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Item 8. Financial Statements and Supplementary Data

2025-03-20 compared with 2024-03-21 · 1067 added, 601 removed, 286 unchanged (85% of the section changed)

Financial Statements and Supplementary Data

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Stockholders’ and Board of Directors

Innovative Food Holdings, Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheet of Innovative Food Holdings, Inc.

and Subsidiaries (the Company) as of December 31, 2023 and 2022 and the related consolidated statements of operations, stockholders’ equity and cash flows for the each of the two years in the period ended December 31, 2023 and the related consolidated notes (collectively referred to as the financial statements).

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2023 and 2022, and the results of its operations and its cash flows for the each of the two years in the period ended December 31, 2023, in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company’s management.

Our responsibility is to express an opinion on the Company’s financial statements based on our audits.

We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.

As part of our audit, we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over financial reporting.

OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Stockholders’

and Board of Directors

Food Holdings, Inc.

on the Financial Statements

have audited the accompanying consolidated balance sheets of Innovative Food Holdings, Inc.

and Subsidiaries (the Company) as of December

31, 2024 and 2023 and the related consolidated statements of operations, stockholders’ equity and cash flows for the each of the

two years in the period ended December 31, 2024 and the related consolidated notes (collectively referred to as the financial statements).

In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December

31, 2024 and 2023, and the results of its operations and its cash flows for the each of the two years in the period ended December 31,

2024, in conformity with accounting principles generally accepted in the United States of America.

consolidated financial statements are the responsibility of the Company’s management.

Our responsibility is to express an opinion

on the Company’s financial statements based on our audits.

We are a public accounting firm registered with the Public Company Accounting

Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S.

securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

conducted our audits in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit to obtain

reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud.

is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.

As part of our audit,

we are required to obtain an understanding of internal control over financial reporting, but not for the purpose of expressing an opinion

on the effectiveness of the Company’s internal control over financial reporting.

Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements.

Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that:

(1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

We did not identify any critical audit matters that need to be communicated.

We have served as the Company’s auditor since 2022

Margate, Florida

audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error

or fraud, and performing procedures that respond to those risks.

Such procedures included examining, on a test basis, evidence regarding

the amounts and disclosures in the financial statements.

Our audits also included evaluating the accounting principles used and significant

estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that our audits

provide a reasonable basis for our opinion.

Audit Matters

critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated

or required to be communicated to the audit committee and that:

(1) relate to accounts or disclosures that are material to the financial

statements and (2) involved our especially challenging, subjective, or complex judgments.

The communication of critical audit matters

does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit

matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

did not identify any critical audit matters that need to be communicated.

have served as the Company’s auditor since 2022

Coral Springs, Florida

March 20, 2025

ASSURANCE DIMENSIONS CERTIFIED PUBLIC ACCOUNTANTS & ASSOCIATES

also d/b/a McNAMARA and ASSOCIATES, PLLC

4920 W Cypress Street, Suite 102 | Tampa, FL 33607 | Office:

ASSURANCE DIMENSIONS ,

also d/b/a McNAMARA and ASSOCIATES, LLC

4920 W Cypress Street, Suite

102 | Tampa, FL 33607 | Office:

813.443.5048 | Fax:

JACKSONVILLE :

4720 Salisbury Road, Suite 223 | Jacksonville, FL 32256 | Office:

7800 Belfort Parkway, Suite

290 | Jacksonville, FL 32256 | Office:

888.410.2323 | Fax:

1800 Pembrook Drive, Suite 300 | Orlando, FL 32810 | Office:

1800 Pembrook Drive, Suite 300

| Orlando, FL 32810 | Office:

888.410.2323 | Fax:

SOUTH FLORIDA :

2000 Banks Road, Suite 218 | Margate, FL 33063 | Office:

University Drive,

Suite 621 | Coral Springs, FL 33065 | Office:

754.800.3400 | Fax:

www.assurancedimensions.com

Innovative Food Holdings, Inc.

Consolidated Balance Sheets

Dimensions” is the brand name under which Assurance Dimensions, LLC including its

subsidiary McNamara and Associates, LLC (referred together as “AD LLC”) and AbitOs

Advisors, LLC (“AbitOs Advisors”) , provide professional services.

AbitOs Advisors practice as an alternative practice structure in accordance with the AICPA

Code of Professional Conduct and applicable laws, regulations, and professional standards.

a licensed independent CPA firm that provides attest services to its clients, and AbitOs Advisors provide

tax and business consulting services to their clients.

AbitOs Advisors , and its subsidiary

entities are not licensed CPA firms.

Food Holdings, Inc.

Balance Sheets

Current assets

9 unchanged sentences

Right of use assets, finance leases, net

Other amortizable intangible assets, net

Amortizable intangible assets, net

Tradenames and other unamortizable intangible assets

5 unchanged sentences

Deferred revenue

Line of Credit

Stock appreciation rights liability

2 unchanged sentences

Lease liability - finance leases, current

Contingent liability, current

Current liabilities - discontinued operations

10 unchanged sentences

500,000,000 shares authorized;

52,538,100 and 49,427,297 shares issued, and 49,714,929 and 46,589,717 shares outstanding at December 31, 2023 and December 31, 2022, respectively

56,009,032 and 52,538,100 shares issued, 53,164,735 and 49,714,929 shares outstanding at December 31, 2024 and 2023, respectively

Common stock to be issued;

738,032 and 0 shares at December 31, 2024 and 2023, respectively

Additional paid-in capital

Common stock to be issued, 0 and 1,499,940 shares at December 31, 2023 and December 31, 2022, respectively

Treasury stock:

2,623,171 shares outstanding at December 31, 2023 and December 31, 2022

2,644,297 and 2,623,171 shares outstanding at December 31, 2024 and 2023, respectively

( 1,141,372 )

( 1,141,370 )

Accumulated deficit

( 36,209,764 )

( 38,821,278 )

Total stockholders’ equity

Total liabilities and stockholders’ equity

See notes to consolidated financial statements.

Innovative Food Holdings, Inc.

Consolidated Statements of Operations

Cost of goods sold

Selling, general and administrative expenses

Separation costs - executive officers

Impairment of intangible assets

Total operating expenses

Operating loss

notes to consolidated financial statements.

Food Holdings, Inc.

Statements of Operations

Twelve Months

of goods sold

general and administrative expenses

costs - executive officers

of intangible assets

operating expenses

income (loss)

( 2,808,244 )

income (expense:)

on sale of assets

(loss) on sale of subsidiary

leasing income

other income (expense)

Interest expense, net

Loss on sale of subsidiaries

Gain on sale of assets

Other leasing income

Gain on contingent liability

Impairment of investment

Loss on extinguishment of debt

Total other expense

Net loss before taxes

Income tax expense

Net loss from continuing operations

Net loss from discontinued operations

Consolidated net loss

Net loss per share from continuing operations - basic

Net loss per share from continuing operations - diluted

Net loss per share from discontinued operations - basic

Net loss per share from discontinued operations - diluted

Weighted average shares outstanding - basic

Weighted average shares outstanding - diluted

See notes to consolidated financial statements.

Innovative Food Holdings, Inc.

Consolidated Statement of Changes in Stockholders' Equity

For the Years Ended December 31, 2023 and 2022

Additional Paid-in

Treasury Stock

Balance - December 31, 2021

Fair value of vested stock and stock options

Common stock issued for services

Offering expenses for stock previously sold for cash

Shares issued to management and employees, previously accrued

Net loss for year ended December 31, 2022

Balance - December 31, 2022

Shares issued for compensation

Shares issued to management and employees from common stock subscribed

Fair value of shares under compensation plan

Shares issued under severance agreement

Common stock issued to employees for compensation

Common stock issued under management compensation plan

Common stock issued from common stock subscribed

Common stock issued for cashless exercise of stock options

Net loss for year ended December 31, 2023

Balance – December 31, 2023

See notes to consolidated financial statements.

Innovative Food Holdings, Inc.

Consolidated Statements of Cash Flows

Cash flows from operating activities:

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

Gain on contingent liabilities

Gain on disposition of asset

Loss on sale of subsidiaries

Impairment of investment

Impairment of intangible assets

(loss) before taxes

( 3,697,833 )

(loss) from continuing operations

$ ( 3,713,667 )

income (loss) from discontinued operations

$ ( 641,485 )

net income (loss)

$ ( 4,355,152 )

income (loss) per share from continuing operations - basic

income (loss) per share from continuing operations - diluted

(loss) per share from discontinued operations - basic

(loss) per share from discontinued operations - diluted

average shares outstanding - basic

average shares outstanding - diluted

notes to consolidated financial statements.

Food Holdings, Inc.

Statement of Changes in Stockholders’ Equity

the Years Ended December 31, 2024 and 2023

- December 31, 2022

$ ( 1,141,370 )

$ ( 34,466,126 )

issued for compensation

issued to management and employees from common stock subscribed

value of shares under compensation plan

issued under severance agreement

issued to employees for compensation

issued under management compensation plan

issued from common stock subscribed

issued for cashless conversion of stock options

loss for the year ended December 31, 2023

( 4,355,152 )

- December 31, 2023

$ ( 1,141,370 )

$ ( 38,821,278 )

- December 31, 2023

( 1,141,370 )

( 38,821,278 )

returned to treasury from sale of subsidiary

value of shares under compensation plan

Shares earned under compensation plans

withheld for taxes under compensation plans

issue for cashless exercise of options

sold for cash

income for the year ended December 31, 2024

- December 31, 2024

$ ( 1,141,372 )

$ ( 36,209,764 )

notes to consolidated financial statements.

Food Holdings, Inc.

Statements of Cash Flows

Twelve Months

Cash flows used in operating activities:

Net income (loss)

$ ( 4,355,152 )

Adjustments to reconcile net income (loss) to net cash used in operating activities:

Gain on disposition of assets

( 2,816,616 )

(Gain) Loss on sale of subsidiaries

Impairment of intangible assets (of which $ 0 and $ 260,422 is included in discontinued operations)

Depreciation and amortization

2 unchanged sentences

Amortization of prepaid loan fees

Amortization of discount on notes payable

Stock based compensation

Value of stock appreciation rights

Loss on extinguishment of debt

Provision (recoveries) for doubtful accounts

Changes in assets and liabilities:

Accounts receivable, net

( 3,826,006 )

Inventory and other current assets, net

( 1,936,193 )

Accounts payable and accrued liabilities

3 unchanged sentences

Net cash used in operating activities

( 6,271,993 )

Cash flows from investing activities:

Cash paid for acquisition of Golden Organics

( 1,231,379 )

Cash received in acquisition of LoCo Foods

Acquisition of property and equipment

Cash received from sale of subsidiaries

Cash received from disposition of asset

Net cash used in investing activities

Cash received from disposition of asset, net of loan payoff

Cash received from disposition of intangible assets, net of costs

Net cash provided by (used in) investing activities

Cash flows from financing activities:

Payment of offering costs for stock previously issued

Cash received from sale of common stock, net of costs

Cash received from notes payable, net of costs

Payment for taxes related to net share settlement of equity awards, net

Principal payments on debt

1 unchanged sentence

Principal payments on line of credit

Cost of debt financing

Net cash provided by (used in) financing activities

Increase (decrease) in cash and cash equivalents

( 2,014,333 )

Net cash provided by financing activities

(Decrease) increase in cash and cash equivalents

( 3,042,140 )

Cash and cash equivalents at beginning of period

Cash and cash equivalents at end of period - continuing operations

Cash and cash equivalents at end of period – discontinued

Cash and cash equivalents at end of period – total

Cash and cash equivalents at end of period - discontinued operations

Cash and cash equivalents at end of period

Supplemental disclosure of cash flow information:

1 unchanged sentence

Non-cash investing and financing activities:

(Decrease) Increase in right of use assets & liabilities

Finance lease for fixed assets

Debt to Fifth Third Bank paid directly by Maple Mark Bank

Par value of shares issued, previously accrued

Financing lease – warehouse equipment

Issuance of common stock for severance agreement previously accrued

Par value of shares issued, previously accrued

Reclassify fixed assets as held for sale

See notes to consolidated financial statements.

INNOVATIVE FOOD HOLDINGS, INC.

Issuance of stock for cashless exercise of options

Summary of assets and liabilities acquired in asset purchase agreements:

Assets acquired – Golden Organic

Liabilities acquired – Golden Organic

ROU assets and liabilities – Golden Organics

Assets acquired – LOCO Foods

Liabilities acquired – LOCO Foods

Summary of assets and liabilities disposed:

Assets disposed – sale of building

Liabilities settled – sale of building

notes to consolidated financial statements.

FOR THE YEARS ENDED DECEMBER 31, 2023 and 2022

FOOD HOLDINGS, INC.

TO CONSOLIDATED FINANCIAL STATEMENTS

THE YEARS ENDED DECEMBER 31, 2024 and 2023

NATURE OF ACTIVITIES AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying audited consolidated financial statements include those of Innovative Food Holdings, Inc.

and all of its wholly-owned subsidiaries (collectively, the “Company”) and have been prepared in accordance with generally accepted accounting principles pursuant to Regulation S-X of the Securities and Exchange Commission and with the instructions to Form 10-K.

All intercompany transactions have been eliminated in consolidation.

In the opinion of management, the audited consolidated financial statements reflect all adjustments, including normal recurring adjustments, necessary for fair presentation of the interim periods presented.

Business Activity

We provide difficult-to-find specialty foods primarily to both Professional Chefs and Home Gourmets through our relationships with producers, growers, makers and distributors of these products worldwide.

The distribution of these products primarily originates from our three unified warehouses and those of our drop ship partners, and is driven by our proprietary technology platform.

In addition, we provide value-added services through our team of food specialists and Chef Advisors who offer customer support, menu ideas, and preparation guidance.

of Presentation

accompanying audited consolidated financial statements include those of Innovative Food Holdings, Inc.

and all of its wholly-owned subsidiaries

(collectively, the “Company”) and have been prepared in accordance with generally accepted accounting principles pursuant

to Regulation S-X of the Securities and Exchange Commission and with the instructions to Form 10-K.

All intercompany transactions have

been eliminated in consolidation.

In the opinion of management, the audited consolidated financial statements reflect all adjustments,

including normal recurring adjustments, necessary for fair presentation of the interim periods presented.

provide difficult-to-find specialty foods primarily to both Professional Chefs and Home Gourmets through our relationships with producers,

growers, makers and distributors of these products worldwide.

