{"url_path":"/sec/brls/10-q/2026/cover-page","section_key":"cover-page","section_title":"Cover Page","topic":"sec","document":{"doc_type":"10-Q","doc_date":"2026-06-30","source_url":"https://www.sec.gov/Archives/edgar/data/1852973/0001213900-26-073767-index.html","accession_number":"0001213900-26-073767","cik":"0001852973","ticker":"BRLS","issuer_name":"Borealis Foods Inc.","edgar_url":"https://www.sec.gov/Archives/edgar/data/1852973/0001213900-26-073767-index.html","primary_entity_key":"0001852973","primary_entity_name":"Borealis Foods Inc."},"word_count":2249,"has_tables":true,"body_markdown":"brls-20260331\n\n1\n\nhttp://fasb.org/srt/2026#ChiefExecutiveOfficerMember\n\nUnlimited\nUnlimited\nUnlimited\nUnlimited\nUnlimited\nUnlimited\n\nfalse\n0001852973\n--12-31\nQ1\n\n0001852973\n\nsrt:BoardOfDirectorsChairmanMember\nsrt:ScenarioForecastMember\n\n2026-04-01\n2026-05-29\n\n0001852973\n\nus-gaap:SubsequentEventMember\nbrls:OxusCreditAgreementMember\n\n2026-04-27\n2026-04-27\n\n0001852973\n\nus-gaap:SubsequentEventMember\nbrls:OxusCreditAgreementMember\n\n2026-04-27\n\n0001852973\n\nus-gaap:SubsequentEventMember\nbrls:OxusCapitalMember\n\n2026-04-27\n\n0001852973\n\n2026-01-01\n2026-03-31\n\n0001852973\n\n2025-01-01\n2025-03-31\n\n0001852973\n\nbrls:InternationalMember\n\n2025-01-01\n2025-03-31\n\n0001852973\n\nbrls:InternationalMember\n\n2026-01-01\n2026-03-31\n\n0001852973\n\nbrls:PacificMember\n\n2025-01-01\n2025-03-31\n\n0001852973\n\nbrls:PacificMember\n\n2026-01-01\n2026-03-31\n\n0001852973\n\nbrls:MountainMember\n\n2025-01-01\n2025-03-31\n\n0001852973\n\nbrls:MountainMember\n\n2026-01-01\n2026-03-31\n\n0001852973\n\nus-gaap:NortheastRegionMember\n\n2025-01-01\n2025-03-31\n\n0001852973\n\nus-gaap:NortheastRegionMember\n\n2026-01-01\n2026-03-31\n\n0001852973\n\nus-gaap:SouthwestRegionMember\n\n2025-01-01\n2025-03-31\n\n0001852973\n\nus-gaap:SouthwestRegionMember\n\n2026-01-01\n2026-03-31\n\n0001852973\n\nus-gaap:MidwestRegionMember\n\n2025-01-01\n2025-03-31\n\n0001852973\n\nus-gaap:MidwestRegionMember\n\n2026-01-01\n2026-03-31\n\n0001852973\n\nus-gaap:SoutheastRegionMember\n\n2025-01-01\n2025-03-31\n\n0001852973\n\nus-gaap:SoutheastRegionMember\n\n2026-01-01\n2026-03-31\n\n0001852973\n\nus-gaap:RestrictedStockUnitsRSUMember\n\n2025-01-01\n2025-03-31\n\n0001852973\n\nus-gaap:RestrictedStockUnitsRSUMember\n\n2026-01-01\n2026-03-31\n\n0001852973\n\nus-gaap:RestrictedStockMember\n\n2026-01-01\n2026-03-31\n\n0001852973\n\nus-gaap:RestrictedStockMember\n\n2025-12-31\n\n0001852973\n\nus-gaap:RestrictedStockMember\n\n2025-03-31\n\n0001852973\n\nus-gaap:RestrictedStockMember\n\n2025-01-01\n2025-03-31\n\n0001852973\n\nus-gaap:RestrictedStockMember\n\n2024-12-31\n\n0001852973\n\nus-gaap:WarrantMember\n\n2025-11-19\n\n0001852973\n\nus-gaap:WarrantMember\n\n2025-11-19\n2025-11-19\n\n0001852973\n\nus-gaap:WarrantMember\n\n2025-07-13\n\n0001852973\n\nus-gaap:WarrantMember\n\n2025-07-13\n2025-07-13\n\n0001852973\n\nus-gaap:WarrantMember\n\n2026-01-01\n2026-03-31\n\n0001852973\n\n2026-03-31\n\n0001852973\n\nus-gaap:WarrantMember\n\n2026-03-31\n\n0001852973\n\nbrls:PrivatePlacementTwoMember\n\n2026-03-31\n\n0001852973\n\nbrls:PrivatePlacementTwoMember