Our inability to obtain additional funding when needed could seriously harm our business or make it impossible for us to continue to operate our business. 17 Table of Contents Our business may be adversely affected by the departure of members of our management team. Our success depends, in large part, on the continued contributions of our executives.

Removed

In addition, to maintain a listing on the Nasdaq Capital Market, we must satisfy minimum financial and other continued listing standards, including those regarding minimum stockholders’ equity, minimum publicly available shares, director independence and independent committee requirements and other corporate governance requirements.

Added

Effective January 25, 2024, our Chief Financial Officer retired from all of his roles with us. There is no assurance that we will be able to identify, attract or hire another permanent Chief Financial Officer in a timely manner. Although we have additional personnel that contribute to our business, Mr.

Removed

We recently regained compliance with Nasdaq’s listing standards, and Nasdaq will continue to monitor our compliance with the stockholders’ equity requirement.

Added

In addition, executive leadership transition periods, including adding new personnel, could be difficult as new executives gain an understanding of our business and strategy. Mr. James’ departure and difficulty integrating new executives could limit our ability to successfully execute our business strategy and could have a material adverse effect on our business, results of operations and financial condition.

Removed

If, at the time we file our report for the quarter ending March 31, 2023, we do not evidence compliance with the stockholders’ equity requirement, our common stock and traded warrants will be subject to delisting. 23 Table of Contents If we are unable to satisfy these standards, we could be subject to delisting, which would have a negative effect on the price of our common stock and warrants and would impair your ability to sell or purchase our common stock or warrants when you wish to do so.

Added

Changes to estimates related to our property, equipment and leasehold improvements that are lower than our current estimates have in the past and may in the future cause us to incur impairment charges on certain assets, which may adversely affect our results of operations.

Removed

In the event of a delisting, we would expect to take actions to restore our compliance with the listing standards, but we can provide no assurance that any action we take to restore our compliance would allow our common stock or warrants to become listed again, stabilize the market price or improve the liquidity of our common stock, prevent our common stock from dropping below the minimum bid price requirement, or prevent future noncompliance with the listing requirements.

Added

In accordance with accounting guidance, we estimated the value of the equipment and leasehold improvements that we acquired from our predecessor at the time of acquisition, and management is required to analyze whether impairment may exist for our assets. When impairment triggers are deemed to exist for assets, the estimated undiscounted future cash flows are compared to its carrying value.

Removed

Litigation may adversely affect our business, financial condition and results of operations.

Added

If the carrying value exceeds the undiscounted cash flows, an impairment charge equal to the difference between the carrying value and the fair value is recorded. The projections of future cash flows used in these analyses require the use of judgment and a number of estimates and projections of future operating results.

Removed

If we settle this claim or the action is not resolved in our favor, we may suffer reputational damage and incur legal costs, settlements or judgments that exceed the amounts covered by our existing insurance policies. We can provide no assurances that our insurer will insure the legal costs, settlements or judgments we incur in excess of our deductible.

Added

If actual results differ from our estimates, additional charges for asset impairments may be required in the future. If future impairment charges are significant, our reported operating results would be adversely affected.

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Item 2. Properties

Properties — owned and leased real estate

1 edited+0 added−0 removed6 unchanged

2022 filing

2023 filing

Biggest changeWe are party to an ongoing, informal arrangement with our predecessor company, Edible Garden Corp., whereby we make lease payments of approximately $21,860 per month to the lessor of the land on which our Flagship Facility is built, Whitetown Realty, LLC (the “Landlord”), and for which our predecessor company is the lessee.

Biggest changeWe are party to an ongoing, informal arrangement with our predecessor company, Edible Garden Corp., whereby we make lease payments of approximately $21,860 per month to the Landlord, and for which our predecessor company is the lessee.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

1 edited+0 added−9 removed0 unchanged

2022 filing

2023 filing

Biggest changeManagement does not believe that there is any pending or threatened proceeding against us, which, if determined adversely, would have a material adverse effect on our business, results of operations or financial condition, except as described below.

