2 unchanged sentences
Condensed Consolidated Balance Sheets
−Removed: June 30, 2024 December 31, 2023
+Added: September 30, 2024 December 31, 2023
Current assets:
Cash 962 1,354
−Removed: Accounts receivable, net of allowance for doubtful accounts of $ 0.3 million and $ 0.2 million as of June 30, 2024 and December 31, 2023, respectively
+Added: Accounts receivable, net of allowance for doubtful accounts of $ 0.8 million and $ 0.2 million as of September 30, 2024 and December 31, 2023, respectively
38,333 52,920
12 unchanged sentences
Accounts payable and accrued expenses 40,346 50,167
−Removed: Notes payable, current, net of discount of $ 0.1 million and $ 0.2 million as of June 30, 2024 and December 31, 2023, respectively
+Added: Notes payable, current, net of discount of $ 0.1 million and $ 0.2 million as of September 30, 2024 and December 31, 2023, respectively
Operating lease liability, current 22 385
8 unchanged sentences
Total liabilities 140,201 153,834
−Removed: Common stock, $ 0.0001 par value, 200,000,000 shares authorized, 45,965,155 and 40,464,720 shares issued and outstanding as of June 30, 2024 and December 31, 2023, respectively
+Added: Common stock, $ 0.0001 par value, 20,000,000 shares authorized, 5,020,373 and 4,046,472 shares issued and outstanding as of September 30, 2024 and December 31, 2023, respectively
Additional paid-in capital 111,650 107,992
9 unchanged sentences
Condensed Consolidated Statement of Operations and Other Comprehensive Income/ (Loss)
−Removed: Three Months Ended June 30, Six Months Ended June 30,
+Added: Three Months Ended September 30, Nine Months Ended September 30,
2024 2023 2024 2023
7 unchanged sentences
Gross profit 2,463 2,905 4,635 10,654
+Added: Impairment of goodwill — ( 828 ) — ( 828 )
+Added: Impairment of intangible assets — ( 810 ) — ( 810 )
Depreciation and amortization expenses ( 49 ) ( 443 ) ( 421 ) ( 1,517 )
6 unchanged sentences
Other income — 1 19 252
−Removed: Interest expense ( 761 ) ( 22 ) ( 1,251 ) ( 19 )
+Added: Interest expense, net ( 1,718 ) ( 301 ) ( 2,969 ) ( 320 )
Change in fair value of stock-based compensation 1,001 297 2,691 1,161
−Removed: Gain on fair value remeasurement 3,275 — 6,534 —
+Added: Warrant modification expense — ( 958 ) — ( 958 )
+Added: Gain / (loss) on fair value remeasurement 5,461 ( 349 ) 11,995 ( 349 )
Gain on sale of trading securities — — 518 —
15 unchanged sentences
(Unaudited) (Continued)
−Removed: Three Months Ended June 30, Six Months Ended June 30,
+Added: Three Months Ended September 30, Nine Months Ended September 30,
2024 2023 2024 2023
6 unchanged sentences
Total comprehensive income / (loss) 1,089 ( 5,295 ) 2,911 ( 6,171 )
−Removed: Comprehensive income attributable to non-controlling interest 52 — 100 —
+Added: Comprehensive loss attributable to non-controlling interest 69 112 169 112
Total Comprehensive income / (loss) attributable to Sadot Group Inc.
19 unchanged sentences
Balance at June 30, 2023 3,591,145 — 103,395 ( 80,231 ) — — 23,164
+Added: Common stock compensation to board of directors 3,289 — 39 — — — 39
+Added: Common stock issued as compensation for services 81,558 — 654 — — — 654
+Added: Cash exercise of warrants and warrant modification 215,331 — 3,111 — — — 3,111
+Added: Stock-based compensation - options — — 27 — — — 27
+Added: Investment in non-controlling interest — — — — — 3,654 3,654
+Added: Net loss — — — ( 5,183 ) — ( 112 ) ( 5,295 )
+Added: Balance at September 30, 2023 3,891,323 — 107,226 ( 85,414 ) — 3,542 25,354
+Added: See Accompanying Notes to the Condensed Consolidated Financial Statements (Unaudited)
+Added: Sadot Group Inc.
+Added: Condensed Consolidated Statement of Changes in Stockholders' Equity
+Added: (Unaudited) (Continued)
+Added: Common Stock Additional
+Added: Capital Accumulated
+Added: Deficit Accumulated Other Comprehensive Income / (Loss) Non-controlling Interest Total
+Added: Shares Amount
+Added: $’000 $’000 $’000 $’000 $’000 $’000
Balance at December 31, 2023 4,046,472 — 107,992 ( 87,179 ) 8 3,436 24,257
3 unchanged sentences
Stock based compensation - vesting of options and restricted stock awards 23,913 — 111 — — — 111
+Added: Foreign exchange translation adjustment — — — — — — —
Unrealized loss, net of income tax — — — — ( 60 ) 0 ( 60 )
8 unchanged sentences
Balance at June 30, 2024 4,596,508 — 109,966 ( 85,075 ) ( 175 ) 3,336 28,052
+Added: Common stock compensation to board of directors — — — — — — —
+Added: Common stock issued as compensation for services 168,649 — 723 — — — 723
+Added: Conversion of convertible loan 221,779 1 819 — — — 820
+Added: Stock based compensation - vesting of options and restricted stock awards 33,177 — 142 — — — 142
+Added: Foreign exchange translation adjustment — — — — ( 4 ) — ( 4 )
+Added: Unrealized loss, net of income tax — — — — ( 1 ) — ( 1 )
+Added: Reconciliation of post-split shares outstanding per transfer agent 260 — — — — — —
+Added: Net income / (loss) — — — 1,163 — ( 69 ) 1,094
+Added: Balance at September 30, 2024 5,020,373 1 111,650 ( 83,912 ) ( 180 ) 3,267 30,826
See Accompanying Notes to the Condensed Consolidated Financial Statements (Unaudited)
1 unchanged sentence
Condensed Consolidated Statements of Cash Flows
−Removed: Six Months Ended June 30,
+Added: Nine Months Ended September 30,
Cash Flows from Operating Activities
1 unchanged sentence
Adjustments to reconcile net income / (loss) to net cash used in operating activities:
+Added: Impairment of goodwill — 828
+Added: Impairment of intangible assets — 810
Depreciation and amortization 421 1,517
1 unchanged sentence
Change in fair value of compensation ( 2,691 ) ( 1,161 )
+Added: Warrant modification expense — 958
Unrealized loss, net of income tax ( 187 ) —
17 unchanged sentences
Deposit on farmland ( 5,853 ) 4,914
+Added: Investment from non-controlling interest — 3,655
Purchases of property and equipment ( 38 ) ( 12,447 )
Disposal of property and equipment 462 208
−Removed: Net cash used in investing activities ( 646 ) ( 4,025 )
+Added: Net cash provided by / (used in) investing activities ( 5,429 ) ( 3,670 )
Cash Flows from Financing Activities
Proceeds from notes payable 4,569 7,684
+Added: Proceeds from exercise of warrants — 2,153
Repayments of notes payable ( 6,512 ) ( 4,964 )
6 unchanged sentences
Condensed Consolidated Statements of Cash Flows (Continued)
−Removed: Six Months Ended June 30,
+Added: Nine Months Ended September 30,
Supplemental Disclosures of Cash Flow Information:
Cash paid for interest 3,111 346
−Removed: Transfer to assets held for sale 6,335 —
+Added: Cash paid for taxes 19 —
+Added: Supplemental Disclosures of Non-Cash Investing and Financing Activities
+Added: Conversion of notes payable into common stock 1,784 —
See Accompanying Notes to the Condensed Consolidated Financial Statements (Unaudited)
3 unchanged sentences
Sadot Group Inc.
−Removed: ("Sadot Group" or "SGI" or together with its subsidiaries, the “Company”) (f/k/a Muscle Maker, Inc.), a Nevada corporation was incorporated in Nevada on October 25, 2019.
+Added: ("Sadot Group" or "SGI" or together with its subsidiaries, the “Company”), a Nevada corporation was incorporated in Nevada on October 25, 2019.
In late 2022, SGI transformed from a U.S.-centric restaurant business into a global organization focused on the Agri-food commodity supply chain.
Effective July 27, 2023, we changed our company name from Muscle Maker, Inc., to Sadot Group Inc.
−Removed: Sadot Group is headquartered in Ft.
−Removed: Worth, Texas with subsidiary operations throughout the United States, Brazil, Canada, Colombia, Dubai, India, Israel, Singapore, Ukraine and Zambia.
−Removed: As of June 30, 2024, SGI consisted of two distinct operating units:
+Added: Sadot Group is headquartered in Burleson, Texas with subsidiary operations throughout the United States, Brazil, Canada, Colombia, India, Israel, Singapore, Ukraine, United Arab Emirates and Zambia.
+Added: As of September 30, 2024, SGI consisted of two distinct operating units:
Sadot LLC (“Sadot Agri-Foods”):
−Removed: Sadot Group’s largest operating unit is a global Agri-Foods company engaged in farming, commodity trading and shipping of food and feed (e.g., soybean meal, wheat and corn) via dry bulk cargo ships to/from markets such as Argentina, Australia, Bangladesh, Brazil, Canada, China, Columbia, Costa Rica, Dominican Republic, Ecuador, Egypt, Guinea, Honduras, India, Indonesia, Ivory Coast, Japan, Kenya, Malaysia, Morocco, Mozambique, Nigeria, Philippines, Poland, Romania, Saudi Arabia, South Korea, Sri Lanka, Ukraine, United States, Venezuela, Vietnam and Yemen, among others.
+Added: Sadot Group’s largest operating unit is a global Agri-Foods company engaged in farming, commodity trading and shipping of food and feed (e.g., soybean meal, wheat and corn) via dry bulk cargo ships across the globe.
Sadot Agri-Foods competes with the ABCD commodity companies (ADM, Bunge, Cargill, Louis-Dreyfus) as well as many regional organizations.
4 unchanged sentences
has three unique “healthier for you” concepts, including two fast casual restaurant concepts, Pokémoto and Muscle Maker Grill, as well as one subscription-based fresh prep meal concept, SuperFit Foods.
+Added: SuperFit Foods was sold in August 2024.
The restaurants were founded on the belief of taking every-day menu options and converting them into “healthier for you” menu choices with the goal of satisfying consumers demand for healthier choices, customization, flavor and convenience.
−Removed: Each of our three concepts offers different menus that are tailored to specific consumer segments.
+Added: Each of our concepts offers different menus that are tailored to specific consumer segments.
We believe our concepts deliver highly differentiated customer experiences.
2 unchanged sentences
Recent Corporate Developments
−Removed: Effective July 27, 2023, the Company changed its name from Muscle Maker, Inc.
−Removed: to Sadot Group Inc.
−Removed: The name change was made in accordance with Section 92A.180 of the Nevada Revised Statutes by merging a wholly-owned subsidiary of the Company with and into the Company, with the Company being the surviving corporation in the merger.
−Removed: The Company effectuated the merger by filing Articles of Merger with the Secretary of State of the State of Nevada.
−Removed: In connection with the merger, the Company amended Article I of its Articles of Incorporation to change the Company’s corporate name to Sadot Group Inc.
−Removed: With the exception of the name change, there were no other changes to the Company’s Articles of Incorporation.
−Removed: Additionally, as of the opening of trading on July 27, 2023, the ticker symbol of the Company’s common stock on The Nasdaq Capital Market was changed to “SDOT” and the CUSIP number of the Company’s common stock (627333107) remained unchanged.
−Removed: The Company’s name and ticker symbol change do not affect the rights of the Company’s security holders, creditors, customers or suppliers.
−Removed: Following the name change, any stock certificates that reflect the Company’s prior name, if any, continue to be valid.
−Removed: In the first quarter of 2024, the Company classified its Sadot Food Services segment as held for sale.
−Removed: See Note 3 – Assets held for sale for additional information.
+Added: On October 9, 2024, the Company filed a Certificate of Change Pursuant to NRS 78.209 with the Nevada Secretary of State to effect a reverse stock split of the Company’s common stock at a ratio of one for- ten (the “Reverse Stock Split”), which became effective 12:01 am eastern on October 18, 2024.
+Added: As a result of the Reverse Stock Split, every 10 shares of the Company’s common stock issued and outstanding on the effective date were consolidated into one issued and outstanding share.
+Added: All stockholders who were entitled to receive fractional shares as a result of the Reverse Stock Split received one whole share for their fractional share interest.
+Added: There was no change in the par value of the Company's common stock.
The Company's primary source of liquidity is cash on hand.
−Removed: As of June 30, 2024, the Company had a cash balance, a working capital surplus and an accumulated deficit of $ 10.0 million, $ 16.1 million, and $ 85.1 million, respectively.
−Removed: During the three and six months ended June 30, 2024, the Company generated Pre-tax net income of $ 2.3 million and $ 2.0 million,
+Added: As of September 30, 2024, the Company had a cash balance, a working capital surplus and an accumulated deficit of $ 1.0 million, $ 18.9 million, and $ 83.9 million, respectively.
+Added: During the three and nine months ended September 30, 2024, the Company generated Pre-tax net income of $ 1.1 million and $ 3.1 million, respectively.
