Legal Proceedings
−Removed: We are not currently a party to any litigation or claims that, if determined adversely against us, would have a material adverse effect on our business operating results, financial condition, or cash flows.
+Added: We are not currently a party to any litigation
+Added: or claims that, if determined adversely against us, would have a material adverse effect on our business operating results, financial
+Added: condition, or cash flows.
We may, from time to time, be party to litigation and subject to claims in the ordinary course of business.
−Removed: Regardless of the outcome, litigation can have an adverse impact on us because of the defense and settlement costs, diversion of management resources, and other factors.
−Removed: You should consider carefully the risks and uncertainties described below or incorporated by reference in our Form S-4 filed with the SEC on January 11, 2024, Form 8-K/A filed with the SEC on April 15, 2024, together with all of the other information contained in this Quarterly Report.
−Removed: If any of the following events occur, our business, financial condition and operating results may be materially adversely affected.
−Removed: In that event, the trading price of our securities could decline, and you could lose all or part of your investment.
−Removed: The risks and uncertainties described below are not the only ones we face.
−Removed: Additional risks and uncertainties that we are unaware of, or that we currently believe are not material, may also become important factors that adversely affect our business or results of operations.
−Removed: Risk Factors (continued)
−Removed: We have a limited operating history which makes it difficult to evaluate our business and prospects.
−Removed: We have a limited operating history, which makes it difficult to evaluate our business and prospects to forecast our future results.
−Removed: We were founded in 2019.
−Removed: Although we have experienced substantial revenue growth on an
−Removed: annual basis, we have incurred losses since inception.
−Removed: As of September 30, 2024, we had an approximate accumulated deficit of $85.0 million.
−Removed: There can be no assurance that revenue growth will continue in the future.
−Removed: In addition, we may experience substantial fluctuations in operating results in the future caused by various factors, including:
−Removed: ● general economic conditions;
−Removed: ● specific economic conditions in the food and agriculture industry;
−Removed: ● the impact of inflation and rising interest rates across the economy, including higher food, grocery, raw materials, transportation, energy, labor and fuel costs;
−Removed: ● increases in the price of raw materials, labor, wages or other inputs that our suppliers use in manufacturing and supplying products, along with logistics, transportation, shipping and other related costs, may lead to higher production and shipping costs for our products.
−Removed: Any increase in the cost of inputs to our production could lead to higher costs for products in retail channels and could negatively impact our operating results and future profitability;
−Removed: ● the introduction of new products by us or our competitors;
−Removed: ● the mix of products sold and the mix of channels through which those products are sold.
−Removed: As a strategic response to a changing competitive environment, we may elect from time to time to make, among other things, certain pricing, product, or marketing decisions, and any such decisions could have a material adverse effect on our periodic results of operations, including revenue and profits from quarter to quarter.
−Removed: Our independent registered public accounting firm has expressed substantial doubt about our ability to continue as a going concern.
−Removed: Our historical financial statements have been prepared under the assumption that it will continue as a going concern.
−Removed: Our registered public accounting firm has issued a report on our financial statements for the years ended December 31, 2023 and 2022, that includes an explanatory paragraph expressing substantial doubt in our ability to continue as a going concern.
−Removed: As of September 30, 2024, we had cash-on-hand of $721,542 and negative working capital of ($16.87 million).
−Removed: Our ability to continue as a going concern is dependent on our ability to obtain additional equity or debt financing.
−Removed: Our financial statements do not include any adjustments that might result from the outcome of this uncertainty.
−Removed: However, if adequate funds are not available to us when
−Removed: Risk Factors (continued)
−Removed: we need them, we could go into default on our outstanding indebtedness, which would, in turn, permit our creditors to enforce remedies against us and cause us to consider reducing, discontinuing, or selling operations
−Removed: or seeking protection from creditors, and further raise substantial doubt about our ability to continue as a going concern.
−Removed: The doubt regarding our potential ability to continue as a going concern may adversely affect our ability to obtain new financing on reasonable terms or at all.
−Removed: Additionally, if we are unable to continue as a going concern, our shareholders may lose some or all of their investment in Borealis Foods.
−Removed: If we fail to maintain adequate operational and financial resources, particularly if we continue to grow rapidly, we may be unable to execute our business plan or maintain our competitive position and high-level customer satisfaction.
−Removed: We must continue to expand in order to maintain our competitive position and continue to meet our customers’ increasing demands for product, variety, quality and availability, and price/performance targets.
−Removed: Our ability to grow depends, to a significant extent, on our ability to expand our food processing operations, which requires significant advance capital expenditures, as well as advance expenditures and commitments for facilities, personnel, and advertising.
