What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2025-05-14 compared with 2024-11-12 · 459 added, 685 removed, 661 unchanged (63% of the section changed)

2 unchanged sentences

Condensed Consolidated Balance Sheets

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

Current assets:

Cash 1,940 1,786

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

Accounts receivable, net of allowance for doubtful accounts of $ 0.3 million and $ 0.1 million as of March 31, 2025 and December 31, 2024, respectively

47,751 18,014

3 unchanged sentences

Total current assets 71,802 152,679

Right to use assets 137 1,284

Property and equipment, net 11,793 11,820

Goodwill — 1,798

Intangible assets, net — 2,833

Other non-current assets 149 155

3 unchanged sentences

Accounts payable and accrued expenses 36,682 28,019

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

Notes payable, current, net of discount of $ 0.7 million and $ 0.9 million as of March 31, 2025 and December 31, 2024, respectively

Deferred revenue, current 74 2,251

2 unchanged sentences

Total current liabilities 49,934 132,170

Contract liability, non-current — 46,048

Notes payable, non-current — 622

Operating lease liability, non-current 117 1,027

Deferred revenue, non-current — 1,555

Other non-current liabilities 105 111

Total liabilities 50,039 132,281

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

Common stock, $ 0.0001 par value, 20,000,000 shares authorized, 5,412,500 and 5,225,147 shares issued and outstanding as of March 31, 2025 and December 31, 2024, respectively

Additional paid-in capital 113,004 112,406

Accumulated deficit ( 82,249 ) ( 83,187 )

Accumulated other comprehensive (loss) / income ( 180 ) 8

Accumulated other comprehensive loss ( 113 ) ( 27 )

Total Sadot Group Inc.

6 unchanged sentences

Condensed Consolidated Statement of Operations and Other Comprehensive Income / (Loss)

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

$’000 $’000 $’000 $’000

Three Months Ended March 31,

Commodity sales 132,168 106,507

Company restaurant sales, net of discounts 479 1,937 2,628 6,725

Franchise royalties and fees 321 245 1,319 767

Franchise advertising fund contributions 12 16 40 52

Other revenues 16 — 16 13

Cost of goods sold ( 126,156 ) ( 103,697 )

Gross profit 6,012 2,810

Impairment of goodwill — ( 828 ) — ( 828 )

Impairment of intangible assets — ( 810 ) — ( 810 )

Depreciation and amortization expenses ( 27 ) ( 91 )

Franchise advertising fund expenses ( 12 ) ( 16 ) ( 40 ) ( 52 )

Pre-opening expenses — ( 335 ) — ( 371 )

Post-closing expenses ( 91 ) ( 60 ) ( 120 ) ( 173 )

Stock-based expenses ( 1,428 ) ( 796 )

Sales, general and administrative expenses ( 3,081 ) ( 1,393 )

Loss from operations ( 3,647 ) ( 3,972 ) ( 9,146 ) ( 5,939 )

Other income — 1 19 252

Income from operations 1,476 530

Interest expense, net ( 1,541 ) ( 228 )

Change in fair value of stock-based compensation 778 476

Warrant modification expense — ( 958 ) — ( 958 )

Gain / (loss) on fair value remeasurement 5,461 ( 349 ) 11,995 ( 349 )

Gain on sale of trading securities — — 518 —

Income / (Loss) Before Income Tax 1,097 ( 5,282 ) 3,108 ( 6,153 )

Income for continuing operations before income tax 713 778

Income tax expense — ( 1 )

Net income for continuing operations 713 777

Discontinued Operations:

Income / (loss) for discontinued operations, net of income tax 107 ( 1,090 )

Net income / (loss) for discontinued operations 107 ( 1,090 )

Net income / (loss) 820 ( 313 )

1 unchanged sentence

Net income / (loss) attributable to Sadot Group Inc.

1,163 ( 5,183 ) 3,268 ( 6,059 )

Net Income / (Loss) Per Share attributable to Sadot Group Inc.:

Net income from continuing operations per share attributable to Sadot Group Inc.:

Basic 0.16 0.20

Diluted 0.16 0.20

Net income / (loss) from discontinued operations per share:

Basic 0.02 ( 0.26 )

Diluted 0.02 ( 0.26 )

Weighted-average # of common shares outstanding:

5 unchanged sentences

(Unaudited) (Continued)

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

$’000 $’000 $’000 $’000

Three Months Ended March 31,

Net income / (loss) 820 ( 313 )

1 unchanged sentence

Foreign exchange translation adjustment 2 —

Unrealized loss, net of income tax ( 1 ) — ( 187 ) —

Unrealized loss ( 88 ) ( 60 )

Total other comprehensive loss ( 86 ) ( 60 )

2 unchanged sentences

Total Comprehensive income / (loss) attributable to Sadot Group Inc.

1,158 ( 5,183 ) 3,080 ( 6,059 )

See Accompanying Notes to the Condensed Consolidated Financial Statements (Unaudited)

9 unchanged sentences

Common stock issued as compensation for services 58,344 — 175 — — — 175

Stock-based compensation - options — — 27 — — — 27

Conversion of convertible loan 284,139 — 965 — — — 965

Stock based compensation - vesting of options and restricted stock awards 23,913 — 111 — — — 111

Unrealized loss, net of income tax — — — — ( 60 ) — ( 60 )

Net loss — — — ( 265 ) — ( 48 ) ( 313 )

Balance at March 31, 2024 4,423,432 — 109,285 ( 87,444 ) ( 52 ) 3,388 25,177

Common stock compensation to board of directors 2,974 — 32 — — — 32

Common stock issued as compensation for services 371,438 — 4,348 — — — 4,348

Stock-based compensation - options — — 27 — — — 27

Net income — — — 190 — — 190

Balance at June 30, 2023 3,591,145 — 103,395 ( 80,231 ) — — 23,164

Common stock compensation to board of directors 3,289 — 39 — — — 39

Common stock issued as compensation for services 81,558 — 654 — — — 654

Cash exercise of warrants and warrant modification 215,331 — 3,111 — — — 3,111

Stock-based compensation - options — — 27 — — — 27

Investment in non-controlling interest — — — — — 3,654 3,654

Net loss — — — ( 5,183 ) — ( 112 ) ( 5,295 )

Balance at September 30, 2023 3,891,323 — 107,226 ( 85,414 ) — 3,542 25,354

See Accompanying Notes to the Condensed Consolidated Financial Statements (Unaudited)

8 unchanged sentences

Balance at December 31, 2024 5,225,147 1 112,406 ( 83,187 ) ( 27 ) 3,180 32,373

Common stock compensation to board of directors 10,564 — 42 — — — 42

Common stock issued as compensation for services 113,416 — 315 — — — 315

Conversion of convertible loan 284,139 — 965 — — — 965

Stock based compensation - vesting of options and restricted stock awards 73,937 — 283 — — — 283

Foreign exchange translation adjustment — — — — 2 — 2

Unrealized loss, net of income tax — — — — ( 60 ) 0 ( 60 )

Net loss — — — ( 265 ) — ( 48 ) ( 313 )

Balance at March 31, 2024 4,423,432 — 109,285 ( 87,444 ) ( 52 ) 3,388 25,177

Common stock compensation to board of directors — — — — — — —

Common stock issued as compensation for services 139,899 — 535 — — — 535

Stock based compensation - vesting of options and restricted stock awards 33,177 — 146 — — — 146

Foreign exchange translation adjustment — — — — 3 — 3

Unrealized loss, net of income tax — — — — ( 126 ) — ( 126 )

Net income / (loss) — — — 2,369 — ( 52 ) 2,317

Balance at June 30, 2024 4,596,508 — 109,966 ( 85,075 ) ( 175 ) 3,336 28,052

Common stock compensation to board of directors — — — — — — —

Common stock issued as compensation for services 168,649 — 723 — — — 723

Conversion of convertible loan 221,779 1 819 — — — 820

Stock based compensation - vesting of options and restricted stock awards 33,177 — 142 — — — 142

Foreign exchange translation adjustment — — — — ( 4 ) — ( 4 )

Unrealized loss, net of income tax — — — — ( 1 ) — ( 1 )

Reconciliation of post-split shares outstanding per transfer agent 260 — — — — — —

Unrealized loss — — — — ( 88 ) — ( 88 )

Net income / (loss) — — — 938 — ( 118 ) 820

Balance at September 30, 2024 5,020,373 1 111,650 ( 83,912 ) ( 180 ) 3,267 30,826

Balance at March 31, 2025 5,412,500 1 113,004 ( 82,249 ) ( 113 ) 3,062 33,705

See Accompanying Notes to the Condensed Consolidated Financial Statements (Unaudited)

1 unchanged sentence

Condensed Consolidated Statements of Cash Flows

Nine Months Ended September 30,

Three Months Ended March 31,

Cash Flows from Operating Activities

Net income / (loss) 820 ( 313 )

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

Impairment of goodwill — 828

Impairment of intangible assets — 810

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

Depreciation and amortization 27 91

Amortization of debt discount 406 —

Stock-based expenses 1,428 796

Change in fair value of compensation ( 2,691 ) ( 1,161 )

Warrant modification expense — 958

Unrealized loss, net of income tax ( 187 ) —

Foreign exchange translation adjustment ( 1 ) —

Loss on disposal of assets 304 301

Gain / (loss) on fair value remeasurement 18,602 ( 3,259 )

Change in fair value of stock-based compensation ( 778 ) 476

Bad debt expense 164 77

Transfer to assets held for sale ( 481 ) —

Changes in operating assets and liabilities:

5 unchanged sentences

Other current liabilities ( 92,154 ) ( 3,208 )

Contract liability, non-current ( 46,048 ) —

Operating right to use assets and lease liabilities, net 56 ( 46 )

Other non-current liabilities 115 —

Deferred revenue ( 2,177 ) 1,031

1 unchanged sentence

Net cash provided by / (used in) operating activities ( 2,950 ) 2,507

Net cash provided by operating activities - discontinued operations 8 104

Cash Flows from Investing Activities

Deposit on farmland ( 5,853 ) 4,914

Investment from non-controlling interest — 3,655

Purchases of property and equipment ( 38 ) ( 12,447 )

Disposal of property and equipment — 29

Net cash provided by / (used in) investing activities ( 5,429 ) ( 3,670 )

Net cash provided by investing activities — 29

Net cash provided by investing activities - discontinued operations — 29

Cash Flows from Financing Activities

Proceeds from notes payable 4,581 1,500

Proceeds from exercise of warrants — 2,153

Repayments of notes payable ( 1,467 ) ( 4,261 )

Net cash (used in) provided by financing activities ( 1,943 ) 4,873

Net cash provided by / (used in) financing activities 3,114 ( 2,761 )

Net cash used in financing activities - discontinued operations ( 20 ) ( 36 )

Foreign exchange translation adjustment 2 ( 12 )

Net Increase (Decrease) in Cash 154 ( 140 )

4 unchanged sentences

Condensed Consolidated Statements of Cash Flows (Continued)

Nine Months Ended September 30,

Three Months Ended March 31,

Supplemental Disclosures of Cash Flow Information:

Cash paid for interest 1,807 495

Cash paid for taxes 19 —

Supplemental Disclosures of Non-Cash Investing and Financing Activities

Conversion of notes payable into common stock 1,784 —

See Accompanying Notes to the Condensed Consolidated Financial Statements (Unaudited)

5 unchanged sentences

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.

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.

As of September 30, 2024, SGI consisted of two distinct operating units:

Sadot Group is headquartered in Burleson, Texas with subsidiary operations throughout the United States, Brazil, Canada, Colombia, India, Israel, South Korea, Singapore, Ukraine, United Arab Emirates and Zambia.

