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IVFH · All filings · Read this filing

What changed 10-K

Item 5. Market for Registrant’s Common Equity

2024-03-21 compared with 2023-03-31 · 132 added, 74 removed, 180 unchanged (53% of the section changed)

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Recent Sales and Other Issuances of Our Equity Securities

During the year ended December 31, 2022, the Company had the following equity related, nonregistered transactions:

During the year ended December 31, 2022, the Company accrued the amount of $466,186 representing 1,768,348 shares of common stock issuable at an average price of $0.29 per share to its then Chief Executive Officer pursuant to his compensation agreement.

During the year ended December 31, 2022, the Company issued 142,857 shares with a value of $48,543 to a service provider.

During the year ended December 31, 2022, the Company issued 33,445 shares issued with a value of $11,405 to an employee as compensation.

During the year ended December 31, 2022, the Company accrued a total of $40,000 representing 103,256 shares of common stock issuable to two Directors.

On February 1, 2023, the Company issued 875,000 shares of common stock to its previous CEO and a board member in connection with his compensation agreement.

These shares were previously accrued at an average price of $0.22 per share.

On February 28, 2023, the Company issued a total of 267,030 shares of common stock at a price of $0.42 per share to three employees as compensation.

On April 26, 2023, the Company issued 400,000 shares of common stock to its previous CEO and a board member pursuant to a separation agreement.

These shares were previously accrued at a price of $0.42 per share.

On July 7, 2023, the Company issued 178,626 shares to its previous CEO pursuant to his compensation plan.

These shares were previously accrued at a price of $0.23 per share.

This issuance did not increase the number of shares outstanding.

On August 31, 2023, the Company issued 14,754 shares to its previous Director of Strategic Acquisitions pursuant to his compensation plan.

These shares were previously accrued at a price of $0.23 per share.

This issuance did not increase the number of shares outstanding.

On September 6, 2023, the Company issued an aggregate of 459,211 shares to two board members pursuant to their compensation plan.

These shares were previously accrued at a price of $0.23 per share.

This issuance did not increase the number of shares outstanding.

On September 6, 2023, the Company issued 320 shares to a previous employee as a bonus.

These shares were previously accrued at a price of $0.44 per shares.

This issuance did not increase the number of shares outstanding.

On October 2, 2023, 30,000 shares were issued to a service provider.

These shares were previously accrued at a price of $1.30 per share.

This issuance did not increase the number of shares outstanding.

On November 7, 2023, the Company issued 678,302 shares, net of 265,229 shares withheld for taxes, at a price of $0.59 per shares to its CEO pursuant to his compensation plan.

On December 30, 2023, the Company issued an aggregate of 57,560 shares were issued to two board members, its previous CEO, and its previous Director of Strategic Acquisitions for the cashless exercise of 360,000 stock options at a price of $0.62 per share.

On February 15, 2024, 150,000 shares were issued to a previous board member for options previously exercised at a price of $0.44 per shares.

The issuance of these shares was previously accrued.

This issuance did not increase the number of shares outstanding.

All of the issuances described above were exempt from registration pursuant to Section 4(2) of the Securities Act of 1933 for the following reasons:

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December 31, 2022

The following table summarizes the options outstanding and the related prices for the options to purchase shares of the Company’s common stock issued by the Company as of December 31, 2021:

The following table summarizes the options outstanding and the related prices for the options to purchase shares of the Company’s common stock issued by the Company at December 31, 2022:

Securities Authorized for Issuance Under Equity Compensation Plans

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(“IVFH”), a Florida corporation formed for that purpose.

As a result of the merger, we changed our name to that of Innovative Food Holdings, Inc.

In January 2004, we also acquired Food Innovations, Inc.

(“FII” or “Food Innovations”), a Delaware corporation, for 500,000 shares of our common stock.

Our strategy has been to increase our sales through a combination of acquisitions and organic growth;

through December 31, 2022 we have completed a total of eight acquisitions.

Transactions With a Major Customer

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Year Ended December 31, 2023 Compared to Year Ended December 31, 2022

Revenue increased by $17,890,816 or approximately 29% to $80,102,964 for the year ended December 31, 2022 from $62,212,148 in the prior year.

The increase in revenues is primarily attributable to an increase in specialty foodservice revenues which was driven by the nationwide opening of restaurants and other foodservice establishments previously affected by COVID-19 as well as increases in travel related foodservice, and restaurant dining.