\n\n2026-01-01\n2026-03-31\n\n0001852973\n\nbrls:PrivatePlacementOneMember\n\n2026-03-31\n\n0001852973\n\nbrls:PrivatePlacementOneMember\n\n2026-01-01\n2026-03-31\n\n0001852973\n\nbrls:PublicWarrantsMember\n\n2026-03-31\n\n0001852973\n\nbrls:PublicWarrantsMember\n\n2026-01-01\n2026-03-31\n\n0001852973\n\nus-gaap:PrivatePlacementMember\n\n2026-03-31\n\n0001852973\n\nus-gaap:PrivatePlacementMember\n\n2026-01-01\n2026-03-31\n\n0001852973\n\ncountry:US\n\n2026-01-01\n2026-03-31\n\n0001852973\n\ncountry:CA\n\n2026-01-01\n2026-03-31\n\n0001852973\n\nus-gaap:RelatedPartyMember\n\n2025-11-01\n2025-11-30\n\n0001852973\n\nbrls:OxusCreditAgreementMember\nsrt:ScenarioForecastMember\n\n2026-05-29\n2026-05-29\n\n0001852973\n\nbrls:OxusCreditAgreementMember\nsrt:ScenarioForecastMember\n\n2026-05-29\n\n0001852973\n\nbrls:OxusCreditAgreementMember\nsrt:ScenarioForecastMember\n\n2026-07-01\n\n0001852973\n\nbrls:OxusCreditAgreementMember\nsrt:ScenarioForecastMember\n\n2026-07-01\n2026-07-01\n\n0001852973\n\nbrls:SubscriptionAgreementMember\nsrt:ScenarioForecastMember\n\n2026-07-01\n\n0001852973\n\nbrls:SubscriptionAgreementMember\nsrt:ScenarioForecastMember\n\n2026-07-01\n2026-07-01\n\n0001852973\n\nbrls:NoteThreeMember\n\n2026-03-31\n\n0001852973\n\nbrls:NoteThreeMember\n\n2026-01-01\n2026-03-31\n\n0001852973\n\nbrls:NoteTwoMember\n\n2026-03-31\n\n0001852973\n\nbrls:NoteTwoMember\n\n2026-01-01\n2026-03-31\n\n0001852973\n\nbrls:NoteOneMember\n\n2026-03-31\n\n0001852973\n\nbrls:NoteOneMember\n\n2026-01-01\n2026-03-31\n\n0001852973\n\nus-gaap:SubsequentEventMember\nbrls:FrontWellCapitalPartnersIncMember\n\n2026-04-27\n\n0001852973\n\nus-gaap:LineOfCreditMember\n\n2025-12-31\n\n0001852973\n\nus-gaap:LineOfCreditMember\n\n2026-03-31\n\n0001852973\n\nus-gaap:LineOfCreditMember\nsrt:MaximumMember\n\n2026-01-01\n2026-03-31\n\n0001852973\n\nus-gaap:LineOfCreditMember\n\n2026-01-01\n2026-03-31\n\n0001852973\n\n2025-09-30\n2025-09-30\n\n0001852973\n\n2023-01-01\n2023-12-31\n\n0001852973\n\nus-gaap:RevolvingCreditFacilityMember\n\n2023-12-31\n\n0001852973\n\n2023-12-31\n\n0001852973\n\n2021-01-01\n2021-12-31\n\n0001852973\n\nbrls:QualifiedFinancingEventMember\n\n2021-12-31\n\n0001852973\n\n2021-12-31\n\n0001852973\n\n2025-12-31\n\n0001852973\n\nus-gaap:ConstructionInProgressMember\n\n2025-12-31\n\n0001852973\n\nus-gaap:ConstructionInProgressMember\n\n2026-03-31\n\n0001852973\n\nus-gaap:FurnitureAndFixturesMember\n\n2025-12-31\n\n0001852973\n\nus-gaap:FurnitureAndFixturesMember\n\n2026-03-31\n\n0001852973\n\nus-gaap:BuildingImprovementsMember\n\n2025-12-31\n\n0001852973\n\nus-gaap:BuildingImprovementsMember\n\n2026-03-31\n\n0001852973\n\n2025-03-31\n\n0001852973\n\nbrls:OneZeroVendorsMember\nus-gaap:SupplierConcentrationRiskMember\nbrls:PurchaseMember\n\n2025-01-01\n2025-03-31\n\n0001852973\n\nbrls:OneZeroVendorsMember\nus-gaap:SupplierConcentrationRiskMember\nbrls:PurchaseMember\n\n2026-01-01\n2026-03-31\n\n0001852973\n\nus-gaap:CustomerConcentrationRiskMember\nbrls:ThreeCustomersMember\nus-gaap:AccountsReceivableMember\n\n2025-01-01\n2025-12-31\n\n0001852973\n\nus-gaap:CustomerConcentrationRiskMember\nbrls:ThreeCustomersMember\nus-gaap:AccountsReceivableMember\n\n2026-