As of March 31, 2025, Sadot Group consisted of one distinct operating unit and one discontinued operations.

Sadot LLC (“Sadot Agri-Foods”):

2 unchanged sentences

Sadot Agri-Foods operates, through a majority owned subsidiary, a roughly 5,000 acre crop producing farm in Zambia with a focus on major commodities such as wheat, soy and corn alongside high-value tree crops such as avocado and mango.

In addition, the Company has a deposit on farmland in Indonesia.

Sadot Agri-Foods was formed as part of the Company’s diversification strategy to own and operate, through its subsidiaries, the business lines throughout the food supply chain.

1 unchanged sentence

Sadot Restaurant Group, LLC ("Sadot Food Services"):

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.

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.

Each of our concepts offers different menus that are tailored to specific consumer segments.

We believe our concepts deliver highly differentiated customer experiences.

This entire operating segment was identified as held for sale.

Please see Note 3 – Assets held for sale for further details.

had three unique “healthier for you” concepts, including two fast casual restaurant concepts, Pokémoto and Muscle Maker Grill, During 2024, the Company operated a subscription-based fresh prep meal concept, SuperFit Foods, which was sold in August 2024.

Throughout 2024 the remaining corporate owned restaurants were sold and converted into franchise locations or closed.

As of the end of 2024 the Company only operates as the franchisor for Pokémoto and Muscle Maker Grill restaurants.This entire operating segment was identified as held for sale and reported as discontinued operations.

Please see Note 3 – Assets held for sale and Note 4 – Discontinued operations for further details.

Sadot Group Inc.

and its subsidiaries are hereinafter referred to as the “Company”.

Recent Corporate Developments

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.

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.

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.

There was no change in the par value of the Company's common stock.

On March 26, 2025, SGI launched Sadot South Korea, marking a significant step in Sadot’s strategic expansion into Northeast Asia, using South Korea’s strong logistics and trade infrastructure as a hub for global agri-trade activities.

The Company's primary source of liquidity is cash on hand.

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.

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.

The Company had Net cash provided by operations of $ 7.0 million for the nine months ended September 30, 2024.

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.

As of March 31, 2025, the Company had a cash balance, a working capital surplus and an accumulated deficit of $ 1.9 million, $ 21.9 million, and $ 82.2 million, respectively.

During the three months ended March 31, 2025, the Company generated Net income of $ 0.8 million.

The Company had Net cash used in operations of $ 2.9 million for the three months ended March 31, 2025.

While the Company maintains a base of current assets, including inventories and receivables, the timing and certainty of converting these assets into cash has presented operational challenges.

The Company continues to manage its liquidity needs through ongoing collection efforts, working capital optimization strategies, and active engagement with financing partners.

While there is uncertainty around the precise timing of cash inflows, management believes that its current asset base, proceeds from our factoring arrangement and access to additional sources of liquidity, if necessary, provide flexibility to support ongoing operations in the near term.

Under the factoring agreement, certain eligible receivables may be sold with recourse in exchange for an upfront advance of 85 % of the net invoice value, with the remaining amount remitted upon collection, less applicable fees and reserves.

While the Company maintains sufficient working capital through its accounts receivable and factoring capacity, we are currently experiencing delays in converting receivables into cash, which may impact the timing of our available liquidity.

We continue to actively manage collections and factoring utilization to address short-term liquidity needs and ensure ongoing operational funding.

Sadot Group, Inc.

2 unchanged sentences

We measure our liquidity in a number of ways, including the following:

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

Cash 1,940 1,786

2 unchanged sentences

Other current assets (1)

16,925 126,966

Assets held for sale (2)

3 unchanged sentences

Other current liabilities (3)

94,466 47,884

Liabilities held for sale (4)

1 unchanged sentence

Working capital (5)

21,868 20,509

Current ratio (6)

(1) Consists of VAT, prepaid expenses, derivative assets, unrealized gain on derivative contracts, deposit on farmland and deposit on acquisition

(2) See Note 3 for additional information

(3) Consists of Operating lease liability, current, Deferred revenue, current and Other current liabilities

(4) See Note 3 for additional information

(5) Working Capital is defined as Total current assets less Total current liabilities

(6) Current ratio is defined as Total current assets divided by Total current liabilities

(4) See Note 3 for additional information

(5) See Note 3 for additional information

Significant Accounting Policies

2 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.

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.

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.

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 March 31, 2025, and for the three months ended March 31, 2025, and 2024.

The results of operations for the three months ended March 31, 2025, and 2024 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, 2024, filed with the Securities and Exchange Commission (“SEC”) on March 11, 2025.

The Balance Sheet as of December 31, 2024, has been derived from the Company’s audited Financial Statements.

7 unchanged sentences

These reclassifications have no effect on the previously reported results of operations or loss per share.

Reclassification of Fair Value Gains from Other Income

During the three months ended March 31, 2025, the Company reclassified gains previously recognized in Other income related to the fair value remeasurement of certain financial instruments into Cost of goods sold ("COGS").

The reclassification was made to better reflect the nature and function of these instruments, which are economically linked to the Company’s inventory procurement, sales activities and to be consistent with our competitors.

Management determined that presenting the related gains in COGS more accurately reflects the impact of these instruments on the Company’s gross margin and provides more decision-useful information to financial statement users.

This change in presentation had no impact on net income, total comprehensive income, or earnings per share for the period.

The table below summarizes the effect of the reclassification on the Unaudited Condensed Consolidated Statement of Income and Other Comprehensive Income / (Loss) for the three months ended March 31, 2024:

As Previously Reported Reclassification As Reclassified % Change

$’000 $’000 $’000 %

Cost of goods sold ( 106,945 ) 3,248 ( 103,697 ) ( 3.0 ) %

Gross profit / (loss) ( 438 ) 3,248 2,810 741.6 %

Gain on fair value remeasurement 3,259 ( 3,259 ) — ( 100.0 ) %

Loss on hedge contracts ( 11 ) 11 — ( 100.0 ) %

Net Income ( 313 ) — ( 313 ) — %

Use of Estimates

12 unchanged sentences

The Company considers all highly-liquid instruments with an original maturity of three months or less when purchased to be cash equivalents.

There were no cash equivalents as of September 30, 2024 or December 31, 2023.

There were no cash equivalents as of March 31, 2025 or December 31, 2024.

Sadot Group, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

Accounts Receivable

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 consists of receivables related to Sadot Agri-Foods of $ 47.8 million and $ 18.0 million net of doubtful accounts of $ 0.3 million and $ 0.1 million as of March 31, 2025, and December 31, 2024, respectively.

From time to time the Company may set aside and/or assign accounts receivables towards the acquisition of various assets.

The net Accounts Receivable balance of $ 47.8 million and $ 18.0 million at March 31, 2025 and December 31, 2024, includes $ 13.4 million in receivables that the Company plans to assign to a third party, which is expected to be paid in assets other than cash.

The Company and the third party are in negotiations regarding the timing and nature of the assets to be received, and the Company continues to evaluate the balance for expected losses.

As of March 31, 2025, the Company deemed it would receive assets valued at the full balance.

Accounts receivable is stated at historical carrying amounts net of write-offs and allowances for uncollectible accounts.

5 unchanged sentences

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.

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.

Factoring Agreements

As of March 31, 2025, the Company’s total borrowings include $ 3.8 million related to a factoring arrangement under which the Company transfers certain trade receivables to a third-party financial institution with recourse.

The Company retains the risk of nonpayment on the transferred receivables, so the arrangement does not meet the criteria for sale accounting under ASC 860, Transfers and Servicing, and is accounted for as a secured borrowing.

Under this arrangement, the Company received $ 3.5 million in cash advances, which are included in Notes Payable on the Unaudited Condensed Consolidated Balance Sheets.

The transferred receivables, with a carrying value of $ 4.1 million as of March 31, 2025, remain recorded in Accounts receivable, as the Company has not surrendered control over the assets.

The difference of $ 0.6 million primarily reflects the advances held by the factor of $ 0.3 million and factoring fees of $ 0.3 million.

Factoring fees incurred in connection with the arrangement are deferred and amortized over the expected life of the borrowing as Interest expense, net in the Unaudited Condensed Consolidated Statements of Income and Other Comprehensive Income / (Loss).

The Company continues to service the receivables under the arrangement but has no obligation to repurchase the receivables except in cases of customer nonpayment.

The Company remains exposed to credit losses related to factored receivables and maintains an allowance for doubtful accounts as appropriate.

As of March 31, 2025, the Company has pledged $ 4.1 million of accounts receivable as collateral under this facility.

Inventory, which are stated at the lower of cost or net realizable value, related to Sadot Agri-foods was $ 0.3 million and $ 0.7 million as of March 31, 2025 and December 31, 2024, respectively.

Cost is determined using the first-in, first-out method.

Assets held for sale

Sadot Group, Inc.

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.

2 unchanged sentences

• the disposal group(s) are available for immediate sale in present condition,

Sadot Group, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

• an active program to locate a buyer and other actions required to complete the plan to sell have been initiated,

22 unchanged sentences

In accordance with ASC 350, the Company does not amortize intangible assets having indefinite useful lives.

The Company’s goodwill has an indefinite life and is not amortized, but is evaluated for impairment at least annually, or more often whenever changes in facts and circumstances may indicate that the carrying value may not be recoverable.

ASC 350 requires that goodwill be tested for impairment at the reporting unit level (operating segment or one level below an operating segment).

Application of the goodwill impairment test requires judgment, including the identification of reporting units, assigning assets and liabilities to reporting units, assigning goodwill to reporting units, and determining the fair value.

The Company’s goodwill has an indefinite life and is not amortized.

The Company's goodwill and intangible assets with a finite life are evaluated for impairment at least annually, or more often whenever changes in facts and circumstances may indicate that the carrying value may not be recoverable.

ASC 350 requires that goodwill and intangible assets be tested for impairment at the reporting unit level (operating segment or one level below an operating segment).

Application of the impairment testing requires judgment, including the identification of reporting units, assigning assets and liabilities to reporting units, assigning goodwill and intangible assets to reporting units, and determining the fair value.

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.

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.

Changes in these estimates and assumptions could materially affect the determination of fair value and/or impairment.

In the first quarter of 2024, the intangible assets were moved to assets held for sale.

See Note 3 – Assets held for sale for additional information.

Impairment of Long-Lived Assets

Sadot Group, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

estimating the undiscounted cash flows (excluding interest charges) from the expected future operations of the asset.

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.

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.

1 unchanged sentence

Any impairment losses are recorded as operating expenses, which reduce net income.

Sadot Group, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

Convertible Instruments

1 unchanged sentence

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.

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.

As of March 31, 2025 and December 31, 2024, the Company deemed the conversion feature related to notes payable was not required to be bifurcated and recorded as a derivative liability.

Related Parties

17 unchanged sentences

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.

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)

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

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.

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.

The Company recognizes revenues from gift cards as restaurant revenues once the Company performs its obligation to provide food and beverage to the customer simultaneously with the redemption of the gift card or through gift card breakage.

Franchise Royalties and Fees

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.

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.

The Company capitalizes these fees upon collection from the franchisee.

These initial fees are then recognized as franchise fee revenue on a straight-line basis over the life of the related franchise agreements and any exercised renewal periods.

Cash payments are due upon the execution of the related franchise agreement.

The Company’s performance obligation with respect to franchise fee revenues consists of a license to utilize the Company’s brand for a specified period of time, which is satisfied equally over the life of each franchise agreement.

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.

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.

