What changed in this filing

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Item 5. Market for Registrant’s Common Equity

2026-03-31 compared with 2025-03-20 · 189 added, 242 removed, 144 unchanged (75% of the section changed)

Market For Registrant ’ s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Prices for our common stock are quoted on the OTCQB.

Since March 2004,

our common stock has traded under the symbol “IVFH”.

Prior thereto, our common stock traded under the symbol “FBSN”.

At March 12, 2025, there were 53,986,793 shares of our common stock outstanding.

On March 5, 2025, there were approximately 1,450 record holders of

our common stock.

In addition, we believe there are at least several hundred additional beneficial owners of our common stock whose shares

are held in “street name.”

Prices for our common stock are quoted on the

Since March 2004, our common stock has traded under the symbol “IVFH”.

Prior thereto, our common stock traded under

the symbol “FBSN.” At March 12, 2026, there were 54,649,479 shares of our common stock outstanding.

March 12, 2026, there were approximately 63 record holders of our common stock.

In addition, we believe there are at least several hundred

additional beneficial owners of our common stock whose shares are held in “street name.”

have not paid dividends during the three most recently completed fiscal years and have no current plans to pay dividends on our common

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1, 2025 to Dec.

conversion of options to purchase 50,000 shares of common stock by an ex-employee for a net

amount of 24,138 shares issued.

of shares issued to executive officers pursuant to stock compensation plans based upon the

market price of the Company’s common stock.

Shares were issued to the Company’s

CEO as follows:

731,350 shares when the market price was $1.16, and 487,567 shares when the

market price was $1.45.

Shares were issued to the Company’s COO as follows:

shares when the market price was $1.23.

of common stock sold for cash.

On November 30, 2024 and December 4, 2024, the Company entered

into a series of securities purchase agreements with certain investors (the “Investors”),

pursuant to which, among other things, the Company issued the Investors an aggregate of 2,031,250

shares of common stock of the Company at a purchase price of $1.60 per share, for an aggregate

purchase price of $3,250,000.

Consists of shares issued to executive officers pursuant to executive compensation plans:

530,665 shares were issued to the predecessor CEO;

133,632 shares were issued to the COO;

and 73,735 shares were issued to the successor CEO under the Prior CFO stock plan.

Also includes cash conversion of options to purchase 310,000 shares of common stock for a net amount issued of 84,026 shares.

These shares were classified as shares to be issued on the Company’s balance sheet at December 31, 2024.

Consists of shares issued to executive officers pursuant to stock compensation plans:

273,036 shares were issued to the predecessor CEO;

and 92,168 shares were issued to the successor CEO under the Prior CFO stock plan.

of shares issued to the COO pursuant to a stock compensation plan.

of shares issued to the predecessor CEO pursuant to a stock compensation plan.

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

(1) none of the issuances involved a public offering or public advertising for the payment of any commissions or fees;

(2) the issuances

(i) none of the issuances involved a public offering or public advertising for the payment of any commissions or fees;

(ii) the issuances

to investors were to “accredited investors”;

(3) the issuances upon conversion of notes were for notes held at least 12 months

and did not involve the payment of any other consideration;

and (4) all issuances to affiliates and to non-affiliates holding the securities

and (iii) all issuances to affiliates and to non-affiliates holding the securities

for less than six months carried restrictive legends.

of December 31, 2024, there were 310,000 options to purchase shares of the Company’s common stock with a weighted average remaining

contractual life of 1.42 years.

Authorized for Issuance Under Equity Compensation Plans

of December 31, 2024, the following shares are issuable pursuant to outstanding stock options, warrants, and rights issued under the

of December 31, 2025, the following shares were issuable pursuant to outstanding stock options, warrants, and rights issued under the

2011 Stock Option Plan:

Plan Category

available for

Equity compensation plans approved

by security holders

Equity compensation plans approved by security holders

Equity compensation plans not approved by shareholders

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uncertainties associated with:

ability to raise capital necessary to sustain our anticipated operations and implement our business plan,

ability to raise capital necessary to sustain our anticipated operations,

ability to implement our business plan,

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statements, whether from new information, future events or otherwise.

and Share Issuance

and Disposition

August 30, 2024, Innovative Gourmet, which is a wholly-owned subsidiary of the Company, and iGourmet, entered into an amended and restated

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30, 2024, with iGourmet.

We exited this business during the year ended December 31, 2024.

October 14, 2024, the Company entered into the Golden APA with Golden Organics, and David Rickard.

