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Item 1A. Risk Factors

2025-03-20 compared with 2024-03-21 · 552 added, 218 removed, 21 unchanged (97% of the section changed)

We face risks related to health epidemics and other widespread outbreaks of contagious disease, which could significantly disrupt our sales and supply chain and impact our operating results.

Significant outbreaks of contagious diseases, and other adverse public health developments, could have a material impact on our business operations and operating results.

In December 2019, a strain of novel coronavirus (COVID-19) causing respiratory illness and death emerged in the city of Wuhan in the Hubei province of China.

The coronavirus was declared a global pandemic by the World Health Organization and spread throughout the world, including the United States, resulting in emergency measures such as travel bans, closure of retail stores, and restrictions on gatherings of more than a maximum number of people.

Included in these emergency measures is the mandated full or partial closure of restaurants and other foodservice establishments across the United States.

These foodservice establishments represent a significant portion of our revenues and their continued closure and/or operation with capacity limits would likely continue to have a detrimental effect on our business.

We believe the risks associated with COVID-19 have significantly diminished during the year ended December 31, 2023.

However, the risk of future contagious disease outbreaks remains a significant risk factor for us which could result in economic turmoil.

Should a recession occur, either as a result of a pandemic, lack of stability, armed conflicts in various countries or for any other reason, we can expect that our sales, net income and cash flows will be negatively impacted.

We Have a History of Losses Requiring Us to Seek Additional Sources of Capital.

As of December 31, 2023, we had an accumulated deficit of $38,821,278.

We cannot assure you that we can achieve profitability on a quarterly or annual basis in the future.

If revenues grow more slowly than we anticipate, or if operating expenses exceed our expectations or cannot be adjusted accordingly, or other extraordinary events occur, we will incur losses.

Our possible success is dependent upon the successful development and marketing of our services and products, as well as continued expansion of our products and customers, as to which we can give no assurance.

Any future success that we might enjoy will depend upon many factors, including factors out of our control or which cannot be predicted at this time.

These factors may include changes in or increased levels of competition, including the entry of additional competitors and increased success by existing competitors, changes in general economic conditions, increases in operating costs, including costs of supplies, personnel, marketing and promotions, reduced margins caused by competitive pressures and other economic and non-economic factors.

Relating to Our Business and Industry

We have a history of losses requiring us to

seek additional sources of capital.

of December 31, 2024, we had an accumulated deficit of $36,209,764.

We cannot assure you that we can achieve profitability on a quarterly

or annual basis in the future.

If revenues grow more slowly than we anticipate, or if operating expenses exceed our expectations or cannot

be adjusted accordingly, or other extraordinary events occur, we will incur losses.

Our potential success is contingent upon the effective

development and commercialization of our services and products, as well as the continued expansion of our product portfolio and customer

base, for which we can provide no assurance.

Any future success we may achieve will be influenced by numerous factors, including those

beyond our control or presently unforeseeable.

These factors may include changes in or increased levels of competition, including the

entry of additional competitors and increased success by existing competitors, changes in general economic conditions, increases in operating

costs, including costs of supplies, personnel, marketing and promotions, reduced margins caused by competitive pressures, taxes, and

other economic and non-economic factors.

These conditions may have a materially adverse effect upon us or may force us to curtail operations.

In addition, we could require additional funds to sustain and expand our sales and marketing activities, particularly if a well-financed competitor emerges.

In addition, we could require additional funds to sustain and expand our sales and marketing activities, particularly if a well-financed

competitor emerges.

We can give no assurance that financing will be available in amounts or on terms acceptable to us, if at all.

Our inability in such instance to obtain sufficient funds from our operations or external sources could require us to curtail operations.

We Have Historically Derived Substantially Most of Our Revenue From One Client and if We Were to Lose Such Client and Be Unable to Generate New Sales to Offset Such Loss, We May Be Forced to Cease or Curtail Our Operations.

In 2003, Next Day Gourmet initially contracted with our subsidiary, Food Innovations, to handle the distribution of over 3,000 perishable and specialty food products to customers of USF.

Effective January 1, 2018, we executed a contract amendment between Food Innovations, Inc., our wholly owned subsidiary, and U.S.

Foods which provides for no limit on automatic annual renewals thereafter if no party gives the other 30 days’ notice of its intent not to renew.

Our sales through USF’s sales force generated gross revenues for us of $34,070,052 in the year ended December 31, 2023, and $39,531,207 in the year ended December 31, 2022.

Those amounts contributed 47% and 49% of our total sales for each of 2023 and 2022, respectively.

Our sales efforts within specialty foodservice are for the most part substantially dependent upon the efforts of the USF sales force.

Although we have generated revenues from additional customers other than USF, if our relationship with USF were to be materially changed and we are unable to generate substantial new sales to offset such loss, we may be forced to significantly curtail our operations.

A Variety of Factors, Including Seasonality and the Economic Environment, May Cause Our Quarterly Operating Results to Fluctuate, Leading to Volatility in Our Stock Price.

Our quarterly results have fluctuated in the past and may fluctuate in the future, depending upon a variety of factors, including changes in economic conditions, including both COVID-19 related and non-related conditions, and shifts in the timing of holiday related purchases.

While our annual sales have always had a significant seasonal aspect, this has increased with our acquisition of substantially all of the assets of igourmet LLC and Mouth Foods, Inc, as further described below.

As a result of the seasonal nature of our business, we would be significantly and adversely affected, in a manner disproportionate to the impact on a company with sales spread more evenly throughout the year, by unforeseen events such as a terrorist attack or economic shock (including shock caused by world-wide pandemic or otherwise) that harm the retail environment or consumer buying patterns during our key selling season, or by events such as pandemic, strikes or weather related delays that interfere with the shipment of goods, during the critical period of the holiday season.

The Loss of Availability of our Bank Loans Could Adversely Impact our Business and Financial Condition.

We currently have multiple loans with MapleMark Bank.

All of these contain cross-default provisions which means that all outstanding borrowings can be accelerated and can become immediately due and payable in the event of a default in any of such loans, which includes, among other things, failure to comply with certain financial covenants or breach of representations contained in the loan documents, defaults under other loans or obligations or involvement in bankruptcy proceedings (as such terms are defined in the loan documents).

We are also subject to negative covenants which, during the life of the loans, prohibit and/or limit us from, among other things, incurring certain types of other debt, acquiring other companies, making certain expenditures or investments, and changing the character of our business.

Any material change to the business and economic landscape negatively impacting our business, including among other things, an outbreak of infectious disease, a pandemic or a similar public health threat, such as the COVID-19 outbreak, or bank failures, inflation, recession, or other significant economic turmoil, could adversely impact our ability to comply with such covenants.

Our failure to comply with such covenants or any other breach of the loan documents could cause a default and we may then be required to repay all of such borrowings with capital from other sources.

Under these circumstances, other sources of capital may not be available or may be available only on unfavorable terms.

In the event of a default, it is possible that our assets and certain of our subsidiaries’ assets may be attached or seized by the lenders.

Any (i) failure by us to comply with the covenants or other provisions of the loan documents, (ii) difficulty in securing any required future financing, or (iii) any such seizure or attachment of assets could have a material adverse effect on our business and financial condition.

The Acquisition of Substantially All of the Assets of igourmet LLC and Mouth Foods, Inc.

Could Create Additional Risks to Our Business.

On January 23, 2018, our subsidiary, Innovative Gourmet LLC, acquired substantially all of the assets of igourmet, LLC.

On July 6, 2018, our subsidiary, M Innovations LLC, acquired substantially all of assets of Mouth Foods, Inc.

These businesses are very seasonal in nature, which generates certain operational considerations and could exacerbate the seasonality of our business.

To wit, if igourmet or Mouth does not have a strong holiday season, it likely will not be successful.

In addition, while our subsidiary acquired only certain discrete liabilities of igourmet LLC, creditors of igourmet or Mouth may seek to impose liability on us or our subsidiaries, the payment of which, if required, could impair our cash flow and even if there may be no actual liability or responsibility to pay such claims, our challenge to such claims could involve significant legal fees and be a distraction to our management.