Pursuant to the terms of these agreements, rebates are provided to the Company based upon the dollar volume of purchases for all company-owned and franchised restaurants from these vendors.

Rebates earned on purchases by franchise stores are recorded as revenue during the period in which the related food and beverage purchases are made.

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.

Franchise Advertising Fund Contributions

Under the Company’s franchise agreements, the Company and its franchisees are required to contribute a certain percentage of revenues to a national advertising fund.

The Company’s national advertising services are provided on a system-wide basis and therefore, not considered distinct performance obligations for individual franchisees.

In accordance with Topic 606, the Company recognizes these sales-based advertising contributions from franchisees as franchise revenue

Sadot Group, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

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.

When an advertising contribution fund is over-spent at year-end, advertising expenses will be reported on the Unaudited Condensed Consolidated Statement of Operations in an amount that is greater than the revenue recorded for advertising contributions.

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.

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).

During the three months ended March 31, 2025 and 2024, the Company recorded Commodity sales revenues of $ 132.2 million and $ 106.5 million, respectively, which is included in Commodity sales on the accompanying Unaudited Condensed Consolidated Statements of Operations and Other Comprehensive Income / (Loss).

Deferred Revenue

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Deferred revenue related to Sadot Food Services is recognized in income over the life of the franchise.

If a franchise location closes or a franchise agreement is terminated for any reason, the remaining deferred revenue will be recognized in full at that time.

If a franchise location closes or a franchise agreement is terminated for any reason,

Sadot Group, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

the remaining deferred revenue will be recognized in full at that time.

Deferred revenue related to Sadot Agri-Foods is recognized at the completion of each commodity forward sales contract agreement.

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This includes stock-based consulting fees due to Aggia and other consultants, stock compensation paid to the Company's board of directors, and stock compensation paid to employees.

The consulting fees due to Aggia related to ongoing Sadot Agri-Foods and expansion of the global agri-foods business.

The consulting fees due to Aggia are related to ongoing Sadot Agri-Foods and expansion of the global agri-foods business.

Based on the initial Services Agreement with Aggia LLC FZ, a Company formed under the laws of United Arab Emirates (“Aggia”), the consulting fees were calculated at approximately 80.0 % of the Net Income generated by Sadot Agri-Foods through March 31, 2023.

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See Note 17 – Commitments and contingencies for further details.

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).

Stock-based expenses for the three months ended March 31, 2025 and 2024 were $ 1.4 million and $ 0.8 million, respectively, and are recorded in the accompanying Unaudited Condensed Consolidated Statements of Operations and Other Comprehensive Income / (Loss).

Net Income (Loss) per Share

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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.

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:

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

The following securities are excluded from the calculation of weighted average diluted common shares at March 31, 2025 and 2024, respectively, because their inclusion would have been anti-dilutive:

Three Months Ended March 31,

Warrants 1,586,449 1,705,637

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Total potentially dilutive shares 3,075,586 3,622,518

The following table sets forth the computation of basic and dilutive net income / (loss) per share attributable to the Company’s stockholders:

Sadot Group, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

The following table sets forth the computation of basic and dilutive net income / (loss) per share attributable to the Company’s stockholders:

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Three Months Ended March 31,

(In thousands, except for share count and per share data)

Net income / (loss) attributable to Sadot Group Inc.

1,163 ( 5,183 ) 3,268 ( 6,059 )

Weighted-average shares outstanding:

Basic 5,227,444 4,186,905

Effect of potentially dilutive stock options — — — —

Effect of potentially dilutive RSAs 18,420 —

Effect of potentially dilutive convertible debt 242,424 — 242,424 —

Diluted 5,245,864 4,186,905

Net income for continuing operations per share attributable to Sadot Group Inc.:

Basic 0.16 0.20

Diluted 0.16 0.20

Net income / (loss) from discontinued operations per share attributable to Sadot Group Inc.:

Basic 0.02 ( 0.26 )

Diluted 0.02 ( 0.26 )

Net income / (loss) per share attributable to Sadot Group Inc.:

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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:

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

Three Months Ended March 31,

Number of vendors 3 5

Type Commodities Commodities Commodities Commodities

Type Commodities Commodities

% of purchases 97 % 95 %

Major Customers

The following table sets forth the major customers:

Three Months Ended March 31,

Number of customers 1 4

Type Commodities Commodities

% of sales 92 % 79 %

Derivative Instruments

The Company is exposed to market risks primarily related to the volatility in the price of carbon offset units and food and feed commodities (e.g., soybeans, wheat and corn).

To manage these risks, the Company enters into forward sales contracts and hedges from time to time.

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.

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.

Forward sales contract are initially measured at fair value and any changes in fair value of the forward sales contracts are recorded as Gain / (loss) on fair value remeasurement in the Unaudited Condensed Consolidated Statement of Operations and Other Comprehensive Income / (Loss) for each reporting period.

The Company also enters into hedging transactions to mitigate exposures to fluctuations in agricultural commodity prices.

We enter into these derivative contracts for periods consistent with the related underlying exposures, and the contracts do not constitute positions independent of those exposures.

We do not enter into derivative contracts for speculative purposes and do not use leveraged instruments.

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.

Changes in fair

Sadot Group, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

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.

The Company does not offset its derivative assets and liabilities within the Unaudited Condensed Consolidated Balance Sheets.

Changes in the fair value of derivative instruments and cash flows from derivative contracts are included in Net cash provided by (used in) operating activities in the Condensed Consolidated Statement of Cash Flows.

The Company recognizes all derivatives in the balance sheet at fair value.

During the three months ended March 31, 2025 and 2024, the Company’s derivatives were comprised of Forward sales contracts for soybeans, carbon offset units, and futures and options of food and feed related commodities, traded on the Chicago Mercantile Exchange ("CME").

Derivatives that do not meet the requirements for hedge accounting to be applied per FASB ASC 815, Derivatives and Hedging, are adjusted to fair value through earnings.

If the derivative does meet the criteria in ASC 815 to use hedge accounting, depending upon the nature of the hedge, the effective portion of changes in the fair value of the hedged assets, liabilities or firm commitments through earnings (fair value hedge), or recognized in other comprehensive income until the hedged item is recognized in earnings (cash flow hedge).

The ineffective portion of a derivative’s change in fair value, if any, is immediately recognized in earnings.

When a hedged item in a fair value hedge is sold, the adjustment in the carrying amount of the hedged item is recognized in earnings.

Refer to Fair Value of Financial Instruments below, Note 17 – Commitments and contingencies and Note 20 – Financial instruments for additional information regarding the Company’s derivative instruments.

Fair Value of Financial Instruments

The Company measures the fair value of financial assets and liabilities based on the guidance of the FASB Accounting ASC 820 “Fair Value Measurements and Disclosures” (“ASC 820”).

The Company measures the fair value of financial assets and liabilities based on the guidance of the FASB ASC 820 “Fair Value Measurements and Disclosures” (“ASC 820”).

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

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Level 3 — inputs to the valuation methodology are unobservable and significant to the fair value measurement.

See Note 17 – Fair value measurement for a summary of financial liabilities held at carrying amount including the Accrued compensation liability, Forward sales derivatives and the Derivative liability.

For details related to the fair value of the Accrued compensation liability measured using Level 1 inputs, refer to Note 19 – Equity for details related to the fair value of the Forward sales derivatives and Derivative liability measured using Level 2 inputs, refer to Note 15 – Commitments and contingencies and Note 18 – Financial instruments.

See Note 19 – Fair value measurement for a summary of financial liabilities held at carrying amount including unrealized gain on derivative contracts and the unrealized loss on derivative contracts.

For details related to the fair value of the unrealized gain on derivative contracts and unrealized loss on derivative contracts measured using Level 2 inputs, refer to Note 17 – Commitments and contingencies and Note 20 – Financial instruments.

The Company accounts for income taxes under ASC 740, “Income Taxes” (“ASC 740”).

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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.

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.

Foreign exchange differences arising on remeasurement 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.

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Non-controlling interests represent third-party equity ownership interests in the Company’s farming consolidated entity.

The Company evaluates its ownership, contractual and other interests in entities to determine if it has any variable interest in a VIE.

The Company evaluates its ownership, contractual and other interests in entities to determine if it has any variable interest in a VIE (“variable interest entities”).

These evaluations are complex and involve judgment and the use of estimates and assumptions based on available historical information, among other factors.

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Changes in consolidation status are applied prospectively.

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).

The Company has no VIEs at March 31, 2025 and December 31, 2024.

The amount of net loss attributable to Non-controlling interests is disclosed in the Unaudited Condensed Consolidated Statements of Income and Other Comprehensive Income / (Loss).

Discontinued Operations

As part of the Company’s stated strategy to pivot its focus to the global food supply chain sector, the Company spent 2024 fully engaged in the restructuring of Sadot Food Services.

By refranchising company-owned units and closing underperforming locations while growing Pokémoto through franchising, the Company continued its restructuring efforts with the goal of reducing annualized restaurant operating expenses and overhead while potentially increasing franchise royalty revenue at Pokémoto.

In early Q4 of 2024 the Company was able to close its last two corporate owned stores and reclassified the rest of Sadot Food Services to discontinued operations.

The amount of loss from discontinued operations is disclosed in the Unaudited Condensed Consolidated Statements of Income and Other Comprehensive Income / (Loss).

For details related to Discontinued operations, see Note 4 – Discontinued operations.

Recent Accounting Pronouncements

In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326):

Measurement of Credit Losses on Financial Instruments, as amended subsequently by ASUs 2018-19, 2019-04, 2019-05, 2019-10, 2019-11 and 2020-03.

The guidance in the ASUs requires that credit losses be reported using an expected losses model rather than the incurred losses model that is currently used.

The standard also establishes additional disclosures related to credit risks.

This standard is effective for fiscal years beginning after December 15, 2022.

The adoption of this guidance on January 1, 2023 did not have a material impact on the Company's Unaudited Condensed Consolidated Financial Statements and related disclosures.

In August 2020, the FASB issued Accounting Standards Update (“ASU”) 2020-06 Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity.

Among other changes, ASU 2020-06 removes the liability and equity separation model for convertible instruments with a cash conversion feature, and as a result, after adoption, entities will no longer separately present in equity an embedded conversion feature for such debt.

Similarly, the embedded conversion feature will no longer be amortized into income as interest expense over the life of the instrument.

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)

Sadot Group, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

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.

In November 2023, the FASB issued ASU 2023-07, Segment Reporting—Improvements to Reportable Segment Disclosures (Topic 280).

The standard requires incremental disclosures related to reportable segments, including disaggregated expense information and the title and position of the company's chief operating decision maker ("CODM"), as identified for purposes of segment determination.

The ASU is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024.

The ASU is effective for fiscal years beginning after December 15,

Sadot Group, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

2023, and interim periods within fiscal years beginning after December 15, 2024.

Entities must adopt the changes to the segment reporting guidance on a retrospective basis.

Early adoption is permitted.

The Company is currently evaluating the impact of this standard on its consolidated financial statements.

The adoption of this guidance on December 31, 2024 did not have a material impact on the Company's Consolidated Financial Statements and related disclosures.

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.

2 unchanged sentences

Retrospective application is permitted.

The adoption of this guidance on December 31, 2024 did not have a material impact on the Company's Consolidated Financial Statements and related disclosures.

In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40) ("ASU 2024-03").

The standard is intended to enhance transparency of income statement disclosures, primarily through additional disaggregation of relevant expense captions.

ASU 2024-03 is effective for fiscal years beginning after December 15, 2026, and interim reporting periods within fiscal years beginning after December 15, 2027.

