What changed in this filing

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Item 7. Management’s Discussion and Analysis

2022-12-15 compared with 2021-12-09 · 265 added, 224 removed, 174 unchanged (74% of the section changed)

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

discussion and analysis of results of operations and financial condition (“MD&A”) is a supplement to the accompanying

consolidated financial statements and provides additional information on our businesses, current developments, financial condition, cash

flows and results of operations.

The following discussion should be read in conjunction with our consolidated financial statements for

the year ended October 3, 2021 provided in this Annual Report on Form 10-K.

Certain statements contained herein may constitute forward-looking

statements within the meaning of the Private Securities Litigation Reform Act of 1995.

These statements involve a number of risks, uncertainties

and other factors that could cause actual results to differ materially, as discussed more fully herein.

discussion and analysis of results of operations and financial condition (“MD&A”) is a supplement to the

accompanying consolidated financial statements and provides additional information on our businesses, current developments,

financial condition, cash flows and results of operations.

The following discussion should be read in conjunction with our

consolidated financial statements for the fiscal year ended October 2, 2022 provided in this Annual Report on Form 10-K.

statements contained herein may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform

These statements involve a number of risks, uncertainties and other factors that could cause actual results to differ

materially, as discussed more fully herein.

forward-looking information set forth in this Annual Report on Form 10-K is based on management’s current views and assumptions

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On April 27, 2020, we acquired substantially all the assets of Aggieland Safari LLC and related entities (“Aggieland

For additional information see “NOTE 3.

ACQUISITION” of the Notes to the Consolidated Financial Statements

included in this Annual Report on Form 10-K for additional information on this matter.

Parks are open year round but experience increased seasonal attendance, typically beginning in the latter half of March through early

As a result, our combined third and fourth quarter net sales have historically ranged from 68% to 72% of our annual attendance

based net sales.

For our 2021 fiscal year, the first full year including our Texas Park, combined third and fourth quarter net sales

were approximately 60% of our annual attendance based net sales

table below outlines our annual net sales, reported and adjusted income before income taxes, and net cash provided by operating activities

for the last five fiscal years.

During the past five fiscal years, our Georgia Park has benefitted from several positive factors including

strong and stable management, the addition of online ticket sales in June 2015, growth and positive economic conditions in the greater

Atlanta area, as well as positive guest perceptions of this Park.

Our strong results through fiscal 2019 and the resulting improvements

in our financial position provided us with the resources to pursue and ultimately complete the Aggieland Safari acquisition.

income before income taxes

parks are open year round, but experience increased seasonal attendance, typically beginning in the latter half of March through

early September.

Combined third and fourth quarter net sales were 62.1% and 60.3% of annual attendance based net sales for our 2022

and 2021 fiscal years, respectively.

Since the acquisition of our Texas Park, the combined third and fourth quarter concentration of

our sales has been reduced.

The table below outlines our annual net sales, reported

and adjusted income before income taxes, earnings before interest, taxes, depreciation and amortization (“EBITDA”), and net

cash provided by operating activities for the last five fiscal years.

For the past several years, our Georgia Park has benefitted from

a number of positive factors including strong and stable management, the addition of online ticket sales in June 2015, growth and positive

economic conditions in the greater Atlanta area, as well as positive guest perceptions of this park.

Our strong results through fiscal

2019 and the resulting improvements in our financial position provided us with the resources to pursue and ultimately complete the Aggieland

Safari acquisition.

Total net sales

Reported income before income taxes

% of total net sales

income before income taxes (*)

Adjusted income before income taxes (*)

% of total net sales

cash provided by operating activities

Net cash provided by operating activities

% of total net sales

- Excludes $189,988 gain on extinguishment of debt in 2021, $24,373 of tornado related insurance proceeds in 2020, $80,444 of tornado

damage asset write-offs and costs in 2019, $130,532 of deferred financing costs write-offs in 2018, and a $80,000 settlement gain in

rapid acceleration of the COVID-19 pandemic in the United States occurred at the beginning of our 2020 fiscal year annual high season.

We began to see a significant reduction in paid attendance at our Georgia and Missouri Parks beginning the week of March 9, 2020.

April 3, 2020, both Parks were closed as a result of shelter-in-place mandates in Georgia and Missouri.

Also note that prior to our acquisition

of our Texas Park, its operations were suspended for the majority of April 2020 due to a shelter-in-place mandate in Texas.

compliance with respective state issued guidelines, our Georgia Park and our Texas Park each reopened on May 1, 2020, and our Missouri

Park reopened on May 4, 2020.

Attendance levels were strong at each of our three Parks for the balance of our 2020 fiscal year, which

continued throughout our 2021 fiscal year, compared to pre-COVID 19 comparable periods.