The distribution of these products primarily originates from our three

unified warehouses and those of our drop ship partners, and is driven by our proprietary technology platform.

In addition, we provide

value-added services through our team of food specialists and Chef Advisors who offer customer support, menu ideas, and preparation guidance.

Restructuring

During the fourth quarter of 2023 we made the decision to focus more on our Business to Business (B2B) activities and less on our Direct to Consumer (D2C) products.

Our subsidiaries GROW and Oasis were sold effective December 29, 2023;

Haley is being held for sale;

and the activities of P Innovations will be abandoned.

Our remaining D2C business, primarily operated within iGourmet and Mouth, will be downsized.

Discontinued Operations

During the fourth quarter of 2023 we made the decision to discontinue certain of our business activities.

the fourth quarter of 2023 we made the decision to focus more on our Business to Business (B2B) activities and less on our Direct to

Consumer (D2C) products.

Our subsidiaries GROW and Oasis were sold effective December 29, 2023;

Haley is being held for sale;

and the activities of P Innovations will be abandoned.

Pursuant to the guidance of ASC 205-20 Presentation of Financial Statements – Discontinued Operations, the accounts of these entities have been included in “Net loss from discontinued operations” in our consolidated statements of operations.

Additionally, the assets and liabilities of these entities have been presented as discontinued operations in our consolidated balance sheets as of December 31, 2023 and December 31, 2022.

Use of Estimates

The preparation of these consolidated financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities.

On an on-going basis, we evaluate these estimates, including those related to revenue recognition and concentration of credit risk.

We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under 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.

Accounts subject to estimate and judgements are allowance for accounts receivable, allowance for slow moving and obsolete inventory, income taxes, intangible assets, contingent liabilities, operating and finance right of use assets and liabilities, and equity-based instruments.

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

We believe our estimates have not been materially inaccurate in past years, and our assumptions are not likely to change in the foreseeable future.

Food Group, Inc.

(“Haley”) was sold effective February 26, 2024;

the igourmet platform and its D2C components were sold effective

August 6, 2024;

we continue to operate the B2B component, which remains part of our continuing operations.

On October 8, 2024, we sold

substantially all of the assets of Mouth.

The activities of P Innovations will be abandoned.

to the guidance of Accounts Standards Codification (“ASC”) 205-20, Presentation of Financial Statements – Discontinued

Operations, the accounts of our discontinued entities GROW, Oasis, Haley, P Innovations, and Mouth are included in “Net

loss from discontinued operations” in our consolidated statements of operations.

Additionally, the assets and liabilities of these

entities have been presented as discontinued operations in our consolidated balance sheets.

On December 29, 2023, the Company completed

the sales of its Grow and Oasis subsidiaries, on February 26, 2024, the Company completed the sale of its Haley subsidiary (see Note

4), and on October 8, 2024, the Company completed the sale of substantially all of the assets of Mouth.

In addition, the operations of

P Innovations have been abandoned.

The only remaining discontinued operations on the Company’s balance sheet at December 31, 2024

is cash in the amount of $ 49,315 held by Mouth.

The preparation of these consolidated financial

statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses,

and related disclosure of contingent assets and liabilities.

On an on-going basis, we evaluate these estimates, including those related

to revenue recognition and concentration of credit risk.

We base our estimates on historical experience and on various other assumptions

that are believed to be reasonable under 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.

Accounts subject to estimate and judgements are allowance

for credit losses, allowance for slow moving and obsolete inventory, income taxes, intangible assets, contingent liabilities, operating

and finance right of use assets and liabilities, and equity-based instruments.

Actual results may differ from these estimates under different

assumptions or conditions.

We believe our estimates have not been materially inaccurate in past years, and our assumptions are not likely

to change in the foreseeable future.

Reclassifications

Certain amounts presented in the financial statements of the prior period have been reclassified to conform with the current period presentation of discontinued operations.

Revenue Recognition

The Company recognizes revenue upon product delivery.

All of our products are shipped either same day or overnight or through longer shipping terms to the customer and the customer takes title to product and assumes risk and ownership of the product when it is delivered.

Shipping charges to customers and sales taxes collectible from customers, if any, are included in revenues.

For revenue from product sales (i.e., specialty foodservice and e-commerce), the Company recognizes revenue in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 606 “ Revenue from Contracts with Customers ”.

amounts presented in the financial statements of the prior period have been reclassified to conform with the current period presentation

of discontinued operations.

Company recognizes revenue upon product delivery.

All of our products are shipped either same day or overnight or through longer shipping

terms to the customer and the customer takes title to product and assumes risk and ownership of the product when it is delivered.

charges to customers and sales taxes collectible from customers, if any, are included in revenues.

revenue from product sales (i.e., specialty foodservice and e-commerce), the Company recognizes revenue in accordance with Financial

Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 606 “ Revenue from

Contracts with Customers ”.

A five-step analysis must be met as outlined in Topic 606:

(i) identify the contract with the customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations, and (v) recognize revenue when (or as) performance obligations are satisfied.

Provisions for discounts and rebates to customers, estimated returns and allowances, and other adjustments are provided for in the same period the related sales are recorded.

The Company defers any revenue for which the product has not been delivered or is subject to refund until such time that the Company and the customer jointly determine that the product has been delivered or no refund will be required.

Revenue from brand management services are comprised of fees and/or commissions associated with client sales.

Revenue from brand management services are recognized at the point in time when services are rendered to the client.

Warehouse and logistic services revenue is primarily comprised of inventory management, order fulfilment and warehousing services.

Warehouse & logistics services revenues are recognized at the point in time when the services are rendered to the customer.

Disaggregation of Revenue

The following table represents a disaggregation of revenue by from sales for the years ended December 31, 2023 and 2022:

Specialty foodservice

Warehouse and Logistic Services

Cost of goods sold

We have included in cost of goods sold all costs which are directly related to the generation of revenue.

These costs include primarily the cost of food and raw materials, packing and handling, shipping, and delivery costs.

We have also included all payroll costs as cost of goods sold in our leasing and logistics services business.

Selling, general, and administrative expenses

We have included in selling, general, and administrative expenses all other costs which support the Company’s operations, but which are not includable as a cost of sales.

These include primarily payroll, facility costs such as rent and utilities, selling expenses such as commissions and advertising, amortization of intangible assets, depreciation, and other administrative costs including professional fees and costs associated with non-cash stock compensation.

(i) identify the contract with the customer,

(ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price

to the performance obligations, and (v) recognize revenue when (or as) performance obligations are satisfied.

Provisions for discounts

and rebates to customers, estimated returns and allowances, and other adjustments are provided for in the same period the related sales

are recorded.

The Company defers any revenue for which the product has not been delivered or is subject to refund until such time that

the Company and the customer jointly determine that the product has been delivered or no refund will be required.

and logistic services revenue is primarily comprised of inventory management, order fulfilment and warehousing services.

logistics services revenues are recognized at the point in time when the services are rendered to the customer.

Disaggregation

following table represents a disaggregation of revenue by from sales for the years ended December 31, 2024 and 2023:

Digital Channels

National Distribution

Local Distribution

Direct-to-Consumer

Other Services

of goods sold

have included in cost of goods sold all costs which are directly related to the generation of revenue.

These costs include primarily

the cost of food and raw materials, packing and handling, shipping, and delivery costs.

We have also included all payroll costs as cost

of goods sold in our leasing and logistics services business.

general, and administrative expenses

have included in selling, general, and administrative expenses all other costs which support the Company’s operations, but which

are not includable as a cost of sales.

These include primarily payroll, facility costs such as rent and utilities, selling expenses such

as commissions and advertising, amortization of intangible assets, depreciation, and other administrative costs including professional

fees and costs associated with non-cash stock compensation.

Advertising costs are expensed as incurred.

Cash and Cash Equivalents

Cash equivalents include all highly liquid debt instruments with original maturities of three months or less which are not securing any corporate obligations.

Concentrations of Credit Risk

Financial instruments and related items, which potentially subject the Company to concentrations of credit risk, consist primarily of cash, cash equivalents and trade receivables.

and Cash Equivalents

equivalents include all highly liquid debt instruments with original maturities of three months or less which are not securing any corporate

Concentrations

of Credit Risk

instruments and related items, which potentially subject the Company to concentrations of credit risk, consist primarily of cash, cash

equivalents and trade receivables.

The Company places its cash and temporary cash in investments with credit quality institutions.

At times, such investments may be in excess of applicable government mandated insurance limit.

At December 31, 2023 and 2022, trade receivables from the Company’s largest customer amounted to 26 % and 20 %, respectively, of total trade receivables.

During the year ended December 31, 2023 and 2022, sales from the Company’s largest customer amounted to 47 % and 49 % of total sales, respectively.

The Company maintains cash balances in excess of Federal Deposit Insurance Corporation limits.

At December 31, 2023 and 2022, the total cash in excess of these limits was $ 988,825 and $ 3,205,568 , respectively.

Accounts Receivable

The Company provides an allowance for doubtful accounts equal to the estimated uncollectible amounts pursuant to the guidance of Accounting Standards Update (ASU) 2016-13, Financial Instruments – Credit Losses (Topic 326) as codified in Accounts Standards Codification (ASC) 326, Financial Instruments – Credit Losses.

times, such investments may be in excess of applicable government mandated insurance limit.

At December 31, 2024 and 2023, trade receivables

from the Company’s largest customer amounted to 10 % and 26 %, respectively, of total trade receivables.

During the year ended December

31, 2024 and 2023, sales from the Company’s largest customer amounted to 43 % and 48 % of total sales, respectively.

Company maintains cash balances in excess of Federal Deposit Insurance Corporation limits.

At December 31, 2024 and 2023, the total cash

in excess of these limits was $ 1,016,918 and $ 988,825 , respectively.

The Company provides an allowance for doubtful

accounts equal to the estimated uncollectible amounts pursuant to the guidance of Accounting Standards Update (ASU) 2016-13, Financial

Instruments – Credit Losses (Topic 326) as codified in Accounts Standards Codification (ASC) 326, Financial Instruments –

Credit Losses.

Under ASC 326, the Company utilizes a current and expected credit loss (CECL) impairment model.

ASU 2016-13 became effective for us on January 1, 2023.

The Company’s estimate is based on historical collection experience and a review of the current status of trade accounts receivable.

It is reasonably possible that the Company’s estimate of the allowance for doubtful accounts will change.

Accounts receivable are presented net of an allowance for doubtful accounts of $ 46,477 and $ 340,225 at December 31, 2023, and 2022, respectively.

Assets Held for Sale

Assets held for sale include the net book value of property and equipment that the Company plans to sell within the next year.

Long-lived assets that meet the held for sale criteria are held for sale and reported at the lower of their carrying value or fair value, less estimated costs to sell.

If the determination is made that the Company no longer expects to sell an asset within the next year, the asset is reclassified out of assets held for sale.

Property and Equipment

Property and equipment are valued at cost.

ASU 2016-13 became effective

for us on January 1, 2023.

The Company’s estimate is based on historical collection experience and a review of the current status

of trade accounts receivable.

It is reasonably possible that the Company’s estimate of the allowance for doubtful accounts will

Accounts receivable are presented net of an allowance for credit losses of $ 40,002 and $ 46,477 at December 31, 2024, and 2023,

respectively.

Held for Sale

held for sale include the net book value of property and equipment that the Company plans to sell within the next year.

Long-lived assets

that meet the held for sale criteria are held for sale and reported at the lower of their carrying value or fair value, less estimated

costs to sell.

If the determination is made that the Company no longer expects to sell an asset within the next year, the asset is reclassified

out of assets held for sale.

and Equipment

and equipment are valued at cost.

Depreciation is provided over the estimated useful lives up to five years using the straight-line method.

Leasehold improvements are depreciated on a straight-line basis over the term of the lease.

The estimated service lives of property and equipment are as follows:

Computer Equipment

Warehouse Equipment

Warehouse Equipment - Heavy

Office Furniture and Fixtures

Inventory is valued at the lower of cost or market and is determined by the first-in, first-out method.

In addition to an allowance for obsolete or slow moving inventory, the Company adjusts inventory based upon bi-weekly cycle counts and upon the expiration date of food products.

Deferred Revenue

Certain customer arrangements in the Company's business such as gift cards and e-commerce subscription purchases result in deferred revenues when cash payments are received in advance of performance.

Gift cards issued by the Company generally have an expiration of five years from the date of purchase.

The Company records a liability for unredeemed gift cards and advance payments for monthly club memberships as cash is received, and the liability is reduced when the card is redeemed or the product delivered.

The following table represents the changes in deferred revenue as reported on the Company’s consolidated balance sheets:

estimated service lives of property and equipment are as follows:

Computer Equipment 3 years

Warehouse Equipment 5 years

Warehouse Equipment - Heavy 10 years

Office Furniture and Fixtures 5 years

Vehicles 5 years

Buildings 30 years

is valued at the lower of cost or market and is determined by the first-in, first-out method.

In addition to an allowance for obsolete

or slow moving inventory, the Company adjusts inventory based upon bi-weekly cycle counts and upon the expiration date of food products.

customer arrangements in the Company’s business such as gift cards and e-commerce subscription purchases result in deferred revenues

when cash payments are received in advance of performance.

Gift cards issued by the Company generally have an expiration of five years

from the date of purchase.

The Company records a liability for unredeemed gift cards and advance payments for monthly club memberships

as cash is received, and the liability is reduced when the card is redeemed or the product delivered.

October 8, 2024, the Company sold substantially all of the assets of Mouth, and the buyer assumed the liability for deferred revenue

in the amount of $ 174,637 .

following table represents the changes in deferred revenue as reported on the Company’s consolidated balance sheets:

Balance as of December 31, 2022

1 unchanged sentence

Net sales recognized

( 3,293,325 )

Balance as of December 31, 2023

Deferred revenue assumed by buyer

$ ( 174,637 )

Cash payments received

Net sales recognized

( 9,478,594 )

Balance as of December 31, 2024

The Company accounts for income taxes under the asset and liability method in accordance with ASC 740.

The Company recognizes deferred tax liabilities and assets for the expected future tax consequences of events that have been included in the financial statements or tax returns.

Under this method, deferred tax liabilities and assets are determined based on the difference between the financial statement and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse.

Company accounts for income taxes under the asset and liability method in accordance with ASC 740.