01-01\n2026-03-31\n\n0001852973\n\nus-gaap:CustomerConcentrationRiskMember\nbrls:TwoCustomerMember\nus-gaap:AccountsReceivableMember\n\n2025-01-01\n2025-12-31\n\n0001852973\n\nus-gaap:CustomerConcentrationRiskMember\nbrls:TwoCustomerMember\nus-gaap:AccountsReceivableMember\n\n2026-01-01\n2026-03-31\n\n0001852973\n\nus-gaap:CustomerConcentrationRiskMember\nus-gaap:SalesRevenueNetMember\nbrls:FourCustomersMember\n\n2025-01-01\n2025-03-31\n\n0001852973\n\nus-gaap:CustomerConcentrationRiskMember\nus-gaap:SalesRevenueNetMember\nbrls:FourCustomersMember\n\n2026-01-01\n2026-03-31\n\n0001852973\n\nus-gaap:CustomerConcentrationRiskMember\nbrls:ThreeCustomersMember\nus-gaap:SalesRevenueNetMember\n\n2025-01-01\n2025-03-31\n\n0001852973\n\nus-gaap:CustomerConcentrationRiskMember\nbrls:ThreeCustomersMember\nus-gaap:SalesRevenueNetMember\n\n2026-01-01\n2026-03-31\n\n0001852973\n\nbrls:RevenueAndCostRecognitionAndAccountsReceivableMember\n\n2025-01-01\n2025-03-31\n\n0001852973\n\nbrls:RevenueAndCostRecognitionAndAccountsReceivableMember\n\n2026-01-01\n2026-03-31\n\n0001852973\n\nus-gaap:RelatedPartyMember\n\n2026-03-31\n\n0001852973\n\nbrls:NotesPayableMember\n\n2026-03-31\n\n0001852973\n\nus-gaap:RelatedPartyMember\nsrt:ScenarioForecastMember\n\n2026-06-30\n\n0001852973\n\nus-gaap:RelatedPartyMember\n\n2025-12-31\n\n0001852973\n\nbrls:FurnitureFixturesEquipmentAndMachineHoursMember\n\n2026-03-31\n\n0001852973\n\nus-gaap:FurnitureAndFixturesMember\nsrt:MaximumMember\n\n2026-03-31\n\n0001852973\n\nus-gaap:FurnitureAndFixturesMember\nsrt:MinimumMember\n\n2026-03-31\n\n0001852973\n\nus-gaap:BuildingImprovementsMember\nsrt:MaximumMember\n\n2026-03-31\n\n0001852973\n\nus-gaap:BuildingImprovementsMember\nsrt:MinimumMember\n\n2026-03-31\n\n0001852973\n\nsrt:ScenarioForecastMember\n\n2026-07-01\n2026-07-01\n\n0001852973\n\nus-gaap:SubsequentEventMember\n\n2026-04-27\n\n0001852973\n\n2024-12-31\n\n0001852973\n\nus-gaap:CommonClassAMember\n\n2026-03-31\n\n0001852973\n\nus-gaap:RetainedEarningsMember\n\n2026-03-31\n\n0001852973\n\nus-gaap:AdditionalPaidInCapitalMember\n\n2026-03-31\n\n0001852973\n\nus-gaap:CommonStockMember\nus-gaap:CommonClassAMember\n\n2026-03-31\n\n0001852973\n\nus-gaap:RetainedEarningsMember\n\n2026-01-01\n2026-03-31\n\n0001852973\n\nus-gaap:AdditionalPaidInCapitalMember\n\n2026-01-01\n2026-03-31\n\n0001852973\n\nus-gaap:RetainedEarningsMember\n\n2025-12-31\n\n0001852973\n\nus-gaap:AdditionalPaidInCapitalMember\n\n2025-12-31\n\n0001852973\n\nus-gaap:CommonStockMember\nus-gaap:CommonClassAMember\n\n2025-12-31\n\n0001852973\n\nus-gaap:RetainedEarningsMember\n\n2025-03-31\n\n0001852973\n\nus-gaap:AdditionalPaidInCapitalMember\n\n2025-03-31\n\n0001852973\n\nus-gaap:CommonStockMember\nus-gaap:CommonClassAMember\n\n2025-03-31\n\n0001852973\n\nus-gaap:RetainedEarningsMember\n\n2025-01-01\n2025-03-31\n\n0001852973\n\nus-gaap:AdditionalPaidInCapitalMember\n\n2025-01-01\n2025-03-31\n\n0001852973\n\nus-gaap:CommonStockMember\nus-gaap:CommonClassAMember\n\n2025-01-01\n2025-03-31\n\n0001852973\n\nus-gaap:RetainedEarningsMember\n\n2024-12-31\n\n0001852973\n\nus-gaap:AdditionalPaidInCapitalMember\n\n2024-12-31\n\n0001852973\n\nus-gaap:CommonStockMember\nus-gaap:CommonClassAMember\n\n2024-12-31\n\n0001852973\n\n2026-06-30\n\n0001852973\n\nbrls:Warrants1Member\n\n2026-01-01\n2026-03-31\n\n0001852973\n\nbrls:CommonShares1Member\n\n2026-01-01\n2026-03-31\n\n0001852973\n\nus-gaap:RestrictedStockMember\n\n2026-03-31\n\n0001852973\n\nus-gaap:CommonStockMember\nus-gaap:CommonClassBMember\n\n2024-12-31\n\n0001852973\n\nus-gaap:CommonStockMember\nus-gaap:CommonClassCMember\n\n2024-12-31\n\n0001852973\n\nus-gaap:CommonStockMember\nus-gaap:CommonClassBMember\n\n2025-01-01\n2025-03-31\n\n0001852973\n\nus-gaap:CommonStockMember\nus-gaap:CommonClassCMember\n\n2025-01-01\n2025-03-31\n\n0001852973\n\nus-gaap:CommonStockMember\nus-gaap:CommonClassBMember\n\n2025-03-31\n\n0001852973\n\nus-gaap:CommonStockMember\nus-gaap:CommonClassCMember\n\n2025-03-31\n\n0001852973\n\nus-gaap:CommonStockMember\nus-gaap:CommonClassBMember\n\n2025-12-31\n\n0001852973\n\nus-gaap:CommonStockMember\nus-gaap:CommonClassCMember\n\n2025-12-31\n\n0001852973\n\nus-gaap:CommonStockMember\nus-gaap:CommonClassAMember\n\n2026-01-01\n2026-03-31\n\n0001852973\n\nus-gaap:CommonStockMember\nus-gaap:CommonClassBMember\n\n2026-01-01\n2026-03-31\n\n0001852973\n\nus-gaap:CommonStockMember\nus-gaap:CommonClassCMember\n\n2026-01-01\n2026-03-31\n\n0001852973\n\nus-gaap:CommonStockMember\nus-gaap:CommonClassBMember\n\n2026-03-31\n\n0001852973\n\nus-gaap:CommonStockMember\nus-gaap:CommonClassCMember\n\n2026-03-31\n\n0001852973\n\nus-gaap:CommonClassBMember\n\n2026-01-01\n2026-03-31\n\n0001852973\n\nus-gaap:CommonClassCMember\n\n2026-01-01\n2026-03-31\n\n0001852973\n\nus-gaap:CommonClassAMember\n\n2026-01-01\n2026-03-31\n\n0001852973\n\nus-gaap:CommonClassAMember\n\n2025-01-01\n2025-03-31\n\n0001852973\n\nus-gaap:CommonClassBMember\n\n2025-01-01\n2025-03-31\n\n0001852973\n\nus-gaap:CommonClassCMember\n\n2025-01-01\n2025-03-31\n\niso4217:USD\n\nxbrli:shares\n\niso4217:USD\n\nxbrli:shares\n\nxbrli:pure\n\nbrls:Segment\n\nbrls:Hours\n\n \n\n \n\nUNITED STATES\n\nSECURITIES AND EXCHANGE COMMISSION\n\nWashington, D.C. 20549\n\n \n\nFORM 10-Q\n\n \n\n☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934\n\n \n\nFor the quarterly period ended\n\n \n\nMarch 31, 2026\n\n \n\nOR\n\n \n\n☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934\n\n \n\nFor the transition period from          to          \n\n \n\nBorealis Foods Inc.\n\n(Exact name of registrant as specified in its\ncharter)\n\n \n\nOntario 001-40778 98-1638988\n\n(State or other jurisdiction of\n\nincorporation or organization)\n \n(Commission File Number)\n \n(I.R.S. Employer\n\nIdentification Number)\n\n \n\n1540 Cornwall Rd. #104\nOakville, Ontario, Canada L6J 7W5\n\n(Address of principal executive offices)\n \n(Zip Code)\n\n \n\nRegistrant’s telephone number, including area code: (905) 278-2200\n\n \n\nNot Applicable\n\n(Former name, former address, and former fiscal\nyear, if changed since last report)\n\n \n\nSecurities registered pursuant to Section 12(b) of\nthe Act:\n\n \n\nTitle of Each Class:\n \nTrading Symbol:\n \nName of Each Exchange on Which Registered:\n\nCommon Shares BRLS \nNasdaq Capital Market\n\nWarrants BRLSW Nasdaq Capital Market\n\n \n\nIndicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐\n\n \n\nIndicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐\n\n \n\nIndicate by check mark whether the registrant\nis a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company.