What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2025-04-15 compared with 2024-04-01 · 949 added, 780 removed, 589 unchanged (75% of the section changed)

Financial Statements and Supplementary Data

FINANCIAL STATEMENTS

THE YEARS ENDED DECEMBER 31, 2024 AND 2023

Report of Independent Registered Public Accounting Firm, M&K CPAS, PLLC (PCAOB ID:

of Independent Registered Public Accounting Firm, M&K CPAS, PLLC (PCAOB ID:

Balance Sheets as of December 31, 2024 and 2023

Statements of Operations for the years ended December 31, 2023 and 2022

Statement of Stockholders’ Equity (Deficit) for the years ended December 31, 2023 and 2022

Statements of Operations and Comprehensive Loss for the years ended December 31, 2024 and 2023

Statement of Stockholders’ Equity for the years ended December 31, 2024 and 2023

Statements of Cash Flows for the years ended December 31, 2024 and 2023

Notes to Financial Statements

to Consolidated Financial Statements

OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

the Board of Directors and Stockholders of

BranchOut Food Inc.

on the Financial Statements

have audited the accompanying balance sheets of BranchOut Food, Inc.

(the Company) as of December 31, 2023 and 2022, and the related

statements of operations, stockholders’ equity (deficit), and cash flows for each of the years in the two-year period ended December

31, 2023, and the related notes (collectively referred to as the “financial statements”).

In our opinion, the financial statements

present fairly, in all material respects, the financial position of the Company as of December 31, 2023 and 2022, and the results of

its operations and its cash flows for each of the years in the two-year period ended December 31, 2023 in conformity with accounting

principles generally accepted in the United States of America.

the Board of Directors and Stockholders

on the Consolidated Financial Statements

We have audited the accompanying consolidated balance sheets of BranchOut Food, Inc.

(the Company) as of December 31, 2024 and 2023, and the related consolidated statements of operations and comprehensive loss, stockholders’ equity, and cash flows for the years ended December 31, 2024 and 2023, and the related notes (collectively referred to as the “financial statements”).

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for the years ended December 31, 2024 and 2023, in conformity with accounting principles generally accepted in the United States of America .

accompanying financial statements have been prepared assuming the Company will continue as a going concern.

As discussed in Note 2 to

the financial statements, the Company has incurred recurring losses from operations and had a working capital deficit and a stockholders’

deficit as of December 31, 2023 which raises substantial doubt about its ability to continue as a going concern.

Management’s plans

regarding these matters are also described in Note 2.

The financial statements do not include any adjustments that might result from

the outcome of this uncertainty.

As discussed in Note 2

to the financial statements, the Company has incurred recurring losses from operations resulting in an accumulated deficit, and had a

working capital deficit as of December 31, 2024 which raises substantial doubt about its ability to continue as a going concern.

Management’s plans regarding these matters are also described in Note 2.

The financial statements do not include any

adjustments that might result from the outcome of this uncertainty.

financial statements are the responsibility of the Company’s management.

21 unchanged sentences

a reasonable basis for our opinion.

Critical Audit Matter

critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated

5 unchanged sentences

matter below, providing separate opinions on the critical audit matter or on the accounts or disclosures to which it relates.

Stock and Other Equity Accounts

discussed in Note 19 and Note 20, the Company issued stock options to purchase common stock to employees and an officer of the Company

and the Company issued warrants with notes payable to third parties.

Auditing management’s calculation of the fair value of the

stock options and the warrants issued can be a significant judgment due to the need of a specialist to evaluate the fair value of the

stock options and warrants issued and the auditor has to test the inputs and estimates used.

management’s calculation of the fair value of the stock options and warrants issued can be a significant judgment given the fact

that the Company uses management estimates on various inputs to the calculations.

evaluated management’s conclusions regarding their fair values and reviewed support for the significant inputs used in the valuation

model, as well as assessing the model for reasonableness.

In addition, we evaluated the Company’s disclosures in relation to this

matter included in Note 19 and Note 20 to the financial statements.

Going Concern

Due to the net loss for the year, the Company evaluated

the need for a going concern.

Auditing management’s evaluation of a going

concern can be a significant judgement given the fact that the Company uses management estimates on future revenues and expenses which

are not able to be substantiated.

As discussed in Note 2, the Company has a going concern

due to recurring net losses from operations resulting in an accumulated deficit and working capital at December 31, 2024.

To evaluate the appropriateness of the going concern,

we examined and evaluated the financial information along with management’s plans to mitigate the going concern and management’s

disclosure on going concern.

M&K CPAS, PLLC

PCAOB ID 2738

have served as the Company’s auditor since 2021.

The Woodlands,

Woodlands, TX

BALANCE SHEETS

Current assets:

Accounts receivable

Accounts receivable, net

Advances on inventory purchases

1 unchanged sentence

Total current assets

Restricted cash

Deferred offering costs

Property and equipment, net

Right-of-use asset

Right-of-use assets

Note receivable

Liabilities and Stockholders’ Equity (Deficit)

Liabilities and Stockholders’

Current liabilities:

Accounts payable

Accounts payable, related parties

Accounts payable

Accrued expenses

Convertible notes payable, related parties

Convertible notes payable, unrelated parties

Other current liabilities

Convertible notes payable,

Notes payable, current portion

Revolving line of credit

Lease liability, current portion

related parties, net of discounts

Notes payable, current

Notes payable, related

Notes payable, current

Finance lease liability,

current portion

Total current liabilities

Notes payable, net of current portion

Lease liability, net of current portion

Operating lease liability, net of current portion

Finance lease liability,

net of current portion

Total Liabilities

Stockholders’ Equity (Deficit):

Preferred stock, $ 0.001 par value, 8,000,000 shares authorized;

Stockholders’ Equity:

Preferred stock, $ 0.001

par value, 8,000,000 shares authorized;

no shares issued and outstanding

Common stock, $ 0.001 par value, 80,000,000 shares authorized;

Common stock, $ 0.001 par

value, 80,000,000 shares authorized;

8,424,600 and 4,044,252 shares issued and outstanding at December 31, 2024 and 2023, respectively

Additional paid-in capital

Accumulated other comprehensive

Accumulated deficit

1 unchanged sentence

( 12,810,541 )

Total Stockholders’ Equity (Deficit)

( 5,139,728 )

Total Liabilities and Stockholders’ Equity (Deficit)

Total Stockholders’

Total Liabilities and

Stockholders’ Equity

accompanying notes are an integral part of these financial statements.

OF OPERATIONS

STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

For the Years Ended

Cost of goods sold

profit (loss)

Operating expenses:

General and administrative

Salaries and wages

Professional fees

Depreciation expense

Total operating expenses

and administrative

operating expenses

Operating loss

3 unchanged sentences

Interest income

Interest expense

other income (expense)

$ ( 4,751,516 )

Total other income (expense)

$ ( 3,925,710 )

Other comprehensive loss:

on foreign currency translation

Net other comprehensive

$ ( 4,760,097 )

$ ( 3,925,710 )

Weighted average common shares outstanding - basic and diluted

Net loss per common share - basic and diluted

Weighted average common

shares outstanding - basic and diluted

Net loss per common

share - basic and diluted

accompanying notes are an integral part of these financial statements.

OF STOCKHOLDERS’ EQUITY (DEFICIT)

Equity (Deficit)

Preferred Stock

STATEMENT OF STOCKHOLDERS’ EQUITY

Comprehensive

Stockholders’

Equity (Deficit)

Balance, December 31, 2022

1 unchanged sentence

$ ( 5,139,728 )

Modification of derivatives

Fair value of warrants issued as debt discounts

Modification of warrants

Common stock sold for cash

Common stock issued pursuant to initial public

Common stock issued for services

Amortization of stock options issued for services

Stock options issued for services

Common stock issued for debt conversions

Common stock warrants granted to note holders

pursuant to debt financing

( 3,925,710 )

3 unchanged sentences

$ ( 12,810,541 )

$ ( 8,884,831 )

$ ( 5,139,728 )

Common stock issued pursuant to initial public offering, net of offering costs

Common stock issued pursuant to secondary public

Common stock issued pursuant to ATM program

- Authorized shares, 1,500,000 shares

- Unissued shares, 182,693 shares

Common stock units sold to related parties

Common stock issued for services

Stock options issued for services

Common stock issued for debt conversions

Common stock warrants granted to note holders pursuant to debt financing

Common stock warrants granted to note holders

pursuant to debt financing

Amended warrants

Loss on foreign currency translation

( 4,751,516 )

4 unchanged sentences

accompanying notes are an integral part of these financial statements.

OF CASH FLOWS

STATEMENTS OF CASH FLOWS

For the Years Ended

Cash flows from operating activities

Cash flows from operating

$ ( 4,751,516 )

$ ( 3,925,710 )

Adjustments to reconcile net loss to net cash used in operating activities:

Adjustments to reconcile

net loss to net cash used in operating

Bad debts expense

Depreciation expense

1 unchanged sentence

Impairment of assets

Common stock issued for services

Options and warrants issued for services

Common stock issued for

Options and warrants issued

Amended warrants

Decrease (increase) in assets:

Decrease (increase) in

Accounts receivable

Advances on inventory purchases

( 1,593,730 )

Other current assets

Right-of-use asset

Increase (decrease) in liabilities:

( 1,947,483 )

Increase (decrease) in

Accounts payable

Accounts payable, related parties

Accounts payable, related

Accrued expenses

Net cash used in operating activities

Operating lease liability

Net cash used in operating

( 4,859,816 )

( 3,529,372 )

Cash flows from investing activities

Payments received on notes receivable

Purchase of property and equipment

Net cash used in investing activities

Cash flows from financing activities

Payment of deferred offering costs

Proceeds received on convertible notes payable, related parties

Proceeds received on convertible notes payable, unrelated parties

Repayments on convertible notes payable

Proceeds received on notes payable

Cash flows from investing

Purchase of property and

( 2,847,207 )

Payments received on notes

Net cash used in investing

( 2,822,561 )

Cash flows from financing

Payment of deferred offering

Proceeds received on convertible

notes payable, related parties

Proceeds received on convertible

notes payable, unrelated parties

Proceeds received on notes

Repayment of notes payable

( 2,420,000 )

Proceeds received on revolving line of credit

Repayments on revolving line of credit

Principal payments on finance lease

Proceeds from sale of common stock

Net cash provided by financing activities

Proceeds received on notes

payable, related parties

Repayment of notes payable,

related parties

Repayments on revolving

line of credit

Principal payments on finance

Proceeds from sale of common

Net cash provided by financing

Effect of exchange rate

changes on cash

Net increase in cash

Cash and restricted cash - beginning of period

Cash - beginning of period

Cash - ending of period

3 unchanged sentences

Non-cash investing and financing transactions:

Value of warrants issued as a debt discount

Value of shares issued on debt conversions

Initial recognition of right-of-use assets and lease liabilities

Modification of derivative liabilities

Equipment purchased with

debt financing

Relative fair value of

warrants issued as a debt discount

Relative fair value of

shares issued on debt conversions

Initial recognition of

right-of-use assets and lease liabilities

accompanying notes are an integral part of these financial statements.

TO FINANCIAL STATEMENTS

TO CONSOLIDATED FINANCIAL STATEMENTS

1 – Nature of Business

4 unchanged sentences

The Company is engaged in the development, marketing, sale, and distribution of plant-based, dehydrated fruit and vegetable snacks and

The Company’s products are currently manufactured for it by two contract manufacturers, one based in Chile and the other

in Peru, where BranchOut’s continuous through-put dehydration machine is located.

Our manufacturers produce products for us using

a new proprietary dehydration technology licensed by the Company.

The Company’s customers are primarily located throughout the

United States.

The Company’s products are currently manufactured at its new production facility that commenced production in Pisco Peru

in December 2024, and is supported by contract manufacturers, as necessary.

The Company’s products are manufactured using a new

proprietary dehydration technology licensed by the Company.

The Company’s customers are primarily located throughout the United

2 – Basis of Presentation

11 unchanged sentences

fair presentation of the information contained therein.

of Consolidation

accompanying consolidated financial statements include the accounts of the following entities, all of which were under common control

and ownership at December 31, 2024:

Food Sucursal Peru (2)

company in the form of a corporation.

wholly-owned subsidiary of BranchOut Food Inc.

in the form of a branch.

consolidated financial statements herein contain the operations of the wholly-owned subsidiary listed above.

The Company’s headquarters

are located in Bend, Oregon.

Public Offering

11 unchanged sentences

of Common Stock at an exercise price of $ 7.20 , which may be exercised for a five-year period beginning December 18, 2023.

TO CONSOLIDATED FINANCIAL STATEMENTS

to the IPO, all deferred offering costs were capitalized in other noncurrent assets on the balance sheets.

1 unchanged sentence

$ 1,283,954 , primarily consisting of accounting, legal, and other fees related to the Company’s IPO, were offset against the IPO

proceeds upon the closing of the Company’s IPO in June 2023.

As of December 31, 2023, all deferred offering costs were paid.

deferred offering costs totaled $ 543,664 as of December 31, 2022.

proceeds upon the closing of the IPO in June 2023.

June 15, 2023, the Company effected a 2.5-for-1 reverse stock split of its outstanding shares of capital stock.

5 unchanged sentences

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

TO FINANCIAL STATEMENTS

shown in the accompanying financial statements, the Company has incurred recurring losses from operations resulting in an accumulated

deficit of $ 12,810,541 , and working capital of $ 899,150 as of December 31, 2023, and the Company’s cash on hand may not be sufficient

to sustain operations.

These factors raise substantial doubt about the Company’s ability to continue as a going concern.

is actively pursuing new customers to increase revenues.

In addition, the Company is currently seeking additional sources of capital

to fund short term operations.

deficit of $ 17,562,057 , and a working capital deficit of $ 3,897,382 as of December 31, 2024.

The Company’s $ 2,329,452 of cash on

hand at December 31, 2024 may not be sufficient to sustain operations.

These factors raise substantial doubt about the Company’s

ability to continue as a going concern.

Subsequent to December 31, 2024, the Company received gross proceeds of approximately $ 2.5 million

from sales of common stock in an “At-the-Market” registered offering.

Although the Company anticipates that its results of

operations will improve substantially as a result of the recent launch of its new facility in Peru, there can be no assurance in that

Management is actively pursuing new customers to increase revenues.

In addition, the Company is currently seeking additional

sources of capital to fund short term operations.

Management believes these factors will contribute toward achieving profitability.

The accompanying financial

statements do not include any adjustments that might be necessary if the Company is unable to continue as a going concern.

accompanying financial statements do not include any adjustments that might be necessary if the Company is unable to continue as a going

financial statements do not include any adjustments that might result from the outcome of any uncertainty as to the Company’s ability

8 unchanged sentences

Actual results could differ from these estimates.

280, Segment Reporting , requires annual and interim reporting for an enterprise’s operating segments and related disclosures

about its products, services, geographic areas and major customers.

An operating segment is defined as a component of an enterprise that

engages in business activities from which it may earn revenues and expenses, and about which separate financial information is regularly

evaluated by the chief operating decision maker in deciding how to allocate resources.

The Company operates as a single segment and will

evaluate additional segment disclosure requirements as it expands its operations.

ASC 280, Segment Reporting , operating segments are defined as components of an enterprise where discrete financial information

is available that is evaluated regularly by the chief operating decision maker (“CODM”), in deciding how to allocate resources

and in assessing performance.

The Company has two components, consisting of its sales operations in the United States, and its production

operations in Peru.

Therefore, the Company’s Chief Executive Officer, who is also the CODM, makes decisions and manages the Company’s

operations based on these two operating segments for the manufacture and distribution of its products.

Value of Financial Instruments

5 unchanged sentences

would use in pricing the asset or liability and are developed based on the best information available in the circumstances.