The Company recognizes deferred tax

liabilities and assets for the expected future tax consequences of events that have been included in the financial statements or tax

Under this method, deferred tax liabilities and assets are determined based on the difference between the financial statement

and tax bases of assets and liabilities using enacted tax rates in effect for the year in which the differences are expected to reverse.

The components of the deferred tax assets and liabilities are classified as current and non-current based on their characteristics.

A valuation allowance is provided for certain deferred tax assets if it is more likely than not that the Company will not realize tax assets through future operations.

valuation allowance is provided for certain deferred tax assets if it is more likely than not that the Company will not realize tax assets

through future operations.

This standard was adopted by the Company effective January 1, 2021.

Fair Value of Financial Instruments

The carrying amount of the Company’s cash and cash equivalents, accounts receivable, notes payable, line of credit, accounts payable and accrued expenses, none of which is held for trading, approximates their estimated fair values due to the short-term maturities of those financial instruments.

The Company adopted ASC 820-10, “Fair Value Measurements”, which provides a framework for measuring fair value under GAAP.

ASC 820-10 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.

Value of Financial Instruments

carrying amount of the Company’s cash and cash equivalents, accounts receivable, notes payable, line of credit, accounts payable

and accrued expenses, none of which is held for trading, approximates their estimated fair values due to the short-term maturities of

those financial instruments.

Company adopted ASC 820-10, “Fair Value Measurements”, which provides a framework for measuring fair value under GAAP.

820-10 defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in

the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement

ASC 820-10 requires that valuation techniques maximize the use of observable inputs and minimize the use of unobservable inputs.

Long-Lived Assets

The Company reviews its property and equipment and any identifiable intangibles for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable.

The recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset to the future undiscounted operating cash flow expected to be generated by the asset.

If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the asset exceeds the fair value of the asset.

Long-lived assets to be disposed of are reported at the lower of carrying amount or fair value less costs to sell.

During the year ended December 31, 2023, the Company made the strategic decision to allocate fewer resources to our D2C products;

pursuant to this decision, we made the determination that the carrying value of the tradenames held by our subsidiaries iGourmet and Mouth could not be recovered.

Accordingly, the Company recorded impairment charges in the amounts of $ 1,055,400 and $ 260,422 against the tradenames held by iGourmet and Mouth, respectively, reducing the carrying value of these intangible assets to $ 0 .

Cost Method Investments

The Company has made several investments in early stage private food related companies and are accounting for these investments under the cost method.

At December 31, 2022, the Company made the determination that it was unlikely to recover the cost of these investments, and recorded an impairment in the amount of $ 286,725 .

Basic and Diluted Income Per Share

Basic net earnings per share is based on the weighted average number of shares outstanding during the period, while fully diluted net earnings per share is based on the weighted average number of shares of common stock and potentially dilutive securities assumed to be outstanding during the period using the treasury stock method.

Potentially dilutive securities consist of options and warrants to purchase common stock, and convertible debt.

Basic and diluted net loss per share is computed based on the weighted average number of shares of common stock outstanding during the period.

The Company uses the treasury stock method to calculate the impact of outstanding stock options and warrants.

Stock options and warrants for which the exercise price exceeds the average market price over the period have an anti-dilutive effect on earnings per common share and, accordingly, are excluded from the calculation.

Dilutive shares at December 31, 2023:

Stock Options

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, 2023:

Restricted Stock Awards

At December 31, 2023, there are 300,000 unvested restricted stock awards remaining from grants in a prior year.

Those 300,000 restricted stock awards will vest as follows:

125,000 restricted stock awards will vest contingent upon the attainment of a stock price of $2.00 per share for 20 straight trading days , and an additional 175,000 restricted stock awards will vest contingent upon the attainment of a stock price of $3.00 per share for 20 straight trading days .

Stock-based compensation

During the year ended December 31, 2023, the Company charged the amount of $ 293,334 to operations in connection with management stock-based compensation plans.

The Company also charged the amount of $ 112,169 to operations in connection 267,030 shares of common stock granted to three employees as compensation.

Dilutive shares at December 31, 2022:

Stock Options

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:

Restricted Stock Awards

At December 31, 2022, there are 300,000 unvested restricted stock awards remaining from grants in a prior year.

Those 300,000 restricted stock awards will vest as follows:

Stock-based compensation

During the year ended December 31, 2022, the Company incurred obligations to issue the following shares of common stock pursuant to employment agreements:

an aggregate total of 2,149,384 shares of common stock with a market value of $ 561,600 were accrued for issuance to its Chief Executive Officer;

of this amount, 381,036 with a market value of $ 95,414 were withheld for the payment of income taxes, and the net number of shares issuable to the Chief Executive Officer was 1,768,348 with a market value of $ 466,186 .

Also during the period an aggregate total of 103,256 shares of common stock with a market value of $ 40,000 were accrued for issuance to two board members.

These restricted stock grants are being amortized over their vesting periods of one to three years.

During the year ended December 31, 2022, the total amount of $ 506,186 was charged to non-cash compensation and $ 95,414 was charged to cash compensation in connection with these grants.

The Company accounts for leases in accordance with Financial Accounting Standards Board (“FASB”) ASC 842, “Leases”.

Company reviews its property and equipment and any identifiable intangibles for impairment whenever events or changes in circumstances

indicate that the carrying amount of an asset may not be recoverable.

The recoverability of assets to be held and used is measured by

a comparison of the carrying amount of an asset to the future undiscounted operating cash flow expected to be generated by the asset.

If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount

of the asset exceeds the fair value of the asset.

Long-lived assets to be disposed of are reported at the lower of carrying amount or

fair value less costs to sell.

During the year ended December 31, 2023, the Company made the strategic decision to allocate fewer resources

to our D2C products;

pursuant to this decision, we made the determination that the carrying value of the tradenames held by our subsidiaries

igourmet and Mouth could not be recovered.

Accordingly, the Company recorded impairment charges in the amounts of $ 1,055,400 and $ 260,422

against the tradenames held by igourmet and Mouth, respectively, reducing the carrying value of these intangible assets to $ 0 .

and Diluted Income Per Share

net earnings per share is based on the weighted average number of shares outstanding during the period, while fully diluted net earnings

per share is based on the weighted average number of shares of common stock and potentially dilutive securities assumed to be outstanding

during the period using the treasury stock method.

Potentially dilutive securities consist of options and warrants to purchase common

stock, and convertible debt.

Basic and diluted net loss per share is computed based on the weighted average number of shares of common

stock outstanding during the period.

Company uses the treasury stock method to calculate the impact of outstanding stock options and warrants.

Stock options and warrants

for which the exercise price exceeds the average market price over the period have an anti-dilutive effect on earnings per common share

and, accordingly, are excluded from the calculation.

shares at December 31, 2024:

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, 2024:

Exercise Number Contractual

Price of Options Life (years)

$ 1.00 50,000 1.50

$ 1.25 130,000 1.50

$ 1.75 130,000 0.99

$ 1.42 310,000 1.41

December 31, 2024, there are 300,000 unvested restricted stock awards remaining from grants in a prior year.

Those 300,000 restricted

stock awards will vest as follows:

125,000 restricted stock awards will vest contingent upon the attainment of a stock price of $2.00

per share for 20 straight trading days , and an additional 175,000 restricted stock awards will vest contingent upon the attainment of

a stock price of $3.00 per share for 20 straight trading days .

The Company also has in place a share-based incentive

plan for its executive team.

When shares are granted under the Company’s incentive stock plans,

the Company withholds the number of shares required to satisfy income tax withholding requirements on the award, calculated at the market

value of the Company’s stock on the date the award is granted.

the year ended December 31, 2024, the Company charged the amount of $404,804 to operations in connection with management stock-based

compensation plans.

December 31, 2024, there were a total of 1,450,314 shares of common stock which have vested and are issuable pursuant to Executive Stock

Compensation Plans.

shares at December 31, 2023:

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, 2023:

Exercise Number Contractual

Price of Options Life (years)

$ 0.41 125,000 0.32

$ 0.50 125,000 0.32

$ 0.60 50,000 1.99

$ 1.00 50,000 1.99

$ 0.55 350,000 0.80

When shares are granted under the Company’s

stock option, the Company withholds the number of shares required to satisfy income tax withholding requirements on the award, calculated

at the market value of the Company’s stock on the date the options is exercised.

December 31, 2023, there are 300,000 unvested restricted stock awards remaining from grants in a prior year.

Those 300,000 restricted

stock awards will vest as follows:

125,000 restricted stock awards will vest contingent upon the attainment of a stock price of $2.00

per share for 20 straight trading days , and an additional 175,000 restricted stock awards will vest contingent upon the attainment of

a stock price of $3.00 per share for 20 straight trading days .

the year ended December 31, 2023, the Company charged the amount of $ 293,334 to operations in connection with management stock-based

compensation plans.

The Company also charged the amount of $ 112,169 to operations in connection with 267,030 shares of common stock granted

to three employees as compensation.

Company accounts for leases in accordance with Financial Accounting Standards Board (“FASB”) ASC 842, “Leases”.

The Company determines if an arrangement is a lease at inception.

Operating lease right-of-use assets (“ROU assets”) and short-term and long-term lease liabilities are included on the face of the consolidated balance sheet.

Finance lease ROU assets are presented within other assets, and finance lease liabilities are presented within current and long-term liabilities.

ROU assets represent the right of use to an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease.

Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term.

As most of the Company’s leases do not provide an implicit rate, the Company uses an incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments.

Operating lease right-of-use (“ROU”) assets and short-term

and long-term lease liabilities are included on the face of the consolidated balance sheet.

Finance lease ROU assets are presented within

other assets, and finance lease liabilities are presented within current and long-term liabilities.

assets represent the right of use to an underlying asset for the lease term and lease liabilities represent the Company’s obligation

to make lease payments arising from the lease.

Operating lease ROU assets and liabilities are recognized at commencement date based on

the present value of lease payments over the lease term.

As most of the Company’s leases do not provide an implicit rate, the Company

uses an incremental borrowing rate based on the information available at commencement date in determining the present value of lease

The operating lease ROU asset also excludes lease incentives.

The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option.

Lease expense for lease payments is recognized on a straight-line basis over the lease term.

The Company has lease agreements with lease and non-lease components, which are accounted for as a single lease component.

For lease agreements with terms less than 12 months, the Company has elected the short-term lease measurement and recognition exemption, and it recognizes such lease payments on a straight-line basis over the lease term.

New Accounting Pronouncements

Management does not believe that any other recently issued but not yet effective accounting standards, if currently adopted, would have a material effect on the accompanying consolidated financial statements.

The Company’s lease terms may include options to extend

or terminate the lease when it is reasonably certain that the Company will exercise that option.

Lease expense for lease payments is

recognized on a straight-line basis over the lease term.

The Company has lease agreements with lease and non-lease components, which

are accounted for as a single lease component.

For lease agreements with terms less than 12 months, the Company has elected the short-term

lease measurement and recognition exemption, and it recognizes such lease payments on a straight-line basis over the lease term.

Accounting Pronouncements

November 2023, the FASB issued ASU No.

2023-07, “Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures”.

The amendments improve reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses.

The ASU is effective for annual reporting periods beginning after December 15, 2023 and interim periods within fiscal years beginning

after December 15, 2024 with early adoption permitted and can be applied on either a prospective or retroactive basis.

The Company does

not believe the adoption of this guidance will have a material effect on its Consolidated Financial Statements and segment disclosures.

In November 2024, the FASB issued ASU

2024-03, “Disaggregation of Income Statement Expenses (DISE)” which requires disaggregated disclosure of income statement

expenses for public business entities.

The ASU does not change the expense captions an entity presents on the face of the income statement;

rather, it requires disaggregation of certain expense captions into specified categories in disclosures within the footnotes to the financial

ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning

after December 15, 2027.

Early adoption is permitted.

The Company does not believe the adoption of this guidance will have a material

effect on its Consolidated Financial Statements and segment disclosures.

DISCONTINUED OPERATIONS

During the fourth quarter of fiscal 2023, in connection with an analysis of the Company’s sales mix and profitability by service offering, management made the strategic decision to focus on the Company’s Business to Business (B2B) service offering and to allocate fewer resources to and in some cases to sell certain of the Company’s subsidiaries involved in our Direct to Consumer (D2C) service offerings.

Pursuant to this strategy, on December 29, 2023, the Company completed the sales of its Grow and Oasis subsidiaries (see note 3).

In addition, Haley is being held for sale, and the operations of P Innovations will be abandoned.

We have recorded the accounts of these entities pursuant to the guidance of ASC 205-20 and have classified the accounts of these entities as discontinued operations in the Company’s financial statements for the years ended December 31, 2023 and 2022.

The following information presents the major classes of line item of assets and liabilities included as part of discontinued operations in the consolidated balance sheets:

the fourth quarter of fiscal 2023, in connection with an analysis of the Company’s sales mix and profitability by service offering,

management made the strategic decision to focus on the Company’s B2B service offering and to allocate fewer resources to and in

some cases to sell certain of the Company’s subsidiaries involved in its D2C service offerings.

Pursuant to this strategy, on December

29, 2023, the Company completed the sales of its Grow and Oasis subsidiaries;

on February 26, 2024, the Company completed the sale of

its Haley subsidiary;

and on October 8, 2024, the Company sold substantially all of the assets of Mouth (see Note 3).

In addition, the

operations of P Innovations have been abandoned.

following information presents the major classes of line item of assets and liabilities included as part of discontinued operations in

the consolidated balance sheets:

Current assets - discontinued operations:

Accounts receivable

Other current assets

Total current assets - discontinued operations

Total current assets

- discontinued operations

Current liabilities - discontinued operations:

2 unchanged sentences

Deferred revenue

Total current liabilities - discontinued operations

The following information presents the major classes of line items constituting the after-tax loss from discontinued operations in the consolidated statements of operations:

Total current liabilities

- discontinued operations

following information presents the major classes of line items constituting the after-tax loss from discontinued operations in the consolidated

statements of operations:

Cost of goods sold

Selling, general, and administrative expenses

Interest income

Loss from discontinued operations, net of tax

The following information presents the major classes of line items constituting significant operating and investing cash flow activities in the consolidated statements of cash flows relating to discontinued operations:

Other (income) expense

Loss from discontinued

operations, net of tax

$ ( 641,485 )

following information presents the major classes of line items constituting significant operating and investing cash flow activities

in the consolidated statements of cash flows relating to discontinued operations:

Accounts receivable

Accounts payable and accrued liabilities

$ ( 259,345 )

Deferred revenue

$ ( 300,159 )

SALE OF ASSETS

February 14, 2024, the Company sold its property located at 28411 Race Track Road, Bonita Springs, Florida, for net cash proceeds of

$ 2,101,185 , net of the payoff of principal and interest in the amount of $ 356,215 on Maple Mark Term Loan 2.