+Added: The Company had Net cash provided by operations of $ 7.0 million for the nine months ended September 30, 2024.
+Added: The Company believes that our existing cash on hand, current accounts receivable and future cash flows from our commodity trading, farming and franchise operations, will be sufficient to fund our operations, anticipated capital expenditures and repayment obligations over the next 12 months.
Sadot Group, Inc.
Notes to the Condensed Consolidated Financial Statements (Unaudited)
−Removed: respectively.
−Removed: The Company had Net cash provided by operations of $ 11.0 million for the six months ended June 30, 2024.
−Removed: The Company believes that our existing cash on hand, current accounts receivable and future cash flows from our commodity trading, farming and franchise operations, will be sufficient to fund our operations, anticipated capital expenditures and repayment obligations over the next 12 months.
−Removed: In addition, the Company has access to additional liquidity if it is needed through an executed Standby Equity Purchase Agreement ("SEPA") for up to $ 25 million in capital whereby the Company may submit advance requests to the lender and the lender will provide cash in consideration of shares of common stock subject to certain limitations and conditions set forth in the SEPA.
Working Capital
We measure our liquidity in a number of ways, including the following:
−Removed: June 30, 2024 December 31, 2023
+Added: September 30, 2024 December 31, 2023
Cash 962 1,354
21 unchanged sentences
Accordingly, they do not include all of the information and disclosures required by accounting principles generally accepted in the United States of America for annual financial statements.
−Removed: In the opinion of management, such statements include all adjustments (consisting only of normal recurring items) which are considered necessary for a fair presentation of the Unaudited Condensed Consolidated Financial Statements of the Company as of June 30, 2024, and for the three and six months ended June 30, 2024, and 2023.
−Removed: The results of operations for the three and six months ended June 30, 2024, and 2023 are not necessarily indicative of the operating results for the full year.
+Added: In the opinion of management, such statements include all adjustments (consisting only of normal recurring items) which are considered necessary for a fair presentation of the Unaudited Condensed Consolidated Financial Statements of the Company as of September 30, 2024, and for the three and nine months ended September 30, 2024, and 2023.
+Added: The results of operations for the three and nine months ended September 30, 2024, and 2023 are not necessarily indicative of the operating results for the full year.
It is suggested that these Unaudited Condensed Consolidated Financial Statements be read in conjunction with the financial statements and notes thereto for the year ended December 31, 2023.
The Balance Sheet as of December 31, 2023, has been derived from the Company’s audited Financial Statements.
−Removed: Sadot Group, Inc.
−Removed: Notes to the Condensed Consolidated Financial Statements (Unaudited)
Principles of Consolidation
1 unchanged sentence
Any intercompany transactions and balances have been eliminated in consolidation.
+Added: Sadot Group, Inc.
+Added: Notes to the Condensed Consolidated Financial Statements (Unaudited)
Reclassifications
15 unchanged sentences
The Company considers all highly-liquid instruments with an original maturity of three months or less when purchased to be cash equivalents.
−Removed: There were no cash equivalents as of June 30, 2024 or December 31, 2023.
−Removed: Inventory, which are stated at the lower of cost or net realizable value, related to our raw materials, supplies and harvested crops related to our farming operations were $ 2.5 million and $ 2.6 million as of June 30, 2024, and December 31, 2023, respectively.
−Removed: Cost is determined using the first-in, first-out method.
+Added: There were no cash equivalents as of September 30, 2024 or December 31, 2023.
Accounts Receivable
−Removed: Accounts Receivable consists of receivables related to Sadot Agri-Foods of $ 24.9 million and $ 52.9 million net of doubtful accounts of $ 0.3 million and $ 0.2 million as of June 30, 2024, and December 31, 2023, respectively.
+Added: Accounts Receivable consists of receivables of $ 38.3 million and $ 52.9 million, net of doubtful accounts of $ 0.8 million and $ 0.2 million as of September 30, 2024, and December 31, 2023, respectively.
Accounts receivable is stated at historical carrying amounts net of write-offs and allowances for uncollectible accounts.
3 unchanged sentences
The default rate is then applied to the pool to determine the allowance for expected credit losses.
−Removed: Given the short-term nature of the Company's trade accounts receivable, the default rate is only adjusted if significant changes in the credit profile of the portfolio are identified (e.g., poor crop years, credit
−Removed: Sadot Group, Inc.
−Removed: Notes to the Condensed Consolidated Financial Statements (Unaudited)
−Removed: issues at the country level, systematic risk), resulting in historic loss rates that are not representative of forecasted losses.
+Added: Given the short-term nature of the Company's trade accounts receivable, the default rate is only adjusted if significant changes in the credit profile of the portfolio are identified (e.g., poor crop years, credit issues at the country level, systematic risk), resulting in historic loss rates that are not representative of forecasted losses.
Uncollectible accounts are written off when a settlement is reached for an amount that is less than the outstanding historical balance or when the Company has determined that collection of the balance is unlikely.
+Added: Inventory, which are stated at the lower of cost or net realizable value, related to Sadot Agri-foods was $ 1.1 million and $ 2.4 million as of September 30, 2024 and December 31, 2023, respectively and nil and $ 0.2 million related to Sadot food services as of September 30, 2024 and December 31, 2023, respectively.
+Added: Cost is determined using the first-in, first-out method.
Assets held for sale
+Added: Sadot Group, Inc.
+Added: Notes to the Condensed Consolidated Financial Statements (Unaudited)
In the first quarter of 2024, the Company classified its Sadot food services segment as held for sale.
30 unchanged sentences
Significant judgment is required to estimate the fair value of reporting units which includes estimating future cash flows, determining appropriate discount rates and other assumptions.
−Removed: Changes in these estimates and assumptions could materially affect the determination of fair value and/or goodwill
−Removed: Sadot Group, Inc.
−Removed: Notes to the Condensed Consolidated Financial Statements (Unaudited)
+Added: Changes in these estimates and assumptions could materially affect the determination of fair value and/or goodwill impairment.
In the first quarter of 2024, the remaining intangible assets were moved to assets held for sale.
1 unchanged sentence
Impairment of Long-Lived Assets
−Removed: When circumstances, such as adverse market conditions, indicate that the carrying value of a long-lived asset may be impaired, the Company performs an analysis to review the recoverability of the asset’s carrying value, which includes estimating the undiscounted cash flows (excluding interest charges) from the expected future operations of the asset.
+Added: When circumstances, such as adverse market conditions, indicate that the carrying value of a long-lived asset may be impaired, the Company performs an analysis to review the recoverability of the asset’s carrying value, which includes
+Added: Sadot Group, Inc.
+Added: Notes to the Condensed Consolidated Financial Statements (Unaudited)
+Added: estimating the undiscounted cash flows (excluding interest charges) from the expected future operations of the asset.
These estimates consider factors such as expected future operating income, operating trends and prospects, as well as the effects of demand, competition and other factors.
4 unchanged sentences
If the instrument is determined not to be a derivative liability, the Company then evaluates for the existence of a beneficial conversion feature by comparing the market price of the Company’s common stock as of the commitment date to the effective conversion price of the instrument.
−Removed: As of June 30, 2024 and December 31, 2023, the Company deemed the conversion feature related to notes payable was not required to be bifurcated and recorded as a derivative liability.
+Added: As of September 30, 2024 and December 31, 2023, the Company deemed the conversion feature related to notes payable was not required to be bifurcated and recorded as a derivative liability.
Related Parties
15 unchanged sentences
Typically, the Company has lower sales and net income during the non-harvest seasons and higher sales and net income during the harvest season.
+Added: Commodity Sales
+Added: Commodity sale revenue is generated by Sadot Agri-Foods and is recognized when the commodity is delivered as evidenced by the bill of lading, physical delivery or completion of the sale contract and the invoice is prepared and submitted to the customer.
+Added: During the three and nine months ended September 30, 2024, the Company recorded Commodity sales revenues of $ 200.9 million and $ 480.7 million, and $ 180.0 million and $ 547.9 million for the three and
Sadot Group, Inc.
Notes to the Condensed Consolidated Financial Statements (Unaudited)
−Removed: Commodity Sales
−Removed: Commodity sale revenue is generated by Sadot Agri-Foods and is recognized when the commodity is delivered as evidenced by delivery and the invoice is prepared and submitted to the customer.
−Removed: During the three and six months ended June 30, 2024, the Company recorded Commodity sales revenues of $ 173.3 million and $ 279.8 million, and $ 157.6 million and $ 367.9 million for the three and six months ended June 30, 2023, respectively, which is included in Commodity sales on the accompanying Unaudited Condensed Consolidated Statements of Operations and Other Comprehensive Income / (Loss).
+Added: nine months ended September 30, 2023, respectively, which is included in Commodity sales on the accompanying Unaudited Condensed Consolidated Statements of Operations and Other Comprehensive Income / (Loss).
Restaurant Sales
−Removed: Retail store revenue at Sadot Food Service is recognized when payment is tendered at the point of sale, net of sales tax, discounts and other sales-related taxes.
−Removed: During the three and six months ended June 30, 2024, the Company recorded retail store revenues of $ 1.0 million and $ 2.1 million, and $ 2.5 million and $ 4.8 million during the three and six months ended June 30, 2023, respectively, which is included in Restaurant sales on the accompanying Unaudited Condensed Consolidated Statements of Operations and Other Comprehensive Income / (Loss).
+Added: Retail store revenue derived from company owned and operated locations at Sadot Food Service is recognized when payment is tendered at the point of sale, net of sales tax, discounts and other sales-related taxes.
+Added: During the three and nine months ended September 30, 2024, the Company recorded retail store revenues of $ 0.5 million and $ 2.6 million, and $ 1.9 million and $ 6.7 million during the three and nine months ended September 30, 2023, respectively, which is included in Restaurant sales on the accompanying Unaudited Condensed Consolidated Statements of Operations and Other Comprehensive Income / (Loss).
The Company sells gift cards which do not have an expiration date, and it does not deduct dormancy fees from outstanding gift card balances.
1 unchanged sentence
Franchise Royalties and Fees
−Removed: Franchise revenues consists of royalties, initial franchise fees and rebates.
+Added: Franchise revenues derived from Franchisee owned and operated locations consists of royalties, initial franchise fees and rebates.
Royalties are based on a percentage of franchisee net sales revenue.
The Company recognizes the royalties as the underlying sales occur.
−Removed: The Company recorded revenue from royalties of $ 0.2 million and $ 0.5 million during the three and six months ended June 30, 2024 and $ 0.2 million and $ 0.3 million during the three and six months ended June 30, 2023, respectively, which is included in Franchise royalties and fees on the accompanying Unaudited Condensed Consolidated Statements of Operations and Other Comprehensive Income / (Loss).
+Added: The Company recorded revenue from royalties of $ 0.3 million and $ 0.7 million during the three and nine months ended September 30, 2024 and $ 0.2 million and $ 0.5 million during the three and nine months ended September 30, 2023, respectively, which is included in Franchise royalties and fees on the accompanying Unaudited Condensed Consolidated Statements of Operations and Other Comprehensive Income / (Loss).
The Company provides the franchisees with management expertise, training, pre-opening assistance, and restaurant operating assistance in exchange for the multi-unit development fees and initial franchise fees.
4 unchanged sentences
If a franchise location closes or a franchise agreement is terminated for any reason, the unrecognized revenue will be recognized in full at that time.
−Removed: The Company recorded revenue from initial franchise fees of $ 0.5 million and $ 0.5 million, during the three and six months ended June 30, 2024 and $ 23.0 thousand and $ 0.1 million, for the three and six months ended June 30, 2023, respectively, which is included in Franchise royalties and fees on the accompanying Unaudited Condensed Consolidated Statements of Operations and Other Comprehensive Income / (Loss).
+Added: The Company recorded revenue from initial franchise fees of $ 45.0 thousand and $ 0.5 million, during the three and nine months ended September 30, 2024 and $ 23.0 thousand and $ 0.2 million, for the three and nine months ended September 30, 2023, respectively, which is included in Franchise royalties and fees on the accompanying Unaudited Condensed Consolidated Statements of Operations and Other Comprehensive Income / (Loss).
The Company has supply agreements with certain food and beverage vendors.
1 unchanged sentence
Rebates earned on purchases by franchise stores are recorded as revenue during the period in which the related food and beverage purchases are made.
−Removed: The Company recorded revenue from rebates of $ 23.0 thousand and $ 45.9 thousand during the three and six months ended June 30, 2024 and $ 30.0 thousand and $ 0.1 million for the three and six months ended June 30, 2023, respectively, which is included in Franchise royalties and fees on the accompanying Unaudited Condensed Consolidated Statements of Operations and Other Comprehensive Income / (Loss).
+Added: The Company recorded revenue from rebates of $ 14.6 thousand and $ 0.1 million during the three and nine months ended September 30, 2024 and $ 30.0 thousand and $ 0.1 million for the three and nine months ended September 30, 2023, respectively, which is included in Franchise royalties and fees on the accompanying Unaudited Condensed Consolidated Statements of Operations and Other Comprehensive Income / (Loss).
Rebates earned on purchases by Company-owned stores are recorded as a reduction of Food and beverage costs during the period in which the related food and beverage purchases are made.
−Removed: Sadot Group, Inc.