TO CONSOLIDATED FINANCIAL STATEMENTS

820 identifies fair value as the exchange price, or exit price, representing the amount that would be received to sell an asset or paid

13 unchanged sentences

of any input that is significant to the fair value measurement.

TO FINANCIAL STATEMENTS

and Cash Equivalents

9 unchanged sentences

the Federal Deposit Insurance Corporation (“FDIC”) up to $ 250,000 , under current regulations.

The Company had $ 407,789 and

$ 62,697 in excess of FDIC insured limits on December 31, 2023 and 2022, respectively, and has not experienced any losses in such accounts.

The Company had $ 1,555,223

and $ 407,789 in excess of FDIC insured limits on December 31, 2024 and 2023, respectively, and has not experienced any losses in such

receivable is carried at their estimated collectible amounts.

1 unchanged sentence

based on past credit history with customers and their current financial condition.

The Company had no allowance for doubtful accounts

on December 31, 2023 and 2022.

The Company had an allowance for doubtful accounts

of $ 25,586 at December 31, 2024.

No allowance for doubtful accounts was necessary at December 31, 2023.

Company’s products consist of pre-packaged and bulk-dried fruit and vegetable-based snacks, powders and ingredients purchased from

11 unchanged sentences

Finished goods

Total inventory

Company had prepaid inventory advances on product in the amount of $ 29,500 as of December 31, 2022.

Advances of 70 % of estimated finish

product costs are made to enable manufacturer’s purchase of raw materials to produce finished products.

The remaining 30 % is paid

upon receipt of finished goods.

Company had prepaid inventory advances on products in the amount of $ 123,792 and $- 0 - as of December 31, 2024 and 2023, respectively.

Advances of 70 % of estimated finish product costs are made to enable manufacturer’s purchase of raw materials to produce finished

The remaining 30 % is paid upon receipt of finished goods.

TO CONSOLIDATED FINANCIAL STATEMENTS

and Equipment

13 unchanged sentences

expense was $ 171,873 and $ 223,856 for the years ended December 31, 2024 and 2023, respectively.

TO FINANCIAL STATEMENTS

For the year ended, December 31, 2024,

a total of $ 34,034 of depreciation was included in the inventoried production costs, which gets expensed as Cost of Goods Sold as the

inventory is sold.

of Long-Lived Assets

13 unchanged sentences

internally developed trademarks.

2021, the Company entered into a license agreement to license the rights to certain production equipment developed and manufactured by

another company through the purchase of that company’s equipment.

The license is not discernable from the equipment;

the license costs have been capitalized and depreciated over the useful life of the equipment.

The license agreement also entitles the

licensor to a royalty on all revenue from the sale of products produced using the equipment.

These royalties are recognized as royalty

expenses as the products are sold.

There have been no royalty payments to date, and any future minimum royalty payments or equipment

purchases under this license agreement are an unrecognized commitment as they relate to retaining exclusivity of the avocado products

going forward and the Company can elect not to pay as disclosed in Note 17, below.

Company is party to a license agreement under which it is licensed to utilize certain technology and production equipment developed and

manufactured by another company, relating on an exclusive basis to avocado products and on a non-exclusive basis to other products.

license is not discernible from the equipment;

therefore, the license costs have been capitalized and depreciated over the useful life

of the equipment.

The license agreement also entitles the licensor to a royalty on all revenue from the sale of products produced using

the equipment.

These royalties are recognized as royalty expenses as the products are sold.

There was a total of $ 41,673 of royalty payments

made during the year ended December 31, 2024, and no ne during the year ended December 31, 2023.

Any future minimum royalty payments or

equipment purchases under this license agreement are an unrecognized commitment as they relate to retaining exclusivity of the avocado

products going forward and the Company can elect not to pay as disclosed in Note 17 to the financial statements included in this 10-K.

Company evaluates convertible notes payable, stock options, stock warrants and other contracts to determine if those contracts or embedded

10 unchanged sentences

to a liability account at the fair value of the instrument on the reclassification date.

TO CONSOLIDATED FINANCIAL STATEMENTS

Company recognizes revenue in accordance with ASC 606, Revenue from Contracts with Customer .

17 unchanged sentences

on industry-based historical data, historical sales returns, if any, analysis of credit memo data, and other factors known at the time.

TO FINANCIAL STATEMENTS

Company’s sales are predominantly generated from the sale of finished products to retailers, and to a lesser extent, direct to

19 unchanged sentences

Gross revenue

slotting, discounts, and allowances

slotting, discounts,

and allowances

of Goods Sold

9 unchanged sentences

Company issued stock-based compensation in the amount of $ 704,699 and $ 258,574 for the years ended December 31, 2024 and 2023, respectively.

TO CONSOLIDATED FINANCIAL STATEMENTS

and Diluted Loss Per Share

8 unchanged sentences

likely than not.

TO FINANCIAL STATEMENTS

Tax Positions

22 unchanged sentences

which are not yet effective, will not have a material impact on the Company’s financial statements upon adoption.

July 2023, the FASB issued Accounting Standards Update (“ASU”) 2023-03 to amend various SEC paragraphs in the Accounting

Standards Codification to primarily reflect the issuance of SEC Staff Accounting Bulletin No.

2023-03, “ Presentation

of Financial Statements (Topic 205), Income Statement—Reporting Comprehensive Income (Topic 220), Distinguishing Liabilities from

Equity (Topic 480), Equity (Topic 505), and Compensation—Stock Compensation (Topic 718):

Amendments to SEC Paragraphs Pursuant

to SEC Staff Accounting Bulletin No.

120, SEC Staff Announcement at the March 24, 2022 EITF Meeting, and Staff Accounting Bulletin Topic

6.B, Accounting Series Release 280—General Revision of Regulation S-X:

Income or Loss Applicable to Common Stock.

2023-03 amends the ASC for SEC updates pursuant to SEC Staff Accounting Bulletin No.

SEC Staff Announcement at the March 24, 2022

Emerging Issues Task Force (“EITF”) Meeting;

and Staff Accounting Bulletin Topic 6.B, Accounting Series Release 280 - General

Revision of Regulation S-X:

Income or Loss Applicable to Common Stock.

These updates were immediately effective and did not have a significant

impact on our financial statements.

Adopted Accounting Standards

November 2023, the FASB issued Accounting Standards Update (“ASU”) No.

2023-07, “S egment Reporting (Topic 280):

Improvements to Reportable Segment Disclosure.

” The ASU updated reportable segment disclosure requirements, primarily through

requiring enhanced disclosures about significant segment expenses and information used to assess segment performance.

The Company adopted

2023-07 during the year ended December 31, 2024.

See Note 22 “ Segment Reporting ” in the accompanying Notes

to the Consolidated Financial Statements for additional information.

Standards Not Yet Adopted

December 2023, the FASB issued ASU 2023-09, “ Income Taxes (Topic 740):

Improvements to Income Tax Disclosures” .

amendments in this ASU add specific requirements for income tax disclosures to improve transparency and decision usefulness.

in ASU 2023-09 requires that public business entities disclose specific categories in the income tax rate reconciliation and provide

additional qualitative information for reconciling items that meet a quantitative threshold.

In addition, the amendments in ASU 2023-09

require that all entities disclose the amount of income taxes paid disaggregated by federal, state, and foreign taxes and disaggregated

by individual jurisdictions.

The ASU also includes other disclosure amendments related to the disaggregation of income tax expense between

federal, state and foreign taxes.

For public business entities, the amendments in this update are effective for annual periods beginning

after December 15, 2024.

Early adoption is permitted for annual financial statements that have not yet been issued or made available

for issuance.

The amendments in this update should be applied on a prospective basis and retrospective application is permitted.

Company is currently evaluating this ASU to determine its impact on the Company’s disclosures.

TO CONSOLIDATED FINANCIAL STATEMENTS

November 2024, the FASB issued Accounting Standards Update (“ASU”) 2024-03 and in January 2025, the FASB issued ASU 2025-01,

“ Income Statement - Reporting Comprehensive Income -Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of

Income Statement Expenses.

” The guidance requires disclosures about specific expense categories, including but not limited

to, purchases of inventory, employee compensation, depreciation, amortization and selling expenses.

The ASU is effective in the first

annual reporting period beginning after December 15, 2026, and for interim periods within annual reporting periods beginning after December

The Company is currently assessing the effect that adoption of this guidance will have on its Consolidated Financial Statements.

4 – Related Party Transactions

of December 31, 2022, the Company owed Chase Innovations, Inc., a company owned by owned by our

then Chief Financial Officer , Douglas Durst, $ 40,140 for services rendered through the year ended December 2022.

Notes Payable

disclosed in Note 12, below, on January 5, 2023, the Company sold an unsecured convertible promissory note to the Chief Executive Officer’s

Carol Healy, bearing interest at 8 % per annum, in the face amount of $ 25,000 .

The note was convertible at a

fixed conversion price of $ 4.125 per common share.

On June 15, 2023, the note, consisting of $ 25,000 of principal and $ 800 of interest,

was converted into 6,255 shares of common stock.

disclosed in Note 12, below, the Company’s then Chief Financial Officer, Douglas Durst, held an unsecured convertible promissory

note in the face amount of $ 90,000 , as outstanding at September 30, 2023 and December 31, 2022.

The note was convertible at a fixed conversion

price of $ 4.125 per common share.

On June 15, 2023, the note, consisting of $ 90,000 of principal and $ 6,362 of interest, was converted

into 23,361 shares of common stock.

disclosed in Note 12, below, the Company’s then Chief Financial Officer, Chris Coulter, held an unsecured convertible promissory

note in the face amount of $ 50,000 that was outstanding at December 31, 2022.

The note was convertible at a fixed conversion price of

$ 4.125 per common share.

On June 15, 2023, the note, consisting of $ 50,000 of principal and $ 7,525 of interest, was converted into 13,946

shares of common stock.

TO FINANCIAL STATEMENTS

January 10, 2022, the Company sold 1,213 shares of common stock to the Company’s Controller at $ 4.125 per share for proceeds of

Stock Issued for Services

October 26, 2023, the Company issued 12,500 shares, restricted in accordance with Rule 144, to a consultant, who later became a Company

director, for services performed.

The aggregate fair value of the shares was $ 19,000 , based on the

closing traded price of the common stock on the date of grant .

Convertible Note

July 15, 2024, the Company entered into a Securities Purchase Agreement (as amended, the “SPA”) with Daniel L.

Kaufman, pursuant

Kaufman agreed to purchase from the Company, in a private placement (i) a 12 % Senior Secured Convertible Promissory Note

in the principal amount of up to $ 3,400,000 (the “Convertible Note”), convertible into shares of the Company’s common

stock at a fixed price of $ 0.7582 per share of common stock, a (ii) a warrant to purchase 1,000,000 shares of common stock at an exercise

price of $ 1.00 per share (the “$ 1.00 Warrant”), and (iii) a warrant to purchase 500,000 shares of common stock at an exercise

price of $ 1.50 per share (the “$ 1.50 Warrant” and, together with the $ 1.00 Warrant, the “Warrants” and together

with the Convertible Note, the “Purchased Securities”), in consideration of an initial loan in the principal amount of $ 2,000,000

(the “Initial Loan”) made to the Company under the Convertible Note, subject to the terms and conditions thereof.

19, 2024, the Company, Mr.

Kaufman and Kaufman Kapital LLC (“Kaufman Kapital”) entered into an amendment to the SPA, which

among other things, replaced Mr.

Kaufman with Kaufman Kapital as the “Investor” under the SPA.

July 24, 2024, the Company issued the Purchased Securities to Kaufman Kapital in consideration of making the Initial Loan to the Company.

On December 9, 2024, Kaufman Kapital made an additional loan to the Company under the Convertible Note in the amount of $ 1,400,000 .

Convertible Note matures on the earlier of (i) December 31, 2025 , (ii) the sale by the Company of $ 5,000,000 of equity or debt securities

in a single transaction or series of related transactions (excluding certain specified transactions), or (iii) the closing of a change

of control transaction as provided in the Convertible Note.

Loans outstanding under the Convertible Note bear interest at an initial

rate of 12 % per annum, and together with accrued principal are convertible into common stock.

Company’s obligations under the Convertible Note are secured by a lien granted to Kaufman Kapital on substantially all of the Company’s

assets pursuant to a Security Agreement entered between the Company and Kaufman Kapital (the “Security Agreement”).

the Convertible Note includes affirmative and negative covenants, events of defaults and other terms and conditions, customary in transactions

of this nature.

Promissory Note

August 30, 2024, the Company borrowed $ 1,200,000 from Kaufman Kapital pursuant to a Senior Secured Promissory Note in the principal amount of $ 1,200,000

(the “Note”) issued by the Company to Kaufman Kapital.

The Note matures on June

30, 2025 , as amended.

The loan under the Note bears interest at a rate of 15 %

The Company’s obligations under the Note are secured by a lien on substantially all of the Company’s assets pursuant

to the Security Agreement.

In addition, the Note includes affirmative and negative covenants, events of defaults and other terms and

conditions, customary in transactions of this nature.

Vision Promissory Notes

connection with the sale of the Purchased Securities to Kaufman Kapital LLC under the SPA, the Company entered into an Omnibus Amendment

to Note Documents with substantially all of the holders (the “Holders”) of the Company’s Senior Notes and Warrants

issued under that certain Subscription Agreement dated as of January 10, 2024, as amended, pursuant to which, among other things, (i)

the exercise price of the Warrants issued to the Holders was reduced from $ 2.00 to $ 1.00 , (ii) the outside maturity date of the Senior Notes held by the Holders was extended from December 31, 2024 to December 31, 2025 (subject to further extension in the event the maturity

date of the Convertible Note is extended), (iii) the Company’s obligation to make payments of principal under the Senior Notes

held by the Holders beginning July 1, 2024 has been eliminated, and instead all obligations of the Company under such Senior Notes will

be due in one lump sum on the maturity date of the Senior Notes, and (iv) the Company’s obligations under the Convertible Note

and liens granted to the holder thereof, will be pari passu with the Company’s obligations under the Senior Notes held by the Holders

and liens granted to the holders thereof.

The amendment warrants resulted in $ 89,949 of additional interest expense.

TO CONSOLIDATED FINANCIAL STATEMENTS

various dates from January 9, 2024 through May 22, 2024, the Company completed the sale of an aggregate $ 1,675,000 of Senior Secured

Promissory Notes (“Senior Notes”) and Warrants (“Warrants”) to purchase an aggregate of 518,750 shares of the

Company’s common stock, to a group of Investors (“Investors”) led by Eagle Vision Fund LP (“Eagle Vision”),

an affiliate of John Dalfonsi, CFO of the Company, pursuant to a subscription agreement between the Company and the Investors.

to the subscription agreements, Eagle Vision was paid aggregate cash fees in the amount of $ 177,500 upon the closing of the transactions

for due diligence fees in consideration of services rendered and to be rendered by Eagle Vision to the Company and the investors, including

conducting due diligence with respect to the Company, monitoring the performance by the Company of its obligations under the senior secured

notes, servicing the interest and principal payments for purchasers, engaging in ongoing discussions with the Company’s management

regarding the Company’s operations and financial condition, acting as collateral agent, and evaluating financial and non-financial

information related to the Company, which services are to be provided by Eagle Vision until the senior secured notes have been paid in

full, and an aggregate $ 35,000 of legal fees was paid to Investors’ counsel.

Notes mature on the earlier of December 31, 2025 , or the occurrence of a Qualified Subsequent Financing or Change of Control (as such

terms are defined in the Subscription Agreement) and bear interest at a rate of 15 % per annum.

In addition, the Notes are subject to

covenants, events of defaults and other terms and conditions set forth in the Subscription Agreement.