A gain in the amount of

$ 1,807,516 was recorded on this transaction.

August 30,2024, the Company sold certain intangible assets of igourmet including but not limited to copyrights, trademarks, tradenames,

and customer lists for net cash proceeds of $ 617,000 .

The buyer also assumed certain liabilities in the net amount of $ 309,463 .

in the amount of $ 834,463 was recorded on this transaction.

October 8, 2024, we sold substantially all of the assets of Mouth including copyrights, trademarks, tradenames, and customer lists;

assets were fully amortized at the time of the sale.

In addition, the buyer assumed the liability for deferred revenue in the amount

of $ 174,637 .

A gain in the amount of $ 174,637 was recorded on this transaction.

SALE OF SUBSIDIARIES

On December 29, 2023, the Company sold 100 % of the equity interests in Organic Food Brokers, LLC (“OFB, GROW”) and Oasis Sales Corp.

December 29, 2023, the Company sold 100 % of the equity interests in Organic Food Brokers, LLC (“OFB” or “GROW”)

and Oasis Sales Corp.

(“Oasis”) 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.

The Company recorded a loss in the amount

of $ 45,022 on this transaction.

February 26, 2024, the Company sold 100 % of the equity interests in Haley for the return of 21,126 shares of the Company’s

common stock held by the buyer.

Haley had no assets or liabilities at the time of the sale.

The Company valued the 21,126 shares

of common stock at the market price on the date of the acquisition of $ 1.00 per sale and recorded a gain in the amount of $ 21,126 on

this transaction.

Organics, Inc.

On October 14, 2024, the

Company entered into an asset purchase agreement (the “GO APA”) with Golden Organics, Inc., a wholesaler of bulk organic and

other related food products.

Pursuant to the GO APA, the Company acquired substantially all the properties, business, and assets of Golden

Organics, Inc.

for an aggregate purchase price of $ 1,580,000 , subject to net accounts receivable and accounts payable adjustments.

Company accounted for the GO APA pursuant to the guidance of ASC 805 – Accounting for Business Combinations (“ASC 805”).

The $ 1,580,000 purchase price consisted of a cash payment of $ 1,230,000 at closing and a promissory note in the amount of $ 350,000 bearing

interest at the rate of 6 % per annum and payable in 60 equal monthly installments.

At December 31, 2024, the Company had made cash payments

in the aggregate amount of $ 1,231,379 on the GO APA and recorded ROU operating assets and liabilities of $ 731,566 ;

intangible assets of

property and equipment of $ 131,250 ;

accounts receivable of $ 611,132 ;

inventory of $ 1,102,536 , and other current assets of $ 84,000 ;

accounts payable of $ 546,132 ;

and note payable of $ 350,000 .

On December 20, 2024,

the Company through its subsidiary, Golden Organics, Inc., entered into an asset purchase agreement (the “LoCo APA”) with

LoCo Food Distribution LLC, a Colorado limited liability company (“LoCo”), a wholesaler of food related products, and Elizabeth

Mozer and Benjamin Mozer (each an “Owner,” collectively, the “Owners” and together with LoCo, collectively,

the “Seller Parties”).

The Company accounted for the LoCo APA pursuant to the guidance of ASC 805.

Pursuant to the LoCo APA,

the Company acquired substantially all of LoCo’s properties, business, and assets used and/or useful in the operation of LoCo’s

business of sourcing and wholesaling food products, and agreed to assume certain liabilities of LoCo for an aggregate purchase price of

$ 304,269 , which is payable to LoCo’s lenders for all outstanding and unpaid indebtedness of LoCo.

The Company also entered into

an earnout agreement with LoCo in the amount of $ 53,430 , payable by Golden Organics to the Owners based upon twelve month revenue and

earnings targets.

The Company expects these targets to be met.

At December 31, 2024, the Company had recorded the following assets and

liabilities pursuant to the LoCo APA:

Cash received of $ 42,000 ;

intangible assets of $ 232,972 ;

property and equipment of $ 252,000 ;

payable and accrued liabilities of $ 1,008,590 ;

and contingent liability payable of $ 54,430 .

ACCOUNTS RECEIVABLE

At December 31, 2023 and 2022, accounts receivable consists of:

December 31, 2024 and 2023, accounts receivable consisted of:

Accounts receivable from customers

Allowance for credit losses

Accounts receivable, net

During the years ended December 31, 2023 and 2022, the Company charged (recovered) the amount of $ 73,330 and $( 1,915 ), respectively, to bad debt expense.

Inventory consists of specialty food products.

Accounts receivable,

the years ended December 31, 2024 and 2023, the Company charged the amount of $ 4,599 and $ 73,330 , respectively, to bad debt expense.

consists of specialty food products.

At December 31, 2024 and 2023, inventory consisted of the following:

Finished goods inventory

Allowance for slow moving & obsolete inventory

Finished goods inventory, net

Allowance for slow moving

& obsolete inventory

Finished goods inventory,

PROPERTY AND EQUIPMENT

A summary of property and equipment at December 31, 2023 and 2022 is as follows:

summary of property and equipment at December 31, 2024 and 2023 is as follows:

Computer and Office Equipment

3 unchanged sentences

accumulated depreciation

Depreciation expense for property and equipment amounted to $ 392,354 and $ 379,632 for the years ended December 31, 2023 and 2022, respectively, which is recorded in selling, general & administrating expenses on the Company’s statement of operations.

During the year ended December 31, 2023, the Company disposed of a vehicle with a cost of $ 51,091 and accumulated depreciation of $ 49,380 .

( 1,636,367 )

( 2,725,230 )

expense for property and equipment amounted to $ 173,021 and $ 392,354 for the years ended December 31, 2024 and 2023, respectively, which

is recorded in selling, general & administrating expenses on the Company’s statement of operations.

During the year ended December

31, 2024, the Company disposed of a vehicle with a cost of $ 51,091 and accumulated depreciation of $ 49,380 .

PROPERTY AND EQUIPMENT CLASSIFIED AS HELD FOR SALE

Assets held for sale include the net book value of property and equipment the Company plans to sell within the next year.

Long lived assets that meet the criteria are held for sale and reported at the lower of their carrying value or fair value less estimated cost to sell.

As of December 31, 2023, the Company classified the land, building, leasehold improvements, and certain equipment located at 28411 Race Track Road, Bonita Springs, Florida, 34135.

These net book value of these assets consisted of the following at December 31, 2023:

Furniture, fixtures, and equipment

RIGHT OF USE ( “ ROU ” ) ASSETS AND LEASE LIABILITIES – OPERATING LEASES

The Company has operating leases for offices, warehouses, vehicles, and office equipment.

The Company’s leases have remaining lease terms of 1 year to 3 years, some of which include options to extend.

The Company’s lease expense for the years ended December 31, 2023 and December 31, 2022 was entirely comprised of operating leases and amounted to $ 58,915 and $ 78,849 , respectively.

The Company’s ROU asset amortization for the years ended December 31, 2023 and December 31, 2022 was $ 51,756 and $ 66,740 , respectively.

The difference between the lease expense and the associated ROU asset amortization consists of interest.

Right of use assets – operating leases are summarized below:

December 31, 2023

December 31, 2022

held for sale include the net book value of property and equipment the Company plans to sell within the next year.

Long lived assets

that meet the criteria are held for sale and reported at the lower of their carrying value or fair value less estimated cost to sell.

of December 31, 2023, the Company classified the land, building, leasehold improvements, and certain equipment located at 28411 Race

Track Road, Bonita Springs, Florida, 34135 (the “Race Track Road Property”) as held for sale.

On February 14, 2024, the Company

finalized the sale of the Race Track Road Property for cash in the amount of $ 2,455,000 .

The Company recorded a gain on the sale in the

amount of $ 1,807,516 .

Proceeds of the sale in the amount of $ 353,815 were used to pay the mortgage and accrued interest on the Race Track

Road Property.

Total expenses related to the sale were $ 165,755 , including a commission of $ 147,300 , state taxes of $ 17,185 , and closing

fees of $ 1,270 .

of December 31, 2024, the Company classified the land and building located at 220 Oak Hill Road, Mountain Top, Pennsylvania, as held

The net book value of these assets consisted of the following at December 31, 2024 and 2023:

Furniture, fixtures, and

RIGHT OF USE ASSETS AND LEASE LIABILITIES – OPERATING LEASES

Company has operating leases for offices, warehouses, vehicles, and office equipment.

The Company’s leases have remaining lease

terms of 1 year to 3 years, some of which include options to extend.

Company’s lease expense for the years ended December 31, 2024 and December 31, 2023 was entirely comprised of operating leases

and amounted to $ 62,686 and $ 58,915 , respectively.

The Company’s ROU asset amortization for the years ended December 31, 2024 and

2023 was $ 54,609 and $ 51,756 , respectively.

The difference between the lease expense and the associated ROU asset amortization consists

of use assets – operating leases are summarized below:

Warehouse equipment

Office equipment

Right of use assets, net

Operating lease liabilities are summarized below:

December 31, 2023

December 31, 2022

Right of use assets,

lease liabilities are summarized below:

Warehouse equipment

3 unchanged sentences

Lease liability, non-current

Maturity analysis under these lease agreements are as follows:

analysis under these lease agreements are as follows:

Year ended December 31, 2025

Year ended December 31, 2026

Year ended December 31, 2027

Year ended December 31, 2028

Year ended December 31, 2029

Present value discount

Lease liability

During the year ended December 31, 2023, the Company recorded the removal of a right of use asset and lease liability in the amount of $ 72,150 due to the termination of an office lease.

During the year ended December 31, 2022, the Company recorded the removal of a right to use asset and lease liability in the amount of $ 13,216 due to damage to the asset.

the year ended December 31, 2024, the Company recorded an operating lease of a building in the amount of $ 599,116 and an operating lease

of vehicles in the amount of $ 132,451 in connection with the acquisition of Golden Organics.

During the year ended December 31, 2023,

the Company recorded the removal of a right to use asset and lease liability in the amount of $ 72,150 due to the termination of an office

RIGHT OF USE ASSETS – FINANCING LEASES

The Company has financing leases for vehicles and warehouse equipment.

(See note 15.) Right of use asset – financing leases are summarized below:

Company has financing leases for vehicles and warehouse equipment.

Right of use asset – financing leases are summarized

Warehouse Equipment

1 unchanged sentence

accumulated depreciation

Depreciation expense on right of use assets for the years ended December 31, 2023 and 2022 was $ 133,920 and $ 141,216 , respectively.

During the year ended December 31, 2022 the Company recorded right of use assets and lease liabilities in the amount of $ 42,500 due to the execution of new financing lease agreements.

Financing lease liabilities are summarized below:

expense on right of use assets for the years ended December 31, 2024 and 2023 was $ 92,870 and $ 133,920 , respectively.

During the year

ended December 31, 2024, the Company recorded right of use assets and lease liabilities in the amount of $ 180,740 related to warehouse

lease liabilities are summarized below:

Financing lease obligation under a lease agreement for a forklift dated July 12, 2021 in the original amount of $ 16,070 payable in thirty-six monthly installments of $489 including interest at the rate of 6.01 %.

7 unchanged sentences

During the year ended December 31, 2023, the Company made principal and interest payments on this lease obligation in the amount of $ 104,019 and $ 15,289 , respectively.

$ 87,278 $ 197,707

Financing lease obligation under a lease agreement for a truck dated March 31, 2020 in the original amount of $ 152,548 payable in eighty-four monthly installments of $2,188 including interest at the rate of 5.44 %.

1 unchanged sentence

During the year ended December 31, 2023, the Company made principal and interest payments on this lease obligation in the amounts of $ 21,467 and $ 4,788 , respectively.

$ 53,549 $ 76,218

Financing lease obligation under a lease agreement for a truck dated November 5, 2018 in the original amount of $ 128,587 payable in seventy monthly installments of $2,326 including interest at the rate of 8.33 %.

4 unchanged sentences

During the year ended December 31, 2023, the Company made principal and interest payments on this lease obligation in the amounts of $ 11,787 and $ 1,988 , respectively.

$ 20,929 $ 33,322

Financing lease obligation under a lease agreement for a truck dated February 4, 2022 in the original amount of $ 42,500 payable in twenty-four monthly installments of $1,963 including interest at the rate of 10.1 %.

1 unchanged sentence

During the year ended December 31, 2023, the Company made principal and interest payments on this lease obligation in the amounts of $ 20,032 and $ 1,564 , respectively.

Financing lease obligation under a lease agreement for warehouse equipment dated September 12, 2024 in the original amount of $ 180,740 payable in sixty monthly payments in the minimum amount of $2,846 including interest at the rate of 6.01 %.

The amount of the monthly payments is based upon the amount of supplies and materials the Company purchases from the lessor each month.

During the year ended December 31, 2024, the Company made principal and interest payments on this lease obligation in the amounts of $ 55,108 and $ 2,154 , respectively.

Total $ 287,388 $ 335,004

Current portion $ 147,797 $ 115,738

Long-term maturities 139,591 219,266

Aggregate maturities of lease liabilities – financing leases as of December 31, 2023 are as follows:

For the year ended December 31,

Total $ 287,388 $ 335,004

maturities of lease liabilities – financing leases as of December 31, 2024 are as follows:

the year ended December 31,

INTANGIBLE ASSETS

The Company acquired certain intangible assets pursuant to the acquisitions through Artisan, Oasis, igourmet, OFB, Haley, and M Innovations.

Company acquired certain intangible assets pursuant to the acquisitions through Artisan, Oasis, igourmet, OFB, Haley, and M Innovations.

These assets include non-compete agreements, customer relationships, trade names, internally developed technology, and goodwill.

The Company has also capitalized the development of its website.

Other Amortizable Intangible Assets

Other amortizable intangible assets consist of $ 1,055,400 of trade names held by igourmet, $ 260,422 of trade names held by Mouth, and $ 217,000 of trade names held by Artisan.

The Company followed the guidance of ASC 360 “Property, Plant, and Equipment” (“ASC 360”) in assessing these assets for impairment.