−Removed: Notes to the Condensed Consolidated Financial Statements (Unaudited)
Franchise Advertising Fund Contributions
1 unchanged sentence
The Company’s national advertising services are provided on a system-wide basis and therefore, not considered distinct performance obligations for individual franchisees.
−Removed: In accordance with Topic 606, the Company recognizes these sales-based advertising contributions from franchisees as franchise revenue when the underlying franchisee Company incurs the corresponding advertising expense.
+Added: In accordance with Topic 606, the Company recognizes these sales-based advertising contributions from franchisees as franchise revenue
+Added: Sadot Group, Inc.
+Added: Notes to the Condensed Consolidated Financial Statements (Unaudited)
+Added: when the underlying franchisee Company incurs the corresponding advertising expense.
The Company records the related advertising expenses as incurred under Sales, general and administrative expenses.
1 unchanged sentence
Conversely, when an advertising contribution fund is under-spent at a period-end, the Company will accrue advertising costs up to advertising contributions recorded in revenue.
−Removed: The Company recorded contributions from franchisees of $ 13.0 thousand and $ 28.0 thousand during the three and six months ended June 30, 2024 and $ 20.0 thousand and $ 36.0 thousand for the three and six months ended June 30, 2023, which are included in Franchise advertising fund contributions on the accompanying Unaudited Condensed Consolidated Statements of Operations and Other Comprehensive Income / (Loss).
+Added: The Company recorded contributions from franchisees of $ 12.0 thousand and $ 40.0 thousand during the three and nine months ended September 30, 2024 and $ 16.0 thousand and $ 0.1 million for the three and nine months ended September 30, 2023, which are included in Franchise advertising fund contributions on the accompanying Unaudited Condensed Consolidated Statements of Operations and Other Comprehensive Income / (Loss).
Deferred Revenue
10 unchanged sentences
See Note 15 – Commitments and contingencies for further details.
−Removed: Stock-based expenses for the three and six months ended June 30, 2024 were $ 1.9 million and $ 2.7 million, and for the three and six months ended June 30, 2023 were $ 1.2 million and $ 4.6 million, respectively, and are recorded in the accompanying Unaudited Condensed Consolidated Statements of Operations and Other Comprehensive Income / (Loss).
−Removed: Advertising costs are charged to expense as incurred.
−Removed: Advertising costs of $ 0.1 million and $ 0.1 million for the three and six months ended June 30, 2024 and $ 32.0 thousand and $ 0.1 million for the three and six months ended June 30, 2023, respectively, are included in Sales, general and administrative expenses.
−Removed: For the three and six months ended June 30, 2024, $ 24.9 thousand, $ 49.7 thousand and for the three and six months ended June 30, 2023, $ 0.1 million and $ 0.1 million, respectively, are included in Cost of goods sold in the accompanying Unaudited Condensed Consolidated Statements of Operations and Other Comprehensive Income / (Loss).
+Added: Stock-based expenses for the three and nine months ended September 30, 2024 were $ 1.7 million and $ 4.4 million, and for the three and nine months ended September 30, 2023 were $ 1.1 million and $ 5.7 million, respectively, and are recorded in the accompanying Unaudited Condensed Consolidated Statements of Operations and Other Comprehensive Income / (Loss).
Net Income (Loss) per Share
3 unchanged sentences
by the weighted average number of common shares outstanding during the period plus any potentially dilutive common shares, resulting from the exercise of warrants, option, calculated using the treasury stock method or the conversion of convertible notes payable, calculated using the if-converted method.
−Removed: Sadot Group, Inc.
−Removed: Notes to the Condensed Consolidated Financial Statements (Unaudited)
−Removed: The following securities are excluded from the calculation of weighted average diluted common shares at June 30, 2024 and 2023, respectively, because their inclusion would have been anti-dilutive:
−Removed: Three Months Ended June 30, Six Months Ended June 30,
+Added: The following securities are excluded from the calculation of weighted average diluted common shares at September 30, 2024 and 2023, respectively, because their inclusion would have been anti-dilutive:
+Added: Three Months Ended September 30, Nine Months Ended September 30,
2024 2023 2024 2023
4 unchanged sentences
Total potentially dilutive shares 2,208,205 2,628,142 2,486,959 2,628,142
−Removed: The following table sets forth the computation of basic and dilutive net income / (loss) per share attributable to the Company’s
−Removed: stockholders:
−Removed: Three Months Ended June 30, Six Months Ended June 30,
+Added: Sadot Group, Inc.
+Added: Notes to the Condensed Consolidated Financial Statements (Unaudited)
+Added: The following table sets forth the computation of basic and dilutive net income / (loss) per share attributable to the Company’s stockholders:
+Added: Three Months Ended September 30, Nine Months Ended September 30,
2024 2023 2024 2023
13 unchanged sentences
The following table sets forth the major vendors to purchase commodities for resale, purchase inputs for farming operations and distribute food products to their Company-owned restaurants:
−Removed: Three Months Ended June 30, Six Months Ended June 30,
+Added: Three Months Ended September 30, Nine Months Ended September 30,
2024 2023 2024 2023
5 unchanged sentences
To manage these risks, the Company enters into forward sales contracts and hedges from time to time.
−Removed: The Company evaluates its contracts to determine if such contracts qualify as derivatives
−Removed: Sadot Group, Inc.
−Removed: Notes to the Condensed Consolidated Financial Statements (Unaudited)
−Removed: under FASB Accounting ASC 815, “Derivatives and Hedging” (“ASC 815”).
+Added: The Company evaluates its contracts to determine if such contracts qualify as derivatives under FASB Accounting ASC 815, “Derivatives and Hedging” (“ASC 815”).
Derivative instruments are recorded as either assets or liabilities measured at their fair values.
−Removed: The Company’s existing forward sales contracts for carbon offset units and soybeans do not qualify for hedge accounting treatment.
+Added: The Company’s existing forward sales contracts for soybeans do not qualify for hedge accounting treatment.
Forward sales contracts are derivatives that were purchased and sold at a later date at a fixed or determinable price for a specified period.
3 unchanged sentences
We do not enter into derivative contracts for speculative purposes and do not use leveraged instruments.
−Removed: There were two open hedge positions at June 30, 2024.
+Added: There was one open hedge position at September 30, 2024.
Hedging transaction are initially measured at fair value and then are subsequently remeasured to fair value at the reporting date.
−Removed: Changes in fair value are recognized in Unrealized gain or loss, until the hedge is completed and at that time the gain or loss is recognized in Gain/ (Loss) on the sale of trading securities in the Consolidated Statement of Operations and Other Comprehensive Income / (Loss).
+Added: Changes in fair
+Added: Sadot Group, Inc.
+Added: Notes to the Condensed Consolidated Financial Statements (Unaudited)
+Added: value are recognized in Unrealized loss, net of income tax, until the hedge is completed and at that time the gain or loss is recognized in Cost of goods sold in the Consolidated Statement of Operations and Other Comprehensive Income / (Loss).
Derivative assets and liabilities are classified in the balance sheet as current or non-current based on whether net-cash settlement of the derivative instrument is probable within the next 12 months from the balance sheet date.
13 unchanged sentences
The Company accounts for income taxes under ASC 740, “Income Taxes” (“ASC 740”).
−Removed: Under ASC 740, deferred tax assets and liabilities are determined based on the difference between the financial reporting and tax bases of assets and liabilities and net operating loss and credit carryforwards using enacted tax rates in effect for the year in which the
−Removed: Sadot Group, Inc.
−Removed: Notes to the Condensed Consolidated Financial Statements (Unaudited)
−Removed: differences are expected to impact taxable income.
+Added: Under ASC 740, deferred tax assets and liabilities are determined based on the difference between the financial reporting and tax bases of assets and liabilities and net operating loss and credit carryforwards using enacted tax rates in effect for the year in which the differences are expected to impact taxable income.
Valuation allowances are established when necessary to reduce deferred tax assets to the amounts expected to be realized.
5 unchanged sentences
The Company does not expect any significant changes in its unrecognized tax benefits within years of the reporting date.
+Added: Sadot Group, Inc.
+Added: Notes to the Condensed Consolidated Financial Statements (Unaudited)
The Company’s policy is to classify assessments, if any, for tax related interest as interest expense and penalties as Sales, general and administrative expenses in the Unaudited Condensed Consolidated Statements of Operations and Other Comprehensive Income / (Loss).
Currency Translation Differences
−Removed: Transactions in foreign currencies are translated to the respective functional currencies of Company's at the average foreign exchange rates for income and expenses.
−Removed: Monetary assets and liabilities denominated in foreign currencies at the reporting date are translated to the functional currency at the foreign exchange rate ruling as of the reporting period end date.
+Added: Transactions in foreign currencies are remeasured in the functional currency of the related consolidated company at the average foreign exchange rates for income and expenses.
+Added: Monetary assets and liabilities denominated in foreign currencies at the reporting date are remeasured to the functional currency at the foreign exchange rate ruling as of the reporting period end date.
Non-monetary assets and liabilities that are measured in terms of historical cost in a foreign currency are translated using the exchange rate at the date of the transaction.
−Removed: Non-monetary assets and liabilities denominated in foreign currencies that are stated at fair value are translated to the functional currency at foreign exchange rates ruling at the dates the fair value was determined.
−Removed: Foreign exchange differences arising on translation are recognized in the Unaudited Condensed Consolidated Statement of Operations and Other Comprehensive Income / (Loss).
+Added: Non-monetary assets and liabilities denominated in foreign currencies that are stated at fair value are remeasured to the functional currency at foreign exchange rates ruling at the dates the fair value was determined.
+Added: Foreign exchange differences arising on remeasured are recognized in the Unaudited Condensed Consolidated Statement of Operations and Other Comprehensive Income / (Loss) under Foreign exchange translation adjustment.
The assets and liabilities of foreign operations, including farm operations and fair value adjustments arising on consolidation, are translated to the Company’s reporting currency, United States Dollars, at foreign exchange rates at the reporting date.
8 unchanged sentences
Non-controlling interests represent third-party equity ownership interests in the Company’s farming consolidated entity.
+Added: The Company evaluates its ownership, contractual and other interests in entities to determine if it has any variable interest in a VIE.
+Added: These evaluations are complex, and involve judgment and the use of estimates and assumptions based on available historical information, among other factors.
+Added: The Company considers itself to control an entity if it is the majority owner of or has voting control over such entity.
+Added: The Company also assesses control through means other than voting rights (“variable interest entities” or “VIEs”) and determines which business entity is the primary beneficiary of the VIE.
+Added: Management performs ongoing reassessments of whether changes in the facts and circumstances regarding the Company’s involvement with a VIE will cause the consolidation conclusion to change.
+Added: Changes in consolidation status are applied prospectively.
+Added: The Company has no VIEs at September 30, 2024 and December 31, 2023.
The amount of net income attributable to Non-controlling interests is disclosed in the Unaudited Condensed Consolidated Statements of Income and Other Comprehensive Income / (Loss).
Recent Accounting Pronouncements
−Removed: In October 2021, the FASB issued ASU 2021-08 Business Combinations (“Topic 805”):
−Removed: Accounting for Contract Assets and Contract Liabilities from Contracts with Customers.
−Removed: The ASU requires contract assets and contract liabilities acquired in a business combination to be recognized and measured by the acquirer on the acquisition date in accordance with ASC 606, “Revenue from Contracts with Customers”, as if it had originated the contracts.
−Removed: Under the current business combinations guidance, such assets and liabilities were recognized by the acquirer at fair value on the acquisition date.
−Removed: The ASU is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2022, with early adoption permitted.
−Removed: The adoption of this guidance did not have a material impact on the Company’s Unaudited Condensed Consolidated Financial Statements and related disclosures.
−Removed: Sadot Group, Inc.
−Removed: Notes to the Condensed Consolidated Financial Statements (Unaudited)
In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326):
7 unchanged sentences
Similarly, the embedded conversion feature will no longer be amortized into income as interest expense over the life of the instrument.
−Removed: Instead, entities will account for a convertible debt instrument wholly as debt unless (1) a convertible instrument contains features that require bifurcation as a derivative under ASC Topic 815, Derivatives and Hedging, or (2) a convertible debt instrument was issued at a substantial premium.
+Added: Instead, entities will account for a convertible debt instrument wholly as debt unless (1) a convertible instrument contains features that require bifurcation as a derivative under ASC Topic 815, Derivatives and Hedging, or (2)
+Added: Sadot Group, Inc.
+Added: Notes to the Condensed Consolidated Financial Statements (Unaudited)
+Added: a convertible debt instrument was issued at a substantial premium.
Additionally, ASU 2020-06 requires the application of the if-converted method to calculate the impact of convertible instruments on diluted earnings per share and updates the disclosure requirements in ASC 470-20, making them easier to understand for financial statement preparers and improving the decision-usefulness and relevance of the information for financial statement users.
The Company early adopted the new guidance from January 1, 2023, noting no material impact.
−Removed: In April 2021, the FASB issued ASU 2021-04, “Earnings Per Share (Topic 260), Debt— Modifications and Extinguishments (Subtopic 470-50), Compensation—Stock Compensation (Topic 718), and Derivatives and Hedging— Contracts in Entity’s Own Equity (Subtopic 815-40):
−Removed: Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options” (“ASU 2021-04”) to clarify the accounting by issuers for modifications or exchanges of equity-classified warrants.