Biggest changeItem 3. LEGAL PROCEEDINGS From time to time, we may be party to or otherwise involved in legal proceedings arising in the ordinary course of business. Management does not believe that there is any pending or threatened proceeding against us, which, if determined adversely, would have a material adverse effect on our business, results of operations or financial condition.

Removed

Item 3. LEGAL PROCEEDINGS From time to time, we may be party to or otherwise involved in legal proceedings arising in the ordinary course of business.

Removed

On February 9, 2023, the breach of contract claim brought by Dennis Rodrigues, a former officer and director, was dismissed by the Superior Court of New Jersey in Warren County. Prior to the dismissal, we paid an aggregate of $235,000 pursuant to a settlement agreement we had entered into with the plaintiff.

Removed

The Company is party to an action filed against us on November 29, 2021 by Green City Growers Cooperative in the Court of Common Pleas in Cuyahoga County, Ohio. The plaintiff seeks damages of approximately $600,000 for an alleged breach of a supplier agreement. The Company denies the allegations and filed a counterclaim against the plaintiff on January 3, 2022.

Removed

The Company believes it has meritorious defenses and plans to vigorously defend itself. This action arises from our entry into two agreements with the plaintiff. First, we entered into the Assumption Agreement in May 2021, whereby we assumed a liability of $78,976 that Arch City owed to the plaintiff.

Removed

Second, also in May 2021, we entered into a supplier agreement with the plaintiff (the “Supply Agreement”), under which we agreed to purchase an aggregate of 6.0 million units of herbs and lettuce that were processed by the plaintiff over a three-year period according to agreed-upon prices.

Removed

The plaintiff was one of our suppliers of cut basil, sage, rosemary, thyme and parsley during this time. On August 2, 2021, the plaintiff sent a notice to us terminating the Supply Agreement in accordance with its terms. Following the termination of the Supply Agreement, we do not have any written supply agreements with the plaintiff.

Removed

Management concluded that a loss related to this matter was probable and reasonably estimable as of December 31, 2022. The accrual for the loss contingency totaled $120,000 as of December 31, 2022.

Removed

If we are unsuccessful in defending ourselves from this claim or if our insurer does not insure us against legal costs we incur in excess of our deductible, the result may materially adversely affect our business, results of operations and financial condition.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

1 edited+0 added−0 removed3 unchanged

2022 filing

2023 filing

Biggest changeItem 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Our common shares are listed on the Nasdaq Capital Market under the symbol “EDBL”. As of March 22, 2023, we had 1,618 stockholders of record.

Biggest changeItem 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Our common stock, par value $0.0001 (the “common stock”), is listed on the Nasdaq Capital Market under the symbol “EDBL”. As of March 25, 2024, we had 1,618 stockholders of record.

Item 7. Management's Discussion & Analysis

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

23 edited+52 added−26 removed36 unchanged

2022 filing

2023 filing

Biggest changeThe brand not only lends itself to our current portfolio of products but allows us to develop other products in the “Consumer Brands” category. Our focus on sustainability, traceability, and social contribution, which we define as an ongoing effort to improve employee relations, working conditions, and local communities, presents our value proposition to our customers and supermarket partners and distributors.

Biggest changeOur focus on sustainability, traceability, and social contribution, which we define as an ongoing effort to improve employee relations, working conditions, and local communities, presents our value proposition to our customers and supermarket partners and distributors. 33 Table of Contents RECENT DEVELOPMENTS Departure of Chief Financial Officer; Appointment of Interim Chief Financial Officer Effective January 25, 2024, Michael James retired from his positions as Chief Financial Officer, Treasurer, Secretary and Director of the Company.

Item 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS The following discussion and analysis of our financial condition and results of operations and quantitative and qualitative disclosures should be read in conjunction with our audited consolidated financial statements and related notes included in this Annual Report on Form 10-K for the year ended December 31, 2022.

Our advanced systems are also designed to help mitigate contamination from harmful pathogens, including salmonella, e-coli and others. 29 Table of Contents We have also developed patented software called GreenThumb that assists in tracking plants through our supply chain.