The increase in specialty foodservice revenue was partially offset with decreases in e-commerce revenues.

The decrease in e-commerce revenue during the current period was related to decreases in COVID-19 driven demand in 2022 compared to 2021 partially driven by the continued re-opening of bricks and mortar stores, and by decreases in digital marketing related in part to a more challenging digital marketing environment as compared to 2021 which has been driven partially by industrywide marketing challenges related to expanded privacy rules that significantly reduce data sharing.

Revenue decreased by $6,685,179 or approximately 8% to $72,218,996 for the year ended December 31, 2023 from $78,904,175 in the prior year.

Our decrease in revenues is attributed to two major factors.

First, one of our largest customers implemented a sales platform change affecting the customers’ ability to find and purchase the IVFH products they were used to purchasing.

Second, as a result of executing phase one of our outlined three phased strategy, a conscious decision was made to scale back our direct-to-consumer eCommerce businesses which included a reduction of dedicated resources and marketing spend required to support such revenues.

We continue to assess the potential of new revenue sources from the manufacture and sale of proprietary food products, private label products and additional sales channel opportunities in both the foodservice and consumer space and will implement a strategy which based on our analysis provides the most beneficial opportunity for growth.

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Cost of goods sold

Our cost of goods sold for the year ended December 31, 2022 was $61,414,765, an increase of $16,153,364 or approximately 36% compared to cost of goods sold of $45,261,401 for the year ended December 31, 2021.

Our cost of goods sold for the year ended December 31, 2023 was $54,693,359, a decrease of $6,684,025 or approximately 11% compared to cost of goods sold of $61,377,384 for the year ended December 31, 2022.

Cost of goods sold was made up of the following expenses for the year ended December 31, 2023:

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and cost of goods associated with logistics of $585,723.

Gross margins as a percentage of sales declined during the current period to 23.3% compared to 27.2% during the comparable period, primarily due to variation in product and revenue mix across our various selling channels, increases in fuel costs and fuel surcharges associated with the higher cost of fuel in the United States and higher shipping costs contributed to the decline in gross margins as a percentage of sales.

In 2022, we continued to price our products in order to increase sales, gain market share and increase the number of our end users and customers.

Gross margins as a percentage of sales improved during the current period to 24.3% compared to 22.2% during the comparable period, as we continued implementing improved cost controls, better managed pricing, and focused more on product mix.

In 2024, we will continue to price our products in order to increase sales, gain market share and increase the number of our end users and customers.

We currently expect, if market conditions, overall economic conditions, and our product revenue mix remain constant, that our cost of goods sold may increase and may result in a decrease in profit margin.

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Selling, general, and administrative expenses decreased by $943,152 or approximately 5% to $17,389,351 during the year ended December 31, 2023 compared to $18,332,503 for the year ended December 31, 2022.

The decrease in selling, general, and administrative expenses was primarily due to a decrease in advertising and digital marketing costs in the amount of $499,610, a decrease in payroll and related costs in the amount of $424,308, including a decrease of $91,287 in non-cash compensation;

The decrease in selling, general, and administrative expenses was primarily due to a decrease in advertising and digital marketing costs in the amount of $1,157,945;

a decrease in office, facilities, and vehicles cost of $461,559;

a decrease in computer and IT costs of $101,761;

and a decrease in banking and credit card fees of $80,665.

Other components of the decrease in selling, general, and administrative expenses include a decrease in bad debt expense in the amount of $33,671 and taxes in the amount of $7,589.

These decreases were partially offset by an increase in travel and entertainment costs of $105,297, an increase in office & facilities costs of $73,457, an increase in computer and IT expense of $52,115, an increase in professional fees of $47,371, an increase in amortization and depreciation of $36,344, and an increase in insurance costs of $23,263.

These decreases were partially offset by an increase in payroll and related costs in the amount of $618,090, including an increase of $83,545 in non-cash compensation;

an increase in insurance costs of $90,369;

an increase in bad debt expense of $75,211;

an increase in taxes of $43,333;

and an increase in professional and legal fees of $42,253.

The decrease in sales, general, and administrative expenses represent the results of our overall cost-cutting efforts as well as the restructuring of our marketing and advertising programs.

Impairment of Investment

During the year ended December 31, 2022, we made the determination that our investments in seven food-related companies were unlikely to be recovered, and we recorded an impairment on these investments in the aggregate amount of $286,725.