Entities can adopt the change prospectively or retrospectively to any or all prior periods presented in the financial statements.

The Company is currently evaluating the impact of the standard on its consolidated financial statements.

Subsequent Events

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Assets Held For Sale

2023 Disposal groups held for sale

During the first quarter of 2024, the Company began actively marking the sale of Sadot food services and identifying it as a disposal group that meets the requirements of ASC 360-10.

Accordingly, it was classified as held for sale in the Company's Unaudited Condensed Consolidated Balance Sheets.

This current period classification resulted in the Group identifying a triggering event as it was more likely than not that these asset groups would be disposed of under ASC 350-20.

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.

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:

2024 Disposal group held for sale

After launching Sadot Agri-Foods, the Company made the decision to explore the option of selling a portion of our restaurant operations.

During the first quarter of 2024, the Company entered into an agreement with a brokerage firm to have the exclusive rights to offer and sell the Muscle Maker Grill and Pokémoto franchise business and potentially some of the corporate-owned restaurants.

Accordingly, the assets and liabilities related to the restaurant operations were classified as held for sale in the Company’s Consolidated Balance Sheets.

Throughout most of 2024, the Company considered retaining some Company owned stores due to location and potential training centers that posed challenges for sale.

However, in the fourth quarter of 2024, the Company closed its last two corporate owned stores, and have a sale pending for the franchise business.

Given the sale or pending sale of all of the restaurant operations as of December 31, 2024, we have deemed this to be a strategic shift in business structure as it will eliminate one of our two business segments, which triggered accounting for the restaurant operations as discontinued operations.

The Company performed an impairment test on the net assets of the restaurant operations as of March 31, 2025, noting the carrying amount was less than the fair value less cost to sell.

Sadot Group, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

September 30, 2024

Accounts receivable, net of allowance for doubtful accounts of $ 0.8 million

The following presents the major classes of assets and liabilities for the Sadot Food Services reporting unit held for sale:

March 31, 2025 December 31, 2024

Accounts receivable, net of allowance for doubtful accounts of $ 21.2 thousand and $ 0.2 million as of March 31, 2025 and December 31, 2024, respectively

Other current assets 45 52

Right to use assets —

Property and equipment, net 6 6

Goodwill 1,798 1,798

Intangible assets, net 2,715

Other non-current assets 182 189

Intangible assets, net 2,715 2,715

Assets held for sale 4,915 5,196

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Notes payable, non-current 531 542

Operating lease liability, non-current —

Deferred revenue, non-current 980 1,057

Liabilities held for sale 2,128 2,333

Sadot Food Services had the following pre-tax losses:

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

$’000 $’000 $’000 $’000

Sadot Food Services Net Loss Before Income Tax ( 665 ) ( 2,344 ) ( 1,713 ) ( 3,540 )

Sadot Food Services had the following pre-tax income and losses:

Three Months Ended March 31,

Sadot Food Services Net Income / (Loss) Before Income Tax 107 ( 1,090 )

Sadot Food Services was comprised of two fast casual restaurant concepts, Pokémoto and Muscle Maker Grill, as well as a subscription-based fresh prep meal concept, SuperFit Foods.

On August 1, 2024, SuperFit Foods was sold for $ 0.2 million with a minimal gain on the sale.

Sadot Group, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

Discontinued Operations

After launching Sadot Agri-Foods, the Company made the decision to explore the option of selling a portion of our restaurant operations.

Accordingly, the assets and liabilities related to the restaurant operations were classified as held for sale in the Company’s Consolidated Balance Sheets.

Throughout most of 2024, the Company considered retaining some Company owned stores due to location and potential training centers that posed challenges for sale.

However, in the fourth quarter of 2024, the Company closed its last two corporate owned stores, and have a sale pending for the franchise business.

The Company performed an impairment test on the net assets of the restaurant operations as of March 31, 2025, noting the carrying amount was less than the fair value less cost to sell.

The amount of loss from discontinued operations is disclosed in the Unaudited Consolidated Statements of Income and Other Comprehensive Income / (Loss).

Discontinued operations were as follows:

Three Months Ended March 31,

Revenues 394 1,429

Cost of goods sold — ( 1,331 )

Gross profit 394 98

Depreciation and amortization expenses — ( 189 )

Franchise advertising fund expenses ( 22 ) ( 15 )

Post-closing expenses 40 ( 19 )

Sales, general and administrative expenses ( 300 ) ( 703 )

Income / (loss) from discontinued operations 112 ( 828 )

Interest expense, net ( 5 ) ( 262 )

Income / (loss) from discontinued operations before income tax 107 ( 1,090 )

Income tax benefit / (expense) from discontinued operations — —

Income / (loss) from discontinued operations 107 ( 1,090 )

Allowance for Credit Losses on Accounts Receivable

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:

September 30, 2024 December 31, 2023

For the periods ended March 31, 2025 and December 31, 2024, a summary of the activity in the allowance for credit losses on accounts receivable appears below:

March 31, 2025 December 31, 2024

Balance at beginning of period 105 173

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Other Current Assets

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.

At September 30, 2024 and December 31, 2023, the Company’s other current assets consists of the following:

September 30, 2024 December 31, 2023

At March 31, 2025 and December 31, 2024, the Company’s other current assets consists of the following:

March 31, 2025 December 31, 2024

Prepaid expenses 1,877 1,911

Other receivables 80 82

Contract assets - current 93,520 47,180

Forward sales derivative 13,486 1,491

Derivative assets, current — 93,520

Derivative contracts — 18,602

Notes receivable, current 6,279 6,999

Deposit on farmland 5,852 5,852

Prepaid forward on carbon offsets — 6,424

Deposit on acquisition 2,837 —

Other Current Assets 16,925 126,966

Deposit on farmland consists of funds paid as a deposit with the intent to acquire farmland in Indonesia by Sadot Agri-Foods.

Deposit on acquisition consists of funds paid as a deposit related to a potential strategic transaction.

The deposits were made in accordance with the terms of a preliminary agreement and are refundable under certain conditions.

The transactions remains subject to customary closing conditions, including regulatory approvals and final documentation.

Other Non-Current Assets

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.

At September 30, 2024 and December 31, 2023, the Company’s other non-current assets consists of the following:

September 30, 2024 December 31, 2023

Security deposit 22 76

Notes receivable, non-current — 26

Contract assets, non-current — 46,340

At March 31, 2025 and December 31, 2024, the Company’s other non-current assets consist of the following:

March 31, 2025 December 31, 2024

Security deposits 22 23

Right to use assets 127 132

Other non-current assets 149 155

Sadot Group, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

Property and Equipment, Net

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.

As of September 30, 2024 and December 31, 2023, Property and equipment consist of the following:

September 30, 2024 December 31, 2023

As of March 31, 2025 and December 31, 2024, Property and equipment consist of the following:

March 31, 2025 December 31, 2024

Furniture and equipment 232 232

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Property and equipment, net 11,793 11,820

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.

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).

Sadot Group, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

Depreciation expense amounted to $ 27.0 thousand and $ 0.2 million for the three months ended March 31, 2025 and 2024, respectively.

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 nil and $ 0.1 million during the three months ended March 31, 2025 and 2024, respectively, in the Unaudited Condensed Consolidated Statement of Operations and Comprehensive Income / (Loss).

Goodwill and Other Intangible Assets, Net

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Intangible assets are amortized over useful lives ranging from 5 to 10 years.

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.

In 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.

Sadot Group, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

A summary of the intangible assets is presented below:

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intangible assets Amortization

expense Intangible

September 30,

expense Transfer to assets held for sale Intangible

2024 Intangible

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expense Transfer to assets held for sale Intangible

September 30,

$’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000

Trademark Muscle Maker Grill 670 ( 419 ) ( 251 ) — — — — — —

Franchise Agreements Muscle Maker Grill 136 ( 116 ) ( 20 ) — — — — — —

Trademark SuperFit 29 ( 22 ) ( 7 ) — — — — — —

Domain Name SuperFit 81 ( 62 ) ( 19 ) — — — — — —

Customer List SuperFit 90 ( 70 ) ( 20 ) — — — — — —

Proprietary Recipes SuperFit 103 ( 79 ) ( 24 ) — — — — — —

Non-Compete Agreement SuperFit 107 ( 42 ) ( 65 ) — — — — — —

Trademark Pokemoto 118 — ( 26 ) 92 83 — ( 9 ) ( 74 ) —

Franchisee License Pokemoto 2,322 — ( 207 ) 2,115 2,045 — ( 69 ) ( 1,976 ) —

Proprietary Recipes Pokemoto 867 — ( 121 ) 746 705 — ( 40 ) ( 665 ) —

Non-Compete Agreement Pokemoto 88 — ( 88 ) — — — — — —

Trademark Pokémoto 83 — ( 9 ) ( 74 ) — — — — — —

Franchisee License Pokémoto 2,045 — ( 69 ) ( 1,976 ) — — — — — —

Proprietary Recipes Pokémoto 705 — ( 40 ) ( 665 ) — — — — — —

2,833 — ( 118 ) ( 2,715 ) — — — — — —

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.

Amortization expense related to intangible assets was nil and $ 0.1 million for the three months ended March 31, 2025 and 2024, respectively.

A summary of the goodwill assets is presented below:

Muscle Maker Grill Pokemoto SuperFit Food Total

Muscle Maker Grill Pokémoto SuperFit Food Total

$’000 $’000 $’000 $’000

1 unchanged sentence

Impairment of goodwill — ( 1,798 ) — ( 1,798 )

Goodwill, net at September 30, 2023 — 1,798 — 1,798

Goodwill, net at March 31, 2024 — — — —

Goodwill, net at December 31, 2024 — — — —

Transfer to assets held for sale — — — —

Goodwill, net at September 30, 2024 — — — —

Goodwill, net at March 31, 2025 — — — —

Sadot Group, Inc.

1 unchanged sentence

Accounts Payables and Accrued Expenses

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:

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

Accounts payable 3,365 2,187

4 unchanged sentences

Accounts payable commodities 29,312 24,833

Accrued purchases — 17

Sales taxes payable 2 2

10 unchanged sentences

Accordingly, as may otherwise be limited by Yorkville’s 4.99 % beneficial ownership limitation, assuming the Company submits an Advance requiring Yorkville to provide $ 100,000 in funding and assuming an applicable VWAP of $ 11.00 and, in turn, a purchase price of $ 10.67 ( 97 % of the VWAP), the Company would be required to issue 9,372 shares of common stock and Yorkville would receive a profit of approximately $ 0.3201 per share, or approximately $ 2,999.98 , if it sold all of such shares at $ 11.00 per share.

Sadot Group, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

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.

The purchase price for the Pre-Paid Advance is 94.0 % of the principal amount of the Pre-Paid Advance.

The purchase price for the Pre-Paid Advance is 94.0 % of the principal

Sadot Group, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

amount of the Pre-Paid Advance.

Interest shall accrue on the outstanding balance of any Pre-Paid Advance at an annual rate equal to 6.0 %, subject to an increase to 18 % upon an event of default as described in the Convertible Notes.

5 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”).

No triggering event occurred as of September 30, 2024.

As of September 30, 2024, 607,527 shares of common stock have been converted leaving an aggregate principal balance remaining of $ 0.8 million.

The Note was paid in full in 2024.

Factoring agreement

As of March 31, 2025, $ 3.8 million of the Company’s total $ 10.9 million in notes payable relates to a factoring arrangement accounted for as a secured borrowing.

Under the arrangement, accounts receivables with a carrying value of $ 4.1 million were pledged as collateral.

The Company remains exposed to credit risk on the pledged receivables.