Our advanced systems are also designed to help mitigate contamination from harmful pathogens, including salmonella, e-coli and others. 32 Table of Contents We have also developed patented software called GreenThumb that assists in tracking plants through our supply chain.

We use the controlled environment of traditional greenhouse structures, such as glass greenhouses, together with hydroponic and vertical greenhouses to sustainably grow organic herbs and lettuces. In our hydroponic greenhouse, we grow plants without soil.

The Company’s liquidity needs have been met primarily through public equity offerings, term loan borrowings, convertible notes, and related party loans. As of December 31, 2022 and December 31, 2021, we had $110 thousand and $31 thousand in cash and cash equivalents available, respectively.

The Company’s liquidity needs have been met primarily through public equity offerings, term loan borrowings, convertible notes, and related party loans. 37 Table of Contents As of December 31, 2023 and December 31, 2022, we had $510 thousand and $110 thousand in cash and cash equivalents available, respectively.

LIQUIDITY AND CAPITAL RESOURCES Going Concern Considerations We have incurred significant losses since our inception. We have experienced net losses of approximately $12.453 million during the twelve months ended December 31, 2022 and $5.538 million in the year ended December 31, 2021.

LIQUIDITY AND CAPITAL RESOURCES Going Concern Considerations We have incurred significant losses since our inception. We have experienced net losses of approximately $10.188 million during the twelve months ended December 31, 2023 and $12.453 million in the year ended December 31, 2022.

At December 31, 2022 and December 31, 2021, such net operating losses were offset entirely by a valuation allowance. The Company recognizes uncertain tax positions based on a benefit recognition model.

At December 31, 2023 and December 31, 2022, such net operating losses were offset entirely by a valuation allowance. 35 Table of Contents The Company recognizes uncertain tax positions based on a benefit recognition model.

RECENT DEVELOPMENTS Public Follow-on Offering On February 7, 2023, we closed on an underwritten public offering of 1,619,000 units, with each unit consisting of one share of common stock and one warrant to purchase one share of common stock at an exercise price equal to $6.30 per share.

On February 7, 2023, we closed on an underwritten public offering of units, with each unit consisting of one share of common stock and one warrant to purchase one share of common stock at an exercise price equal to $6.30 per share. Each unit was sold at a public offering price of $6.30 per unit.

CRITICAL ACCOUNTING ESTIMATES The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to use judgment in making estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities, and the reported amounts of revenues and expenses.

The Advance Agreement is collateralized by the Company’s cash and receivable accounts. 34 Table of Contents CRITICAL ACCOUNTING ESTIMATES The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management to use judgment in making estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities, and the reported amounts of revenues and expenses.

Investing activities During the twelve months ended December 31, 2022 and 2021, cash used in investing activities was $2.033 million and $151 thousand, respectively. The increase in cash used in for investing activities was primarily driven by our purchase of Edible Garden Heartland. See Note 3 to our financial statements for more information about this asset acquisition.

Investing activities During the years ended December 31, 2023 and 2022, cash used in investing activities was $1.022 million and $2.033 million, respectively. The decrease in cash used for investing activities was primarily driven by our purchase of Edible Garden Heartland in the prior year. See Note 3 to our financial statements for more information about this asset acquisition.

RESULTS OF OPERATIONS COMPARISON OF THE TWELVE MONTHS ENDED DECEMBER 31, 2022 AND 2021 (in thousands) Year Ended December 31, 2022 Year Ended December 31, 2021 Revenue $ 11,552 $ 10,507 Cost of goods sold 11,188 9,859 Gross Profit 364 648 Selling, general and administrative expenses 9,368 5,611 Loss from operations (9,004 ) (4,963 ) Other income / (expense) Interest expense, net (2,033 ) (617 ) Loss from extinguishment of debt (826 ) 42 Other income / (loss) (590 ) - Total other expenses (3,449 ) (575 ) NET LOSS $ (12,453 ) $ (5,538 ) Revenue Revenue was $11.552 million for the twelve months ended December 31, 2022, an increase of $1.045 million, or 9.95%, compared with $10.507 million for the twelve months ended December 31, 2021.