During the year ended December 31, 2021, the founder of one of the food related companies passed away in an untimely tragic accident, and as a result the food related company ceased operations and the Company recognized an impairment in the amount of $209,850 in connection with that investment.

There was no such comparable transaction in the current period.

Separation costs – executive officers

During the year ended December 31, 2023, the Company entered into the following separation agreements:

(i) a separation agreement with its Prior CEO and current board member with a total cost of $1,819,199 consisting of cash payments of $250,000, a non-interest bearing note payable to Mr.

Klepfish in the amount of $1,000,000, $1,199 of Cobra health insurance payments, and stock grants with a value of $568,000;

(ii) a separation agreement with its prior Director of Strategic Acquisitions and prior board member with a total cost of $126,451 consisting of cash payments of $100,000 and $26,451 of Cobra health insurance payments;

(iii) a separation agreement with its prior CFO with a total cost of $128,413 consisting of cash payments of $113,918 and $14,495 of Cobra health insurance payments.

The aggregate separation costs for the year ended December 31, 2023 was $2,074,063;

there were no such costs during the prior year.

Impairment of intangible assets

During the year ended December 31, 2023, the Company recorded an impairment of intangible assets in the amount of $1,315,822 consisting of impairment charges in the amount of $1,055,400 and $260,422 against the tradenames held by igourmet and Mouth, respectively.

Due to our strategic decision to allocate fewer resources to our direct-to-consumer business, the determination was made that the cost of these assets was unlikely to be recovered.

Interest expense, net

Interest expense, net of interest income, increased by $289,167 or approximately 49% to $876,452 during the year ended December 31, 2023, compared to $587,285 during the year ended December 31, 2022.

The increase was due primarily to an increase in interest accrued or paid on the Company’s commercial loans and notes payable in the amount of $404,186 due to higher interest rates and higher loan balances.

The increase in interest expense was partially offset by a decrease in the amortization of loan fees in the amount of $112,463, from $115,760 in the prior year to $3,297 during the current year.

In addition, interest income increased by $2,556, from $6,480 in the prior year to $9,036 in the current year.

Loss on sale of subsidiaries

On December 29, 2023, the Company sold 100% of their equity interests in Organic Food Brokers, LLC and Oasis Sales Corp.

to a single buyer for a purchase price of $75,000.

The Company recorded a loss in the amount of $45,022 on this transaction.

There were no comparable transactions in the prior year.

During the year ended December 31, 2023, the Company recognized other income in the amount of $14,925 from the sale of a subscription based D2C revenue stream.

During the year ended December 31, 2022, the Company recognized other income in the amount of $294,000 in connection with the termination of the interest rate swap.

There was no comparable transaction in the prior period.

Gain on forgiveness of debt

During the year ended December 31, 2021, the Company recorded a gain on forgiveness of debt in connection with the IVFH PPP Loans in the amount of $3,425,015, consisting of $3,398,635 of principal and $26,380 of accrued interest.

There was no comparable transaction in the current period.

Gain on sales of assets

During the year ended December 31, 2023, the Company recognized a gain in the amount of $9,360 in connection with the sale of a vehicle.

There was no comparable transaction in the prior year.

Other leasing income

During the year ended December 31, 2023, the Company recognized income in the amount of $7,600 in connection with the lease of space in our Mountaintop warehouse facility, a decrease of $3,626 or approximately 32% compared to $11,226 during the year ended December 31, 2022.

Gain on contingent liabilities

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accordingly, the Company has reversed these liabilities.

There were no comparable transactions in the current year.

Impairment of Investment

During the year ended December 31, 2022, we made the determination that our investments in seven food-related companies were unlikely to be recovered, and we recorded an impairment on these investments in the aggregate amount of $286,725.

There were no comparable transactions in the current year.

Loss on extinguishment of debt

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We wrote off the existing discounts to the Fifth Third Bank loans in the amount of $40,556 resulting in a loss on extinguishment of debt.

There was no comparable transaction during the year ended December 31, 2021.

Other leasing income

During the year ended December 31, 2022, the Company recognized income in the amount of $11,226 in connection with the lease of space in our Mountaintop warehouse facility, an increase of $386 or approximately 4% compared to $10,840 during the year ended December 31, 2021.

Interest expense, net

Interest expense, net of interest income, increased by $233,299 or approximately 66% to $586,153 during the year ended December 31, 2022, compared to $352,854 during the year ended December 31, 2021.