While attendance based net sales remained strong

versus the comparable pre-COVID-19 period, we experienced a year-over-year decline in attendance based net sales and attendance during

the final 22 weeks of our 2021 fiscal year versus the comparable period of our 2020 fiscal year.

We believe the increased attendance

levels each of our Parks has experienced since reopening in early May 2020 reflects the principally outdoor nature of the family-friendly,

wild animal education and entertainment experience provided at each of our Parks.

The experience offered at each of our Parks is particularly

attractive during the COVID-19 pandemic as potential guests are seeking outdoor entertainment options.

While we have seen many repeat

customers since reopening in early May 2020, we also experienced an increase in first time visitors seeking an outdoor entertainment

We believe this has increased the local and regional awareness for each of our Parks, which we believe will have positive

longer-term ramifications for our business.

there remains the possibility of longer-term negative impacts to our business, results of operations and cash flows, and financial condition,

as a result of the COVID-19 pandemic.

These negative impacts may include changes in customer behavior and preferences causing significant

volatility or reductions in attendance at one or more of our Parks, increases in operating expenses to comply with additional hygiene-related

protocols, limitations in our ability to recruit and maintain staffing, limitations on our employees ability to work and travel, and

significant changes in the economic or political conditions in the areas our Parks are located.

Despite our efforts to manage these potential

impacts, the ultimate impact may be material, and will depend on a number of factors beyond our control, including the duration and severity

of the COVID-19 pandemic, the outbreak of new variants of the COVID-19 virus, and actions by governmental authorities taken to contain

its spread and mitigate its public health effects.

There is also the potential for attendance levels at our Parks to moderate or decline

as alternative entertainment venues reopen to full capacity once the COVID-19 pandemic has run its course or vaccines are widely adopted

and proven effective.

are committed to leveraging the strong operating model we have established at our Georgia Park, with a focus on increasing attendance,

as well as increasing the average revenue generated per guest visit via concession and gift shop revenues.

Among our highest priorities

over the next several years is continuing the integration of our Texas Park.

- Excludes a $100,000 legal settlement charge in 2022, a $189,988 gain on extinguishment of debt in 2021, $24,373 of tornado related

insurance proceeds in 2020, $80,444 of tornado damage asset write-offs and costs in 2019, and $130,532 of deferred financing costs write-offs

EBITDA is not a measurement of operating performance

computed in accordance with generally accepted accounting principles (“GAAP”) and should not be considered as a substitute

for operating income, net income or cash flows from operating activities computed in accordance with GAAP.

We believe that EBITDA is a

meaningful measure as it is widely used by analysts, investors and comparable companies in our industry to evaluate our operating performance

on a consistent basis, as well as more easily compare our results with those of other companies in our industry.

We also believe EBITDA

is a meaningful measure of park-level operating profitability.

EBITDA is a supplemental measure of our operating results and is not intended

to be a substitute for operating income, net income or cash flows from operating activities as defined under GAAP.

following table provides a reconciliation of our reported income before income taxes to our EBITDA for our five most recent fiscal years:

Reported income before income taxes

Interest expense

Depreciation and amortization

(Gain) loss on disposal of operating assets, net

Legal settlement

Gain on extinguishment of debt

Tornado damage and expenses, net

Write-off of loan fees - prepayment

response to the outbreak of the COVID-19 pandemic, governmental authorities throughout the United States implemented a variety of

containment measures with the objective of slowing the spread of the virus, including travel restrictions, shelter-in-place orders

and business shutdowns.

We implemented several measures to mitigate the impacts of the pandemic on our business and financial

During the initial shutdown period, we reduced staffing, applied for and received Paycheck Protection Program

(“PPP”) loans and reduced discretionary spending.

In addition, we delayed closing the Texas Park acquisition to

renegotiate various terms, primarily focused on reducing the cash requirements of the acquisition in the subsequent year.

early April 2020, our Georgia and Missouri Parks closed to the public due to shelter-in-place mandates.

In addition, our Texas Park,

was closed to the public for the month prior to its acquisition, due to a shelter-in-place mandate.

In compliance with respective state

issued guidelines, each of our parks reopened in early May 2020.

After reopening, attendance levels increased significantly at each of

our parks for the balance of our 2020 fiscal year, which continued throughout our 2021 fiscal year in comparison to comparable pre-COVID-19

We experienced a decline in comparable year-over-year attendance based net sales and attendance for the last 22 weeks of our

2021 fiscal year and for our entire 2022 fiscal year, respectively.

we experienced a comparable 52-week attendance-based sales decline for our 2022 fiscal year compared to the elevated pandemic levels,

our overall sales remain at significantly higher levels when compared to pre-COVID-19 periods.