Notes Payable

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.

As of September 30, 2024, the Company had an aggregate amount of $ 2.8 million in notes payable, net.

The notes had interest rates ranging between 6.00 % - 25.80 % per annum, due on various dates through March 2025.

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.

The maturities of notes payable as of September 30, 2024, are as follows:

The Company repaid a total amount of $ 1.5 million and $ 4.3 million during the three months ended March 31, 2025 and 2024, respectively, of the notes payable.

The company entered into new loans in the amount of $ 4.6 million and $ 1.5 million for the three months ended March 31, 2025 and 2024, respectively.

As of March 31, 2025, the Company had an aggregate amount of $ 10.9 million in notes payable, net.

The notes had interest rates ranges between 3.75 % - 39.00 % per annum, due on various dates through December 2025.

As of March 31, 2025, the Company has outstanding short-term secured debt in the form of notes payable totaling $ 1.8 million, which is included in the $ 10.9 million in notes payable, net.

The effective interest rate on the short-term secured debt ranges between 21.20 % - 39.00 %.

The maturities of notes payable as of March 31, 2025, are as follows:

Principal Amount

10 unchanged sentences

Notes to the Condensed Consolidated Financial Statements (Unaudited)

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.

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.

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 total lease cost associated with right of use assets and operating lease liabilities was $ 14.0 thousand and nil for the three months ended March 31, 2025 and 2024, respectively, and has been recorded in the Unaudited Condensed Consolidated Statement of Operations and Other Comprehensive Income / (Loss) as Cost of goods sold.

Right to use asset and operating lease liabilities decreased due to the refranchising, selling and closure of all of our corporate owned locations by March 31, 2025.

The assets and liabilities related to the Company’s leases were as follows:

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

Total lease assets 127 132

5 unchanged sentences

Operating leases – non-current 105 111

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

$’000 $’000 $’000

The table below presents the future minimum lease payments under the noncancellable operating leases as of March 31, 2025:

04/01/2025-3/31/2026 45

3 unchanged sentences

04/01/2029-03/31/2030 —

Thereafter — — —

Total lease payments 180

1 unchanged sentence

Present value of lease liabilities 129

Sadot Group, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

The Company’s lease term and discount rates were as follows:

As of September 30, 2024

As of March 31, 2025

Weighted-average remaining lease term (in years)

2 unchanged sentences

Operating leases 18.0 %

Sadot Group, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

Deferred Revenue

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:

September 30, 2024 December 31, 2023

March 31, 2025 December 31, 2024

Deferred revenues, net 74 2,251

1 unchanged sentence

Deferred revenues, non-current — —

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.

Deferred revenue related to deferred franchise fees were nil and $ 1.4 million, as of September 30, 2024 and December 31, 2023, respectively.

Deferred revenue related to commodity forward sales contracts and prepayments on future trades were $ 0.1 million and $ 2.3 million, as of March 31, 2025 and December 31, 2024, respectively.

Other Current Liabilities

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:

September 30, 2024 December 31, 2023

Gift card liability — 13

Co-op advertising fund liability — 114

Marketing development brand liability — 68

Advertising fund liability — 29

Derivative liability 189 —

Contract liabilities, current 92,094 46,046

92,283 46,270

Sadot Group, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

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:

September 30, 2024 December 31, 2023

Deferred tax assets:

Net operating loss carryforwards 13,401 11,890

Receivable allowance 163 37

Stock-based compensation 115 20

Intangible assets 619 727

163(j) adjustment 714 100

Property and equipment 43 —

Accrued expenses — 106

Capitalized costs 8 4

Deferred revenues 167 310

Leases 30 301

Gross deferred tax asset 15,260 13,495

Deferred tax liabilities:

Other liabilities ( 4 ) —

Property and equipment — ( 60 )

Leases ( 29 ) ( 274 )

Unrealized gains ( 2,818 ) ( 317 )

Gross deferred tax liabilities ( 2,851 ) ( 651 )

Net deferred tax assets 12,409 12,844

Valuation allowance ( 12,409 ) ( 12,844 )

Net deferred tax asset, net of valuation allowance — —

March 31, 2025 December 31, 2024

Derivative contracts 115 60

Operating lease liability, current 24 23

Derivative liability, current

Other Non-Current Liabilities

Other non-current liabilities consist of the following:

March 31, 2025 December 31, 2024

Operating lease liability, non-current 105 111

The income tax expense for the periods shown consist of the following:

Nine Months Ended September 30,

State and local:

Current ( 9 ) ( 18 )

Change in valuation allowance — —

Three Months Ended March 31,

Income tax expense — 1

1 unchanged sentence

Notes to the Condensed Consolidated Financial Statements (Unaudited)

A reconciliation of the statutory federal income tax rate to the Company’s effective tax rate for the periods shown, are as follows:

September 30, 2024 December 31, 2023

Federal income tax benefit at statutory rate 21.0 % 21.0 %

State income tax benefit, net of federal impact — % 1.1 %

Permanent differences 0.5 % ( 0.3 ) %

Return to provision adjustments 3.6 % 0.5 %

Warrant modification expense — % ( 2.5 ) %

Fair value gain/loss on share issuance ( 18.6 ) % 3.6 %

Other 2.4 % — %

Change in valuation allowance ( 9.7 ) % ( 23.2 ) %

The Company’s effective tax rate for the periods shown, are as follows:

March 31, 2025 December 31, 2024

Effective income tax rate — % 0.1 %

The Company has filing obligations in what it considers its U.S.

major tax jurisdictions as follows:

Connecticut, Kansas, Florida, Texas, Virginia, New York State and New York City.

The earliest year that the Company is subject to examination is the year ended December 31, 2015.

The Company has approximately $ 58.2 million of Federal and State Net operating loss (“NOLs”) available to offset future taxable income.

The net operating loss carryforwards generated prior to 2018, if not utilized, will expire from 2035 to 2037 for federal and state purposes.

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.

Utilization of the net operating loss carryforwards and credits may be subject to a substantial annual limitation due to the ownership change limitations provided by Section 382 and Section 383 of the Internal Revenue Code of 1986, as amended, and similar state provisions.

Generally, in addition to certain entity reorganizations, the limitation applies when one or more “5 percent stockholders” increase their ownership, in the aggregate, by more than 50 percentage points over a 36-month time period or beginning the day after the most recent ownership change, if shorter.

In accordance with ASC 740-270, “Income Taxes – Interim Reporting”, the Company is required at the end of each interim period to determine the best estimate of its annual effective tax rate and apply that rate to year-to-date ordinary income or loss.

The resulting tax expense (or benefit) is adjusted for the tax effect of specific events, if any, required to be discretely recognized in the interim period as they occur.

The Company recorded no income tax expense for the three months ended March 31, 2025, resulting in an effective tax rate of 0 %.

The 0 % effective tax rate for the current period is primarily attributable to the continued utilization of net operating loss carryforwards.

The deferred tax asset ("DTA") related to these NOLs is subject to a full valuation allowance which was previously recorded.

As a result, although there is current period income, the corresponding income tax expense is offset by a reduction in the valuation allowance, resulting in no net income tax expense.

The Company continues to maintain a full valuation allowance against its deferred tax assets as it has not yet concluded that it is more likely than not that the deferred tax assets will be realized

ASC Topic 740 prescribes a recognition threshold and a measurement attribute for the financial statement recognition and measurement of tax positions taken or expected to be taken in a corporate tax return.

For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities.

Differences between tax positions taken or expected to be taken in a tax return and the benefit recognized and measured pursuant to the interpretation are referred to as unrecognized benefits.

A liability is recognized (or amount of net operating loss carryforward or amount of tax refundable is reduced) for an unrecognized tax benefit because it represents an enterprise’s potential future obligation to the taxing authority for a tax position that was not recognized as a result of applying the provisions of ASC Topic 740.

The Company believes there are no uncertain tax positions in prior year tax filings and therefore it has not recorded a liability for unrecognized tax benefits.

In accordance with ASC Topic 740, interest costs related to unrecognized tax benefits are required to be calculated (if applicable) and would be classified as “Interest expense, net”.

Penalties if incurred would be recognized as a component of “Selling, general and administrative” expenses.

The Company files corporate income tax returns in the United States (federal) and in various state and local jurisdictions.

In most instances, the Company is no longer subject to federal, state and local income tax examinations by tax authorities for years prior to 2015.

Commitments and Contingencies

Forward Purchase and Sales Contracts

On September 12, 2023, the Company through Sadot Agri-Foods, entered into a forward purchase contract titled the Verified Emissions Reduction Purchase Agreement (“VERPA”) for the acquisition of Verified Carbon Units (“VCUs”) generated by a conservation project along the Riau coastline in Indonesia (“conservation project”).

Under the VERPA, Sadot Agri-Foods will acquire 180,000 VCUs between 2025 and 2027 as issued.

Delivery of VCUs to Sadot Agri-Foods is expected within 14 days from credit issuance annually, where such delivery will occur no later than December of each respective year.

The acquisition price for these VCUs is $ 35.69 per VCU, or $ 6.4 million in the aggregate, which was paid on September 23, 2023.

The aggregate purchase price paid of $ 6.4 million was recorded on the balance sheet within the Gain on fair value remeasurement account.

On September 13, 2023, the Company through Sadot Agri-Foods, entered into a separate forward sales agreement pursuant to which the purchaser agreed to acquire 180,000 VCUs between 2025 and 2026 for an acquisition price of $ 44.62 per VCU, or $ 8.0 million.

The VCUs are expected to be generated as part of the conservation project.

The VCUs would be delivered within 14 days from credit issuance annually, where such delivery will occur no later than December of each respective year.

Payment for these VCUs would not be required until 2025 at the earliest, within 10 days of VCU issuance.

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).

This contract was determined to be a

Sadot Group, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

derivative in accordance with ASC 815.

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.

2 unchanged sentences

This contract was determined to be a derivative in accordance with ASC 815.

On March 20, 2025, the Company settled this contract for a realized gain of $ 10.5 million, of which $ 9.3 million were recorded as unrealized gains in prior periods, with a total impact of $ 1.2 million in the current quarter.

On December 6, 2023, the Company through Sadot Agri-Foods, entered into a forward sale contract for the sale of 70,000 Metric Tons (“MTs”) of soybeans.

2 unchanged sentences

This contract was determined to be a derivative in accordance with ASC 815.

On March 20, 2025, the Company settled this contract for a realized gain of $ 11.1 million, of which $ 9.3 million were recorded as unrealized gains in prior periods, with a total impact of $ 1.8 million in the current quarter.

Refer to Note 2 – Significant accounting policies, Note 19 – Fair value measurement and Note 20 – Financial instruments for additional information regarding the Derivative liability.

Sadot Group, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

Consulting Agreements

On November 14, 2022 (the “Effective Date”), the Company, Sadot LLC and Aggia LLC FC, a company formed under the laws of United Arab Emirates (“Aggia”) entered into a Services Agreement (the “Services Agreement”) whereby Sadot LLC engaged Aggia to provide certain advisory services to Sadot Agri-Food for creating, acquiring and managing Sadot Agri Food’s business of wholesaling food and engaging in the purchase and sale of physical food commodities.

On November 14, 2022 (the “Effective Date”), the Company, Sadot LLC and Aggia LLC FC, a company formed under the laws of United Arab Emirates (“Aggia”) entered into a Services Agreement (the “Services Agreement”) whereby Sadot LLC engaged Aggia to provide certain advisory services to Sadot Agri-Food for creating, acquiring and managing Sadot Agri Foods' business of wholesaling food and engaging in the purchase and sale of physical food commodities.