The increase was due primarily to an increase in interest accrued or paid on the Company’s commercial loans and notes payable in the amount of $165,703 due to higher interest rates and an increase in loan fees in the amount of $103,235 due to loan fees incurred in connection with the MapleMark and Fifth Third loans.

These increases were partially offset by a decrease in the amount of $20,639 in connection with the interest rate swap, and a decrease in $14,852 related to the PPP loans.

For the reasons above, the Company had a net loss for the year ended December 31, 2022 of $1,350,002 compared to a net loss of $716,331 during the year ended December 31, 2021.

There was no comparable transaction during the current year.

Income tax expense

During the year ended December 31, 2023, the Company paid federal income taxes in the amount of $15,834 in connection with an audit of the year ended December 31, 2017.

There was no such charge during the prior period.

Net loss from continuing operations

For the reasons above, the Company had a net loss from continuing operations for the year ended December 31, 2023 of $4,159,022, an increase of $3,039,570 or approximately $271% compared to a net loss from continuing operations of $1,119,452 during the year ended December 31, 2022.

The loss for the year ended December 31, 2023 includes a net total of $2,355,220 in non-cash charges, including charges for non-cash compensation in the amount of $405,503;

depreciation expense of $526,274;

impairment of investments of $286,725;

impairment of intangible assets of $1,315,822;

amortization of prepaid loan fees of $3,297;

amortization of intangible assets in the amount of $30,994;

and loss on extinguishment of debt of $40,556.

These charges were partially offset by a gain on contingent liabilities in the amount of $295,600 and provision for doubtful accounts of $1,915.

The loss for the year ended December 31, 2021 includes a total of $1,551,951 in non-cash charges, including charges for non-cash compensation in the amount of $668,251;

and provision for doubtful accounts of $73,330 The loss for the year ended December 31, 2022 includes a total of $1,580,162 in non-cash charges, including charges for non-cash compensation in the amount of $576,964;

depreciation expense of $520,848;

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amortization of prepaid loan fees of $115,760;

and amortization of intangible assets in the amount of $8,912.

These non-cash losses were offset by a gain on forgiveness of debt in the amount of $3,425,015.

loss on extinguishment of debt of $40,556, and amortization of intangible assets in the amount of $41,224.

Net loss from discontinued operations

During the year ended December 31, 2023, the Company had a net loss from discontinued operations in the amount of $196,130, a decrease in the amount of $34,420 or approximately 15% compared to a net loss from discontinue operations in the amount of $230,550 during the prior year.

Liquidity and Capital Resources at December 31, 2023

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inventory of $2,973,134;

and other current assets of $289,432.

Also at December 31, 2022, the Company had current liabilities of $16,412,609, consisting of trade payables and accrued liabilities of $6,853,253, accrued interest of $18,104, deferred revenue of $1,558,155, line of credit of $2,014,333, current portion of notes payable of $5,711,800, current portion of operating lease liability of $64,987, and current portion of financing lease liability of $191,977.

other current assets of $287,528;

assets held for sale of $649,884, and current assets of discontinued operations of $95,861.

Also at December 31, 2023, the Company had current liabilities of $8,640,993, consisting of trade payables and accrued liabilities of $6,252,951;

accrued separation costs, related parties of $463,911;

accrued interest of $95,942, deferred revenue of $1,312,837, stock appreciation rights liability of $255,020;

current portion of notes payable of $121,041, current portion of operating lease liability of $17,131, current portion of financing lease liability of $115,738;

and current liabilities of discontinued operations of $6,422.

During the year ended December 31, 2023, the Company had cash used in operating activities of $435,562.

Cash flow used in operations consisted of the Company’s consolidated net loss of $1,350,002 less depreciation and amortization of $562,072, stock-based compensation in the amount of $576,964, impairment of investment of $286,725, amortization of right-of-use assets of $66,740, and amortization of prepaid loan fees in the amount of $115,760, and loss on extinguishment of debt of $40,556.

These amounts were partially offset by a gain on contingent liabilities in the amount of $295,600 and recoveries of doubtful accounts of $1,915.

The Company’s cash position decreased by $600,386 as a result of changes in the components of current assets and current liabilities.

The Company had cash used in investing activities of $114,966 for the year ended December 31, 2022, which consisted of cash paid for the acquisition of property and equipment.

