What changed in this filing

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Item 1. Financial Statements

2025-07-11 compared with 2024-11-15 · 458 added, 394 removed, 476 unchanged (64% of the section changed)

2 unchanged sentences

Condensed Consolidated Financial Statements

September 30, 2024

March 31, 2025

Splash Beverage Group, Inc.

Condensed Consolidated Balance Sheets

September 30, 2024 and December 31, 2023

September 30,

December 31, 2023

March 31, 2025 and December 31, 2024

and cash equivalents

receivable, net

current assets

Cash and cash equivalents

Accounts receivable, net

Prepaid expenses

Other receivables

Total current assets

in Salt Tequila USA, LLC

of use assets

and equipment, net

non-current assets

Intangible assets, net

Investment in Salt Tequila USA, LLC

Right of use assets

Property and equipment, net

Total non-current assets

Liabilities and Stockholders’ Equity

and Stockholders’ Equity

payable and accrued expenses

of use liability, current portion

party notes payable

payable, net of discounts

interest payable

current liabilities

Accounts payable and accrued expenses

Right of use liability, current portion

Related party notes payable

Notes payable, net of discounts

Shareholder advances

Accrued interest payable

Total current liabilities

payable, net of discounts

of use liability – net of current portion

long-term liabilities

Notes payable, net of discounts

Right of use liability – net of current portion

Total long-term liabilities

Total liabilities

Stockholders’ equity:

Preferred stock, $ 0.001 par value, 5,000,000 shares authorized, no shares issued

Common Stock, $ 0.001 par, 300,000,000 shares authorized, 61,230,548 shares issued, 44,330,099 shares outstanding at September 30, 2024 and December 31, 2023

Additional paid in capital

Accumulated other comprehensive loss

Accumulated deficit

( 146,792,889 )

( 133,334,783 )

Total stockholders’ equity

Stockholders’

stock, $ 0.001 par value, 5,000,000 shares authorized, no shares issued

Stock, $ 0.001 par, 7,500,000 shares authorized, 1,899,876 shares issued, 1,669,835 shares outstanding at March 31, 2025 and December

paid in capital

other comprehensive loss

( 159,482,727

( 155,832,277

Total liabilities and stockholders’ equity

stockholders’ equity

liabilities and stockholders’ equity

Shares and per share amounts are reflective of the

1 for 40 reverse split that occurred on March 27, 2025.

The accompanying notes are an integral part of these

2 unchanged sentences

Condensed Consolidated Statements of Operations and Comprehensive Loss

For the Three Months and Nine Months Ended September 30, 2024 and 2023

Three months ended September 30

Nine months ended September 30,

Cost of goods sold

For the Three Months Ended March 31, 2025 and 2024

Three months ended

of goods sold

share-based compensation

general and administrative

and marketing

operating expenses

Contracted services

Salary and wages

Non-cash share-based compensation

Other general and administrative

Sales and marketing

Total operating expenses

Loss from operations

Other income/(expense):

Interest income

Interest expense

Other Income/Expense

Legal reserve

Amortization of debt discount

Total other income/(expense)

Provision for income taxes

Other Comprehensive Income (Loss)

Foreign currency translation loss

Total Comprehensive Income (Loss)

(Loss) per share - continuing operations

Basic and diluted

Weighted average number of common shares outstanding - continuing operations

Basic and diluted

from continuing operations

income/(expense):

of debt discount

other expense

for income taxes

loss from continuing operations, net of tax

comprehensive loss foreign currency translation loss, net of tax

comprehensive loss

per share - continuing operations

average number of common shares outstanding - continuing operations

Shares and per share amounts are reflective of the

1 for 40 reverse split that occurred on March 27, 2025.

The accompanying notes are an integral part of these

3 unchanged sentences

in Stockholders’ Equity

For the Nine months ended September 30, 2024 and

Common Shares

Additional paid-in capital

Accumulated other comprehensive loss

Accumulated deficit

For the Three months ended March 31, 2025 and 2024

paid-in capital

other comprehensive loss

stockholders’ equity

Balances at December 31, 2022

( 112,331,026

Common stock issuable and beneficial conversion feature on convertible 12-month promissory note

Share based compensation

Accumulated Comprehensive loss – translation, net

Balances at March 31, 2023

( 116,060,325

Issuance of common stock on convertible instruments

Share based compensation

Issuance of common stock for services

Issuance of warrants on convertible instruments

Accumulated Comprehensive loss – translation, net

Balances at June 30, 2023

( 121,670,574

Debt discount from convertible instrument

Share based compensation

Issuance of common stock for services

Issuance of warrants on convertible instruments

Accumulated Comprehensive loss – translation, net

Balances at September 30, 2023

( 127,340,655

Balances at December 31, 2023

at December 31, 2023

( 133,334,783

Issuance of common stock for note extension

Share based compensation

Adoption of ASU 2020-06

Issuance of warrants on convertible instruments

Conversion of notes payable to common stock

Issuance of common stock for services

Accumulated Comprehensive loss – translation, net

Balances at March 31, 2024

of common stock for note extension

based compensation

of ASU 2020-06

of warrants on convertible instruments

of notes payable to common stock

of common stock for services

Comprehensive loss – translation, net

at March 31, 2024

( 136,746,623

Issuance of common stock for convertible note

Share based compensation

Issuance of warrants on convertible instruments

Conversion of notes payable to common stock

Issuance of common stock for services

Accumulated Comprehensive loss – translation, net

Balances at June 30, 2024

at December 31, 2024

( 155,832,277

Share based compensation

Issuance of common stock for convertible note

Issuance of warrants on convertible instruments

Conversion of notes payable to common stock

Issuance of common stock for services

Accumulated Comprehensive loss – translation, net

Balances at September 30, 2024

based compensation

of warrants on convertible instruments

of notes payable to common stock

of common stock for services

Comprehensive loss – translation, net

at March 31, 2025

( 159,482,727

Shares and per share amounts are reflective of the

1 for 40 reverse split that occurred on March 27, 2025.