RESULTS OF OPERATIONS COMPARISON OF THE YEARS ENDED DECEMBER 31, 2023 AND 2022 (in thousands) Year Ended December 31, 2023 Year Ended December 31, 2022 Revenue $ 14,049 $ 11,552 Cost of goods sold 13,227 11,188 Gross Profit 822 364 Selling, general and administrative expenses 10,009 9,368 Impairment loss 686 - Loss from operations (9,873 ) (9,004 ) Other income / (expense) Interest expense, net (390 ) (2,033 ) Gain / (Loss) from extinguishment of debt 70 (826 ) Other income / (loss) 5 (590 ) Total other income (expense) (315 ) (3,449 ) NET LOSS $ (10,188 ) $ (12,453 ) Revenue Revenue was $14.049 million for the year ended December 31, 2023, an increase of $2.497 million, or 21.62%, compared with $11.552 million for the year ended December 31, 2022.

Our ability to fund future operating expenses and capital expenditures and our ability to meet future debt service obligations or refinance our indebtedness will depend on our future operating performance, which will be affected by general economic, financial and other factors beyond our control, including those described under “ Risk Factors ” in this Annual Report on Form 10-K. 34 Table of Contents Capital Resources On May 9, 2022, we completed our IPO and raised net proceeds of approximately $13.2 million, after deducting underwriting discounts and commissions and expenses associated with the offering of approximately $1.4 million.

If we are unable to continue as a going concern, holders of our securities might lose their entire investment. These factors, among others, may make it difficult to raise any additional capital and may cause us to be unable to continue to operate our business.

These factors, among others, may make it difficult to raise any additional capital and may cause us to be unable to continue to operate our business.

Selling, general and administrative Selling, general and administrative (“SG&A”) expenses increased by $3.757 million, or 66.96%, to $9.368 million for the twelve months ended December 31, 2022, compared with $5.611 million for the twelve months ended December 31, 2021.

Selling, general and administrative Selling, general and administrative (“SG&A”) expenses increased by $641 thousand, or 6.84%, to $10.009 million for the year ended December 31, 2023, compared with $9.368 million for the year ended December 31, 2022.

This note is secured by all of the assets the Company purchased from its predecessor. From time to time, the Company enters into loans to purchase vehicles that are secured by the vehicle purchased. Some of these loans are also personally guaranteed by the Company’s chief executive officer and/or chief financial officer.

From time to time, the Company enters into loans to purchase vehicles that are secured by the vehicle purchased. Some of these loans are also personally guaranteed by the Company’s chief executive officer and/or chief financial officer. These loans accrue interest at annual rates ranging from 7.64% to 18.66% and mature on dates between April 2024 and February 2028.

If the total of the future cash flows is less than the carrying amount of those assets, the Company recognizes an impairment loss based on the excess of the carrying amount over the fair value of the assets. 31 Table of Contents Income Taxes The provision for income taxes is determined in accordance with ASC 740, “ Income Taxes .” The Company files a consolidated United States federal income tax return.

As of December 31, 2022 and December 31, 2021, we had working capital deficits of $2.966 million and $5.898 million, respectively. As of December 31, 2022 and December 31, 2021, we had $6.324 million and $8.775 million of total debt outstanding, respectively.

During the year ended December 31, 2023, we used $8.531 million of cash for operating activities. As of December 31, 2023 and 2022, we had working capital deficit of $257 thousand and $2.966 million, respectively. As of December 31, 2023 and December 31, 2022, we had $4.427 million and $6.324 million of total debt outstanding, respectively.

Loss from operations Lower gross margin and higher SG&A resulted in an increase in loss from operations of $3.941 million to $8.904 million for the twelve months ended December 31, 2022, compared with $4.963 million for the twelve months December 31, 2021.

Loss from operations Higher gross profit, offset by higher SG&A costs resulted in an overall increase in loss from operations of $869 thousand to $9.873 million for the year ended December 31, 2023, compared with $9.004 million for the year ended December 31, 2022.

Other income (loss) We incurred a loss of $590 thousand for the twelve months ended December 31, 2022.