The business model of the assets acquired from igourmet LLC and Mouth differ from our other businesses and operations, and therefore the success of its operations and its business model may create unforeseen complications requiring the use of our limited resources to resolve.

Computer System Disruption and Cyber Security Attacks or a Data Breach Could Damage Our Relationships With Our Customers, Harm Our Reputation, Expose Us To Litigation And Adversely Affect Our Business.

Our systems are subject to damage or interruption from computer viruses, malicious attacks and other security breaches.

The possibility of a cyberattack on any one or all of these systems is a serious threat.

As part of our business model, we collect, retain, and transmit confidential information over public networks.

In addition to our own databases, we use third party service providers to store, process and transmit this information on our behalf.

Although we contractually require these service providers to implement and use reasonable security measures, we cannot control third parties and cannot guarantee that a security breach will not occur in the future either at their location or within their systems.

We have confidential security measures in place to protect both our physical facilities and digital systems from attacks.

Despite these efforts, we may be vulnerable to targeted or random security breaches, acts of vandalism, computer viruses, misplaced or lost data, programming and/or human errors, or other similar events.

Given the growing nature of our e-commerce presence and digital strategy, it is imperative that we and our partners maintain uninterrupted and secure operation of our:

(i) computer hardware, (ii) software systems, (iii) customer marketing databases and other customer information, and (iv) ability to email our current and potential customers.

If our systems are damaged or fail to function properly or reliably, we may incur substantial repair or replacement costs, experience data loss or theft and impediments to our ability to conduct our operations.

Any material disruptions in our e-commerce presence or information technology systems could have a material adverse effect on our business, financial condition and results of operations.

A Failure to Establish and Maintain Strategic Online and Social Media Relationships, and Other Relationships Targeted Towards Driving Web Traffic to our Websites, that Generate a Significant Amount of Traffic Could Limit the Growth of the Assets Acquired from igourmet LLC and Mouth Foods Inc.

We rely on third party websites, search engines and affiliates with which we have strategic relationships for traffic.

If these third parties do not attract a significant number of visitors, we may not receive a significant number of online customers from these relationships and our revenues from these relationships may remain flat or decrease.

There continues to be strong competition to establish or maintain relationships with leading Internet companies, and we may not successfully enter into additional relationships, or renew existing ones beyond their current terms.

We may also be required to pay significant fees to maintain and expand existing relationships or possibly not achieve the desired results with existing relationships.

Our online revenues may suffer if we do not enter into new relationships or maintain existing relationships or if these relationships do not result in traffic sufficient to justify their costs.

If a Significant Number of Customers are not Satisfied with their Purchase, We will be Required to Incur Substantial Costs to Issue Refunds, Credits or Replacement Products.

If customers are not satisfied with the products they receive, we may either replace the product for the customer or issue the customer a refund or credit.

Ours net income would decrease if a significant number of customers request replacement products, refunds or credits and we are unable to pass such costs onto the supplier.

If We Fail to Continuously Improve Our Website, it May Not Attract or Retain Customers.

If potential or existing customers do not find our websites including www.igourmet.com, www.mouth.com or any of the company’s other websites, a convenient place to shop, we may not attract or retain customers and our sales may suffer.

To encourage the use of our website, we must continuously improve its accessibility, mobile capabilities, content and ease of use.

In addition, customer traffic and our business would be adversely affected if competitors’ websites are perceived as easier to use or better able to satisfy customer needs.

Furthermore, e-commerce conversion rates could be adversely affected by a variety of website related factors.

Our Marketing Efforts to Help Grow Our Business May Not be Effective.

Maintaining and promoting awareness of our websites, including www.igourmet.com and www.mouth.com , is important to our ability to attract and retain visitors.

Generating a meaningful return on our investments in marketing initiatives may be difficult.

The marketing efforts we implement may not succeed for a variety of reasons, including our inability to execute and implement our plans.

External factors beyond our control may also impact the success of our marketing initiatives.

Search engines frequently change the algorithms that determine the ranking and display of results of a user’s search and may make other changes to the way results are displayed, which can negatively affect the placement of links to our websites and, therefore, reduce the number of visits to our websites.

The growing use of online ad-blocking software, including on mobile devices, may also impact the success of our marketing efforts because we may reach a smaller audience and fail to bring more visitors to our websites.

In addition, ongoing privacy regulatory changes may impact the scope and effectiveness of marketing and advertising services generally, including those used related to our websites.

We also seek to obtain website visitors through email.

If we are unable to successfully deliver emails to potential customers or customers do not open our emails, whether by choice or because those emails are marked as low priority or spam, or for other reasons, our business could be adversely affected.

inability in such instance to obtain sufficient funds from our operations or external sources could require us to curtail operations.

We rely on a few key customers for most of our revenue and if we were

to lose one or more of those clients and be unable to generate new sales to offset such loss, we may be forced to cease or curtail our

2003, Next Day Gourmet initially contracted with our subsidiary, Food Innovations, Inc.

(“Food Innovations”), to handle the

distribution of over 3,000 perishable and specialty food products to customers of USF.

Effective January 1, 2018, we executed a contract

amendment between Food Innovations, our wholly owned subsidiary, and USF which provides for no limit on automatic annual renewals

thereafter if no party gives the other 30 days’ notice of its intent not to renew.

Our sales through USF generated gross revenues

for us of $31,185,864 in the year ended December 31, 2024, and $34,070,052 in the year ended December 31, 2023.

Those amounts contributed

43% and 48% of our total sales for each of 2024 and 2023, respectively.

Other significant customers include Gate Gourmet and Sam’s

During the years ended December 31, 2024 and 2023, sales to Gate Gourmet amounted to $11,574,069, or 16% of total sales, and $10,742,556,

or 15% of total sales, respectively.

During the years ended December 31, 2024 and 2023, sales to Sam’s Club amounted to $5,520,214,

or 8% of total sales, and $0, respectively.

Our sales efforts within specialty foodservice are for the most part substantially dependent

upon the efforts of the USF sales force.

Although we have generated revenues from customers other than USF, if our relationship with

USF were to be materially changed and we may not be able to secure alternative revenue streams to mitigate the impact of such a loss,

which may result in us significantly curtailing our operations.

A variety of factors, including seasonality

and the economic environment, may cause our operating results to fluctuate, leading to volatility in our stock price.

Our operational results have fluctuated in the past

and may fluctuate in the future, depending upon a variety of factors, including changes in economic conditions, and shifts in the timing

of holiday related purchases.

Although our annual sales have historically had a significant seasonal aspect, this has become less pronounced

following the divestment of the assets of igourmet.com and M Innovations LLC (“Mouth”).

However, we have expanded our distribution

of specialty cheeses, which are more seasonally relevant during the fourth quarter.

Due to the seasonal nature of this business, we would

be significantly and disproportionately affected by unforeseen events such as terrorist attacks or economic shocks (including those caused

by worldwide pandemics or other factors) that negatively impact the retail environment or consumer buying patterns during our key selling

Additionally, events such as pandemics, strikes, or weather-related delays that interfere with the shipment of goods during the

critical holiday season would adversely affect us.

system disruption and cyber security attacks or a data breach could damage our relationships with our customers, harm our reputation,

expose us to litigation and adversely affect our business.

systems are subject to damage or interruption from computer viruses, malicious attacks and other security breaches.

The possibility of

a cyberattack on any one or all of these systems is a serious threat.

part of our business model, we collect, retain, and transmit confidential information over public networks.

In addition to our own databases,

we use third party service providers to store, process and transmit this information on our behalf.

Although we contractually require

these service providers to implement and use reasonable security measures, we cannot control third parties and cannot guarantee that

a security breach will not occur in the future either at their location or within their systems.

We have confidential security measures

in place to protect both our physical facilities and digital systems from attacks.