−Removed: The new ASU is effective for all entities in fiscal years starting after December 15, 2021.
−Removed: Early adoption is permitted.
−Removed: The Company adopted the new guidance from January 1, 2022, noting no material impact.
In November 2023, the FASB issued ASU 2023-07, Segment Reporting—Improvements to Reportable Segment Disclosures (Topic 280).
4 unchanged sentences
The Company is currently evaluating the impact of this standard on its consolidated financial statements.
+Added: In December 2023, the FASB issued ASU 2023-09, which focuses on income tax disclosures by requiring public business entities, on an annual basis, to disclose specific categories in the rate reconciliation, provide information for reconciling items that meet a quantitative threshold, and certain information about income taxes paid.
+Added: The standard is effective for annual periods beginning after December 15, 2024, with early adoption permitted.
+Added: The amendments should be applied on a prospective basis.
+Added: Retrospective application is permitted.
Subsequent Events
7 unchanged sentences
For more details over the resulting impairment test performed prior to measuring the disposal group at the lower of their carrying amount or fair value less cost to sell, see Note 8 – Goodwill and other intangible assets, net.
−Removed: The following presents the major classes of assets and liabilities for the Sadot food services reporting unit held for sale as of June 30, 2024:
+Added: The following presents the major classes of assets and liabilities for the Sadot food services reporting unit held for sale as of September 30, 2024:
Sadot Group, Inc.
Notes to the Condensed Consolidated Financial Statements (Unaudited)
−Removed: June 30, 2024
+Added: September 30, 2024
Accounts receivable, net of allowance for doubtful accounts of $ 0.8 million
−Removed: Inventory 110
Other current assets 75
15 unchanged sentences
Sadot Food Services had the following pre-tax losses:
−Removed: Three Months Ended June 30, Six Months Ended June 30,
+Added: Three Months Ended September 30, Nine Months Ended September 30,
2024 2023 2024 2023
1 unchanged sentence
Sadot Food Services Net Loss Before Income Tax ( 665 ) ( 2,344 ) ( 1,713 ) ( 3,540 )
+Added: On August 1, 2024 SuperFit foods was sold for $ 0.2 million with a minimal gain on the sale.
Allowance for Credit Losses on Accounts Receivable
−Removed: For the periods ended June 30, 2024 and December 31, 2023, a summary of the activity in the allowance for credit losses on accounts receivable appears below:
−Removed: June 30, 2024 December 31, 2023
+Added: For the periods ended September 30, 2024 and December 31, 2023, a summary of the activity in the allowance for credit losses on accounts receivable appears below:
+Added: September 30, 2024 December 31, 2023
Balance at beginning of period 173 23
6 unchanged sentences
Other Current Assets
−Removed: In the first two quarters of 2024, the Company transferred $ 0.1 million of other current assets to Assets held for sale.
+Added: In the first three quarters of 2024, the Company transferred $ 0.1 million of other current assets to Assets held for sale.
See Note 3 – Assets held for sale for additional information.
−Removed: At June 30, 2024 and December 31, 2023, the Company’s other current assets consists of the following:
−Removed: June 30, 2024 December 31, 2023
+Added: At September 30, 2024 and December 31, 2023, the Company’s other current assets consists of the following:
+Added: September 30, 2024 December 31, 2023
Prepaid expenses 309 766
6 unchanged sentences
Other Current Assets 113,241 56,016
+Added: Deposit on farmland consists of funds paid as a deposit with the intent to acquire farmland in Indonesia by Sadot agri-foods.
Other Non-Current Assets
−Removed: In the first two quarters of 2024, the Company transferred $ 0.1 million of other non-current assets to Assets held for sale.
+Added: In the first three quarters of 2024, the Company transferred $ 0.2 million of other non-current assets to Assets held for sale.
See Note 3 – Assets held for sale for additional information.
−Removed: At June 30, 2024 and December 31, 2023, the Company’s other non-current assets consists of the following:
−Removed: June 30, 2024 December 31, 2023
+Added: At September 30, 2024 and December 31, 2023, the Company’s other non-current assets consists of the following:
+Added: September 30, 2024 December 31, 2023
Security deposit 22 76
5 unchanged sentences
Property and Equipment, Net
−Removed: In the first two quarters of 2024, the Company transferred $ 0.5 million of Property and equipment, net to Assets held for sale.
+Added: In the first three quarters of 2024, the Company transferred $ 6.0 thousand of Property and equipment, net to Assets held for sale.
See Note 3 – Assets held for sale for additional information.
−Removed: As of June 30, 2024 and December 31, 2023, Property and equipment consist of the following:
−Removed: June 30, 2024 December 31, 2023
+Added: As of September 30, 2024 and December 31, 2023, Property and equipment consist of the following:
+Added: September 30, 2024 December 31, 2023
Furniture and equipment 232 1,026
6 unchanged sentences
Property and equipment, net 11,847 12,883
−Removed: Depreciation expense amounted to $ 0.1 million and $ 0.3 million for the three and six months ended June 30, 2024 and $ 0.2 million and $ 0.5 million during the three and six months ended June 30, 2023, respectively.
−Removed: The Company wrote off Property and equipment related to closed locations and future locations that were terminated due to a change of business focus and recorded a loss on disposal of $ 0.1 million and $ 0.2 million during the three and six months ended June 30, 2024 and $ 0.5 million and $ 0.5 million for the three and six months ended June 30, 2023, respectively, in the Unaudited Condensed Consolidated Statement of Operations and Comprehensive Income / (Loss).
+Added: Depreciation expense amounted to $ 49.0 thousand and $ 0.3 million for the three and nine months ended September 30, 2024 and $ 0.2 million and $ 0.7 million during the three and nine months ended September 30, 2023, respectively.
+Added: The Company wrote off Property and equipment related to closed locations and future locations that were terminated due to a change of business focus and recorded a loss on disposal of $ 0.1 million and $ 0.3 million during the three and nine months ended September 30, 2024 and $ 0.3 million and $ 0.3 million for the three and nine months ended September 30, 2023, respectively, in the Unaudited Condensed Consolidated Statement of Operations and Comprehensive Income / (Loss).
Goodwill and Other Intangible Assets, Net
1 unchanged sentence
Intangible assets are amortized over useful lives ranging from 5 to 10 years.
−Removed: In the first two quarters of 2024, the Company moved the remaining intangible assets to assets held for sale and as a result of the reclassification, the Company stopped amortizing these assets.
+Added: In the first three quarters of 2024, the Company moved the remaining intangible assets to assets held for sale and as a result of the reclassification, the Company stopped amortizing these assets.
See Note 3 – Assets held for sale for additional information.
5 unchanged sentences
expense Intangible
+Added: September 30,
2023 Intangible
2 unchanged sentences
expense Transfer to assets held for sale Intangible
+Added: September 30,
$’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000
11 unchanged sentences
4,611 ( 810 ) ( 848 ) 2,953 2,833 — ( 118 ) ( 2,715 ) —
−Removed: Amortization expense related to intangible assets was nil and $ 0.1 million for the three and six months ended June 30, 2024 and $ 0.3 million and $ 0.6 million for the three and six months ended June 30, 2023, respectively.
+Added: Amortization expense related to intangible assets was nil and $ 0.1 million for the three and nine months ended September 30, 2024 and $ 0.3 million and $ 0.8 million for the three and nine months ended September 30, 2023, respectively.
A summary of the goodwill assets is presented below:
3 unchanged sentences
Impairment of goodwill ( 570 ) — ( 258 ) ( 828 )
−Removed: Goodwill, net at June 30, 2023 570 1,798 258 2,626
+Added: Goodwill, net at September 30, 2023 — 1,798 — 1,798
Goodwill, net at December 31 2023 — 1,798 — 1,798
Transfer to assets held for sale — ( 1,798 ) — ( 1,798 )
−Removed: Goodwill, net at June 30, 2024 — — — —
+Added: Goodwill, net at September 30, 2024 — — — —
Sadot Group, Inc.
1 unchanged sentence
Accounts Payables and Accrued Expenses
−Removed: In the first two quarters of 2024, the Company transferred $ 0.4 million of Accounts payables and accrued expenses to Assets held for sale.
+Added: In the first three quarters of 2024, the Company transferred $ 0.2 million of Accounts payables and accrued expenses to Assets held for sale.
See Note 3 – Assets held for sale for additional information.
Accounts payables and accrued expenses consist of the following:
−Removed: June 30, 2024 December 31, 2023
+Added: September 30, 2024 December 31, 2023
Accounts payable 2,954 3,488
19 unchanged sentences
Notes to the Condensed Consolidated Financial Statements (Unaudited)
−Removed: In connection with the SEPA, and subject to the condition set forth therein, Yorkville has agreed to advance to the Company in the form of convertible promissory notes (the “Convertible Notes”) an aggregate principal amount of $ 4.0 million (the “Pre-Paid Advance”).
+Added: In connection with the SEPA, and subject to the condition set forth therein, Yorkville agreed to advance to the Company in the form of convertible promissory notes (the “Convertible Notes”) an aggregate principal amount of $ 4.0 million (the “Pre-Paid Advance”).
The Pre-Paid Advance was disbursed on September 22, 2023 in the principal amount of $ 3.0 million and the balance of $ 1.0 million on October 30, 2023.
7 unchanged sentences
The Exchange Cap Trigger will not apply in the event the Company has obtained the approval from its stockholders in accordance with the rules of Nasdaq Stock Market for the issuance of shares of common stock pursuant to the transactions contemplated in the Convertible Note and the SEPA in excess of 19.99 % of the aggregate number of shares of common stock issued and outstanding as of the effective date of the SEPA (the “Exchange Cap”).
−Removed: No triggering event occurred as of June 30, 2024.
−Removed: As of June 30, 2024, 3.9 million shares of common stock have been converted leaving an aggregate principle balance remaining of $ 2.0 million.
+Added: No triggering event occurred as of September 30, 2024.
+Added: As of September 30, 2024, 607,527 shares of common stock have been converted leaving an aggregate principal balance remaining of $ 0.8 million.
Notes Payable
−Removed: The Company repaid a total amount of $ 2.1 million and $ 6.4 million during the three and six months ended June 30, 2024, and $ 0.1 million and $ 0.1 million, during the three and six months ended June 30, 2023, respectively, of the notes payable.
−Removed: As of June 30, 2024, the Company had an aggregate amount of $ 3.7 million in notes payable.
−Removed: The notes had interest rates ranging between 6.00 % - 25.80 % per annum, due on various dates through January 2025.
−Removed: In the first two quarters of 2024, the Company transferred $ 0.7 million of notes payable to Assets held for sale.
+Added: The Company repaid a total amount of $ 2.0 million and $ 8.3 million during the three and nine months ended September 30, 2024, and $ 0.2 million and $ 0.1 million, during the three and nine months ended September 30, 2023, respectively, of the notes payable.
+Added: As of September 30, 2024, the Company had an aggregate amount of $ 2.8 million in notes payable, net.
+Added: The notes had interest rates ranging between 6.00 % - 25.80 % per annum, due on various dates through March 2025.
+Added: In the first three quarters of 2024, the Company transferred $ 0.6 million of notes payable to Liabilities held for sale.
See Note 3 – Assets held for sale for additional information.
−Removed: The maturities of notes payable as of June 30, 2024, are as follows:
+Added: The maturities of notes payable as of September 30, 2024, are as follows:
Principal Amount
10 unchanged sentences
Notes to the Condensed Consolidated Financial Statements (Unaudited)
−Removed: The total lease cost associated with right of use assets and operating lease liabilities was $ 0.6 million and $ 0.7 million for the three and six months ended June 30, 2024 and $ 0.2 million and $ 0.4 million for the three and six months ended June 30, 2023, respectively, and has been recorded in the Unaudited Condensed Consolidated Statement of Operations and Other Comprehensive Income / (Loss) as Cost of goods sold.
−Removed: In the first two quarters of 2024 all of the Company's leased assets of $ 0.7 million and lease liabilities of $ 0.8 million were moved to Assets held for sale.
+Added: The total lease cost associated with right of use assets and operating lease liabilities was $ 37.0 thousand and $ 0.2 million for the three and nine months ended September 30, 2024 and $ 0.2 million and $ 0.6 million for the three and nine months ended September 30, 2023, respectively, and has been recorded in the Unaudited Condensed Consolidated Statement of Operations and Other Comprehensive Income / (Loss) as Cost of goods sold.
+Added: In the first three quarters of 2024 all of the Company's lease liabilities of $ 0.2 million were moved to Liabilities held for sale.
See Note 3 – Assets held for sale for additional information.
+Added: Right to use asset and operating lease liabilities decreased due to the refranchising, selling and closure of all of our corporate owned locations by September 30, 2024.
The assets and liabilities related to the Company’s leases were as follows:
−Removed: June 30, 2024 December 31, 2023
+Added: September 30, 2024 December 31, 2023
Total lease assets 137 1,284
5 unchanged sentences
Operating leases – non-current 117 1,027
−Removed: The table below presents the future minimum lease payments under the noncancellable operating leases as of June 30, 2024:
+Added: The table below presents the future minimum lease payments under the noncancellable operating leases as of September 30, 2024:
Total Operating Leases Held for Sale Current Operating Leases
9 unchanged sentences
Present value of lease liabilities 321 182 139
+Added: Sadot Group, Inc.