Other income (expense) Other income was $5 thousand for the year ended December 31, 2023, compared with other expense of $590 thousand for the year ended December 31, 2022.

Our financial statements have been prepared on a “going concern” basis, which implies we may not continue to meet our obligations and continue our operations for the next twelve months. Our consolidated financial statements do not include any adjustments that might result if we are unable to continue as a going concern.

Our consolidated financial statements do not include any adjustments that might result if we are unable to continue as a going concern. If we are unable to continue as a going concern, holders of our securities might lose their entire investment.

The increase represents growth from our existing customer base. Cost of goods sold Cost of goods sold increased $1.329 million, or 13.48% to $11.188 million for the twelve months ended December 31, 2022, compared with $9.859 million for the twelve months ended December 31, 2021.

Cost of goods sold Cost of goods sold increased $2.039 million, or 18.22% to $13.227 million for the year ended December 31, 2023, compared with $11.188 million for the year ended December 31, 2022.

Financing activities During the twelve months ended December 31, 2022 and 2021, cash provided by financing activities was $11.297 million and $4.255 million. The increase in cash provided by financing activities was primarily driven by completion of the IPO, partially offset by the repayment of indebtedness.

Financing activities During the years ended December 31, 2023 and 2022, cash provided by financing activities was $9.953 million and $11.297 million, respectively.

We may not be able to access the capital markets in the future on commercially acceptable terms or at all.

In addition, in March 2024, we entered into the Advance Agreement and received $1.0 million in cash proceeds by selling $1.491 million of trade receivables to Cedar. See Note 15 to our financial statements for additional details. We may not be able to access the capital markets in the future on commercially acceptable terms or at all.

Removed

Each unit was sold at a public offering price of $6.30 per unit.

Added

The brand not only lends itself to our current portfolio of products but allows us to develop other products in the “Consumer Brands” category.

Removed

Gross proceeds, before deducting underwriting discounts and commissions and estimated offering expenses, were approximately $10.2 million. 30 Table of Contents On February 10, 2023, the Company received a letter from the Listing Qualifications Department of the Nasdaq Stock Market LLC (“Nasdaq”) indicating that the Company had regained compliance with the minimum stockholders’ equity requirement for continued listing on Nasdaq under Nasdaq Rule 5550(b)(1), the publicly held shares requirement under Nasdaq Rule 5550(a)(4), and the minimum bid price requirement under Nasdaq Rule 5550(a)(2).

Added

In connection with Mr. James’s retirement, on January 24, 2024, the Company and Mr. James entered into a separation agreement (the “Separation Agreement”). Pursuant to the terms of the Separation Agreement, the Company agreed to pay Mr. James a severance payment of $300,000 in the form of salary continuation until January 2025. In addition, Mr.

Removed

Nasdaq will continue to monitor the Company’s ongoing compliance with the stockholders’ equity requirement and, if at the time of filing its periodic report for the quarter ending March 31, 2023, the Company does not evidence compliance with that rule, the Company’s common stock may be subject to delisting.

Added

James is eligible to earn milestone payments under the Separation Agreement in an aggregate amount up to $300,000 if he completes certain transitional deliverables for the Company. The Company agreed to grant Mr.

Removed

The increase was due to higher packaging costs due to inflation, higher labor costs due to the tight labor market and increases in rates charged by our contract growers. 32 Table of Contents Gross profit Gross profit declined by $284 thousand, or 43.83%, to $364 thousand, or 2.46% of sales, for the twelve months ended December 31, 2022, compared with $648 thousand, or 6.17% of sales, for the twelve months ended December 31, 2021.

Added

James a restricted stock award with a fair value equal to $25,000 as of the trading day after the date the Company files its Annual Report on Form 10-K for the year ended December 31, 2023. Under the Separation Agreement, Mr. James provided a general release of claims in favor of the Company and its affiliates, subject to customary exceptions.

Removed

Margin contraction was the result of increased costs incurred to fulfill the demand by our customers due to higher packaging and labor costs as well as increased in fees charged by our contract growers.

