What changed in this filing

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Item 1A. Risk Factors

2025-07-11 compared with 2024-03-29 · 611 added, 421 removed, 388 unchanged (73% of the section changed)

Risk Factors.

You should carefully consider

the risks described below as well as other information provided to you in this document, including information in the section of this

document entitled “Cautionary Note Concerning Forward Looking Statements.” If any of the following risks actually occur,

the Company’s business, financial condition or results of operations could be materially adversely affected, the value of the Company’s

Common Stock could decline, and you may lose all or part of your investment.

You should carefully consider the

risks described below as well as other information provided to you in this document, including information in the section of this document

entitled “Cautionary Note Concerning Forward Looking Statements.” If any of the following risks actually occur, the Company’s

business, financial condition or results of operations could be materially adversely affected, the value of the Company’s Common

Stock could decline, and you may lose all or part of your investment.

RISKS RELATED TO OUR BUSINESS

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Rose, Snyder & Jacobs LLP,

our independent registered public accounting firm for the fiscal year ended December 31, 2023, has included an explanatory paragraph

in their opinion that accompanies our audited consolidated financial statements as of and for the year ended December 31, 2023, indicating

our independent registered public accounting firm for the fiscal year ended December 31, 2024, has included an explanatory paragraph in

their opinion that accompanies our audited consolidated financial statements as of and for the year ended December 31, 2024, indicating

that our current liquidity position raises substantial doubt about our ability to continue as a going concern.

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our liquidity position, we may not be able to continue as a going concern.

We have sustained recurring losses

and we have had working capital and stockholders’ equity deficits.

These prior losses and expected future losses have had,

and will continue to have, an

adverse effect on our financial condition.

In addition, continued operations and our ability to continue as a going concern may be dependent

on our ability to obtain additional financing in the near future and thereafter, and there are no assurances that such financing will

be available to us at all or will be available in sufficient amounts or on reasonable terms.

Our financial statements do not include

any adjustments that may result from the outcome of this uncertainty.

If we are unable to generate additional funds in the future through

sales of our products, financing or from other sources or transactions, we will exhaust our resources and will be unable to continue

If we cannot continue as a going concern, our shareholders would likely lose most or all of their investment in us.

Management recognizes that it

may be required to obtain additional resources via issuances of indebtedness or equity to successfully execute its business plans.

assurances can be given that management will be successful in raising additional capital, if needed, or on acceptable terms.

These conditions

raise substantial doubt about the Company’s ability to continue as a going concern for the next 12 months.

We have sustained recurring

losses and we have had working capital and stockholders’ equity deficits.

These prior losses and expected future losses have

had, and will continue to have, an adverse effect on our financial condition.

In addition, continued operations and our ability to

continue as a going concern may be dependent on our ability to obtain additional financing in the near future and thereafter, and

there are no assurances that such financing will be available to us at all or will be available in sufficient amounts or on

reasonable terms.

Our financial statements do not include any adjustments that may result from the outcome of this uncertainty.

we are unable to generate additional funds in the future through sales of our products, financing or from other sources or

transactions, we will exhaust our resources and will be unable to continue operations.

If we cannot continue as a going concern, our

shareholders would likely lose most or all of their investment in us.

Management recognizes that it may

be required to obtain additional resources via issuances of indebtedness or equity to successfully execute its business plans.

No assurances

can be given that management will be successful in raising additional capital, if needed, or on acceptable terms.

These conditions raise

substantial doubt about the Company’s ability to continue as a going concern for the next 12 months.

These financial statements

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that might be necessary should the Company be unable to continue as a going concern.

Material weaknesses in our internal

control over financial reporting may cause us to fail to timely and accurately report our financial results or result in

a material misstatement of our consolidated financial statements.

A significant deficiency

and material weakness exists over our financial reporting.

We continue to implement and evaluate the

effectiveness of additional policies and procedures to address identified control deficiencies in the design and operation of

our internal control over financial reporting, as further described in Item 9A of this Annual Report

(“Controls and Procedures”).

A material weakness is a deficiency, or a combination of deficiencies,

in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of

our consolidated financial statements will not be prevented or detected on a timely basis.

Management identified a material weakness

in the Company’s internal controls related to dedicated services billing and revenue recognition, and has taken actions in

2025 to have the material weakness remediated.

To note, the significant deficiency and material weakness over our financial

reporting or the discovery of additional significant deficiencies or a material weakness and their possible effect on our results,

could have material and adverse effect on our stock price.

We have experienced recurring losses from operations

and negative cash flows from operating activities and anticipate that we will continue to incur significant operating losses

in the future.

We have experienced recurring

losses from operations and negative cash flows from operating activities.

We expect to continue to incur significant expenses related

to our ongoing operations and generate operating losses for the foreseeable future.

The size of our losses will depend, in part, on the

rate of future expenditures, our ability to execute on our acquisition strategy and our ability to generate revenues.

We incurred a net

loss of $21.0 million for the year ended December 31, 2 023 .

Our accumulated deficit increased to $133.3 million as of December 31, 2 023 , compared

to the prior year’s deficit of $112.3 million.

and negative cash flows from operating activities and anticipate that we will continue to incur significant operating losses in the future.

We have experienced recurring losses

from operations and negative cash flows from operating activities.

We expect to continue to incur significant expenses related to our

ongoing operations and generate operating losses for the foreseeable future.

The size of our losses will depend, in part, on the rate

of future expenditures, our ability to execute on our acquisition strategy and our ability to generate revenues.

We incurred a net loss

of $23.8 million

for the year ended December 31, 2 024 .

Our accumulated deficit increased to $ 155.8

million as of December 31, 2 024 , compared to the prior year’s deficit of $133.3

We may encounter unforeseen expenses,

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A decline in the value of our company could cause you to lose all or part of your investment.

If we are not able to successfully execute

on our future operating plans and objectives, our financial condition and results of operation may be materially adversely affected,

and we may not be able to continue as a going concern.

It is important that we meet

our sales goals and increase sales going forward as our operating plan already reflects prior significant cost containment measures and

may make it difficult to achieve top-line growth if further significant reductions become necessary.

If we do not meet our sales goals,

our available cash and working capital will decrease and our financial condition will be negatively impacted.

In order to be successful, we

believe that we must, among other things:

increase the sales volume and gross margins for

our products and those that we will acquire;

If we are not able to successfully execute on

our future operating plans and objectives, our financial condition and results of operation may be materially adversely affected, and

we may not be able to continue as a going concern.

It is important that we meet our

sales goals and increase sales going forward as our operating plan already reflects prior significant cost containment measures and may

make it difficult to achieve top-line growth if further significant reductions become necessary.

If we do not meet our sales goals, our

available cash and working capital will decrease and our financial condition will be negatively impacted.

In order to be successful, we believe

that we must, among other things:

increase the sales volume and gross margins for our products and those that we will acquire;

maintain efficiencies in operations;

manage our operating expenses to sufficiently

support operating activities;

manage our operating expenses to sufficiently support operating activities;

maintain fixed costs at or near current levels;

avoid significant increases in variable costs

relating to production, marketing and distribution.

We may not be able to meet these

objectives, which could have a material adverse effect on our results of operations.

We have incurred significant operating expenses

in the past and may do so again in the future and, as a result, will need to increase revenues in order to improve our results of operations.

Our ability to increase sales will depend primarily on success in expanding our current markets, improving our distribution base, entering

into Direct-To-Retail (DTR) arrangements with national accounts,

and introducing new brands, products

or product extensions to the market.

Our ability to successfully enter new distribution areas and obtain national accounts will, in turn,

depend on various factors, many of which are beyond our control, including, but not limited to, the continued demand for our brands and

products in target markets, the ability to price our products at competitive levels, available positions within the retailer’s

planograms, the ability to establish and maintain relationships with distributors in each geographic area of distribution and the ability

in the future to create, develop and successfully introduce one or more new brands, products, and product extensions.

avoid significant increases in variable costs relating to production, marketing and distribution.

We may not be able to meet

these objectives, which could have a material adverse effect on our results of operations.

We have incurred significant operating

expenses in the past and may do so again in the future and, as a result, will need to increase revenues in order to improve our

results of operations.

Our ability to increase sales will depend primarily on success in expanding our current markets, improving

our distribution base, entering into Direct-To-Retail (DTR) arrangements with national accounts, and introducing new brands,

products or product extensions to the market.

Our ability to successfully enter new distribution areas and obtain national accounts

will, in turn, depend on various factors, many of which are beyond our control, including, but not limited to, the continued demand

for our brands and products in target markets, the ability to price our products at competitive levels, available positions within

the retailer’s planograms, the ability to establish and maintain relationships with distributors in each geographic area of

distribution and the ability in the future to create, develop and successfully introduce one or more new brands, products, and

product extensions.

strategic initiatives including acquisitions and divestitures may not be successful and may divert our management’s attention away

from operations and could create general customer uncertainty.

growth strategy is based in part on growth through strategic initiatives including both acquisitions and divestitures, which poses a number

We may not be successful in identifying appropriate acquisition candidates, achieving targeted values as part of a disposition,

consummating an acquisition or divestiture on satisfactory terms, integrating any newly acquired or expanded business with our current

operations, or separating a divested business or commingled operation effectively.

We may issue additional equity, incur long-term or

short-term indebtedness, spend cash or use a combination of these for all or part of the consideration paid in future acquisitions or

expansion of our operations, which may not be available to us on terms we find advantageous or acceptable, if at all.

In addition, subject

to any requirements in the agreements governing our outstanding indebtedness, we may have significant discretion in how we employ the

consideration received in a divestiture and our management may not apply such consideration in a way that is ultimately accretive to our

The execution of our strategic

initiatives could entail repositioning or similar actions that in turn require us to record impairments, restructuring and other charges.

Any such charges would reduce our earnings.

We cannot guarantee that any future business acquisitions or divestitures will be pursued

or that any acquisitions or divestitures that are pursued will be consummated.

Additionally, any acquisition

or disposition (including the successful integration and separation of operations, products and personnel) may place a significant burden

on our management and other internal resources.

The diversion of management’s attention, and any difficulties encountered in such

a process, could harm our business, financial condition, and operating results.

Moreover, our customers may, in response to the announcement

or consummation of a transaction, delay or defer purchasing decisions.

If our customers delay or defer purchasing decisions, our revenues

could materially decline or any anticipated increases in revenue could be lower than expected.

Failure to Successfully Integrate Acquired

Businesses, Its Products and Other Assets into the Company, or If Integrated, Failure to Further the Company’s Business

Strategy, May Result in the Company’s Inability to Realize Any Benefit from Such Acquisition.

The consummation and integration of any acquired

business, product or other assets into the Company may be complex and time-consuming and, if such businesses and assets are not

successfully integrated, the Company may not achieve the anticipated benefits, cost-savings or growth opportunities.

these acquisitions and other arrangements, even if successfully integrated, may fail to further the Company’s business strategy

as anticipated, expose the Company to increased competition or other challenges with respect to the Company’s products

or geographic markets, and expose the Company to additional liabilities associated with an acquired business, technology

or other asset or arrangement.

When the Company acquires cannabis businesses, it may obtain the rights to applications for licenses

as well as licenses;

however, the procurement of such applications for licenses and licenses generally will be subject to governmental

and regulatory approval.

There are no guarantees that the Company will successfully consummate such acquisitions, and even if the Company

consummates such acquisitions, the procurement of applications for licenses may never result in the grant of a license by any state or

local governmental or regulatory agency and the transfer of any rights to licenses may never be approved by the applicable state and/or

local governmental or regulatory agency.

Demand for our products

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as our strong commitment to product quality are intended to have a favorable impact on brand image and consumer preferences.

not adequately anticipate and react to changing demographics, consumer and economic trends, health concerns and product preferences,

our financial results could be adversely affected.

not adequately anticipate and react to changing demographics, consumer and economic trends, health concerns and product preferences, our

financial results could be adversely affected.

Additionally, failure to introduce

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may not succeed.

Consumer preferences also are affected by factors other than taste, such as health and nutrition considerations and

obesity concerns, shifting consumer needs, changes in consumer lifestyles, increased consumer information and competitive product and

pricing pressures.

Consumer preferences also are affected by factors other than taste, such as health and nutrition considerations and obesity

concerns, shifting consumer needs, changes in consumer lifestyles, increased consumer information and competitive product and pricing

Sales of our products may be adversely affected by negative publicity associated with these issues.

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image and our sales may be adversely affected.

Volatility in the price or availability

of the inputs we depend on, including raw materials, packaging, energy and labor, could adversely impact our financial results.

Volatility in the price or availability of the

inputs we depend on, including raw materials, packaging, energy and labor, could adversely impact our financial results.

The principal raw materials we

use include glass bottles, aluminum cans, PET, fiber-board, labels and cardboard cartons, flavorings and sweeteners.

These component

and ingredient costs are subject to fluctuation.

These component and

ingredient costs are subject to fluctuation.

If there were to be substantial increases in the prices of our ingredients, raw materials

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ingredients or raw materials including glass, sugar, and other key supplies, we might not be able to satisfy demand on a short-term basis.

International trade disputes, including U.S.

trade tariffs and retaliatory tariffs, could adversely impact our business.

International trade disputes, including

threatened or implemented tariffs by the United States and threatened or implemented tariffs by foreign countries in retaliation, could

adversely impact our business.

Many of our tenants sell imported goods and tariffs or other trade restrictions could increase costs for

these tenants.

To the extent our tenants are unable to pass these costs on to their customers, our tenants could be adversely impacted.

In addition, international trade disputes, including those related to tariffs, could result in inflationary pressures that directly

impact our costs, such as costs for steel, lumber and other materials applicable to our redevelopment projects.

Trade disputes could also

adversely impact global supply chains which could further increase costs for us and our tenants or delay delivery of key inventories and

Significant political, trade, regulatory developments,

and other circumstances beyond our control, could have a material adverse effect on our financial condition or results of operations.

Significant political, trade, or

regulatory developments in the jurisdictions in which we sell our products, such as those stemming from the change in U.S.

federal administration,

are difficult to predict and may have a material adverse effect on us.

Similarly, changes in U.S.

federal policy that affect the geopolitical

landscape could give rise to circumstances outside our control that could have negative impacts on our business operations.

during the prior Trump administration, increased tariffs were implemented on goods imported into the U.S., particularly from China,

Canada, and Mexico.

On February 1, 2025, the U.S.

imposed a 25% tariff on imports from Canada and Mexico, which were subsequently suspended

for a period of one month, and a 10% additional tariff on imports from China.

Historically, tariffs have led to increased trade and political

tensions, between not only the U.S.

and China, but also between the U.S.

and other countries in the international community.

to tariffs, other countries have implemented retaliatory tariffs on U.S.

Political tensions as a result of trade policies could

reduce trade volume, investment, technological exchange, and other economic activities between major international economies, resulting

in a material adverse effect on global economic conditions and the stability of global financial markets.

Any changes in political, trade,

regulatory, and economic conditions, including, but not limited to, U.S.

and China trade policies, could have a material adverse effect

on our financial condition or results of operations.

Regulatory changes or actions may alter the

nature of an investment in us or restrict the use of cryptocurrencies in a manner that adversely affects our business, prospects, or operations.

As cryptocurrencies have grown in both popularity

and market size, governments around the world have reacted differently to cryptocurrencies;

certain governments have deemed them illegal,

and others have allowed their use and trade without restriction, while some jurisdictions, such as the United States, subject the mining,

ownership and exchange of cryptocurrencies to extensive, and in some cases overlapping, unclear and evolving regulatory requirements.

In January 2025, U.S.

President Donald Trump

issued an executive order forming a presidential working group to establish a clear regulatory framework for digital assets, and leaders

in both houses of the U.S.

Congress have announced a bicameral working group with the objective of passing legislation to provide regulatory

clarity for the industry.

Committees in both houses of the U.S.

Congress have held hearings to ensure fair access to financial services,

including for companies operating in the digital asset space.

Additionally, President Trump and members of the U.S.

Congress announced

that they are studying the possibility of creating a national strategic digital asset reserve to include Bitcoin, and at least twelve

states have introduced legislation to create strategic Bitcoin reserves.

While these ongoing regulatory developments appear

to be positive, and we anticipate greater regulatory certainty in the future, given the difficulty of predicting the outcomes of ongoing

and future regulatory actions and legislative developments, it is possible that future developments could have a material adverse effect

on our business, prospects, or operations.

Our business, operations, financial position and timelines, could be materially adversely affected by the continuing military action in Ukraine and

the war between Israel and Hamas.

As a result of the military action commenced in February

2022 by the Russian Federation and Belarus in Ukraine and the war between Israel and Hamas commenced in October 2023, and related economic

sanctions imposed or that may in the future be imposed by certain governments, our financial position and operations may be materially

and adversely affected.