+Added: Notes to the Condensed Consolidated Financial Statements (Unaudited)
The Company’s lease term and discount rates were as follows:
−Removed: As of June 30, 2024
+Added: As of September 30, 2024
Weighted-average remaining lease term (in years)
2 unchanged sentences
Operating leases 15.1 %
−Removed: Sadot Group, Inc.
−Removed: Notes to the Condensed Consolidated Financial Statements (Unaudited)
Deferred Revenue
−Removed: In the first two quarters of 2024, the Company transferred $ 1.0 million of deferred revenue to Liabilities held for sale.
+Added: In the first three quarters of 2024, the Company transferred $ 1.2 million of deferred revenue to Liabilities held for sale.
See Note 3 – Assets held for sale for additional information.
The Company's deferred revenue consists of the following:
−Removed: June 30, 2024 December 31, 2023
+Added: September 30, 2024 December 31, 2023
Deferred revenues, net 2,161 2,784
1 unchanged sentence
Deferred revenues, non-current — 1,555
−Removed: Deferred revenue related to commodity forward sales contracts and prepayments on future trades were $ 7.9 million and $ 1.4 million, as of June 30, 2024 and December 31, 2023, respectively.
−Removed: Deferred revenue related to deferred franchise fees were nil and $ 1.4 million, as of June 30, 2024 and December 31, 2023, respectively.
+Added: Deferred revenue related to commodity forward sales contracts and prepayments on future trades were $ 2.2 million and $ 1.4 million, as of September 30, 2024 and December 31, 2023, respectively.
+Added: Deferred revenue related to deferred franchise fees were nil and $ 1.4 million, as of September 30, 2024 and December 31, 2023, respectively.
Other Current Liabilities
−Removed: In the first two quarters of 2024, the Company transferred $ 0.2 million of other current liabilities to Liabilities held for sale.
+Added: In the first three quarters of 2024, the Company transferred $ 0.2 million of other current liabilities to Liabilities held for sale.
See Note 3 – Assets held for sale for additional information.
Other current liabilities consist of the following:
−Removed: June 30, 2024 December 31, 2023
+Added: September 30, 2024 December 31, 2023
Gift card liability — 13
7 unchanged sentences
Notes to the Condensed Consolidated Financial Statements (Unaudited)
−Removed: The tax effects of temporary differences that give rise to deferred tax assets and liabilities as of June 30, 2024 and December 31, 2023 are presented below:
−Removed: June 30, 2024 December 31, 2023
+Added: The tax effects of temporary differences that give rise to deferred tax assets and liabilities as of September 30, 2024 and December 31, 2023 are presented below:
+Added: September 30, 2024 December 31, 2023
Deferred tax assets:
11 unchanged sentences
Deferred tax liabilities:
+Added: Other liabilities ( 4 ) —
Property and equipment — ( 60 )
6 unchanged sentences
The income tax expense for the periods shown consist of the following:
−Removed: Six Months Ended June 30,
+Added: Nine Months Ended September 30,
State and local:
5 unchanged sentences
A reconciliation of the statutory federal income tax rate to the Company’s effective tax rate for the periods shown, are as follows:
−Removed: June 30, 2024 December 31, 2023
+Added: September 30, 2024 December 31, 2023
Federal income tax benefit at statutory rate 21.0 % 21.0 %
13 unchanged sentences
The net operating loss carryforwards generated prior to 2018, if not utilized, will expire from 2035 to 2037 for federal and state purposes.
−Removed: As of June 30, 2024 and December 31, 2023, the Company has determined that it is more likely than not that the Company will not recognize the future tax benefit of the loss carryforwards and has recognized a valuation allowance of $ 12.7 million and $ 12.8 million, respectively.
+Added: As of September 30, 2024 and December 31, 2023, the Company has determined that it is more likely than not that the Company will not recognize the future tax benefit of the loss carryforwards and has recognized a valuation allowance of $ 12.4 million and $ 12.8 million, respectively.
The valuation allowance decreased by approximately $ 0.4 million.
13 unchanged sentences
However, Sadot Agri-Foods has the right to repurchase any VCUs during the term of this forward contract at the then current market price (based on the prices reported by an independent marketplace).
−Removed: This contract was determined to be a derivative in accordance with ASC 815.
+Added: This contract was determined to be a
Sadot Group, Inc.
Notes to the Condensed Consolidated Financial Statements (Unaudited)
+Added: derivative in accordance with ASC 815.
+Added: On September 20, 2024, the Company sold the right to acquire the 180,000 VCUs for $ 9.3 million.
On November 24, 2023, the Company through Sadot Agri-Foods, entered into a forward sale contract for the sale of 70,000 Metric Tons (“MTs”) of soybeans.
12 unchanged sentences
The Company may only issue authorized, unreserved shares of common stock.
−Removed: The Company will not issue Aggia in excess of 14.4 million shares representing 49.9 % of the number of issued and outstanding shares of common stock as of the Effective Date.
+Added: The Company will not issue Aggia in excess of 1,442,428 shares representing 49.9 % of the number of issued and outstanding shares of common stock as of the Effective Date.
In the event that the shares cap has been reached, then the remaining portion of the net income, if any, not issued as shares shall accrue as debt payable by Sadot Group to Aggia until such debt has reached a maximum of $ 71.5 million.
2 unchanged sentences
On July 14, 2023 (the “Addendum Date”), effective April 1, 2023, the parties entered into Addendum 2 to the Services Agreement (“Addendum 2”) pursuant to which the parties amended the compensation that Aggia is entitled.
−Removed: Pursuant to Addendum 2, on the Addendum Date, the Company issued 8.9 million shares (the “Shares”) of common stock, par value $ 0.0001 per share, of the Company, which such Shares represent 14.4 million Shares that Aggia is entitled to receive pursuant to the Services Agreement less the 5.6 million Shares that have been issued to Aggia pursuant to the Services Agreement as of the Addendum Date.
−Removed: The Company will not issue Aggia in excess of 14.4 million Shares representing 49.9 % of the number of issued and outstanding shares of common stock as of the effective date of the Services Agreement.
+Added: Pursuant to Addendum 2, on the Addendum Date, the Company issued 885,546 shares (the “Shares”) of common stock, par value $ 0.0001 per share, of the Company, which such Shares represent 1,442,428 Shares that Aggia is entitled to receive pursuant to the Services Agreement less the 556,882 Shares that have been issued to Aggia pursuant to the Services Agreement as of the Addendum Date.
+Added: The Company will not issue Aggia in excess of 1,442,428 Shares representing 49.9 % of the number of issued and outstanding shares of common stock as of the effective date of the Services Agreement.
The Shares shall be considered issued and outstanding as of the Addendum Date and Aggia shall hold all rights associated with such Shares.
4 unchanged sentences
Following the Share Repurchase Date, in the event that there is net income for any fiscal quarter, then an amount equal to 40 % of the net income shall accrue as debt payable by Sadot Group to Aggia (the “Debt”), until such Debt has reached a maximum of $ 71.5 million.
−Removed: Additionally, for the three and six months ended June 30, 2024, the Company reimbursed Aggia for all operating costs related to Sadot Agri-Foods' operating expenses including labor of $ 0.9 million and $ 1.8 million, operating expenses of $ 0.1 million and $ 0.2 million and general administrative expenses of nil and $ 5.0 thousand.
−Removed: For the three and six months ended June 30, 2023, operating costs related to Sadot Agri-Foods' operating expenses including labor of $ 0.8 million and $ 1.4 million, operating expenses of $ 0.2 million and $ 0.3 million and general administrative expenses of nil and $ 0.1 million, respectively.
Sadot Group, Inc.
Notes to the Condensed Consolidated Financial Statements (Unaudited)
−Removed: The Company entered into various Pokemoto franchise agreements for a total of 1 and 15 for the three and six months ended June 30, 2024, and 8 and 13 , for the three and six months ended June 30, 2023 respectively, potentially new Pokemoto locations with various franchisees.
−Removed: The Franchisees paid the Company an aggregate of nil and $ 0.2 million for the three and six months ended June 30, 2024 and this has been recorded in liabilities held for sale as of June 30, 2024.
+Added: Additionally, for the three and nine months ended September 30, 2024, the Company reimbursed Aggia for all operating costs related to Sadot Agri-Foods' operating expenses including labor of nil and $ 1.8 million, operating expenses of nil and $ 0.2 million and general administrative expenses of $ 0.8 million and $ 0.9 million.
+Added: For the three and nine months ended September 30, 2023, operating costs related to Sadot Agri-Foods' operating expenses including labor of $ 0.8 million and $ 2.3 million, operating expenses of $ 0.1 million and $ 0.5 million and general administrative expenses of nil and $ 0.1 million, respectively.
+Added: The Company entered into various Pokemoto franchise agreements for a total of 10 and 25 for the three and nine months ended September 30, 2024, and 4 and 15 , for the three and nine months ended September 30, 2023 respectively, potentially new Pokemoto locations with various franchisees.
+Added: The Franchisees paid the Company an aggregate of $ 0.1 million and $ 0.3 million for the three and nine months ended September 30, 2024 and this has been recorded in liabilities held for sale as of September 30, 2024.
See Note 3 – Assets held for sale for additional information.
9 unchanged sentences
ACC has not performed against this agreement.
−Removed: The Company had accrued a sales tax liability for approximately $ 3.2 thousand and $ 28.0 thousand as of June 30, 2024, and December 31, 2023, respectively.
+Added: The Company had accrued a sales tax liability for approximately $ 4.6 thousand and $ 28.0 thousand as of September 30, 2024, and December 31, 2023, respectively.
All current state and local sales taxes from January 1, 2018, for open Company-owned locations have been fully paid and in a timely manner.
1 unchanged sentence
On January 23, 2020, the Company was served a judgment issued by the Judicial Council of California in the amount of $ 0.1 million for a breach of a lease agreement in Chicago, Illinois, in connection with a Company-owned store that was closed in 2018.
−Removed: As of June 30, 2024 and December 31, 2023, the Company has accrued for the liability in accounts payable and accrued expenses.
+Added: As of September 30, 2024 and December 31, 2023, the Company has accrued for the liability in accounts payable and accrued expenses.
In the normal course of business, the Company may be involved in legal proceedings, claims and assessments arising in the ordinary course of business.
1 unchanged sentence
The Company records legal costs associated with loss contingencies as incurred and accrues for all probable and estimable settlements after consulting legal counsel.
+Added: Sadot Group, Inc.
+Added: Notes to the Condensed Consolidated Financial Statements (Unaudited)
Employment Agreements
6 unchanged sentences
Roper received an additional bonus of $ 0.1 million on March 2, 2023 and an additional $ 25.0 thousand which was paid on March 8, 2024, relating to the appointment of certain directors pursuant to the agreement with Aggia.
−Removed: Roper is terminated for any reason, he will be entitled to receive
−Removed: Sadot Group, Inc.
−Removed: Notes to the Condensed Consolidated Financial Statements (Unaudited)
−Removed: accrued salary and vacation pay, accrued bonus payments, all expense reimbursements and shall be entitled to exercise any equity compensation rights through the last day of the term applicable to such stock option.
+Added: Roper is terminated for any reason, he will be entitled to receive accrued salary and vacation pay, accrued bonus payments, all expense reimbursements and shall be entitled to exercise any equity compensation rights through the last day of the term applicable to such stock option.
Roper is terminated by the Company for any reason other than cause or resigns for a good reason, Mr.
Roper will be entitled to a severance payment equal to 36 months of salary, which will be reduced to 18 months following the second anniversary of the Roper Agreement, and all equity compensation shall be fully accelerated.
−Removed: In the event the Shareholder Matters are not approved by the shareholders, the Roper Agreement will automatically terminate and the prior employment agreement will again be in full effect.
On March 21, 2023, the Company entered into an Executive Employment Agreement with Jennifer Black (the “Black Agreement”), which replaced her prior employment agreement.
7 unchanged sentences
Black is terminated by the Company for any reason other than cause or resigns for a good reason, Ms.
−Removed: Black will be entitled to a severance payment equal to 36 months of salary, which will be reduced to six months following the second anniversary of the Black Agreement, and all equity compensation shall be fully accelerated.
−Removed: In the event the Shareholder Matters are not approved by the shareholders, the Black Agreement will automatically terminate and the prior employment agreement will again be in full effect.
+Added: Black will be entitled to a severance payment equal to 36 months of salary, which will be reduced to six months on November 16, 2024 and all equity compensation shall be fully accelerated.
On November 16, 2022, the Company entered into an Executive Employment Agreement with Kenn Miller (the “Miller Agreement”), which replaced his prior employment agreement.
4 unchanged sentences
Miller will be eligible for a discretionary performance bonus up to 75 % of his annual salary.
−Removed: Miller will be entitled to an additional bonus of $ 25.0 thousand which was paid on March 8, 2024, relating to the appointment of certain directors pursuant to the agreement with Aggia.
+Added: Miller received an additional bonus of $ 25.0 thousand which was paid on March 8, 2024, relating to the appointment of certain directors pursuant to the agreement with Aggia.
Miller is terminated for any reason, he will be entitled to receive accrued salary and vacation pay, accrued bonus payments, all expense reimbursements and shall be entitled to exercise any equity compensation rights through the last day of the term applicable to such stock option.