The Company’s obligations

under the Notes are secured by liens on substantially all of the Company’s assets pursuant to the terms of a Security Agreement

between the Company and the Investors.

Warrant is exercisable for a 10 ten-year period at an exercise price of $ 1.00 per share.

Offering Sale of Common Stock and Warrants

July 15, 2024, the Company entered into Subscription Agreements (the “Subscription Agreements”) with three related parties,

consisting of Eric Healy, the Company’s Chief Executive Officer;

Eagle Vision, an affiliate of John Dalfonsi, the Company’s

Chief Financial Officer;

and the Company’s President, pursuant to which such investors agreed to purchase $ 525,000 of “Units”

from the Company, each Unit consisting of (i) 100 shares of common stock, and (ii) a warrant to purchase 125 shares of common stock over

the following ten years at an exercise price of $ 1.00 per share, at a purchase price per Unit equal to $ 75.82 .

The Company completed

the sale of the Units to Eric Healy and the Company’s President on July 23, 2024, and the sale of the Units to Eagle Vision on

August 30, 2024, resulting in the issuance of an aggregate of 692,429 shares of common stock and warrants to purchase 865,536 shares

of common stock.

Stock Options Issued for Services

August 8, 2023, the Company granted options to purchase 30,000 shares of the Company’s common stock under its 2022 Equity Incentive

Plan (the “2022 Plan”), having an exercise price of $ 6.00 per share, exercisable over a 10 -year term, to the then chairman

of the audit committee and now, Chief Financial Officer.

February 22, 2024, the Company granted options to purchase 140,000 shares of the Company’s common stock under its 2022 Equity Incentive

Plan (the “2022 Plan”), having an exercise price of $ 1.92 per share, exercisable over a 10 -year term, to the Company’s

The options vested immediately.

February 22, 2024, the Company granted options to purchase 75,000 shares of the Company’s common stock, having an exercise price

of $ 1.92 per share, exercisable over a 10 -year term, to the Company’s CFO.

The options vested immediately.

February 22, 2024, the Company also granted options to purchase an aggregate 79,166 shares of the Company’s common stock, having

an exercise price of $ 1.92 per share, exercisable over a 10 -year term, to a total of three of the Company’s directors.

vested immediately.

August 8, 2023, the Company granted options to purchase 30,000 shares of the Company’s common stock under the 2022 Plan, having

an exercise price of $ 6.00 per share, exercisable over a 10 -year term, to the then chairman of the audit committee and now, Chief Financial

The options vest monthly over a 1 one-year period.

The estimated value using the

Black-Scholes Pricing Model, based on a volatility rate of 39 % and a call option value of $ 0.1644 , was $ 4,932 .

The options are being

expensed over the vesting period, resulting in $ 1,952 of stock-based compensation expense during the year ended December 31, 2023.

of December 31, 2023, a total of $ 2,980 of unamortized expenses are expected to be expensed over the vesting period.

August 8, 2023, the Company granted options to purchase 30,000 shares of the Company’s common stock under the 2022 Plan, having

1 unchanged sentence

The options vest monthly over a 1 one-year

The estimated value using the Black-Scholes Pricing Model, based on a volatility rate of 39 % and a call option value of $ 0.7885 ,

was $ 23,655 .

The options are being expensed over the vesting period, resulting in $ 9,364 of stock-based compensation expense during the

year ended December 31, 2023.

As of December 31, 2023, a total of $ 14,291 of unamortized expenses are expected to be expensed over the

vesting period.

January 1, 2022, the Company awarded options to purchase 57,600 shares of common stock under the 2022 Plan at an exercise price equal

to $ 4.125 per share, exercisable over a ten -year period to the Company’s then Chief Financial Officer.

The options vest monthly

over an eighteen (18) month period, with the initial vesting commencing on January 1, 2022.

The estimated value using the Black-Scholes

Pricing Model, based on a volatility rate of 29 % and a call option value of $ 1.1531 , was $ 66,419 .

The options were expensed over the

vesting period, resulting in $ 23,619 and $ 44,280 of stock-based compensation expense during the years ended December 31, 2023 and 2022,

respectively.

The options terminated 90 days from the employee’s terminated services, on November 14, 2023.

TO CONSOLIDATED FINANCIAL STATEMENTS

Stock Issued for Services

October 26, 2023, the Company issued 12,500 shares, restricted in accordance with Rule 144, to a consultant, who later became a Company

director, for services performed.

The aggregate fair value of the shares was $ 19,000 , based on the

closing traded price of the common stock on the date of grant .

5 – Formation of Subsidiary

April 26, 2024, the Company formed BranchOut Food Sucursal Peru, a wholly-owned subsidiary in Peru, in the form of a legal entity

called a branch, for the purpose of operating the 50,000

square-foot Peru Facility.

The Company began manufacturing products at the Peru Facility in December of 2024.

6 – Fair Value of Financial Instruments

16 unchanged sentences

3 - Unobservable inputs that reflect our assumptions about the assumptions that market participants would use in pricing the asset or

TO FINANCIAL STATEMENTS

following schedule summarizes the valuation of financial instruments at fair value on a recurring basis in the balances sheet as of December

1 unchanged sentence

Schedule of Valuation of Financial Instruments at Fair Value on a Recurring Basis

Fair Value Measurements at December 31, 2023

Value Measurements at December 31, 2024

Right-of-use-asset

Notes receivable

Notes payable

Lease liability

Total liabilities

Total assets and liabilities

Fair Value Measurements at December 31, 2022

Cash, restricted

Notes receivable

Convertible notes payable, related parties

Convertible notes payable

net of $ 66,587 of discounts

Notes payable

Revolving line of credit

Total liabilities

Notes payable, related parties

Lease liabilities

Total assets and liabilities

1 unchanged sentence

$ ( 3,521,286 )

TO CONSOLIDATED FINANCIAL STATEMENTS

Value Measurements at December 31, 2023

Right-of-use-asset

Notes receivable

Notes payable

Lease liability

Total assets and liabilities

were no transfers of financial assets or liabilities between Level 1 and Level 2 inputs for the years ended December 31, 2024 and 2023.

2 unchanged sentences

receivable balances individually represented 10 % or more of the Company’s total accounts receivable, as follows:

the years ended December 31, 2023 and 2022, two customers accounted for 90 % and 70 % of net revenue, respectively.

The customers were

not the same from year to year.

For the year ended December 31, 2023, Wal-Mart Stores and Costco accounted for 77 % and 13 % of net sales,

respectively.

For the year ended December 31, 2022, KEHE Distributors and Costco accounted for 11 % and 59 % of net sales, respectively.

December 31, 2023, Wal-Mart Stores accounted for 57 % and Costco accounted for 28 % of accounts receivable.

On December 31, 2022, KeHE

Distributors accounted for 58 %, Wal-Mart Stores accounted for 18 % and United Natural Foods accounted for 16 % of accounts receivable.

TO FINANCIAL STATEMENTS

the years ended December 31, 2024 and 2023, two customers accounted for 99 % and 90 % of net revenue, respectively, and 89 % and 85 % of

accounts receivable, respectively.

8 – Other Current Assets

4 unchanged sentences

Prepaid professional & license fees

Refunds receivable

Miscellaneous prepaid expenses

Interest receivable

Advances to co-manufacturer, NXTDried (1)

Total other current assets

Company has advanced NXTDried Superfoods SAC (“NXTDried”), a company organized under the laws of Peru, with its

principal office in San Isidro, Lima, Peru, a total of $ 495,930

over various dates between January 28, 2022 and September 27, 2023, for the purchase and construction of the facility and

infrastructure necessary to facilitate the manufacturing of the Company’s products.

The advance is to be repaid in the form of

a $1.00 USD per kilogram discount on all products manufactured for the Company.

The advance is not documented by a promissory note,

and is unsecured.

A total of $ 10,665

was credited against purchases made from NXTDried during the year ended December 31, 2023, resulting in a balance owed of $ 485,265 .

During the fourth quarter of 2023, one of NXTDried’s creditors filed suit against NXTDried and foreclosed on its collateral

pursuant to a secured promissory note.

As a result, the Company recognized impairment expense of $ 761,085

for the year ended, December 31, 2023, consisting of $ 485,265

on the remaining unpaid balance of the advances to NXTDried, $ 243,305

related to a VAT tax receivable, and $ 32,515

of prepaid inventory that was owed to the Company by NXTDried.

8 – Restricted Cash

May 7, 2021, the Company entered into a secured loan agreement (“Loan Agreement”) with EnWave Corporation (“EnWave”)

that was partially collateralized with a cash pledge in the amount of $ 125,000 , which was subsequently supplemented by a Guarantee Agreement,

dated November 22, 2021, in which the cash pledge was increased to $ 235,750 to cover EnWave’s responsibility for additional Value

Added Taxes (“VAT”).

On May 25, 2023, the pledged funds were released to the Company, net of a finance cost of $ 2,082 .

following table provides a reconciliation of cash and restricted cash reported within the balance sheets that sum to the total of the

same such amounts shown in the statements of cash flows:

of Reconciliation of Cash and Restricted Cash

Restricted cash

Total cash and restricted cash shown in the statement of cash flows

other current assets

9 – Property and Equipment

and equipment at December 31, 2024 and 2023, consisted of the following:

of Property and Equipment

Schedule of Property and Equipment

Equipment and machinery

Accumulated depreciation

Total property and equipment, net

of property and equipment was $ 223,856

and $ 93,253 for the years

ended December 31, 2023 and 2022, respectively.

Property and equipment was placed in service during the third quarter of 2022, and commenced production activities

on January 1, 2023, resulting in the recognition of depreciation as a component of cost of goods sold for the year ended December 31,

TO FINANCIAL STATEMENTS

property and equipment, net

of property and equipment was $ 171,873 and $ 223,856 for the years ended December 31, 2024 and 2023, respectively.

For the year ended,

December 31, 2024, a total of $ 34,034 of depreciation was included in the inventoried production costs, which gets expensed as Cost of

Goods Sold as the inventory is sold.

TO CONSOLIDATED FINANCIAL STATEMENTS

10 – Other Assets

assets consisted of the following as of December 31, 2024 and 2023:

Schedule of Other Assets

First position

receivable (2)

other current assets

May 10, 2024, in connection with the lease of the Company’s facility in Peru, the Company paid $ 275,000

toward the purchase of a First Position Mortgage (“FPM”) receivable in the amount of $ 1,267,000 ,

which is secured by the Peru facility and was owed by the landlord of the Peru facility to its former tenant, for a purchase price

of $ 1,267,000 .

The Company paid an additional $ 80,000

during the fourth quarter of 2024, and the remaining $ 912,000

FPM is to be paid in monthly installments of $ 152,000

from January 24, 2025 to June 23, 2025 , as presented in other current liabilities on the balance sheet.

The unpaid balance

accrues interest at 9 %.

At December 31, 2024, a total of $ 33,215

of interest was accrued.

The FPM enables the Company to ensure that they have uninterrupted access to the leased facility, and secures the

option to purchase the facility by becoming the primary lien holder on the facility.

The Company intends to exercise its option to purchase

the facility at some point in the future, in which case the FPM would either be repaid out of the proceeds from a mortgage, or the FPM

would be used to reduce the purchase price of the facility.

tax receivable is comprised of taxes that were paid as the Company imported equipment and raw materials into Peru.

These taxes will

be refunded as inventory is exported, or if equipment is exported for any unforeseeable reason.

11 – Notes Receivable

13 unchanged sentences

deferred collection of the minimum annual payment requirement for 2023 until 2024 when several large orders were placed.

A total of $ 33,100

of the Advance Payment had been repaid during the year ended December 31, 2022, consisting of $ 22,714 of principal and

$ 10,386 of interest.

As of December 31, 2023, a total of $ 131,594 of the Advance Payment had been

repaid as a reduction of inventory costs, consisting of $ 115,372 of principal and $ 16,222 of interest.

All payments consisted of reductions

in inventory costs, other than a payment of $ 15,000 in cash on March 24, 2021.

As of December 31, 2023, a total of $ 404,163 was outstanding

from Nanuva, consisting of $ 384,628 of principal and $ 19,535 of unpaid interest.

As of December 31, 2022, a total of $ 392,625 was outstanding

from Nanuva, consisting of $ 384,628 of principal and $ 7,997 of unpaid interest.

The Advance Payment is collateralized by a second lien

in the equipment.

Pursuant to the MDA, the Company has been appointed as Nanuva’s exclusive distributor in the following territories:

Exclusive Distributor in Territories

Minimum Volume

As of December

31, 2024, a total of $ 140,018 of the Advance Payment had been repaid as a reduction of inventory costs, consisting of $ 140,018 of principal

and $ 16,223 of interest.

All payments consisted of reductions in inventory costs, other than a payment of $ 15,000 in cash on March 24,

As of December 31, 2024, a total of $ 390,722 was outstanding from Nanuva, consisting of $ 359,982 of principal and $ 30,740 of unpaid

As of December 31, 2023, a total of $ 404,163 was outstanding from Nanuva, consisting of $ 384,628 of principal and $ 19,535 of

unpaid interest.

The Advance Payment is collateralized by a second lien in the equipment.

Pursuant to the MDA, the Company has been appointed

as Nanuva’s exclusive distributor in the following territories:

Summary of Nanuva’s Exclusive Distributor in Territories

(Kg/month)(“MOQ”)

13 unchanged sentences

Accrued chargebacks

Total accrued expenses

TO FINANCIAL STATEMENTS

12 – Convertible Notes Payable, Related Parties

notes payable, related parties consisted of the following at December 31, 2023 and 2022, respectively:

Schedule of Convertible Notes Payable, Related Parties

On January 5, 2023, the Company sold an unsecured convertible promissory note for $ 25,000 to the Chief Executive Officer’s parents, Mr.

Tom and Carol Healy, bearing interest at 8 % per annum, mature on the earlier of:

a) June 30, 2023, b) the closing of a Qualified Subsequent Financing, c) the closing of a change of control, or d) the Company’s S-1 registration statement being declared effective and the signing of a firm commitment underwriting agreement for a capital raise of at least ten million dollars ($ 10,000,000 ).

The note was convertible at a fixed conversion price of $ 4.125 per common share, and all interest was deemed to have stopped accruing as of a date selected by the Company that is up to 10 days prior to the effective date of the registration statement filed in connection with the IPO.

The note was mandatorily convertible upon the Company’s S-1 registration statement being declared effective and the signing of a firm commitment underwriting agreement for a capital raise of at least ten million dollars ($ 10,000,000 ).

The public offering proceeds threshold had subsequently been amended to $ 5,000,000 , along with all of the other outstanding convertible notes.

The note carried a default interest rate of 18 % per annum.

(See the description of the First Quarter of 2023 Convertible Notes in Note 11 – Convertible Notes Payable, below).

On June 15, 2023, the note, consisting of $ 25,000 of principal and $ 800 of interest, was converted into 6,255 shares of common stock.

The note was converted in accordance with the conversion terms;

therefore, no gain or loss had been recognized.

On December 31, 2021, the Company sold an unsecured convertible promissory note (“CFO Note”) to the Company’s then Chief Financial Officer, Douglas Durst, in the face amount of $ 90,000 .

The CFO Note, carried interest at 5 % per annum, originally carried an automatic conversion upon (i) a Qualified Financing, consisting of the closing of the sale of shares of its stock of at least $ 1,000,000 , at a conversion rate of the lesser of (i) the product of (x) eight-tenths (0.8) and (y) the price per share paid by the purchasers of the preferred stock sold in the Qualified Financing and (ii) the price per share obtained by dividing $ 7,000,000 (the “Valuation Cap”) by the Company’s fully-diluted capitalization immediately prior to the Qualified Financing (excluding any shares issued upon conversion of convertible debt), were amended on December 17, 2021 to be automatically converted upon the date on which a registration statement for the Company’s underwritten public offering of its common stock with total proceeds to the Company of not less than $ 10,000,000 (the “IPO”) was effective, at a fixed conversion price of $ 4.125 per common share, and all interest was deemed to have stopped accruing as of a date selected by the Company that is up to 10 days prior to the effective date of the registration statement filed in connection with the IPO.