As our ability to continue to operate will be dependent on raising debt and equity finance, any adverse impact

to those markets as a result of these conflicts, including due to increased market volatility, decreased availability in third-party financing

and/or a deterioration in the terms on which it is available (if at all), could negatively impact our business, results of operations,

cash flows, financial condition, and/or prospects.

The extent of any potential impact is not yet determinable, however.

Changes in government regulation or failure

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awareness and market acceptance of our products and brands by our target markets.

In addition, our business depends on acceptance by

our independent distributors and retailers of our brands as beverage brands that have the potential to provide incremental sales growth.

If we are not successful in the revitalization and growth of our brand and product offerings, we may not achieve and maintain satisfactory

In addition, our business depends on acceptance by our

independent distributors and retailers of our brands as beverage brands that have the potential to provide incremental sales growth.

we are not successful in the revitalization and growth of our brand and product offerings, we may not achieve and maintain satisfactory

levels of acceptance by independent distributors and retail consumers.

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to maintain brand image for our existing products and effectively build up brand image for new products and brand extensions.

predict whether our advertising, marketing and promotional programs will have the desired impact on our products’ branding and

on consumer preferences.

In addition, negative public relations and product quality issues, whether real or imagined, could tarnish our

reputation and image of the affected brands and could cause consumers to choose other products.

Our brand image can also be adversely

affected by unfavorable reports, studies and articles, litigation, or regulatory or other governmental action, whether involving our

products or those of our competitors.

predict whether our advertising, marketing and promotional programs will have the desired impact on our products’ branding and on

consumer preferences.

In addition, negative public relations and product quality issues, whether real or imagined, could tarnish our reputation

and image of the affected brands and could cause consumers to choose other products.

Our brand image can also be adversely affected by

unfavorable reports, studies and articles, litigation, or regulatory or other governmental action, whether involving our products or those

of our competitors.

Competition from traditional and large, well-financed

non-alcoholic and alcoholic beverage manufacturers may adversely affect our distribution relationships and may hinder development of

our existing markets, as well as prevent us from expanding our markets.

non-alcoholic and alcoholic beverage manufacturers may adversely affect our distribution relationships and may hinder development of our

existing markets, as well as prevent us from expanding our markets.

The beverage industry is highly

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our products, including new taxes, could reduce demand for products or increase our costs.

Taxes imposed on the sale of

certain of our products by federal, state and local governments in the United States, or other countries in which we operate could cause

consumers to shift away from purchasing our beverages.

Several municipalities in the United States have implemented or are considering

implementing taxes on the sale of certain “sugared” beverages, including non-diet soft drinks, fruit drinks, teas and flavored

waters to help fund various initiatives.

Taxes imposed on the sale of certain

of our products by federal, state and local governments in the United States, or other countries in which we operate could cause consumers

to shift away from purchasing our beverages.

Several municipalities in the United States have implemented or are considering implementing

taxes on the sale of certain “sugared” beverages, including non-diet soft drinks, fruit drinks, teas and flavored waters to

help fund various initiatives.

These taxes could materially affect our business and financial results.

Our reliance on distributors, retailers and

brokers could affect our ability to efficiently and profitably distribute and market our products, maintain our existing markets and

expand our business into other geographic markets.

brokers could affect our ability to efficiently and profitably distribute and market our products, maintain our existing markets and expand

our business into other geographic markets.

Our ability to maintain and expand

our existing markets for our products, and to establish markets in new geographic distribution areas, is dependent on our ability to

establish and maintain successful relationships with reliable distributors, retailers and brokers strategically positioned to serve those

Most of our distributors, retailers and brokers sell and distribute competing products, including non-alcoholic and alcoholic

beverages, and our products may represent a small portion of their businesses.

The success of this network will depend on the performance

of the distributors, retailers and brokers of this network.

There is a risk that the mentioned entities may not adequately perform their

functions within the network by, without limitation, failing to distribute to sufficient retailers or positioning our products in localities

that may not be receptive to our product.

our existing markets for our products, and to establish markets in new geographic distribution areas, is dependent on our ability to establish

and maintain successful relationships with reliable distributors, retailers and brokers strategically positioned to serve those areas.

Most of our distributors, retailers and brokers sell and distribute competing products, including non-alcoholic and alcoholic beverages,

and our products may represent a small portion of their businesses.

The success of this network will depend on the performance of the

distributors, retailers and brokers of this network.

There is a risk that the mentioned entities may not adequately perform their functions

within the network by, without limitation, failing to distribute to sufficient retailers or positioning our products in localities that

may not be receptive to our product.

Our ability to incentivize and motivate distributors to manage and sell our products is affected

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Some of these factors include:

the level of demand for our brands and products in a particular distribution

our ability to price our products at levels competitive with those

of competing products;

our ability to deliver products in the quantity and at the time ordered

by distributors, retailers and brokers.

the level of demand for our brands and products in a particular distribution area;

our ability to price our products at levels competitive with those of competing products;

our ability to deliver products in the quantity and at the time ordered by distributors, retailers and brokers.

We may not be able to successfully

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of our sales because our distributors are not required to place minimum orders with us.

Our independent distributors

and national accounts are not required to place minimum monthly or annual orders for our products.

In order to reduce their inventory

costs, independent distributors typically order products from us on a “just in time” basis in quantities and at such times

based on the demand for the products in a particular distribution area.

Accordingly, we cannot predict the timing or quantity of purchases

by any of our independent distributors or whether any of our distributors will continue to purchase products from us in the same frequencies

Our independent distributors and

national accounts are not required to place minimum monthly or annual orders for our products.

In order to reduce their inventory costs,

independent distributors typically order products from us on a “just in time” basis in quantities and at such times based

on the demand for the products in a particular distribution area.

Accordingly, we cannot predict the timing or quantity of purchases by

any of our independent distributors or whether any of our distributors will continue to purchase products from us in the same frequencies

and volumes as they may have done in the past.

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levels, our operating results could be adversely affected.

We need to maintain adequate

inventory levels to be able to deliver products to distributors on a timely basis.

Our inventory supply depends on our ability to correctly

estimate demand for our products.

Our ability to estimate demand for our products is imprecise, particularly for new products, seasonal

promotions and new markets.

If we materially underestimate demand for our products or are unable to maintain sufficient inventory of

raw materials, we might not be able to satisfy demand on a short-term basis.

If we overestimate distributor or retailer demand for our

products, we may end up with too much inventory, resulting in higher storage costs, increased trade spend and the risk of inventory spoilage.

If we fail to manage our inventory to meet demand, we could damage our relationships with our distributors and retailers and could delay

or lose sales opportunities, which would unfavorably impact our future sales and adversely affect our operating results.

if the inventory of our products held by our distributors and retailers is too high, they will not place orders for additional products,

which would also unfavorably impact our sales and adversely affect our operating results.

We need to maintain adequate inventory

levels to be able to deliver products to distributors on a timely basis.

Our inventory supply depends on our ability to correctly estimate

demand for our products.

Our ability to estimate demand for our products is imprecise, particularly for new products, seasonal promotions

and new markets.

If we materially underestimate demand for our products or are unable to maintain sufficient inventory of raw materials,

we might not be able to satisfy demand on a short-term basis.

If we overestimate distributor or retailer demand for our products, we may

end up with too much inventory, resulting in higher storage costs, increased trade spend and the risk of inventory spoilage.

to manage our inventory to meet demand, we could damage our relationships with our distributors and retailers and could delay or lose

sales opportunities, which would unfavorably impact our future sales and adversely affect our operating results.

In addition, if the inventory

of our products held by our distributors and retailers is too high, they will not place orders for additional products, which would also

unfavorably impact our sales and adversely affect our operating results.

If we fail to maintain relationships with our

independent contract manufacturers, our business could be harmed.

We do not manufacture SALT Tequila,

Pulpoloco Sangria or TapouT performance drinks but instead outsource the manufacturing process to third-party bottlers and independent

contract manufacturers (co-packers).

We do not own the plants or the majority of the equipment required to manufacture and package these

Our ability to maintain effective relationships with contract manufacturers and other third parties for the production and delivery

of our beverage products in a particular geographic distribution area is important to the success of our operations within each distribution

We may not be able to maintain our relationships with current contract manufacturers or establish satisfactory relationships with

new or replacement contract manufacturers, whether in existing or new geographic distribution areas.

The failure to establish and maintain

effective relationships with contract manufacturers for a distribution area could increase our manufacturing costs and thereby materially

reduce gross profits from the sale of our products in that area.

