{"url_path":"/sec/sowg/10-q/2026/item-1a","section_key":"item-1a","section_title":"Item 1A Risk Factors.**","topic":"sec","document":{"doc_type":"10-Q","doc_date":"2026-05-20","source_url":"https://www.sec.gov/Archives/edgar/data/1490161/0001213900-26-059638-index.html","accession_number":"0001213900-26-059638","cik":"0001490161","ticker":"SOWG","issuer_name":"Sow Good Inc.","edgar_url":"https://www.sec.gov/Archives/edgar/data/1490161/0001213900-26-059638-index.html","primary_entity_key":"0001490161","primary_entity_name":"Sow Good Inc."},"word_count":1644,"has_tables":true,"body_markdown":"** **\n\n**Item 1A. Risk Factors.**\n\n \n\n**There is substantial doubt\nabout our ability to continue as a going concern.**\n\n \n\nOur financial statements as of March 31, 2026 have been prepared under\nthe assumption that we will continue as a going concern for the next twelve months. As of March 31, 2026, we had cash and cash equivalents\nof $2.3 million and an accumulated deficit of $105.5 million. We do not believe that our cash and cash equivalents are sufficient to fund\noperations and capital expenditures to reach larger scale revenue generation from our product offerings. As a result of our financial\ncondition and other factors described herein, there is substantial doubt about our ability to continue as a going concern. Our ability\nto continue as a going concern will depend on our ability to obtain additional funding, as to which no assurances can be given. We continue\nto analyze various alternatives, including potentially obtaining debt or equity financings or other arrangements. Our future success depends\non our ability to raise capital. We cannot be certain that raising additional capital, whether through selling additional debt or equity\nsecurities or obtaining a line of credit or other loan, will be available to us or, if available, will be on terms acceptable to us, and,\nto the extent it is obtained, it would likely have rights, preferences, and privileges senior to those of holders of our common stock\nand would further dilute our current stockholders. Our ability to raise capital is also constrained by the price of and demand for our\ncommon stock. The inclusion of disclosures expressing substantial doubt about our ability to continue as a going concern could also materially\nadversely affect our stock price and our ability to raise new capital. If we are unable to obtain funds when needed or on acceptable terms,\nwe may be required to curtail our current development programs, cut operating costs, forgo future development and other opportunities,\nor even terminate our operations in which case our investors could lose some or all of their investment.\n\n \n\n**We have recently undergone a significant\ntransition in our executive leadership and Board of Directors, which may adversely affect our business and operations.**\n\n \n\nOn March 31, 2026, David Lazar resigned as our\nChief Executive Officer and Donna Guy informed our Board that she would be resigning as our Chief Financial Officer. Upon these resignations,\nour Board appointed Yisroel Goldberg as our Chief Executive Officer and Chief Financial Officer.\n\n \n\nOn the same date, our Board accepted the resignations\nof Claudia Goldfarb, Ira Goldfarb, Edward Shensky, Lyle Berman and Jeff Rubin from our Board. The Board elected Yisroel Goldberg, Binyomin\nPosen, Joseph Labkowski and Jack Wortzman to serve on the Board effective upon those resignations.\n\n \n\nThis simultaneous transition of our executive officers\nand Board of Directors represents a significant change that may adversely affect our company as a result of concentration of executive\nauthority in a single individual, impairment of our ability to maintain effective disclosure controls and procedures, failure to execute\nour business strategy and ability to retain institutional knowledge critical to our operations. There can be no assurance that our new\nmanagement team and Board will successfully manage these responsibilities, and any failure to do so could have a material adverse effect\non our business, financial condition, results of operations and the market price of our common stock.\n\n \n\nWe are conducting this at-the-market offering shortly\nfollowing this management and board transition. Purchasers of our common stock in this offering will be relying on the judgment and leadership\nof an executive team and Board that have limited experience in their current roles with our company and limited familiarity with our business\nand industry.\n\n \n\nThere can be no assurance that our new management\nteam and Board of Directors will be able to successfully manage our operations, maintain effective internal controls and disclosure procedures,\nand oversee our business strategy. Any failure to do so could have a material adverse effect on our business, financial condition, results\nof operations and the market price of our common stock.\n\n \n\n**Our failure to meet the\ncontinued listing requirements of Nasdaq could result in a delisting of our securities.**\n\n \n\nOur common stock is currently listed for trading\non Nasdaq. We must satisfy Nasdaq’s continued listing requirements. A delisting of our common stock from Nasdaq could materially\nreduce the liquidity of our common stock and result in a corresponding material reduction in the price of our common stock. In addition,\ndelisting could harm our ability to raise capital through alternative financing sources on terms acceptable to us, or at all, and may\nresult in the potential loss of confidence by investors, suppliers, customers and employees and fewer business development opportunities.