On a combined basis, attendance-based

sales of our Georgia and Missouri Parks for our 2022 fiscal year were up approximately 43.0% compared to the comparable pre-COVID-19

2019 fiscal year, which we believe illustrates a significant increase in local and regional awareness of each park, a critical development

with positive long-term ramifications for our business.

(Note, our Texas Park, acquired on April 27, 2020, originally opened in May 2019;

therefore, a full year of sales is not available for pre-COVID-19 periods).

we have experienced attendance gains and strong cash flows subsequent to the reopening our of parks after the initial closures at the

beginning of the pandemic, there may be longer-term negative impacts to the Company’s business, results of operations and cash

flows, and financial condition as a result of the COVID-19 pandemic.

These negative impacts may include changes in customer behavior

and preferences, increases in operating expenses to meet consumer expectations and perceptions, limitations in our ability to recruit

and maintain staffing, as well as increasing wages required retain and recruit staff.

There is also the potential for attendance levels

at our parks to moderate or decline as alternative entertainment venues are now open and consumers have broader travel and entertainment

are committed to leveraging the strong operating model we have established at our Georgia Park at all three of our properties, with a

focus on increasing attendance through enhanced marketing efforts and focused capital investments, as well as continuing to prudently

increase the average revenue generated per guest visit via concession and gift shop revenues.

Among our highest priorities over the next

several years is continuing the integration of our Texas Park, continual enhancement of the overall guest experience at each of our parks,

as well as the introduction new programming and enhanced marketing efforts.

As our Texas Park first opened to the public in May 2019,

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on leveraging the increased exposure of this facility to continue to build on this recent success.

our 2021 fiscal year, we engaged an experienced amusement industry consulting firm to assist us in developing a master plan for our Georgia

Our 2022 fiscal year capital plan includes the first major project within that master plan, an impressive giraffe exhibit.

exhibit will be a new showcase for our Georgia Park, allowing our guests to encounter our giraffes regardless of weather conditions or

outside temperatures.

In aggregate, our 2022 fiscal year capital investment plan involves nearly $3.0 million of improvements across

all three of our parks.

This significant increase in capital investment spending will be fully funded from our existing cash, and

demonstrates our commitment to building for long-term, sustainable growth.

long-term business plan includes expansion via the acquisition of additional local or regional theme parks and attractions, if attractive

opportunities arise.

We believe acquisitions, if any, should not unnecessarily encumber the Company with additional debt that cannot

be justified by current operations.

2023 fiscal year capital investment plan remains elevated versus historical levels, however, is lower than the $1.84 million record level

of capital spending during our 2022 fiscal year.

Our 2023 capital plan targets substantial guest-facing enhancements at all three of

our parks, delivering a marketable attraction at each property and setting the stage for longer-term master planning and optimization

at every park.

Our plan to open a significant new giraffe exhibit at our Georgia Park during our 2022 fiscal year experienced delays

due to a highly inflationary period for building materials and a challenging labor market.

We remain committed to this showcase attraction

and expect to make progress on this project during our 2023 fiscal year, however the opening date is still unknown.

Our 2023 projected

capital investment spending will again be fully funded from our existing cash and continues to demonstrate our commitment to building

for long-term, sustainable growth.

long-term business plan also includes expansion via the acquisition of additional local or regional theme parks and attractions.

acquisitions, if any, should not unnecessarily encumber the Company with additional debt that cannot be justified by current operations.

We may also pursue contract management opportunities for themed attractions owned by third parties.

By using a combination of equity, debt and other financing options, we intend to carefully monitor stockholder value in conjunction with

the pursuit of growth.

growth in our annual operating cash flow over the past five to six fiscal years has provided us with incremental cash flow, and provided

us with the financial strength to complete the Aggieland Safari acquisition.

However, our current size and operating model leave us little

room for error.

Any future capital raised by us is likely to result in dilution to existing stockholders.

It is possible that cash generated

by, or available to, us may not be sufficient to fund our capital and liquidity needs for the near-term.

and Segment Results of Operations for the Year Ended October 3, 2021 as Compared to the Year Ended September 27, 2020

By using a combination of equity,

debt and other financing options, we intend to carefully monitor stockholder value in conjunction with the pursuit of growth.

annual operating cash flow over the past several fiscal years has provided us with incremental cash flow, provided us with the financial

strength to complete the Aggieland Safari acquisition and has funded a significant increase in capital investment.

However, our current

size and operating model leave us little room for error.

Any future capital raised by us is likely to result in dilution to existing

stockholders.

It is possible that cash generated by, or available to, us may not be sufficient to fund our capital and liquidity needs

for the near-term.

and Segment Results of Operations for the Year Ended October 2, 2022 as Compared to the Year Ended October 3, 2021

manage our operations on an individual location basis.