Poor relations with any of our contract manufacturers could adversely

affect the amount and timing of product delivered to our distributors for resale, which would in turn adversely affect our revenues and

financial condition.

In addition, our agreements with our contract manufacturers are terminable at any time, and any such termination

could disrupt our ability to deliver products to our customers.

We do not manufacture SALT Tequila, Pulpoloco Sangria but instead outsource

the manufacturing process to third-party bottlers and independent contract manufacturers (co-packers).

We do not own the plants or the

majority of the equipment required to manufacture and package these brands.

Our ability to maintain effective relationships with contract

manufacturers and other third parties for the production and delivery of our beverage products in a particular geographic distribution

area is important to the success of our operations within each distribution area.

We may not be able to maintain our relationships with

current contract manufacturers or establish satisfactory relationships with new or replacement contract manufacturers, whether in existing

or new geographic distribution areas.

The failure to establish and maintain effective relationships with contract manufacturers for a

distribution area could increase our manufacturing costs and thereby materially reduce gross profits from the sale of our products in

Poor relations with any of our contract manufacturers could adversely affect the amount and timing of product delivered to

our distributors for resale, which would in turn adversely affect our revenues and financial condition.

In addition, our agreements with

our contract manufacturers are terminable at any time, and any such termination could disrupt our ability to deliver products to our customers.

The volatility of energy and increased regulations

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Damage or disruption to our suppliers or to manufacturing or distribution capabilities due to weather, natural disaster, fire

or explosion, terrorism, pandemics such as influenza COVID-19, labor strikes or other reasons, could impair the manufacture, distribution

and sale of our products.

or explosion, terrorism, pandemics, 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.

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.

We rely upon our ongoing relationships with

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Although we have the exclusive rights to

flavor concentrates developed with our current flavor concentrate suppliers, and while we have the rights to the ingredients for our

products, we do not have the list of ingredients for our flavor extracts and concentrates.

Consequently, we may be unable to obtain these

exact flavors or concentrates from alternative suppliers on short notice.

If we have to replace a flavor supplier, we could experience

disruptions in our ability to deliver products to our customers, which could have a material adverse effect on our results of operations.

If we are unable to attract and retain key

personnel, our efficiency and operations would be adversely affected;

in addition, management turnover causes uncertainties and could

harm our business.

flavor concentrates developed with our current flavor concentrate suppliers, and while we have the rights to the ingredients for our products,

we do not have the list of ingredients for our flavor extracts and concentrates.

Consequently, we may be unable to obtain these exact

flavors or concentrates from alternative suppliers on short notice.

If we have to replace a flavor supplier, we could experience disruptions

in our ability to deliver products to our customers, which could have a material adverse effect on our results of operations.

If we are unable to attract and retain key personnel,

our efficiency and operations would be adversely affected;

in addition, management turnover causes uncertainties and could harm our business.

Our success depends on our ability

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We may not be able to provide our employees

with competitive salaries, and our operating results could be adversely affected by increased costs due to increased competition for

employees, higher employee turnover or increased employee benefit costs.

with competitive salaries, and our operating results could be adversely affected by increased costs due to increased competition for employees,

higher employee turnover or increased employee benefit costs.

Changes to operations, policies

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registration of our trademarks in the United States and internationally.

However, the steps taken by us to protect these proprietary

rights may not be adequate and may not prevent third parties from infringing or misappropriating our trademarks, trade secrets or similar

proprietary rights.

In addition, other parties may seek to assert infringement claims against us, and we may have to pursue litigation

against other parties to assert our rights.

However, the steps taken by us to protect these proprietary rights

may not be adequate and may not prevent third parties from infringing or misappropriating our trademarks, trade secrets or similar proprietary

In addition, other parties may seek to assert infringement claims against us, and we may have to pursue litigation against other

parties to assert our rights.

Any such claim or litigation could be costly.

In addition, any event that would jeopardize

our proprietary rights or any claims of infringement by third parties could have a material adverse effect on our ability to market or

sell our brands, profitably exploit our products or recoup our associated research and development costs.

In addition, any event that would jeopardize our proprietary

rights or any claims of infringement by third parties could have a material adverse effect on our ability to market or sell our brands,

profitably exploit our products or recoup our associated research and development costs.

As part of the licensing strategy

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Although our agreements require that the use of our trademarks and designs is subject to our control and approval, any

breach of these provisions, or any other action by any of our licensing partners that is harmful to our brands, goodwill and overall

image, could have a material adverse impact on our business.

We may be required in the future to record

a significant charge to earnings if our goodwill or intangible assets become impaired.

Under United States Generally

Accepted Accounting Principles (“U.S.

GAAP”), we are required to review our intangible assets for impairment at least annually

or when events or changes in circumstances indicate the carrying value may not be recoverable.

Factors that may be considered a change

in circumstances indicating that the carrying value of our intangible assets may not be recoverable include, declining or slower than

anticipated growth rates for certain of our existing products, a decline in stock price and market capitalization, and slower growth

rates in our industry.

We may be required in the future

to record a significant charge to earnings during the period in which we determine that our intangible assets have been impaired.

such charge would adversely impact our results of operations.

As of December 31, 2023, our intangible assets totaled approximately $4.71

breach of these provisions, or any other action by any of our licensing partners that is harmful to our brands, goodwill and overall image,

could have a material adverse impact on our business.

If we encounter product recalls or other product

quality issues, our business may suffer.

Product quality issues, real

or imagined, or allegations of product contamination, even when false or unfounded, could tarnish our image and could cause consumers

to choose other products.

In addition, because of changing government regulations or implementation thereof, or allegations of product

contamination, we may be required from time to time to recall products entirely or from specific markets.

Product recalls could affect

our profitability and could negatively affect brand image.

Product quality issues, real or

imagined, or allegations of product contamination, even when false or unfounded, could tarnish our image and could cause consumers to

choose other products.

In addition, because of changing government regulations or implementation thereof, or allegations of product contamination,

we may be required from time to time to recall products entirely or from specific markets.

Product recalls could affect our profitability

and could negatively affect brand image.

Our business is subject to many regulations and noncompliance is

The production, marketing and

sale of our beverages, including contents, labels, caps and containers, are subject to the rules and regulations of various federal,

provincial, state and local health agencies.

If a regulatory authority finds that a current or future product or production batch or

“run” is not in compliance with any of these regulations, we may be fined, or production may be stopped, which would adversely

affect our financial condition and results of operations.

Similarly, any adverse publicity associated with any noncompliance may damage

our reputation and our ability to successfully market our products.

Furthermore, the rules and regulations are subject to change from

time to time and while we closely monitor developments in this area, we cannot anticipate whether changes in these rules and regulations

will impact our business adversely.

Additional or revised regulatory requirements, whether labeling, environmental, tax or otherwise,

could have a material adverse effect on our financial condition and results of operations.

Significant additional labeling or warning

requirements may inhibit sales of affected products.

The production, marketing and sale

of our beverages, including contents, labels, caps and containers, are subject to the rules and regulations of various federal, provincial,

state and local health agencies.

If a regulatory authority finds that a current or future product or production batch or “run”

is not in compliance with any of these regulations, we may be fined, or production may be stopped, which would adversely affect our financial

condition and results of operations.

Similarly, any adverse publicity associated with any noncompliance may damage our reputation and

our ability to successfully market our products.

Furthermore, the rules and regulations are subject to change from time to time and while

we closely monitor developments in this area, we cannot anticipate whether changes in these rules and regulations will impact our business

Additional or revised regulatory requirements, whether labeling, environmental, tax or otherwise, could have a material adverse

effect on our financial condition and results of operations.

Significant additional labeling or warning requirements

may inhibit sales of affected products.

Various jurisdictions may seek

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consequences of certain of our products.

These types of requirements, if they become applicable to one or more of our products under

current or future environmental or health laws or regulations, may inhibit sales of such products.

In California, a law requires that

a specific warning appear on any product that contains a component listed by the state as having been found to cause cancer or birth

This law recognizes no generally applicable quantitative thresholds below which a warning is not required.

If a component found

in one of our products is added to the list, or if the increasing sensitivity of detection methodology that may become available under

this law and related regulations as they currently exist, or as they may be amended, results in the detection of an infinitesimal quantity

of a listed substance in one of our beverages produced for sale in California, the resulting warning requirements or adverse publicity

could affect our sales.

These types of requirements, if they become applicable to one or more of our products under current

or future environmental or health laws or regulations, may inhibit sales of such products.