ASC 360 states that impairment testing should be completed whenever events or changes in circumstances indicate the asset’s carrying value may not be recoverable.

During the year ended December 31, 2023, the Company made the strategic decision to allocate fewer resources to our D2C products;

pursuant to this decision, we made the determination that it was unlikely that the carrying value of tradenames held by igourmet in the amount were recoverable.

Accordingly, we recorded impairments to these assets in the amounts of $ 1,055,400 and $ 260,422 , respectively.

The Company acquired certain intangible assets pursuant to the acquisitions through Artisan, Oasis, igourmet, OFB, Haley, and M Innovations.

The following is the net book value of these intangible assets:

December 31, 2023

Internally Developed Technology

December 31, 2022

Internally Developed Technology

The trade names are not considered finite-lived assets and are not being amortized.

Company has also capitalized the development of its website.

Amortizable Intangible Assets

August 6, 2024, the Company signed an agreement to sell intangible assets of its consumer e-commerce business igourmet, generally consisting

of customer lists, domains, and trademarks for cash of $ 700,000 .

The purchase price was $ 947,650 , consisting of the following:

received cash of $ 617,000 .

The buyer also assumed liabilities of $ 330,650 .

The intangible assets sold were fully amortized on the

Company’s balance sheet, and the Company recognized a gain on the sale of $ 834,463 , net of acquisition costs in the amount

of $ 113,187 .

October 14, 2024, the Company acquired certain assets of Goldan Organics, Inc.

(the “GO Transaction”).

to the GO Transaction, the Company recorded an intangible asset in the amount of $ 198,593 representing the client base of Golden Organics.

On December 19, 2024, the Company acquired, through its subsidiary Golden Organics, Inc., certain assets of LoCo Food Distribution, LLC

(the “LoCo Transaction”).

Pursuant to the LoCo Transaction, the Company recorded an intangible asset in

the amount of $ 232,972 representing a customer list.

The total amount of intangible assets obtained in the GO and LOCO transactions was

This amount if being amortized over a period of 60 months.

amortization expense for the years ended December 31, 2024 and 2023 was $ 7,193 and $ 0 , respectively.

Non-Amortizable Intangible Assets

non-amortizable intangible assets consist of $ 217,000 of trade names held by Artisan.

The Company followed the guidance of ASC 360, Property,

Plant, and Equipment , in assessing these assets for impairment.

ASC 360 states that impairment testing should be completed whenever

events or changes in circumstances indicate the asset’s carrying value may not be recoverable.

In management’s judgment,

there are no indications that the carrying value of these trade names may not be recoverable, and it determined that impairment testing

was not required.

Company acquired certain intangible assets pursuant to the acquisitions through Artisan.

The following is the net book value of these

ACCOUNTS PAYABLE AND ACCRUED LIABILITIES

Accounts payable and accrued liabilities at December 31, 2023 and December 31, 2022 are as follows:

payable and accrued liabilities at December 31, 2024 and December 31, 2023 are as follows:

Trade payables and accrued liabilities

1 unchanged sentence

ACCRUED SEPARATION COSTS – RELATED PARTIES

On February 3, 2023, the Company entered into a Severance Note, an Agreement and General Release, and a Side Letter thereto with Sam Klepfish (the “SK Agreements”), its prior CEO and a current board member.

February 3, 2023, the Company entered into a Severance Note, an Agreement and General Release, and a Side Letter thereto with Sam Klepfish

(the “SK Agreements”), its prior CEO and a current board member.

The SK Agreements provide, among other things, for Mr.

Kelpfish’s resignation from all positions with the Company and its subsidiaries on February 28, 2023, except that Mr.

Klepfish will remain a director and member of the board of the Company, confidentiality and non-disparagement conditions, nomination of Mr.

Klepfish for future election to the board of directors at least through the 2024 general meeting of shareholders based on certain minimum stock ownership and Board Observer rights when Mr.

resignation from all positions with the Company and its subsidiaries on February 28, 2023, except that Mr.

Klepfish will remain a director

and member of the board of the Company, confidentiality and non-disparagement conditions, nomination of Mr.

Klepfish for future election

to the board of directors at least through the 2024 general meeting of shareholders based on certain minimum stock ownership and Board

Observer rights when Mr.

Klepfish is no longer a director but maintains certain minimum agreed upon stock ownership.

The payment terms are $ 250,000 upon effectiveness and an additional $ 1,000,000 payable in weekly payments of $ 6,410.26 from March 8, 2023 through March 6, 2026.

The payment terms

are $ 250,000 upon effectiveness and an additional $ 1,000,000 payable in weekly payments of $ 6,410.26 from March 8, 2023 through March

The $250,000 was paid into an escrow account with the requirement that they are released to Mr.

1 unchanged sentence

The $1,000,000 portion is in the form of an unsecured, non interest-bearing note payable to Mr.

The SK Agreements also call for the delivery of 400,000 shares of the Company’s common stock valued at $ 168,000 based upon the closing price of the Company’s common stock on Mr.

Klepfish’s separation date of February 28, 2023 (see note 16);

in addition, for delivery on June 1, 2027 of additional shares of the Company’s common stock equal to the greater of (i) the number of shares with an aggregate fair market value of $ 400,000 on such date, or (ii) 266,666 shares.

The SK Agreements also call

for the delivery of 400,000 shares of the Company’s common stock valued at $ 168,000 based upon the closing price of the Company’s

common stock on Mr.

Klepfish’s separation date of February 28, 2023;

in addition, for delivery on June 1, 2027 of additional shares

of the Company’s common stock equal to the greater of (i) the number of shares with an aggregate fair market value of $ 400,000

on such date, or (ii) 266,666 shares.

The Company also agreed to pay a total of $ 1,199 of Cobra insurance costs on behalf of Mr.

Klepfish over eighteen months.

over eighteen months.

The total amount accrued in connection with the SK Agreements was $ 1,819,199 .

On February 28, 2023, the Company entered into a separation agreement (the “Wiernasz Separation Agreement”) with Justin Wiernasz, its prior director and previous Director of Strategic Acquisitions.

Pursuant to the Wiernasz Separation Agreement, the Company agreed to a payment of $ 100,000 in cash as follows:

February 28, 2023, the Company entered into a separation agreement (the “Wiernasz Separation Agreement”) with Justin Wiernasz,

its prior director and previous Director of Strategic Acquisitions.

Pursuant to the Wiernasz Separation Agreement, the Company agreed

to a payment of $ 100,000 in cash as follows:

$ 33,333 upon execution of the agreement, $ 33,333 on March 15, 2023, and $ 33,334 on April

The Company also agreed to make the Cobra insurance payments on behalf of Mr.

Wiernasz in the amount of $ 2,548 per month for twelve months with a maximum of $ 26,451 .

Wiernasz in the amount of $ 2,548 per month for

twelve months with a maximum of $ 26,451 .

The total amount accrued in connection with the Wiernasz Separation Agreement was $ 126,451 .

On February 6, 2024, the Company entered into a separation agreement with Richard Tang, its Chief Financial Officer (the “Tang Separation Agreement”) effective as of December 31, 2023.

February 6, 2024, the Company entered into a separation agreement with Richard Tang, its Chief Financial Officer (the “Tang Separation

Agreement”) effective as of December 31, 2023.

Pursuant to the Tang Separation Agreement, the Company will pay to Mr.

Tang, in equal installments over a five month period, the gross sum of $ 113,918 .

equal installments over a five month period, the gross sum of $ 113,918 .

In addition, Mr.

Tang may submit for reimbursement up to $ 4,000 of legal expenses connected with the review of this separation agreement.

Tang may submit for reimbursement up to $ 4,000

of legal expenses connected with the review of this separation agreement.

The severance payment will be made in the following installments:

(i) $ 25,890 to be paid the week of March 4, 2024;

(ii) $ 5,178 to be paid each successive week for seventeen weeks beginning the week of March 11, 2024, until the Severance Payment is completed.

In addition, if Tang timely elects to continue his group health insurance benefits under the Consolidated Omnibus Reconciliation Act (“COBRA”), the Company will reimburse Tang’s group health insurance premiums (“COBRA Premiums”) for the lesser of:

(a) the period of time Employee is eligible to continue his group health insurance benefits under COBRA and (b) the five-month period immediately following the Separation Date.

Reimbursements will be paid within thirty days of when Tang submits a request for reimbursement and supporting documentation.

During the year ended December 31, 2023, the Company made the following payments in connection with the SK Agreements:

The Company paid cash in the amount of $ 525,643 to Mr.

Klepfish and made Cobra payments on behalf of Mr.

Klepfish in the amount of $ 200 .

The Company also issued 400,000 shares of common stock with a fair value of $ 168,000 .

During the year ended December 31, 2023, the Company made the following payments in connection with the Wiernasz Separation Agreement:

The Company paid cash in the amount of $ 100,000 and made Cobra payments on behalf of Mr.

(ii) $ 5,178 to be paid each successive week for seventeen weeks beginning the week

of March 11, 2024, until the Severance Payment is completed.

In addition, if Mr.

Tang timely elects to continue his group health insurance

benefits under the Consolidated Omnibus Reconciliation Act (“COBRA”), the Company will reimburse Mr.

Tang’s group health

insurance premiums (“COBRA Premiums”) for the lesser of:

(a) the period of time Employee is eligible to continue his group

health insurance benefits under COBRA and (b) the five-month period immediately following the Separation Date.

Reimbursements will be

paid within thirty days of when Mr.

Tang submits a request for reimbursement and supporting documentation.

the year ended December 31, 2024, the Company made the following payments in connection with the SK Agreements:

The Company paid cash

in the amount of $333,333 to Mr.

the year ended December 31, 2024, the Company made the following payments in connection with the Wiernasz Separation Agreement:

made Cobra payments on behalf of Mr.

Weirnasz in the amount of $ 967 .

During the year ended December 31, 2023, the Company did not make any payments in connection with the Tan Separation Agreement.

The following table represents the amounts accrued, paid, and outstanding on these agreements as of December 31, 2023:

Paid / Issued

the year ended December 31, 2024, the Company made the following payments in connection with the Tang Separation Agreement:

made cash payments to Mr.

Tang in the amount of $ 113,918 , and Cobra payments on behalf of Mr.

Tang in the amount of $ 14,495 .

following table represents the amounts accrued, paid, and outstanding on these agreements as of December 31, 2024:

Cash – through March 6, 2026

$ ( 608,975 )

Cash - upon agreement execution

1 unchanged sentence

Stock - Issued in April 2023

Cobra - over eighteen months

Cobra - over eighteen

$ ( 1,026,975 )

Cash - three equal payments

Cobra - over eighteen months

$ ( 100,000 )

Cobra - over eighteen

$ ( 126,451 )

Cash – over seventeen weeks

$ ( 113,918 )

Cobra - over five months

$ ( 128,413 )

Total Company

$ ( 1,281,839 )

STOCK APPRECIATION RIGHTS LIABILITY

Effective May 15, 2023, the Company issued 1,500,000 stock appreciation rights (the “Smallwood SARs”) to Brady Smallwood, its Chief Operating Officer.

The Smallwood SARs were valued utilizing the Black-Scholes valuation model, and had an aggregate fair value of $ 9,794 upon issuance;

this amount was charged to operations and credited to stock appreciation rights liability.

The Smallwood SARs are revalued each quarter, and any gain or loss in the fair value is charged to non-cash compensation expense.

Effective May 15, 2023, the Company issued 1,500,000

stock appreciation rights (the “Smallwood SARs”) to Brady Smallwood, its Chief Operating Officer.

The Smallwood SARs were

valued utilizing the Black-Scholes valuation model, and had an aggregate fair value of $ 9,794 upon issuance;

this amount was charged to

operations and credited to stock appreciation rights liability.

The Smallwood SARs are revalued each quarter, and any gain or loss in

the fair value is charged to non-cash compensation expense.

At December 31, 2024, the Smallwood SARs had a fair value of $ 1,353,150 ;

the increase in fair value in the amount $ 245,226 was charged to non-cash compensation during the year ended December 31, 2023.

REVOLVING CREDIT FACILITIES

On June 6, 2022, the Company entered into a revolving credit facility (the “MapleMark Revolver”) with MapleMark Bank ("MapleMark”) in the initial amount of $ 2,014,333 .

The borrowing base amount is based upon 80% of eligible accounts receivables and 60% of eligible inventory.

This amount was paid by MapleMark directly to Fifth Third Bank in satisfaction of the Fifth Third Bank Line of Credit.

Any amounts borrowed under the MapleMark Revolver will bear interest at the greater of (a) the Base Rate (the rate of interest per annum quoted in the “Money Rates” section of The Wall Street Journal from time to time and designated as the “Prime Rate”) plus 0.25% per annum and (b) 3.50% per annum.

At December 31, 2023, the interest rate was 8.50 %.

The MapleMark Revolver originally was due to mature on May 27, 2023.

The Company applied for a USDA Guarantee and on June 9, 2023, this guarantee was approved.

At this time, the Revolver was expanded to $ 3,000,000 and its term extended to May 27, 2024.

The MapleMark Revolver contains certain negative covenants.

During the years ended December 31, 2023 and 2022, the Company paid interest in the amount of $ 115,429 and $ 71,145 , respectively, on the MapleMark Revolver.

During the year ended December 31, 2023, the Company made a principal payment in the amount of $ 2,014,333 on the MapleMark Revolver.

At December 31, 2023, this loan has been fully satisfied.

The amount of $ 2,014,333 is available to the Company under the MapleMark Revolver at December 31, 2023.

increase in fair value in the amount $ 1,098,130 was charged to non-cash compensation during the year ended December 31, 2024.

following assumption were utilized in the valuation of the Smallwood SARs:

Black-Scholes model variables:

86.58 - 131.55 %

53.3 - 95.5 %

Risk-free interest rates

3.66 - 4.71 %

3.67 - 5.03 %

NOTES PAYABLE

On June 6, 2022, the Company entered into a term loan agreement with MapleMark (the “MapleMark Term Loan 1”) for the original amount of $ 5,324,733 .

This amount was paid by MapleMark directly to Fifth Third Bank in satisfaction of the outstanding principal and interest due under existing loans with Fifth Third Bank.

Amounts outstanding under the Term Loans accrued interest at the rate equal to the lesser of (a) the Maximum Lawful Rate, or (b) the greater of (i) WSJP (the “Prime Rate” as published by The Wall Street Journal) plus 1.25% per annum or (ii) 4.50% per annum.