1 unchanged sentence
Miller will be entitled to a severance payment equal to 36 months of salary, which will be reduced to 12 months following the second anniversary of the Miller Agreement, and all equity compensation shall be fully accelerated.
−Removed: In the event the Shareholder Matters are not approved by the shareholders, the Miller Agreement will automatically terminate and the prior employment agreement will again be in full effect.
On November 16, 2022, the Company entered into an Executive Employment Agreement with Kevin Mohan (the “Mohan Agreement”), which replaced his prior employment agreement.
8 unchanged sentences
Mohan will be entitled to a severance payment equal to 36 months of salary, which will be reduced to six months following the second anniversary of the Mohan Agreement, and all equity compensation shall be fully accelerated..
−Removed: In the event the Shareholder Matters are not approved by the shareholders, the Mohan Agreement will automatically terminate and the prior employment agreement will again be in full effect.
On November 16, 2022, the Company entered into an Executive Employment Agreement with Aimee Infante (the “Infante Agreement”), which replaced her prior employment agreement.
Pursuant to the Infante Agreement, Ms.
−Removed: Infante will continue to be employed as Chief Marketing Officer of the Company on an at-will-basis.
−Removed: During the term of the Infante Agreement, Ms.
−Removed: Infante is entitled to a base salary at the annualized rate of $ 0.2 million.
−Removed: Infante will be eligible for a
Sadot Group, Inc.
Notes to the Condensed Consolidated Financial Statements (Unaudited)
−Removed: discretionary performance bonus up to 25 % of her annual salary.
−Removed: Infante will be entitled to an additional bonus of $ 25.0 thousand which was paid on March 8, 2024, relating to the appointment of certain directors pursuant to the agreement with Aggia.
+Added: continue to be employed as Chief Marketing Officer of the Company on an at-will-basis.
+Added: During the term of the Infante Agreement, Ms.
+Added: Infante is entitled to a base salary at the annualized rate of $ 0.2 million.
+Added: Infante will be eligible for a discretionary performance bonus up to 25 % of her annual salary.
+Added: Infante received an additional bonus of $ 25.0 thousand which was paid on March 8, 2024, relating to the appointment of certain directors pursuant to the agreement with Aggia.
Infante is terminated for any reason, she will be entitled to receive accrued salary and vacation pay, accrued bonus payments, all expense reimbursements and shall be entitled to exercise any equity compensation rights through the last day of the term applicable to such stock option.
1 unchanged sentence
Infante will be entitled to a severance payment equal to 36 months of salary, which will be reduced to six months following the second anniversary of the Infante Agreement, and all equity compensation shall be fully accelerated.
−Removed: In the event the Shareholder Matters are not approved by the shareholders, the Infante Agreement will automatically terminate, and the prior employment agreement will again be in full effect.
NASDAQ Notice
−Removed: On November 7, 2023, the Company received notice from The Nasdaq Stock Market (“Nasdaq”) that the closing bid price for the Company’s common stock had been below $1.00 per share for the previous 30 consecutive business days, and that the Company is therefore not in compliance with the minimum bid price requirement for continued inclusion on The Nasdaq Capital Market under Nasdaq Listing Rule 5550(a)(2) (the “Rule”).
−Removed: Nasdaq’s notice has no immediate effect on the listing or trading of the Company’s common stock on The Nasdaq Capital Market.
−Removed: The notice indicates that the Company will have 180 calendar days, until May 6, 2024, to regain compliance with this requirement.
+Added: On November 7, 2023, the Company received notice from The Nasdaq Stock Market (“Nasdaq”) that the closing bid price for the Company’s common stock had been below $1.00 per share for the previous 30 consecutive business days, and that the Company was therefore not in compliance with the minimum bid price requirement for continued inclusion on The Nasdaq Capital Market under Nasdaq Listing Rule 5550(a)(2) (the “Rule”).
+Added: The notice indicated that the Company will have 180 calendar days, until May 6, 2024, to regain compliance with this requirement.
On April 29, 2024, the Company submitted a request to Nasdaq requesting an additional 180 days to regain compliance.
On May 7, 2024, the Company received notice from Nasdaq that the request for an additional 180 days to regain compliance was approved.
−Removed: The Company can regain compliance with the $1.00 minimum bid listing requirement if the closing bid price of its common stock is at least $1.00 per share for a minimum of ten (10) consecutive business days during the 180-day compliance period.
−Removed: To qualify, the Company will be required to meet the continued listing requirement for market value of our publicly held shares and all other Nasdaq initial listing standards, except the bid price requirement, and will need to provide written notice to Nasdaq of its intention to cure the deficiency during the second compliance period.
−Removed: If the Company is not eligible or it appears to Nasdaq that the Company will not be able to cure the deficiency during the second compliance period, Nasdaq will provide written notice to the Company that the Company’s common stock will be subject to delisting.
−Removed: In the event of such notification, the Company may appeal Nasdaq’s determination to delist its securities, but there can be no assurance that Nasdaq would grant the Company’s request for continued listing.
−Removed: The Company intends to actively monitor the minimum bid price of its common stock and may, as appropriate, consider available options to regain compliance with the Rule.
−Removed: There can be no assurance that the Company will be able to regain compliance with the Rule or will otherwise be in compliance with other Nasdaq listing criteria.
+Added: The Company was eligible to regain compliance with the $1.00 minimum bid listing requirement if the closing bid price of its common stock is at least $1.00 per share for a minimum of ten (10) consecutive business days during the 180-day compliance period.
+Added: To qualify, the Company was required to meet the continued listing requirement for market value of the Company's publically held shares and all other Nasdaq initial listing standards, except the bid price requirement, and was required to provide written notice to Nasdaq of its intention to cure the deficiency during the second compliance period.
+Added: On October 9, 2024, the Company filed a Certificate of Change Pursuant to NRS 78.209 with the Nevada Secretary of State to effect the Reverse Stock Split, which became effective 12:01 am eastern on October 18, 2024.
+Added: As a result of the Reverse Stock Split, every 10 shares of the Company’s common stock issued and outstanding on the effective date were consolidated into one issued and outstanding share.
+Added: All stockholders who would be entitled to receive fractional shares as a result of the Reverse Stock Split received one whole share for their fractional share interest.
+Added: There was no change in the par value of our common stock.
+Added: The Company effectuated a Reverse Stock Split to raise the per share bid price of the Company’s Common Stock above $1.00 per share with the goal of bringing the Company back into compliance with Nasdaq Listing Rule 5550(a)(2).
+Added: The Company received notice from Nasdaq on November 1, 2024, indicating that the Company regained compliance with the minimum bid price requirement under the Rule.
+Added: The Company’s common stock began trading on a split-adjusted basis on Nasdaq at the commencement of trading on October 18, 2024 under the Company’s existing symbol “SDOT.” The Company’s common stock has been assigned a new CUSIP number of 627333305 in connection with the Reverse Stock Split.
Sadot Group, Inc.
2 unchanged sentences
See Note 1 – Business organization and nature of operations for descriptions of our operating segments.
−Removed: The following table sets forth the results of operations for the relevant segments for the three and six months ended June 30, 2024:
−Removed: For the Three Months Ended June 30, 2024
+Added: The following table sets forth the results of operations for the relevant segments for the three and nine months ended September 30, 2024:
+Added: For the Three Months Ended September 30, 2024
Sadot food service Sadot agri-foods Corporate adj.
5 unchanged sentences
Franchise advertising fund contributions 12 — — 12
+Added: Other revenues 16 — — 16
Cost of goods sold ( 563 ) ( 198,708 ) — ( 199,271 )
17 unchanged sentences
Notes to the Condensed Consolidated Financial Statements (Unaudited)
−Removed: For the Six Months Ended June 30, 2024
+Added: For the Nine Months Ended September 30, 2024
Sadot food service Sadot agri-foods Corporate adj.
5 unchanged sentences
Franchise advertising fund contributions 40 — — 40
+Added: Other revenues 16 — — 16
Cost of goods sold ( 3,113 ) ( 476,961 ) — ( 480,074 )
17 unchanged sentences
Notes to the Condensed Consolidated Financial Statements (Unaudited)
−Removed: The following table sets forth the results of operations for the relevant segments for the three and six months ended June 30, 2023:
−Removed: For the Three Months Ended June 30, 2023
+Added: The following table sets forth the results of operations for the relevant segments for the three and nine months ended September 30, 2023:
+Added: For the Three Months Ended September 30, 2023
Sadot food service Sadot agri-foods Corporate adj.
8 unchanged sentences
Gross profit 31 2,874 — 2,905
+Added: Impairment of goodwill ( 828 ) — — ( 828 )
+Added: Impairment of intangible assets ( 810 ) — — ( 810 )
Depreciation and amortization expenses ( 382 ) ( 61 ) — ( 443 )
Franchise advertising fund expenses ( 16 ) — — ( 16 )
+Added: Pre-opening expenses — ( 335 ) — ( 335 )
Post-closing expenses ( 60 ) — — ( 60 )
5 unchanged sentences
Change in fair value of stock-based compensation — — 297 297
+Added: Warrant modification expense — — ( 958 ) ( 958 )
+Added: Loss on fair value remeasurement — ( 349 ) — ( 349 )
Income / (Loss) Before Income Tax ( 2,344 ) 1,571 ( 4,509 ) ( 5,282 )
4 unchanged sentences
Notes to the Condensed Consolidated Financial Statements (Unaudited)
−Removed: For the Six Months Ended June 30, 2023
+Added: For the Nine Months Ended September 30, 2023
Sadot food service Sadot agri-foods Corporate adj.
8 unchanged sentences
Gross profit 262 10,392 — 10,654
+Added: Impairment of goodwill ( 828 ) — — ( 828 )
+Added: Impairment of intangible assets ( 810 ) — — ( 810 )
Depreciation and amortization expenses ( 1,456 ) ( 61 ) — ( 1,517 )
8 unchanged sentences
Change in fair value of stock-based compensation — — 1,161 1,161
−Removed: (Loss) / Income Before Income Tax ( 1,197 ) 6,932 ( 6,605 ) ( 870 )
+Added: Warrant modification expense — — ( 958 ) ( 958 )
+Added: Loss on fair value remeasurement — ( 349 ) — ( 349 )
+Added: Income / (Loss) Before Income Tax ( 3,540 ) 8,480 ( 11,093 ) ( 6,153 )
Income tax expense ( 2 ) — ( 16 ) ( 18 )
1 unchanged sentence
Total assets 8,798 80,166 1,704 90,668
−Removed: During the first two quarters of 2024, assets related to our Sadot food services segment met the criteria for classification as Assets Held for Sale.
+Added: During the first three quarters of 2024, assets related to our Sadot food services segment met the criteria for classification as Assets Held for Sale.
For additional information, see Note 2 – Significant accounting policies and Note 3 – Assets held for sale.
5 unchanged sentences
Fair Value Measurement
−Removed: The following tables presents information about the Company's assets and liabilities that are measure at fair value on a recurring basis at June 30, 2024 and December 31, 2023 and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value.
+Added: The following tables presents information about the Company's assets and liabilities that are measure at fair value on a recurring basis at September 30, 2024 and December 31, 2023 and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value.
Sadot Group, Inc.
Notes to the Condensed Consolidated Financial Statements (Unaudited)
−Removed: June 30, 2024
+Added: September 30, 2024
Level 1 Level 2 Level 3 Total
16 unchanged sentences
— 92,094 — 92,094
−Removed: There were no transfers between fair value levels during the three and six months ended June 30, 2024.
+Added: There were no transfers between fair value levels during the three and nine months ended September 30, 2024.
See Note 19 – Equity for details related to accrued compensation liability being fair valued using Level 1 inputs.
1 unchanged sentence
Derivative Liability
−Removed: The Derivative liability is primarily related to open hedging positions as of June 30, 2024.
+Added: The Derivative liability is primarily related to open hedging positions as of September 30, 2024.
The fair value of the Derivative liability is based on quoted prices for similar assets and liabilities in active market or inputs that are observable which represent Level 2 measurements within the fair value hierarchy and is based on observable prices for similar assets sourced by an independent marketplace.
9 unchanged sentences
Changes in the fair value on the portion of the derivative included in the assessment of hedge effectiveness of cash-flow hedges are recorded in Other Comprehensive Income / (Loss), until earnings are affected by the variability of cash flows.
−Removed: The change in fair value on undesignated instruments is recorded through earnings in Unrealized gain / (loss) and gain / (loss) on sale of trading securities.
−Removed: There were two current contracts designated as a hedge at June 30, 2024.
+Added: The change in fair value on undesignated instruments is recorded through earnings in Cost of goods sold.
+Added: There was one current contract designated as a hedge at September 30, 2024.
We net settle amounts due, if any, under the contract with our counterparty.
−Removed: Additionally, the Company is exposed to market risks primarily related to the volatility in the price of carbon credits.
−Removed: To manage these risks, the Company enters into forward sales contracts to sell carbon offset units from time to time.
−Removed: The Company evaluates its contracts to determine if such contracts qualify as derivatives under ASC 815.
−Removed: As the Company’s existing carbon offset contracts do not qualify for hedge accounting treatment, any changes in fair value are recorded as Gain (loss) on fair value remeasurement within Gain/loss.