Despite these efforts, we may be vulnerable to targeted

or random security breaches, acts of vandalism, computer viruses, misplaced or lost data, programming and/or human errors, or other similar

the growing nature of our e-commerce presence and digital strategy, it is imperative that we and our partners maintain uninterrupted

and secure operation of our:

(i) computer hardware, (ii) software systems, (iii) customer marketing databases and other customer information,

and (iv) ability to email our current and potential customers.

our systems are damaged or fail to function properly or reliably, we may incur substantial repair or replacement costs, experience data

loss or theft and impediments to our ability to conduct our operations.

Any material disruptions in our e-commerce presence or information

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

we fail to continuously improve our website, it may not attract or retain customers.

potential or existing customers do not find our websites, a convenient place to shop, we may not attract or retain customers and our

sales may suffer.

To encourage the use of our website, we must continuously improve its accessibility, mobile capabilities, content and

In addition, customer traffic and our business would be adversely affected if competitors’ websites are perceived

as easier to use or better able to satisfy customer needs.

Furthermore, e-commerce conversion rates could be adversely affected by a

variety of website related factors.

marketing efforts to help grow our business may not be effective.

and promoting awareness of our websites is important to our ability to attract and retain visitors.

Generating a meaningful return on

our investments in marketing initiatives may be difficult.

The marketing efforts we implement may not succeed for a variety of reasons,

including our inability to execute and implement our plans.

External factors beyond our control may also impact the success of our marketing

Search engines frequently change the algorithms that determine the ranking and display of results of a user’s search

and may make other changes to the way results are displayed, which can negatively affect the placement of links to our websites and,

therefore, reduce the number of visits to our websites.

growing use of online ad-blocking software, including on mobile devices, may also impact the success of our marketing efforts because

we may reach a smaller audience and fail to bring more visitors to our websites.

In addition, ongoing privacy regulatory changes may

impact the scope and effectiveness of marketing and advertising services generally, including those used related to our websites.

also seek to obtain website visitors through email.

If we are unable to successfully deliver emails to potential customers or customers

do not open our emails, whether by choice or because those emails are marked as low priority or spam, or for other reasons, our business

could be adversely affected.

Social networking websites, such as Facebook and others are another source of visits to our websites.

As ecommerce and social networking evolve, we must continue to evolve our marketing tactics accordingly and, if we are unable to do so, our business could be adversely affected.

If We Do Not Accurately Predict Customer Demand for Our Products, We May Lose Customers or Experience Increased Costs.

As we expand the volume of products offered to our customers, we may be required or may elect for business purposes, to increase inventory levels and the number of products maintained in our warehouses.

If we overestimate customer demand for our products, excess inventory and outdated merchandise could accumulate, tying up working capital and potentially resulting in reduced warehouse capacity and inventory losses due to damage, theft and obsolescence.

ecommerce and social networking evolve, we must continue to evolve our marketing tactics accordingly and, if we are unable to do so,

our business could be adversely affected.

we do not accurately predict customer demand for our products, we may lose customers or experience increased costs.

As we expand the volume of products offered to

our customers, we may be required or may elect, for business purposes, to increase inventory levels and the number of products maintained

in our warehouses.

If we overestimate customer demand for our products, excess inventory and outdated merchandise could accumulate, tying

up working capital and potentially resulting in reduced warehouse capacity and inventory losses due to damage, theft and obsolescence.

If we underestimate customer demand, it may disappoint customers who may turn to our competitors.

The Laws with Respect to Taxes Have Changed and May Change Again Which Could Impact Our Operating Results.

Congress has enacted legislation that significantly reforms the Internal Revenue Code of 1986, as amended.

The new legislation, among other things, includes changes to U.S.

federal tax rates, imposes significant additional limitations on the deductibility of interest and net operating losses, and allows for the expensing of certain capital expenditures.

Our net deferred tax assets and liabilities will be revalued at the newly enacted U.S.

corporate rate, and the impact will be recognized in our tax expense in the year of enactment.

We base our estimates on historical experience and on various other assumptions that are believed to be reasonable in the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources.

Actual results may differ from these estimates under different assumptions or conditions.

It is possible that the application of these new rules may have a material and adverse impact on our operating results, cash flows and financial condition.

Furthermore, the recent Supreme Court Ruling in South Dakota V.

Wayfair, Inc, in which the Court upheld South Dakota’s economic nexus law, which requires companies to collect sales tax when their sales or the number of transactions within the state exceed certain thresholds.

could have an adverse impact on our business.

In addition, any other changes to applicable tax laws, whether on a federal or state level, could also decrease our ability to compete with traditional retailers, and otherwise harm our business.

If We Fail to Attract and Retain Key Personnel, Our Business and Operating Results May be Harmed.

Our future success depends to a significant degree on the skills, experience and efforts of key personnel in our senior management, whose vision for our company, knowledge of our business and expertise would be difficult to replace.

If any one of our key employees leaves, is unable to work, or fails to perform and we are unable to find a qualified replacement, we may be unable to execute our business strategy.

We May Be Unable to Manage Our Growth Which Could Result in Our Being Unable to Maintain Our Operations.

Our strategy for growth is focused on continued enhancements and expansion to our existing business model, offering a broader range of services and products, affiliating with additional vendors and through possible joint ventures.

Unanticipated

changes in effective tax rates or adverse outcomes resulting from examination of our income or other tax returns could adversely affect

our financial condition and results of operations.

are subject to income taxes in the United States, and our domestic tax liabilities are subject to the allocation of expenses in differing

jurisdictions.

Our future effective tax rates could be subject to volatility or adversely affected by a number of factors, including:

in the valuation of our deferred tax assets and liabilities;

timing and amount of the release of any tax valuation allowances;

effects of stock-based compensation;

related to intercompany restructurings;

in tax laws, regulations or interpretations thereof;

than anticipated future earnings in jurisdictions where we have lower statutory tax rates

and higher than anticipated future earnings in jurisdictions where we have higher statutory

Changes in domestic and international trade policies

could materially and adversely affect our business, financial condition, and results of operations.

Any import tariffs may increase the

cost of key food products and ingredients that we rely on, leading to higher production costs and potential supply chain disruptions.

If we are unable to pass these increased costs on to customers through pricing adjustments, our profit margins could be adversely affected.

The evolving trade environment may also create uncertainty in supplier relationships, cause delays in sourcing raw materials, and result

in fluctuating commodity prices, further impacting our operations.

we may be subject to audits of our income, sales and other transaction taxes by federal, state and local authorities.

Outcomes from these

audits could have an adverse effect on our financial condition and results of operations.

we fail to attract and retain key personnel, our business and operating results may be harmed.

future success depends to a significant degree on the skills, experience and efforts of key personnel in our senior management, whose

vision for our company, knowledge of our business and expertise would be difficult to replace.

If any one of our key employees leaves,

is unable to work, or fails to perform and we are unable to find a qualified replacement, we may be unable to execute our business strategy.

may be unable to manage our growth which could result in our being unable to maintain our operations.

strategy for growth is focused on continued enhancements and expansion to our existing business model, offering a broader range of services

and products, affiliating with additional vendors and through possible joint ventures.

Pursuing this strategy presents a variety of challenges.

We may not experience an increase in our services to our existing customers, and we may not be able to achieve the economies of scale, or provide the business, administrative and financial services, required to sustain profitability from servicing our existing and future customer base.

Should we be successful in our expansion efforts, the expansion of our business would place further demands on our management, operational capacity and financial resources.

To a significant extent, our future success will be dependent upon our ability to maintain adequate financial controls and reporting systems to manage a larger operation and to obtain additional capital upon favorable terms.

We can give no assurance that we will be able to successfully implement our planned expansion (whether due to the impact of COVID-19, difficult economic conditions, or other unrelated reasons), finance its growth, or manage the resulting larger operations, if any.

In addition, we can give no assurance that our current systems, procedures or controls will be adequate to support any expansion of our operations.

Our failure to manage our growth effectively could have a material adverse effect on our business, financial condition and results of operations.

