What changed in this filing

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Item 1A. Risk Factors

2023-03-02 compared with 2022-03-10 · 73 added, 62 removed, 333 unchanged (29% of the section changed)

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of time thereby disrupting sales of product into that channel.

More recently, we have experienced a disruption in the supply chain

for manufacturing our products due to COVID-19.

The developments surrounding COVID-19 remain fluid and dynamic, and consequently, will

require the Company to continue to monitor news headlines from government and health officials, as well as, the business community.

More recently, we have experienced a disruption in the supply chain for

manufacturing our products due to COVID-19.

The developments surrounding COVID-19 remain fluid and dynamic, and consequently, will require

the Company to continue to monitor news headlines from government and health officials, as well as, the business community.

Related to Our Business

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or otherwise respond to competitive pressures, could be significantly limited.

with a manufacturer have resulted in a significant loss for 2022, as well as other negative impacts.

described more fully in Item 7, we experienced product quality issues with a contract manufacturer (the “Manufacturer”) that

provided approximately 52% and 42% of our products in the years ended December 31, 2022 and 2021.

Complaints from customers led us to

withdraw product from the market and destroy existing inventory.

The results for 2022 reflect the estimated accounting impact of these

actions, including $493,000 in refunds and administrative fees due to customers and $932,000 to dispose of unsaleable inventory.

addition to the accounting impact, we must obtain suitable replacement contract manufacturers and regain the confidence of our customers

and investing public, all while seeking a resolution with the Manufacturer.

These tasks require substantial amounts of personnel and

capital resources.

As of the filing of this report, we are unable to predict the impact on our results for the 2023 fiscal year.

may need additional financing in the future, which may not be available when needed or may be costly and dilutive.

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condition and results of operations.

addition, our reliance on a limited number of manufacturers and suppliers could further increase this risk.

Most of our suppliers and

manufacturers produce similar products for other companies, and our products may represent a small portion of their businesses.

it takes a newly engaged manufacturer typically up to nine months of retrofitting/ preparation before it can begin producing our products.

experience with the Manufacturer demonstrates how our reliance on a limited number of manufacturers and suppliers further increases this

Most of our suppliers and manufacturers produce similar products for other companies, and our products may represent a small portion

of their businesses.

Further, it takes a newly engaged manufacturer typically up to nine months of retrofitting/ preparation before it

can begin producing our products.

We have contracts in place to produce sufficient units to meet projected demand;

however, if one of our manufacturers fails to

perform, we would be faced with a significant interruption in our supply chain.

If one of our manufacturers or suppliers fails to perform

or deliver products, for any reason, our sales and results of operations could be adversely affected.

Furthermore, if we are unable to

meet our customers’ demands due to a disruption in our supply chain, we may lose that customer which could adversely affect our

business, financial condition and results of operations.

however, if one of

our manufacturers fails to perform, we would be faced with a significant interruption in our supply chain.

If one of our manufacturers

or suppliers fails to perform or deliver products, for any reason, our sales and results of operations could be adversely affected.

if we are unable to meet our customers’ demands due to a disruption in our supply chain, we may lose that customer which could

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

dependence on independent contract manufacturers could make management of our manufacturing and distribution efforts inefficient or unprofitable.

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effective relationships with those distributors and key accounts.

At present, we must replace the Manufacturer with one or more new contract

manufacturers and/or arrange for increased production from our existing contract manufacturers, all of which require several months to

we do not adequately manage our inventory levels, our operating results could be adversely affected.

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costs such as paper and aluminum cans have experienced industry wide price increases in the past and there is always the risk that the

Company’s co-packers increase their toll rates based on increases in their fixed and variable costs.

If the Company is unable

to pass on these costs, the gross margin will be significantly impacted.

Company’s contract manufacturers increase their toll rates based on increases in their fixed and variable costs.

If the Company

is unable to pass on these costs, the gross margin will be significantly impacted.

or legal proceedings could expose us to significant liabilities and damage our reputation.

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well as disgorgement of profits.

the litigation with the Manufacturer has been voluntarily moved from the court system, there is no assurance that we will be able to

reach a suitable resolution with the Manufacturer and not be forced to refile our case with the court.

have identified a material weakness in our disclosure controls and procedures and internal control over financial reporting.

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Company is committed to remediating its material weaknesses as promptly as possible.

Implementation of the Company’s remediation

plans has commenced and is being overseen by the audit committee.

However, there can be no assurance as to when these material weaknesses

will be remediated or that additional material weaknesses will not arise in the future.

Even effective internal control can provide only

reasonable assurance with respect to the preparation and fair presentation of financial statements.

Implementation of the Company’s

remediation plans has commenced , including adding appropriate staffing and implementing an improved information system.

is being overseen by the audit committee.

However, there can be no assurance as to when these material weaknesses will be remediated

or that additional material weaknesses will not arise in the future.

Even effective internal control can provide only reasonable

assurance with respect to the preparation and fair presentation of financial statements.

Any failure to remediate the material

weaknesses or the development of new material weaknesses in our internal control over financial reporting, could result in material misstatements

in our financial statements, which in turn could have a material adverse effect on our financial

condition and the trading price of our common stock and we could fail to meet our financial reporting obligations.

weaknesses or the development of new material weaknesses in our internal control over financial reporting, could result in material

misstatements in our financial statements, which in turn could have a material adverse effect

on our financial condition and the trading price of our common stock and we could fail to meet our financial reporting

in various food and supply costs, particularly fruit and dairy, could adversely affect our operating results.