In California, a law requires that a specific

warning appear on any product that contains a component listed by the state as having been found to cause cancer or birth defects.

law recognizes no generally applicable quantitative thresholds below which a warning is not required.

If a component found in one of our

products is added to the list, or if the increasing sensitivity of detection methodology that may become available under this law and

related regulations as they currently exist, or as they may be amended, results in the detection of an infinitesimal quantity of a listed

substance in one of our beverages produced for sale in California, the resulting warning requirements or adverse publicity could affect

Litigation or legal could expose us to significant

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proceedings that could result in civil or criminal penalties, including substantial monetary fines, as well as disgorgement of profits.

Additionally, there has been

public attention directed at the beverage alcohol industry, which we believe is due to concern over problems related to harmful use of

alcohol, including drinking and driving, underage drinking and health consequences from the misuse of alcohol.

We could be exposed to

lawsuits relating to product liability or marketing or sales practices with respect to our alcoholic products.

Adverse developments in

lawsuits concerning these types of matters or a significant decline in the social acceptability of beverage alcohol products that may

result from lawsuits could have a material adverse effect on our business, liquidity, financial condition and results of operations.

Additionally, there has been public

attention directed at the beverage alcohol industry, which we believe is due to concern over problems related to harmful use of alcohol,

including drinking and driving, underage drinking and health consequences from the misuse of alcohol.

We could be exposed to lawsuits

relating to product liability or marketing or sales practices with respect to our alcoholic products.

Adverse developments in lawsuits

concerning these types of matters or a significant decline in the social acceptability of beverage alcohol products that may result from

lawsuits could have a material adverse effect on our business, liquidity, financial condition and results of operations.

We are subject to risks inherent in sales of

products in international markets.

Our operations outside of the

United States, contribute to our revenue and profitability, and we believe that developing and emerging markets could present future

growth opportunities for us.

However, there can be no assurance that existing or new products that we manufacture, distribute or sell

will be accepted or be successful in any particular foreign market, due to local or global competition, product price, cultural differences,

and consumer preferences or otherwise.

There are many factors that could adversely affect demand for our products in foreign markets,

including our inability to attract and maintain key distributors in these markets;

volatility in the economic growth of certain of these

changes in economic, political or social conditions, the status and renegotiations of the North American Free Trade Agreement,

imposition of new or increased labeling, product or production requirements, or other legal restrictions;

restrictions on the import

or export of our products or ingredients or substances used in our products;

Our operations outside of the United

States, contribute to our revenue and profitability, and we believe that developing and emerging markets could present future growth opportunities

However, there can be no assurance that existing or new products that we manufacture, distribute or sell will be accepted or be

successful in any particular foreign market, due to local or global competition, product price, cultural differences, and consumer preferences

or otherwise.

There are many factors that could adversely affect demand for our products in foreign markets, including our inability to

attract and maintain key distributors in these markets;

volatility in the economic growth of certain of these markets;

changes in economic,

political or social conditions, the status and renegotiations of the North American Free Trade Agreement, imposition of new or increased

labeling, product or production requirements, or other legal restrictions;

restrictions on the import or export of our products or ingredients

or substances used in our products;

inflationary currency, devaluation or fluctuation;

costs of doing business due to compliance with complex foreign and U.S.

increased costs of doing business due to compliance

with complex foreign and U.S.

laws and regulations.

If we are unable to effectively

operate or manage the risks associated with operating in international markets, our business, financial condition or results of operations

could be adversely affected.

Water scarcity and poor quality could negatively impact our

costs and capacity.

Water is a main ingredient in

substantially all of our products, is vital to the production of the agricultural ingredients on which our business relies and is needed

in our manufacturing process.

If we are unable to effectively operate or manage the risks associated with operating

in international markets, our business, financial condition or results of operations could be adversely affected.

Water scarcity and poor quality could negatively impact our costs

and capacity.

Water is a main ingredient in substantially

all of our products, is vital to the production of the agricultural ingredients on which our business relies and is needed in our manufacturing

It also is critical to the prosperity of the communities we serve.

Water is a limited resource in many

parts of the world, facing unprecedented challenges from overexploitation, increasing demand for food and other consumer and industrial

products whose manufacturing processes require water, increasing pollution and emerging awareness of potential contaminants, poor management,

lack of physical or financial access to water, sociopolitical tensions due to lack of public infrastructure in certain areas of the world

and the effects of climate change.

As the demand for water continues to increase around the world, and as water becomes scarcer and the

quality of available water deteriorates, we may incur higher costs or face capacity constraints and the possibility of reputational damage,

which could adversely affect our profitability or net operating revenues in the long run.

Water is a limited resource in many parts of the world, facing

unprecedented challenges from overexploitation, increasing demand for food and other consumer and industrial products whose manufacturing

processes require water, increasing pollution and emerging awareness of potential contaminants, poor management, lack of physical or financial

access to water, sociopolitical tensions due to lack of public infrastructure in certain areas of the world and the effects of climate

As the demand for water continues to increase around the world, and as water becomes scarcer and the quality of available water

deteriorates, we may incur higher costs or face capacity constraints and the possibility of reputational damage, which could adversely

affect our profitability or net operating revenues in the long run.

Fluctuations in quantity and quality of grape

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impacted in the event of a failure or interruption of our information technology infrastructure or as a result of a cybersecurity attack.

The proper functioning of our

own information technology (IT) infrastructure is critical to the efficient operation and management of our business.

have the necessary financial resources to update and maintain our IT infrastructure, and any failure or interruption of our IT system could

adversely impact our operations.

In addition, our IT is vulnerable to cyberattacks, computer viruses, worms and other malicious software

programs, physical and electronic break-ins, sabotage and similar disruptions from unauthorized tampering with our computer systems.

We believe that we have adopted appropriate measures to mitigate potential risks to our technology infrastructure and our operations

from these IT-related and other potential disruptions.

However, given the unpredictability of the timing, nature and scope of any

such IT failures or disruptions, we could potentially be subject to downtimes, transactional errors, processing inefficiencies,

operational delays, other detrimental impacts on our operations or ability to provide products to our customers, the compromising of

confidential or personal information, destruction or corruption of data, security breaches, other manipulation or improper use of our

systems and networks, financial losses from remedial actions, loss of business or potential liability, and/or damage to our reputation,

any of which could have a material adverse effect on our cash flows, competitive position, financial condition or results of operations.

The proper functioning of our own

information technology (IT) infrastructure is critical to the efficient operation and management of our business.

We may not have the

necessary financial resources to update and maintain our IT infrastructure, and any failure or interruption of our IT system could adversely

impact our operations.

In addition, our IT is vulnerable to cyberattacks, computer viruses, worms and other malicious software programs,

physical and electronic break-ins, sabotage and similar disruptions from unauthorized tampering with our computer systems.

that we have adopted appropriate measures to mitigate potential risks to our technology infrastructure and our operations from these IT-related

and other potential disruptions.

However, given the unpredictability of the timing, nature and scope of any such IT failures or disruptions,

we could potentially be subject to downtimes, transactional errors, processing inefficiencies, operational delays, other detrimental impacts

on our operations or ability to provide products to our customers, the compromising of confidential or personal information, destruction

or corruption of data, security breaches, other manipulation or improper use of our systems and networks, financial losses from remedial

actions, loss of business or potential liability, and/or damage to our reputation, any of which could have a material adverse effect on

our cash flows, competitive position, financial condition or results of operations.

If we fail to comply with personal data protection and privacy laws,

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business and operating results.

In the ordinary course of our

business, we receive, process, transmit and store information relating to identifiable individuals (“personal data”), primarily

employees, former employees and consumers with whom we interact.

In the ordinary course of our business,

we receive, process, transmit and store information relating to identifiable individuals (“personal data”), primarily employees,

former employees and consumers with whom we interact.

As a result, we are subject to various U.S.

federal and state and foreign

laws and regulations relating to personal data.

These laws have been subject to frequent changes, and new legislation in this area may

be enacted in other jurisdictions at any time.

These laws impose operational requirements for companies receiving or processing personal

data, and many provide for significant penalties for noncompliance.

These requirements with respect to personal data have subjected and

may continue in the future to subject the Company to, among other things, additional costs and expenses and have required and may in

the future require costly changes to our business practices and information security systems, policies, procedures and practices.

security controls over personal data, the training of employees and vendors on data privacy and data security, and the policies, procedures

and practices we implemented or may implement in the future may not prevent the improper disclosure of personal data by us or the third-party

service providers and vendors whose technology, systems and services we use in connection with the receipt, storage and transmission

of personal data.