The Specialty Food and Foodservice Industry is Very Competitive, Which May Result in Decreased Revenue for Us as Well as Increased Expenses Associated with Marketing Our Services and Products.

The specialty food and foodservice businesses are highly competitive.

We compete against other providers of quality foods, some of which sell their services globally, and some of these providers have considerably greater resources than we have.

These competitors may have greater marketing and sales capacity, established distribution networks, significant goodwill and global name recognition.

Our e-commerce and product catalog websites and paper mailings compete with other e-commerce websites and other catalogs, and other specialty foodservice providers that market lines of products similar to ours.

We compete with national, regional and local businesses utilizing a similar strategy, as well as traditional specialty food and foodservice distributors.

The substantial sales growth in the direct-to-customer industry within the last decade has encouraged the entry of many new competitors, new business models, and an increase in competition from established companies.

We may not experience an increase in our services to our existing customers, and we may not be able to achieve the economies of scale,

or provide the business, administrative and financial services, required to sustain profitability from servicing our existing and future

customer base.

Should we be successful in our expansion efforts, the expansion of our business would place further demands on our management,

operational capacity and financial resources.

To a significant extent, our future success will be dependent upon our ability to maintain

adequate financial controls and reporting systems to manage a larger operation and to obtain additional capital upon favorable terms.

We can give no assurance that we will be able to successfully implement our planned expansion, finance its growth, or manage the resulting

larger operations, if any.

In addition, we can give no assurance that our current systems, procedures or controls will be adequate to

support any expansion of our operations.

Our failure to manage our growth effectively could have a material adverse effect on our business,

financial condition and results of operations.

specialty food and foodservice industry is very competitive, which may result in decreased revenue for us as well as increased expenses

associated with marketing our services and products.

specialty food and foodservice businesses are highly competitive.

We compete against other providers of quality foods, some of which

sell their services globally, and some of these providers have considerably greater resources than we have.

These competitors may have

greater marketing and sales capacity, established distribution networks, significant goodwill and global name recognition.

Our e-commerce

and product catalog websites and paper mailings compete with other e-commerce websites and other catalogs, and other specialty foodservice

providers that market products similar to ours.

We compete with national, regional and local businesses utilizing a similar strategy,

as well as traditional specialty food and foodservice distributors.

The substantial sales growth in the direct-to-customer industry within

the last decade has encouraged the entry of many new competitors, new business models, and an increase in competition from established

Furthermore, it may become necessary for us to reduce our prices in response to competition.

This could negatively impact our ability to be profitable.

We Rely Upon Outside Vendors and Shippers for Our Specialty Food Products and Interruption in the Supply of Our Products or their Failure to Adhere to Our Quality Standards May Negatively Impact Our Revenues.

Shortages in supplies of the food products we sell may impair our ability to provide our services.

Our vendors are independent and we cannot guarantee their future ability to source the products that we sell.

Many of our products are wild-caught, and we cannot guarantee their availability in the future.

Unforeseen strikes and labor disputes as well as adverse weather conditions may result in our inability to deliver our products in a timely manner.

Also, if our suppliers fail to supply quality product in a timely and effective manner it could lead to an increase in recalls and customer litigation against us which could harm our brands’ images and negatively affect our business and operating results.

This could negatively impact

our ability to be profitable.

rely upon outside vendors and shippers for our specialty food products and interruption in the supply of our products or their failure

to adhere to our quality standards may negatively impact our revenues.

in supplies of the food products we sell may impair our ability to provide our services.

Our vendors are independent and we cannot guarantee

their ability to source the products that we sell.

Many of our products are wild-caught, and we cannot guarantee their availability in

Unforeseen strikes and labor disputes as well as adverse weather conditions may result in our inability to deliver our products

in a timely manner.

Also, if our suppliers fail to supply quality product in a timely and effective manner it could lead to an increase

in recalls and customer litigation against us which could harm our brands’ images and negatively affect our business and operating

The success of our business depends, in part, on our ability to timely and effectively deliver merchandise (e.g.

fresh products) to our customers.

We cannot control all of the various factors that might affect our fulfillment rates in direct-to-customer sales.

We are heavily dependent upon one national carrier for the delivery of our fresh products to our customers.

Accordingly, we are subject to risks, including labor disputes, union organizing activity, inclement weather, technology breakdowns, natural disasters, the closure of their offices or a reduction in operational hours due to an economic slowdown or health related crisis, possible acts of terrorism, their ability to provide delivery services to meet our shipping needs, disruptions or increased fuel costs, and costs associated with any regulations to address climate change.

Since our customers rely on us to deliver their orders daily or within 24-72 hours, delivery delays could significantly harm our business.

In Order to be Successful, We Must be able to Enhance Our Existing Products and Develop and Introduce New Products and Services to Respond to Changing Market Demand.

The markets in which we operate are characterized by frequently changing customer demand and the introduction of new “flavors of the month” as certain foods become more and less popular.

Changes in customer preferences and buying trends may also affect our products differently.

We must be able to stay current with preferences and trends in specialty food and address the customer tastes for each of our target customer demographics.

fresh products)

to our customers.

We cannot control all of the various factors that might affect our fulfilment rates in direct-to-customer sales.

are heavily dependent upon one national carrier for the delivery of our fresh products to our customers.

Accordingly, we

are subject to risks, including labor disputes, union organizing activity, inclement weather, technology breakdowns, natural disasters,

the closure of their offices or a reduction in operational hours due to an economic slowdown or health related crisis, possible acts

of terrorism, their ability to provide delivery services to meet our shipping needs, disruptions or increased fuel costs, and costs associated

with any regulations to address climate change.

Since our customers rely on us to deliver their orders daily or within 24-72 hours, delivery

delays could significantly harm our business.

order to be successful, we must be able to enhance our existing products and develop and introduce new products and services to respond

to changing market demand.

markets in which we operate are characterized by frequently changing customer demand and the introduction of new “flavors of the

month” as certain foods become more and less popular.

Changes in customer preferences and buying trends may also affect our products

We must be able to stay current with preferences and trends in specialty food and address the customer tastes for each of

our target customer demographics.

We must also be able to identify and adjust products to cater to customer demands and dietary needs.

For example, a change in customer preferences for gluten free items may not correlate to a similar change in buying trends for other specialty food.

In order to be successful, we must be able to enhance our existing products and anticipate and develop and introduce new products and services to respond to changing market demand for new tastes.

The development and enhancement of services and products entails significant risks, including:

o the inability to effectively adapt new food types to our business;

o the failure to conform our services and products to evolving industry standards;

o the inability to develop, introduce and market enhancements to our existing services and products or new services and products on a timely basis;

o the non-acceptance by the market of such new service and products.

If we misjudge either the market for our products or our customers’ purchasing habits, our sales may decline significantly which would negatively impact our business and operating results.

Any Acquisitions We Make or Have Made Could Result in Difficulties in Successfully Managing Our Business and Consequently Harm Our Financial Condition.

We seek to expand by acquiring complementary businesses or assets in our current or ancillary markets.

We cannot accurately predict the timing, size and success of our acquisition efforts and the associated capital commitments that might be required.

We expect to face competition for acquisition candidates, which may limit the number of acquisition opportunities available to us and may lead to higher acquisition prices.

There can be no assurance that we will be able to identify, acquire or profitably manage additional businesses or successfully integrate acquired businesses, if any, without substantial costs, delays or other operational or financial difficulties.

For example, a change in customer preferences for gluten free items may not correlate to a similar change in buying trends for other

specialty food.

In order to be successful, we must be able to enhance our existing products and anticipate and develop and introduce

new products and services to respond to changing market demand for new tastes.

The development and enhancement of services and products

entails significant risks, including:

inability to effectively adapt new food types to our business;

failure to conform our services and products to evolving industry standards;

inability to develop, introduce and market enhancements to our existing services and products

or new services and products on a timely basis;

non-acceptance by the market of such new service and products.

we misjudge either the market for our products or our customers’ purchasing habits, our sales may decline significantly which would

negatively impact our business and operating results.

acquisitions we make or have made could result in difficulties in successfully managing our business and consequently harm our financial

seek to expand by acquiring complementary businesses or assets in our current or ancillary markets.