The maturity date was extended to June 30, 2023 and the public offering proceeds threshold had been amended to $ 5,000,000 .

On June 15, 2023, the note, consisting of $ 90,000 of principal and $ 6,362 of interest, was converted into 23,361 shares of common stock.

The note was converted in accordance with the conversion terms;

therefore, no gain or loss had been recognized.

On May 28, 2020, the Company sold an unsecured convertible promissory note (“Coulter Note”) to the Company’s Chief Financial Officer, Chris Coulter, in the face amount of $ 50,000 .

The Coulter Note, carried interest at 5 % per annum, originally carried an automatic conversion upon (i) a Qualified Financing, consisting of the closing of the sale of shares of its stock of at least $ 1,000,000 , at a conversion rate of the lesser of (i) the product of (x) eight-tenths (0.8) and (y) the price per share paid by the purchasers of the preferred stock sold in the Qualified Financing and (ii) the price per share obtained by dividing $ 7,000,000 (the “Valuation Cap”) by the Company’s fully-diluted capitalization immediately prior to the Qualified Financing (excluding any shares issued upon conversion of convertible debt), were amended on December 17, 2021 to be automatically converted upon the date on which a registration statement for the Company’s underwritten public offering of its common stock with total proceeds to the Company of not less than $ 10,000,000 (the “IPO”) was effective, at a fixed conversion price of $ 4.125 per common share, and all interest was deemed to have stopped accruing as of a date selected by the Company that is up to 10 days prior to the effective date of the registration statement filed in connection with the IPO.

The maturity date was also extended to June 30, 2023 and the public offering proceeds threshold had been amended to $ 5,000,000 .

On June 15, 2023, the note, consisting of $ 50,000 of principal and $ 7,525 of interest, was converted into 13,946 shares of common stock.

The note was converted in accordance with the conversion terms;

therefore, no gain or loss had been recognized.

Accrued royalties

accrued expenses

TO CONSOLIDATED FINANCIAL STATEMENTS

13 – Convertible Notes Payable, Related Parties

accordance with ASC 470-20 Debt with Conversion and Other Options, the Company recorded total discounts of $ 19,054 on the CFO Note and

$ 19,961 on the Coulter Note upon the respective origination dates.

The discounts were amortized to interest expense over the term of

the debentures using the effective interest method.

The Company recorded $ 19,004 of interest expense pursuant to the amortization of

note discounts during the year ended December 31, 2022.

Company recorded interest expense pursuant to the stated interest rates on the Convertible Notes, Related Parties in the amount of $ 3,696

and $ 6,999 for the years ended December 31, 2023 and 2022, respectively.

TO FINANCIAL STATEMENTS

13 – Convertible Notes Payable, Unrelated Parties

notes payable, unrelated parties, consists of the following at December 31, 2023 and 2022, respectively:

of Convertible Notes Payable, Unrelated Parties

On various origination dates between January 5, 2023 and March 27, 2023, the Company sold a total of ten (10) individual unsecured convertible promissory notes (“First Quarter of 2023 Convertible Notes”) with substantially the same terms in exchange for gross proceeds of $ 442,500 .

The First Quarter of 2023 Convertible Notes, bearing interest at 8 % per annum, matured on the earlier of:

a) June 30, 2023 , b) the closing of a Qualified Subsequent Financing, c) the closing of a change of control, or d) the Company’s S-1 registration statement being declared effective and the signing of a firm commitment underwriting agreement for a capital raise of at least ten million dollars ($10,000,000).

Each First Quarter of 2023 Convertible Notes was convertible at a fixed conversion price of $ 4.125 per common share, and all interest was deemed to have stopped accruing as of a date selected by the Company that was up to 10 days prior to the effective date of the registration statement filed in connection with the IPO.

Each note is mandatorily convertible upon the Company’s S-1 registration statement being declared effective and the signing of a firm commitment underwriting agreement for a capital raise of at least ten million dollars ($10,000,000).

The public offering proceeds threshold had subsequently been amended to $ 5,000,000 , along with all of the other outstanding convertible notes.

The First Quarter of 2023 Convertible Notes carried a default interest rate of 18 % per annum.

On June 15, 2023, the notes, consisting of an aggregate $ 442,500 of principal and $ 9,801 of interest, were converted into 109,655 shares of common stock.

The notes were converted in accordance with the conversion terms;

therefore, no gain or loss had been recognized.

On various origination dates between October 28, 2022 and December 13, 2022, the Company sold a total of sixteen (16) individual unsecured convertible promissory notes (“2022 Convertible Notes”) with substantially the same terms in exchange for gross proceeds of $ 645,600 .

The Convertible Notes, bearing interest at 8 % per annum, matured on the earlier of:

a) June 30, 2023 , as extended from the original maturity date of June 30 2023, b) the closing of a Qualified Subsequent Financing, c) the closing of a change of control, or d) the Company’s S-1 registration statement being declared effective and the signing of a firm commitment underwriting agreement for a capital raise of at least ten million dollars ($10,000,000).

Each note was convertible at a fixed conversion price of $ 4.125 per common share, and all interest was deemed to have stopped accruing as of a date selected by the Company that was up to 10 days prior to the effective date of the registration statement filed in connection with the IPO.

Each note was mandatorily convertible upon the Company’s S-1 registration statement being declared effective and the signing of a firm commitment underwriting agreement for a capital raise of at least ten million dollars ($10,000,000).

The public offering proceeds threshold had subsequently been amended to $ 5,000,000 .

The notes carried a default interest rate of 18 % per annum.

On June 15, 2023, the notes, consisting of an aggregate $ 645,600 of principal and $ 27,925 of interest, were converted into 163,284 shares of common stock.

The notes were converted in accordance with the conversion terms;

therefore, no gain or loss had been recognized.

On June 6, 2022, the Company completed the sale of (i) an unsecured convertible promissory note in the principal amount of $ 200,000 (“Fluffco Convertible Note”) to Fluffco, LLC (“Fluffco”), and (ii) a five -year warrant to purchase 8,485 shares of the Company’s common stock at an exercise price of $ 6.50 per share, for an aggregate purchase price of $ 186,000 , pursuant to a Securities Purchase Agreement between the Company and Fluffco (the “Purchase Agreement”).

The Fluffco Convertible Note carried interest at 8 % per annum and a default rate of 18 %, which was mandatorily convertible upon the date on which a registration statement for the Company’s underwritten public offering of its common stock with total proceeds to the Company of not less than $ 10,000,000 was effective, at a fixed conversion price of $ 4.125 per common share.

The note matured on November 30, 2022 , and all interest was deemed to have stopped accruing as of a date selected by the Company that was up to 10 days prior to the effective date of the registration statement filed in connection with the IPO.

The aggregate estimated value using the Black-Scholes Pricing Model, based on a volatility rate of 35 % and a call option value of $ 0.2679 , was $ 8,485 , and was amortized as a debt discount over the life of the loan.

The Company received net proceeds of $ 186,000 after deductions of debt discounts, consisting of $ 14,000 of legal fees.

The maturity dates were extended to June 30, 2023 and the public offering proceeds threshold had been amended to $ 5,000,000 .

On June 15, 2023, the note, consisting of $ 200,000 of principal and $ 15,737 of interest, was converted into 52,300 shares of common stock.

The note was converted in accordance with the conversion terms;

therefore, no gain or loss had been recognized.

On May 26, 2022, the Company completed the sale of (i) an unsecured convertible promissory note in the principal amount of $ 1,250,000 (“Foss Convertible Note”) to Don Foss (“Foss”), and (ii) a five -year warrant to purchase 45,833 shares of the Company’s common stock at an exercise price of $ 6.50 per share, for an aggregate purchase price of $ 1,162,500 , pursuant to a Securities Purchase Agreement between the Company and Foss (the “Purchase Agreement”).

The Foss Convertible Note carried interest at 8 % per annum and a default rate of 18 %, which was mandatorily convertible upon the date on which a registration statement for the Company’s underwritten public offering of its common stock with total proceeds to the Company of not less than $ 10,000,000 was effective, at a fixed conversion price of $ 4.125 per common share.

The note matured on November 30, 2022 , and all interest was deemed to have stopped accruing as of a date selected by the Company that is up to 10 days prior to the effective date of the registration statement filed in connection with the IPO.

The aggregate estimated value using the Black-Scholes Pricing Model, based on a volatility rate of 34 % and a call option value of $ 0.2570 , was $ 45,833 , and was amortized as a debt discount over the life of the loan.

The Company received net proceeds of $ 1,162,500 after deductions of debt discounts, consisting of $ 87,500 of legal fees.

The maturity dates were extended to June 30, 2023 and the public offering proceeds threshold had been amended to $ 5,000,000 .

On June 15, 2023, the note, consisting of $ 1,250,000 of principal and $ 99,726 of interest, was converted into 327,207 shares of common stock.

The note was converted in accordance with the conversion terms;

therefore, no gain or loss had been recognized.

On various origination dates between February 15, 2022 and February 25, 2022, the Company sold two (2) individual unsecured convertible promissory notes (“First Convertible Eagle Vision Notes”) with a face value of $ 350,000 each, under substantially the same terms.

The First Convertible Eagle Vision Notes carried interest at 5 % per annum and a default rate of 18 %, which were mandatorily convertible upon the date on which a registration statement for the Company’s underwritten public offering of its common stock with total proceeds to the Company of not less than $ 10,000,000 was effective, at a fixed conversion price of $ 4.125 per common share.

The notes matured on November 30, 2022 , and all interest was deemed to have stopped accruing as of a date selected by the Company that was up to 10 days prior to the effective date of the registration statement filed in connection with the IPO.

The maturity dates were extended to June 30, 2023 and the public offering proceeds threshold had been amended to $ 5,000,000 .

On June 15, 2023, the notes, consisting of an aggregate $ 700,000 of principal and $ 44,590 of interest, were converted into 180,508 shares of common stock.

The notes were converted in accordance with the conversion terms;

therefore, no gain or loss had been recognized.

On various origination dates between March 1, 2018 and December 31, 2021, the Company sold a total of fifty-two (52) individual unsecured convertible promissory notes (“Convertible Notes”) with substantially the same terms, for total proceeds of $ 2,143,591 .

The Convertible Notes carried interest at 5 % per annum, which originally carried an automatic conversion upon (i) a Qualified Financing, consisting of the closing of the sale of shares of its stock of at least $ 1,000,000 , at a conversion rate of the lesser of (i) the product of (x) eight-tenths (0.8) and (y) the price per share paid by the purchasers of the preferred stock sold in the Qualified Financing and (ii) the price per share obtained by dividing $ 7,000,000 (the “Valuation Cap”) by the Company’s fully-diluted capitalization immediately prior to the Qualified Financing (excluding any shares issued upon conversion of convertible debt), were amended on December 17, 2021 to be automatically converted upon the date on which a registration statement for the Company’s underwritten public offering of its common stock with total proceeds to the Company of not less than $ 5,000,000 , as amended, was effective at fixed conversion prices of either $ 2.05 or $ 4.125 per common share (six (6) of the Convertible Notes, totaling $ 355,000 of principal, were amended to convert at $ 2.05 per common share, and forty-six (46) of the Convertible Notes, totaling $ 1,788,591 of principal, were amended to convert at $ 4.125 per common share), and all interest was deemed to have stopped accruing as of a date selected by the Company that was up to 10 days prior to the effective date of the registration statement filed in connection with the IPO.

On February 14, 2022, one of the Convertible Notes was repaid, consisting of $ 20,000 of principal and $ 3,586 of interest.

The Convertible Notes were originally set to mature after eighteen months but were later amended to extend the maturity to June 30, 2023 and the public offering proceeds threshold had been amended to $ 5,000,000 .

On June 15, 2023, the notes, consisting of an aggregate $ 2,123,591 of principal and $ 290,047 of interest, were converted into 695,655 shares of common stock.

The notes were converted in accordance with the conversion terms;

therefore, no gain or loss had been recognized.

Total convertible notes payable, unrelated parties

accordance with ASC 470, the Company recorded total discounts of $ 1,604,537 incurred as of December 31, 2022.

The discounts were amortized

to interest expense over the term of the debentures using the effective interest method.

The Company recorded $ 1,028,509 of interest

expense pursuant to the amortization of note discounts for the year ended December 31, 2022.

Company recorded interest expense pursuant to the Convertible Notes, Unrelated Parties in the amount of $ 138,316 and $ 327,353 , consisting

of stated interest rates on the Convertible Notes, Unrelated Parties, in the amount of $ 138,316 and $ 211,803 , and $- 0 - and $ 115,550 of

amortized debt discounts, for the years ended December 31, 2023 and 2022, respectively, including $ 14,050 of amortized debt discounts

on warrants for the year ended December 31, 2022.

TO FINANCIAL STATEMENTS

discussed in further detail in Note 4, on July 24, 2024, the Company issued the $ 3.4 million Convertible Note to Kaufman Kapital, together

with Warrants, convertible into shares of common stock at a fixed price of $ 0.7582 per share.

The Convertible Note matures on the earlier

of (i) December 31, 2025 , (ii) the sale by the Company of $ 5,000,000 of equity or debt securities in a single transaction or series of

related transactions (excluding certain specified transactions), or (iii) the closing of a change of control transaction as provided

in the Convertible Note.

Loans outstanding under the Convertible Note bear interest at an initial rate of 12 % per annum, and together

with accrued principal are convertible into common stock.

Company’s obligations under the Convertible Note are secured by a lien granted to Kaufman Kapital on substantially all of the Company’s

assets pursuant to the Security Agreement.

In addition, the Convertible Note includes affirmative and negative covenants, events of defaults

and other terms and conditions, customary in transactions of this nature.

accordance with ASC 470, the Company recorded total discounts of $ 95,958 , consisting of $ 75,000 of legal fees and $ 20,958 related to

the relative fair value of the Warrants.

The discounts are amortized to interest expense over the term of the loan using the effective

interest method.

As of December 31, 2024, a total of $ 66,587 of unamortized debt discounts are expected to be expensed over the remaining

life of the loan.

Company recognized $ 145,360 of interest expense on convertible notes payable, related parties for the year ended December 31, 2024, consisting

of $ 115,989 of stated interest expense, $ 22,956 of amortized debt discounts and $ 6,415 of amortized debt discounts due to warrants.

Company recognized $ 3,696 of interest expense on convertible notes payable, related parties for the year ended December 31, 2023.

14 – Notes Payable

June 12, 2023, the Company accepted subscriptions for $ 170,000 and issued senior secured promissory notes and stock purchase warrants

to four accredited investors.

Each promissory note (titled a “Subordinated Note”) accrued interest at an annual rate of 15 %,

of which 10 % was to be paid monthly, and the remaining 5 % to remain unpaid, compound annually, and was due and payable on the maturity

Upon default, the aggregate interest rate would increase to 18 % per annum.

Each Subordinated Note was due and payable on the earlier

(i) December 31, 2023, (b) the closing of a “Qualified Subsequent Financing”, and (c) the closing of an initial public

offering, as amended.

In the event a note was pre-paid, we were required to pay a minimum one-year of interest.

The term “Qualified

Subsequent Financing” means the next sale, or series of related sales, of any security in which we received $ 2,000,000 or more

from any parties that do not currently own, directly or indirectly, any of our common stock.