Added

Effective January 25, 2024, the Board appointed Kostas Dafoulas to serve as the Company’s interim Chief Financial Officer following the retirement of Mr. James.

Removed

Higher compensation and related expense of $1.240 million was driven primarily by $500 thousand transaction bonuses paid to each of our Chief Executive Officer and Chief Financial Officer upon the completion of our initial public offering (the “IPO”) pursuant to their employment agreements.

Added

Equity Distribution Agreement On February 6, 2024, the Company entered into an Equity Distribution Agreement (the “EDA”) with Maxim Group LLC, as sales agent (the “Agent”), pursuant to which the Company may, from time to time, issue and sell shares (the “Shares”) of common stock through the Agent in an at-the-market offering for an aggregate offering price of up to $1,146,893.

Removed

The balance of the increase in compensation expense included $122 thousand of common stock issued to the employees and higher wages required to retain talent and expanding the workforce to support growth initiatives.

Added

Under the terms of the EDA, the Agent may sell the Shares at market prices by any method that is deemed to be an “at-the-market offering” as defined in Rule 415 under the Securities Act.

Removed

Approximately $877 thousand of the increase in SG&A was associated with becoming a public company, including obtaining a Directors and Officers liability insurance policy, investor relations support and audit and quarterly financial review expenses. Director fees increased by $204 thousand, comprised of $134 thousand paid in cash and the issuance of common stock valued at $70 thousand.

Added

The offering of shares of our common stock pursuant to the EDA will terminate upon the earliest of (i) February 6, 2025, (ii) the sale of all Shares provided for in the EDA, and (iii) the termination of the EDA by written notice of the Company or the Agent.

Removed

Repairs and maintenance increased by $191 thousand as a result of maintaining the condition of the Belvidere, New Jersey greenhouse. Other professional fees increased by $436 thousand for work performed by outside experts and legal expenses for settling the matter with Green City Growers.

Added

To date, the Company has received net proceeds of $122,118 from the sale of common stock under the EDA after deducting the Agent’s commission of 3.5% of the gross proceeds and other offering expenses. Supply Agreements On February 8, 2024, the Company and Meijer Distribution, Inc.

Removed

Depreciation expense increased by $244 thousand due to the acquisition of Edible Garden Heartland and the purchase of additional trucks. Travel expense increased by $86 thousand for business development and performing due diligence on greenhouse locations for potential acquisitions.

Added

(“Buyer”) entered into two agreements pursuant to which the Company will supply and sell products to Buyer until December 2026 (the “Supply Agreements”).

Removed

Interest expense Interest expense was $2.033 million for the twelve months ended December 31, 2022, versus $617 thousand for the twelve months ended December 31, 2021. The increase was primarily due to additional expense of $552 thousand for amortization of debt discounts in the current year.

Added

Under the Supply Agreements, the Company will sell (i) fresh cut herbs, including basil, bay leaves, chives, cilantro, dill, mint, oregano, rosemary, sage, thyme; (ii) hydroponic basil; and (iii) potted herbs, including basil, chives, cilantro, mint, oregano, parsley, rosemary, sage, thyme, wheatgrass; in quantities and delivery schedule requested by the Buyer at prices per unit set in advance.

Removed

Interest expense relates to the seller financing notes for the acquisition of Edible Garden Heartland, loans provided by an officer for working capital, bridge loans from Evergreen Capital Management, LLC (“Evergreen”) for working capital prior to the IPO, and the notes held by Sament. See Note 8 to our financial statements for more information regarding our notes payable.

Added

Under the Supply Agreements, the Company and the Buyer will renegotiate the prices for each unit annually, provided that the price per unit will not increase or decrease at a rate greater than the change in the relevant Consumer Price Index in that year. Once set, the pricing terms will remain fixed for the remainder of the year.

Removed

Loss from extinguishment of debt We incurred a loss from the extinguishment of debt of $829 thousand as a result of consolidating our debt and entering into an amended and restated consolidated secured promissory note (the “A&R Note”) with Evergreen in June of 2022, compared with a gain of $42 thousand for the twelve months ended December 31, 2021.