\nSee the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,”\nand “emerging growth company” in Rule 12b-2 of the Exchange Act.\n\n \n\nLarge accelerated filer\n☐\nAccelerated filer\n☐\n\nNon-accelerated filer☒Smaller reporting company☒\n\nEmerging growth company☒  \n\n \n\nIf an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐\n\n \n\nIndicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒\n\n \n\nAs of June 30, 2026, 21,463,306 Common Shares of the registrant, no par value, were issued and outstanding.\n\n \n\n \n\n \n\n \n\n \n\n \n\nCAUTIONARY NOTE ON FORWARD-LOOKING STATEMENTS\n\n \n\nThis Quarterly Report on Form 10-Q (this “Quarterly\nReport”) filed by Borealis Foods Inc. (the “Company” or “Borealis Foods”, “our”,\n“us” or “we”) contains statements that are forward-looking and as such are not historical facts.\nThis includes, without limitation, statements regarding the financial position, business strategy and the plans and objectives of management\nfor future operations. These statements constitute projections, forecasts, and forward-looking statements, and are not guarantees of performance.\nSuch statements can be identified by the fact that they do not relate strictly to historical or current facts. When used in this Quarterly\nReport, words such as “anticipate,” “believe,” “continue,” “could,” “estimate,”\n“expect,” “intend,” “may,” “might,” “plan,” “possible,” “potential,”\n“predict,” “project,” “should,” “strive,” “would” and similar expressions\nmay identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. When we\ndiscuss our strategies or plans, we are making projections, forecasts, or forward-looking statements. Such statements are based on the\nbeliefs of, as well as assumptions made by and information currently available to, Borealis Foods’ management.\n\n \n\nForward-looking statements may include, for example,\nstatements about:\n\n \n\n●our senior secured debt is held by a related party that also holds a significant equity position and has\nthe right to appoint directors to our Board, which may create conflicts of interest;\n\n \n\n●\napproximately\n$29.1 million of shareholder indebtedness (plus approximately $4.3 million of accrued interest\nas of June 30, 2026) is contractually subject to automatic conversion into Common Shares\non or after July 1, 2026 if we do not consummate equity financings of at least $70.0 million\nat $9.00 per share, although such conversion is deferred pending receipt of shareholder approvals\nrequired under Nasdaq Listing Rules 5635(b) and 5635(d), and any such conversion when effected\nwould result in substantial dilution to existing shareholders;\n\n \n\n●our Board of Directors has been reconstituted at the direction of our lender, and the lender-appointed\ndirectors may not act independently of the lender’s interests in all circumstances;\n\n \n\n●our independent registered public accounting firm has expressed substantial doubt about our ability to\ncontinue as a