The Company had cash used in financing activities of $509,221 for the year ended December 31, 2022, which consisted of principal payments on loans and notes payable in the amount of $172,422;

principal payments on financing leases in the amount of $176,494;

cost of debt financing of $110,305;

and payment of offering costs for stock previously accrued of $50,000.

The Company had a net working capital deficit of $3,200,532 as of December 31, 2022.

Cash flow used in operations consisted of the Company’s consolidated net loss of $4,355,152 less impairment of intangible assets of $1,315,822;

depreciation and amortization of $557,268;

stock-based compensation in the amount of $405,503;

value of stock appreciation rights of $255,020;

provision for inventory of $189,582;

provision for doubtful accounts of $73,330;

amortization of right of use asset of $51,756;

loss on sale of subsidiaries of $45,022;

amortization of discount on notes payable of $3,297;

and gain on the disposition of assets of $(9,360).

In addition, the Company’s cash position increased by $1,032,350 as a result of changes in the components of current assets and current liabilities.

The Company had cash used in investing activities of $36,332 for the year ended December 31, 2023, which consisted of cash paid for the acquisition of property and equipment in the amount of $122,403, partially offset by cash received from the sale of subsidiaries of $75,000 and cash received from the sale of assets of $11,071.

The Company had cash provided by financing activities of $994,831 for the year ended December 31, 2023, which consisted of cash received from notes payable, net in the amount of $3,285,588;

partially offset by principal payments on the line of credit in the amount of $2,014,333;

principal payments on debt of $187,611;

and principal payments on financing leases of $88,813.

The Company had net working capital of $5,000,156 as of December 31, 2023.

The Company had cash used in operating activities during the year ended December 31, 2023 in the amount of $435,562, compared to $599,086 during the year ended December 31, 2022.

The Company intends to continue to focus on increasing market share and cash flow from operations by focusing its sales activities on specific market segments and new product lines and improving operating efficiencies.

Currently, we do not have any material long-term obligations other than those described in Notes 11, 12 and 13 to the financial statements included in this report.

Currently, we do not have any material long-term obligations other than those described in Note 14 to the financial statements included in this report.

As we seek to increase our sales of new items and enter new markets, acquire new businesses as well as identify new food oriented products and services, we may use existing cash reserves, long-term financing, or other means to finance such diversification, although no assurance can be given that such growth will occur.

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As we seek to increase our sales of new items and enter new markets, acquire new businesses as well as identify new and other consumer and food service oriented products and services, we may use existing cash reserves, long-term financing, or other means to finance such diversification.

If the Company’s cash flow from operations is insufficient to fully implement its business plan, the Company may require additional financing in order to execute its operating plan.

If the Company’s cash flow from operations is insufficient to fully implement its business plan disclosed below, the Company may require additional financing in order to execute its operating plan.

The Company cannot predict whether this additional financing will be in the form of equity or debt, or be in another form.

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In any of these events, the Company may be unable to implement its current plans for expansion, repay its debt obligations as they become due or respond to competitive pressures, any of which circumstances would have a material adverse effect on its business, prospects, financial condition and results of operations.

The world has been in the grip of a pandemic since March 2020 which has wreaked havoc on economies world-wide, including in the U.S., which is our primary market.

As a result of the pandemic, restaurants, hotels, country clubs, casinos, catering houses and other segments of our primary customer base were either closed completely or have only opened with significantly reduced operations.

Accordingly, foodservice revenues, which historically have been a significant portion of our overall revenues had been significantly reduced as most foodservice establishments cross the United States closed or had limited operations.

As a result, foodservice revenue commencing in the second half of March 2020 and through the end of 2021 experienced unprecedented declines.

In 2022, as the pandemic began to recede and foodservice establishments reopened and travel resumed, we have experienced strong foodservice revenue growth.

Concurrently, while ecommerce revenues remained above pre-pandemic historical levels, lower deferred revenues recognized in the twelve months of 2022 and decreases in COVID-19 driven demand in 2022 compared to 2021 (partially driven by the continued re-opening of bricks and mortar stores), and an increasingly challenging digital marketing environment fueled by industry-wide marketing challenges, including expanded privacy rules that significantly reduce data sharing.

During 2023, as Mr.

Bennett has now recently taken the role of CEO, we will be doing a holistic review of the Company’s portfolio of businesses and go to market strategies.

In the meantime, we plan to continue to expand our business by expanding our focus on additional specialty foods markets and by leveraging our e-commerce platform to launch and grow new D2C brands and e-commerce sites within targeted consumer areas either organically and/or through acquisition of new D2C brands and e-commerce sites within targeted consumer areas.