As consideration for Aggia providing the services to Sadot Agri-Food, the Company agreed to issue shares of common stock of the Company, par value $ 0.0001 per share, to Aggia subject to Sadot Agri-Food generating net income measured on a quarterly basis at per share price of $ 15.6250 , subject to equitable adjustments for any combinations or splits of the common stock occurring following the Effective Date.

14 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.

Sadot Group, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

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.

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.

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.

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.

Master Franchise Agreement

On October 25, 2021, Muscle Maker Development International LLC (“MMDI”), a wholly-owned subsidiary of the Company, entered into a Master Franchise Agreement (the “Master Franchise Agreement”) with Almatrouk Catering Company – OPC (“ACC”) providing ACC with the right to grant franchises for the development of 40 “Muscle Maker Grill” restaurants through December 31, 2030 (the “Term”) in the Kingdom of Saudi Arabia (“KSA”).

Under the Master Franchise Agreement, MMDI has granted to ACC an exclusive right to establish and operate Muscle Maker restaurants in the KSA.

MMDI will not own or operate restaurants in KSA, grant franchises for the restaurants in KSA, or grant Master Franchise Rights for the restaurants to other persons within the KSA.

ACC will be solely responsible for the development, sales, marketing, operations, distribution and training of all franchise locations sold in the KSA.

ACC is required to pay MMDI $ 0.2 million pursuant to the Master Franchise Agreement upon the occurrence of various events.

ACC is required to pay MMDI $ 20.0 thousand upon the execution of each franchise agreement for each individual restaurant and a monthly royalty fee of $ 1.0 thousand for each restaurant.

Further, ACC is to adhere to the agreed upon development schedule as outlined in the master franchise agreement.

An initial $ 20.0 thousand deposit was paid on the agreement.

ACC has not performed against this agreement.

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.

Additionally, for the three months ended March 31, 2025, the Company reimbursed Aggia for all operating costs related to Sadot Agri-Foods' of $ 0.8 million.

For the three months ended March 31, 2024, operating costs related to Sadot Agri-Foods' of $ 1.1 million.

The Company had accrued a sales tax liability for approximately $ 2.0 thousand and $ 2.0 thousand as of March 31, 2025, and December 31, 2024, 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.

Litigations, Claims and Assessments

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.

As of September 30, 2024 and December 31, 2023, the Company has accrued for the liability in accounts payable and accrued expenses.

On March 21, 2025, Cropit Farming Limited ("Cropit") commenced legal proceedings against our subsidiary, Sadot LLC, in the Commercial Registry of the High Court of Zambia.

The complaint alleges that certain agreements between the

Sadot Group, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

parties are invalid under Zambian law, and seeks rescission of these agreements, return of assets, and damages of approximately $ 6.7 million USD and 0.2 million Zambian Kwacha ($ 6.0 thousand USD as of March 31, 2025).

Sadot LLC has filed a response denying all allegations and has asserted substantial counterclaims.

The counterclaims seek a declaration that the agreements are valid and enforceable, specific performance of the agreements, injunctive relief to protect contractual rights, damages for breach of contract, reputational damages, damages for loss of use of land, punitive damages of approximately 5.0 million Zambian Kwacha ($ 0.2 million USD as of March 31, 2025), interest, and costs.

The matter was scheduled for a Status Conference on May 9, 2025, which has been adjourned to June 13, 2025.

Sadot LLC is preparing to file an application to stay proceedings and refer the matter to arbitration pursuant to the dispute resolution mechanism in the parties' agreement, as well as seeking injunctive relief to protect its interests in the joint venture.

Management, in consultation with legal counsel, believes Sadot LLC has reasonably favorable prospects of success with respect to this matter and intends to vigorously defend against the claims while pursuing its counterclaims.

Based on current information, management does not believe that the ultimate resolution of this matter will have a material adverse effect on the Company's financial position or results of operations.

However, litigation is inherently unpredictable, and we cannot provide assurances regarding the outcome.

The Company has not recorded any material liabilities in connection with this matter as a loss is neither probable nor reasonably estimable at this time.

The Company will continue to evaluate this matter and will establish reserves if and when appropriate.

On November 7, 2024, Lombard Trading International Corp.

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.:

2024-020971-CA-01).

The Amended Complaint alleges unjust enrichment, conversion, fraud, conspiracy and civil theft related to a commodities transaction.

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.

The Company has not received the goods and has not received the Bills of Lading that were contractually required for the transaction to be completed.

The Company denies these allegations and intends to vigorously defend against the claims.

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.

Therefore, no contingent liability has been recorded as of March 31, 2025.

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.

Sadot Group, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

Employment Agreements

On November 16, 2022, the Company entered into an Executive Employment Agreement with Michael Roper (the “Roper Agreement”), which replaced his prior employment agreement.

Pursuant to the Roper Agreement, Mr.

Roper will continue to be employed as Chief Executive Officer of the Company on an at-will-basis.

During the term of the Roper Agreement, Mr.

Roper is entitled to a base salary at the annualized rate of $ 0.4 million.

Roper will be eligible for a discretionary performance bonus to be determined by the Board annually.

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.

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.

On March 21, 2023, the Company entered into an Executive Employment Agreement with Jennifer Black (the “Black Agreement”), which replaced her prior employment agreement.

Pursuant to the Black Agreement, Ms.

Black will continue to be employed as Chief Financial Officer of the Company on an at-will-basis.

During the term of the Black Agreement, Ms.

Black is entitled to a base salary at the annualized rate of $ 0.3 million.

Black will be eligible for a discretionary performance bonus up to 50 % of her annual salary.

Black 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.

Black 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.

Black is terminated by the Company for any reason other than cause or resigns for a good reason, Ms.

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.

Pursuant to the Miller Agreement, Mr.

Miller will continue to be employed as Chief Operating Officer of the Company on an at-will-basis.

During the term of the Miller Agreement, Mr.

Miller is entitled to a base salary at the annualized rate of $ 0.3 million.

Miller will be eligible for a discretionary performance bonus up to 75 % of his annual salary.

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.

Miller is terminated by the Company for any reason other than cause or resigns for a good reason, Mr.

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.

On November 16, 2022, the Company entered into an Executive Employment Agreement with Kevin Mohan (the “Mohan Agreement”), which replaced his prior employment agreement.

Pursuant to the Mohan Agreement, Mr.

Mohan will continue to be employed as Chief Investment Officer of the Company on an at-will-basis.

During the term of the Employment Agreement, Mr.

Mohan is entitled to a base salary at the annualized rate of $ 0.2 million.

Mohan will be eligible for a discretionary performance bonus up to 75 % of his annual salary.

Mohan 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.

Mohan 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.

Mohan is terminated by the Company for any reason other than cause or resigns for a good reason, Mr.

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..

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.

Sadot Group, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

continue to be employed as Chief Marketing Officer of the Company on an at-will-basis.

During the term of the Infante Agreement, Ms.

Infante is entitled to a base salary at the annualized rate of $ 0.2 million.

Infante will be eligible for a discretionary performance bonus up to 25 % of her annual salary.

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.

Infante is terminated by the Company for any reason other than cause or resigns for a good reason, Ms.

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.

NASDAQ Notice

4 unchanged sentences

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.

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.

To qualify, the Company was required to meet the continued listing requirement for market value of the Company's publicly 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.

Sadot Group, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

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.

5 unchanged sentences

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.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

Reportable Operating Segments

See Note 1 – Business organization and nature of operations for descriptions of our operating segments.

The following table sets forth the results of operations for the relevant segments for the three and nine months ended September 30, 2024:

For the Three Months Ended September 30, 2024

The Company’s reportable segments are determined based on the management approach, consistent with the way the Chief Operating Decision Maker (CODM) evaluates financial performance and allocates resources.

The CODM, identified as the Chief Executive Officer, regularly reviews discrete financial information for the Sadot Food Services and Sadot Agri-Foods segments to assess performance and make operational decisions.

The following table sets forth the results of operations for the relevant segments for the three months ended March 31, 2025:

For the Three Months Ended March 31, 2025

Sadot food service Sadot agri-foods Corporate adj.

2 unchanged sentences

Commodity sales — 132,168 — 132,168

Company restaurant sales, net of discounts 479 — — 479

Franchise royalties and fees 321 — — 321

Franchise advertising fund contributions 12 — — 12

Other revenues 16 — — 16

Cost of goods sold — ( 126,156 ) — ( 126,156 )

1 unchanged sentence

Depreciation and amortization expenses — ( 26 ) ( 1 ) ( 27 )

Franchise advertising fund expenses ( 12 ) — — ( 12 )

Post-closing expenses ( 91 ) — — ( 91 )

Stock-based expenses — — ( 1,428 ) ( 1,428 )

1 unchanged sentence

Income / (loss) from operations — 4,201 ( 2,725 ) 1,476

Other income — — — —

Interest income / (expense), net — ( 754 ) ( 787 ) ( 1,541 )

Change in fair value of stock-based compensation — — 778 778

Gain on fair value remeasurement — 5,461 — 5,461

Gain on sale of trading securities — — — —

Income / (Loss) Before Income Tax ( 665 ) 3,869 ( 2,107 ) 1,097

Income tax expense — — ( 3 ) ( 3 )

Net income / (loss) ( 665 ) 3,869 ( 2,110 ) 1,094

Total assets 5,431 164,638 958 171,027

Sadot Group, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

For the Nine Months Ended September 30, 2024

Sadot food service Sadot agri-foods Corporate adj.

Total segments

$’000 $’000 $’000 $’000

Commodity sales — 480,706 — 480,706

Company restaurant sales, net of discounts 2,628 — — 2,628

Franchise royalties and fees 1,319 — — 1,319

Franchise advertising fund contributions 40 — — 40

Other revenues 16 — — 16

Cost of goods sold ( 3,113 ) ( 476,961 ) — ( 480,074 )

Gross profit 890 3,745 — 4,635

Depreciation and amortization expenses ( 189 ) ( 230 ) ( 2 ) ( 421 )

Franchise advertising fund expenses ( 40 ) — — ( 40 )

Post-closing expenses ( 120 ) — — ( 120 )

Stock-based expenses — — ( 4,430 ) ( 4,430 )

Sales, general and administrative expenses ( 2,252 ) ( 4,052 ) ( 2,466 ) ( 8,770 )

Loss from operations ( 1,711 ) ( 537 ) ( 6,898 ) ( 9,146 )

Other income 19 — — 19

Interest income / (expense), net ( 21 ) ( 1,451 ) ( 1,497 ) ( 2,969 )

Change in fair value of stock-based compensation — — 2,691 2,691

Gain on fair value remeasurement — 11,995 — 11,995

Gain on sale of trading securities — 518 — 518

Income / (Loss) Before Income Tax ( 1,713 ) 10,525 ( 5,704 ) 3,108

Income / (loss) for continuing operations before income tax — 3,447 ( 2,734 ) 713

Income tax expense — — — —

Net income / (loss) for continuing operations — 3,447 ( 2,734 ) 713

Income for discontinued operations, net of income tax 107 — — 107

Net income / (loss) 107 3,447 ( 2,734 ) 820

Total assets 5,431 164,638 958 171,027

Sadot Group, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

The following table sets forth the results of operations for the relevant segments for the three and nine months ended September 30, 2023:

For the Three Months Ended September 30, 2023

Sadot food service Sadot agri-foods Corporate adj.

Total segments

Net loss attributable to non-controlling interest — 118 — 118

Net income / (loss) attributable to Sadot Group Inc.