The accompanying notes are an integral part of these

2 unchanged sentences

Condensed Consolidated Statement of Cash Flows

For the Nine Months Ended September 30, 2024 and 2023

$ ( 14,717,161 )

$ ( 15,009,628 )

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

Depreciation and amortization

Amortization of debt discount

ROU assets, net

Common stock issued for services

Non-cash share-based compensation

Changes in working capital items:

Accounts receivable, net

Inventory, net

Prepaid expenses and other current assets

Accounts payable and accrued expenses

Accrued interest payable

Net cash used in operating activities

( 6,383,464 )

( 8,503,765 )

Cash flows from investing activities:

Capital expenditures

Net cash provided by investing activities

Cash flows from financing activities:

Cash advance from related party

Cash advance repayment from related party

Cash advance from shareholder

Proceeds from convertible promissory note

Principal repayment of debt

( 1,542,209 )

Net cash provided by financing activities

Net cash effect of exchange rate changes on cash

Net change in cash and cash equivalents

( 4,335,624 )

Cash and cash equivalents, beginning of year

Cash and cash equivalents, end of period

Supplemental disclosure of cash flow information:

Cash paid for Interest

Supplemental disclosure of non-cash investing and financing activities

Notes payable and accrued interest converted to common stock (13,546,259 shares in 2024)

Creation of debt discounts from the issuance of equity instruments

The accompanying notes are an integral part of these

condensed consolidated financial statements.

For the Three Months Ended March 31, 2025 and 2024

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

and amortization

of debt discount

share-based compensation

in working capital items:

receivable, net

expenses and other current assets

payable and accrued expenses

interest payable

cash used in operating activities

flows from investing activities:

cash used in investing activities

flows from financing activities:

advance (repayment) from related party

advance from shareholder

from issuance of debt

repayment of debt

cash provided by financing activities

cash effect of exchange rate changes on cash

change in cash and cash equivalents

and cash equivalents, beginning of year

and cash equivalents, end of period

disclosure of cash flow information:

paid for Interest

disclosure of non-cash investing and financing activities

payable and accrued interest converted to common stock (224,541 shares in 2025 & 38,800 shares in 2024,)

debt discount in the form of issuance of equity instruments in conjunction with convertible notes

Shares and per share amounts are reflective of the

1 for 40 reverse split that occurred on March 27, 2025.

The accompanying notes are an integral

part of these condensed consolidated financial statements.

Splash Beverage Group, Inc.

Notes to the Condensed Consolidated Financial

Notes to the Condensed Consolidated Financial Statements

Note 1 – Business Organization and Nature of Operations

3 unchanged sentences

within its distribution system.

Splash’s distribution system is comprehensive in the US and is now planning to expand to select

attractive international markets.

Splash’s distribution system is comprehensive in the US and is now expanding to select attractive

international markets.

Through its division Qplash, Splash’s distribution reach includes e-commerce access to both business-to-business

2 unchanged sentences

direct to their office, facilities, and or homes.

On March 27, 2025, the Company implemented a 1.0 for

40.0 reverse stock split.

All common stock shares stated herein have been adjusted to reflect the split.

The purpose of this reverse split

was to maintain the company’s listing on the NYSE American.

Summary of Significant Accounting Policies

9 unchanged sentences

They should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s 2024 Annual

Report on Form 10-K, filed with the SEC on March 31,2024 (the “Form 10-K”).

Report on Form 10-K, filed with the SEC on July 11, 2025 (the “Form 10-K”).

The accompanying condensed consolidated financial

22 unchanged sentences

with an original maturity of three months or less to be cash equivalents.

The Company had no cash equivalents at September 30, 2024 or

December 31, 2023.

The Company had no cash equivalents at March 31, 2025 or December

Our cash in bank deposit accounts, at times, may exceed

federally insured limits of $ 250,000 .

At September 30, 2024, the Company had $120,275 in excess of the federally insured limits.

31, 2023, the Company’s cash on deposit with financial institutions, at times, had not exceeded federally insured limits of $250,000.

At March 31, 2025 and December 31, 2024, the Company’s cash on deposit with financial institutions,

at times, had not exceeded federally insured limits of $ 250,000 .

Splash Beverage Group, Inc.

Notes to the Condensed Consolidated Financial Statements

Notes to the Condensed Consolidated Financial

Note 2 – Summary of Significant Accounting

5 unchanged sentences

balance, and current economic conditions.

At September 30, 2024 and December 31, 2023, our accounts receivable amounts are reflected net

of allowances of $ 595,305 and $ 890,631 , respectively.

Inventory is stated at the lower of cost or net realizable

value, accounted for using the weighted average cost method.

The inventory balances at September 30, 2024 and December 31, 2023 consisted

The inventory balances at March 31, 2025 and December 31, 2024 consisted

of raw materials, work-in-process, and finished goods held for distribution.

7 unchanged sentences

Company manages inventory levels and purchase commitments in an effort to maximize utilization of inventory on hand and under commitments.

The amount of our reserve was $ 227,186 and $ 290,524 at September 30, 2024 and December 31, 2023, respectively.

The amount of our reserve was $ 621,178 at March 31, 2025 and December 31, 2024.

Property and Equipment

7 unchanged sentences

Depreciation expense totaled $ 37,017 and $ 32,214 for

the three months ended September 30, 2024 and September 30, 2023, respectively.

For the nine months ended September 30, 2024 and September

30, 2023 depreciation expense totaled $ 111,271 and $ 98,285 respectively.

Property and equipment as of September 30, 2024 and December

the three months ended March 31, 2025 and March 31, 2024, respectively.

Property and equipment as of March 31, 2025 and December 31, 2024

consisted of the following:

5 unchanged sentences

Accumulated depreciation

( 1,939,564 )

( 1,828,293 )

Property, plant & equipment, net

19 unchanged sentences

The three levels of the fair value hierarchy are as follows:

Unadjusted quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date.

Level 1 primarily consists of financial instruments whose value is based on quoted market prices such as exchange-traded instruments and listed equities.

Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly (e.g., quoted prices of similar assets or liabilities in active markets, or quoted prices for identical or similar assets or liabilities in markets that are not active).

Unobservable inputs for the asset or liability.

Financial instruments are considered Level 3 when their fair values are determined using pricing models, discounted cash flows or similar techniques and at least one significant model assumption or input is unobservable.

quoted prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement

Level 1 primarily consists of financial instruments whose value is based on quoted market prices such as exchange-traded instruments

and listed equities.

Inputs other than quoted

prices included within Level 1 that are observable for the asset or liability, either directly or indirectly (e.g., quoted prices

of similar assets or liabilities in active markets, or quoted prices for identical or similar assets or liabilities in markets that

are not active).

Unobservable inputs for

the asset or liability.

Financial instruments are considered Level 3 when their fair values are determined using pricing models,

discounted cash flows or similar techniques and at least one significant model assumption or input is unobservable.

The liabilities and indebtedness presented on the

condensed consolidated financial statements approximate fair values at September 30, 2024 and December 31, 2023, consistent with recent

negotiations of notes payable and due to the short duration of maturities and market rates of interest.

condensed consolidated financial statements approximate fair values at March 31, 2025 and December 31, 2024, consistent with recent negotiations

of notes payable and due to the short duration of maturities and market rates of interest.