In addition, we will continue exploring potential acquisition and partnership opportunities with influencers and other celebrities to continue to extend our focus in the specialty food market through the growth of the Company’s existing sales channels and through a variety of additional potential sales channel relationships.

Additionally, to further optimize the Company’s return on marketing spend, the company has meaningfully reduced its digital marketing spend in traditional digital marketing channels and has shifted focus to increasing our strategic loyalty and retention focused customer experience improvements across our branded online retailers.

Additional focus includes further improving the customer experience on our existing food subscription offerings, expanding our traditional monthly subscription offerings and launching a “subscribe and save” subscription offering.

In addition, we are currently exploring the introduction of, or have introduced into the market, a variety of new product categories and new product lines, including private label products and proprietary branded products to leverage our existing foodservice and consumer customer base.

Furthermore, the Company intends to continue to expand its activities in the direct-to-consumer space and the overall consumer packaged goods (CPG) space by leveraging its overall capabilities in the consumer space, including leveraging its direct to consumer e-commerce platform to reach both additional customers in multiple channels, and to expand availability of its e-commerce capabilities to additional products and markets.

The Company also plans on expanding its B2B offerings, including of its managed services which provide a complete customer backend experience solution for small to large brands by leveraging the platform's procurement, logistics and fulfillment capabilities.

The Company also manages monthly subscription offerings on behalf of third party B2B clients and the Company plans on expanding this offering in 2023.

In addition, the Company is focused on formally launching its B2B managed marketplace offerings, currently in beta testing, in which the Company offers its B2B customers a complete managed solution including warehousing fulfillment and listing management, for third party marketplace for marketplaces such as Amazon, Walmart and other third party marketplaces.

No assurances can be given that any of these plans will come to fruition or that if implemented that they will necessarily yield positive results.

As discussed in our earnings calls and press releases over the past year, we are dividing our journey into three distinct phases:

1) Stabilization, 2) Laying the Foundation for Growth, and 3) Build and Scale.

Our first phase is focused on the stabilization of our business.

We need to build a track record of consistently delivering a profitable business model and positive cash flow.

This is why we’ve been focused so heavily on right sizing our margins, expenses, and uses of cash.

During this phase we have been clear that we expected revenues to decline as we worked through some revenue headwinds at one key customer, and exited unprofitable or non-core businesses, helping us focus the business on the core, profitable Professional Chef business.

We expect to return to revenue growth by the back half of 2024 as we complete the stabilization phase.

We’re calling our second phase “Laying the Foundation for Growth,” which will entail considering making several strategic investments to build a next generation business model.

Our goal will be to design a best-in-class value proposition that serves our customers in a differentiated way, and transparently demonstrates the profitable business model we expect to build.

We anticipate this phase will last 12-18 months.

Our growth focus during this phase falls into three buckets:

1) growing our business with existing customers with a more structured sales team with appropriate incentives, expanding our assortment of products with a much higher focus on fresh categories, and working to lower prices through improved sourcing and negotiation tactics;

2) establishing relationships with new customers to prove out the broader appeal of our value proposition, and de-risk our customer concentration;

and 3) launching or buying entirely new sales channels which serve incremental customers and market share opportunities.

Then we’ll move to phase three, which we’re calling:

“Build and Scale.” By this point, we will have a clear view of where we’re headed, and the outsized benefits of getting there.

This measured approach to growth will ensure we only scale business models we can prove will drive accretive growth for the company.

As we move through these three phases, we believe that there are lateral opportunities in the food industry and related markets.

We may consider the possibility of acquiring specialty food manufacturers, specialty food distributors, or specialty food brands.

We anticipate that any acquisition could potentially involve the issuance of additional shares of our common stock or third party financing, which may not be available on acceptable terms.

No acquisition will be consummated without thorough due diligence.

No assurance can be given that we will be able to identify and successfully conclude negotiations with any potential target.

Off-Balance Sheet Arrangements

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Effective January 1, 2018 the Agreement was further amended to remove the cap on renewals, and provide for an unlimited number of additional 12-month terms unless either party notifies the other in writing, 30 days prior to the end date, of its intent not to renew.

In addition, during the year ended December 31, 2023 and 2022, sales to Gate Gourmet accounted for approximately 15% and 13% of total sales, respectively.

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.