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2022 fiscal year was comprised of 52-weeks, compared to our 2021 fiscal year which was comprised of 53-weeks.

Furthermore, our Texas

Park was acquired on April 27, 2020, as such was included in our 2020 fiscal year reported results for a partial year.

Therefore, in

addition to full year reported attendance based sales comparisons, attendance based sales analyses will include comparable 53-week pro

forma sales comparisons as if our Texas Park were acquired at the beginning of our 2020 fiscal year.

following table shows our consolidated and segment operating results for the years ended October 3, 2021 and September 27, 2020:

income (loss) from operations

Therefore, in addition

to full year reported attendance based sales comparisons, attendance based sales analyses will include comparable 52-week sales comparisons.

following table shows our consolidated and segment operating results for the years ended October 2, 2022 and October 3, 2021:

Total net sales

Segment income (loss) from

operating margin %

on extinguishment of debt

Corporate expenses

Other income, net

Legal settlement

Gain on extinguishment of debt

before income taxes

Company’s total net sales for the year ended October 3, 2021 increased by $2.35 million or 24.8%, to $11.86 million compared to

$9.51 million for the year ended September 27, 2020.

Our Parks’ combined attendance based net sales increased by $2.21 million

or 23.5%, and animal sales increased by $140,555.

On a comparable 53-week pro forma basis, our attendance based net sales increased by

$1.36 million or 13.3%.

a reported basis, our Georgia Park’s attendance based net sales increased by $1.10 million or 16.2%, to $7.95 million, our Missouri

Park’s attendance based net sales increased by $338,839 or 23.7%, to $1.77 million, and our Texas Park’s attendance based

sales increased by $770,094 to $1.94 million.

a comparable 53-week basis, our Georgia Park’s attendance based net sales increased by $973,189 or 14.0% and our Missouri Park’s

attendance based net sales $313,720 or 21.6%.

On a comparable 53-week pro forma basis, our Texas Park’s attendance based sales

increased approximately $76,966 or 4.1%

comparable 53-week basis, paid attendance at our Missouri Park increased by approximately 11.7%, while paid attendance at our

Georgia Park declined by approximately 4.5%.

On a comparable 53-week pro forma basis paid attendance at our Texas Park increased by approximately

Company’s total net sales for the year ended October 2, 2022 decreased by $1.12 million, to $10.74 million compared to

$11.86 million for the year ended October 3, 2021.

Our Parks’ combined attendance based net sales decreased by $1.05 million or

9.0%, and animal sales decreased by $75,607.

On a comparable 52-week basis, our attendance based net sales decreased by $848,862 or 7.4%.

a reported basis, our Georgia Park’s attendance based net sales decreased by $881,252 or 11.1%, to $7.07 million, our Missouri

Park’s attendance based net sales decreased by $101,592 or 5.7%, to $1.67 million, and our Texas Park’s attendance based

sales decreased by $62,623 or 3.2%, to $1.88 million.

a comparable 52-week basis, our Georgia Park’s attendance based net sales decreased by $748,701 or 9.6%, our Missouri Park’s

attendance based net sales decreased by $76,473 or 4.4%, and our Texas Park’s attendance based sales decreased by $23,688 or 1.2%.

On comparable 52-week basis, paid attendance at our Georgia Park decreased by approximately 17.9%, paid attendance our Missouri Park

decreased by approximately 15.7%, while paid attendance at our Texas Park increased by approximately 2.2%.

Operating Margin

consolidated segment operating margin increased $24,646, resulting in segment income from operations of $4.66 million for the year ended

October 3, 2021 compared to segment income from operations of $4.63 million for the year ended September 27, 2020.

consolidated segment operating margin decreased $2.36 million, resulting in segment income from operations of $2.30 million for the year

ended October 2, 2022 compared to segment income from operations of $4.66 million for the year ended October 3, 2021.

Our Georgia Park’s

segment income was $4.52 million, an increase of $403,723, principally as a result of higher attendance based net sales and higher animal

sales, partially offset by higher cost of sales, as well as higher compensation and general operating expenses.

Our Missouri Park generated

a segment operating income of $202,597, an increase of $117,761.

Excluding an insurance recovery of $24,373 for tornado damage during

our 2020 fiscal year, our Missouri Park’s segment operating income increased by $142,134, primarily as a result of higher attendance

based net sales, partially offset by higher cost of sales, and higher compensation and general operating expenses.

Our Texas Park generated

a segment loss of $62,922 for the year ended October 3, 2021, compared to segment income of $433,916 after its acquisition on April 27,

2020, resulting in a net decrease of $496,838.