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The Golden Transaction closed on November 18, 2024.

November 30, 2024 and December 4, 2024, the Company entered into a series of securities purchase agreements with certain investors, pursuant

to which, among other things, the Company issued the investors an aggregate of 2,031,250 shares of common stock of the Company at a purchase

price of $1.60 per share, for an aggregate purchase price of $3,250,000.

December 20, 2024, the Company through its subsidiary, Golden Organics, acquired substantially all of LoCo’s properties, business,

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Mozer and Benjamin Mozer.

In addition, as an adjustment

to the purchase price, if earned, Golden Organics will pay $53,430 as earnout if, in the twelve-month period, LoCo achieves certain revenue

and adjusted EBITDA targets.

In connection with the LoCo APA, Ms.

Mozer entered into a consulting services agreement with Golden Organics

to provide consulting services for a period of twelve (12) months with the option to extend on a month-to-month basis with respect to

the transitioning of the relationships and knowledge concerning the LoCo’s business, which agreement also contains a two-year non-solicitation

In connection with the LoCo

Mozer entered into a consulting services agreement with Golden Organics to provide consulting services for a period of twelve

(12) months with the option to extend on a month-to-month basis with respect to the transitioning of the relationships and knowledge

concerning the LoCo’s business, which agreement also contains a two-year non-solicitation provision.

Company’s subsidiary, Innovative Properties, entered into an Agreement of Purchase and Sale dated July 28, 2025, as amended on

September 11, 2025, September 29, 2025, and November 13, 2025, with Mountaintop Holdings.

Pursuant to the agreement, Innovative Properties

agreed to sell to Mountaintop Holdings certain real property located at 220 Oak Hill Road, Mountaintop, Pennsylvania 18707, together

with all rights, title, improvements, easements, and appurtenant interests, which is improved with warehouse facilities, as well as certain

personal property, contracts, and intangibles of Innovative Properties.

The sale closed on March 6, 2026, at which time Innovative Properties

received gross proceeds of $9.225 million.

OF OPERATIONS

Food Holdings, Inc.

(IVFH) experienced a transformative year in 2024, marked by strategic initiatives aimed at stabilizing the business

and laying the foundation for future growth.

The Company focused on enhancing its digital presence, expanding its specialty foodservice

platform, and diversifying its distribution channels.

Key milestones included the acquisition of Golden Organics and LoCo, the sale of

non-core assets, and the onboarding of a new CFO.

the fiscal year ended December 31, 2024, IVFH reported revenue of $72.1 million, a 2.5% increase compared to $70.4 million in

Our organic revenue growth, which excludes the impact of divestitures and acquisitions, was an impressive 11.4% for the full year.

Revenue growth was particularly strong in Q4, with total revenue increasing 19.2% and organic revenue increasing 44.3%.

These results

reflect our strategic efforts to enhance our market presence and expand our customer base.

Largely made up of our Distributor Relationships and supported by our

Drop Ship model.

This category contributed $37.9 million, which is 52.5% of our total revenue.

This represents a decrease of 3.9% from $39.4 million in 2023, primarily due to continued

headwinds in our legacy drop ship business.

Distribution:

Captures our growing partnerships with airline caterers and our new

national retail customer.

This category generated $18.0 million, or 24.9% of total revenue,

marking a 67.4% increase from $10.7 million in 2023.

These sales are generally delivered

to the customer through 3PL carriers or FedEx.

Distribution:

represented a transitional year for IVFH as the Company shifted its focus toward strengthening its internal operating foundation to support

sustainable growth.

During the year, management prioritized improvements to core business processes, operational discipline, and supporting

software and systems, with the objective of creating greater consistency, visibility, and scalability across the organization.

efforts included initiatives to better align procurement, forecasting, and order management processes, enhance operational workflows

across distribution channels, and reinforce the Company’s core operating platform.

part of this effort, the Company also took steps to streamline its operating footprint and improve overall efficiency.

This included

the planned exit and subsequent sale of the Pennsylvania facility, which was completed in the first quarter of 2026, and the transition

of certain related activities into existing operating locations.

These actions were intended to simplify the operating structure, reduce

complexity, and allow management to focus resources on core distribution and digital channel operations.

For the fiscal year ended December 31, 2025,

IVFH reported revenue of $60.7 million, a 2.1% increase compared to $59.5 million in 2024.