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If one or more of our senior

executives is unable or unwilling to continue to work for us in his present position, we may have to spend a considerable amount of time

and resources searching, recruiting, and integrating a replacement into our operations, which would substantially divert management’s

executives is unable or unwilling to continue to work for us in his or her present position, we may have to spend a considerable amount

of time and resources searching, recruiting, and integrating a replacement into our operations, which would substantially divert management’s

attention from our business and severely disrupt our business.

This may also adversely affect our ability to execute our business strategy.

senior management’s limited experience managing a publicly traded company may divert management’s attention from operations

and harm our business.

senior management team has relatively limited experience managing a publicly traded company and complying with federal securities laws,

including compliance with recently adopted disclosure requirements on a timely basis.

Our management will be required to design and implement

appropriate programs and policies in responding to increased legal, regulatory compliance and reporting requirements, and any failure

to do so could lead to the imposition of fines and penalties and harm our business.

may be unable to attract and retain qualified, experienced, highly skilled personnel, which could adversely affect the implementation

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Our failure to develop or license a substitute technology could prevent us from selling our products.

securities or industry analysts do not publish research, or publish inaccurate or unfavorable research, about our business, our share

price and trading volume could decline.

trading market for our common stock may be impacted, in part, by the research and reports that securities or industry analysts publish

about our business or us.

There can be no assurance that analysts will cover us, continue to cover us or provide favorable coverage.

If one or more analysts downgrade our stock or change their opinion of our stock, our share price may decline.

In addition, if one or

more analysts cease coverage of our company or fail to regularly publish reports on us, we could lose visibility in the financial markets,

which could cause our share price or trading volume to decline.

will continue to incur increased costs as a result of operating as a public company, and our management will be required to devote substantial

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common stock would only be tradable on the “Pink Sheets” and could suffer a decrease in or absence of liquidity.

securities or industry analysts do not publish research, or publish inaccurate or unfavorable research, about our business, our share

price and trading volume could decline.

trading market for our common stock may be impacted, in part, by the research and reports that securities or industry analysts publish

about our business or us.

There can be no assurance that analysts will cover us, continue to cover us or provide favorable coverage.

If one or more analysts downgrade our stock or change their opinion of our stock, our share price may decline.

In addition, if one or

more analysts cease coverage of our company or fail to regularly publish reports on us, we could lose visibility in the financial markets,

which could cause our share price or trading volume to decline.

we became public by means of a “reverse merger”, we may not be able to attract the attention of major brokerage firms.

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shares of common stock will result in dilution to our shareholders and may create downward pressure on the trading price of our common

in our Company charter documents and under Delaware law could make an acquisition of our company, which may be beneficial to our

stockholders, more difficult and may prevent attempts by our stockholders to replace or remove our current management.

in our Company charter documents and under Delaware law could make an acquisition of our company, which may be beneficial to our stockholders,

more difficult and may prevent attempts by our stockholders to replace or remove our current management.

in our certificate of incorporation and our bylaws may discourage, delay or prevent a merger, acquisition or other change in control

of our Company that stockholders may consider favorable, including transactions in which they might otherwise receive a

premium for their shares.

These provisions could also limit the price that investors might be willing to pay in the future for

shares of our common stock, thereby depressing the market price of our common stock.

In addition, because our board of directors is responsible

for appointing the members of our management team, these provisions may frustrate or prevent any attempts by our stockholders to replace

or remove our current management by making it more difficult for stockholders to replace members of our board of directors.

because we are incorporated in Delaware, we are governed by the provisions of Section 203 of the Delaware General Corporation Law, which

prohibits a person who owns in excess of 15% of our outstanding voting stock from merging or combining with us for a period of three

years after the date of the transaction in which the person acquired in excess of 15% of our outstanding voting stock, unless the merger

or combination is approved in a prescribed manner.

of our Company that stockholders may consider favorable, including transactions in which they might otherwise receive a premium for their

These provisions could also limit the price that investors might be willing to pay in the future for shares of our common stock,

thereby depressing the market price of our common stock.

In addition, because our board of directors is responsible for appointing the

members of our management team, these provisions may frustrate or prevent any attempts by our stockholders to replace or remove our current

management by making it more difficult for stockholders to replace members of our board of directors.

In addition, because we are incorporated

in Delaware, we are governed by the provisions of Section 203 of the Delaware General Corporation Law, which prohibits a person who owns

in excess of 15% of our outstanding voting stock from merging or combining with us for a period of three years after the date of the

transaction in which the person acquired in excess of 15% of our outstanding voting stock, unless the merger or combination is approved

in a prescribed manner.

board of directors controls the majority of the outstanding shares of voting stock.

present, members of our board of directors and/or their affiliated entities control over 60% of the outstanding shares of voting stock,

and therefore have the power to control all matters requiring the approval of our stockholders, including the election of directors and

the approval of mergers and other significant corporate transactions.

Unresolved Staff Comments.

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this office space pursuant to a direct lease for approximately $80,000 annually through March 31, 2023.

Legal Proceedings.

the Company nor its subsidiaries are party to or have property that is the subject of any material pending legal proceedings.

be subject to ordinary legal proceedings incidental to our business from time to time that are not required to be disclosed under this

Mine Safety Disclosures.

The Company extended its lease through June 2023 while management evaluates options for renewal or relocation.

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 1A. Risk Factors