Embedded debt costs

39 unchanged sentences

Other General and Administrative expenses includes

Amazon selling fees, royalty cost for selling TapouT, cost associated with the outbound shipping and handling of finished goods, insurance

cost, consulting cost, legal and audit fees, investor relations expenses, travel & entertainment expenses, occupancy cost and other

Amazon selling fees, cost associated with the outbound shipping and handling of finished goods, insurance cost, consulting cost, legal

and audit fees, Investor Relations expenses, travel & entertainment expenses, occupancy cost and other cost.

Stock-Based Compensation

49 unchanged sentences

Company management

has determined that there are no material uncertain tax positions at September 30, 2024 and December 31, 2023.

has determined that there are no material uncertain tax positions at March 31, 2025 and December 31, 2024.

Net income (loss) per share

5 unchanged sentences

Weighted average number of shares outstanding excludes

anti-dilutive common stock equivalents, including warrants to purchase shares of common stock and warrants granted by our Board that have

not been exercised totaling 107,196,348 .

anti-dilutive common stock equivalents, including stock options, warrants to purchase shares of common stock and shares issuable upon

the conversion of notes payable.

The Company conducts advertising for the promotion

1 unchanged sentence

In accordance with ASC 720-35, advertising costs are charged to operations when incurred.

For the three months ended

September 30, 2024 and September 30, 2023 the Company recorded advertising expenses of $ 216,359 and $ 248,512 , respectively.

recorded advertising expense of $ 403,610 and $ 1,075,127 for the nine months ended September 30, 2024 and 2023, respectively.

The Company recorded advertising

expense of $ 22,426 and $ 77,627 for the three months ended March 31, 2025 and 2024, respectively.

Goodwill and Intangibles Assets

9 unchanged sentences

to be applied to historical and expected future operating results.

The gross amounts and accumulated amortization of

the Company’s acquired identifiable intangible assets with finite useful lives, included in other intangible assets, net in the

accompanying consolidated balance sheets, were as follows:

Schedule of intangible assets, net

Relationships

Intangible Assets

The Company’s

goodwill and intangible assets were impaired to $0 at 12/31/24.

At the time of acquisition, the Company estimates

4 unchanged sentences

finalizes the estimated fair values during the purchase allocation period, which does not extend beyond 12 months from the date of acquisition.

The Company’s amortization expense for acquired identifiable intangible assets with finite useful lives was $ 98,017 for the three

months ended September 30, 2024 and 2023.

Estimated amortization expense for acquired identifiable intangible assets for fiscal year 2024

and the succeeding years is as follows:

The Company’s goodwill and intangible assets were impaired to $ 0 at 12/31/24.

Splash Beverage Group, Inc.

2 unchanged sentences

Policies, continued

Schedule of estimated amortization expense for acquired identifiable intangible assets

Future Intangible Asset

Amortization Expense

2024 (3 months)

Long-lived assets

15 unchanged sentences

Gains or losses from these translation adjustments are included in the condensed consolidated statement of operations

and other comprehensive gain as foreign currency translation gains or losses.

and other comprehensive loss as foreign currency translation gains or losses.

Translation gains and losses that arise from the translation

of net assets from functional currency to the reporting currency, as well as exchange gains and losses on intercompany balances, are included

in foreign currency translation in the condensed consolidated statement of operations and comprehensive gain.

in foreign currency translation in the condensed consolidated statement of operations and comprehensive loss.

The Company incurred foreign

currency translation net gain of $ 85,074 and $ 29,406 for the three months ending September 30, 2024 and 2023, respectively and net gain

of $ 77,819 and $ 12,024 for the nine months ending September 30, 2024 and 2023, respectively.

currency translation net gain of$ 50,694 and net loss of $ 7,437 for the three months ending March 31, 2025 and 2024 respectively.

Liquidity, Capital Resources and Going Concern Considerations

3 unchanged sentences

The Company historically has incurred significant losses and negative cash flows from operation

since inception and had net-loss of approximately $ 14 .0 million for nine-month period ended September 30, 2024 and accumulated deficit

of approximately $146.8 million through September 30, 2024.

During the nine-month period ended September 30, 2024, the Company’s

net cash used in operating activities totaled approximately $ 6.4 million.

Additionally, the Company’s current liabilities exceed

its current assets, and it has a working capital deficit.

During the year ended December 31, 2023, the Company

sustained a net loss of approximately $ 21 .0 million and used cash in operating activities of $ 10.2 million, which excludes non-cash charges

and financing activities.

since inception and had net-loss of approximately $3.6 million for three-month period ended March 31, 2025 and accumulated deficit of

approximately $159.4 million through March 31, 2025.

During the three-month period ended March 31, 2025, the Company’s net cash

used in operating activities totaled approximately $ 0.7 million.

Additionally, the Company’s current liabilities exceed its current

assets, and it has a working capital deficit.

To date the Company has generated cash flows from issuances of equity and indebtedness.

4 unchanged sentences

The Company received approximately $ 0.9 million from

the issuance of debt for the nine months ending September 30, 2024.

This event served to ensure liquidity of the business through September

the issuance of debt for the three months ending March 31, 2025.

Management’s plans in regard to these matters

1 unchanged sentence

business plan.

However, there is no assurance that the Company will be successful in implementing its plans or in raising additional funds.

If the Company is unable to raise additional funding to meet its working capital needs in the future, it may be forced to delay, reduce,

or cease its operations.

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

The Company has issued preferred stock as part of its strategy to regain compliance with the NYSE American listing standards

and reduce debt.

These preferred shares, specifically Series B 12% convertible preferred stock, were issued in exchange for promissory

The preferred stock offers a 12% cumulative dividend and potential conversion to common stock, subject to shareholder approval

and an increase in authorized common stock.

In June 2025, the company exchanged approximately $12.67 million outstanding promissory

notes and accrued interest for 126,710 shares of Series B Preferred Stock.

By converting debt into equity, the Company enhances its balance

sheet, reduces interest expense, and improves its shareholder equity position in furtherance of its goal of complying with exchange requirements.

The financial statements do not include any adjustments

22 unchanged sentences

Note 3 – Notes Payable, Related Party

Notes Payable, Convertible Bridge Loans Payable, Revenue Financing Arrangements and Bridge Loan Payable

Notes Payable, Convertible Bridge Loans Payable, Revenue Financing Arrangements and Bridge Loan Payabl e

Notes payable are generally nonrecourse and secured

1 unchanged sentence

Schedule of notes payable

September 30,

Notes Payable and Convertible Notes Payable

5 unchanged sentences

The loan had an original maturity of October 2021 with principal and interest due at maturity.