We cannot accurately predict the

timing, size and success of our acquisition efforts and the associated capital commitments that might be required.

We expect to face

competition for acquisition candidates, which may limit the number of acquisition opportunities available to us and may lead to higher

acquisition prices.

There can be no assurance that we will be able to identify, acquire or profitably manage additional businesses or

successfully integrate acquired businesses, if any, without substantial costs, delays or other operational or financial difficulties.

In addition, acquisitions involve a number of other risks, including:

failure of the acquired businesses or assets acquired to achieve expected results;

failure to integrate acquired business or assets into current operations

diversion of management’s attention and resources to acquisitions;

failure to retain key customers or personnel of the acquired businesses or assets;

disappointing quality or functionality of acquired equipment and people;

risks associated with unanticipated events, liabilities or contingencies.

Client dissatisfaction or performance problems at a single acquired business could negatively affect our reputation.

The inability to acquire businesses on reasonable terms or successfully integrate and manage acquired companies, or the occurrence of performance problems at acquired companies, both prior and after acquisition, could result, or has resulted, in dilution, potential violations of bank covenants, unfavorable accounting treatment or one-time charges, and difficulties in successfully managing our business, requiring us to expend additional effort and expense in obtaining waivers, settling matters and otherwise addressing any such issues.

Our Future Results Depend on Continued Evolution of the Internet and its Use by Consumers and Businesses for Buying Our Products.

Our future results can depend on the use of the Internet for information, publication, distribution and commerce.

Our growth may also be dependent on increasing availability to business consumers of broadband Internet access which will allow such persons to access higher-capacity content through the Internet.

Our business could suffer if Internet usage and broadband availability does not continue to grow and evolve.

In addition, the concept of ordering food, including ingredients, while it has recently grown, is a relatively new concept and represents a change from the way it had been previously done.

If We are Unable to Effectively Manage Our IT Dependent Business Our Reputation and Operating Results May be Harmed.

The success of our business depends, in part, on third parties and factors over which we have limited control.

We are also vulnerable to certain additional risks and uncertainties associated with our e-commerce and product catalog websites, our internal IT systems and IT integration with our partners, including:

of the acquired businesses or assets acquired to achieve expected results;

to integrate acquired business or assets into current operations

of management’s attention and resources to acquisitions;

to retain key customers or personnel of the acquired businesses or assets;

● disappointing

quality or functionality of acquired equipment and people;

associated with unanticipated events, liabilities or contingencies.

dissatisfaction or performance problems at a single acquired business could negatively affect our reputation.

The inability to acquire

businesses on reasonable terms or successfully integrate and manage acquired companies, or the occurrence of performance problems at

acquired companies, both prior and after acquisition, could result, or has resulted, in dilution, potential violations of bank covenants,

unfavorable accounting treatment or one-time charges, and difficulties in successfully managing our business, requiring us to expend

additional effort and expense in obtaining waivers, settling matters and otherwise addressing any such issues.

we are unable to effectively manage our IT dependent business our reputation and operating results may be harmed.

success of our business depends, in part, on third parties and factors over which we have limited control.

We are also vulnerable to

certain additional risks and uncertainties associated with our e-commerce and product catalog websites, our internal IT systems and IT

integration with our partners, including:

changes in required technology interfaces;

system issues and limitations, website downtime and other technical failures;

system issues and limitations, website downtime

and other technical failures;

internet connectivity issues;

4 unchanged sentences

and consumer privacy concerns.

In addition, we must keep up to date with competitive technology trends, including the use of new or improved technology, creative user interfaces and other e-commerce marketing tools such as paid search and mobile applications, among others, which may increase our costs and which may not succeed in increasing sales or attracting customers.

Our failure to successfully respond to these risks and uncertainties might adversely affect our sales, as well as damage our reputation and brands.

We May be Exposed to Risks and Costs Associated with Credit Card Fraud and Identity Theft that could Cause Us to Incur Unexpected Expenses and Loss of Revenue.

An increasing portion of our customer orders are placed through our e-commerce websites and a significant portion of our orders are submitted via networked applications.

In addition, a significant portion of sales made through our retail channel require the collection of certain customer data, such as credit card information.

In order for our sales channels to function and develop successfully, we and other parties involved in processing customer transactions must be able to transmit confidential information, including credit card information, securely over public networks.

In addition, we must keep up to

date with competitive technology trends, including the use of new or improved technology, creative user interfaces and other e-commerce

marketing tools such as paid search and mobile applications, among others, which may increase our costs and which may not succeed in

increasing sales or attracting customers.

Our failure to successfully respond to these risks and uncertainties might adversely affect

our sales, as well as damage our reputation and brands.

may be exposed to risks and costs associated with credit card fraud and identity theft that could cause us to incur unexpected expenses

and loss of revenue.

increasing portion of our customer orders are placed through our e-commerce websites and a significant portion of our orders are submitted

via networked applications.

In addition, a significant portion of sales made through our retail channel require the collection of certain

customer data, such as credit card information.

In order for our sales channels to function and develop successfully, we and other parties

involved in processing customer transactions must be able to transmit confidential information, including credit card information, securely

over public networks.

Third parties may have the technology or knowledge to breach the security of customer transaction data.

Although we take the security of our systems and the privacy of our customers’ confidential information extremely seriously, we cannot guarantee that our security measures will effectively prevent others from obtaining unauthorized access to our information and our customers’ information.

we take the security of our systems and the privacy of our customers’ confidential information extremely seriously, we cannot guarantee

that our security measures will effectively prevent others from obtaining unauthorized access to our information and our customers’

Any person who circumvents our security measures could destroy or steal valuable information or disrupt our operations.

Any security breach could cause consumers to lose confidence in the security of our websites and choose not to purchase from us.

Any security breach could also expose us to risks of data loss, litigation and liability and could seriously disrupt our operations and harm our reputation, any of which could harm our business.

In addition, states and the federal government are increasingly enacting laws and regulations to protect consumers against identity theft.

Compliance with these laws will likely increase the costs of doing business and, if we fail to implement appropriate safeguards or to detect and provide prompt notice of unauthorized access as required by some of these new laws, we could be subject to potential claims for damages and other remedies, which could harm our results of operations.

Earthquakes, Inclement Weather or Other Events Out of Our Control May Damage or Limit Production from Our Facilities and Our Ability to Timely Deliver Products Thereby Adversely Affecting Our Results of Operations.

We have significant operations in Florida, Illinois, and in other areas where weather or other events such as an earthquake, tsunami, hurricane, flood, fire, high winds, extreme heat or cold, or other natural or manmade events, could disrupt our operations and impair production or distribution of our products, damage inventory, interrupt critical functions, or otherwise affect our business negatively, adversely affecting our results of operations.

Declines in General Economic Conditions and the Resulting Impact on Consumer Confidence and Consumer Spending Could Adversely Impact Our Results of Operations.

Our financial performance is subject to declines in general economic conditions and the impact of such economic conditions on levels of consumer confidence and consumer spending.

Consumer confidence and consumer spending may deteriorate significantly and could remain depressed for an extended period of time, whether due to pandemic, inflation, bank failure, or other unrelated reasons.

Consumer purchases of discretionary items, including specifically our merchandise, generally decline during periods when disposable income is limited, unemployment rates increase, and consumer perceptions of personal well-being and security declines or there is economic uncertainty.

An uncertain economic environment could adversely impact our business and operating results.

We Are and May Be Subject to Regulatory Compliance and Legal Uncertainties.

Changes in government regulation and supervision or proposed Department of Agriculture or other regulatory agency reforms or rule changes could impair our sources of revenue and limit our ability to expand our business.

In the event any future laws or regulations are enacted which apply to us, we may have to expend funds and/or alter our operations to ensure compliance.

New legislation or regulation, or the application of existing laws and regulations to the areas related to our business could add additional costs and risks to doing business.