At December 31, 2022, the interest rate was 8.75 %.

The MapleMark loan was originally due to mature on May 27, 2023 .

and in the event United States Department of Agriculture issues a guarantee of repayment of the MapleMark loan in favor of the Company pursuant to its Business and Industry Loan Guarantee Program (the “USDA Guarantee”), at the Company’s option, the amount of the MapleMark loan can be expanded to $7,420,000.

Upon approval of the USDA Loan Guarantee on June 9, 2023, the Company refinanced its term loans with MapleMark Bank.

On June 14, 2023, the Company paid the principal and interest due on the MapleMark Term Loan 1 in the amount of $ 5,324,733 and $ 61,715 , respectively, with proceeds of the MapleMark Term Loan 3 (see below).

The Maple Mark Term Loan 1 contains negative covenants that, subject to certain exceptions, limits the ability of the Company and its subsidiaries to, among other things, incur additional indebtedness, make restricted payments, pledge their assets as security, make investments, loans, advances, guarantees and acquisitions, undergo fundamental changes and enter into transactions with affiliates.

The Term Loan Agreements also provides that the Company and its subsidiaries on a consolidated basis, meet a Fixed Charge Coverage Ratio as described in detail in the Loan Agreements.

The Term Loan Agreements contain events of default that are customary for a facility of this nature, including (subject in certain cases to grace periods and thresholds) nonpayment of principal, nonpayment of interest, fees or other amounts, material inaccuracy of representations and warranties, violation of covenants, cross-default to certain other existing indebtedness, bankruptcy or insolvency events, and certain judgment defaults as specified in the Term Loan Agreements.

If an event of default occurs, the maturity of the amounts owed under the Term Loan Agreements may be accelerated.

The obligations under the Term Loan Agreements are guaranteed by the Company and IFP and are secured by mortgages on their real estate located in Florida, Illinois, and Pennsylvania and substantially all of their assets, in each case, subject to certain exceptions and permitted liens.

The Company recorded a discount to this loan in the amount of $ 57,106 in connection with financing costs which was amortized to interest expense during the year ended December 31, 2022.

During the year ended December 31, 2023, the Company accrued interest in the amount of $ 221,176 on the MapleMark Term Loan 1.

At December 31, 2023, this loan has been fully satisfied.

2024 December 31,

On June 13, 2023, the Company entered into a term loan with MapleMark Bank (the “MapleMark Term Loan 3”) in the amount of $ 9,057,840 .

14 unchanged sentences

At December 31, 2024, accrued interest on this note was $ 72,273 .

$ 8,895,112 $ 8,985,642

2024 December 31,

On June 6, 2022, the Company entered into a term loan agreement with MapleMark (the “MapleMark Term Loan 2”) for the original amount of $ 356,800 .

9 unchanged sentences

The Company recorded a discount to this loan in the amount of $ 23,367 in connection with financing costs which was amortized to interest expense during the year ended December 31, 2023.

During the year ended December 31, 2023, the Company made principal payments in the amount of $ 3,895 on this loan.

During the year ended December 31, 2023, the Company accrued interest in the amount of $ 27,134 on this loan.

At December 31, 2023, accrued interest on this note was $ 2,018 .

On February 14, 2024, The Company sold its Race Track Road Facility in Bonita Springs, Florida, which had been pledged as security for the MapleMark Term Loan 2.

Proceeds from the sale in the amount of $ 352,905 and $ 910 were used to pay the remaining principal and interest, respectively, on the MapleMark Term Loan 2.

At December 31, 2024, there were no amounts due under the MapleMark Term Loan 2.

$ - $ 352,905

A note payable in the amount of $ 20,000 .

2 unchanged sentences

At December 31, 2024, accrued interest on this note was $ 18,860 .

Vehicle acquisition loan dated December 6, 2018 in the original amount of $ 51,088 , payable in sixty monthly installments of $ 955 including interest at the rate of 4.61 % maturing November 5, 2023 .

During the year ended December 31, 2023, the Company made principal and interest payments in the amount of $ 10,267 and $ 228

$ 20,000 $ 20,000

A note payable in the amount of $ 350,000 issued in connection with the GO Acquisition ( the GO Note”).

The GO Note is payable in 60 equal monthly instalments of $6,766 and bears interest at the rate of 6.0 %.

During the year ended December 31, 2024, the Company made principal and interest payments on the GO note in the amount of $ 5,016 and $ 1,750 , respectively.

$ 344,984 $ -

Total $ 9,260,096 $ 9,358,547

Discount ( 377,370 ) ( 382,506 )

Net of discount $ 8,882,726 $ 8,976,041

1 unchanged sentence

Long-term maturities 8,692,674 8,855,000

There was a total of $ 95,942 and $ 18,104 accrued interest on notes payable at December 31, 2023 and 2022, respectively.

Aggregate maturities of notes payable as of December 31, 2023 are as follows:

For the period ended December 31,

At December 31, 2023 and 2022 a total of 2,823,171 and 2,837,580 shares, respectively, were issued but deemed not outstanding by the Company.

For the year ended December 31, 2023:

On February 1, 2023, the Company issued 875,000 shares of common stock, net of 207,839 shares withheld for income taxes, to its previous Chief Financial Officer compensation.

These shares were previously accrued and were carried on the Company’s balance sheet as common stock to be issued.

On February 28, 2023, the Company issued 267,030 shares with a value of $ 112,169 to three employees as compensation.

On March 31, 2023, the Company accrued the issuance of 207,274 shares of common stock with a value of $ 45,680 to its then officers and directors for compensation.

Total $ 8,882,726 $ 8,976,041

was a total of $ 91,347 and $ 95,942 accrued interest on notes payable at December 31, 2024 and 2023, respectively.

maturities of notes payable as of December 31, 2024 are as follows:

the period ended December 31,

of December 31, 2024 and 2023 a total of 2,844,297 and 2,823,171 shares, respectively, were issued but deemed not outstanding by the

the year ended December 31, 2024:

February 26, 2024, the Company sold 100 % of the equity interests in Haley for the return of 21,126 shares of the Company’s common

stock held by the buyer (see Note 4).

Haley had no assets or liabilities at the time of the sale;

the Company valued the 21,126 shares

of common stock at the market price on the date of the acquisition of $ 1.00 per sale and recorded a gain in the amount of $ 21,126 on

this transaction.

May 30, 2024, the Company issued a net amount of 24,138 shares of common stock pursuant to the cashless exercise of 50,000 options by

a previous CFO at an exercise price of $ 0.60 per shares.

There was no gain or loss on this transaction because the shares were issued

at the fair value of $ 1.16 per share.

On July 9, 2024, the Company issued a total of 1,415,544

shares of common stock pursuant to the Company’s executive stock plans.

These shares were recorded at the aggregate par value of

there was no gain or loss recorded on these transactions as the shares were issued pursuant to the terms of the compensation plans.

November 29, 2024, the Company sold 1,906,250 shares of common stock and on December 4, 2024 the Company sold an additional 125,000 shares

of common stock (a total of 2,031,250 shares) at a price of $ 1.60 per share for total proceeds of $ 3,250,000 .

December 31, 2024, the Company issued the following shares pursuant to executive stock plans:

517,429 shares of common stock were issued

to its CEO, net of 455,991 shares withheld for the payment of taxes in the amount of $ 664,431 ;

133,631 shares of common stock were issued

to its COO, net of 112,151 shares withheld for the payment of taxes in the amount of $ 163,763 ;

and 73,735 shares were issued to its CFO,

net of 57,350 shares withheld for the payment of taxes in the amount of $ 80,290 .

the year ended December 31, 2023:

February 1, 2023, the Company issued 875,000 shares of common stock, net of 207,839 shares withheld for income taxes, to its previous

Chief Financial Officer compensation.

These shares were previously accrued and were carried on the Company’s balance sheet as common

stock to be issued.

February 28, 2023, the Company issued 267,030 shares with a value of $ 112,169 to three employees as compensation.

March 31, 2023, the Company accrued the issuance of 207,274 shares of common stock with a value of $ 45,680 to its then officers and directors

for compensation.

These shares were recorded to common stock to be issued.

On April 26, 2023, the Company issued 400,000 shares of common stock to the previous Chief Executive Officer pursuant to the SK Agreements.

On June 30, 2023, the Company accrued the issuance of 15,106 shares of common stock with a value of $ 5,000 to two directors for compensation.

April 26, 2023, the Company issued 400,000 shares of common stock to the previous Chief Executive Officer pursuant to the SK Agreements.

June 30, 2023, the Company accrued the issuance of 15,106 shares of common stock with a value of $ 5,000 to two directors for compensation.

These shares were recorded to common stock to be issued.

On July 7, 2023, the Company issued 178,626 shares of common stock to a designee of its previous Chief Executive Officer as compensation.

These shares were previously accrued and were carried on the Company’s balance sheet as common stock to be issued.

On August 31, 2023, the Company issued 14,754 shares of common stock to its previous Director of Strategic Acquisitions as compensation.

These shares were previously accrued and were carried on the Company’s balance sheet as common stock to be issued.

On September 6, 2023, the Company issued 236,810 shares of common stock to a board member as compensation.

These shares were previously accrued and were carried on the Company’s balance sheet as common stock to be issued.

On September 6, 2023, the Company issued 222,401 shares of common stock, net of 14,409 shares owed to the Company from a previous transaction to a board member as compensation.

These shares were previously accrued and were carried on the Company’s balance sheet as common stock to be issued.

On September 6, 2023, the Company issued 320 shares of common stock to a previous employee as compensation.

July 7, 2023, the Company issued 178,626 shares of common stock to a designee of its previous Chief Executive Officer as compensation.

These shares were previously accrued and were carried on the Company’s balance sheet as common stock to be issued.

On October 2, 2023, the Company issued 30,000 shares of common stock to a service provider as compensation.

August 31, 2023, the Company issued 14,754 shares of common stock to its previous Director of Strategic Acquisitions as compensation.

These shares were previously accrued and were carried on the Company’s balance sheet as common stock to be issued.

On November 7, 2023, the Company issued 678,302 shares of common stock, net of 265,229 shares withheld for income tax purposes, to its Chief Executive Officer pursuant to his compensation plan.

The fair value of these shares at the inception of the plan in the amount of $ 190,072 is charged to operations over the thirty-four month life of the plan.

On December 30, 2023, the Company issued the net amount of 57,560 shares of common stock in a cashless exercise of 360,000 options at a price of $ 0.62 per share.

On February 15, 2024, the Company issued 150,000 shares of common stock to a previous director for options previously exercised.

These shares were recorded as issued on the Company’s balance sheet effective December 31, 2023.

For the year ended December 31, 2022:

On April 8, 2022, the Company issued 33,445 shares with a value of $ 11,405 to an employee as compensation.

On April 25, 2022, the Company issued 142,857 shares with a value of $ 48,543 to a service provider.

Stock Appreciation Rights

Effective May 15, 2023, the Company issued 1,500,000 stock appreciation rights (the “Smallwood SARs”) to Brady Smallwood, its Chief Operating Officer.

The Smallwood SARs vest upon issuance, and expire on December 31, 2026;

750,000 of the Smallwood SARs are priced at $ 1.50 per share, and 750,000 are priced at $ 2.00 per share.

September 6, 2023, the Company issued 236,810 shares of common stock to a board member as compensation.

These shares were previously

accrued and were carried on the Company’s balance sheet as common stock to be issued.

September 6, 2023, the Company issued 222,401 shares of common stock, net of 14,409 shares owed to the Company from a previous transaction

to a board member as compensation.

These shares were previously accrued and were carried on the Company’s balance sheet as common

stock to be issued.

September 6, 2023, the Company issued 320 shares of common stock to a previous employee as compensation.

These shares were previously

accrued and were carried on the Company’s balance sheet as common stock to be issued.

October 2, 2023, the Company issued 30,000 shares of common stock to a service provider as compensation.

These shares were previously

accrued and were carried on the Company’s balance sheet as common stock to be issued.

November 7, 2023, the Company issued 678,302 shares of common stock, net of 265,229 shares withheld for income tax purposes, to its Chief

Executive Officer pursuant to his compensation plan.

The fair value of these shares at the inception of the plan in the amount of $ 190,072

is charged to operations over the thirty-four month life of the plan.

December 30, 2023, the Company issued the net amount of 57,560 shares of common stock in a cashless exercise of 360,000 options at a

price of $ 0.62 per share.

February 15, 2024, the Company issued 150,000 shares of common stock to a previous director for options previously exercised.

were recorded as issued on the Company’s balance sheet effective December 31, 2023.

Appreciation Rights

Effective May 15, 2023, the Company issued 1,500,000

stock appreciation rights (the “Smallwood SARs”) to Brady Smallwood, its Chief Operating Officer.

The Smallwood SARs vest

upon issuance, and expire on December 31, 2026;

750,000 of the Smallwood SARs are priced at $ 1.50 per share, and 750,000 are priced at

$ 2.00 per share.

It is the Company’s intention to settle the Smallwood SARs in cash.

The Smallwood SARs were valued utilizing the Black-Scholes valuation model, and had an aggregate fair value of $ 9,794 upon issuance.

This amount was charged to non-cash compensation and credited to a current liability on the Company’s balance sheet.

The Smallwood SARs will be revalued each reporting period and any change in value will be charged to compensation expense.

The Smallwood SARs were valued utilizing the

Black-Scholes valuation model, and had an aggregate fair value of $ 9,794 upon issuance.

This amount was charged to non-cash compensation

and credited to a current liability on the Company’s balance sheet.

The Smallwood SARs will be revalued each reporting period and

any change in value will be charged to compensation expense.

At December 31, 2024, the Smallwood SARs had a fair value of $ 1,353,150 ;

the increase in value in the amount of $ 245,226 was charged to compensation expense.

The Smallwood SARs were valued using the Black-Scholes valuation model utilizing the following variables:

the increase in value during the year ended December 31, 2024 in the amount of $ 1,098,130 was charged to compensation expense.

Smallwood SARs were valued using the Black-Scholes valuation model utilizing the following variables:

For the Year Ended

86.58 - 131.55 %

45.0 - 53.3 %

risk-free interest rates

3.66 - 4.71 %

3.67 - 5.03 %

Expected term (years)

Share-based Incentive Plans

CEO Stock Plan

On February 3, 2023, the Company entered into an employment agreement with Bill Bennett to become the Company’s CEO.