107 3,565 ( 2,734 ) 938

Commodity sales — 179,975 — 179,975

Company restaurant sales, net of discounts 1,937 — — 1,937

Franchise royalties and fees 245 — — 245

Franchise advertising fund contributions 16 — — 16

Other revenues — — — —

Cost of goods sold ( 2,167 ) ( 177,101 ) — ( 179,268 )

Gross profit 31 2,874 — 2,905

Impairment of goodwill ( 828 ) — — ( 828 )

Impairment of intangible assets ( 810 ) — — ( 810 )

Depreciation and amortization expenses ( 382 ) ( 61 ) — ( 443 )

Franchise advertising fund expenses ( 16 ) — — ( 16 )

Pre-opening expenses — ( 335 ) — ( 335 )

Post-closing expenses ( 60 ) — — ( 60 )

Stock-based expenses — — ( 1,075 ) ( 1,075 )

Sales, general and administrative expenses ( 278 ) ( 553 ) ( 2,479 ) ( 3,310 )

Income / (loss) from operations ( 2,343 ) 1,925 ( 3,554 ) ( 3,972 )

Other income 1 — — 1

Interest expense, net ( 2 ) ( 5 ) ( 294 ) ( 301 )

Change in fair value of stock-based compensation — — 297 297

Warrant modification expense — — ( 958 ) ( 958 )

Loss on fair value remeasurement — ( 349 ) — ( 349 )

Income / (Loss) Before Income Tax ( 2,344 ) 1,571 ( 4,509 ) ( 5,282 )

Income tax expense — — ( 13 ) ( 13 )

Net income / (loss) ( 2,344 ) 1,571 ( 4,522 ) ( 5,295 )

Total assets 4,915 77,001 1,828 83,744

1 unchanged sentence

Notes to the Condensed Consolidated Financial Statements (Unaudited)

For the Nine Months Ended September 30, 2023

The following table sets forth the results of operations for the relevant segments for the three months ended March 31, 2024:

For the Three Months Ended March 31, 2024

Sadot food service Sadot agri-foods Corporate adj.

2 unchanged sentences

Commodity sales — 106,507 — 106,507

Company restaurant sales, net of discounts 6,725 — — 6,725

Franchise royalties and fees 767 — — 767

Franchise advertising fund contributions 52 — — 52

Other revenues 13 — — 13

Cost of goods sold — ( 103,697 ) — ( 103,697 )

Gross profit — 2,810 — 2,810

Impairment of goodwill ( 828 ) — — ( 828 )

Impairment of intangible assets ( 810 ) — — ( 810 )

Depreciation and amortization expenses — ( 91 ) — ( 91 )

Franchise advertising fund expenses ( 52 ) — — ( 52 )

Pre-opening expenses ( 36 ) ( 335 ) — ( 371 )

Post-closing expenses ( 172 ) — ( 1 ) ( 173 )

Stock-based expenses — — ( 796 ) ( 796 )

1 unchanged sentence

Income / (loss) from operations — 1,988 ( 1,458 ) 530

Other income 1 — 251 252

Interest income / (expense), net — ( 407 ) 179 ( 228 )

Change in fair value of stock-based compensation — — 476 476

Warrant modification expense — — ( 958 ) ( 958 )

Loss on fair value remeasurement — ( 349 ) — ( 349 )

Income / (Loss) Before Income Tax ( 3,540 ) 8,480 ( 11,093 ) ( 6,153 )

Income / (loss) for continuing operations before income tax — 1,581 ( 803 ) 778

Income tax expense — — ( 1 ) ( 1 )

Net income / (loss) for continuing operations — 1,581 ( 804 ) 777

Loss for discontinued operations, net of income tax ( 1,090 ) — — ( 1,090 )

Net income / (loss) ( 1,090 ) 1,581 ( 804 ) ( 313 )

Net loss attributable to non-controlling interest — 48 — 48

Net income / (loss) attributable to Sadot Group Inc.

( 1,090 ) 1,629 ( 804 ) ( 265 )

Total assets 6,950 142,673 904 150,527

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.

With the creation of our Sadot LLC subsidiary in late 2022, we began to transform from a U.S.-centric restaurant business into a global, food-focused organization with two distinct segments.

As a result, we have reevaluated and changed our operating segments late in 2023 to align with our 2 distinct segments.

Previously we split out Muscle Maker Grill, Pokemoto, and SuperFit Foods as their own restaurant operating segments.

With the transformation of our business into a global, food-focused organization, we operate the business in 2 distinct business segments Sadot Agri-Foods and Sadot Food Service.

In 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, Note 3 – Assets held for sale and Note 4 – Discontinued operations.

The Company will continue to evaluate its operating segments and update as necessary.

Fair Value Measurement

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)

September 30, 2024

The following tables presents information about the Company's assets and liabilities that are measured at fair value on a recurring basis at March 31, 2025 and December 31, 2024 and indicates the fair value hierarchy of the valuation inputs the Company utilized to determine such fair value.

March 31, 2025

Level 1 Level 2 Level 3 Total

$’000 $’000 $’000 $’000

Financial assets:

Forward sales derivative — 13,486 — 13,486

— 13,486 — 13,486

Financial liabilities:

Contract liability — 92,094 — 92,094

Derivative liability — 188 — 188

— 92,282 — 92,282

Derivative contracts — 115 — 115

Sadot Group, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

December 31, 2024

2 unchanged sentences

Financial assets:

Forward sales derivative — 1,491 — 1,491

Derivative asset — 93,520 — 93,520

Derivative contracts — 18,602 — 18,602

— 112,122 — 112,122

Financial liabilities:

Contract liability — 92,094 — 92,094

Derivative liability — 92,094 — 92,094

Derivative contracts — 60 — 60

— 92,154 — 92,154

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.

There were no transfers between fair value levels during the three months ended March 31, 2025.

See Note 17 – Commitments and contingencies and Note 20 – Financial instruments for details related to the Derivative liability being fair valued using Level 2 inputs.

Derivative Liability

The Derivative liability is primarily related to open hedging positions as of September 30, 2024.

The Derivative liability is primarily related to open hedging positions as of March 31, 2025.

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.

Please refer to Please refer to Note 2 – Significant accounting policies for additional information on ASC 815 leveling.

Please refer to Note 2 – Significant accounting policies for additional information on ASC 815 leveling.

Financial Instruments

Concentration of Credit Risk

Commodity Price Risk

The Company uses a combination of purchase orders and various long and short-term supply arrangements in connection with the purchase of corn, soybean and soybean products including certain commodities and agricultural products.

We also enter into commodity futures, options and swap contracts to reduce the volatility of price fluctuations of wheat, soybean and corn.

Commodity futures, options and swap contracts are either designated as cash-flow hedging instruments or are undesignated.

Inherent in our business is the risk of matching the timing of our purchase and sales contracts.

The prices of food and feed commodities (e.g., soybeans, wheat, corn, etc.) and carbon offset units we buy and sell are based on a constantly moving terminal market price determined by various exchanges (e.g., CME, Chicago Board of Trade ("CBOT") and Dalian Commodity Exchange ("DCE"), etc.).

Were we not to hedge such exposures, we could be exposed to significant losses due to the continually changing commodity prices.

We use commodity futures contracts to manage our exposure to this commodity price risk.

It is generally our policy to hedge such risks to the extent practicable.

We enter into hedges to limit our exposure to volatile price fluctuations that we believe would impact our gross margins on firm purchase and sales commitments.

As an example, if we enter into fixed price contracts with our suppliers and variable priced sales contracts with our customers, we will generally enter into a futures contract to sell the commodity for future delivery in the month when we expect the commodity price to be fixed according to the sales contract terms.

We repurchase this position once the pricing has been fixed with our customer.

If the underlying commodity price increases, we suffer a hedging loss and have an unrealized loss on derivative contracts, but the sales price to the customer is based on a higher market price and offsets the loss.

Conversely, if the commodity price decreases, we have a hedging gain and recognize an unrealized gain on derivative contracts, but the sales price to the customer is based on the lower market price and offsets the gain.

In accordance with FASB ASC 815, Derivatives and Hedging, we designate these derivative contracts as fair value hedges and recognize them on our balance sheet at fair value.

We also recognize offsetting changes in the fair value of the related firm purchase and sales commitment to which the hedge is attributable in earnings upon revenue recognition, which occurs at the time of delivery to our customers.

The potential for losses related to our hedging activities, given our hedging methodology, arises from the exchanges for our commodity hedges or customer defaults.

In the event of a customer default, we might be forced to sell the commodities in the open market and absorb losses for the commodities.

Our results of operations could be materially impacted by any counterparty or customer default, as we might not be able to collect money owed to us and/or our hedge might effectively be cancelled.

Sadot Group, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

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.

The change in fair value on undesignated instruments is recorded through earnings in Cost of goods sold.

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.

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.

Refer to Note 15 – Commitments and contingencies, for a more detailed discussion of the transactions.

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.

We use hedges for no purpose other than to avoid exposure to changes in commodity prices between when we buy a shipment of commodities from a supplier and when we deliver it to a customer.

Our derivatives are not for purposes of trading in the futures market.

We earn our gross profit margin through our business operations and not from the movement of commodity prices.

The Company’s assets and liabilities related to unrealized gains or losses on fair value hedges measured at fair value at March 31, 2025 and December 31, 2024 are as follows:

Derivatives designated as fair value hedges Balance Sheet Location March 31, 2025 December 31, 2024

Asset (liability) derivatives:

Derivative contracts Other current liabilities ( 115 ) ( 60 )

Total ( 115 ) ( 60 )

The table below summarizes the realized gain or (loss) on the Company’s derivative instruments that are designated as fair value hedges and their location in the Unaudited Condensed Consolidated Statement of Operations and Other Comprehensive Income / (Loss):

Three Months Ended March 31,

Derivatives in hedging relationships Location of Gain / (Loss) Recognized 2025 2024

Derivative contracts Cost of goods sold ( 136 ) ( 11 )

Total ( 136 ) ( 11 )

From time to time we may enter into forward sales contracts that do not meet the definition or qualify for hedge accounting.

Forward sales contracts are derivatives that were entered into to sell goods at a later date at a fixed or determinable price for a specific period.

Forward sales contracts are recognized on the balance sheet at the value of the contract and the difference in the fair value and derivative liability is recorded as an unrealized gain on derivative contracts or unrealized loss on derivative contracts.

If the underlying commodity price increases, we suffer a mark to market loss and have a derivative liability.

Conversely, if the commodity price decreases, we have a hedging gain and recognize a unrealized gain on derivative contract.

As part of our business we also engage in the purchase, sale and distribution of food and feed products.

If we do not have a matching sales contract related to such products, (for example, any commodity products that are unsold in our inventory), we have price risk that we currently do not or are unable to hedge.

As such, any decline in pricing for such products may adversely impact our profitability.

The follow table sets forth the fair value of derivatives not designated as hedging instruments as of March 31, 2025 and December 31, 2024:

Derivatives Balance Sheet Location March 31, 2025 December 31, 2024

Asset (liability) derivatives:

Derivative contracts Other current assets — 18,602

Derivative asset Other current assets — 93,520

Derivative liability Other current liabilities — ( 92,094 )

Total — 20,028

Sadot Group, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

The table below summarizes the realized g ain or (loss) on the Company’s derivative instruments that are not designated as hedges and their location in the Unaudited Condensed Consolidated Statement of Operations and Other Comprehensive Income / (Loss):

Three Months Ended March 31,

Derivatives Location of Gain / (Loss) Recognized 2025 2024

Derivative contracts Cost of goods sold 3,028 3,259

Total 3,028 3,259

See Note 17 – Commitments and contingencies for additional information.