Revenue Breakdown:

Digital Channels:

Largely made up of our distributor relationships and supported by our drop ship model.

This category contributed $32.5 million, which is 54% of our total revenue from continuing operations.

This represents a decrease of 7.2% from $35 million in 2024, primarily due to continued headwinds in our legacy drop ship business.

National Distribution:

Captures our partnerships with airline caterers.

This category generated

$12.9 million, or 21% of total revenue from continuing operations, marking a 4.8% increase from $12.3 million in 2024.

These sales are

generally delivered to the customer through 3PL carriers or FedEx.

Local Distribution:

Consists mainly of local sales team relationships and our local fleet

delivering direct from warehouse.

This category brought in $12.1 million, or 16.8% of total

revenue, an increase of 21.8% from $9.9 million in 2023, supported by the expansion of local

distribution channels and the acquisition of LoCo Foods.

● Direct-to-Consumer:

however, will remain through 2025 as we overlap the historical revenues generated from the iGourmet.com in 2024.

Direct-to-Consumer revenue was $3.1 million, or 4.3% of total revenue, a decrease of 66.2% from $9.2 million in 2023.

Consists of numerous activities, mainly monetizing the excess space in

Pennsylvania.

This category contributed $1.1 million, or 1.5% of total revenue, a decrease

of 4.6% from $1.2 million in 2023.

of goods sold for the year was $55.3 million, an increase of 3.6% compared to $53.3 million in 2023.

Gross margin declined by 85

basis points to 23.4%, primarily due to liquidation of inventory from divested businesses and the ramp-up of the lower-margin

retail business.

However, this decline was offset by a reduction in operating expenses and positive non-operating income driven by

strategic divestments and cost reductions.

This category brought in $15.3 million, or 25% of total revenue from continuing operations, an increase

of 26% from $12.1 million in 2024, supported by the expansion of local distribution channels and the acquisition of LoCo Foods.

Cost of goods sold for the year was $45.0 million,

compared to $44.4 million in 2024, an increase of 1.4%.

Gross margin increased 49 basis points to 25.8%, primarily due to changes in

revenue mix, including shifts in the relative sales volume by distributor within the drop ship channel.

Operating Expenses (Cash OpEx):

and Related Costs:

Decreased by $272 thousand to $10.3 million, mainly dut to a lower incentive playout to our leadership and executive

teams compared to 2023.

Increased by $0.8 million to $9.4 million, primarily due to a $1.2 million increase related to the Denver warehouse

acquired in late 2024, partially offset by a $0.4 million decrease in variable compensation and a $0.04 million decrease from headcount

and IT Costs:

Reduced by $122 thousand to $391 thousand, reflecting the Company’s efforts to

streamline IT operations and reduce software and hardware expenses.

Increased by $69 thousand to $461 thousand, reflecting the Company’s efforts to build out the harvest platform

Facilities, and Vehicles Costs:

Decreased by $227 thousand to $963 thousand, driven by the consolidation

of office spaces and more efficient use of facilities and vehicles.

● Advertising

Increased by $770 thousand to $1.4 million, driven by the newly acquired facility in Denver ($435K)

and increased fleet cost of $170 thousand in the Chicago business.

and Digital Marketing Costs:

Significant reduction of $555 thousand to $30 thousand, resulting from

the restructuring of marketing programs and a strategic shift away from direct-to-consumer

● Professional

Increased by $27 thousand to $31 thousand, primarily resulting from our Harvest platform and fees associated

with web design and platform fees.

and Legal Fees:

Increased by $310 thousand to $1.6 million, due to various legal and transactional

activities related to acquisitions, divestitures, and other corporate actions.

Cash OpEx Reduction :

The total Cash OpEx decreased by $904 thousand, reflecting the Company’s cost-cutting efforts and

restructuring initiatives.

Decreased by $109 thousand to $1.4 million, due to various legal and transactional activities related to acquisitions,

divestitures, and other corporate actions.

total Cash OpEx increased by $1.4 million, primarily related to $2.0 million in operating expenses associated with the acquisition of

the Denver business, offset by the items noted above.

Operating Expenses (Non-Cash OpEx):

● Share-Based

Compensation:

Increased by $869 thousand to $1.5 million, due to revaluation of stock options and

other equity-based incentives to attract and retain key personnel.

Depreciation and Amortization Costs:

Decreased by $279 thousand to $278 thousand, reflecting the Company’s efforts to optimize its asset base driven by the sale or our Florida headquarters building.