The loan was extended to April 2025.

In May 2021, the Company entered into a six-month loan with two individuals totaling $ 60,000 .

The loan was converted to Preferred stock in June 2025.

In May 2021, the Company entered into a six-month loan with an individual in the amount of $ 50,000 .

The loan had an original maturity of October 2021 with principal and interest due at maturity.

The loan was extended to April 2025.

The loan was converted to Preferred stock in June 2025.

In May 2021, the Company entered into a six-month loan with an individual in the amount of $ 10,000 .

The loan had an original maturity of October 2021 with principal and interest due at maturity.

The loan was extended to October 31, 2024.

The note was in default.

In August 2022, the Company entered into a 56-months auto loan in the amount of $ 45,420 .

2 unchanged sentences

The loans mature in June 2024 with principal and interest due at maturity with conversion price of $ 1.00 per share.

In February 2023, the Company entered into a twelve-month loan with an entity in the amount of $ 2,000,000 .

The convertible note included the issuance of 1,500,000 shares of common stock.

The loan matures in February 2024 with conversion price of $ 0.85 per share and is non-interest bearing.

The loan was extended to May, 2024.

As of June 2024, the loan was fully converted.

The loans were converted to Preferred stock in June 2025.

In December 2022, the Company entered into an eighteen-month loan with an individual in the amount of $ 1,000,000 .

The notes included 100 % warrant coverage.

The loan was converted to Preferred stock in June 2025.

In May 2023, the Company entered into various eighteen-month loans with individuals totaling in the amount of $ 800,000 .

1 unchanged sentence

The loans mature in November 2024 with principal and interest due at maturity with conversion price of $ 1.00 per share.

The loans were extended to May 2025.

The loans were converted to Preferred stock in June 2025.

In June 2023, the Company entered into various eighteen-month loans with individuals totaling in the amount of $ 350,000 .

1 unchanged sentence

The loans mature in December 2024 with principal and interest due at maturity with conversion price of $ 1.00 per share.

In July 2023, the Company entered into a twelve-month loan with an individual in the amount of $ 750,000 .

The note included 50 % warrant coverage.

The loan matures in July 2024 with principal and interest due at maturity with conversion price of $ 1.00 per share.

The loan was fully converted in September 2024.

The loans were converted to Preferred stock in June 2025.

In July 2023, the Company entered into a twelve-month loan with an individual in the amount of $ 100,000 .

The note included 50 % warrant coverage.

The loan originally matures in June 2024 with principal and interest due at maturity with conversion price of $ 1.00 per share.

The loan was extended to January 2025.

The loan matures in January 2025 with principal and interest due at maturity with conversion price of $ 1.00 per share.

The loan was converted to Preferred stock in June 2025.

In August 2023, the Company entered into a twelve-month loan with an individual in the amount of $ 300,000 .

The convertible note included the issuance of 150,000 shares of common stocks.

The loan matures in August 2024 with principal due at maturity with conversion price of $ 0.85 per share and is non-interest bearing.

Partial of the note was converted into common stock.

The loan matures in August 2024 with principal and interest due at maturity with conversion price of $ 0.85 per share and is non-interest bearing.

In October 2023, the Company entered into a three-month loan with an individual in the amount of $ 500,000 .

The loan matures in January 2024 with principal and interest due at maturity.

The loan was extended to February 2025.

In October 2023, the Company entered into a loan with an individual in the amount of $ 196,725 The loan matures in March 2024.

Note is guaranteed by a related party.

As of March 2024, the loan was fully paid off.

The loan was extended to June 2024.

In October 2023, the Company entered into a loan with an individual in the amount of $ 130,000 .

3 unchanged sentences

The loan matures in April 2025 with principal and interest due at maturity with conversion price of $ 1.00 per share.

Partial principal and 1 st year interest were converted in September 2024.

In December 2023, the Company entered into a 2.5-month loan with an individual in the amount of $ 450,000 .

The loan had a maturity of March 2024 with principal and interest due at maturity.

The loan was extended to February 2025.

The loan was fully converted in January 2025

In January 2024, the Company entered into a 18-month loan with an individual in the amount of $ 250,000 .

1 unchanged sentence

The loan had a maturity of July 2025 with principal and interest due at maturity with conversion price of $ 0.50 per share.

The loan was converted to Preferred stock in June 2025.

In February 2024, the Company entered into a 18-month loan with an individual in the amount of $ 150,000 .

1 unchanged sentence

The loan had a maturity of August 2025 with principal and interest due at maturity with conversion price of $ 0.40 per share.

The loan was converted to Preferred stock in June 2025.

In February 2024, the Company entered into a 6-month loan with an individual in the amount of $ 315,000 .

1 unchanged sentence

The loan had a maturity of August 2024 with principal and interest due at maturity with conversion price of $ 0.38 per share.

This was extended to July 2025.

The loan was converted to Preferred stock in June 2025.

In February 2024, the Company entered into a 18-month loan with an entity in the amount of $ 250,000 .

1 unchanged sentence

The loan matures in August 2025 with principal and interest due at maturity with conversion price of $ 0.46 per share.

The loan was converted to Preferred stock in June 2025.

In April 2024, the Company entered into a commercial financing agreement in the amount of $ 815,000 and will be paid weekly until the loan is paid in full.

The loan was in default.

In May 2024, the Company entered into an eighteen-month loan with individuals totaling in the amount of $ 1,850,000 .

1 unchanged sentence

The loan matures in November 2026 with principal and interest due at maturity with conversion price of $ 0.40 per share

In June 2024, the Company entered into a merchant cash advance agreement in the amount of $ 325,000 to be paid weekly until the loan is paid in full.

This loan was paid off in September

In June 2024, the Company entered into a revenue purchase agreement in the amount of $ 250,000 .

2 unchanged sentences

The loan matures in April 2025.

10 equal P&I payments starting in July 2024

The loan was fully converted to Common Stock in January 2025.

In July 2024, the Company entered into a revenue purchase agreement in the amount of $ 120,750 .

The loan matures in May 30, 2025.

1 st P&I payment will be starting Jan 2025.

In August 2024, the Company entered into a 5-year loan

with individuals totaling in the amount of $ 500,000 .

The loan matures in September 2029 with principal and interest due at maturity with conversion price of $ 0.35

In August 2024, the Company entered into a eighteen-month

loan with individuals totaling in the amount of $ 1,500,000 .

