Item 1A. Risk Factors
Item
1A. Risk Factors.
Our risk factors are described in our Annual Report
on Form 10-K, as filed with the SEC on March 27, 2025, as updated below.
Disruption within
our supply chain, contract manufacturing or distribution channels could have an adverse effect on our business, financial condition and
results of operations.
Our ability, through our suppliers, business partners,
contract manufacturers, independent distributors and retailers, to produce, transport, distribute and sell products is critical to our
success.
Damage or disruption to our suppliers or to manufacturing
or distribution capabilities due to weather, natural disaster, fire or explosion, terrorism, pandemics such as COVD-19 and influenza,
labor strikes or other reasons, could impair the manufacture, distribution and sale of our products. Many of these events are outside
of our control. Failure to take adequate steps to protect against or mitigate the likelihood or potential impact of such events, or to
effectively manage such events if they occur, could adversely affect our business, financial condition and results of operations.
Our experience with the Manufacturer demonstrates
how our reliance on a limited number of manufacturers and suppliers further increases 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. Further, it takes a
newly engaged manufacturer typically up to nine months of retrofitting/ preparation before it can begin producing our products. In 2023
and 2024 we did not have contracts in place to produce sufficient units to meet projected demand. If one of our manufacturers fails to
perform or renew our contract, we could be faced with a significant interruption in our supply chain. If one of our manufacturers or suppliers
fails to perform or deliver products or renew our contract, 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.
We have received notification that a contract manufacturer of our Twist
& Go smoothie bottles will not renew our contract and will cease providing product on February 1, 2026. We are working with both
new and existing manufacturers to replace and increase that volume. However, there can be no assurance that our plans to replace the
lost volume will be successful.
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