Unauthorized access or improper disclosure of personal data in violation of personal data protection or privacy laws

could harm our reputation, cause loss of consumer confidence, subject us to regulatory enforcement actions (including fines), and result

in private litigation against us, which could result in loss of revenue, increased costs, liability for monetary damages, fines and/or

criminal prosecution, all of which could negatively affect our business and operating results.

federal and state and foreign laws and

regulations relating to personal data.

These laws have been subject to frequent changes, and new legislation in this area may be enacted

in other jurisdictions at any time.

These laws impose operational requirements for companies receiving or processing personal data, and

many provide for significant penalties for noncompliance.

These requirements with respect to personal data have subjected and may continue

in the future to subject the Company to, among other things, additional costs and expenses and have required and may in the future require

costly changes to our business practices and information security systems, policies, procedures and practices.

Our security controls over

personal data, the training of employees and vendors on data privacy and data security, and the policies, procedures and practices we

implemented or may implement in the future may not prevent the improper disclosure of personal data by us or the third-party service providers

and vendors whose technology, systems and services we use in connection with the receipt, storage and transmission of personal data.

access or improper disclosure of personal data in violation of personal data protection or privacy laws could harm our reputation, cause

loss of consumer confidence, subject us to regulatory enforcement actions (including fines), and result in private litigation against

us, which could result in loss of revenue, increased costs, liability for monetary damages, fines and/or criminal prosecution, all of

which could negatively affect our business and operating results.

If our third-party service providers and business

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These third-party service providers and business partners are subject to similar risks as we are relating

to cybersecurity, privacy violations, business interruption, and systems and employee failures, and are subject to legal, regulatory

and market risks of their own.

Our third-party service providers and business partners may not fulfill their respective commitments and

responsibilities in a timely manner and in accordance with the agreed-upon terms.

In addition, while we have procedures in place for

selecting and managing our relationships with third-party service providers and other business partners, we do not have control over

their business operations or governance and compliance systems, practices and procedures, which increases our financial, legal, reputational

and operational risk.

If we are unable to effectively manage our third-party relationships, or for any reason our third-party service

providers or business partners fail to satisfactorily fulfill their commitments and responsibilities, our financial results could suffer.

to cybersecurity, privacy violations, business interruption, and systems and employee failures, and are subject to legal, regulatory and

market risks of their own.

Our third-party service providers and business partners may not fulfill their respective commitments and responsibilities

in a timely manner and in accordance with the agreed-upon terms.

In addition, while we have procedures in place for selecting and managing

our relationships with third-party service providers and other business partners, we do not have control over their business operations

or governance and compliance systems, practices and procedures, which increases our financial, legal, reputational and operational risk.

If we are unable to effectively manage our third-party relationships, or for any reason our third-party service providers or business

partners fail to satisfactorily fulfill their commitments and responsibilities, our financial results could suffer.

Our results of operations may fluctuate from

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that the controls will prevent or detect misstatements.

Because of these and other inherent limitations of control systems, there is

only the reasonable assurance that our controls will succeed in achieving their goals under all potential future conditions.

of controls by design deficiencies or absence of adequate controls could result in a material adverse effect on our business and financial

Because of these and other inherent limitations of control systems, there is only

the reasonable assurance that our controls will succeed in achieving their goals under all potential future conditions.

The failure of

controls by design deficiencies or absence of adequate controls could result in a material adverse effect on our business and financial

results, which could also negatively impact our stock price and investor confidence.

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in Mexico distiller or an adverse change in the terms of its services could have a negative impact on our business.

If our distiller

in Mexico increases its prices, we may not have alternative sources of supply at comparable prices and may not be able to raise the prices

If our distiller in

Mexico increases its prices, we may not have alternative sources of supply at comparable prices and may not be able to raise the prices

of our products to cover all, or even a portion, of the increased costs.

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could cause us to fail to meet orders, lose sales, incur additional costs, and/or expose us to product quality issues.

In turn, this

could cause us to lose credibility in the marketplace and damage our relationships with our customers and consumers, ultimately leading

to a decline in our business and results of operations.

In turn, this could

cause us to lose credibility in the marketplace and damage our relationships with our customers and consumers, ultimately leading to a

decline in our business and results of operations.

Regulatory decisions and changes in the legal,

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these laws and regulations are subject to interpretation, we may not be able to predict when, and to what extent, liability may arise.

Additionally, due to increasing public concern over alcohol-related societal problems, including driving while intoxicated, underage

drinking, alcoholism and health consequences from the abuse of alcohol, various levels of government may seek to impose additional restrictions

Additionally, due to increasing public concern over alcohol-related societal problems,

including driving while intoxicated, underage drinking,

alcoholism and health consequences from the abuse of alcohol, various levels of government may seek to impose additional restrictions

or limits on advertising or other marketing activities promoting beverage alcohol products.

Failure to comply with any of the current

or future regulations and requirements relating to our industry and products, could result in monetary penalties, suspension or even

revocation of our licenses and permits.

Costs of compliance with changes in regulations could be significant and could harm our business,

as we may find it necessary to raise our prices in order to maintain profit margins, which could lower the demand for our products and

reduce our sales and profit potential.

In addition, the distribution

of beverage alcohol products is subject to extensive taxation both in the United States and internationally (and, in the United States,

at both the federal and state government levels), and beverage alcohol products themselves are the subject of national import and excise

or future regulations and requirements relating to our industry and products, could result in monetary penalties, suspension or even revocation

of our licenses and permits.

Costs of compliance with changes in regulations could be significant and could harm our business, as we may

find it necessary to raise our prices in order to maintain profit margins, which could lower the demand for our products and reduce our

sales and profit potential.

In addition, the distribution of

beverage alcohol products is subject to extensive taxation both in the United States and internationally (and, in the United States, at

both the federal and state government levels), and beverage alcohol products themselves are the subject of national import and excise

duties in most countries around the world.

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distributors, wholesalers, or retailers could create a more challenging competitive landscape for our products.

Consolidation at any

level could hinder the distribution and sale of our products as a result of reduced attention and resources allocated to our brands,

both during and after transition periods, because our brands might represent a smaller portion of the new business portfolio.

into new product categories by other suppliers, or innovation by new entrants into the market, could increase competition in our product

Changes to our route-to-consumer models or partners in important markets could result in temporary or longer-term sales disruption,

higher implementation-related or fixed costs, and could negatively affect other business relationships we might have with that partner.

Distribution network disruption or fluctuations in our product inventory levels with distributors, wholesalers, or retailers could negatively

affect our results for a particular period.

Consolidation at any level

could hinder the distribution and sale of our products as a result of reduced attention and resources allocated to our brands, both during

and after transition periods, because our brands might represent a smaller portion of the new business portfolio.

Expansion into new product

categories by other suppliers, or innovation by new entrants into the market, could increase competition in our product categories.

to our route-to-consumer models or partners in important markets could result in temporary or longer-term sales disruption, higher implementation-related

or fixed costs, and could negatively affect other business relationships we might have with that partner.

Distribution network disruption

or fluctuations in our product inventory levels with distributors, wholesalers, or retailers could negatively affect our results for a

particular period.