The loan matures in February 2026 with principal and interest due at maturity with conversion price of $ 0.38

In September 2024, we entered into a merchant cash advance agreement in the amount of $ 325,000 to be paid weekly until the loan is paid in full.

The loan was fully converted to Common Stock in January 2025

In August 2024, the Company entered into a 5-year loan with individuals totaling in the amount of $ 500,000 .

The loan matures in September 2029 with principal and interest due at maturity with conversion price of $ 0.35 per share.

The loans were converted to Preferred stock in June 2025.

In August 2024, the Company entered into a eighteen-month loan with individuals totaling in the amount of $ 1,400,000 .

The loan matures in February 2026 with principal and interest due at maturity with conversion price of $ 0.38 per share.

$ 800,000 was converted to Preferred stock in June 2025.

In August 2024, the Company entered into a eighteen-month loan with individuals totaling in the amount of $ 100,000 .

The loan matures in September 2025 with principal and interest due at maturity with conversion price of $ 0.38 per share.

The loan was converted to Preferred stock in June 2025.

In September 2024, the Company entered into a merchant cash advance agreement in the amount of $ 325,000 to be paid weekly until the loan is paid in full.

In September 2024, the Company entered into an agreement with individuals totaling in the amount of $ 590,000 .

$ 290,000 was converted to Preferred stock in June 2025

In October 2024, the Company entered into an agreement with individuals totaling in the amount of $ 950,000

In November 2024, the Company entered into a merchant cash advance agreement in the amount of $ 340,000 to be paid weekly until the loan is paid in full.

The loan was in default.

In December 2024, the Company entered into a merchant cash advance agreement in the amount of $ 111,300 to be paid weekly until the loan is paid in full.

In December 2024, the Company entered into a twelve-month loan with an individual in the amount of $ 500,000 .

The loan matures in December 2025 with principal and interest due at maturity.

In January 2025, the Company entered into a 12-month loan with individuals in the amount of $ 350,000 .

The note included 100 % warrant coverage.

The loan had a maturity of January 2026 with principal and interest due at maturity with conversion price of $ 0.25 per share.

The loans were converted to Preferred stock in June 2025.

In January 2025, the Company entered into a 18-month loan with individuals in the amount of $ 225,000 .

The note included 100 % warrant coverage.

The loan had a maturity of June 2026 with principal and interest due at maturity with conversion price of $ 0.25 per share.

The loans were converted to Preferred stock in June 2025.

In January 2025, the Company entered into a convertible promissory note in the amount of $ 156,000 .

The loan had a maturity of November 2025 with principal and interest due at maturity.

In January 2025, the Company entered into a promissory note in the amount of $ 150,650 .

The loan had a maturity of November 2025 with 1 st payment in July 2025.

Total notes payable

Less notes discount

( 3,977,802 )

( 2,876,387 )

Less current portion

( 8,974,659 )

( 7,748,518 )

Long-term notes payable

4 unchanged sentences

Interest expense on notes payable was $ 637,345 and

$ 207,087 for the three months ended September 30, 2024 and 2023, respectively.

Interest expense on notes payable was $ 2,026,523 and $ 546,849

for the nine months ended September 30, 2024 and 2023, respectively.

$ 533,578 for the three months ended March 31, 2025 and 2024, respectively.

Accrued interest amounted to $ 3,805,534 as of March 31, 2025.

The Company recognized approximately $ 978,720 and approximately $ 886,838

of interest expense attributable to the amortization of the debt discount during the three months ended September 30, 2024 and 2023, respectively.

The Company recognized approximately $ 2,730,857 and approximately $ 2,500,065 of interest expense attributable to the amortization of the

debt discount during the nine months ended September 30, 2024 and 2023, respectively.

As of September 30, 2024, and December 31, 2023, the balance of the unamortized

debt discount was $ 3,534,793 and $ 1,944,348 respectively.

The Company adopted ASU 2020-06 on January 1, 2024, which resulted in the reversal

of the original bifurcated derivative (BCF) amount to additional paid in capital for $ 2,191,103 , reversal of the unamortized debt discount

related to the bifurcated derivative (BCF) for $ 932,047 with the balance being recorded through retained earnings for $ 1,259,056 .

of interest expense attributable to the amortization of the debt discount during the three months ended March 31, 2025 and 2024, respectively.

As of March 31, 2025, and December 31, 2024, the

balance of the unamortized debt discount was $ 2,550,199

and $ 3,031,514

respectively.

The Company adopted ASU 2020-06 on January 1, 2024, which resulted in the reversal of the original beneficial

conversion feature (BCF) amount to additional paid in capital for $ 2,191,103 ,

reversal of the unamortized debt discount related to the beneficial conversion feature (BCF) for $ 932,047

with the balance being recorded through retained earnings for $ 1,259,056 .

Schedule of notes payable

1 unchanged sentence

Shareholder Notes Payable

In April 2024, revised Feb 2023 shareholder advance in the amount of $ 200,000 .

The annual interest rate is 12 % with a conversion price of $ 0.35 per share.

The revised note included 571,429 share of warrant coverage.

The loan matures in July 2025 with interest due semi-annually.

In February 2023, we entered into a loan with an individual in the amount of $ 200,000 .

The annual interest rate is 12 %.

The loans was converted to Preferred stock in June 2025.

Less current portion

1 unchanged sentence

Interest expense on related party notes payable was

$ 6,000 and $ 0 for the three months ended September 30, 2024 and 2023, respectively.

Interest expense on related party notes payable was

$ 11,030 and $ 0 for the nine months ended September 30, 2024 and 2023, respectively.

The Company’s effective interest rate was 26.71 %

for the nine months ended September 30, 2024.

As of September 30, 2024, the Company’s convertible

$6,000 for the three months ended March 31, 2025 and 2024, respectively.

The Company’s effective interest rate was 21.80% for the

three months ended March 31, 2025.

As of March 31, 2025, the Company’s convertible

note balances are convertible into 461,728 shares of common stock

Note 4 – Licensing Agreement and Royalty

The Company has a licensing agreement with ABG TapouT,

LLC (“TapouT”), providing the Company with licensing rights to the brand “TapouT” (i)energy drinks, (ii) energy

bars, (iii) coconut water, (iv) electrolyte gum/chews, (v) energy shakes, (vi) powdered drink mix, (viii) water (including enhanced water),

(vii) energy shots, (viii) teas, and (ix) sports drinks sold in the North America (including US Territories and Military Bases), United

Kingdom, Brazil, South Africa, Australia, Scandinavia, Peru, Colombia, Chile and Guatemala.