−Removed: The Forward sales derivative asset and Derivative liability primarily relate to the forward sale contracts and open hedge positions.
The fair value of the Forward sales derivative asset and Derivative liability is based on quoted prices for similar assets and liabilities in active market or inputs that are observable, which represent Level 2 measurements within the fair value hierarchy and is based on observable prices for similar assets sourced by an independent marketplace.
−Removed: The Forward sales derivative asset refers to the forward sales contracts executed in September, November and December 2023.
Refer to Note 15 – Commitments and contingencies, for a more detailed discussion of the transactions.
−Removed: During the three and six months ended June 30, 2024, the fair value increased by $ 3.3 million and $ 6.5 million, respectively.
+Added: During the three and nine months ended September 30, 2024, the fair value increased by $ 5.5 million and $ 12.0 million, respectively.
See Note 2 – Significant accounting policies, Note 15 – Commitments and contingencies and Note 17 – Fair value measurement for further details regarding the Derivative liability.
1 unchanged sentence
The Company’s board of directors and shareholders approved and adopted on October 7, 2021 the 2021 Equity Incentive Plan (“2021 Plan”), effective on September 16, 2020 under which stock options and restricted stock may be granted to officers, directors, employees and consultants in the form of non-qualified stock options, incentive stock-options, stock appreciation rights, restricted stock awards, restricted stock units, stock bonus awards, performance compensation awards (including cash bonus awards) or any combination of the foregoing.
−Removed: Under the 2021 Plan, the Company reserved 1.5 million shares of common stock for issuance.
−Removed: As of June 30, 2024, 0.7 million shares have been issued and 0.7 million options to purchase shares have been awarded under the 2021 Plan.
+Added: Under the 2021 Plan, the Company reserved 150,000 shares of common stock for issuance.
+Added: As of September 30, 2024, 65,643 shares have been issued and 74,357 options to purchase shares have been awarded under the 2021 Plan.
The Company’s board of directors and shareholders approved and adopted on February 28, 2023 the 2023 Equity Incentive Plan (“2023 Plan”) under which stock options and restricted stock may be granted to officers, directors, employees and consultants in the form of non-qualified stock options, incentive stock-options, stock appreciation rights, restricted stock awards, restricted stock Units, stock bonus awards, performance compensation awards (including cash bonus awards) or any combination of the foregoing.
−Removed: Under the 2023 Plan, the Company reserved 2.5 million shares of common stock for issuance.
−Removed: As of June 30, 2024, 2.4 million shares have been issued and 0.1 million option to purchase shares have been awarded under the 2023 Plan.
+Added: Under the 2023 Plan, the Company reserved 250,000 shares of common stock for issuance.
+Added: As of September 30, 2024, 242,404 shares have been issued and 6,893 option to purchase shares have been awarded under the 2023 Plan.
The Company’s board of directors and shareholders approved and adopted on December 20, 2023 the 2024 Equity Incentive Plan (“2024 Plan”) under which stock options and restricted stock may be granted to officers, directors, employees and consultants in the form of non-qualified stock options, incentive stock-options, stock appreciation rights, restricted stock awards, restricted stock Units, stock bonus awards, performance compensation awards (including cash bonus awards) or any combination of the foregoing.
−Removed: Under the 2024 Plan, the Company reserved 7.5 million shares of common stock for issuance.
−Removed: As of June 30, 2024, 2.3 million shares have been issued under the 2024 Plan.
+Added: Under the 2024 Plan, the Company reserved 750,000 shares of common stock for issuance.
+Added: As of September 30, 2024, 279,914 shares have been issued under the 2024 Plan.
+Added: Common Stock Issuances
+Added: On January 5, 2023, the Company authorized the issuance of an aggregate of 3,131 shares of common stock to the members of the board of directors as compensation earned during the fourth quarter of 2022.
+Added: On March 27, 2023, the Company authorized the issuance of 284,881 shares of common stock to Aggia as consulting fees earned during the fourth quarter of 2022.
Sadot Group, Inc.
Notes to the Condensed Consolidated Financial Statements (Unaudited)
−Removed: Common Stock Issuances
−Removed: On January 5, 2023, the Company authorized the issuance of an aggregate of 31.3 thousand shares of common stock to the members of the board of directors as compensation earned during the fourth quarter of 2022.
−Removed: On March 27, 2023, the Company authorized the issuance of 2.8 million shares of common stock to Aggia as consulting fees earned during the fourth quarter of 2022.
−Removed: On April 5, 2023 the Company authorized the issuance of 29.7 thousand shares of common stock to the members of the board of directors as compensation earned during the first quarter of 2023.
−Removed: On May 10, 2023 the Company authorized the issuance of 0.1 million shares of common stock to a consultant for services rendered.
−Removed: On May 25, 2023, the Company authorized the issuance of 2.7 million shares of common stock to Aggia as consulting fees earned during the first quarter of 2023.
−Removed: On January 4, 2024 the Company authorized the issuance of 0.1 million shares of common stock to the members of the board of directors as compensation earned during the fourth quarter of 2023.
−Removed: On January 8, 2024, the Company authorized the issuance of 0.3 million shares of common stock in connection with the conversion of notes payable.
−Removed: On January 11, 2024, the Company authorized the issuance of 0.3 million shares of common stock in connection with the conversion of notes payable.
−Removed: On January 22, 2024, the Company authorized the issuance of 0.3 million shares of common stock in connection with the conversion of notes payable.
−Removed: On January 29, 2024, the Company authorized the issuance of 0.3 million shares of common stock in connection with the conversion of notes payable.
−Removed: On February 16, 2024 the Company authorized the issuance of 3.0 thousand shares of common stock to a consultant for services rendered.
−Removed: On February 16, 2024, the Company authorized the issuance of 0.3 million shares of common stock in connection with the conversion of notes payable.
−Removed: On March 15, 2024, the Company authorized the issuance of 0.6 million shares of common stock in connection with the conversion of notes payable.
−Removed: On March 20, 2024, the Company authorized the issuance of 0.8 million shares of common stock in connection with the conversion of notes payable.
−Removed: On March 28, 2024 the Company authorized the issuance of 0.1 million shares of common stock to a consultant for services rendered.
−Removed: On March 31, 2024, the Company vested 0.5 million shares of common stock to Aggia as consulting fees earned during the fourth quarter of 2023.
−Removed: On June 30, 2024, the Company vested 1.4 million shares of common stock to Aggia as consulting fees earned during the first quarter of 2024.
+Added: On April 5, 2023 the Company authorized the issuance of 2,974 shares of common stock to the members of the board of directors as compensation earned during the first quarter of 2023.
+Added: On May 10, 2023 the Company authorized the issuance of 13,965 shares of common stock to a consultant for services rendered.
+Added: On May 25, 2023, the Company authorized the issuance of 272,002 shares of common stock to Aggia as consulting fees earned during the first quarter of 2023.
+Added: On June 30, 2023, the Company vested 85,472 shares of common stock to Aggia as consulting fees earned during the second quarter of 2023.
+Added: On July 11, 2023, the Company authorized the issuance of an aggregate of 3,289 shares of common stock to the members of the board of directors as compensation earned during the second quarter of 2023.
+Added: On July 14, 2023, The Company issued 885,545 Restricted Share Awards, with an effective issuance date of April 1, 2023.
+Added: On August 15, 2023, the Company authorized the issuance of 5,000 shares of common stock to a consultant for services rendered.
+Added: On September 25, 2023, the Company authorized the issuance of 22,727 shares of common stock in fees to a consultant for services rendered related to the SEPA.
+Added: On September 30, 2023, the Company vested 53,831 shares of common stock to Aggia as consulting fees earned during the third quarter of 2023.
+Added: On January 4, 2024 the Company authorized the issuance of 10,564 shares of common stock to the members of the board of directors as compensation earned during the fourth quarter of 2023.
+Added: On January 8, 2024, the Company authorized the issuance of 27,694 shares of common stock in connection with the conversion of notes payable.
+Added: On January 11, 2024, the Company authorized the issuance of 27,891 shares of common stock in connection with the conversion of notes payable.
+Added: On January 22, 2024, the Company authorized the issuance of 30,577 shares of common stock in connection with the conversion of notes payable.
+Added: On January 29, 2024, the Company authorized the issuance of 30,443 shares of common stock in connection with the conversion of notes payable.
+Added: On February 16, 2024 the Company authorized the issuance of 300 shares of common stock to a consultant for services rendered.
+Added: On February 16, 2024, the Company authorized the issuance of 30,572 shares of common stock in connection with the conversion of notes payable.
+Added: On March 15, 2024, the Company authorized the issuance of 60,885 shares of common stock in connection with the conversion of notes payable.
+Added: On March 20, 2024, the Company authorized the issuance of 76,077 shares of common stock in connection with the conversion of notes payable.
+Added: On March 28, 2024 the Company authorized the issuance of 7,950 shares of common stock to a consultant for services rendered.
+Added: On March 31, 2024, the Company vested 50,094 shares of common stock to Aggia as consulting fees earned during the fourth quarter of 2023.
+Added: Sadot Group, Inc.
+Added: Notes to the Condensed Consolidated Financial Statements (Unaudited)
+Added: On June 30, 2024, the Company vested 139,899 shares of common stock to Aggia as consulting fees earned during the first quarter of 2024.
+Added: On August 14, 2024, the Company authorized the issuance of 54,981 shares of common stock in connection with the conversion of notes payable.
+Added: On August 19, 2024, the Company authorized the issuance of 104,249 shares of common stock in connection with the conversion of notes payable.
+Added: On August 26, 2024 the Company authorized the issuance of 47,500 shares of common stock to a consultant for services rendered.
+Added: On September 27, 2024, the Company authorized the issuance of 62,549 shares of common stock in connection with the conversion of notes payable.
+Added: On September 30, 2024, the Company vested 121,149 shares of common stock to Aggia as consulting fees earned during the second quarter of 2024.
+Added: Preferred Stock
+Added: Our authorized preferred stock consists of 10,000,000 shares of preferred stock, $ 0.0001 par value per share.
+Added: As of September 30, 2024 there are no shares of preferred stock currently issued and outstanding.
Restricted Share Awards
1 unchanged sentence
These RSA are considered issued as of the effective date on April 1, 2023.
−Removed: Pursuant to the Services Agreement these RSA's vest on a progressive schedule, at a rate equal to the Net Income of Sadot Agri-Foods, calculated quarterly divided by $ 3.125 , which
+Added: Pursuant to the Services Agreement these RSA's vest on a progressive schedule, at a rate equal to the Net Income of Sadot Agri-Foods, calculated quarterly divided by $ 31.250 , which for accounting purposes shall equal 40 % of the net income of Sadot Agri-Foods, calculated quarterly divided by $ 12.50 .
+Added: Shares shall be considered issued and outstanding as of the effective date and Aggia shall hold rights associated with such Shares;
+Added: provided, however, Shares not earned or purchased may not be transferred, offered, pledged, sold, subject to a contract to sell, granted any options for the sale of or otherwise disposed of, directly or indirectly.
+Added: The total RSA's vested for Aggia for the three and nine months ended September 30, 2024 were 121,149 and 311,142 , respectively.
Sadot Group, Inc.
Notes to the Condensed Consolidated Financial Statements (Unaudited)
−Removed: for accounting purposes shall equal 40 % of the net income of Sadot Agri-Foods, calculated quarterly divided by $ 1.25 .
−Removed: Shares shall be considered issued and outstanding as of the Addendum Date and Aggia shall hold rights associated with such Shares;
−Removed: provided, however, Shares not earned or purchased may not be transferred, offered, pledged, sold, subject to a contract to sell, granted any options for the sale of or otherwise disposed of, directly or indirectly.
−Removed: The total RSA's vested for Aggia for the three and six months ended June 30, 2024 were 1.4 million and 1.9 million, respectively.
−Removed: At June 30, 2024, there were 8.8 million restricted share awards outstanding.
+Added: At September 30, 2024, there were 722,068 restricted share awards outstanding awarded to employees, consultants and the board of directors.
A summary of the activity related to the restricted share awards, is presented below:
Total RSA's Weighted-average
−Removed: Outstanding, December 31, 2022 — —
+Added: Unvested at, December 31, 2022 — —
Granted 885,546 12.50
1 unchanged sentence
Vested ( 139,272 ) 12.50
−Removed: Outstanding at June 30, 2023 8,000,738 1.25
−Removed: Outstanding at December 31, 2023 9,098,767 1.09
+Added: Unvested at September 30, 2023 746,274 12.50
+Added: Unvested at December 31, 2023 909,877 10.85
Granted 213,600 2.95
1 unchanged sentence
Vested ( 401,409 ) 10.51
−Removed: Outstanding at June 30, 2024 8,763,791 0.90
+Added: Unvested at September 30, 2024 722,068 8.70
Change in fair value of stock-based compensation on the Unaudited Condensed Consolidated Statement of Operations and Other Comprehensive Income / (Loss) is made up of the difference between the agreed upon issuance price, per the servicing agreement with Aggia and the market price on the day of issuance.
−Removed: Change in fair value of stock-based compensation was $ 1.2 million and $ 1.7 million for the three and six months ended June 30, 2024, and $ 0.3 million and $ 0.9 million, for the three and six months ended June 30, 2023, respectively.