Debt Expense:

Decreased by $69 thousand to $5 thousand, as a result of improved credit management and

collection efforts.

Impairment of Intangible Assets:

No impairment costs in 2024, compared to $1.1 million in 2023, due to the absence of significant write-downs of intangible assets.

Decreased by $2.5 million to $(933) thousand, due to revaluation of stock appreciation rights.

and Amortization Costs:

Increased by $139 thousand to $254 thousand, based on increased PPE assets associated with Denver acquisitions.

Loss Expense:

Increased by $101 thousand to $106 thousand, primarily due to write offs within our local restaurant business and associated

bankruptcies of certain customers.

Non-Cash OpEx Reduction:

The total Non-Cash OpEx decreased by $557 thousand, primarily due to the absence of impairment costs and

reduced depreciation and amortization expenses.

The total Non-Cash OpEx decreased by $2.2 million, primarily due to the revaluation of stock appreciation rights.

Non-Recurring

separation costs in 2024, compared to $2.1 million in 2023 related to the departure of several

executive officers.

Non-Operating

Income (Expense):

the year, IVFH recorded several gains and losses:

Sale of Assets:

$2.8 million, including $1.8 million from the sale of the headquarters building and $1.0 million from the sale of

certain intangible assets.

on Sale of Subsidiaries:

$21 thousand from the sale of Haley Group, Inc.

$6 thousand from leasing space in the Mountaintop warehouse facility.

total non-operating income was $1.8 million, contributing positively to the Company’s overall financial performance.

Net income from continuing operations improved

significantly, reaching $2.5 million compared to a net loss of $3.7 million in 2023.

thousand in separation costs in 2025, compared to $40 thousand in separation costs in 2024.

Income Tax Expense:

Increased to $81 thousand in 2025, compared to $0 in 2024.

income from continuing operations declined by 39.1% to $2.5 million, compared to $4.2 million in 2024.

and Capital Resources

of December 31, 2024, IVFH had current assets of $23.9 million, including cash and cash equivalents of $2.3 million, and current liabilities

of $9.4 million.

The company had net working capital of $14.5 million.

As of December 31, 2025, IVFH had current assets

of $16.8 million, including cash and cash equivalents of $0.9 million, and current liabilities of $12.4 million.

The Company had net working

capital of $4.4 million.

Flow Analysis :

Used $6.3 million, primarily due to changes in working capital components.

Used $27 thousand, primarily due to the Company’s net loss.

Changes in the Company’s working capital

components contributed $630 thousand of working capital.

The significant changes in working capital included:

Accounts Receivable:

Increased by $3.8 million, reflecting higher sales from our new customers, indicating strong demand and expanding market reach.

Increased by $1.9 million, primarily due to the acquisition of Golden Organics and LoCo, as well as higher inventory levels to support new retail and distribution channels.

Accounts Payable and Accrued Liabilities:

Decreased by $850 thousand, mainly due to the lower annual incentive plan payout recorded in 2024 but paid in 2025, and the elimination of accrued liabilities related to the divestiture of eCommerce operations.

Deferred Revenue:

Decreased by $791 thousand, primarily a result of the sale of our eCommerce business, we no longer sell or service gift cards or subscription services.

Provided $1.2 million, mainly driven by the sales proceeds of assets, offset

by the acquisition of Golden Organics and property and equipment.

Key investments and proceeds

Proceeds from Sale of Assets:

$2.1 million from the sale of the headquarters building.

Proceeds from Sale of Intangible Assets:

$617 thousand from the sale of certain intangible assets associated with iGourmet.com.

Acquisition of Golden Organics:

$1.2 million.

Acquisition of Property and Equipment:

Decreased by $3.3 million, reflecting shut down of the retail cheese business.

Decreased by $1.3 million, primarily due to retail cheese business shut down.

Payable and Accrued Liabilities:

Decreased by $3.5 million, mainly due to cheese business shut down and the lower annual incentive

plan payout recorded in 2024 but paid in 2025, and the elimination of accrued liabilities related to the divestiture of eCommerce

lease liability:

Decreased by $246 thousand due to lease payments made during the period.

separation cost – related parties:

Decreased by $283 thousand due to periodic payments made.

Used $187 thousand due to the acquisition and disposition of property and equipment.

from Sale of Assets:

$54 thousand from the sale of warehouse equipment.

of Property and Equipment:

$242 thousand.

Provided $2.0 million, primarily from the sale of common stock.