Added

Any price increases will take affect after sixty days and any price decrease will be effective immediately. If the Company and the Buyer are unable to mutually agree on price increases, the Company will have the power to terminate the Supply Agreements immediately.

Removed

The revaluation of the warrants issued to Evergreen (as a result of the exercise prices being reduced to the public offering price in May of 2022) was $186 thousand of the loss while $401 thousand was due to a leak out provision for stock owned by Evergreen. 33 Table of Contents Net loss Net loss was $12.453 million for the twelve months ended December 31, 2022, compared with a net loss of $5.538 million for the twelve months ended December 31, 2021.

Added

Under the Supply Agreements, the Company agreed to fund the installation of fixtures in each of the Buyer’s stores to display potted herbs in an aggregate amount estimated to be approximately $800,000. These payments will be made as a weekly deduction from the Company’s receivables from the Buyer. The Supply Agreements will expire on December 31, 2026.

Removed

Obtaining commercial loans, assuming those loans would be available, would increase our liabilities and future cash commitments.

Added

The Supply Agreements may be renewed for an additional two-year term upon the mutual agreement but may be terminated by the Buyer without cause upon sixty days’ prior notice.

Removed

To resolve our working capital deficit and meet our cash needs, we are implementing cost savings programs in addition to having raised $10.2 million from the sale of securities in February 2023.

Added

Sale of Accounts Receivable On March 14, 2024, the Company entered into the Advance Agreement with Cedar, pursuant to which the Company agreed to sell $1,491,000 of trade receivables to Cedar in exchange for $1,000,000 of cash proceeds, after deducting $50,000 for underwriting fees and other transaction expenses.

Removed

In February 2023, we paid off the secured promissory note in the amount of $677 thousand held by Sament and the A&R Note in the amount of $1.022 million. We believe that the remaining offering proceeds will be sufficient to fund our operations through December 2023.

Added

Weekly, the Company is required to pay Cedar 25.0% of all funds collected from customers for the sale of goods and services.

Removed

Subsequent to December 31, 2022, we raised total net proceeds of approximately $9.5 million, after deducting underwriting discounts and commissions and expenses associated with the offering of approximately $0.8 million. On August 30, 2022, we entered into the Greenleaf Promissory Note for $1,136,000, which provided seller financing in connection with the purchase of Edible Garden Heartland.

Added

Weekly, Cedar is authorized to withdraw $53,250 of funds from Edible Garden’s bank account until such time a reconciliation is provided calculating the 25.0% of collections owed to Cedar, until such time the total balance of $1,491,000 is repaid.

Removed

The Greenleaf Promissory Note accrues interest at a rate of 5% per annum and will mature on September 1, 2026. The Company may prepay the outstanding amount due under the Greenleaf Promissory Note at any time without penalty.

Added

Income Taxes The provision for income taxes is determined in accordance with ASC 740, “ Income Taxes .” The Company files a consolidated United States federal income tax return.

Removed

The Company will make monthly payments of principal and interest of $28,089 beginning January 1, 2023 and until the maturity date of the Greenleaf Promissory Note. The Greenleaf Promissory Note is secured by a mortgage on the Property (the “Mortgage”) and a security interest in the assets owned by the Subsidiary in favor of NJDI (the “Security Agreement”).

Added

The increase was attributed to an increase of $2.17 million in sales of our herb, produce and floral products, driven by a mix of organic growth and new customers. Additionally, sales of our vitamins and supplements increased $324 thousand during the year ended December 31, 2023, driven by consumer demand.

Removed

In addition, the Company’s obligation to repay the amounts due under the Promissory Note, or up to $1,136,000 plus any accrued interest, is guaranteed by the Company under a guaranty in favor of NJDI (the “Guaranty”) entered into on August 30, 2022.

Added

The increase was primarily due to $2.59 million of higher costs for operating the Edible Heartland facility, which transitioned to growing our herbs and lettuce products during 2023.