+Added: Change in fair value of stock-based compensation was $ 1.0 million and $ 2.7 million for the three and nine months ended September 30, 2024, and $ 0.3 million and $ 1.2 million, for the three and nine months ended September 30, 2023, respectively.
See Note 15 – Commitments and contingencies for further details on Restricted Share Awards.
5 unchanged sentences
Treasury zero-coupon bonds with a remaining term consistent with the expected term of the instrument being valued.
−Removed: On February 27, 2023, the Company issued options to purchase an aggregate of 0.5 million shares of the Company's common stock to officers and directors.
+Added: On February 27, 2023, the Company issued options to purchase an aggregate of 53,107 shares of the Company's common stock to officers and directors.
The options had an exercise price of $ 15.05 per share and vest ratably over 20 quarters with the first vesting occurring March 31, 2023.
−Removed: On March 15, 2023, the Company issued options to purchase 0.1 million shares of the Company's common stock.
+Added: On March 15, 2023, the Company issued options to purchase 6,893 shares of the Company's common stock.
The options had an exercise price of $ 15.05 per share and vest ratably over 20 quarters with the first vesting occurring March 31, 2023.
11 unchanged sentences
Forfeited — — N/A —
−Removed: Outstanding, June 30, 2023 1.51 1,012,500 4.75 244
−Removed: Exercisable and vested, June 30, 2023 2.64 235,643 2.92 59
+Added: Outstanding, September 30, 2023 15.15 101,250 4.49 90
+Added: Exercisable and vested, September 30, 2023 23.94 28,127 3.04 26
Outstanding, December 31, 2023 10.94 82,750 4.26 —
2 unchanged sentences
Forfeited 15.05 ( 1,500 ) N/A —
−Removed: Outstanding, June 30, 2024 1.09 812,500 3.67 —
−Removed: Exercisable and vested, June 30, 2024 0.98 288,124 3.55 —
+Added: Outstanding, September 30, 2024 10.90 81,250 3.42 3,125
+Added: Exercisable and vested, September 30, 2024 9.96 32,875 3.31 1,538
The Company has estimated the fair value of the options using the Black-Scholes model using the following assumptions:
−Removed: Six Months Ended June 30, 2024
+Added: Nine Months Ended September 30, 2024
Risk free interest rate 1.53 - 4.33 %
4 unchanged sentences
On July 27, 2023 (the “Closing Date”), the Company entered into a Warrant Exercise Agreement (the “Exercise Agreement”) with Altium Growth Fund Ltd.
−Removed: (the “Exercising Holder”), the holder of outstanding warrants to purchase 2.2 million shares of common stock of the Company issued in November 2021 (collectively, the “Original Warrants”), whereby the Exercising Holder exercised the Original Warrants in consideration of 2.2 million shares of common stock (the “Shares”).
+Added: (the “Exercising Holder”), the holder of outstanding warrants to purchase 215,331 shares of common stock of the Company issued in November 2021 (collectively, the “Original Warrants”), whereby the Exercising Holder exercised the Original Warrants in consideration of 215,331 shares of common stock (the “Shares”).
The Company received aggregate gross proceeds before expenses of approximately $ 2.2 million.
In order to induce the Exercising Holder to exercise the Original Warrants, the Company reduced the exercise price on the Original Warrants from $ 13.85 to $ 10.00 per share.
−Removed: In connection with the exercise of the Original Warrants, we issued an additional warrant to Altium that is exercisable to acquire 2.2 million shares of common stock (the “Additional Warrant”) exercisable at a per share price of $ 2.40 .
+Added: In connection with the exercise of the Original Warrants, we issued an additional warrant to Altium that is exercisable to acquire 215,331 shares of common stock (the “Additional Warrant”) exercisable at a per share price of $ 24.00 .
Additional Warrants Issued
4 unchanged sentences
Notes to the Condensed Consolidated Financial Statements (Unaudited)
−Removed: A summary of warrants activity during the six months ended June 30, 2024 and 2023 is presented below:
+Added: A summary of warrants activity during the nine months ended September 30, 2024 and 2023 is presented below:
Weighted-average
4 unchanged sentences
Outstanding, December 31, 2022 19.30 1,803,364 3.51 —
−Removed: Granted — — N/A —
−Removed: Exercised — — N/A —
+Added: Granted 24.00 215,331 3.14 —
+Added: Exercised 10.00 ( 215,331 ) 3.15 215
Forfeited — — N/A —
−Removed: Outstanding, June 30, 2023 1.93 18,033,640 3.01 —
−Removed: Exercisable, June 30, 2023 1.93 18,033,640 3.01 —
+Added: Outstanding, September 30, 2023 20.20 1,803,364 2.80 —
+Added: Exercisable, September 30, 2023 20.20 1,803,364 2.80 —
Outstanding, December 31, 2023 19.69 1,738,002 2.61 —
2 unchanged sentences
Forfeited 31.47 ( 144,982 ) N/A —
−Removed: Outstanding, June 30, 2024 1.89 16,021,747 2.31 —
−Removed: Exercisable, June 30, 2024 1.89 16,021,747 2.31 —
+Added: Outstanding, September 30, 2024 18.62 1,593,020 2.07 —
+Added: Exercisable, September 30, 2024 18.62 1,593,020 2.07 —
Stock-Based Compensation Expense
−Removed: Stock-based compensation related to restricted stock issued to employees, directors and consultants, warrants and warrants to consultants amounted to $ 1.9 million and $ 2.7 million, respectively for the three and six months ended June 30, 2024, of which $ 0.1 million, $ 0.1 million, were executive compensation, $ 35.2 thousand and $ 0.1 million, were given to the board of directors, $ 0.1 million and $ 0.2 million, were given to consultants for services rendered and $ 1.7 million and $ 2.4 million, were stock-based consulting expenses paid to related party.
−Removed: Stock-based compensation related to restricted stock issued to employees, directors and consultants, warrants and warrants to consultants amounted to $ 1.2 million and $ 4.6 million respectively for the three and six months ended June 30, 2023, respectively, of which $ 20.3 thousand and $ 40.9 thousand, were executive compensation, $ 45.4 thousand and $ 0.1 million, were given to the board of directors, $ 40.9 thousand and $ 40.9 thousand were given to consultants for services rendered and $ 1.1 million and $ 4.4 million were stock-based consulting expenses paid to related party.
+Added: Stock-based compensation related to restricted stock issued to employees, directors and consultants amounted to $ 1.7 million and $ 4.4 million, respectively for the three and nine months ended September 30, 2024, of which $ 0.1 million, $ 0.2 million, were executive compensation, $ 36.4 thousand and $ 0.1 million, were given to the board of directors, $ 0.1 million and $ 0.3 million, were given to consultants for services rendered and $ 1.5 million and $ 3.9 million, were stock-based consulting expenses paid to related party.
+Added: Stock-based compensation related to restricted stock issued to employees, directors and consultants, warrants and warrants to consultants amounted to $ 1.1 million and $ 5.7 million respectively for the three and nine months ended September 30, 2023, respectively, of which $ 20.3 thousand and $ 0.1 million, were executive compensation, $ 0.1 million and $ 0.1 million, were given to the board of directors, $ 0.3 million and $ 0.4 million were given to consultants for services rendered and $ 0.7 million and $ 5.1 million were stock-based consulting expenses paid to related party.
Sadot Group, Inc.
3 unchanged sentences
At the meeting, the shareholders approved (i) the Services Agreement whereby Sadot LLC engaged Aggia, to provide certain advisory services to Sadot Agri-Food for managing Sadot Agri-Food’s business of wholesaling food and engaging in the purchase and sale of physical food commodities;
−Removed: (ii) an amendment of the Company’s articles of incorporation to increase the number of authorized shares of common stock from 50.0 million to 150.0 million;
+Added: (ii) an amendment of the Company’s articles of incorporation to increase the number of authorized shares of common stock from 5,000,000 to 15,000,000 ;
(iii) for purposes of complying with NASDAQ Listing Rule 5635(b), the issuance of the Shares pursuant to the Services Agreement entered between the Company, Sadot LLC and Aggia representing more than 20 % of our common stock outstanding, which would result in a “change of control” of the Company under applicable Nasdaq listing rules;
−Removed: (iv) for purposes of complying with NASDAQ Listing Rule 5635(c), the issuance of up to 14.4 million Shares of Common Stock to Aggia pursuant to the Services Agreement and net income generated thresholds;
+Added: (iv) for purposes of complying with NASDAQ Listing Rule 5635(c), the issuance of up to 1,442,428 Shares of Common Stock to Aggia pursuant to the Services Agreement and net income generated thresholds;
(v) the right of Aggia to nominate up to eight directors to the Board of Directors subject to achieving net income thresholds as set forth in the Services Agreement;
and (vi) the adoption of the 2023 Equity Incentive Plan.
−Removed: The shareholders of the Company subsequently approved an increase in the authorized shares of common stock from 150.0 million to 200.0 million at the Company’s Annual Meeting held on December 20, 2023.
−Removed: As of June 30, 2024, Aggia owned 22.8 % of the Company's common stock.
−Removed: During the three and six months ended June 30, 2024, the Company recorded Stock-based consulting expense of $ 1.7 million, $ 2.4 million, and $ 1.1 million and $ 4.4 million, for the three and six months ended June 30, 2023 respectively, to its related party, Aggia for consulting services rendered.
−Removed: Additionally, for the three and six months ended June 30, 2024, the Company reimbursed Aggia for all operating costs related to Sadot Agri-Foods of $ 1.0 million and $ 2.1 million and $ 1.0 million and $ 1.8 million for the three and six months ended June 30, 2023 respectively.
+Added: The shareholders of the Company subsequently approved an increase in the authorized shares of common stock from 15,000,000 to 20,000,000 at the Company’s Annual Meeting held on December 20, 2023.
+Added: As of September 30, 2024, Aggia owned 11.8 % of the Company's common stock.
+Added: During the three and nine months ended September 30, 2024, the Company recorded Stock-based consulting expense of $ 1.5 million, and $ 3.9 million, respectively, to its related party, Aggia for consulting services rendered.
+Added: During the three and nine months ended September 30, 2023, the Company recorded Stock-based consulting expense of $ 0.7 million and $ 5.1 million, respectively, to its related party, Aggia for consulting services rendered.
+Added: Additionally, for the three and nine months ended September 30, 2024, the Company reimbursed Aggia for all operating costs related to Sadot Agri-Foods of $ 0.8 million and $ 2.9 million.
+Added: For the three and nine months ended September 30, 2023 the Company reimbursed Aggia for all operating costs related to Sadot Agri-Foods of $ 1.0 million and $ 2.8 million, respectively.
+Added: On September 19, 2024, the Company received a loan from a related party, in an arms length transaction, of $ 0.6 million, with a discount of $ 0.1 million, that matures in six months .
The Company will continue to monitor and evaluate its related party transactions to ensure that they are conducted in accordance with applicable laws and regulations and in the best interests of the Company and its shareholders.
2 unchanged sentences
Subsequent Events
−Removed: On August 1, 2024, the Company sold Superfit Foods LLC, which was previously held for sale.
−Removed: There was no material gain or loss on the transaction.
−Removed: On July 18, 2024, the Company re-franchised its Bronx, NY Muscle Maker Grill location.
−Removed: There was no material gain or loss on the transaction.
+Added: Promissory Notes
+Added: On October 10, 2024, the Company issued a Convertible Promissory Note in the principal amount of $ 1.4 million in consideration of cash in the amount of $ 1.1 million.
+Added: On October 11, 2024, the Company paid off its loan Yorkville in the amount of $ 800,000 .
+Added: On October 15, 2024, the Company entered into a Standard Merchant Cash Advance Agreement with Cedar Advance LLC
+Added: (“Cedar”) providing for the sale of receivables in the amount of $ 3.2 million for the purchase price of $ 2.4 million.
+Added: The Company granted Cedar a security interest in (a) all accounts, including without limitation, all deposit accounts, accounts receivable, and other receivables, as those terms are defined by Article 9 of the Uniform Commercial Code (the “UCC”), now or hereafter owned or acquired by the Company;
+Added: and (b) all proceeds, as that term is defined by Article 9 of the UCC.
+Added: The Company agreed not to create, incur, assume, or permit to exist, directly or indirectly, any lien on or with respect to any of the Collateral.
+Added: The Company paid off the remaining balance of the previous Cedar advance of $ 1.1 million in this transaction.
+Added: Farming Operations
+Added: The Company made the decision not to plant crops in its farming operations in Zambia for this upcoming season due to drought conditions and a dispute with the minority shareholder regarding farm operations.
+Added: Legal Complaint
+Added: On November 7, 2024, Lombard Trading International Corp.
+Added: filed an Amended Complaint against the Company and Sadot Latam, LLC in the 11th Judicial Circuit of Florida in and for Miami-Dade County, Florida (Case No.:
+Added: 2024-020971-CA-01).
+Added: The Amended Complaint alleges unjust enrichment, conversion, fraud, conspiracy and civil theft related to a commodities transaction.
+Added: The plaintiff claims that the Company failed to pay upon delivery of certain goods and is seeking damages in the amount of $ 7.4 million.
+Added: The Company denies these allegations and intends to vigorously defend against the claims.
+Added: While the Company believes it has meritorious defenses, it cannot predict the outcome of this matter or reasonably estimate the potential loss at this time
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.