Incentive Plans

February 3, 2023, the Company entered into an employment agreement with Bill Bennett to become the Company’s CEO.

Pursuant to this agreement, Mr.

Bennett was provided with an incentive compensation plan (the “CEO Stock Plan”) whereby Mr.

Bennett would be granted shares of the Company’s common stock upon the common stock meeting certain price points at various 60-day volume weighted prices, as described below:

Bennett would be granted shares of the Company’s common stock upon the common stock meeting certain price points at various 60-day

volume weighted prices, as described below:

Number of Shares Granted - Lower of:

2 unchanged sentences

Grant Date Multiplied by:

The CEO Stock Plan had a fair value of $ 660,541 at inception (see “Stock Plan Valuation” section below).

This amount is being amortized over the 34 month life of the plan.

During the year ended December 31, 2023, $195,047 of this amount was charged to operations.

During the year ended December 31, 2023, the first of the price targets under the CEO Stock Plan was achieved, and Mr.

Bennett was eligible to receive 943,531 shares of the Company’s common stock.

CEO Stock Plan had a fair value of $ 660,541 at inception (see “Stock Plan Valuation” section below).

This amount is being

amortized over the 34 month life of the plan.

During the year ended December 31, 2024 and 2023, $ 233,132 and $ 195,047 of this amount

was charged to operations, respectively.

the year ended December 31, 2023, the first of the price targets under the CEO Stock Plan was achieved, and Mr.

Bennett was eligible

to receive 943,531 shares of the Company’s common stock.

On November 7, 2023, 678,302 of these shares were issued to Mr.

Bennet and of 265,229 shares were withheld for income tax purposes.

COO Stock Plan

On April 14, 2023, the Company entered into an employment agreement with Brady Smallwood to become the Company’s COO effective May 15, 2023.

and of 265,229 shares were withheld for income tax purposes.

During the year ended December 31, 2024, the price

targets of $0.80, $1.00, $1.20, $1.40, and $1.60 were achieved , and Mr.

Bennett became eligible to receive an additional total of 2,194,050

A total of 1,218,917 shares were issued to Mr.

Bennett, and an additional 530,665 shares were recorded as to be issued to Mr.

Bennett, net of 444,468 shares withheld for taxes;

at December 31, 2024, 487,566 shares were unearned.

April 14, 2023, the Company entered into an employment agreement with Brady Smallwood to become the Company’s COO effective May

Pursuant to this agreement, Mr.

Smallwood was provided with an incentive compensation plan (the “COO Stock Plan”) whereby Mr.

Smallwood would be granted shares of the Company’s common stock upon the common stock meeting certain price points at various 60-day volume weighted prices, as described below:

Number of Shares Granted - Lower of:

Number of Shares Issued

and Outstanding on

Grant Date Multiplied by:

The COO Stock Plan had a fair value of $ 199,951 at inception (see “Stock Plan Valuation” section below).

This amount is being amortized over the 31.5-month life of the plan.

During the year ended December 31, 2023, $ 47,607 of this amount was charged to operations.

At December 31, 2023, none of the price targets under the COO Stock Plan have been achieved.

CFO Stock Plan

On December 29, 2023, the Company entered into an employment agreement with Gary Schubert to become the Company’s CFO effective January 1, 2024.

Smallwood was provided with an incentive compensation plan (the “COO Stock

Plan”) whereby Mr.

Smallwood would be granted shares of the Company’s common stock upon the common stock meeting certain

price points at various 60-day volume weighted prices, as described below:

of Shares Granted - Lower of:

Shares Issued

and Outstanding

Date Multiplied by:

COO Stock Plan had a fair value of $ 199,951 at inception (see “Stock Plan Valuation” section below).

This amount is being

amortized over the 31.5-month life of the plan.

During the year ended December 31, 2024 and 2023, $ 76,172 and $ 47,607 of this amount

was charged to operations, respectively.

During the year ended December 31, 2024, the price

targets of $0.87, $1.16, and $1.45 were achieved , and Mr.

Smallwood became eligible to receive a total of 442,410 shares.

A total of 196,627

shares were issued to Mr.

Smallwood, and an additional 133,632 shares were recorded as to be issued, net of 112,151 shares withheld for

at December 31, 2024, 294,941 shares were unearned.

December 29, 2023, the Company entered into an employment agreement with Gary Schubert to become the Company’s CFO effective January

Pursuant to this agreement, Mr.

Schubert was provided with an incentive compensation plan (the “CFO Stock Plan”) whereby Mr.

Schubert would be granted shares of the Company’s common stock upon the common stock meeting certain price points at various 60-day volume weighted prices, as described below:

Number of Shares Granted - Lower of:

Number of Shares Issued

and Outstanding on

Grant Date Multiplied by:

The CFO Stock Plan had a fair value of $ 238,747 at inception (see “Stock Plan Valuation” section below).

This amount will be amortized over the 30-month life of the plan beginning January 1, 2024.

During the year ended December 31, 2023, $ 0 of this amount was charged to operations.

At December 31, 2023, none of the price targets under the COO Stock Plan have been achieved.

Valuation of Stock Plans

The Company relied upon the guidance of Statement of Financial Account Standards No.

718 Compensation – Stock Compensation (“ASC 718”) in accounting for the CEO Stock Plan, the COO Stock Plan, and the CFO Stock Plan (collectively, the "Officer Stock Plans”).

Schubert was provided with an incentive compensation plan (the “CFO Stock

Plan”) whereby Mr.

Schubert would be granted shares of the Company’s common stock upon the common stock meeting certain price

points at various 60-day volume weighted prices, as described below:

of Shares Granted - Lower of:

Shares Issued

and Outstanding

Date Multiplied by:

CFO Stock Plan had a fair value of $ 238,747 at inception (see “Stock Plan Valuation” section below).

This amount will be

amortized over the 30-month life of the plan beginning January 1, 2024.

During the year ended December 31, 2024 and 2023, $ 95,500 and

$ 0 of this amount was charged to operations, respectively.

During the year ended December 31, 2024, the price

targets of $1.23 and $1.63 were achieved , and Mr.

Schubert became eligible to receive a total of 229,398 shares, of which 131,085 were

approved for issuance by the Company’s board of directors.

A total of 73,735 shares were issued to Mr.

Schubert, net of 57,350 shares

withheld for taxes;

at December 31, 2024, 98,313 shares were earned and issuable pending approval of the Company’s board of directors,

and 262,169 shares were unearned.

of Stock Plans

Company relied upon the guidance of Statement of Financial Account Standards No.

718 Compensation – Stock Compensation (“ASC

718”) in accounting for the CEO Stock Plan, the COO Stock Plan, and the CFO Stock Plan (collectively, the “Officer Stock

A Monte Carlo market-based performance stock awards model was used in valuing the plan, with the following assumptions:

The stock price for each trading day would fluctuate with an estimated projected volatility using a normal distribution.

The stock price of the underlying instrument is modeled such that it follows a geometric Brownian motion with constant drift and volatility.

The Company would award the stock upon triggering the thresholds.

Annual attrition or forfeiture rates (i.e., pre–vesting forfeiture assumption) are assumed to be zero given the Holder’s position with the Company.

No Projected capital events were included in the adjustments to the shares issued and outstanding in the projected simulations.

Awards/Payouts were discounted at the risk–free rate.

The Officer Stock Plans were valued using the following variables:

stock price for each trading day would fluctuate with an estimated projected volatility using a normal distribution.

The stock price

of the underlying instrument is modeled such that it follows a geometric Brownian motion with constant drift and volatility.

Company would award the stock upon triggering the thresholds.

attrition or forfeiture rates (i.e., pre–vesting forfeiture assumption) are assumed to be zero given the Holder’s position

with the Company.

Projected capital events were included in the adjustments to the shares issued and outstanding in the projected simulations.

Awards/Payouts

were discounted at the risk–free rate.

Officer Stock Plans were not valued during the year ended December 31, 2024.

Officer Stock Plans were valued using the following variables during the year ended December 31, 2023:

103.9 %- 113.7 %

Risk-free interest rates

Expected term (years)

The following variables were utilized in valuing the Smallwood SARs:

Risk-free interest rates

4.29 %- 4.45 %

Expected term (years)

For the year ended December 31, 2023:

For the year ended December 31, 2022:

The Company issued 125,000 two -year options with an exercise price of $ 0.41 per share and a grant date fair value of $ 1,708 to a service provider.

These options vested upon issuance and will expire on April 25, 2024.

The Company issued 125,000 two -year options with an exercise price of $ 0.50 per share and a grant date fair value of $ 384 to a service provider.

These options vested upon issuance and will expire on April 25, 2024.

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, 2023:

Transactions involving stock options are summarized as follows:

Number of Shares

Weighted Average

Exercise Price

the year ended December 31, 2024:

Company issued 130,000 options with an exercise price of $ 1.25 per share and a grant date fair value of $ 20,847 to an employee.

options vested upon issuance and will expire on June 30, 2026.

Company issued 130,000 options with an exercise price of $ 1.75 per share and a grant date fair value of $ 11,688 to an employee.

options vested upon issuance and will expire on June 30, 2026.

the year ended December 31, 2023:

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, 2024:

Weighted Weighted

Weighted average average

average exercise exercise

Range of Number of Remaining price of Number of price of

exercise options contractual outstanding options exercisable

Prices Outstanding life (years) Options Exercisable Options

$ 1.00 50,000 0.99 $ 1.00 50,000 $ 1.00

$ 1.25 130,000 1.50 $ 1.25 130,000 $ 1.25

$ 1.75 130,000 1.99 $ 1.75 130,000 $ 1.750

310,000 1.41 $ 1.42 310,000 $ 1.42

involving stock options are summarized as follows:

Options outstanding at December 31, 2022

Cancelled / Expired

( 1,590,000 )

Options outstanding at December 31, 2023

1 unchanged sentence

Options outstanding at December 31, 2024

Aggregate intrinsic value of options outstanding and exercisable at December 31, 2023 and 2022 was $ 77,530 and $ 0 , respectively.

Aggregate intrinsic value represents the difference between the Company’s closing stock price on the last trading day of the fiscal period, which was $ 0.74 and $ 0.21 as of December 31, 2023 and 2022, respectively, and the exercise price multiplied by the number of options outstanding.

During the year ended December 31, 2023 and 2022, the Company charged $ 0 and $ 8,738 , respectively, to operations related to recognized stock-based compensation expense for stock options.

The exercise price at grant dates in relation to the market price during 2023 and 2022 are as follows:

intrinsic value of options outstanding and exercisable at December 31, 2024 and 2023 was $ 111,800 and $ 77,530 , respectively.

intrinsic value represents the difference between the Company’s closing stock price on the last trading day of the fiscal period,

which was $ 1.78 and $ 0.74 as of December 31, 2024 and 2023, respectively, and the exercise price multiplied by the number of options

the year ended December 31, 2024 and 2023, the Company charged $ 32,535 and $ 0 , respectively, to operations related to recognized stock-based

compensation expense for stock options.

exercise price at grant dates in relation to the market price during 2024 and 2023 are as follows:

Exercise price lower than market price

1 unchanged sentence

Exercise price exceeded market price

As of December 31, 2023, and 2022, there were no non-vested options outstanding.

Accounting for stock options

The Company valued stock options and stock appreciation rights using the Black-Scholes valuation model utilizing the following variables:

$ 1.25 - 1.75

of December 31, 2024, and 2023, there were no non-vested options outstanding.

for stock options

Company valued stock options using the Black-Scholes valuation model utilizing the following variables:

December 31, December 31,

Volatility 69.96 % - %

Dividends $ - $ -

Risk-free interest rates 4.64 % - %

Term (years) 2.36 -

CODM has determined that the Company operates in one reportable segment:

the delivery of specialty foods.

This determination was made

based upon the characteristics of our business and the information used by the CODM in order monitor the business and allocate resources.

analysis of the Company’s segments is determined by the Chief Operating Decision Maker (“CODM”).

The Company’s

CODM is a group consisting of our executive management team:

Bill Bennett, CEO;

Brady Smallwood, COO;

and Gary Schubert, CFO.

CODM uses net income to monitor budget versus actual results.

The CODM also uses revenue by category to monitor the growth of the business

in each of our target markets.

following table presents our segment results:

Digital Channels

National distribution

Local distribution

Direct to consumer

Other services

Total revenue

Cost of sales

Payroll & related costs

Computer and IT

Office, facility, vehicles

Travel & entertainment

Advertising & marketing

Banking and credit card processing

Professional fees

Non-cash Opex:

Bad debt expense

Impairment of intangible assets

Share based compensation

Depreciation & amortization of assets

Amortization of discount on notes payable

Non-recurring expenses:

Separation costs - executive officers

Non-Operating (Income) expense:

Interest expense

(Gain) loss on sale of subsidiaries

(Gain) loss on sale of assets

( 2,816,616 )

Other (income) expense

Total other (income) expense

$ ( 1,993,861 )

Net income (loss) before taxes

$ ( 3,697,833 )

Income tax expense

Net income (loss) from continuing operations

$ ( 3,713,667 )

Other segment disclosures:

Segment assets

Expenditures for segment assets

RELATED PARTY TRANSACTIONS

Hiring of COO

On April 14, 2023, the Company entered into an Executive Employment Agreement with Brady Smallwood (the “Smallwood Agreement”).

The Smallwood Agreement provides, among other things, for Mr.

Smallwood to become the Company’s Chief Operating Officer;

employment at-will with an initial term of employment from May 15, 2023 through December 31, 2025 with 9 months of Base Salary as severance payments if terminated without cause or resignation with Good Reason;

an annual Base Salary of $ 300,000 with at least 3 % annual increases with additional annual increases;

a $ 29,370 signing bonus;

an annual incentive bonus equal to at least $ 80,000 prorated for partial years;

and reimbursement of legal fees up to $ 5,000 .

In addition, Mr.

Smallwood was initially granted 1,500,000 stock options;

on June 8, 2023, this stock option grant was changed to a one-time grant of 1.5 million stock appreciation rights, with 750,000 SARs priced at $ 1.50 and 750,000 SARs priced at $ 2.00 ;

and participation in the Company’s benefit plans.

Smallwood is also subject to the Company’s clawback policies and certain restrictive covenants including confidentiality, non-compete and non-solicitation.

Smallwood is also eligible for stock grants based upon the market price of the Company’s common stock;

Hiring of CFO

On December 22, 2023, the board of directors of the Company appointed Mr.