Our competitors may respond to

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These risks include:

Unfavorable economic conditions and related low consumer confidence,

high unemployment, weak credit or capital markets, sovereign debt defaults, sequestrations, austerity measures, higher interest rates,

political instability, higher inflation, deflation, lower returns on pension assets, or lower discount rates for pension obligations;

Changes in laws, regulations, or policies – especially those

that affect the production, importation, marketing, sale, or consumption of our beverage alcohol products;

Tax rate changes (including excise, sales, tariffs, duties, corporate,

individual income, dividends, capital gains), or changes in related reserves, changes in tax rules or accounting standards, and the

unpredictability and suddenness with which they can occur;

Unfavorable economic conditions and related low consumer confidence, high unemployment, weak credit or capital markets, sovereign debt defaults, sequestrations, austerity measures, higher interest rates, political instability, higher inflation, deflation, lower returns on pension assets, or lower discount rates for pension obligations;

Changes in laws, regulations, or policies - especially those that affect the production, importation, marketing, sale, or consumption of our beverage alcohol products;

● Tax rate changes (including excise, sales, tariffs, duties, corporate, individual income, dividends, capital gains), or changes in

related reserves, changes in tax rules or accounting standards, and the unpredictability and suddenness with which they can occur;

● Dependence upon the continued growth of brand names;

Changes in consumer preferences, consumption, or purchase patterns

– particularly away from tequila, and our ability to anticipate and react to them;

bar, restaurant, travel, or other on-premise

Unfavorable consumer reaction to our products, package changes, product

reformulations, or other product innovation;

Decline in the social acceptability of beverage alcohol products in

● Changes in consumer preferences, consumption, or purchase patterns - particularly away from tequila, and our ability to anticipate

and react to them;

bar, restaurant, travel, or other on-premise declines;

● Unfavorable consumer reaction to our products, package changes, product reformulations, or other product innovation;

● Decline in the social acceptability of beverage alcohol products in our markets;

● Production facility or supply chain disruption;

● Imprecision in supply/demand forecasting;

Higher costs, lower quality, or unavailability of energy, input materials,

labor, or finished goods;

Route-to-consumer changes that affect the timing of our sales, temporarily

disrupt the marketing or sale of our products, or result in higher implementation related or fixed costs;

Inventory fluctuations in our products by distributors, wholesalers,

or retailers;

Competitors’ consolidation or other competitive activities, such as pricing actions (including price reductions,

promotions, discounting, couponing, or free goods), marketing, category expansion, product introductions, or entry or expansion in

our geographic markets;

● Higher costs, lower quality, or unavailability of energy, input materials, labor, or finished goods;

● Route-to-consumer changes that affect the timing of our sales, temporarily disrupt the marketing or sale of our products, or result

in higher implementation related or fixed costs;

● Inventory fluctuations in our products by distributors, wholesalers, or retailers;

Competitors’ consolidation or other competitive

activities, such as pricing actions (including price reductions, promotions, discounting, couponing, or free goods), marketing, category

expansion, product introductions, or entry or expansion in our geographic markets;

● Insufficient protection of our intellectual property rights;

● Product recalls or other product liability claims;

product counterfeiting,

tampering, or product quality issues;

product counterfeiting, tampering, or product quality issues;

● Significant legal disputes and proceedings;

government investigations

(particularly of industry or company business, trade or marketing practices);

government investigations (particularly of industry or company business, trade or marketing

● Failure or breach of key information technology systems;

Negative publicity related to our company, brands, marketing, personnel,

operations, business performance or prospects;

Business disruption, decline, or costs related to organizational changes,

reductions in workforce, or other cost-cutting measures, or our failure to attract or retain key executive or employee talent.

● Negative publicity related to our company, brands, marketing, personnel, operations, business performance or prospects;

● Business disruption, decline, or costs related to organizational changes, reductions in workforce, or other cost-cutting measures,

or our failure to attract or retain key executive or employee talent.

Uncertainty in the financial markets and other

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future at a time and at a price that we deem appropriate.

From time to time, certain of

our stockholders may be eligible to sell all or some of their common shares by means of ordinary brokerage transactions in the open market

pursuant to Rule 144 promulgated under the Securities Act of 1933, as amended (the “Securities Act”), subject to certain

In general, pursuant to Rule 144, non-affiliate stockholders may sell freely after six months subject only to the current

public information requirement.

Affiliates may sell after six months subject to the Rule 144 volume, manner of sale (for equity securities),

and current public information and notice requirements.

Our Board of Directors may issue and fix the terms of shares

of our Preferred Stock without stockholder approval, which could adversely affect the voting power of holders of our Common Stock or

any change in control of our Company.

Our Articles of Incorporation

authorize the issuance of up to 5,000,000 shares of “blank check” preferred stock, with par value $0.001 per share, with

such designation rights and preferences as may be determined from time to time by the Board of Directors.

Our Board of Directors is empowered,

without shareholder approval, to issue shares of preferred stock with dividend, liquidation, conversion, voting or other rights which

could adversely affect the voting power or other rights of the holders of our common stock.

In the event of such issuances, the preferred

stock could be used, under certain circumstances, as a method of discouraging, delaying or preventing a change in control of our company.

Any such issuance would be subject to terms and conditions of any current offering that may disallow any such issuance.

Because certain principal stockholders own

a large percentage of our voting stock, other stockholders’ voting power may be limited.

As of December 31, 2023, our

ten (10) largest shareholders own or controlled approximately 21.2% of our outstanding common stock.

From time to time, certain of our

stockholders may be eligible to sell all or some of their common shares by means of ordinary brokerage transactions in the open market

pursuant to Rule 144 promulgated under the Securities Act of 1933, as amended (the “Securities Act”), subject to certain limitations.

In general, pursuant to Rule 144, non-affiliate stockholders may sell freely after six months subject only to the current public information

Affiliates may sell after six months subject to the Rule 144 volume, manner of sale (for equity securities), and current

public information and notice requirements.

Our Board of Directors may issue and fix the terms of shares of our

Preferred Stock without stockholder approval, which could adversely affect the voting power of holders of our Common Stock or any change

in control of our Company.

Our Articles of Incorporation authorize

the issuance of up to 5,000,000 shares of “blank check” preferred stock, with par value $0.001 per share, with such designation

rights and preferences as may be determined from time to time by the Board of Directors.

Our Board of Directors is empowered, without

shareholder approval, to issue shares of preferred stock with dividend, liquidation, conversion, voting or other rights which could adversely

affect the voting power or other rights of the holders of our common stock.

In the event of such issuances, the preferred stock could

be used, under certain circumstances, as a method of discouraging, delaying or preventing a change in control of our company.

issuance would be subject to terms and conditions of any current offering that may disallow any such issuance.

We have 1,000 shares of Series A Preferred Stock

authorized and outstanding with mirrored voting rights.

Series A Preferred Stock

Pursuant to a certificate of designation filed with

the Secretary of State of the State of Nevada on June 10, 2025 (the “Certificate of Designation of Series A Preferred Stock”),

one thousand (1,000) shares of preferred stock have been designated as Series A Preferred Stock, par value $0.001 per share, of the Company

(“Series A Preferred Stock”).

The Certificate of Designation provides that each Series A Preferred Share will have twenty-five

thousand (25,000) votes and will vote together with the Company’s outstanding common shares, par value $0.001 (the “Common

Shares”), as a single class, only with respect to the proposal related to the increase of authorized shares at the Special Meeting.

The holder of the Series A Preferred Shares has granted an irrevocable proxy to certain officers of the Company to vote the Series A Preferred

Shares in accordance with the terms of the Issuance Documents, in connection with the Special Meeting.

Per the terms of the Issuance Documents,

if voted, the Series A Preferred Shares are required to vote on the applicable proposals in the same “mirrored” proportion

aggregate votes cast “FOR” and “AGAINST” on the proposal to increase the authorized shares by the holders of the

Common Shares who properly vote on such proposal (but excluding any abstentions).

Nistico, the Company’s Chief Executive Officer,

directly beneficially owns such one thousand (1,000) share of Series A Preferred Stock.

The outstanding Series A Preferred Shares are required

to be redeemed in whole, but not in part, upon the earliest of:

(i) if such redemption is authorized and directed by the Board in its

sole discretion, automatically and effective on such time and date specified by the Board in its sole discretion, (ii) automatically upon

the approval by the Company’s shareholders of the increase of the authorized shares at any meeting of shareholders or (iii) immediately

prior to the record date for the 2025 Annual Meeting of Shareholders of the Company Upon such redemption, the holder of the Series A Preferred

Shares will receive aggregate consideration equal to the Purchase Price.

The Series A Preferred will vote as described above

to increase the number of authorized shares of our common stock, which could result in substantial dilution to existing stockholders if

additional shares are issued.

The increase in authorized shares provides us with greater flexibility to issue additional equity securities

for various corporate purposes, including financings, equity compensation, or other strategic transactions.

However, any such issuances

may dilute the ownership interests of existing stockholders and could adversely affect the market price of our common stock.

the issuance of additional shares may make it more difficult for a third party to acquire control of the Company, which could discourage

or delay takeover attempts that could benefit stockholders.

There can be no assurance as to when or if any additional shares will be issued

or the terms on which such issuances may occur.

We have issued multiple classes of preferred

stock in the Company that will result in dilution to existing stockholders upon their conversion

The issuance of common stock upon conversion of the

our Series A-1 Preferred Stock, our Series B Redeemable Preferred Stock, and our Series C Convertible Preferred Stock will result in immediate

and substantial dilution to the interests of other stockholders.