The Company received net proceeds of $ 150,000

in connection with the offering.

The Subordinated Notes were a general secured obligation of the Company, subordinated to the Senior

Secured Notes mentioned below.

During the year ended December 31, 2023, the Subordinated Notes were repaid in full, along with $ 25,500

of guaranteed interest.

addition to the Subordinated Notes, each investor received a warrant to purchase shares of our common stock at $ 6.00 per share, with

an issuance date of July 1, 2023, and expiring ten years from the issuance date.

The aggregate number of shares available for purchase

under the warrants are 30,000 shares, which were amortized as a debt discount over the life of the notes.

The Company is required to

Prior to the exercise of a warrant, the Company

is required to provide the investor monthly unaudited financial statements of income, cash flows, and stockholders’ equity.

Company recorded total debt discounts of $ 46,090 on warrants granted to the four investors for warrants issued in consideration of the

debt financing received on June 12, 2023.

The debt discounts were amortized as a debt discount over the original life of the notes, resulting

in $ 46,090 of finance costs for the year ended December 31, 2023.

March 15, 2023, the Company completed the sale of a Note to The John & Kristen Hinman Trust Dated February 23, 2016 (the “Hinman

Note”), pursuant to the Loan Agreement between the Company and the Hinman Trust.

The Hinman Note bears interest at 18 % per annum,

based on a 360-day year, and carries a monthly default rate of 1.5 % of all outstanding principal, interest, fees and penalties.

Note matured on January 10, 2024, as amended, and was secured by the Company’s accounts receivable from Walmart before being repaid

in the first quarter of 2024.

May 7, 2021, the Company accepted subscriptions for $ 1,000,000 and issued senior secured promissory notes and stock purchase warrants

to six accredited investors (the “May 2021 Bridge Financing”).

Each promissory note (titled a “Subordinated Note”)

accrued interest at an annual rate of 15 %, of which 10 % was to be paid monthly, and the remaining 5 % to remain unpaid, compound annually,

and was due and payable on the maturity date.

Upon default, the aggregate interest rate would increase to 18 % per annum.

Each Subordinated

Note was due and payable on the earlier of:

(i) November 30, 2022, (b) the closing of a “Qualified Subsequent Financing”,

and (c) the closing of an initial public offering, as amended.

In the event a note was pre-paid, we are required to pay a minimum one-year

The term “Qualified Subsequent Financing” means the next sale, or series of related sales, of any security in

which we received $ 2,000,000 or more from any parties that do not currently own, directly or indirectly, any of our common stock.

maturity dates were extended to June 30, 2023.

The Company received gross proceeds of $ 1,000,000 in connection with the offering, and

net proceeds of $ 890,000 , after payment of $ 110,000 in diligence fees to Eagle Vision Ventures, Inc.

(“Eagle Vision”), which

was amortized as a debt discount over the original life of the notes.

The Subordinated Notes were a general secured obligation of the

Company, subordinated to the Senior Secured Notes mentioned below.

During the year ended December 31, 2023, the Subordinated Notes were

repaid in full, along with $ 162,413 of interest.

addition to the Subordinated Notes issued in the May 2021 Bridge Financing, each investor received a warrant to purchase shares of our

common stock at $ 7.10 per share, expiring ten years from the issuance date, as subsequently amended on March 7, 2022.

The total number

of shares available for purchase under the warrants are 154,243 shares, including 15,382 warrants issued as offering costs in connection

with the Subordinated Notes, which were also amortized as a debt discount over the life of the notes.

The Company is required to register

the resale of the shares issuable upon exercise of the warrants with the SEC.

Prior to the exercise of a warrant, the Company is required

to provide the investor monthly unaudited financial statements of income, cash flows, and stockholders’ equity.

The Company recorded

total discounts of $ 176,228 on the Subordinated Notes, consisting of $ 110,000 of loan origination costs paid to Eagle Vision Ventures,

Inc, and an aggregate $ 66,228 of debt discounts on warrants granted to the eight investors for warrants issued in consideration of the

debt financing received on May 7, 2021, including warrants issued as offering costs to two additional parties.

The debt discounts were

amortized as a debt discount over the original life of the notes and were fully amortized as of December 31, 2022, resulting in $ 70,580

of finance costs, including $ 26,525 of amortized discounts attributable to the warrants for the year ended December 31, 2022.

the year ended December 31, 2023, the Subordinated Notes in the May 2021 Bridge Financing were repaid in full, along with $ 162,413 of

The principal balance of the notes payable was $ 1,000,000 at December 31, 2022.

The Company recognized $ 168,151 and $ 149,592

of stated interest expense on the May 2021 Bridge Financing for the years ended December 31, 2023 and 2022, respectively.

TO FINANCIAL STATEMENTS

December 8, 2020, the Company accepted subscriptions for $ 1,250,000 and issued senior secured promissory notes and stock purchase warrants

to three accredited investors.

Each promissory note (titled a “Senior Secured Note”) accrued interest at an annual rate of

15 %, of which 10 % was to be paid monthly, and the remaining 5 % to remain unpaid, compound annually, was due and payable on the maturity

Upon default, the aggregate interest rate would increase to 18 % per annum.

Each Senior Secured Note was due and payable on the

(i) November 30, 2022, (b) the closing of a “Qualified Subsequent Financing”, and (c) the closing of an initial

public offering, as amended.

In the event a note was pre-paid, we were required to pay a minimum one-year of interest.

The term “Qualified

Subsequent Financing” means the next sale, or series of related sales, of any security in which the Company received $ 2,000,000

or more from any parties that do not currently own, directly or indirectly, any of the Company’s common stock.

The maturity dates

were extended to June 30, 2023.

The Company received net proceeds of $ 1,115,000 , after payment of $ 135,000 in diligence fees to Eagle

Vision, in connection with the offering.

During the year ended December 31, 2023, the Senior Secured Notes were repaid in full, along

with $ 235,442 of interest.

Senior Secured Notes were a general secured obligation of the Company, senior in all respects to the liens, terms, covenants, and conditions

of all existing debt of the Company, except for our loans from Small Business Administration.

addition to the Senior Secured Notes, each investor received a warrant to purchase shares of our common stock at $ 2.60 per share, expiring

ten years from the issuance date, as subsequently amended on March 7, 2022.

The total number of shares available for purchase under the

warrants are 179,396 shares, including 47,811 warrants issued as offering costs in connection with the Subordinated Notes, which were

also amortized as a debt discount over the original life of the notes.

The Company was required to register the shares issuable upon

exercise of the warrants with the SEC.

Prior to the exercise of a warrant, the Company is required to provide the investor monthly unaudited

financial statements of income, cash flows, and stockholders’ equity for each such monthly period.

The principal balance of the

Senior Secured Notes was paid in full during the year ended December 31, 2023, and $ 1,250,000 was outstanding at December 31, 2022.

Company recorded total discounts of $ 180,196 on the Senior Secured Notes, consisting of $ 135,000 of loan origination costs paid to Eagle

Vision Ventures, Inc, and an aggregate $ 45,196 of debt discounts on warrants granted to the five investors for warrants issued in consideration

of the debt financing received on December 8, 2020, including warrants issued as offering costs to two additional parties.

The debt discounts

were amortized as a debt discount over the original life of the notes, resulting in $ 52,377 of finance costs, including $ 13,136 of amortized

discounts attributable to the warrants for the year ended December 31, 2022.

As of December 31, 2022, the debt discounts had been fully

May 17, 2020, the Company entered into a loan agreement with the United States Small Business Administration (the “SBA”),

as lender, pursuant to the SBA’s Economic Injury Disaster Loan (“EIDL”) assistance program in light of the impact of

the COVID-19 pandemic on the Company’s business (the “EIDL Loan Agreement”) encompassing a $ 34,500 Promissory Note

issued to the SBA (the “EIDL Note”) (together with the EIDL Loan Agreement, the “EIDL Loan”), bearing interest

at 3.75 % per annum.

In connection with entering into the EIDL Loan, the Company also executed a security agreement, dated May 17, 2020,

between the SBA and the Company pursuant to which the EIDL Loan is secured by a security interest on all of the Company’s assets.

Under the EIDL Note, the Company is required to pay principal and interest payments of $ 169 every month beginning May 17, 2021;

payable consists of the following as of December 31, 2024 and 2023:

Schedule of Notes Payable

On May 22, 2023, the Company

entered into an equipment purchase agreement with the EnWave Corporation (“EnWave”), for the purchase of a used 100kW

Rev vacuum microwave dehydration machine (the “EnWave Machine”).

Cash payments of $500,000 were paid towards the $1,000,000

purchase price on the EnWave Machine, while the $500,000 balance due is to be paid in twelve (12) monthly installments of $44,424,

bearing interest 12% per annum, commencing August 1, 2024.

On May 22, 2023, the Company

entered into an equipment purchase agreement with the EnWave Corporation (“EnWave”), for the purchase of a used 100kW

Rev vacuum microwave dehydration machine (the “EnWave Machine”).

Cash payments of $ 500,000 were paid towards the $ 1,000,000

purchase price on the EnWave Machine, while the $ 500,000 balance due is to be paid in twelve (12) monthly installments of $ 44,424 ,

bearing interest 12 % per annum, commencing August 1, 2024.

On March 15, 2023, the Company completed

the sale of a $ 200,000 Promissory Note to The John & Kristen Hinman Trust Dated February 23, 2016 (the “Hinman Note”),

pursuant to the Loan Agreement between the Company and the Hinman Trust.

The Hinman Note carried interest at 18 % per annum.

Note was repaid on January 2, 2024.

On May 17, 2020, the

Company entered into a loan agreement with the United States Small Business Administration (the “SBA”), as lender, pursuant

to the SBA’s Economic Injury Disaster Loan (“EIDL”) assistance program in light of the impact of the COVID-19 pandemic

on the Company’s business (the “EIDL Loan Agreement”) encompassing a $ 34,500 Promissory Note issued to the SBA

(the “EIDL Note”) (together with the EIDL Loan Agreement, the “EIDL Loan”), bearing interest at 3.75 % per

In connection with entering into the EIDL Loan, the Company also executed a security agreement, dated May 17, 2020, between

the SBA and the Company pursuant to which the EIDL Loan is secured by a security interest on all of the Company’s assets.

the EIDL Note, the Company is required to pay principal and interest payments of $ 169 every month beginning May 17, 2021;

the SBA extended the repayment date to November 17, 2022.

1 unchanged sentence

The EIDL Note may be repaid at any time without penalty.

The principal balance of the EIDL Loan was $ 34,500 as of December 31,

2023 and 2022.

TO FINANCIAL STATEMENTS

payable consists of the following as of December 31, 2023 and 2022:

of Notes Payable

Total notes payable

unamortized debt discounts

Notes payable

current maturities

Notes payable, less current maturities

Notes payable, less

current maturities

Company recognized $ 19,809 and $ 214,430 of interest expense on notes payable for the years ended December 31, 2024 and 2023, respectively.

Interest expense consisted of $ 214,430 of stated interest expense and $ 46,090 of amortized debt discounts due to warrants issued on a

Subordinated Note during the year ended December 31, 2023.

Interest expense consisted of $ 346,378 of stated interest expense and $ 500,158

of amortized debt discounts, including $ 39,661 of amortization of the debt discount on the Subordinated Notes due to warrants and $ 377,200

of expense related to the amendment of those warrants, during the year ended December 31, 2022.

15 – Revolving Line of Credit;

Interest Expense;

October 1, 2021, the Company entered into a Growth Line of Credit Agreement (“LOC”) with Ampla LLC, formerly known as Gourmet

Growth (“Gourmet Growth”), which allows us to draw funds from time to time, up to an aggregate principal amount of $ 400,000 ,

for the purpose of purchasing inventory.

The LOC accrues interest at 15 % per annum and requires a 2 % origination fee on each draw.

LOC was secured by all receivables, and all other tangible and intangible personal property, including, but not limited to cash, inventory,

equipment, investments, contract rights and other general intangibles and chattel paper.

The LOC requires that we collect payments on

our accounts receivable in an account in which Gourmet Growth is able to collect a percentage of the collections to repay the LOC.

line of credit is revolving and automatically renewed upon use for a 12-month period.

Repayment is made from current receivables, and

the outstanding balance of $ 42,750 was paid in full on July 13, 2023.

The Company’s balance of the LOC was $ 91,541 as of December

Company recorded interest expense pursuant to the stated interest rates on the LOC in the amount of $ 8,251 and $ 19,886 for the years

ended December 31, 2023 and 2022, respectively.

Company recognized interest expense as follows for the years ended December 31, 2023, and 2022, respectively:

TO CONSOLIDATED FINANCIAL STATEMENTS

15 – Notes Payable, Related Parties

discussed in Note 4, on August 30, 2024, the Company borrowed $ 1,200,000 from Kaufman Kapital pursuant to a Senior Secured Promissory

Note that, as amended, matures on June 30, 2025 .

The loan under the Note bears interest at a rate of 15 % per annum.

The Company’s

obligations under the Note are secured by a lien on substantially all of the Company’s assets pursuant to the Security Agreement.

In addition, the Note includes affirmative and negative covenants, events of defaults and other terms and conditions, customary in transactions

of this nature.

discussed in Note 4, in connection with the sale of the Purchased Securities to Kaufman Kapital under the SPA, the Company entered into

an Omnibus Amendment to Note Documents with substantially all of the Holders of the Company’s Senior Notes and Warrants issued

under that certain Subscription Agreement dated as of January 10, 2024, as amended, pursuant to which, among other things, (i) the exercise

price of the Warrants issued to the Holders was reduced from $ 2.00 to $ 1.00 , (ii) the outside maturity date of the Senior Notes held by the Holders was extended from December 31, 2024 to December 31, 2025 (subject to further extension in the event the maturity date

of the Convertible Note is extended), (iii) the Company’s obligation to make payments of principal under the Senior Notes held

by the Holders beginning July 1, 2024 has been eliminated, and instead all obligations of the Company under such Senior Notes will be

due in one lump sum on the maturity date of the Senior Notes, and (iv) the Company’s obligations under the Convertible Note and

liens granted to the holder thereof, will be pari passu with the Company’s obligations under the Senior Notes held by the Holders

and liens granted to the holders thereof.

The amendment warrants resulted in $ 89,949 of additional interest expense.

the period of May 14, 2024 through May 22, 2024, the Company completed the sale of an aggregate of $ 1,050,000 of Senior Notes, and Warrants

to purchase an aggregate of 262,500 shares of the Company’s common stock, to a group of Investors led by Eagle Vision, an affiliate

of John Dalfonsi, a director of the Company and its Chief Financial Officer.

The sales were effected pursuant to a Subscription Agreement,

dated January 10, 2024, between the Company and the investors in the Senior Notes, as amended by an amendment (“First Amendment”)

to the Subscription Agreement dated as of April 16, 2024 (as so amended, the “Subscription Agreement”).

Senior Notes mature on the earlier of December 31, 2025, or the occurrence of a Qualified Subsequent Financing or Change of Control (as

such terms are defined in the Subscription Agreement) and bear interest at a rate of 15 % per annum.

In addition, the Senior Notes are

subject to covenants, events of defaults and other terms and conditions set forth in the Subscription Agreement.

The Company’s

obligations under the Notes are secured by liens on substantially all of the Company’s assets pursuant to the terms of the Security

Agreement entered into by the Company on January 10, 2024 in favor of holders of the Senior Notes (the “Security Agreement”).

Each Warrant is exercisable for a 10 ten-year period at an exercise price of $ 1.00 per share.

April 16, 2024, the Company completed the sale of $ 225,000 of Senior Notes, and Warrants to purchase an aggregate of 56,250 shares of

the Company’s common stock, to a group of seven Investors, pursuant to a First Amendment to the Subscription Agreement between

the Company and the Investors dated as of April 16, 2024.