going concern;\n\n \n\n●our limited operating history makes it difficult to evaluate our business and prospects;\n\n \n\n●our potential insolvency or inability to pay our debt would have a material adverse effect on our business,\nfinancial condition, results of operations and cash flow;\n\n \n\n●we may be unable to execute our business plan or maintain our competitive position and high-level customer\nsatisfaction if we fail to maintain adequate operational and financial resources or fail to obtain additional financing, particularly\nif we continue to grow rapidly;\n\n \n\n●we have a substantial debt burden, a significant portion of which matures soon and requires repayment\nor refinancing;\n\n \n\n●our management team has limited experience managing a public company;\n\n \n\n●we are an early stage and emerging growth company and, as such, we are subject to all the risks associated\nwith early stage and emerging growth companies;\n\n \n\n \n\n \n\n \n\n●we have identified material weaknesses in our internal control over financial reporting; if we fail to\nmaintain an effective system of internal control over financial reporting, we may not be able to accurately report our financial results\nor prevent fraud. As a result, shareholders could lose confidence in our financial and other public reporting, which would harm our business\nand the trading price of our Common Shares;\n\n \n\n●a significant portion of our revenue is concentrated with a limited number of customers;\n\n \n\n●adverse climate conditions may have an adverse effect on our business. We may take various actions to\nmitigate our business risks associated with climate change, which may require us to incur substantial costs and may not be successful,\ndue to, among other things, the uncertainty associated with the longer-term projections associated with managing climate risks;\n\n \n\n●our dependence on suppliers may materially adversely affect our operating results and financial position;\n\n \n\n●manufacturing and production forecasts are based on multiple assumptions. We must adequately estimate\nour manufacturing capacity and inventory supply. If we overestimate our demand and overbuild our capacity or inventory, we may have significantly\nunderutilized assets. Underutilization of our manufacturing facilities can adversely affect our gross margin and other operating results;\n\n \n\n●our business operations and financial results could be adversely affected by the evolving U.S.-Canada\ntrade environment , including tariffs under Section 232 and Section 122 of applicable U.S. trade laws, Canadian counter-tariffs, the outcome\nof Canada-United States-Mexico Agreement (CUSMA) review process and other changes in trade policies;\n\n \n\n●our business operations and financial results have been and could continue to be adversely affected by\nthe 2026 Iran war, including the closure of the Strait of Hormuz and resulting disruptions to global energy, commodity, and supply chain\nmarkets;\n\n \n\n●we previously received a notice from the Nasdaq Listing Qualifications\nDepartment regarding non-compliance with Nasdaq Listing Rule 5620(a) (annual meeting requirement), and although we held