In addition, we are subject to regulations applicable to businesses generally and laws and regulations directly applicable to communications over the Internet and access to e-commerce.

In addition, it is possible that a number of laws and regulations may be adopted with respect to the Internet and other areas of our business, covering issues such as user privacy, pricing, content, copyrights, distribution, antitrust, taxation and characteristics and quality of products and services.

Since we do Not Intend to Pay Any Cash Dividends on Our Shares of Common Stock, Our Stockholders Will Not be Able to Receive a Return on Their Shares Unless They Sell Them .

We intend to retain any future earnings to finance the development and expansion of our business.

We do not anticipate paying any cash dividends on our common stock in the foreseeable future.

Unless we pay dividends, our stockholders will not be able to receive a return on their shares unless they sell them at a price higher than that which they initially paid for such shares.

We may be Subject to Legal Proceedings that Could be Time Consuming, Result in Costly Litigation, Require Significant Amounts of Management Time and Result in the Diversion of Significant Operational Resources.

We are involved in lawsuits, claims and proceedings incident to the ordinary course of our business.

security breach could also expose us to risks of data loss, litigation and liability and could seriously disrupt our operations and harm

our reputation, any of which could harm our business.

addition, states and the federal government are increasingly enacting laws and regulations to protect consumers against identity theft.

Compliance with these laws will likely increase the costs of doing business and, if we fail to implement appropriate safeguards or to

detect and provide prompt notice of unauthorized access as required by some of these new laws, we could be subject to potential claims

for damages and other remedies, which could harm our results of operations.

and epidemics, natural disasters, terrorist activities, political unrest, and other outbreaks could disrupt our operations, which could

materially and adversely affect our business, financial condition, and results of operations.

pandemics, epidemics in China or elsewhere in the world, or fear of spread of contagious diseases, such as Ebola virus disease (EVD),

coronavirus disease 2019 (COVID-19), Middle East respiratory syndrome (MERS), severe acute respiratory syndrome (SARS), H1N1 flu, H7N9

flu, and avian flu, as well as hurricanes, earthquakes, tsunamis, or other natural disasters could disrupt our business operations, reduce

or restrict our supply of products and services, incur significant costs to protect our employees and facilities, or result in regional

or global economic distress, which may materially and adversely affect our business, financial condition, and results of operations.

Actual or threatened war, terrorist activities, political unrest, civil strife, and other geopolitical uncertainty could have a similar

adverse effect on our business, financial condition, and results of operations.

Any one or more of these events may impede our production

and delivery efforts and adversely affect our sales results, or even for a prolonged period of time, which could materially and adversely

affect our business, financial condition, and results of operations.

are also vulnerable to natural disasters and other calamities.

We cannot assure you that we are adequately protected from the effects

of fire, floods, typhoons, earthquakes, power loss, telecommunications failures, break-ins, war, riots, terrorist attacks, or similar

Any of the foregoing events may give rise to interruptions, damage to our property, delays in production, breakdowns, system

failures, technology platform failures, or internet failures, which could cause the loss or corruption of data or malfunctions of our

facilities, as well as adversely affect our business, financial condition, and results of operations.

inclement weather or other events out of our control may damage or limit production from our facilities and our ability to timely deliver

products thereby adversely affecting our results of operations.

have significant operations in Colorado, Illinois, Pennsylvania, and in other areas where weather or other events such as an earthquake,

tsunami, hurricane, flood, fire, high winds, extreme heat or cold, or other natural or manmade events, could disrupt our operations and

impair production or distribution of our products, damage inventory, interrupt critical functions, or otherwise affect our business negatively,

adversely affecting our results of operations.

in general economic conditions and the resulting impact on consumer confidence and consumer spending could adversely impact our results

of operations.

financial performance is subject to declines in general economic conditions and the impact of such economic conditions on levels of consumer

confidence and consumer spending.

Consumer confidence and consumer spending may deteriorate significantly and could remain depressed

for an extended period of time, whether due to pandemic, inflation, bank failure, or other unrelated reasons.

Consumer purchases of discretionary

items, including specifically our merchandise, generally decline during periods when disposable income is limited, unemployment rates

increase, and consumer perceptions of personal well-being and security declines or there is economic uncertainty.

An uncertain economic

environment could adversely impact our business and operating results.

are and may be subject to regulatory compliance and legal uncertainties.

in government regulation and supervision or proposed Department of Agriculture or other regulatory agency reforms or rule changes could

impair our sources of revenue and limit our ability to expand our business.

In the event any future laws or regulations are enacted which

apply to us, we may have to expend funds and/or alter our operations to ensure compliance.

New legislation or regulation, or the application

of existing laws and regulations to the areas related to our business could add additional costs and risks to doing business.

we are subject to regulations applicable to businesses generally and laws and regulations directly applicable to communications over

the Internet and access to e-commerce.

In addition, it is possible that a number of laws and regulations may be adopted with respect

to the Internet and other areas of our business, covering issues such as user privacy, pricing, content, copyrights, distribution, antitrust,

taxation and characteristics and quality of products and services.

may be subject to legal proceedings that could be time consuming, result in costly litigation, require significant amounts of management

time and result in the diversion of significant operational resources.

are involved in lawsuits, claims and proceedings incident to the ordinary course of our business.

Litigation is inherently unpredictable.

Any claims against us, whether meritorious or not, could be time consuming, result in costly arbitration or litigation, require significant amounts of management time and result in the diversion of significant operational resources.

Even if we believe that we have meritorious defenses against these actions, and we resolve to vigorously defend against them, the cost of defending against all these types of claims against us or the ultimate resolution of such claims, whether by settlement or adverse court decision, may harm our business and operating results and may be in excess of any amounts previously reserved for legal expenses.

In addition, the increasingly regulated business environment and the nature of our products may result in a greater number of enforcement actions and private litigation.

This could subject us to increased exposure to stockholder lawsuits.

Also, we (and our affiliates) may be subject to attempts to bring legal claims by creditors and other third parties related to the liabilities or potential liabilities, of our former subsidiaries, or of the liabilities related to any company whose assets we acquired or do business with.

We are a Smaller Reporting Company, and We Cannot be Certain if the Reduced Reporting Requirements Applicable to Smaller Reporting Companies Will Make our Common Stock Less Attractive to Investors.

We are a smaller reporting company, as defined in the Securities Act of 1934.

For as long as we continue to be a smaller reporting company, we may take advantage of exemptions from various reporting requirements that are applicable to other public companies that are not smaller reporting companies, including not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002, reduced disclosure obligations regarding historical financial statements, executive compensation in our periodic reports, registration statements, and proxy statements and exemptions from the requirements of holding nonbinding advisory votes on executive compensation and stockholder approval of any golden parachute payments not previously approved.

Any claims against us, whether meritorious or not, could be time consuming, result in costly arbitration or litigation, require significant

amounts of management time and result in the diversion of significant operational resources.

Even if we believe that we have meritorious

defenses against these actions, and we resolve to vigorously defend against them, the cost of defending against all these types of claims

against us or the ultimate resolution of such claims, whether by settlement or adverse court decision, may harm our business and operating

results and may be in excess of any amounts previously reserved for legal expenses.

In addition, the increasingly regulated business

environment and the nature of our products may result in a greater number of enforcement actions and private litigation.

This could subject

us to increased exposure to stockholder lawsuits.

Also, we (and our affiliates) may be subject to attempts to bring legal claims by creditors

and other third parties related to the liabilities or potential liabilities, of our former subsidiaries, or of the liabilities related

to any company whose assets we acquired or do business with.

are a smaller reporting company, and we cannot be certain if the reduced reporting requirements applicable to smaller reporting companies

will make our common stock less attractive to investors.

are a smaller reporting company, as defined in the Securities Act of 1933, as amended (the “Securities Act”).

as we continue to be a smaller reporting company, we may take advantage of exemptions from various reporting requirements that are applicable

to other public companies that are not smaller reporting companies, including not being required to comply with the auditor attestation

requirements of Section 404 of the Sarbanes-Oxley Act of 2002, reduced disclosure obligations regarding historical financial statements,

executive compensation in our periodic reports, registration statements, and proxy statements and exemptions from the requirements of

holding nonbinding advisory votes on executive compensation and stockholder approval of any golden parachute payments not previously

We cannot predict if investors will find our common stock less attractive because we may rely on these exemptions.