This decrease is primarily attributable higher cost of sales, higher compensation,

advertising and general operating expenses, as well as higher depreciation expense, partially offset by higher attendance based net sales

and higher animal sales.

spending increased by $112,465 to $896,136 during the year ended October 3, 2021, primarily due to the hiring of an Executive Vice President

of Operations and higher travel expenses, partially offset by lower professional fees.

income, net, was $65,314 for the year ended October 3, 2021, an increase of $37,526, primarily attributable to a full year of

mineral rights royalty income for our Texas Park, partially offset by lower interest income.

segment income was $2.90 million, a decrease of $1.62 million, principally attributable to lower attendance based net sales and lower

animal sales, as well as higher compensation and benefits, advertising, insurance and general operating expenses, partially offset by

higher margins on gift shop and food service sales.

Our Missouri Park generated a segment operating loss of $344,404, a net decrease

of $547,001, primarily attributable to lower attendance based net sales, as well as higher special event, advertising, compensation,

depreciation and general operating expenses, partially offset by gains on asset dispositions.

Our Texas Park generated a segment loss

of $254,834, an increase of $191,912, primarily attributable lower attendance based net sales, as well as higher advertising, benefits,

insurance, depreciation and general operating expenses, partially offset by higher animal sales, higher margins on gift shop and food

service sales, and lower losses on asset dispositions.

spending increased by $99,810 to $995,946 during the year ended October 2, 2022, primarily due to higher professional fees, compensation

and benefits, travel and insurance expenses.

Settlement Charge

August 5, 2022, we agreed to pay $100,000 to two children of a former officer of the Company to settle a complaint alleging we were obligated

to purchase life insurance of at least $540,000 for said officer.

The release was obtained, and the full payment was made prior to October

For additional information, see “N ote 8.

AND CONTINGENCIES ” of the Notes to the Consolidated Financial Statements included in this Annual Report on Form 10-K.

income, net, was $91,276 for the year ended October 2, 2022, an increase of $25,962, primarily attributable to higher mineral rights

royalty income for our Texas Park.

on Extinguishment of Debt

the year ended October 3, 2021, we received notification the SBA approved both our Wild Animal – Georgia and Wild Animal –

Missouri Paycheck Protection Program (“PPP”) loan forgiveness applications, resulting in a gain on extinguishment of debt

totaling $189,988.

expense for the year ended October 3, 2021 was $335,944, an increase of $153,018, primarily as a result of debt incurred related to the

acquisition of our Texas Park on April 27, 2020, partially offset by a lower interest rate associated with the June 2021 refinancing

of our Synovus Bank (“Synovus”) term loan.

the year ended October 3, 2021, we received notification the SBA approved both of our PPP loan forgiveness

applications, resulting in a gain on extinguishment of debt totaling $189,988.

expense for the year ended October 2, 2022 was $261,621, a decrease of $74,323, primarily as a result of the lower interest rate associated

with the June 2021 refinancing of our Synovus term loan and scheduled principal payments on our term loans over the trailing 12 month

period, as well as the retirement of the Aggieland Seller Note in June 2021.

the year ended October 2, 2022, we generated income before income taxes of $1.03 million and recorded a tax provision of $302,800, for

an effective tax rate of approximately 24.0%, which was favorably impacted by the non-taxable PPP loan forgiveness.

For the year ended

September 27, 2020, we generated income before income taxes of $3.69 million and recorded a tax provision of $926,400, for an effective

tax rate of approximately 25.1%.

additional information, see “N ote 8.

an effective tax rate of approximately 29.4%, which was unfavorably impacted by state income taxes due to operating losses for our Missouri

and Texas Parks.

For the year ended October 3, 2021, we generated income before income taxes of $3.68 million and recorded a tax provision

of $882,000, for an effective tax rate of approximately 24.0%, which was favorably impacted by the non-taxable PPP loan forgiveness.

For additional information, see “N ote 7.

Taxes ” of the Notes to the Consolidated Financial Statements included in this Annual Report on Form 10-K.

Income and Income Per Share

reported net income for the year ended October 3, 2021 was $2.80 million or $0.04 per basic share and per fully diluted share, an increase

of $31,077 as compared with reported net income of $2.77 million or $0.04 per basic share and per fully diluted share, for the

year ended September 27, 2020.

the year ended

on extinguishment of debt

damage and expenses, net

impact - tornado damage and expenses

reported net income for the year ended October 2, 2022 was $727,491 or $0.01 per basic share and per fully diluted share, a decrease

of $2.07 million or $0.03 per basic and fully diluted share, as compared with reported net income of $2.80 million or $0.04 per basic

share and per fully diluted share, for the year ended October 3, 2021.