The First Amendment incorporates and amends certain provisions of the Subscription

Agreement, dated January 10, 2024, previously entered into by the Company and investors that purchased Notes and Warrants from the Company

on January 10, 2024 (the “January Investors”).

On July 30, 2024, the Company repaid an aggregate total of $ 115,000 of principal

to three of the seven Investors in settlement of their promissory notes.

First Amendment also (i) increased the aggregate principal amount of the Senior Notes available to be sold from time to time under the

Subscription Agreement from $ 400,000 to $ 2,000,000 , (ii) increased the number of shares of common stock of the Company available to be

issued under Warrants sold from time to time under the Subscription Agreement from 100,000 to 600,000 , (iii) provides for an aggregate

one-time payment in the amount of $ 46,290 to the January Investors and the issuance to them of Warrants to purchase 100,000 shares of

common stock, in consideration of their agreement to enter into the First Amendment, and (iv) provided for the payment of up to $ 80,000

to Eagle Vision Fund with the proceeds of Notes to be issued by the Company at subsequent closings of sales of Senior Notes and Warrants,

in consideration of services rendered and to be rendered by Eagle Vision to holders of the Senior Notes while the Notes are outstanding,

including acting as collateral agent and due diligence and collateral monitoring services.

TO CONSOLIDATED FINANCIAL STATEMENTS

January 9, 2024, the Company completed the sale of $ 400,000 of Senior Notes and Warrants to purchase an aggregate of 100,000 shares of

the Company’s common stock, to a group of six Investors led by Eagle Vision, pursuant to a Subscription Agreement between the Company

and the Investors.

accordance with ASC 470, the Company recorded total discounts of $ 339,698 , including $ 80,908 on the relative fair value of the Warrants,

incurred as of December 31, 2024.

The discounts are being amortized to interest expense over the term of the debentures using the effective

interest method.

The Company recorded an aggregate $ 339,698 of interest expense pursuant to the amortization of note discounts for the

year ended December 31, 2024.

Vision has been paid aggregate cash fees in the amount of $ 177,500 from the sales of the Senior Notes in consideration of services rendered

and to be rendered by Eagle Vision to the Company and the holders of the Senior Notes, including for conducting due diligence with respect

to the Company, monitoring the performance by the Company of its obligations under the Senior Notes, servicing the interest and principal

payments for holders of the Senior Notes, engaging in ongoing discussions with the Company’s management regarding the Company’s

operations and financial condition, acting as collateral agent, and evaluating financial and non-financial information related to the

The Company has also paid an aggregate of $ 35,000 of the investors’ legal fees from sales of the Senior Notes.

date, in a series of closings pursuant to the Subscription Agreement, including the most recent sales described above, the Company has

issued an aggregate $ 1,675,000 of principal pursuant to the Senior Notes, and Warrants to purchase an aggregate 518,750 shares of common

payable, related parties, consists of the following as of December 31, 2024 and 2023:

Schedule of Notes Payable Related Parties

Total Kaufman Note

Total Senior Notes

held by Eagle Vision

Total Senior Notes payable

Total notes payable,

related parties

current maturities

Notes payable, related

parties, less current maturities

Company recognized $ 664,847 and $ 66,090 of interest expense on notes payable, related parties for the years ended December 31, 2024 and

2023, respectively.

Interest expense for the year ended December 31, 2024, consisted of $ 235,200 of stated interest expense, $ 258,790

of amortized debt discounts and $ 80,908 of amortized debt discounts due to warrants, along with $ 89,949 of additional interest expense

related to the modification of warrants, issued to Eagle Vision Investors.

Interest expense for the year ended December 31, 2023, consisted

of $ 66,090 of amortized debt discounts, including $ 46,090 of amortized debt discounts due to warrants issued on a Subordinated Note during

the year ended December 31, 2023.

Company recognized aggregate interest expense for the years ended December 31, 2024 and 2023 respectively, as follows:

Schedule of Recognized Interest Expense

Interest on convertible notes payable, related parties

Interest on convertible notes

payable, related parties

Amortization of debt discounts on related

party convertible notes

Amortization of debt discounts on related

party convertible notes, warrants

Amortization of debt discounts on related

party convertible notes

Interest on convertible notes payable

Interest on notes payable

Amortization of debt discounts, convertible notes payable

Amortization of debt discounts, warrants, convertible notes payable

Amortization of debt discounts, notes payable

Amended warrants

Amortization of debt discounts, warrants, notes payable

Amortization of debt discounts on convertible notes payable, related parties, derivatives

Amortization of debt discounts on convertible notes payable, derivatives

Amortization of debt discounts

Interest on notes payable, related parties

Interest on notes payable

Amortization of debt discounts on related

Amortization of debt discounts on modification

of Eagle Vision warrants

Amortization of debt discounts on related

party notes, warrants

Amortization of debt discounts on related

Interest on other current liability, first

position mortgage

Interest on revolving line of credit

Finance charge on letter of credit

Interest on credit cards

Total interest expense

TO FINANCIAL STATEMENTS

aggregate amounts of maturities of notes payable during each of the five years following the balance sheet date and thereafter, including

amounts due within one year and classified as current, are as follows:

Schedule of Maturities of Notes Payable

Fiscal Year Ending

Note Payable Maturities

2028 and thereafter

Total notes payable gross

Less effects of discounting

Total notes payable

Interest on credit

interest expense

TO CONSOLIDATED FINANCIAL STATEMENTS

Company has financed production equipment with an acquisition cost of approximately $ 168,141 under a finance lease with a five-year term

and a bargain purchase price of $ 1.00 at the end of the lease term.

The finance lease commenced on May 9, 2023 and expires on August

31, 2027 , with monthly lease payments of $ 3,657 commencing June 1, 2023, subject to the ASU 2016-02.

As the Company’s lease does

not provide implicit discount rates, the Company uses an incremental borrowing rate based on the information available at the commencement

date in determining the present value of lease payments.

The finance lease commenced on May 9, 2023 and expires on May 31,

2028 , with monthly lease payments of $ 3,657 commencing June 1, 2023, and a pre-funding and acceptance fee of $ 18,079 , subject to the

As the Company’s lease does not provide implicit discount rates, the Company uses an incremental borrowing rate based

on the information available at the commencement date in determining the present value of lease payments.

Facility Lease

May 10, 2024, the Company entered into a ten-year lease for the 50,000 square-foot Peru Facility, which commenced operations in December

The lease of the Peru Facility requires monthly lease payments of $ 8,000 in the first two years of the lease, $ 20,000 in the

third year of the lease, $ 22,000 in the fourth year of the lease, $ 24,000 in the fourth year of the lease, and $ 25,000 thereafter.

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

connection with the lease of the Peru Facility, the Company purchased a first position mortgage receivable in the amount of $ 1,267,000 ,

which is secured by the Peru Facility and was owed by the landlord of the Peru Facility to its former tenant, for a purchase price of

$ 1,267,000 , of which $ 355,000 was paid during the year ended December 31, 2024.

The remaining $ 912,000 is to be paid in monthly installments

of $ 152,000 from January 24, 2025 to June 23, 2025, as presented in other current liabilities on the balance sheet.

The unpaid balance

accrues interest at 9 %.

At December 31, 2024, a total of $ 33,215 of interest was accrued.

components of lease expense were as follows:

1 unchanged sentence

For the Years Ended

Operating lease cost:

of right-of-use asset

Interest on lease liability

Capitalized inventory

Total operating lease

Finance lease cost:

Amortization of right-of-use asset

Amortization of right-of-use

Interest on lease liability

Total finance lease cost

Total finance lease

Other short-term leases

Total lease costs

balance sheet information related to leases was as follows:

Schedule of Supplemental Information Related to Leases

Operating lease:

Current portion of operating

lease liability

Noncurrent operating

lease liability

Total operating lease

Finance lease:

Finance lease assets

Current portion of finance lease liability

Noncurrent finance lease liability

Total finance lease liability

Current portion of finance

lease liability

Noncurrent finance lease

finance lease liability

Weighted average remaining lease term:

Operating lease

Finance lease

Weighted average discount rate:

Operating lease

Finance lease

TO FINANCIAL STATEMENTS

TO CONSOLIDATED FINANCIAL STATEMENTS

cash flow and other information related to finance leases was as follows:

1 unchanged sentence

For the Years Ended

Cash paid for amounts included in the measurement of lease liabilities:

Finance cash flows used for finance leases

Leased assets obtained in exchange for lease liabilities:

Total finance lease liabilities

Cash paid for amounts included in the measurement

of lease liabilities:

cash flows provided by operating leases

cash flows used for finance leases

Leased assets obtained in exchange for lease

operating lease liabilities

finance lease liabilities

future minimum lease payments due under operating leases as of December 31, 2024 is as follows:

Schedule of Future Minimum Operating Lease Payments

Minimum Lease

Total minimum lease payments

Less effects of discounting

Lease liability recognized

Less current portion

Long-term operating

lease liability

future minimum lease payments due under finance leases as of December 31, 2024 is as follows:

Schedule of Future Minimum Lease Payments

of Future Minimum Finance Lease Payments

Minimum Lease

2027 and thereafter

Total minimum lease payments

Less effects of discounting

Lease liability recognized

Less current portion

Long-term finance lease

TO CONSOLIDATED FINANCIAL STATEMENTS

17 – Commitments and Contingencies

5 unchanged sentences

a loss related to a certain matter is both probable and reasonably estimable.

Company leases equipment under a non-cancelable finance lease payable in monthly installments of $ 3,657 expiring on August 31, 2027.

There are currently no pending legal matters.

May 10, 2024, the Company entered into a ten-year lease for the 50,000 square-foot Peru Facility, which commenced operations in December

The lease requires monthly lease payments of $ 8,000 in the first two years of the lease, $ 20,000 in the third year of the lease,

$ 22,000 in the fourth year of the lease, $ 24,000 in the fourth year of the lease, and $ 25,000 thereafter.

The lease also has a 10 -year

renewal option, and a buy-out option under which the Company may purchase the Peru Facility for $ 1,865,456 .

Company leases equipment under a non-cancelable finance lease payable in monthly installments of $ 3,657 expiring on May 31, 2028 .

Contractual Commitments

3 unchanged sentences

facilities that will be reimbursed to the Company on an agreed per kg basis over the period of 2022 to 2026.

See Note 7 above regarding

amounts owed to us by NXTDried Superfoods SAC.

TO FINANCIAL STATEMENTS

May 7, 2021, the Company entered into a license agreement (“License Agreement”) with EnWave, pursuant to which EnWave licensed

2 unchanged sentences

The License Agreement

entitles EnWave to a fixed royalty percentage on all of the Company’s revenue from the sale of products produced using the EnWave

Technology, net of trade or volume discounts, refunds paid, settled claims for damaged goods, applicable excise, sales and withholding

taxes imposed at the time of the sale, and provides the Company with certain exclusivity rights with respect to the production of avocado

In order to maintain the exclusivity, the Company agreed to annual royalty minimum payments as follows:

Schedule of Maturity of Annual Royalty

Retention Royalty

* The unrecognized

commitment thereafter is $ 250,000 in perpetuity, as long as the Company elects to maintain exclusivity.

was amended on October 26, 2022, September 27, 2023 and May 23, 2024, to, among other things, modify the exclusivity retention royalty

payments required to be paid by the Company.

The License Agreement entitles EnWave to a fixed royalty percentage on all of the Company’s

revenue from the sale of products produced using the EnWave Technology, net of trade or volume discounts, refunds paid, settled claims

for damaged goods, applicable excise, sales and withholding taxes imposed at the time of the sale, and provides the Company with certain

exclusivity rights with respect to the production of avocado products.

In order to maintain the exclusivity, the Company must make annual

royalty minimum payments to EnWave of $ 250,000 per year, commencing in 2025 and continuing through each subsequent year in perpetuity,

as long as the Company elects to maintain exclusivity.

addition to the initial EnWave Equipment we purchased, the Company agreed to purchase additional equipment from EnWave over time.

The additional equipment purchase schedule, as amended, requires the Company to purchase a “Second EnWave Machine” and

pay up-to four non-refundable deposits for the Second EnWave Machine in the amount of fifty thousand dollars ($ 50,000 )

each on September 30, 2023, December 31, 2023, March 31, 2024 and June 30, 2024 (the “Interim Deposits”).

paid the first two non-refundable deposits of $ 50,000 on

September 27, 2023 and December 31, 2023.

The Company is also required to execute an Equipment Purchase Agreement for a 120kW, or greater rated power,

EnWave Equipment (the “Third EnWave Machine”) on or before December 31, 2025, and satisfy the payment obligations

required with respect to the Third EnWave Machine by the License Agreement.

The Company is also required to enter into an Equipment

Purchase Agreement for a 120kW, or greater, rated power EnWave Equipment (the “Fourth EnWave Machine”) on, or before,

December 31, 2026, and to satisfy the payment obligations required with respect to the Fourth EnWave Machine by the License

The License Agreement is effective as long as EnWave possesses its EnWave technology.

There have been no royalty payments

to date, and any future minimum royalty payments or equipment purchases under this license agreement are an unrecognized commitment,

as they relate to retaining exclusivity of the avocado products going forward and the Company can elect not to pay.

18 – Stockholders’ Equity (Deficit)

additional equipment purchase schedule, as amended, requires the Company to purchase a “Second EnWave Machine” and pay up-to

four non-refundable deposits for the Second EnWave Machine in the amount of fifty thousand dollars ($ 50,000 ) each on September 30, 2023,

December 31, 2023, March 31, 2024 and June 30, 2024 (the “Interim Deposits”).

The Company paid the first three non-refundable

deposits of $ 50,000 on September 27, 2023, December 31, 2023 and March 8, 2024, and completed the purchase on December 12, 2024.

Company is also required to execute an Equipment Purchase Agreement for a 120kW, or greater rated power, EnWave Equipment (the “Third

EnWave Machine”) on or before December 31, 2025, and satisfy the payment obligations required with respect to the Third EnWave

Machine by the License Agreement.

The Company is also required to enter into an Equipment Purchase Agreement for a 120kW, or greater,

rated power EnWave Equipment (the “Fourth EnWave Machine”) on, or before, December 31, 2026, and to satisfy the payment obligations

required with respect to the Fourth EnWave Machine by the License Agreement.

The License Agreement is effective as long as EnWave possesses

its EnWave technology.

There have been no royalty payments to date, and any future minimum royalty payments or equipment purchases under

this license agreement are an unrecognized commitment, as they relate to retaining exclusivity of the avocado products going forward

and the Company can elect not to pay.

TO CONSOLIDATED FINANCIAL STATEMENTS

18 – Stockholders’ Equity

Company has authorized 8,000,000 shares of $ 0.001 par value preferred stock.

5 unchanged sentences

Each holder of common stock is entitled to one vote for each share of common stock held .

October 23, 2024, the Company entered into an At-The-Market Issuance Sales Agreement (the “ATM Agreement”) for the sale of

shares of its common stock having an aggregate offering price of up to $ 3,000,000 .

The shares were sold at prevailing market prices,

and the offering was conducted through Alexander Capital, L.P.

(“Alexander Capital”).

Net proceeds from the offering of 1,317,307

shares of common stock under the ATM Agreement, after deducting applicable expenses, including a commission paid to Alexander Capital

equal to 3 % of the gross proceeds from the sale of the shares, amounted to approximately $ 2,305,005 for the year ended December 31, 2024.

As of December 31, 2024, the Company had 182,693 shares of common stock authorized but unissued, as held in a brokerage account with

Alexander Capital, which were available for issuance under the ATM Agreement.

These shares of common stock represent a part of the total

authorized share capital.