If some investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock price may be more volatile.

We will remain a smaller reporting company until the beginning of a year in which we had a public float of $250 million held by non-affiliates or revenues below $100 million and a public float below $700 million, in each case as determined as of the last business day of the second quarter of the Company’s fiscal year.

Our Common Stock is Subject to the “ Penny Stock ” Rules of the SEC and the Trading Market in our Securities is Limited, Which Makes Transactions in Our Stock Cumbersome and May Reduce the Value of an Investment in Our Stock.

The Securities and Exchange Commission has adopted Rule 15g-9 which establishes the definition of a “penny stock,” for the purposes relevant to us, as any equity security that has a market price of less than $5.00 per share or with an exercise price, for warrants or options or conversion price for convertible notes, of less than $5.00 per share, subject to certain exceptions.

For any transaction involving a penny stock, unless exempt, the rules require:

●that a broker or dealer approve a person’s account for transactions in penny stocks;

●the broker or dealer receives from the investor a written agreement to the transaction, setting forth the identity and quantity of the penny stock to be purchased.

In order to approve a person’s account for transactions in penny stocks, the broker or dealer must:

●obtain financial information and investment experience objectives of the person;

●make a reasonable determination that the transactions in penny stocks are suitable for that person and the person has sufficient knowledge and experience in financial matters to be capable of evaluating the risks of transactions in penny stocks.

The broker or dealer must also deliver, prior to any transaction in a penny stock, a disclosure schedule prescribed by the Commission relating to the penny stock market, which, in highlight form:

●Sets forth the basis on which the broker or dealer made the suitability determination, and

●that the broker or dealer received a signed, written agreement from the investor prior to the transaction.

Disclosure also has to be made about the risks of investing in penny stocks in both public offerings and in secondary trading and about the commissions payable to both the broker-dealer and the registered representative, current quotations for the securities and the rights and remedies available to an investor in cases of fraud in penny stock transactions.

Finally, monthly statements have to be sent disclosing recent price information for the penny stock held in the account and information on the limited market in penny stocks.

Generally, brokers may be less willing to execute transactions in securities subject to the “penny stock” rules.

This may make it more difficult for investors to dispose of our common stock and cause a decline in the market value of our stock.

investors find our common stock less attractive as a result, there may be a less active trading market for our common stock and our stock

price may be more volatile.

will remain a smaller reporting company until the beginning of a year in which we had a public float of $250 million held by non-affiliates

or revenues below $100 million and a public float below $700 million, in each case as determined as of the last business day of the second

quarter of the Company’s fiscal year.

may not be able to realize benefits of acquisitions or successfully integrate the businesses we acquire.

growth strategy includes growth through strategic acquisitions.

If we are unable to integrate acquired businesses successfully or to

realize anticipated economic, operational, and other benefits and synergies in a timely manner, our profitability could be adversely

Integration of an acquired business may be more difficult when we acquire a business in a market in which we have limited expertise

or with a company culture different from ours.

A significant expansion of our business and operations, in terms of geography or magnitude,

could strain our administrative and operational resources.

Additionally, we may be unable to retain qualified management and other key

personnel employed by acquired companies and may fail to build a network of acquired companies in new markets.

We could face significantly

greater competition from broadline foodservice distributors in these markets than we face in our existing markets.

regularly evaluate opportunities to acquire other companies.

To the extent our future growth includes acquisitions, we may not be able

to obtain any necessary financing for such acquisitions, consummate such potential acquisitions effectively, effectively and efficiently

integrate any acquired entities, or successfully expand into new markets.

connection with our acquisition of businesses in the future, if any, we may decide to consolidate the operations of any acquired business

with our existing operations or make other changes with respect to the acquired business, which could result in special charges or expenses.

Our results of operations also may be adversely affected by expenses we incur in making acquisitions, by amortization of acquisition-related

intangible assets with definite lives and by additional depreciation attributable to acquired assets.

Moreover, in connection with contemplated

or completed acquisitions or divestitures, we may incur related asset impairment charges that reduce our profitability.

rely on trademarks, trade secrets, and other forms of intellectual property protections, however, these protections may not be adequate.

rely on a combination of trademark, trade secret and other intellectual property laws in the United States.

We have applied in the United

States and in certain countries for registration of a limited number of trademarks, some of which have been registered or issued.

cannot guarantee that our applications will be approved by the applicable governmental authorities, or that third parties will not seek

to oppose or otherwise challenge our registrations or applications.

We also rely on unregistered proprietary rights, including common

law trademark protection.

However, third parties may use trademarks identical or confusingly similar to ours, or independently develop

trade secrets or know-how similar or equivalent to ours.

If our proprietary information is divulged to third parties, including our competitors,

or our intellectual property rights are otherwise misappropriated or infringed, our competitive position could be harmed.

products may infringe the intellectual property rights of others, which may cause us to incur unexpected costs or potentially prevent

us from selling our products.

cannot be certain that our products do not and will not infringe intellectual property rights of others.

We may be subject to legal proceedings

and claims in the ordinary course of our business, including claims of alleged infringement of intellectual property rights of third

parties by us or our customers in connection with their use of our products.

Any such claims, whether or not meritorious, could result

in costly litigation and divert the efforts of our management and personnel.

Moreover, should we be found liable for infringement, we

may be required to enter into licensing agreements (if available on acceptable terms or at all) or to pay damages and to cease making

or selling certain products.

Any of the foregoing could cause us to incur significant costs and prevent us from manufacturing or selling

our products.

Our business is subject to governmental regulation, which could impact

our operations.

Our business is subject to extensive federal and state regulations governing the delivery of fresh food products.

Various laws and regulatory frameworks, including but not limited to the FDA’s Food Safety Modernization Act, Pennsylvania’s

Solid Waste Management Act, Clean Streams Law, Air Pollution Control Act, Pennsylvania Food Code, FDA’s Fair Packaging and Labeling

Act, Nutrition Labeling and Education Act, PA Food Safety Act, and Pennsylvania’s Weights and Measures Act, impose stringent operational,

food safety, packaging, and labeling requirements on our company and third-party vendors.

Additionally, specialty

foodservice vendors are required to maintain a minimum of $3,000,000 in liability insurance coverage and comply with Hazard Analysis

and Critical Control Point (HACCP) standards.

Compliance with these regulations is critical to our operations, as noncompliance could

result in significant penalties, legal liabilities, operational disruptions, and reputational harm.

While we currently maintain compliance with applicable

laws and regulations, we cannot guarantee that we will continue to be in compliance in the future, particularly as regulations evolve

or become more stringent.

Regulatory changes or increased enforcement efforts could impose additional costs, limit our ability to operate

efficiently, or require modifications to our business practices.

Any failure to comply with existing or future regulatory requirements

could adversely affect our net revenues, gross margins, and cash flows.

Any regulatory actions or changes that increase our compliance

costs or restrict our ability to source, distribute, or label products effectively may materially impact our financial condition and results

of operations.

Relating to Our Indebtedness

loss of availability of our bank loans could adversely impact our business and financial condition.

currently have multiple loans with MapleMark Bank.

All of these contain cross-default provisions which means that all outstanding borrowings

can be accelerated and can become immediately due and payable in the event of a default in any of such loans, which includes, among other

things, failure to comply with certain financial covenants or breach of representations contained in the loan documents, defaults under

other loans or obligations or involvement in bankruptcy proceedings (as such terms are defined in the loan documents).