our annual meeting\nof shareholders on June 29, 2026, we have not yet received confirmation from Nasdaq that we have regained compliance;\n\n \n\n●we may experience volatility in costs for ingredients and packaging due to conditions that are difficult\nto predict;\n\n \n\n●issuances of Common Shares upon conversion of related-party indebtedness\nunder the Conversion Agreement and the May 29, 2026 convertible promissory note issued to Oxus Capital are expected to require shareholder\napproval under Nasdaq Listing Rules 5635(b), which approval has not been obtained and was not sought at our June 29, 2026 annual meeting\nof shareholders;\n\n \n\n●a $3.0 million convertible promissory note we issued to our controlling\nshareholder on May 29, 2026 is convertible at $1.45 per share into approximately 2.07 million Common Shares upon receipt of required Nasdaq\nshareholder approvals, and any such conversion would dilute existing shareholders;\n\n \n\n●U.S. shareholders may not be able to obtain judgments or enforce civil liabilities against us or our executive\nofficers or our Board of Directors (our “Board”);\n\n \n\n●other risk factors and uncertainties described in this Quarterly Report, our most recent Annual Report\non Form 10-K, and other filings with the SEC. \n\n \n\nWe urge investors to consider all of the risks,\nuncertainties, and other factors disclosed in this filing carefully in evaluating the forward-looking statements contained in this Quarterly\nReport. We cannot assure you that the results or developments anticipated by us and reflected or implied by any forward-looking statement\ncontained in this report will be realized or, even if substantially realized, that those results or developments will result in the forecasted\nor expected consequences for us or affect us, our operations or financial performance as we forecasted or expected. These forward looking\nstatements are based on information available as of the date of this Quarterly Report and current expectations, forecasts, and assumptions,\nand involve a number of judgments, risks, and uncertainties. Accordingly, forward-looking statements should not be relied upon as representing\nour views as of any subsequent date, and we do not undertake any obligation to update forward-looking statements to reflect events or\ncircumstances after the date they were made, whether as a result of new information, future events, or otherwise, except as may be required\nunder applicable securities laws. We intend the forward-looking statements contained in this Quarterly Report to be covered by the safe\nharbor provisions for forward-looking statements contained in Section 27A of the Securities Act of 1933, as amended, or the “Securities\nAct”, and Section 21E of the Securities Exchange Act of 1934, as amended, or the “Exchange Act”.\n\n \n\nAs a result of a number of known and unknown risks\nand uncertainties, our actual results or performance may be materially different from those expressed or implied by these forward-looking\nstatements. You should not place undue reliance on our forward-looking statements.\n\n \n\n \n\n \n\n \n\n \n \nPage\n\n[PART I. FINANCIAL INFORMATION](#a_001)\n1"}