Gary Schubert to the position of Chief Financial Officer of the Company, effective January 1, 2024 and on December 29, 2023 the Company entered into an Executive Employment Agreement with Mr.

Schubert (the “Schubert Agreement”).

The Schubert Agreement provides, among other things, for Mr.

Schubert to become the Company’s Chief Financial Officer;

employment at-will with an initial term of employment from January 1, 2024 through June 30, 2026 with 9 months of Base Salary as severance payments if terminated without cause or resignation with Good Reason;

an annual Base Salary of $ 280,000 with at least 3 % annual increases with additional annual increases;

a $ 30,000 signing bonus;

an annual incentive bonus equal to at least $ 60,000 prorated for partial years;

and reimbursement of legal fees up to $ 5,000 .

In addition, Mr.

Schubert was granted 1,500,000 stock options;

on June 8, 2023, this stock option grant was changed to a one-time grant of 1.5 million stock appreciation rights, with 750,000 SARs priced at $ 1.50 and 750,000 SARs priced at $ 2.00 ;

and participation in the Company’s benefit plans.

Smallwood is also subject to the Company’s clawback policies and certain restrictive covenants including confidentiality, non-compete and non-solicitation.

Smallwood is also eligible for stock grants based upon the market price of the Company’s common stock;

Separation of prior CEO and of a board member

During the year ended December 31, 2023, the Company made the following payments in connection with separation agreements with Sam Klepfish, its prior CEO and current board member, and Justin Weirnasz, its prior Director of Strategic Acquisitions and board member.

The Company paid cash in the amount of $ 525,643 to Mr.

The Company also issued 400,000 shares of common stock with a fair value of $ 168,000 .

of prior CEO and of a board member

the year ended December 31, 2024

Company made the following payments in connection with the SK Agreements:

The Company paid cash in the amount of $ 333,333 to Mr.

Company made the following payments in connection with the Wiernasz Separation Agreement:

The Company made Cobra payments on behalf of

Weirnasz in the amount of $ 967 .

Company made the following payments in connection with the Tang Separation Agreement:

The Company made cash payments to Mr.

amount of $ 113,918 , and Cobra payments on behalf of Mr.

Tang in the amount of $ 14,495 .

the year ended December 31, 2023

Company made the following payments in connection with separation agreements with Sam Klepfish, its prior CEO and current board member,

and Justin Weirnasz, its prior Director of Strategic Acquisitions and board member.

Company paid cash in the amount of $ 525,643 to Mr.

The Company also issued 400,000 shares of common stock with a fair value

of $ 168,000 .

Company paid cash in the amount of $ 100,000 to Mr.

Weirnasz and made Cobra payments on behalf of Mr.

Weirnasz in the amount of $ 25,484 .

Deferred income taxes result from the temporary differences primarily attributable to amortization of intangible assets and debt discount and an accumulation of net operating loss carryforwards for income tax purposes with a valuation allowance against the carryforwards for book purposes.

In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized.

Included in deferred tax assets are Federal and State net operating loss carryforwards of approximately $ 18,500,000 which can be carried forward indefinitely subject to limitation, except $ 6,742,000 which can be carried forward through 2037.

The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible.

Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income, and tax planning strategies in making this assessment.

Due to significant changes in the Company’s ownership, the Company’s future use of its existing net operating losses may be limited.

The provision (benefit) for income taxes for the years ended December 31, 2023 and 2022 consist of the following:

The provision (benefit) for income taxes differs from the amount of income tax determined by applying the applicable statutory income tax rate of 27.6 % for the years ended December 31, 2023 and 2022 to the loss before taxes as a result of the following differences:

income taxes result from the temporary differences primarily attributable to amortization of intangible assets and debt discount and

an accumulation of net operating loss carryforwards for income tax purposes with a valuation allowance against the carryforwards for

book purposes.

assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all

of the deferred tax assets will not be realized.

Included in deferred tax assets are Federal and State net operating loss carryforwards

of approximately $ 11,380,000 which can be carried forward indefinitely subject to limitation, except $ 2,660,000 which can be carried

forward through 2037.

The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during

the periods in which those temporary differences become deductible.

Management considers the scheduled reversal of deferred tax liabilities,

projected future taxable income, and tax planning strategies in making this assessment.

Due to significant changes in the Company’s

ownership, the Company’s future use of its existing net operating losses may be limited.

provision (benefit) for income taxes for the years ended December 31, 2024 and 2023 consist of the following:

provision (benefit) for income taxes differs from the amount of income tax determined by applying the applicable statutory income tax

rate of 27.6 % for the years ended December 31, 2024 and 2023 to the loss before taxes as a result of the following differences:

Income (loss) before income taxes

$ ( 4,143,188 )

Statutory tax rate

Total tax (benefit) at statutory rate

( 1,143,500 )

Permanent difference

2 unchanged sentences

Income tax expense

Deferred income taxes reflect the tax impact of temporary differences between the amounts of assets and liabilities for financial reporting purposes and such amounts as measured by tax laws and regulations.

Deferred income taxes include the net tax effects of net operating loss (NOL) carryforwards and the temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes.

As of December 31, 2023, and 2023 significant components of the Company’s deferred tax assets are as follows:

income taxes reflect the tax impact of temporary differences between the amounts of assets and liabilities for financial reporting purposes

and such amounts as measured by tax laws and regulations.

income taxes include the net tax effects of net operating loss (NOL) carryforwards and the temporary differences between the carrying

amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes.

As of December

31, 2024, and 2023 significant components of the Company’s deferred tax assets are as follows:

Deferred Tax Assets:

Net operating loss carryforwards

Allowance for doubtful accounts

Allowance for credit losses

Property and equipment

Stock based compensation

Intangible assets

1 unchanged sentence

Valuation allowance

( 5,066,000 )

( 5,904,000 )

Net deferred tax assets

The Company’s tax returns for the previous three years remain open for audit by the respective tax jurisdictions.

Company’s tax returns for the previous three years remain open for audit by the respective tax jurisdictions.

COMMITMENTS AND CONTINGENT LIABILITIES

License Agreements

In May 2019, the Company entered into a royalty-based license agreement, through December 31, 2022 with a lifestyle brand, which provides the exclusive right, with certain carve-outs and limitations, to sell and promote branded gift baskets for certain channels including:

retail, warehouse club stores, certain of the Company’s current e-commerce channels, and other e-commerce channels such as amazon.com (the “May 2019 License Agreement”).

Pursuant to the May 2019 License Agreement, the Company paid an initial royalty deposit in the amount of $ 50,000 towards the minimum royalty, which is classified as other current assets on the Company’s balance sheet at December 31, 2019.

Future royalty amounts owed for minimum payments in connection with the May 2019 License Agreement will be deducted from this deposit.

The royalty rate is 5 % of net sales, and the Company is required, with certain exceptions and exclusions, to make minimum royalty payments of $ 100,000 through the end of 2020, $ 110,000 in 2021, and $ 125,000 in 2022.

On September 16, 2019, an action (the “PA Action”) was filed in the Court of Common Pleas of Philadelphia County, Trial Division, against, among others, the Company and its wholly owned subsidiaries, igourmet and Food Innovations, Inc.

Since that time, other parties involved in the incident have joined as plaintiffs in the PA Action.

The complaint in the PA Action alleges, inter alia, wrongful death and negligence by a driver employed by igourmet and indicates a demand and offer to settle for $ 50,000,000 .

We expect that should a settlement occur the amount to resolve the Action would be substantially lower.

The Company and its subsidiaries had auto and umbrella insurance policies, among others, that were in effect for the relevant period The Company and its subsidiaries’ insurers have agreed to defend the Company and its subsidiaries in the PA Action (and the related action), subject to a reservation of rights.

The Company believes that the likely outcome would result in the liabilities being covered by its insurance carriers.

However, if the Company was found responsible for damages in excess of its available insurance coverage, such damages in excess of the coverage could have a material adverse effect on the Company’s operations.

The case was set for trial for April 1, 2024.

The Company anticipates that such paperwork will be completed, and that the matter will be officially dismissed, in the second quarter of 2024.

The Company and its subsidiaries resolved all liabilities within the coverages of their insurance carriers.

time to time, the Company has become and may become involved in certain lawsuits and legal proceedings which arise in the ordinary course

of business, or as the result of current or previous investments, or current or previous subsidiaries, or current or previous employees,

or current or previous directors, or as a result of acquisitions and dispositions or other corporate activities.

The Company intends

to vigorously defend its positions.

However, litigation is subject to inherent uncertainties, and an adverse result in these or other

matters may arise from time to time that may harm our financial position or our business and the outcome of these matters cannot be ultimately

MAJOR CUSTOMERS

The Company’s largest customer, U.S.

and its affiliates, accounted for approximately 47 % and 49 % of total sales in each of the years ended December 31, 2023 and 2022.

A contract between our subsidiary, Food Innovations, and U.S.

Foods entered an optional renewal period in December 2012 but was automatically extended for an additional 12 months in each of January 1, 2013 and 2014.

On January 26, 2015 we executed a contract directly between Food Innovations, Inc., our wholly owned subsidiary, and U.S.

The term of the contract was from January 1, 2015 through December 31, 2016 and provided for a limited number of automatic annual renewals thereafter if no party gives the other 30 days’ notice of its intent not to renew.

Based on the terms, the Agreement was extended through December 31, 2018.

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, Gate Gourmet, the leading global provider of airline catering solutions and provisioning services for airlines, in partnership with igourmet, represented 13 % and 15 % of total sales for the year ended December 31, 2023 and 2022, respectively.

Company’s largest customer, U.S.

and its affiliates, accounted for approximately 43 % and 48 % of total sales in each

of the years ended December 31, 2024 and 2023, respectively.

In addition, Gate Gourmet, the leading global provider of airline catering

solutions and provisioning services for airlines, in partnership with igourmet, represented 16 % and 15 % of total sales for the year ended

December 31, 2024 and 2023, respectively.

FAIR VALUE MEASUREMENTS

Our short-term financial instruments, including cash, accounts payable and other liabilities, consist primarily of instruments without extended maturities, the fair value of which, based on management’s estimates, reasonably approximate their book value.

The fair value of the Company’s stock options is determined using option pricing models.

As a result of the adoption of ASC 815-40, the Company is required to disclose the fair value measurements required by ASC 820, “Fair Value Measurements and Disclosures.” Hierarchical levels, defined by ASC 820 are directly related to the amount of subjectivity associated with the inputs to fair valuations of these liabilities are as follows:

Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date;

Inputs other than Level 1 inputs that are either directly or indirectly observable;

Unobservable inputs, for which little or no market data exist, therefore requiring an entity to develop its own assumptions.

During the year ended December 31, 2023, the Company recorded the fair value of the Smallwood SARs at each reporting period.

At December 31, 2022, the Company did not have financial assets or liabilities that are required to be accounted for at fair value on a recurring basis.

short-term financial instruments, including cash, accounts payable and other liabilities, consist primarily of instruments without extended

maturities, the fair value of which, based on management’s estimates, reasonably approximate their book value.

The fair value of

the Company’s stock options is determined using option pricing models.

a result of the adoption of ASC 815-40, the Company is required to disclose the fair value measurements required by ASC 820, “Fair

Value Measurements and Disclosures.” Hierarchical levels, defined by ASC 820 are directly related to the amount of subjectivity

associated with the inputs to fair valuations of these liabilities are as follows:

are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date;

other than Level 1 inputs that are either directly or indirectly observable;

inputs, for which little or no market data exist, therefore requiring an entity to develop its own assumptions.

the year ended December 31, 2024, the Company recorded the fair value of the Smallwood SARs at each reporting period.

At December 31,

2023, the Company did not have financial assets or liabilities that are required to be accounted for at fair value on a recurring basis.

SUBSEQUENT EVENTS

Settlement of Lawsuit

On January 5, 2024, all parties to the PA Action came to an agreement at Mediation on the material terms of settlement and on January 22, 2024, a settlement was agreed upon in an action filed in the Court of Common Pleas of Philadelphia County, Trial Division against, among others, the Company and its wholly owned subsidiaries, igourmet and Food Innovations, Inc.

On Monday, January 29, 2024, the Company received a settlement and release agreement from certain plaintiffs in the PA Action.

The Company and its subsidiaries resolved all liabilities within the coverages of their insurance carriers.

Lease of Office and Change of Primary Address

On January 18, 2024, the Company signed a one-year lease for 1,335 rentable square feet of office space located at 9696 Bonita Beach Road, Bonita Springs, Florida, 34135, and this location became the Company’s primary address.

Base rent for the Bonita Beach Road property is $ 1,891 per month plus approximately $ 723 in common area maintenance charges.

Sale of Building Held for Sale

On February 14, 2024, the Company closed on the sale of its warehouse located at 28411 Race Track Road, Bonita Springs FL 34135 (the “Warehouse”) to Tag Media Group LLC, dba “Gulf Coast Aluminum” The Warehouse consists of approximately 1.1 acres of land and close to 10,000 square feet of combined office and warehouse space.

Pursuant to a purchase and sale agreement between dated December 12, 2023 the Company agreed to sell the Warehouse, certain warehouse racking, and a forklift to Gulf Coast Aluminum for a total purchase price of $ 2,455,000 , prior to customary closing costs.

The Company received approximately $ 1.9 million in net proceeds from the transaction.

Sale of Haley Food Group Inc.

On February 27, 2024, the Company entered into a stock for stock exchange agreement whereby we exchanged 100 shares of stock of The Haley Food Group Inc., which represented 100 % of Haley’s outstanding stock, for 21,126 shares of our common stock.

January 9, 2025, the Company issued 60,000 shares of common stock pursuant to the cashless exercise of options held by an ex-employee

to purchase 130,000 shares of common stock at a price of $ 1.25 per share and an additional 130,000 shares of common stock at a price

of $ 1.75 per share.

On January 13, 2025, the Company issued 24,026 shares of common stock pursuant to the cashless exercise of

options held by an ex-employee to purchase 50,000 shares of common stock at a price of $ 1.00 per share.

On March 14, 2025, the Company the following shares of common stock

to its executive officers pursuant to executive compensation plans:

530,665 shares were issued to its CEO;

133,632 shares were issued

and 73,735 shares were issued to its CFO.

These shares were classified as shares to be issued on the Company’s balance

sheet at December 31, 2024.

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

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 8. Financial Statements and Supplementary Data