Key financing

activities included:

Proceeds from Sale of Common Stock:

$3.3 million.

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

Used $645 thousand.

Key financing activities included:

payments on debt:

$180 thousand.

Principal Payments on Financing Leases:

for taxes related to net share settlement of equity awards:

$276 thousand.

Principal Payments on Notes Payable:

Payments on Financing Leases:

$189 thousand.

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of Distribution Facilities :

Upgrading and expanding warehouse and distribution facilities

to accommodate increased demand and improve operational efficiency.

Upgrading and expanding warehouse and distribution facilities to accommodate increased demand and

improve operational efficiency.

Investments :

Enhancing the company’s digital platforms and IT infrastructure to

support e-commerce growth and improve customer experience.

Enhancing the company’s digital platforms and IT infrastructure to support e-commerce growth and improve customer

Development :

Investing in new product lines and innovations to meet changing customer

preferences and expand market share.

Investing in new product lines and innovations to meet changing customer preferences and expand market share.

Company plans to finance these capital needs through a combination of internal cash flows, debt financing, and potential equity offerings.

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Flow Forecasting :

Regularly updating cash flow projections to anticipate and manage cash

needs effectively.

Regularly updating cash flow projections to anticipate and manage cash needs effectively.

Capital Management :

Implementing strategies to optimize inventory levels, manage accounts

receivable, and extend payment terms with suppliers.

Maintaining access to credit lines and other financing options to provide

flexibility in managing short-term cash needs.

Implementing strategies to optimize inventory levels, manage accounts receivable, and extend payment terms

with suppliers.

Maintaining access to credit lines and other financing options to provide flexibility in managing short-term cash

of Excess Cash :

Investing surplus cash in short-term, low-risk instruments to generate

returns while preserving liquidity.

Investing surplus cash in short-term, low-risk instruments to generate returns while preserving liquidity.

Opportunities :

IVFH aims to continue its growth trajectory by focusing on stabilizing

the business, growing the direct-to-chef specialty foodservice platform, diversifying the

drop ship business, and expanding the specialty food distribution business.

The company is

well-positioned to capitalize on growth opportunities in the specialty foodservice market.

IVFH aims to continue its growth trajectory by focusing on stabilizing the business, growing the direct-to-chef

specialty foodservice platform, diversifying the drop ship business, and expanding the specialty food distribution business.

company is well-positioned to capitalize on growth opportunities in the specialty foodservice market.

Initiatives :

The Company plans to invest in digital transformation, enhance its e-commerce

capabilities, and expand its distribution network.

These initiatives are expected to drive

revenue growth and improve profitability.

The Company plans to invest in digital transformation, enhance its e-commerce capabilities, and expand its distribution

These initiatives are expected to drive revenue growth and improve profitability.

faces several risks that could impact its financial performance.

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on Major Customers :

The Company has historically derived a substantial portion of its

revenue from one client, U.S.

Foods, Inc., and if this relationship were to change materially,

it could significantly impact IVFH’s operations.

Changes in economic conditions, including both COVID-19 related and non-related

conditions, can affect consumer confidence and spending, which in turn can impact IVFH’s

The Company has historically derived a substantial portion of its revenue from one client, U.S.

and if this relationship were to change materially, it could significantly impact IVFH’s operations.

Changes in economic conditions can affect consumer confidence and spending, which in turn can impact IVFH’s

Competition :

The specialty food and foodservice industries are highly competitive, and IVFH competes against

other providers of quality foods, some of which have significantly greater resources.

The specialty food and foodservice industries are highly competitive, and IVFH competes against other providers of quality foods,

some of which have significantly greater resources.

Chain Disruptions :

IVFH relies on outside vendors and shippers for its specialty food

products, and any interruption in the supply of these products or failure to adhere to quality

standards could negatively impact the company’s revenues.

Changes in government regulation and supervision could impair IVFH’s

sources of revenue and limit its ability to expand its business.

IVFH relies on outside vendors and shippers for its specialty food products, and any interruption in the supply

of these products or failure to adhere to quality standards could negatively impact the company’s revenues.

Changes in government regulation and supervision could impair IVFH’s sources of revenue and limit its ability

to expand its business.

Sheet Arrangements

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are material to investors.

Accounting Policy and Estimates

Use of Estimates in the Preparation of Consolidated

Financial Statements

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.

These estimates include certain assumptions related to, among others, doubtful accounts

receivable, valuation of stock-based services, operating right of use assets and liabilities, and income taxes.