The Company is required to pay a 6% royalty

on net sales, as defined, and are required to make minimum monthly payments of $ 55,000 in 2024 and 2023.

Splash Beverage Group, Inc.

Notes to the Condensed Consolidated Financial

The Company has accrued guaranteed minimum

royalty payments of $ 0

for the three months ended September 30, 2024 and $ 55,000

for nine months ended in September 2024.

The royalty expense $ 55,000

is included in general and administrative expenses.

The Company has reserved $ 330,000

that is included in legal reserve in the condensed consolidated statement of operations and comprehensive loss.

The licensing agreement between TapouT LLC and the Company was terminated

The parties are engaged in active and constructive settlement discussions pursuant to the terms of the agreement’s termination

Based on the settlement discussions, the Company anticipates that any final settlement will not exceed the amounts already

recorded in its legal reserve and accrued accounts payable.

The Company has reserved $ 330,000 that is included in legal reserve in the

condensed consolidated statement of operations and comprehensive loss relating to the termination of the ABG agreement.

In connection with the Copa di Vino APA, the Company

8 unchanged sentences

The asset is being amortized over a 10-year useful life.

Splash Beverage Group, Inc.

Notes to the Condensed Consolidated Financial

Note 5– Stockholders’ Equity

On September 29, 2023, the Company entered into a

securities purchase agreement with certain accredited investors.

Pursuant to such agreements, the Company sold:

(i) senior convertible

notes in the aggregate original principal amount of $1,250,000, convertible into up to 1,470,588 shares of common stock of the Company,

par value $0.001 per share (“Common Stock”), subject to adjustments as provided in the Notes, (ii) 625,000 shares of Common

Stock (the “Commitment Shares”), (ii) warrants to acquire up to an aggregate of 1,250,000 additional shares of Common Stock

(the “Warrants”) at an exercise price of $0.85 per Warrant Share.

On May 1, 2024, the Company entered into a securities

purchase agreement with certain accredited investors.

Pursuant to such agreements, the Company sold:

(i) senior convertible notes in the

aggregate original principal amount of $1,850,000, convertible into up to 4,625,000 shares of Common Stock, subject to adjustments as

provided in the Notes, (ii) 925,000 shares of Common Stock (the “Commitment Shares”), (ii) warrants to initially acquire up

to an aggregate of 4,625,000 additional shares of Common Stock (the “Warrants”) at an exercise price of $0.85 per Warrant

During the nine-months ended September 30, 2024, the

Company granted share-based awards to certain consultants totaling 1,639,190 shares of common stock at a weighted average price of $0.24,

200,000 shares for extension of note, 15,212,629 shares on conversion of convertible instruments, 925,000 shares on debt discount and

290,000 shares for non-cash compensation.

A convertible promissory note was issued to shareholder

on April 15, 2024 for $ 200,000 at 12 % with conversion price of $0.35 per share.

The note included 571,429 share of warrant

The loan matures in July 2025 with principal and interest due semi-annually.

Accrued interest of advance $ 27,370 will be made

on or before August 15, 2024.

On March 27, 2025, the Company implemented a 1.0 for

40.0 reverse stock split.

The reverse stock split was authorized by the Company’s Board of Directors on March 14, 2025.

stock shares stated herein have been adjusted to reflect the split.

The purpose of this reverse split was to ensure that the Company can

meet the per share price requirements of the NYSE American.

During the three-months ended March 31, 2025, we

shares valued at $ 35,000

in exchange for services and 224,541

shares for conversion of notes payable and accrued interest totaling $ 1,665,953 .

Preferred Stock

As of the date of this filing, the Company has issued four series of preferred

Series A, A-1, B, and C , each with distinct rights and preferences as outlined below.

Note agreements were amended to be

exchanged for Preferred B and the impact of those amendments is subject to further review.

Voting Rights

Series A carries 25,000 votes per share but is limited solely to voting on the authorization of additional shares.

It has no other voting rights.

Series A is expected to be retired following the special meeting.

Series A-1 carries 231 votes per share.

Series B and Series C do not carry any voting rights.

Series A does not accrue dividends.

Series A-1 and Series B carry a fixed 12% annual dividend, payable quarterly in arrears, in either cash or payment-in-kind (PIK) at the Company’s discretion.

These dividends are mandatory and take priority over any dividends on common stock, regardless of whether common stock dividends are declared.

Series C does not accrue dividends.

Conversion into Common Stock

Series A is not convertible.

Series A-1 is convertible into common stock at 80% of the VWAP, subject to a floor of $1.25 and a ceiling of $4.00.

A-1 is convertible into a range of 162,500 to 520,000 common shares.

Series B is also convertible at 80% of the VWAP, with a floor of $1.25 and a ceiling of $6.00, and is convertible into a range of 2,118,333 to 10,168,000 common shares.

Series C is convertible at a fixed price of $3.00, resulting in the potential issuance of 6,666,667 common shares upon conversion.

Redemption – at the sole discretion of the Company.

Series A is redeemable by the Company after the special meeting for $1,000.

Series A-1 and Series B are redeemable by the Company after two years from the date of issuance, for $650,000 and $12,700,000, respectively.

Series C is not redeemable.

Series B is the most senior class (Seniority Level 1).

Series A-1 ranks junior to Series B (Seniority Level 2).

Series C is the most junior class (Seniority Level 3).

Series A is a governance-related instrument and does not participate in liquidation or dividend preferences.

2020 Plan adjusted for the 1 for 40 reverse split.

In July 2020, the Board adopted the 2020 Stock Incentive

2 unchanged sentences

The total number of shares that may be issued under the 2020 plan

was 1,685,825 at the time the 2020 plan was adopted as of September 30, 2024.

was 152,383 as of March 31, 2025.

The 2020 Plan has an “evergreen” feature,

1 unchanged sentence

and outstanding common shares at year end, unless otherwise adjusted by the board.

At January 1, 2023 and 2024, the number of shares issuable

under the 2020 plan increased by 2,054,276 and 2,984,276 shares, respectively.

Splash Beverage Group, Inc.

Notes to the Condensed Consolidated Financial

In October 2023, the shareholders voted to increase

the number of shares issuable under the Plan to 7.5%.

At January 1, 2024 and 2025, the number of shares issuable under the 2020 plan increased

by 83,119 and 125,238 shares, respectively.