Stock Option and Stock Issuance Plan

1 unchanged sentence

Under the 2021 Plan, the Company reserved 150,000 shares of common stock for issuance.

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.

As of March 31, 2025, 65,643 shares have been issued and 71,857 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.

Under the 2023 Plan, the Company reserved 250,000 shares of common stock for issuance.

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.

As of March 31, 2025, 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.

Under the 2024 Plan, the Company reserved 750,000 shares of common stock for issuance.

As of September 30, 2024, 279,914 shares have been issued under the 2024 Plan.

As of March 31, 2025, 593,614 shares have been issued under the 2024 Plan.

Common Stock Issuances

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.

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)

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.

On May 10, 2023 the Company authorized the issuance of 13,965 shares of common stock to a consultant for services rendered.

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.

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.

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.

On July 14, 2023, The Company issued 885,545 Restricted Share Awards, with an effective issuance date of April 1, 2023.

On August 15, 2023, the Company authorized the issuance of 5,000 shares of common stock to a consultant for services rendered.

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.

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.

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.

1 unchanged sentence

On January 11, 2024, the Company authorized the issuance of 27,891 shares of common stock in connection with the conversion of notes payable.

Sadot Group, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

On January 22, 2024, the Company authorized the issuance of 30,577 shares of common stock in connection with the conversion of notes payable.

6 unchanged sentences

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.

Sadot Group, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

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.

On August 14, 2024, the Company authorized the issuance of 54,981 shares of common stock in connection with the conversion of notes payable.

On August 19, 2024, the Company authorized the issuance of 104,249 shares of common stock in connection with the conversion of notes payable.

On August 26, 2024 the Company authorized the issuance of 47,500 shares of common stock to a consultant for services rendered.

On September 27, 2024, the Company authorized the issuance of 62,549 shares of common stock in connection with the conversion of notes payable.

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.

On March 25, 2025, the Company authorized the issuance of 34,074 shares of common stock to consultants for services rendered.

On March 31, 2025, the Company vested 79,342 shares of common stock to Aggia as consulting fees earned during the first quarter of 2025.

Preferred Stock

Our authorized preferred stock consists of 10,000,000 shares of preferred stock, $ 0.0001 par value per share.

As of September 30, 2024 there are no shares of preferred stock currently issued and outstanding.

As of March 31, 2025 there are no shares of preferred stock currently issued and outstanding.

Restricted Share Awards

Per Addendum 2, on July 14, 2023, the Company issued Restricted Share Awards ("RSA's") to Aggia.

These RSA are considered issued as of the effective date on April 1, 2023.

These RSA's are considered issued as of the effective date on April 1, 2023.

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 .

1 unchanged sentence

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.

The total RSA's vested for Aggia for the three and nine months ended September 30, 2024 were 121,149 and 311,142 , respectively.

The total RSA's vested for Aggia for the three months ended March 31, 2025 were 79,342 .

Sadot Group, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

At September 30, 2024, there were 722,068 restricted share awards outstanding awarded to employees, consultants and the board of directors.

At March 31, 2025, there were 641,711 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:

4 unchanged sentences

Vested ( 74,007 ) 9.70

Unvested at September 30, 2023 746,274 12.50

Unvested at March 31, 2024 1,049,470 9.32

Unvested at December 31, 2024 640,329 6.49

2 unchanged sentences

Vested ( 153,280 ) 8.08

Unvested at September 30, 2024 722,068 8.70

Unvested at March 31, 2025 641,711 5.86

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.

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.

Change in fair value of stock-based compensation was $ 0.8 million and $ 0.5 million for the three months ended March 31, 2025, and 2024, respectively.

See Note 17 – 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.

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.

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.

Sadot Group, Inc.

7 unchanged sentences

Outstanding, December 31, 2023 10.90 82,750 4.26 —

Granted 15.05 60,000 5.67 —

Granted — — N/A —

Exercised — — N/A —

Forfeited 15.10 ( 1,500 ) N/A —

Outstanding, September 30, 2023 15.15 101,250 4.49 90

Exercisable and vested, September 30, 2023 23.94 28,127 3.04 26

Outstanding, March 31, 2024 11.00 81,250 3.92 —

Exercisable and vested, March 31, 2024 9.70 24,752 3.77 —

Outstanding, December 31, 2024 10.84 81,250 3.17 —

2 unchanged sentences

Forfeited 15.05 ( 2,500 ) N/A —

Outstanding, September 30, 2024 10.90 81,250 3.42 3,125

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:

Nine Months Ended September 30, 2024

Risk free interest rate 1.53 - 4.33 %

Expected term (years) 5.00

Expected volatility 59.10 - 156.87 %

Expected dividends —

Warrant Exercise Agreement

On July 27, 2023 (the “Closing Date”), the Company entered into a Warrant Exercise Agreement (the “Exercise Agreement”) with Altium Growth Fund Ltd.

(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.

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

In connection with the exercise of the Original Warrants, the Company issued an additional warrant to the Exercising Holder that is exercisable for the number of shares of common stock equal to one hundred percent of the Shares purchased by the Exercising Holder (the “Additional Warrant”).

The Additional Warrant is substantially identical to the Original Warrants, except that the exercise price of the Additional Warrant is $ 24.00 .

The Company is obligated to file a registration statement covering the shares of common stock underlying the warrants within 30 days and to have the registration statement declared effective within 90 days after filing with the Commission.

Sadot Group, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

A summary of warrants activity during the nine months ended September 30, 2024 and 2023 is presented below:

Outstanding, March 31, 2025 10.70 78,750 2.76 —

Exercisable and vested, March 31, 2025 9.97 39,864 2.69 —

A summary of warrants activity during the three months ended March 31, 2025 and 2024 is presented below:

Weighted-average

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Outstanding, December 31, 2023 19.69 1,737,989 2.61 —

Granted 24.00 215,331 3.14 —

Exercised 10.00 ( 215,331 ) 3.15 215

Granted — — N/A —

Exercised — — N/A —

Forfeited 36.60 ( 32,364 ) N/A —

Outstanding, September 30, 2023 20.20 1,803,364 2.80 —

Exercisable, September 30, 2023 20.20 1,803,364 2.80 —

Outstanding, March 31, 2024 19.40 1,705,625 2.41 —

Exercisable, March 31, 2024 19.40 1,705,625 2.41 —

Outstanding, December 31, 2024 18.62 1,593,020 1.82 —

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Forfeited 60.00 ( 12,321 ) N/A —

Outstanding, September 30, 2024 18.62 1,593,020 2.07 —

Exercisable, September 30, 2024 18.62 1,593,020 2.07 —

Outstanding, March 31, 2025 18.30 1,580,699 1.58 —

Exercisable, March 31, 2025 18.30 1,580,699 1.58 —

Stock-Based Compensation Expense

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.

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.

Stock-based compensation related to restricted stock issued to employees, directors and consultants amounted to $ 1.4 million for the three months ended March 31, 2025, of which $ 0.2 million, were executive compensation, $ 0.1 million were given to the board of directors, $ 0.2 million were given to consultants for services rendered and $ 1.0 million were stock-based consulting expenses paid to related party.

Sadot Group, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

Stock-based compensation related to restricted stock issued to employees, directors and consultants, warrants and warrants to consultants amounted to $ 0.8 million for the three months ended March 31, 2024, of which $ 45.5 thousand, were executive compensation, $ 36.1 thousand, were given to the board of directors, $ 0.1 million were given to consultants for services rendered and $ 0.6 million were stock-based consulting expenses paid to related party.

Sadot Group, Inc.

Notes to the Condensed Consolidated Financial Statements (Unaudited)

Related Party Transactions

The Company held a Special Shareholder Meeting on February 28, 2023.

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;

At the meeting, the shareholders approved (i) the Services Agreement whereby Sadot LLC engaged Aggia, to provide certain advisory services to Sadot Agri-Foods for managing Sadot Agri-Food’s business of wholesaling food and engaging in the purchase and sale of physical food commodities;

(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 ;

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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.

As of September 30, 2024, Aggia owned 11.8 % of the Company's common stock.

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.

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.

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.

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.

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 .

As of March 31, 2025, Aggia owned 11.2 % of the Company's common stock.

During the three months ended March 31, 2025, the Company recorded Stock-based consulting expense of $ 1.0 million to its related party, Aggia for consulting services rendered.

During the three months ended March 31, 2024, the Company recorded Stock-based consulting expense of $ 0.6 million to its related party, Aggia for consulting services rendered.

Additionally, for the three months ended March 31, 2025, the Company reimbursed Aggia for all operating costs related to Sadot Agri-Foods of $ 0.8 million.

For the three months ended March 31, 2024, the Company reimbursed Aggia for all operating costs related to Sadot Agri-Foods of $ 1.1 million.

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 on April 10, 2025.

This loan has been extended until July 18, 2025.

On March 26, 2025, SGI launched Sadot South Korea and retained a 70 % controlling interest.

The entity that owns the 30 % non-controlling interest, is 50 % owned by one of our board members.

In addition she is paid compensation for her services in Sadot South Korea.

As of March 31, 2025, 17,037 shares of stock was issued to the board member as compensation for services related to Sadot South Korea from January 6, 2025 through March 31, 2025.

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.

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Subsequent Events

Promissory Notes

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.

On October 11, 2024, the Company paid off its loan Yorkville in the amount of $ 800,000 .

On October 15, 2024, the Company entered into a Standard Merchant Cash Advance Agreement with Cedar Advance LLC

(“Cedar”) providing for the sale of receivables in the amount of $ 3.2 million for the purchase price of $ 2.4 million.

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;

and (b) all proceeds, as that term is defined by Article 9 of the UCC.

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.

The Company paid off the remaining balance of the previous Cedar advance of $ 1.1 million in this transaction.

Farming Operations

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.

Legal Complaint

On November 7, 2024, Lombard Trading International Corp.

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.:

2024-020971-CA-01).

The Amended Complaint alleges unjust enrichment, conversion, fraud, conspiracy and civil theft related to a commodities transaction.

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.

The Company denies these allegations and intends to vigorously defend against the claims.

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

Service Agreement

Effective April 1, 2025, Sadot Canada, has entered into a management services agreement with Big Sky Milling.

Under the agreement, Sadot Canada will provide full-scale management services to Big Sky Milling, supporting its operations and driving growth across its business.

In return, Sadot Canada will earn a monthly service fee for its management services.

The agreement also grants Sadot Canada access to Big Sky Milling's state-of-the-art facility in Bowden, Alberta for transloading and toll processing activities in support of its growing export operations, providing access to a strategically located facility in a key growing region in Canada.

On April 30, 2025, the service agreement with Buenaventura to run the day to day operation of Sadot Latam was terminated.

Notes Payable

Two loans, one to a related party, that are secured by the sale of the Sadot Food Services were extended from April 10, 2025, until July 18, 2025, for an additional $ 1.0 million.

On April 24, 2025, the Company entered into a new merchant cash advance for $ 1.9 million and paid off the previous advance of $ 1.0 million.

On April 25, 2025, the company exchanged a note payable of $ 25.0 thousand for 18,939 shares of common stock.

On April 30, 2025, the company exchanged a note payable of $ 0.1 million for 49,242 shares of common stock.

On May 6, 2025, the company exchanged a note payable of $ 0.1 million for 42,735 shares of common stock.

On May 9, 2025, the Company entered into a new merchant cash advance for $ 0.5 million.

On May 12, 2025, the company exchanged a note payable of $ 0.1 million for 48,558 shares of common stock.

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

What changed 10-Q

Item 1. Financial Statements