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, income taxes, intangible assets, contingent 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.

Stock options and stock appreciation rights (“SARS”):

Critical Accounting Policies and Estimates

Our consolidated financial statements are prepared

in accordance with U.S.

generally accepted accounting principles.

In preparing our consolidated financial statements, we make assumptions,

judgments, and estimates that can have a significant impact on amounts reported in our consolidated financial statements.

our estimates and assumptions on an ongoing basis.

We base our assumptions, judgments, and estimates on historical experience and various

other factors that we believe to be reasonable under the circumstances.

Actual results could differ materially from these estimates under

different assumptions or conditions.

Our significant accounting policies are described

in Part II, Item 8, “Nature of Activities and Summary of Significant Accounting Policies,” Note 1, “Business and Summary

of Significant Accounting Policies,” in the notes to consolidated financial statements.

An accounting policy is deemed to be critical

if it requires an accounting estimate to be made based on assumptions about matters that are highly uncertain at the time the estimate

is made, if different estimates reasonably could have been used, or if changes in the estimate that are reasonably possible could materially

impact the financial statements.

We believe that of all our significant accounting policies, the following accounting policies and specific

estimates involve a greater degree of judgment and complexity.

Accordingly, these are the accounting policies we believe are the most

critical to aid in fully understanding and evaluating our financial condition and results of operations.

Options and Stock Appreciation Rights

Company accounts for options in accordance with FASB ASC 718-40.

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key information regarding our options, SARS, and valuation assumptions at December 31, 2025 and 2024:

Black-Scholes

model variables:

Black-Scholes model variables:

77.84-205.63 %

interest rates

Allowance for Credit Losses

The Company maintained an allowance in the amount

of $40,002 and $46,477 for credit losses at December 31, 2024 and 2023, respectively.

The Company has an operational relationship of several

years with our major customers, and we believe this experience provides us with a solid foundation from which to estimate our expected

losses on accounts receivable.

Should our sales mix change or if we develop new lines of business or new customers, these estimates and

our estimation process will change accordingly.

These estimates have been accurate in the past.

Value of Financial Instruments

Company measures its financial assets and liabilities in accordance with accounting principles generally accepted in the United States

of America (“U.S.

The estimated fair values approximate their carrying value because of the short-term maturity of

these instruments or the stated interest rates are indicative of market interest rates.

These fair values have historically varied due

to the market price of the Company’s stock at the date of valuation.

Company uses the liability method of accounting for income taxes.

Deferred tax assets and liabilities are recognized for the future tax

consequences attributable to financial statements carrying amounts of existing assets and liabilities and their respective tax bases

and operating loss and tax credit carry-forwards.

The measurement of deferred tax assets and liabilities is based on provisions of applicable

The measurement of deferred tax assets is reduced, if necessary, by a valuation allowance based on the amount of tax benefits

that, based on available evidence, is not expected to be realized.

At December 31, 2024, the Company has a net operating loss carryforward

of approximately $3,875,000.

86.8-131.55 %

Risk-free interest rates

for Credit Losses

Company maintained an allowance in the amount of $218,319 and $40,002 for credit losses at December 31, 2025 and 2024, respectively.

The Company has an operational relationship of several years with our major customers, and we believe this experience provides us with

a solid foundation from which to estimate our expected losses on accounts receivable.

Should our sales mix change or if we develop new

lines of business or new customers, these estimates and our estimation process will change accordingly.

These estimates have been accurate

The Company uses the liability method of accounting

for income taxes.

Deferred tax assets and liabilities are recognized for the future tax consequences attributable to financial statements

carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carry-forwards.

measurement of deferred tax assets and liabilities is based on provisions of applicable tax law.

The measurement of deferred tax assets

is reduced, if necessary, by a valuation allowance based on the amount of tax benefits that, based on available evidence, is not expected

to be realized.

The Company recognizes interest and penalties

related to uncertain tax positions in income tax expense.

Accrued interest and penalties are included within income taxes payable in the

consolidated balance sheet

At December 31, 2025, the Company has a net operating

loss carryforward of approximately $21,256,747.

Company determines if an arrangement is a lease at inception.

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Finance lease ROU assets are presented

within other assets, and finance lease liabilities are presented within accrued liabilities.

within long term assets, and finance lease liabilities are presented within accrued liabilities.

The Company used our incremental borrowing

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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 5. Market for Registrant’s Common Equity