For the year ended

October 2, 2022

October 3, 2021

Legal settlement

Tax impact - legal settlement

Gain on extinguishment of debt

Adjusted net income

shown in the table above, several one-time items impacted our year-over-year reported net income comparison.

Our 2021 fiscal year included

a gain on extinguishment of debt totaling $189,988.

Our 2020 fiscal year included an insurance recovery of $24,373 associated with tornado

damages at our Missouri Park.

Management believes that adjusted net income, excluding one-time items, should be considered in evaluating

the ongoing operating performance of our business.

Excluding the after-tax effect of these items, our 2021 and 2020 fiscal year adjusted

net income would have been $2.61 million and $2.75 million, respectively, resulting in a decrease in adjusted net income of $139,658.

The decrease in our adjusted net income is attributable to a $496,838 decline in the segment income generated by our Texas Park, a $112,465

increase in Corporate expenses, and a $153,018 increase in interest expense, partially offset by a $403,723 increase in segment income

for our Georgia Park, a $142,134 increase in the segment income of our Missouri Park, a $37,526 increase in other income and a $39,280

decrease in our income tax provision.

Our 2022 fiscal year

included a legal settlement charge of $100,000.

Our 2021 fiscal year included a gain on extinguishment of debt totaling $189,988.

Management believes that adjusted net income, excluding one-time items, should be considered in evaluating the ongoing operating

performance of our business.

Excluding the after-tax effect of these items, our 2022 and 2021 fiscal year adjusted net income would

have been $800,491 and $2.61 million, respectively, resulting in a decrease in adjusted net income of $1.81 million.

The decrease in

our adjusted net income is attributable to a $1.62 million decrease in the segment income for our Georgia Park, a $547,001 net

decline in the segment income for our Missouri Park, a $191,912 increase in the segment loss for our Texas Park, a $99,810 increase

in Corporate expenses, partially offset by a $74,323 decrease in interest expense, a $25,962 increase in other income and a $552,200

decrease in our adjusted income tax provision.

Condition, Liquidity and Capital Resources

12 unchanged sentences

loan in the original principal amount of $1.60 million at 5.00% per annum and a $350,000 line of credit at 4.75% per annum.

off the balance outstanding on the 2018 Term Loan, the net additional borrowings on the 2021 Term Loan were $930,222

and the line of credit was not renewed.

Combined with available cash, we used the incremental proceeds from the 2021 Term Loan to paydown

$1.0 million of the 2020 Term Loan used to finance our Texas Park acquisition, which has a 5.00% annual interest rate.

Overall, we estimate

this refinancing will generate approximately $24,375 in annual interest savings.

working capital was $5.70 million as of October 3, 2021, compared to $3.86 million as of September 27, 2020.

The year-over-year increase

in working capital primarily reflects cash flow provided by operating activities, partially offset by capital investments, the payoff

of the Aggieland Seller Note, as well as net term debt payments during our 2021 fiscal year.

loan debt, including current maturities, as of October 3, 2021 was $5.66 million compared to $7.02 million as of September 27, 2020.

The year-over-year decrease in total loan debt is the result of the payoff of the Aggieland Seller Note, the forgiveness of our PPP loans

and net term debt payments during our 2021 fiscal year.

Our bank line of credit (“LOC”) was terminated effective June 18,

2021 and there were no borrowings on the LOC as of September 27, 2020.

off the balance outstanding on the 2018 Term Loan, the net additional borrowings on the 2021 Term Loan were $930,222 and the line of

credit was not renewed.

Combined with available cash, we used the incremental proceeds from the 2021 Term Loan to paydown $1.0 million

of the 2020 Term Loan used to finance our Texas Park acquisition, which has a 5.00% annual interest rate.

Overall, we estimate this refinancing

will generate approximately $24,375 in annual interest savings.

working capital was $4.67 million as of October 2, 2022, compared to $5.70 million as of October 3, 2021.

The year-over-year decrease

in working capital primarily reflects cash used for capital investments and scheduled term loan payments, partially offset by cash generated

by operating activities during our 2022 fiscal year.

loan debt, including current maturities, as of October 2, 2022 was $4.96 million compared to $5.66 million as of October 3, 2021.

year-over-year decrease in total loan debt the result scheduled term loan payments during our 2022 fiscal year.

of October 2, 2022, we had equity of $15.35 million and total loan debt of $4.96 million, resulting in a debt to equity ratio of 0.32

to 1.0, compared to 0.60 to 1.0 as of September 27, 2020.

to 1.0, compared to 0.39 to 1.0 as of October 3, 2021.

cash provided by operating activities was $1.54 million for our 2022 fiscal year, compared to $3.31 million, for our 2021 fiscal year,

resulting in a decrease of $371,683, primarily due to working capital uses.