\n\n \n\n34\n\n \n\nWe have in the past, and may in the future, be\nunable to comply with certain of the listing standards that we are required to meet to maintain the listing of our common shares on Nasdaq.\nFor example, on May 14, 2025, we received a letter from the Staff indicating that, based upon the closing bid price of our common stock\nfor the 30 consecutive business days, we did not meet the minimum bid price of $1.00 per share required for continued listing on Nasdaq\npursuant to the Minimum Bid Price Rule. The letter also indicated that we will be provided with a compliance period of 180 calendar days,\nor until November 10, 2025, in which to regain compliance pursuant to Nasdaq Listing Rule 5810(c)(3)(A). On November 11, 2025, Nasdaq\nsubsequently issued a letter providing us with an additional 180 day compliance period, or until May 11, 2026 to regain compliance.\n\n \n\nIn order to regain compliance with the Minimum\nBid Price Rule, our common stock must maintain a minimum closing bid price of $1.00 for at least ten consecutive business days during\nthe Minimum Bid Price Compliance Period (which we believe we cured on May 7, 2026). However, if it appears to Nasdaq that we will be unable\nto cure the deficiency, Nasdaq will provide notice that our common stock will be subject to delisting. There can be no assurance that\nthe Nasdaq staff would grant our request for continued listing subsequent to any delisting notification. In the event of such a notification,\nwe may appeal the Staff’s determination to delist its securities.\n\n \n\nFurther, on April 7, 2026, we received written\nnotice from the Listing Qualifications Department of Nasdaq stating that, based upon the stockholders’ equity reported in our Form\n10-K for the period ended December 31, 2025, we were no longer in compliance with Nasdaq Listing Rule 5550(b)(1), which requires a company\nto maintain a minimum of $2,500,000 in stockholders’ equity. In accordance with the Nasdaq Listing Rules, the Company has 45 calendar\ndays, or until May 22, 2026, to submit a plan to regain compliance. If the Company’s plan is accepted, Nasdaq may grant the Company\nan extension of up to 180 calendar days from the date of the Notice, or until October 4, 2026, to evidence compliance. If the Company’s\nplan to regain compliance with the minimum stockholders’ equity standard is not accepted or if it is accepted but the Company does\nnot regain compliance by the end of the extension granted by Nasdaq, or if the Company fails to satisfy another Nasdaq requirement for\ncontinued listing, Nasdaq staff could provide notice that the Company’s common shares will become subject to delisting. In such\nevent, Nasdaq rules permit the Company to request a hearing to appeal to a Nasdaq hearings panel, which would stay any further delisting\nactions through the hearings process. Accordingly, there can be no guarantee that the Company will be able to maintain its Nasdaq listing.\n\n \n\nThere is no assurance that we will regain compliance with, or maintain\ncompliance with the minimum listing requirements with all applicable requirements for continued listing on Nasdaq. If our common stock\nwere delisted from Nasdaq, trading of our common stock would most likely take place on an over-the-counter market established for unlisted\nsecurities, such as the OTCQB or the Pink Market maintained by OTC Markets Group Inc. An investor would likely find it less convenient\nto sell, or to obtain accurate quotations in seeking to buy, our common stock on an over-the-counter market, and many investors would\nlikely not buy or sell our common stock due to difficulty in accessing over-the-counter markets, policies preventing them from trading\nin securities not listed on a national exchange or other reasons. In addition, as a delisted security, our common stock would be subject\nto SEC rules as a “penny stock,” which impose additional disclosure requirements on broker-dealers. The regulations relating\nto penny stocks, coupled with the typically higher cost per trade to the investor of penny stocks due to factors such as broker commissions\ngenerally representing a higher percentage of the price of a penny stock than of a higher-priced stock, would further limit the ability\nof investors to trade in our common stock. In addition, delisting could harm our ability to raise capital through alternative financing\nsources on terms acceptable to us, or at all, and may result in the potential loss of confidence by investors, suppliers, customers and\nemployees and fewer business development opportunities. For these reasons and others, delisting would adversely affect the liquidity,\ntrading volume and price of our common stock, causing the value of an investment in us to decrease and having an adverse effect on our\nbusiness, financial condition and results of operations, including our ability to attract and retain qualified employees and to raise\ncapital.\n\n \n\nThese are not the only risks\nwe face. You should carefully consider these risk factors, together with the risk factors set forth in Item 1A of our Annual Report on\nForm 10-K. There have been no other material changes from the risk factors previously disclosed in the Company’s most recent Annual\nReport on Form 10-K for the year ended December 31, 2025."}