Although holders may not receive shares of common stock exceeding 4.99%

of our outstanding shares of common stock immediately after affecting such conversion, this restriction does not prevent holders from

receiving shares up to the 4.99% limit, selling those shares, and then receiving the rest of the shares it is due, in one or more tranches,

while still staying below the 4.99% limit.

If holders choose to do this, it will cause substantial dilution to the then holders of our

common stock.

Additionally, the continued sale of shares issuable upon successive conversions will likely create significant downward

pressure on the price of our common stock as holders sells material amounts of our common stock over time and/or in a short period of

This could place further downward pressure on the price of our common stock and in turn result in holders receiving an ever-increasing

number of additional shares of common stock upon conversion of its securities, and adjustments thereof, which in turn will likely lead

to further dilution, reductions in the exercise/conversion price of holders securities and even more downward pressure on our common stock,

which could lead to our common stock becoming devalued or worthless

The market price of our common stock

has been volatile over the year and may continue to be volatile.

The market price and

trading volume of our common stock has been volatile over the past year, and it may continue to be volatile.

Over fiscal year 2024 and the date of this annual report, our common stock has traded as low as $0.96 and as high as $29.20

We cannot predict the price at which our common stock will trade in the future, and the price of

our common stock may decline.

The price at which our common stock trades may fluctuate significantly and

may be influenced by many factors, including our financial results, developments generally affecting the coffee industry, general economic,

industry and market conditions, the depth and liquidity of the market for our common stock, fluctuations in coffee prices,

investor perceptions of our business, reports by industry analysts, negative announcements by our customers, competitors or suppliers

regarding their own performances, and the impact of other “Risk Factors” discussed in the Annual Report.

Because certain principal stockholders own a

large percentage of our voting stock, other stockholders’ voting power may be limited.

As of December 31, 2024, our ten

(10) largest shareholders own or controlled approximately 57% of our outstanding common stock .

If those stockholders act together,

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should not buy our Common Stock expecting to receive dividends.

We do not anticipate that we

will declare or pay any dividends in the foreseeable future.

Consequently, you will only realize an economic gain on your investment

in our common stock if the price appreciates.

We do not anticipate that we will

declare or pay any dividends in the foreseeable future.

Consequently, you will only realize an economic gain on your investment in our

common stock if the price appreciates.

You should not purchase our common stock expecting to receive cash dividends.

our failure to pay dividends may cause you to not see any return on your investment even if we are successful in our business operations.

There can be no assurances that our common

stock will not be subject to potential delisting if we do not continue to maintain the listing requirements of the NYSE American.

Therefore, our failure

to pay dividends may cause you to not see any return on your investment even if we are successful in our business operations.

There can be no assurances that our common stock

will not be subject to potential delisting if we do not continue to maintain the listing requirements of the NYSE American.

Since June 11, 2021, our common

stock has been listed on the NYSE American, under the symbol “SBEV”.

The NYSE American has rules for continued listing,

including, without limitation, minimum market capitalization and other requirements.

Failure to maintain our listing (i.e., being de-listed

from the NYSE American), would make it more difficult for shareholders to sell our common stock and more difficult to obtain accurate

price quotations on our common stock.

The NYSE American has rules for continued listing, including,

without limitation, minimum market capitalization and other requirements.

Failure to maintain our listing (i.e., being de-listed from

the NYSE American), would make it more difficult for shareholders to sell our common stock and more difficult to obtain accurate price

quotations on our common stock.

This could have an adverse effect on the price of our common stock.

Our ability to issue additional

securities for financing or other purposes, or otherwise to arrange for any financing we may need in the future, may also be materially

and adversely affected if our common stock is not traded on a national securities exchange.

On October 6, 2023, the NYSE

American notified the Company that we were not in compliance with Section 1003(a)(i) of the continued listing standards set forth in

the NYSE American Company Guide (the “Company Guide”), requiring a listed company to have stockholders’ equity of (i)

at least $2.0 million if it has reported losses from continuing operations or net losses in two of its three most recent fiscal years.

The notice had no immediate impact on the listing of our common stock, subject to our compliance with the other continued listing requirements.

In accordance with applicable NYSE American procedures, we submitted a plan of compliance (the “Plan”) advising of the definitive

action(s) the Company has taken, is taking, or would take, that would bring us into compliance with the continued listing standards within

the 18 months of receipt of the notice.

The NYSE American reviewed and accepted the Plan as a reasonable demonstration of an ability

to conform to the relevant standards in the 18-month period.

On December 20, 2023, we received a notification (the “Plan Letter”),

with NYSE American acceptance of the proposed plan and further deficiency notice.

In the Plan Letter the NYSE American indicated that

in addition to Section 1003(a)(i), the Company was also not in compliance with Section 1003(a)(ii) of the Company Guide, requiring a

listed company to have stockholders’ equity of at least $4.0 million if it has reported losses from continuing operations or net

losses in three of its four most recent fiscal years.

Our ability to issue additional securities

for financing or other purposes, or otherwise to arrange for any financing we may need in the future, may also be materially and adversely

affected if our common stock is not traded on a national securities exchange.

On October 6, 2023, the NYSE American

notified the Company that we were not in compliance with Section 1003(a)(i) of the continued listing standards set forth in the NYSE American

Company Guide (the “Company Guide”), requiring a listed company to have stockholders’ equity of (i) at least $2.0 million

if it has reported losses from continuing operations or net losses in two of its three most recent fiscal years.

The notice had no immediate

impact on the listing of our common stock, subject to our compliance with the other continued listing requirements.

In accordance with

applicable NYSE American procedures, we submitted a plan of compliance (the “Plan”) advising of the definitive action(s) the

Company has taken, is taking, or would take, that would bring us into compliance with the continued listing standards within the 18 months

of receipt of the notice.

The NYSE American reviewed and accepted the Plan as a reasonable demonstration of an ability to conform to the

relevant standards in the 18-month period.

On December 20, 2023, we received a notification (the “Plan Letter”), with NYSE

American acceptance of the proposed plan and further deficiency notice.

In the Plan Letter the NYSE American indicated that in addition

to Section 1003(a)(i), the Company was also not in compliance with Section 1003(a)(ii) of the Company Guide, requiring a listed company

to have stockholders’ equity of at least $4.0 million if it has reported losses from continuing operations or net losses in three

of its four most recent fiscal years.

On June 5, 2024, the Company received

notification from the NYSE American indicating that it is not in compliance with the Exchange’s continued listing standards

under Section 1003(a)(iii) of the Company Guide, requiring a listed company to have stockholders’ equity of $6 million

or more if the listed company has reported losses from continuing operations and/or net losses in its five most recent fiscal years.

On April 7, 2025, Company, NYSE

American publicly announced and provided a notice to the Company that NYSE Regulation has determined to commence proceedings to delist

the Company’s Common Stock and publicly trading Warrants to purchase one share of Common Stock, from NYSE American.

NYSE Regulation

has determined that the Company is no longer suitable for listing pursuant to Section 1009(a) of the NYSE American Company Guide as the

Company was unable to demonstrate that it had regained compliance with Sections 1003(a)(i), (ii), and (iii) of the Company Guide by the

end of the maximum 18-month compliance plan period, which expired on April 6, 2025.

April 16, 2025, the Company, received an official notice of noncompliance from NYSE Regulation stating that the Company is

not in compliance with NYSE American continued listing standards due to the failure to timely file the Company’s Form 10-K for the

year ended December 31, 2024 by the filing due date of April 15, 2025.

Our common stock will continue

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the NYSE American rules and listing standards, or are unable to make progress on our Plan, our securities could be subject to delisting.

If the NYSE American were to

delist our securities from trading, we could face significant consequences, including, but not limited to, the follo wing:

limited availability for market quotations for our securities;

liquidity with respect to our securities;

determination that our common stock is a “penny stock,” which will require brokers

trading in our common stock to adhere to more stringent rules and possibly result in a reduced

level of trading activity in the secondary trading market for our common stock;

amount of news and analyst coverage;

decreased ability to issue additional securities or obtain additional financing in the future.

If the NYSE American were to delist

our securities from trading, we could face significant consequences, including, but not limited to, the following:

● a limited availability

for market quotations for our securities;

● reduced liquidity with

respect to our securities;

● a determination that

our common stock is a “penny stock,” which will require brokers trading in our common stock to adhere to more stringent rules

and possibly result in a reduced level of trading activity in the secondary trading market for our common stock;

● limited amount of news

and analyst coverage;

● a decreased ability

to issue additional securities or obtain additional financing in the future.

Our common stock could be further diluted as

6 unchanged sentences

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