2021 fiscal year included $988,901 of capital improvements, compared to $525,409 spent on capital improvements during our 2020

In addition, during our 2020 fiscal year we acquired Aggieland Safari, investing approximately $6.37 million of cash.

resulting in a decrease of $1.77 million, principally due to lower net income.

2022 fiscal year included $1.84 million of capital improvements, compared to $988,901 spent on capital improvements during our 2021 fiscal

year, representing an increase of $850,490.

our 2022 fiscal year, property and equipment investing at our Georgia Park included various animal acquisitions, additions to animal

shelters and exhibits, the addition of a guest party pavilion, enhancements to and expansion of our food service capabilities, improvements

to our gift shop, annual improvements to our drive-through roads, and spending on annual requirements for our rental vehicle fleet.

our Missouri Park, 2022 fiscal year property and equipment investments included various animal acquisitions, the addition of a new otter

exhibit scheduled to open in our 2023 fiscal year, renovations of various animal shelters and exhibits, ground and electrical improvements

to support a new Christmas Lights display, enhancements to and expansion of our food service capabilities, the addition of playground

equipment in the walkabout section, and the acquisition of various equipment.

For our Texas Park, 2022 fiscal year property and equipment

investments included various animal acquisitions, the addition of and enhancements to various animal shelters, the acquisition of several

vehicles for customer rental and related service equipment, other equipment additions, and various improvements focused on introducing

expanded food service operations, expected to fully launch in fiscal 2023.

our 2021 fiscal year, property and equipment investing at our Georgia Park included improvements to our drive-through road and other

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of various park equipment, drive through road improvements, and the acquisition of various animals.

our 2020 fiscal year, property and equipment investing at our Georgia Park included improvements to our drive-through roads, improvements

and additions to animal shelters and exhibits, spending on annual requirements for our rental vehicle fleet, and various animal acquisitions.

For our Missouri Park, 2020 fiscal year property and equipment investments included the completion of a new giraffe barn and primate

night house, various animal acquisitions, fencing improvements and the acquisition of various equipment.

For our Texas Park, 2020 fiscal

year property and equipment investments included various park maintenance equipment and animal acquisitions.

cash used in financing activities was $1.20 million for the year ended October 3, 2021, compared to net cash provided by financing activities

of $4.92 million for the year ended September 27, 2020.

cash used in financing activities was $866,193 for the year ended October 2, 2022, compared to $1.20 million for the year ended October

3, 2021, resulting in a decrease of $333,969.

our 2022 fiscal year, cash used in financing activities was for scheduled payments on our term loans, as well as principal payments on

a financing lease obligation prior to its termination in September 2022.

June 2021, we entered into the 2021 Term Loan for $1.95 million, using those proceeds to pay off the $1.02 million outstanding balance

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In addition, on June 29, 2021, we paid off the $750,000 Aggieland Safari Seller Note.

the $1.0 million prepayment of the 2020 Term Loan, net principal payments against our combined term loans totaled $448,648 for

the year ended October 3, 2021.

the year ended September 27, 2020, net cash provided by financing activities related to our Aggieland acquisition totaled $4.94 million,

cash provided by PPP loans totaled $188,087 was provided by PPP loans, while cash used for scheduled payments against our 2018 Term Loan

totaled $207,135.

Excluding the $1.0

million prepayment of the 2020 Term Loan, net principal payments against our combined term loans totaled $448,648 for the year ended

October 3, 2021.

June 18, 2021, through our wholly owned subsidiary Wild Animal – Georgia, we completed a refinancing transaction (the “2021

Refinancing”) with Synovus Bank (“Synovus”).

The 2021 Refinancing included a term loan in the original principal amount

of $1.95 million (the “2021 Term Loan”).

The 2021 Term Loan bears interest at a rate of 3.75% per annum and is payable in

monthly installments of approximately $26,480, based on a seven-year amortization period.

Refinancing”) with Synovus Bank.

The 2021 Refinancing included a term loan in the original principal amount of $1.95 million.

2021 Term Loan bears interest at a rate of 3.75% per annum and is payable in monthly installments of approximately $26,480, based on

a seven-year amortization period.

The 2021 Term Loan has a maturity date of June 18, 2028.

The 2021 Term Loan is secured by a security deed on the assets of Wild Animal – Georgia.

We paid a total of approximately

$1,514 in fees and expenses in connection with the 2021 Refinancing.

The outstanding balance of the 2021 Term Loan was $1.89 million

as of October 3, 2021.

April 27, 2020, we acquired Aggieland Wild Animal – Texas, financing the transaction with the 2020 Term Loan from First Financial

Bank (“First Financial”) and the Aggieland Seller Note.