Removed

Under the Guaranty, in the event that the Company defaulted on the Greenleaf Promissory Note, the Company would be responsible for any sum remaining due after NJDI foreclosed on the Mortgage and exercised its rights under the Security Agreement. On June 22, 2020, the Company entered into a U.S.

Added

Additionally, we incurred an additional $70 thousand of fuel and automobile expenses, $42 thousand of additional labor costs, and $35 thousand of additional cost related to our Pulp brand products, which we began selling during 2023.

Removed

Small Business Administration Loan Authorization and Agreement pursuant to which the Company received loan proceeds of $150,000 (the “SBA Loan”). The SBA Loan matures on June 22, 2050 and incurs interest at a fixed rate of 3.75% per year.

Added

These increases were offset by a decline of $264 thousand of costs for supplies and raw materials for our Edible Garden flagship facility and a $377 thousand decrease in freight and shipping costs.

Removed

On March 30, 2020, the Company issued a promissory note to Sament, an affiliate of our predecessor, for $3.0 million when the Company purchased the assets of its predecessor. This note accrues interest at a fixed rate of 3.5% per year on a 360-day year basis and matures March 30, 2025.

Added

Gross profit Gross profit increased by $458 thousand, or 125.82%, to $822 thousand, or 5.85% of sales, for the year ended December 31, 2023, compared with $364 thousand, or 3.15% of sales, for the year ended December 31, 2022. Improvement in margins was primarily attributed to less reliance on contract growers in 2023 versus 2022.

Removed

These loans accrue interest at annual rates ranging from 7.64% to 18.66% and mature on dates between April 2024 and July 2027. For more information on our outstanding debt as of December 31, 2022 and December 31, 2021, see Note 8 to our financial statements.

Added

The increase was driven by $868 thousand of additional costs incurred to operate the Edible Garden Heartland facility, comprised primarily of $362 thousand for compensation and benefits, $194 thousand for utilities and facility maintenance, $177 thousand for equipment and vehicle repairs and maintenance, and $80 thousand paid for property taxes.

Removed

Cash Flows Operating activities During the twelve months ended December 31, 2022 and 2021, cash used for operating activities was $9.185 million and $4.078 million, respectively. Cash expenditures for the twelve months ended December 31, 2022 increased primarily due to the increase in net loss, timing of vendor payments and an increase in executive and directors’ compensation.

Added

Additionally, during the year ended December 31, 2023, we incurred $530 thousand of additional depreciation and amortization expenses, a $100 thousand increase in offering expenses, $150 thousand increase for public relations, $110 thousand of additional proxy expenses and $100 thousand of additional transfer agent expenses.

Added

We also saw an increase of $206 thousand of expense for license fees, insurance and taxes. These increases were offset by a decrease of $1.28 million of compensation (including stock compensation), benefits and professional fees, which was primarily driven by $1.0 million of bonuses paid during 2022 upon completion of our initial public offering.

Added

Additionally, repair and maintenance expenses and facility-related expenses for our Flagship Facility decreased $125 thousand and $29 thousand respectively. 36 Table of Contents Impairment Loss During the year ended December 31, 2023, management completed an impairment analysis and recorded an impairment loss of $686 thousand for certain fixed assets acquired from our predecessor company, Edible Garden Corp.

Added

This loss reflects the difference between the previous book value of the assets and the estimated salvage value. See Note 5 to our financial statements.

Added

Interest expense Interest expense was $390 thousand for the year ended December 31, 2023, versus $2.033 million for the year ended December 31, 2022. Lower interest expense was related to paying off debt previously outstanding with proceeds from our public offerings. See Note 8 to our financial statements.

Added

Loss from extinguishment of debt During the year ended December 31, 2023, the Company recognized a gain from the extinguishment of debt of $70 thousand by prepaying a promissory note owed to Sament Capital Investments (“Sament”).

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Top changes in Edible Garden AG Inc's 2023 10-K

Item 1. Business

Item 1A. Risk Factors

Item 2. Properties

Item 3. Legal Proceedings

Item 5. Market for Registrant's Common Equity

Item 7. Management's Discussion & Analysis

Other EDBL 10-K year-over-year comparisons