The issuance of shares has resulted in an increase in the outstanding common stock of the Company, as the proceeds

will be used for general corporate purposes or specific use of proceeds, if applicable.

No equity impact was recorded for these shares

during the year ended December 31, 2024.

Public Offering

7 unchanged sentences

of Common Stock at an exercise price of $ 7.20 , which may be exercised for a five-year period beginning December 18, 2023.

TO FINANCIAL STATEMENTS

to the IPO, all deferred offering costs were capitalized in other noncurrent assets on the balance sheets.

2 unchanged sentences

proceeds upon the closing of the Company’s IPO in June 2023.

As of December 31, 2023, all deferred offering costs were paid.

deferred offering costs totaled $ 543,664 as of December 31, 2022.

Stock Sales, Related Party for the Year Ended December 31, 2022

January 10, 2022, the Company sold 3,031 shares of common stock to the Company’s Controller at $ 1.65 per share for proceeds of

Stock Sales for the Year Ended December 31, 2022

January 7, 2022, the Company sold 1,213 shares of common stock to an accredited investor at $ 4.125 per share for proceeds of $ 5,000 .

Offering Sale of Common Stock and Warrants, Related Parties for the Year Ended December 31, 2024

July 15, 2024, the Company entered into Subscription Agreements (the “Subscription Agreements”) with three related parties,

consisting of Eric Healy, the Company’s Chief Executive Officer;

Eagle Vision;

and the Company’s President, pursuant to which

such investors agreed to purchase $ 525,000 of “Units” from the Company, each Unit consisting of (i) 100 shares of common

stock, and (ii) a warrant to purchase 125 shares of common stock over the following ten years at an exercise price of $ 1.00 per share,

at a purchase price per Unit equal to $ 75.82 .

The Company completed the sale of the Units to Eric Healy and the Company’s President

on July 23, 2024, and the sale of the Units to Eagle Vision on August 30, 2024, an affiliate of Mr.

Dalfonsi, the Company’s CFO,

resulting in the issuance of an aggregate of 692,429 shares of common stock and warrants to purchase 865,536 shares of common stock.

TO CONSOLIDATED FINANCIAL STATEMENTS

Offering of Common Stock

June 26, 2024, the Company entered into an Underwriting Agreement (the “Underwriting Agreement”) with Alexander Capital,

as the Representative of the underwriters named therein (the “Representative” and such other Underwriters, the “Underwriters”),

relating to the issuance and sale by the Company to the Underwriters (the “Public Offering”) of 1,750,000 Shares (the “Shares”)

of common stock at a price to the public of $ 0.80 per share, less underwriting discounts and commissions.

Pursuant to the Underwriting

Agreement, the Representative was granted an option (the “Over-Allotment Option”), for a period of 45 days, to purchase from

the Company up to 262,500 additional shares of common stock, at the same price per share, to cover over-allotments, if any.

to the Underwriting Agreement, the Company agreed to an 8.0 % underwriting discount on the gross proceeds received by the Company for

the Shares, in addition to reimbursement of certain expenses, made customary representations, warranties and covenants concerning the

Company, and also agreed to indemnify the Underwriters against certain liabilities, including liabilities under the Securities Act.

Offering closed on June 28, 2024.

The Company received net proceeds from the Offering of $ 1,000,925 after deducting the underwriting

discounts and commissions and offering expenses.

July 19, 2024, the Underwriters exercised their Over-Allotment Option to purchase 222,500 shares of common stock at a price of $ 0.80

The Company received net proceeds $ 163,760 , after deducting $ 14,240 of underwriting commissions.

Stock Issued for Services for the Year Ended December 31, 2024

June 1, 2024, the Company issued 6,383 shares of the Company’s common stock under the 2022 Omnibus Equity Incentive Plan (the “2022

Equity Plan”) to PCG Advisory, Inc.

(“PCG”) as payment for services in lieu of cash.

The fair value of the shares was

$ 9,819 , based on the closing traded price of the common stock on the date of grant .

May 1, 2024, the Company issued 4,766 shares of the Company’s common stock under the 2022 Equity Plan to PCG as payment for services

in lieu of cash.

The fair value of the shares was $ 11,438 , based on the closing traded price of

the common stock on the date of grant .

April 22, 2024, the Company issued 99,688 shares under the 2022 Equity Plan to its securities counsel for services performed.

value of the shares was $ 109,657 , based on the closing traded price of the common stock on the

date of grant .

April 1, 2024, the Company issued 4,988 shares of the Company’s common stock under the 2022 Equity Plan to PCG as payment for services

in lieu of cash.

The fair value of the shares was $ 9,577 , based on the closing traded price of

the common stock on the date of grant .

February 19, 2024, the Company issued 16,836 shares under the Company’s 2022 Equity Plan to its securities counsel for services

The fair value of the shares was $ 44,278 , based on the closing traded price of the common

stock on the date of grant .

January 26, 2024, the Company issued 60,258 shares under the 2022 Equity Plan, to its securities counsel for services performed.

fair value of the shares was $ 69,297 , based on the closing traded price of the common stock on

the date of grant .

January 5, 2024, the Company retained PCG to provide strategic advisory and investor relations services pursuant to an Advisory Agreement

under which the Company agreed to issue PCG an aggregate 22,500 shares of the Company’s common stock as payment for services in

lieu of cash for the months of January, February, and March 2024.

The aggregate fair value of the shares was $ 36,019 , based on the

closing traded price of the common stock on the dates of grant .

The shares were subsequently issued on April 15, 2024 under the

2022 Equity Plan.

Stock Issued for Services for the Year Ended December 31, 2023

November 1, 2023, the Company issued 24,478 shares under the 2022 Equity Plan to its securities counsel for services performed.

6 unchanged sentences

price of the common stock on the date of grant .

TO CONSOLIDATED FINANCIAL STATEMENTS

August 17, 2023, the Company issued 44,334 shares under the 2022 Equity Plan, to its securities counsel for services performed.

2 unchanged sentences

the date of grant .

Stock Issued for Services for the Year Ended December 31, 2022

April 30, 2022, the Company awarded 1,000 shares of common stock to a consultant for services provided.

The fair value of the common

stock was $ 4,125 based on recent sales of common stock to third parties.

January 17, 2022, the Company awarded 4,920 shares of common stock to a consultant for services provided.

The fair value of the common

stock was $ 20,295 based on recent sales of common stock to third parties.

connection with the IPO, a total of $ 6,029,204 of convertible debt, consisting of $ 5,526,691 of principal and $ 502,513 of interest, was

converted into 1,572,171 shares of common stock, inclusive of $ 179,687 , consisting of $ 165,000 of principal and $ 14,687 of interest,

that converted into 43,562 shares of common stock issued upon the conversion of debts held by related parties.

The notes were converted

in accordance with the conversion terms;

connection with the IPO in June 2023, a total of $ 6,029,204 of convertible debt, consisting of $ 5,526,691 of principal and $ 502,513 of

interest, was converted into 1,572,171 shares of common stock, inclusive of $ 179,687 , consisting of $ 165,000 of principal and $ 14,687

of interest, that converted into 43,562 shares of common stock issued upon the conversion of debts held by related parties.

were converted in accordance with the conversion terms;

therefore, no gain or loss had been recognized.

7 unchanged sentences

the 2022 Equity Plan was initially an aggregate of 600,000 shares, as adjusted on June 15, 2023 in connection with the Company’s

reverse stock split, subject to annual increases under the plan.

There were 169,304 options with a weighted average exercise price of

$ 3.47 per share outstanding as of December 31, 2023.

TO FINANCIAL STATEMENTS

reverse stock split, subject to annual increases under the plan, resulting in 1,009,000 reserved shares as of December 31, 2024.

were 593,470 options with a weighted average exercise price of $ 2.39 per share outstanding as of December 31, 2024.

Stock Options Issued for Services

October 24, 2023, the Company granted options to purchase an aggregate 42,500 shares of the Company’s common stock, having an exercise

price of $ 1.60 per share, exercisable over a 10 -year term, to a total of four employees.

The options will vest one -year from the date

The estimated value using the Black-Scholes Pricing Model, based on a volatility rate of 93 % and a call option value of $ 0.7118 ,

May 1, 2024, the Company granted options to purchase 30,000

shares of the Company’s common stock, having an exercise price of $ 2.40

per share, exercisable over a 10 -year

term, to a new employee.

The options will vest monthly over three years from the date of grant.

The aggregate estimated value using

the plain vanilla Black-Scholes Pricing Model, based on a volatility rate of 41 %

and a call option value of $ 1.1806 ,

and an expected term of 6.5 years, was $ 35,419 .

The options are being expensed over the vesting period, resulting in $ 7,872

of stock-based compensation expense during the year ended December 31, 2024.

As of December 31, 2024, a total of $ 27,547

of unamortized expenses are expected to be expensed over the vesting period.

February 22, 2024, the Company granted options to purchase an aggregate 315,000

shares of the Company’s common stock, having an exercise price of $ 1.92

per share, exercisable over a 10 -year

term, to a total of six employees, including options to purchase 140,000

shares issued to the Company’s CEO and CFO, respectively.

The options vested immediately.

The aggregate estimated value using

the plain vanilla Black-Scholes Pricing Model, based on a volatility rate of 41 %

and a call option value of $ 0.8581 , and an expected term of 5.5 years,

was $ 270,296 .

The options are being expensed over the vesting period, resulting in $ 5,672 of stock-based compensation expense during the

year ended December 31, 2023.

As of December 31, 2023, a total of $ 24,581 of unamortized expenses are expected to be expensed over the

remaining vesting period.

August 8, 2023, the Company granted options to purchase an aggregate 30,000 shares of the Company’s common stock under the 2022

Plan, having an exercise price of $ 6.00 per share, exercisable over a 10 -year term, to the chairman of the audit committee.

will vest monthly over a one -year period.

The estimated value using the Black-Scholes Pricing Model, based on a volatility rate of 39 %

and a call option value of $ 0.1644 , was $ 4,932 .

The options are being expensed over the vesting period, resulting in $ 1,952 of stock-based

compensation expense during the year ended December 31, 2023.

As of December 31, 2023, a total of $ 2,980 of unamortized expenses are

expected to be expensed over the remaining vesting period.

August 8, 2023, the Company granted options to purchase an aggregate 30,000 shares of the Company’s common stock under the 2022

Plan, having an exercise price of $ 2.51 per share, exercisable over a 10 -year term, to one of its directors.

The options will vest monthly

over a one-year period.

The estimated value using the Black-Scholes Pricing Model, based on a volatility rate of 39 % and a call option

value of $ 0.7885 , was $ 23,655 .

The options are being expensed over the vesting period, resulting in $ 9,364 of stock-based compensation

expense during the year ended December 31, 2023.

As of December 31, 2023, a total of $ 14,291 of unamortized expenses are expected to

be expensed over the remaining vesting period.

February 28, 2023, the Company awarded fully vested options to purchase 16,000 shares of common stock under the 2022 Plan at an exercise

price equal to $ 4.125 per share, exercisable over a ten -year period to an employee.

The estimated value using the Black-Scholes Pricing

Model, based on a volatility rate of 50 % and a call option value of $ 2.0249 , was $ 32,399 .

The options were expensed as stock-based compensation

expense during the year ended December 31, 2023.

September 19, 2022, the Company awarded options to purchase 10,004 shares of common stock under the 2022 Plan at an exercise price equal

to $ 4.125 per share, exercisable over a ten -year period to an employee.

One fourth of the options vest one year from the grant date,

and the remaining shares vest monthly over a thirty-six (36) month period from the 1-year anniversary of the grant date.

The estimated

value using the Black-Scholes Pricing Model, based on a volatility rate of 39 % and a call option value of $ 1.715 , was $ 17,155 .

are being expensed over the vesting period, resulting in $ 4,288 and $ 1,201 of stock-based compensation expense during the years ended

December 31, 2023 and 2022, respectively.

As of December 31, 2023, a total of $ 11,666 of unamortized expenses are expected to be expensed

over the vesting period.

January 2, 2022, the Company awarded options to purchase 40,800 shares of common stock under the 2022 Plan at an exercise price equal

to $ 4.125 per share, exercisable over a ten -year period to an employee.

The options vest monthly over a twenty-four (24) month period,

with the initial vesting commencing on January 2, 2022.

The estimated value using the Black-Scholes Pricing Model, based on a volatility

rate of 29 % and a call option value of $ 1.1578 , was $ 47,239 .

February 22, 2024, the Company also granted options to purchase an aggregate 79,166

shares of the Company’s common stock, having an exercise price of $ 1.92

per share, exercisable over a 10 -year

term, to a total of three of the Company’s directors.

The options vested immediately.

The aggregate estimated value using the

plain vanilla Black-Scholes Pricing Model, based on a volatility rate of 41 %

and a call option value of $ 1.1407 , and an expected term of 5.5 years,

was $ 90,306 .

October 24, 2023, the Company granted options to purchase an aggregate 42,500

shares of the Company’s common stock, having an exercise price of $ 1.60

per share, exercisable over a 10 -year

term, to a total of four employees.

The options will vest one-year from the date of grant.

The estimated value using the plain

vanilla Black-Scholes Pricing Model, based on a volatility rate of 93 %

and a call option value of $ 0.7118 ,

and an expected term of 5.5 years, was $ 30,253 .

The options were expensed over the vesting period, resulting in $ 24,581

and $ 23,620 of stock-based compensation expense during the years ended December 31, 2023 and 2022, respectively.

January 1, 2022, the Company awarded options to purchase 57,600 shares of common stock under the 2022 Plan at an exercise price equal

to $ 4.125 per share, exercisable over a ten -year period to the Company’s then Chief Financial Officer.

The options vest monthly

over an eighteen (18) month period, with the initial vesting commencing on January 1, 2022.

The estimated value using the Black-Scholes

Pricing Model, based on a volatility rate of 29 % and a call option value of $ 1.1531 , was $ 66,419 .

The options were expensed over the

vesting period, resulting in $ 23,619 and $ 44,280 of stock-based compensation expense during the years ended December 31, 2023 and 2022,

respectively.

The options terminated 90 days from the employee’s terminated services, on November 14, 2023.

TO FINANCIAL STATEMENTS

of stock-based compensation expense during the years ended December 31, 2024 and 2023, respectively.

August 8, 2023, the Company granted options to purchase an aggregate 30,000

shares of the Company’s common stock under the 2022 Plan, having an exercise price of $ 6.00

per share, exercisable over a 10 -year

term, to the chairman of the audit committee.

The options will vest monthly over a one-year period.

The estimated value using the

plain vanilla Black-Scholes Pricing Model, based on a volatility rate of 39 %

and a call option value of $ 0.1644 , and an expected term of 3 years,

was $ 4,932 .

The options were expensed over the vesting period, resulting in $ 2,980

of stock-based compensation expense during the years ended December 31, 2024 and 2023, respectively.

August 8, 2023, the Company granted options to purchase an aggregate 30,000

shares of the Company’s common stock under the 2022 Plan, having an exercise price of $ 2.51

per share, exercisable over a 10 -year

term, to one of its directors.

The options will vest monthly over a one-year period.

The estimated value using the plain vanilla

Black-Scholes Pricing Model, based on a volatility rate of 39 %

and a call option value of $ 0.7885 , and an expected term of 3 years,

was $ 23,655 .

The options were expensed over the vesting period, resulting in $ 14,291

of stock-based compensation expense during the years ended December 31, 2024 and 2023, respectively.

TO CONSOLIDATED FINANCIAL STATEMENTS

February 28, 2023, the Company awarded fully vested options to purchase 16,000

shares of common stock under the 2022 Plan at an exercise price equal to $ 4.125

per share, exercisable over a 10 ten-year

period to an employee.