We are also subject

to negative covenants which, during the life of the loans, prohibit and/or limit us from, among other things, incurring certain types

of other debt, acquiring other companies, making certain expenditures or investments, and changing the character of our business.

material change to the business and economic landscape negatively impacting our business, including among other things, an outbreak of

infectious disease, a pandemic or a similar public health threat, such as the COVID-19 outbreak, or bank failures, inflation, recession,

or other significant economic turmoil, could adversely impact our ability to comply with such covenants.

Our failure to comply with such

covenants or any other breach of the loan documents could cause a default and we may then be required to repay all of such borrowings

with capital from other sources.

Under these circumstances, other sources of capital may not be available or may be available only on

unfavorable terms.

In the event of a default, it is possible that our assets and certain of our subsidiaries’ assets may be attached

or seized by the lenders.

Any (i) failure by us to comply with the covenants or other provisions of the loan documents, (ii) difficulty

in securing any required future financing, or (iii) any such seizure or attachment of assets could have a material adverse effect on

our business and financial condition.

ability to generate sufficient cash to service our indebtedness depends on many factors, some of which are not within our control.

ability to make payments on our indebtedness will depend on our ability to generate cash in the future.

To a certain extent, this ability

is subject to general economic, financial, competitive, legislative, regulatory, and other factors that are beyond our control.

are unable to generate sufficient cash flow to service our debt, we may need to restructure or refinance all or a portion of our debt,

sell material assets or operations, or raise additional debt or equity capital.

We may not be able to affect any of these actions on

a timely basis, on commercially reasonable terms, or at all, and these actions may not be sufficient to meet our debt service requirements.

In addition, any refinancing of our indebtedness could be at a higher interest rate, and the terms of our existing or future debt arrangements

may restrict us from effecting any of these alternatives.

Our failure to make the required interest and principal payments on our indebtedness

would result in an event of default under the agreement governing such indebtedness, which may result in the acceleration of some or

all of our outstanding indebtedness.

our level of indebtedness, we and our subsidiaries will still be able to incur significant additional amounts of debt, which could further

exacerbate the risks associated with our level of indebtedness.

and our subsidiaries may incur substantial additional indebtedness in the future.

Although the agreements governing our indebtedness

contain restrictions on the incurrence of additional indebtedness, these restrictions are subject to a number of significant qualifications

and exceptions and, under certain circumstances, the amount of indebtedness that could be incurred in compliance with these restrictions

could be substantial.

agreements governing our outstanding indebtedness contain restrictions that limit our flexibility in operating our business.

agreements governing our outstanding indebtedness contain various covenants that limit our ability to engage in specified types of transactions.

These covenants limit the ability of our subsidiaries to, among other things:

assume, or permit to exist additional indebtedness or guarantees;

investments and loans;

dividends, make payments, or redeem or repurchase capital stock;

in mergers, liquidations, dissolutions, asset sales, and other dispositions (including sale

leaseback transactions);

or otherwise alter terms of certain indebtedness;

into agreements limiting subsidiary distributions or containing negative pledge clauses;

in certain transactions with affiliates;

the business that we conduct;

our fiscal year;

in any activities other than permitted activities.

a result of these restrictions, we are limited as to how we conduct our business and we may be unable to raise additional debt or equity

financing to compete effectively or to take advantage of new business opportunities.

The terms of any future indebtedness we may incur

could include more restrictive covenants.

We cannot assure you that we will be able to maintain compliance with these covenants in the

future and, if we fail to do so, that we will be able to obtain waivers from the lenders and/or amend the covenants.

breach of any of these covenants could result in a default under one or more of these agreements, including as a result of cross default

provisions, and acceleration of amounts due, and exercise of lender’s rights and remedies, including rights with respect to the

collateral securing the obligations.

utilize derivative financial instruments to reduce our exposure to market risks from changes in interest rates on our variable rate indebtedness,

and we are exposed to risks related to counterparty credit worthiness or non-performance of these instruments.

enter into pay-fixed interest rate swaps to limit our exposure to changes in variable interest rates.

Such instruments may result in

economic losses should interest rates decline to a point lower than our fixed rate commitments.

We are also exposed to credit-related

losses, which could affect the results of operations in the event of fluctuations in the fair value of the interest rate swaps due to

a change in the credit worthiness or non-performance by the counterparties to the interest rate swaps.

Relating to Our Securities

we do not intend to pay any cash dividends on our shares of common stock, our stockholders will not be able to receive a return on their

shares unless they sell them .

intend to retain any future earnings to finance the development and expansion of our business.

We do not anticipate paying any cash dividends

on our common stock in the foreseeable future.

Unless we pay dividends, our stockholders will not be able to receive a return on their

shares unless they sell them at a price higher than that which they initially paid for such shares.

common stock is subject to the “ penny stock ” rules of the Securities and Exchange Commission (the “SEC”)

and the trading market in our securities is limited, which makes transactions in our stock cumbersome and may reduce the value of an

investment in our stock.

SEC has adopted Rule 15g-9 which establishes the definition of a “penny stock,” for the purposes relevant to us, as any equity

security that has a market price of less than $5.00 per share or with an exercise price, for warrants or options or conversion price

for convertible notes, of less than $5.00 per share, subject to certain exceptions.

For any transaction involving a penny stock, unless

exempt, the rules require:

● that a broker or dealer approve a person’s account

for transactions in penny stocks;

● the broker or dealer receives from the investor a written

agreement to the transaction, setting forth the identity and quantity of the penny stock to be purchased.

order to approve a person’s account for transactions in penny stocks, the broker or dealer must:

financial information and investment experience objectives of the person;

a reasonable determination that the transactions in penny stocks are suitable for that person

and the person has sufficient knowledge and experience in financial matters to be capable

of evaluating the risks of transactions in penny stocks.

broker or dealer must also deliver, prior to any transaction in a penny stock, a disclosure schedule prescribed by the SEC relating to

the penny stock market, which, in highlight form:

forth the basis on which the broker or dealer made the suitability determination, and

the broker or dealer received a signed, written agreement from the investor prior to the

also has to be made about the risks of investing in penny stocks in both public offerings and in secondary trading and about the commissions

payable to both the broker-dealer and the registered representative, current quotations for the securities and the rights and remedies

available to an investor in cases of fraud in penny stock transactions.

Finally, monthly statements have to be sent disclosing recent

price information for the penny stock held in the account and information on the limited market in penny stocks.

brokers may be less willing to execute transactions in securities subject to the “penny stock” rules.

This may make it more

difficult for investors to dispose of our common stock and cause a decline in the market value of our stock.

market price of our common stock has been and will likely continue to be volatile, and you could lose all or part of your investment.

market price of our common stock may be subject to wide fluctuations in response to various factors, some of which are beyond our control

and may not be related to our operating performance.

In addition to the factors discussed in this “ Risk Factors ” section

and elsewhere in this Annual Report on Form 10-K, factors that could cause fluctuations in the market price of our common stock include

the following:

economic, regulatory, and market conditions;

health crises and related measures to protect the public health;

of shares of our common stock by us or our stockholders;

of shares of our common stock, whether in connection with an acquisition or disposition of

our subsidiaries or assets;

selling of our common stock or related derivative securities;

time to time we make investments in equity that is, or may become, publicly held, and we

may experience volatility due to changes in the market prices of such equity investments;

by securities or industry analysts, media or other third parties, that are interpreted either

negatively or positively by investors, failure of securities analysts to maintain coverage

and/or to provide accurate consensus results of us, changes in financial estimates by securities

analysts who follow us, or our failure to meet these estimates or the expectations of investors;

financial or other projections we may provide to the public, any changes in those projections,

or our failure to meet those projections;

● announcements

by us or our competitors of new products or services;

and market speculation involving us or other companies in our industry;

or perceived security incidents that we or our service providers may suffer;

or anticipated developments in our business, our competitors’ businesses, or the competitive

landscape generally.

addition, in the past, following periods of volatility in the overall market and the market price of a particular company’s securities,

securities class action litigation has often been instituted against these companies.

Such litigation could result in substantial costs

and a diversion of our management’s attention and resources.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1A. Risk Factors