The following is a summary of the Company’s

1 unchanged sentence

Schedule of stock option activity

September 30, 2024

September 30, 2023

March 31, 2025

March 31, 2024

Number of Options

4 unchanged sentences

Balance – March 31,

Balance – June 30,

Balance – September 30,

Exercisable – September 30,

Note 5– Stockholders’ Equity, continued

During the nine-month period ended September 30, 2024

and September 30, 2023, the company granted 4,485,000 and 3,441,008 options to employees and directors at weighted average strike price

of $ 0.33 under the 2020 plan.

1,200,000 shares were granted to CEO, Robert Nistico, 750,000 shares to CMO, William Meissner, 750,000 shares

to CFO, Julius Ivancsits, 600,000 to the Board director, John Paglia and 475,000 shares to Board director, Bill Caple.

Exercisable – March 31,

During the three-month period ended March 31, 2025

and March 31, 2024, the company granted 15,000 and 15,750 options to new employees under the 2020 plan.

The fair value of stock options granted in the period

has been measured at $ 90,587 using the Black-Scholes option pricing model with the following assumptions:

exercise price $ 0.33 - $ 0.53 ,

expected life 5 to 7 years, expected volatility 254 %, expected dividends 0 %, risk free rate 4.64 %.

exercise price $ 6.04 , expected

life 10 years, expected volatility 254 %, expected dividends 0 %, risk free rate 4.0 %.

Splash Beverage Group, Inc.

Notes to the Condensed Consolidated Financial

Note 5 – Stockholders’ Equity, continued

Common Stock Issuable, Liability to Issue Stock

and Shareholder Advances

Outstanding balance for shareholder advances on March

31, 2025 and 2024 was $ 200,000 .

Note 6 – Related Parties

5 unchanged sentences

(the “Lender”).

The Note Payable with a balance of $ 232,776 at September 30, 2024 and $ 371,693 at December 31, 2023.

Splash Beverage Group, Inc.

Notes to the Condensed Consolidated Financial

The Note Payable to Decathlon with a balance of $ 1,995,950 at December 31, 2024 and $ 1,361,395 at December

On April 2024, the Company also entered into a Merchant

Cash Advance Agreement (the “Loan and Security Agreement”) by and among the Company, Robert Nistico, additional Guarantor

and each of the subsidiary guarantors from time-to-time party thereto (each a “Guarantor”, and, collectively, the “Guarantors”),

and Cobalt Funding Solutions (the “Lender”).

The Loan and Security Agreement provided a loan of $815,000, with the gross and

interest amount of $326,028 with the Lender (the “Credit Facility”).

There was $377,334 outstanding under this agreement as

of March 31, 2025.

On September 2024 and November 2024 the Company also

entered into a Merchant Cash Advance Agreement (the “Loan and Security Agreement”) by and among the Company, Robert Nistico,

additional Guarantor and each of the subsidiary guarantors from time-to-time party thereto (each a “Guarantor”, and, collectively,

the “Guarantors”), and with Timeless Funding LLC (the “Lender”).

The Loan and Security Agreement provided a loan

of $ 325,000 and $340,000, with the gross and interest amount of $ 172,250 and $173,400 respectively with the Lender (the “Credit

There was $ 67,861 and $311,713 respectively outstanding under this agreement as of March 31, 2025.

There were related party advances from our chief executive

officer in the amount of approximately $ 0.4 million outstanding as of September 30, 2024 and approximately $ 0.4 million as of December

A shareholder note payable outstanding in the amount of $ 0.2 million as of September 30, 2024.

officer in the amount of approximately $ 0.4 million outstanding as of March 31, 2025 and approximately $ 0.4 million as of December 31,

This amount includes a shareholder note payable in the amount of $ 0.2 million outstanding as of March 31, 2024.

The annual interest

rate of the note is 12 % with a conversion price of $ 14.0 per share.

The note includes 14,285 shares of warrant coverage.

Note 7 – Investment in Salt Tequila USA,

5 unchanged sentences

Note 8 – Leases

The Company has various operating lease agreements primarily related to real

estate and office space.

The Company has various operating lease agreements

primarily related to real estate and office.

The Company’s real estate leases represent a majority of the lease liability.

Lease payments are mainly

Any variable lease payments, including utilities, and common area maintenance are expensed during the period incurred.

lease costs were immaterial for the quarter ended September 30, 2024 and 2023.

A majority of the real estate leases include options to

extend the lease.

Management reviews all options to extend at the inception of the lease and account for these options when they are reasonably

certain of being exercised.

payments are mainly fixed.

Any variable lease payments, including utilities, common area maintenance are expensed during the period incurred.

Variable lease costs were immaterial for the quarter ended March 31, 2025 and 2024.

A majority of the real estate leases include options

to extend the lease.

Management reviews all options to extend at the inception of the lease and account for these options when they are

reasonably certain of being exercised.

Operating lease expense is recognized on a straight-line

1 unchanged sentence

comprehensive loss.

Operating lease cost was $ 277,564 and $ 273,631 during the nine-month period ended September 30, 2024 and 2023, respectively.

Operating lease cost was $ 88,603 and $ 97,953 during the period ended March 31, 2025 and 2024, respectively.

The following table sets for the maturities of our

operating lease liabilities and reconciles the respective undiscounted payments to the operating lease liabilities in the consolidated

balance sheet at September 30, 2024

Schedule of operating lease liabilities

balance sheet at March 31, 2025

of operating lease liabilities

Undiscounted Future Minimum Lease Payments

Operating Lease

2024 (three months remaining)

2025 (Nine months remaining)

Amount representing imputed interest

6 unchanged sentences

The table below presents lease-related terms and discount

rates at September 30, 2024:

Schedule of lease related terms and discount

rates at March 31, 2025:

Schedule of lease- related terms and

discount rates

Remaining term on leases

10 unchanged sentences

Splash Beverage Group segment.

Schedule of segment

Three Months Ended September 30

Nine Months Ended September 30

of segment reporting information

March 31, 2025

March 31, 2024

Splash Beverage Group

Net revenues, continuing operations

Contribution after Marketing

Total revenues, net, continuing operations

Segment operating loss:

March 31, 2025

March 31, 2024

Splash Beverage Group

( 1,468,564 )

Total contribution after marketing

Contracted services

Salary and wages

Non-cash share-based compensation

Other general and administrative

Reconciliation of segment loss to corporate loss:

March 31, 2025

March 31, 2024

Other income/expense

Amortization of debt discount

Interest income and expenses

Loss from continuing operations

$ ( 2,669,593 )

$ ( 4,323,531 )

$ ( 9,664,687 )

$ ( 11,999,801 )

September 30, 2024

March 31, 2025

December 31, 2024

8 unchanged sentences

business, financial condition or results of operations.