The 2020 Term Loan in the original principal amount of $5.0 million

from First Financial is secured by substantially all the Aggieland Wild Animal – Texas assets, as well as guarantees from the

The 2021 Term Loan is secured by a security

deed on the assets of Wild Animal – Georgia.

We paid a total of approximately $1,514 in fees and expenses in connection with the

2021 Refinancing.

The outstanding balance of the 2021 Term Loan was$1.64 million as of October 2, 2022.

April 27, 2020, through our wholly owned subsidiary Aggieland-Parks Inc., we acquired Aggieland Wild Animal – Texas.

acquisition was financed with the “2020 Term Loan” from First Financial Bank (“First Financial”) and the

“Aggieland Seller Note ” (as defined below).

The 2020 Term Loan in the original principal amount of $5.0 million from

First Financial is secured by substantially all the Aggieland Wild Animal – Texas assets, as well as guarantees from the

Company and its subsidiaries.

The 2020 Term Loan bears interest at a rate of 5.0% per annum, has a maturity date of April 27, 2031, and

required interest only monthly payments through April 2021.

The 2020 Term Loan bears interest at a rate of 5.0% per annum, has a maturity date of April 27, 2031,

and required interest only monthly payments through April 2021.

The 2020 Term Loan requires monthly payments of approximately

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We paid a total of approximately $62,375 in fees and expenses in connection with the 2020 Term Loan.

On June 30, 2021, the Company used the incremental proceeds of the 2021 Term Loan, combined with additional funds, to paydown $1.0 million

against the 2020 Term Loan, which had an outstanding balance of $3.83 million as of October 3, 2021.

On June 30, 2021, the Company used the incremental proceeds of the 2021 Term Loan, combined with additional funds, to paydown $1.0

million against the 2020 Term Loan, which had an outstanding balance of $3.37 million as of October 2, 2022.

Aggieland Seller Note represented a deferred portion of the purchase price, had a face value of $750,000, bore no interest, had a maturity

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Effective March 29, 2021 and May 25, 2021, the SBA approved the Forgiveness Applications for Wild Animal – Georgia

and Wild Animal – Missouri, respectively, including forgiveness of accrued interest, resulting in a gain on extinguishment

of debt totaling $189,988 during the year ended October 3, 2021.

and Wild Animal – Missouri, respectively, including forgiveness of accrued interest, resulting in a gain on extinguishment of debt

totaling $189,988 during the year ended October 3, 2021.

November 14, 2022, Lisa Brady was appointed as the Company’s President and CEO, replacing Dale Van Voorhis, who had been

serving as interim President and CEO since June 1, 2022.

Among other duties, Ms.

Brady is responsible for

leading the day-to-day operations of the Company, evaluating and recommending strategic initiatives, as well as working with the

management team to implement and execute approved strategic growth initiatives.

Van Voorhis will continue as Chairman of the

Company’s Board of Directors and as a special advisor to Ms.

Balance Sheet Arrangements

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including those related to long-lived assets, revenue recognition, income taxes, and contingencies and litigation.

estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results

of which form the basis for making judgments about carrying values of assets and liabilities that are not readily apparent from other

Although actual results historically have not deviated significantly from those determined using our estimates, our results

of operations or financial condition could differ, perhaps materially, from these estimates under different assumptions or conditions.

We base our estimates

on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which

form the basis for making judgments about carrying values of assets and liabilities that are not readily apparent from other sources.

Although actual results historically have not deviated significantly from those determined using our estimates, our results of operations

or financial condition could differ, perhaps materially, from these estimates under different assumptions or conditions.

Assets, including Property and Equipment

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and therefore impaired.

recognize revenues when a performance obligation has been satisfied by transferring control of promised services or products to our guests/customers

in an amount that reflects the amount the Company has received or expects to receive in exchange for those services or products.

admission fee revenues from advance online ticket purchases are deferred until the customers’ visit to the parks.

Park admission

revenues for annual passes and memberships are deferred and recognized as revenue on a pro-rata basis over the term of the pass or membership.

Revenues from retail and concession sales are generally recognized upon the concurrent receipt of payment and delivery of goods to the

We recognize revenues when a performance obligation

has been satisfied by transferring control of promised services or products to our guests/customers in an amount that reflects the amount

we have received or expect to receive in exchange for those services or products.

Park admission revenues for annual passes and memberships

are deferred and recognized as revenue on a pro-rata basis over the term of the pass or membership.

Park admission fee revenues from advance

online ticket purchases are deferred until the customers’ visit to the parks.

Advance online tickets can generally be used anytime

during the one year period from the date of purchase.

Revenues from retail and concession sales are generally recognized upon the concurrent

receipt of payment and delivery of goods to the customer.

Sales taxes billed and collected are not included in revenue.

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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 7. Management’s Discussion and Analysis