The estimated value using the plain vanilla Black-Scholes Pricing Model, based on a volatility rate of 50 %

and a call option value of $ 2.0249 , and an expected term of 5 years,

was $ 32,399 .

The options were expensed as stock-based compensation expense during the year ended December 31, 2023.

following is a summary of information about the Stock Options outstanding at December 31, 2024.

1 unchanged sentence

Shares Underlying

Shares Underlying Options Outstanding

Options Exercisable

Exercise Prices

Underlying Options Outstanding

following is a summary of activity of outstanding stock options:

Schedule of Stock Options Outstanding Activity

of Activity of Outstanding Stock Options

Balance, December 31, 2022

Options granted

Options canceled

Balance, December 31, 2023

Options granted

Options canceled

Balance, December

3 unchanged sentences

remaining life of 5.11 years, were outstanding as of December 31, 2024.

Issued Pursuant to Convertible Note Financing

discussed in further detail in Note 4, on July 24, 2024, the Company issued to Kaufman Kapital, in a private placement (i) a 12 % Senior

Secured Convertible Promissory Note in the principal amount of up to $ 3,400,000 , (ii) a warrant to purchase 1,000,000 shares of common

stock at an exercise price of $ 1.00 per share, and (iii) a warrant to purchase 500,000 shares of common stock at an exercise price of

$ 1.50 per share, in consideration of an initial loan in the principal amount of $ 2,000,000 made to the Company under the Convertible

The proceeds received were allocated between the debt and warrants on a relative fair value basis.

The relative aggregate estimated

value of the $ 1.00 Warrants using the Black-Scholes Pricing Model, based on a weighted average volatility rate of 39 % and a weighted

average call option value of $ 0.2138 , was $ 20,303 , of which $ 6,214 was recognized as finance expense during the year ended December 31,

As of December 31, 2024, there was $ 14,089 of unamortized expenses expected to be expensed over the remaining life of the outstanding

The relative aggregate estimated value of the $ 1.50 Warrants using the Black-Scholes Pricing Model, based on a weighted average

volatility rate of 39 % and a weighted average call option value of $ 0.0768 , was $ 655 , of which $ 201 was recognized as finance expense

during the year ended December 31, 2024.

As of December 31, 2024, there was $ 454 of unamortized expenses expected to be expensed over

the remaining life of the outstanding debt.

TO CONSOLIDATED FINANCIAL STATEMENTS

Issued Pursuant to Unit Offering to Related Parties

July 15, 2024, the Company entered into Subscription Agreements with three related parties, consisting of Eric Healy, the Company’s

Chief Executive Officer;

Eagle Vision;

and the Company’s President, pursuant to which such investors agreed to purchase $ 525,000

of “Units” from the Company, each Unit consisting of (i) 100 shares of common stock, and (ii) a warrant to purchase 125 shares

of common stock over the following ten years at an exercise price of $ 1.00 per share, at a purchase price per Unit equal to $ 75.82 .

Company completed the sale of the Units to Eric Healy and the Company’s President on July 23, 2024, and the sale of the Units to

Eagle Vision on August 30, 2024, resulting in the issuance of an aggregate of 692,429 shares of common stock and warrants to purchase

865,536 shares of common stock.

Issued Pursuant to Underwriting Agreement

June 28, 2024, pursuant to the Underwriting Agreement, the Company executed and delivered to the Representative a common stock Purchase

Warrant (the “Representative’s Warrant”) to purchase up to 100,625 shares of Common Stock, which may be exercised beginning

on December 23, 2024 (the date that is 180 days following the commencement of sales of common stock in connection with the Offering (the

“Commencement Date”)) until June 26, 2029.

The initial exercise price of the Representative’s Warrant is $ 0.96 per

share, which is equal to 120% of the public offering price for the Shares .

Issued Pursuant to Debt Offering

various dates from January 9, 2024 through May 22, 2024 , the Company issued Warrants to

purchase an aggregate total of 518,750 shares of common stock at an exercise price of $ 2.00 per share in connection with the sale of

Senior Notes to a group of Investors led by Eagle Vision, in the aggregate principal amount of $ 1,675,000 .

The proceeds received were

allocated between the debt and warrants on a relative fair value basis.

The relative aggregate estimated value of the warrants using

the Black-Scholes Pricing Model, based on a weighted average volatility rate of 40 % and a weighted average call option value of $ 0.1560 ,

was $ 80,908 , which was recognized as finance expense during the year ended December 31, 2024.

of Senior Notes and Warrants

connection with the sale of the Purchased Securities to Kaufman Kapital under the SPA, the Company entered into an Omnibus Amendment

to Note Documents with substantially all of the Holders of the Company’s Senior Notes and Warrants issued under that certain Subscription

Agreement dated as of January 10, 2024, as amended, pursuant to which, among other things, (i) the exercise price of the Warrants issued

to the Holders was reduced from $ 2.00 to $ 1.00 , (ii) the outside maturity date of the Senior Notes held by the Holders was extended from December 31, 2024 to December 31, 2025 (subject to further extension in the event the maturity date of the Convertible Note is extended),

(iii) the Company’s obligation to make payments of principal under the Senior Notes held by the Holders beginning July 1, 2024

has been eliminated, and instead all obligations of the Company under such Senior Notes will be due in one lump sum on the maturity date

of the Senior Notes, and (iv) the Company’s obligations under the Convertible Note and liens granted to the holder thereof, will

be pari passu with the Company’s obligations under the Senior Notes held by the Holders and liens granted to the holders thereof.

The amendment warrants resulted in $ 89,949 of additional interest expense.

Issued Pursuant to Debt Offering

July 1, 2023 , the Company issued warrants to purchase an aggregate total of 30,000 shares

14 unchanged sentences

Model, based on a weighted average volatility rate of 54 % and a weighted average call option value of $ 1.7981 , was $ 147,639 .

to Common Stock Warrants for the Year Ended December 31, 2022

March 7, 2022, the Company amended outstanding warrants previously issued pursuant to the sale of convertible debt securities.

terms immediately prior to the amendments consisted of the option to purchase an aggregate 16.5 % of the Company’s then-outstanding

capital stock, calculated on a fully diluted basis as of the time of exercise, at an aggregate exercise price of $ 2,250,000 , which were

subsequently amended to purchase an aggregate 343,413 shares of common stock at a weighted average exercise price of $ 6.77 per share,

exercisable over the remaining useful lives on a weighted average basis of 7.12 years.

The additional fair value of the warrants, in

the amount of $ 377,200 , was expensed as stock-based compensation within professional fees on the statements of operations.

TO FINANCIAL STATEMENTS

to Purchase Common Stock Issued as Promissory Note Commitments for the Year Ended December 31, 2022

Company paid a commitment fee in connection with the issuance of the Fluffco Convertible Note on June 6, 2022, consisting of warrants

to purchase 3,394 shares of common stock at an exercise price of $ 7.50 per share over a five -year term.

The estimated value using the

Black-Scholes Pricing Model, based on a volatility rate of 35 % and a call option value of $ 0.6697 , was $ 2,273 .

The warrants were expensed

over the vesting period, resulting in $ 2,273 of stock-based compensation expense during the year ended December 31, 2022.

Company paid a commitment fee in connection with the issuance of the Foss Convertible Note on May 26, 2022, consisting of warrants to

purchase 18,334 shares of common stock at an exercise price of $ 7.50 per share over a five-year term.

The estimated value using the Black-Scholes

Pricing Model, based on a volatility rate of 34 % and a call option value of $ 0.6424 , was $ 11,777 .

The warrants were expensed over the

vesting period, resulting in $ 11,777 of stock-based compensation expense during the year ended December 31, 2022.

TO CONSOLIDATED FINANCIAL STATEMENTS

following is a summary of information about our warrants to purchase common stock outstanding at December 31, 2024.

of Warrants to Purchase Common Stock Outstanding

Shares Underlying

Shares Underlying Warrants Outstanding

Warrants Exercisable

Underlying Warrants Outstanding

fair value of each warrant grant is estimated on the date of grant using the Black-Scholes option pricing model with the following weighted-average

assumptions used for grants under the fixed option plan:

of Weighted-Average Assumptions Used for Grants Under the Fixed Option Plan

of Weighted-Average Assumptions Used for Grants Under Fixed Option Plan

Average risk-free interest rates

5 unchanged sentences

Balance, December 31, 2022

Warrants granted

Balance, December 31, 2023

Warrants granted

Balance, December

Exercisable, December

TO FINANCIAL STATEMENTS

21 – Income Taxes

8 unchanged sentences

company to a corporation) through December 31, 2024 were assuming a 21 % effective tax rate.

TO CONSOLIDATED FINANCIAL STATEMENTS

components of the Company’s deferred tax asset are as follows:

1 unchanged sentence

Deferred tax assets:

Net operating loss carry forwards

operating loss carry forwards

Net deferred tax assets before valuation allowance

1 unchanged sentence

( 1,997,520 )

Net deferred tax assets

( 1,680,000 )

deferred tax assets

Company has incurred cumulative losses which make realization of a deferred tax asset difficult to support in accordance with ASC 740.

4 unchanged sentences

accordance with ASC 740, the Company has evaluated its tax positions and determined there are no uncertain tax positions.

22 – Segment Reporting

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

The Company’s products are currently manufactured at its new production facility that commenced production in Pisco Peru in December

2024, and is supported by contract manufacturers in Peru, as necessary.

The Company’s customers are located throughout the United

The Company’s sales operations, which represent 100% of the Company’s consolidated sales, are one of its two reportable

The sales operations’ segment revenues are predominately earned as consumer products are sold to big box retail customers

throughout the United States and via the Company’s online platform.

The Company aggregates its operating divisions into two reportable

segments due to the operating divisions having similar economic characteristics with similar long-term financial performance, but different

geographic locations.

The Company’s sales occur entirely from, and within, the United States, while all of the Company’s

production processes are conducted in Latin America, which represent its other operating segment.

In addition, the Company’s operating

divisions offer customers the same products, operate in similar regulatory environments, purchase the majority of the merchandise for

retail sale from similar (and in many cases identical) vendors on a coordinated basis from a centralized location, serve of the same

customers, and are allocated capital from a centralized location.

Operating divisions are organized primarily on a geographical basis

so the operating division management team can be responsive to local needs of the operating division and can execute company strategic

plans and initiatives throughout the locations in their operating division.

This geographical separation is the primary differentiation

between these operating divisions.

The geographical basis of organization reflects how the business is managed and how the Company’s

Chief Executive Officer, who acts as the Company’s chief operating decision maker (“CODM”), assesses performance internally.

accounting policies of the retail operations segment are the same as those described in the summary of significant accounting policies

in Note 3 to the Consolidated Financial Statements.

The Company’s CODM assesses performance and allocates resources for the retail

operations segment using segment earnings before net interest expense, income tax expense and depreciation and amortization (“EBITDA”).

The Company defines EBITDA as earnings before interest taxes and depreciation.

The Company’s CODM also uses segment EBITDA to measure

the operational effectiveness of the Company’s financial model, compare the performance of core operating results between periods,

against budget and against competitors and evaluate whether to invest capital in the retail operations segment or in other parts of the

Company, such as for share repurchases, debt repayments or capital expenditures.

The Company’s CODM is not provided asset information

by reportable segment as asset information is provided to the CODM on a consolidated basis.

The Company’s capital expenditures

are predominately used in the Company’s production operations, rather than its retail operations.

TO CONSOLIDATED FINANCIAL STATEMENTS

following table presents the Company’s retail operations segment revenue, measure of segment profit or loss, significant segment

expenses and reconciliation of the U.S.

and Latin America operations segments’ EBITDA to consolidated net earnings before income

tax expense for the years ended December 31, 2024 and 2023:

of Segment Reporting

For the Years Ended

segment sales

Latin American operations

segment cost of goods sold

operations segment expenses:

General and administrative

Salaries and wages

Professional fees

operating expenses

operations segment EBITDA

$ ( 580,073 )

Latin American operations

segment cost of goods sold

Latin American operations segment expenses:

General and administrative

Salaries and wages

Professional fees

Latin American operating expenses

Operating expenses

American operations segment EBITDA

$ ( 6,346,231 )

$ ( 2,698,229 )

Consolidated EBITDA

$ ( 3,730,568 )

$ ( 3,278,302 )

Reconciliation of net

earnings before income tax expense:

Consolidated EBITDA

$ ( 3,730,568 )

$ ( 3,278,302 )

$ ( 3,730,568 )

$ ( 3,278,302 )

Interest income

Interest expense

net loss before income tax expense

$ ( 4,751,516 )

$ ( 3,925,710 )

23 – Subsequent Events

1 unchanged sentence

No events occurred of a material nature that would have required adjustments to or disclosure in these financial statements except

January 10, 2024, the Company completed the sale of $ 400,000 of Senior Secured Promissory Notes (“Notes”) and Warrants (“Warrants”)

to purchase an aggregate of 100,000 shares of the Company’s common stock, to a group of six investors (the “Investors”)

led by Eagle Vision Fund LP (“Eagle Vision”), an affiliate of John Dalfonsi, CFO of the Company, pursuant to a Subscription

Agreement between the Company and the Investors (the “Subscription Agreement”).

to the Subscription Agreement, Eagle Vision was paid a cash fee in the amount of $ 40,000 upon the closing of the transaction for due

diligence fees.

Notes mature on the earlier of December 31, 2024, or the occurrence of a Qualified Subsequent Financing or Change of Control (as such

terms are defined in the Subscription Agreement) and bear interest at a rate of 15 % per annum.

In addition, the Notes are subject to

covenants, events of defaults and other terms and conditions set forth in the Subscription Agreement.

The Company’s obligations

under the Notes are secured by liens on substantially all of the Company’s assets pursuant to the terms of a Security Agreement

between the Company and the Investors (the “Security Agreement”).

Warrant is exercisable for a ten -year period at an exercise price of $ 2.00 per share.

to the Subscription Agreement, the proceeds received by the Company from the sale of the Notes and Warrants were used to repay outstanding

indebtedness owed by the Company to John Hinman in the principal amount of $ 200,000 , with the balance to be used for working capital

Stock Options Issued for Services

February 22, 2024, the Company granted options to purchase an aggregate 315,000 shares of the Company’s common stock, having an

exercise price of $ 1.92 per share, exercisable over a 10 -year term, to a total of six employees, including options to purchase 140,000

and 75,000 shares issued to the Company’s CEO and CFO, respectively.

The options vested immediately.

The aggregate estimated value

using the Black-Scholes Pricing Model, based on a volatility rate of 41 % and a call option value of $ 0.8581 , was $ 270,296 .

February 22, 2024, the Company also granted options to purchase an aggregate 79,166 shares of the Company’s common stock, having

an exercise price of $ 1.92 per share, exercisable over a 10 -year term, to a total of three of the Company’s directors.

vested immediately.

The aggregate estimated value using the Black-Scholes Pricing Model, based on a volatility rate of 41 % and a call

option value of $ 1.1407 , was $ 90,306 .

February 18, 2025, the Company entered into entered into a First Amendment to the ATM Agreement to increase the aggregate offering price

of the Shares that the Company may sell under the ATM Agreement to up to $ 5,000,000 .

Subsequent to December 31, 2024, the Company sold

a total of 1,303,115 shares of common stock, including 182,693 shares authorized, but unissued at December 31, 2024, at prevailing market

prices under the ATM Agreement for aggregate net proceeds of $ 2,407,448 , after deducting applicable expenses, including a commission

paid to Alexander Capital equal to 3 % of the gross proceeds from the sale of the shares.

February 14, 2025, the Company received aggregate proceeds of $ 38,157 on the exercise of Representative’s Warrants to purchase

an aggregate of 39,747 shares of common stock.

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data