On June 5, 2024 , the Company

received notification from the NYSE American LLC (“NYSE American”) indicating that it is not in compliance with the NYSE

American’s continued listing standards under Section 1003(a)(iii) of the NYSE American Company Guide (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.

The Company is now subject to the procedures and requirements

of Section 1009 of the Company Guide.

If the Company is not in compliance with the continued listing standards by April 6, 2025 or if

the Company does not make progress consistent with the Plan during the plan period, the NYSE American may commence delisting procedures.

Note 11 – Subsequent

The notes that matured in October 2024 was extended

by the note holders to April 2025 .

The note that matured in August 2024 was partially

converted to common stock in September and the remaining was converted in October 2024.

In November 2024, the company entered into a merchant

cash advance agreement in the amount of $ 273,600 to be paid weekly until the loan is paid in full.

On June 5, 2024, the Company received notification

from the NYSE American LLC (“NYSE American”) indicating that it is not in compliance with the NYSE American’s continued

listing standards under Section 1003(a)(iii) of the NYSE American Company Guide (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.

The Company is now subject to the procedures and requirements of Section 1009

of the Company Guide.

If the Company is not in compliance with the continued listing standards by April 6, 2025 or if the Company does

not make progress consistent with the Plan during the plan period, the NYSE American may commence delisting procedures.

The licensing agreement between TapouT LLC and the

Company was terminated in Q1 2024.

The parties are engaged in active and constructive settlement discussions pursuant to the terms of

the agreement’s termination provisions.

Based on the settlement discussions, the Company anticipates that any final settlement will

not exceed the amounts already recorded in its legal reserve and accrued accounts payable.

Note 11 – Subsequent Events

In April 2025, the Company issued a 5-year promissory

note in the amount of $200,000, it accrues interest at 15%, and is convertible into shares of common stock at $1.25.

The note also received

125,000 5-year warrants exercisable at $2.00, and 83,334 5-year warrants exercisable into common stock at $3.00.

In May 2025, the Company issued 650 shares of Series A-1 Preferred Stock

in exchange for approximately $650,000.

Series A-1 shares are convertible into common stock, subject to shareholder approval, and further

discussed in Note 5.

Investors of A-1 Shares also received 162,500 1-year A Warrants exercisable into common stock at 80% of 5-day VWAP,

and 162,500 5-year B Warrants exercisable into common stock at $4.00.

The accounting treatment of this transaction is subject to further

review and may be adjusted in the future.

In June 2025, the Company issued 1000 shares of Preferred A Stock.

A is super voting preferred, not convertible into common stock, and further discussed in Note 5.

In June 2025, the Company issued 126,710 shares of Series B Preferred Stock

in exchange for approximately $12.7 million in previously outstanding convertible notes.

The Series B shares are convertible into common

stock, subject to shareholder approval and further discussed in Note 5.

The accounting treatment of this transaction is subject to further

review and may be adjusted in the future.

In June 2025, the Company acquired certain assets, including all contractual

water rights to the aquifer located in Garabito, Puntarenas, Costa Rica.

The Company issued 20,000 shares of Series C Preferred Stock

as consideration, at an initial stated value of $1000 per share.

Management determined that the transaction is an asset acquisition under

ASC 805, as substantially all of the fair value is concentrated in a single identifiable asset—the water rights—and no substantive

processes were acquired.

The fair value of the acquired assets has been preliminarily estimated at $20 million and is subject to further

evaluation and assessment.

The Series C shares are convertible into common stock, subject to shareholder approval, and further discussed

Pro Forma Adjustments from Subsequent Events

The accounting treatment of these transaction is subject to further review

and may be adjusted in the future.

During the second quarter of 2025, Splash Beverage Group, Inc.

several strategic financing initiatives.

The unaudited pro forma balance sheet reflects the estimated accounting impact of these transactions

as if they had occurred on March 31, 2025.

Each adjustment column corresponds to a discrete event, as described below:

Preferred Stock A-1

Splash issued 650 shares of Preferred Stock A-1 for cash proceeds of $650,000.

The net impact of this transaction is a $650,000 increase in stockholders’ equity, reflecting the cash received.

See Note 5 for

additional details of Preferred Stock A-1.

Preferred Stock B – Debt Exchange

The Company exchanged previously issued convertible notes for 126,710 shares

of Preferred Stock B, eliminating $7,699,596 of current liabilities and $2,070,712 of long-term liabilities.

These liabilities were previously

carried net of unamortized discounts.

The exchange was a non-cash transaction and resulted in a $9,770,307 increase in stockholders’

Debt agreements were amended to be exchanged for Preferred B and the impact of those amendments is subject to further review.

See Note 5 for additional details of Preferred Stock B.

Preferred Stock C – Asset Acquisition

Splash issued 20,000 shares of Preferred Stock C in exchange for non-current

assets largely consisting of water rights located in Garabito, Puntarenas, Costa Rica.

The asset was recorded at $20,000,000, with a corresponding

increase to stockholders’ equity.

This non-cash transaction supports the Company’s business strategy.

See Note 5 for additional

details of Preferred Stock C.

Senior Convertible Note

Splash issued a $200,000 senior convertible note with

a $30,000 original issuance discount, and warrant coverage that resulted in the recognition of a note discount in the amount of $153,924.

of fair value of the warrant-related

derivative liability

The Period Ended M arch 31, 2025

and cash equivalents

current assets

Investment in Garabito, Puntarenas, Costa Rica Water Rights

Investment in Salt Tequila USA, LLC

and equipment, net

non-current assets

and Stockholders' Equity (Deficit)

payable and accrued expenses

of use liability - current

party notes payable

payable, net of discounts

interest payable

current liabilities

party notes payable - noncurrent

payable - net of discounts

of use liability - net of current portion

long-term liabilities

Stockholders'

stock, Series A-1 $0.001 par value, 1,500 shares authorized, 650 shares

issued and outstanding

stock Series B, $0.001 par value, 12% cumulative, 150,000 shares authorized

, 126,200 shares issued and outstanding

stock Series C, $0.001 par value, 500,000 shares authorized, 20,000 shares

issued and outstanding

Common Stock, $0.001 par, 7,500,000 shares authorized,1,899,876 and 1,669,835 shares issued and outstanding, at March 31, 2025 and

Dec 31, 2024, respectively

paid in capital

Accumulated Comprehensive Income - Translation

Accumulated deficit

( 159,482,727

stockholders' equity

liabilities and deficiency in stockholders' equity

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-Q

Item 1. Financial Statements