−Removed: Timely access to capital markets is essential for us to achieve our business plan.
−Removed: We will need to raise additional capital from equity or debt sources in order to address our liquidity deficiency and to finance our growth and capital expenditures contemplated for future periods.
−Removed: There can be no assurance that we will be able to raise such capital on favorable terms or at all.
−Removed: In the event that we are unable to obtain such additional capital, we may be required to reduce the scope of our presently anticipated expansion.
−Removed: Our inability to achieve projected growth could have a material adverse effect on our results of operations and could adversely impact our ability to compete.
−Removed: The war in Ukraine, and the sanctions in place, could adversely affect global energy and financial markets thus potentially affecting our business and customers.
−Removed: The outbreak of war in Ukraine has already affected global economic markets, including a dramatic increase in the price of oil and gas, and the uncertain resolution of this conflict could result in protracted and/or severe damage to the global economy.
−Removed: Russia’s military interventions in Ukraine have led to, and may lead to, additional sanctions being levied by the United States, European Union, and other countries against Russia.
−Removed: Russia’s military incursion and the resulting sanctions could adversely affect global energy and financial markets and thus could affect the global markets, our customers’ businesses and potentially our business.
−Removed: At this time, we (i) do not have any direct business or contracts with any Russian or Ukraine entity as a supplier or customer, (ii) do not have any knowledge whether any of our customers or suppliers have any direct business or contracts with any Russian entity, (iii) do not believe that our business segments, products, lines of service, projects or operations are materially impacted by supply chain disruptions resulted from the war in Ukraine, and (iv) have not been materially financially affected by the war in Ukraine.
−Removed: The extent and duration of the military action, sanctions, and resulting market disruptions are impossible to predict, but could be substantial.
−Removed: Any such disruptions caused by Russian military action or resulting sanctions may magnify the impact of other risks described in this section.
−Removed: Risk Factors (continued)
−Removed: We cannot predict the progress or outcome of the situation in Ukraine, as the conflict and governmental reactions are rapidly developing and beyond their control.
−Removed: Prolonged unrest, intensified military activities, or more extensive sanctions impacting the region could have a material adverse effect on the global economy, and such effect could in turn have a material adverse effect on our business, financial condition, results of operations, and prospects.
−Removed: We do not anticipate any new or heightened risk of potential cyberattacks by state actors or others since Russia’s invasion of Ukraine, and we have not taken any actions to mitigate such potential risks.
−Removed: Our management team will continue to monitor any potential risks that might arise due to the war in Ukraine which are specific to us, including but not limited to risks related to cybersecurity, sanctions, and supply chain, suppliers, or service providers in affected regions.
−Removed: We face market competition, and if we are unable to compete effectively with our competitors, our business and operating results could be materially adversely affected.
−Removed: The food and agriculture business is highly competitive, and faces increased competition as a result of consolidation, channel proliferation, and the growth of online food retailers and new market participants.
−Removed: Currently, the leading providers of food and agriculture products include large food and agriculture companies, as well as a number of smaller companies.
−Removed: Many of these companies possess financial resources significantly greater than those of ours, and accordingly, could initiate and support prolonged price competition to gain market share.
−Removed: In particular, the large food and agriculture companies could significantly undercut our pricing for our products.
−Removed: If significant price competition were to develop, we likely would be forced to lower our prices, possibly for a protracted period, which would have a material adverse effect on our financial results and could threaten our economic viability.
−Removed: In addition, many of these large competitors possess marketing, agricultural and food processing resources greater than those of ours.
−Removed: Smaller competitors, although often faced with financial barriers, typically compete on the basis of their ability to create niche markets by rapidly introducing products of interest to local customers and then expanding.
−Removed: The resulting price pressure and niche loyalties present substantial competitive challenges for us.
−Removed: Our management team has limited experience managing a public company.
−Removed: Some members of our management team have limited experience managing a publicly traded company, interacting with public company investors, and complying with the increasingly complex laws pertaining to public companies.
−Removed: Our management team may not successfully or efficiently manage our transition to being a public company that is subject to significant regulatory oversight and reporting obligations under the federal, foreign and state or provincial securities laws and the continuous scrutiny of securities analysts and investors.
−Removed: These new obligations and constituents will require significant attention from our senior management and could divert their attention away from the day-to-day management of our business, which could harm our business, results of operations, and financial condition.
+Added: Regardless of the outcome, litigation can have an adverse impact on us because of the defense and settlement costs, diversion of management
+Added: resources, and other factors.
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.