Edible Garden AG Inc
For the period ended Mar 31, 2026. Filed May 15, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2026 · Filed May 15, 2026
EDBL$0.70+0.5%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-09-30; filed 2025-11-14.
0001477932-25-008250
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-03-31; filed 2026-05-15.
0001477932-26-003238
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 85 previous paragraphs and 75 current paragraphs.
32 unchanged; 12 reworded; 31 added; 40 removed; 1 previous and 0 current paragraphs rearranged.
Tables are not compared: 4 previous and 2 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (31)
Current report
Our operations are supported by GreenThumb®, our proprietary patented greenhouse management and demand-planning software (U.S. Patent Nos. 11,158,006 B1; 11,410,249 B2; and 11,830,088 B2). GreenThumb tracks plants through all stages of production and distribution, supporting quality control, traceability, fill-rate management, and logistics optimization, including maximizing truckload efficiency to reduce greenhouse gas emissions. We believe GreenThumb is a meaningful competitive differentiator and an important component of our Zero-Waste Inspired® model.
Current report
As of March 31, 2026, we offer more than 140 stock keeping units ("SKUs") spanning two principal product segments: (i) fresh produce, including cut herbs, hydroponic basil, potted herbs, and wheatgrass; and (ii) shelf-stable and refrigerated consumer packaged goods, including sports nutrition and nutraceuticals (Kick.™ and Vitamin Whey®/Vitamin Way®), fermented gourmet sauces and chili-based products (Pulp®), and functional fermented pickles and sauerkraut (Pickle Party™). We also supply products under private label arrangements to major retail customers. We have leveraged our brand recognition to offer co-manufactured consumer-packaged goods across protein, fermented foods, and flavoring categories in addition to our core fresh produce business. Our tagline "Simply Local, Simply Fresh" reflects our strategy of growing products in regional communities close to the retail locations where they are sold, extending shelf life and supporting local brand awareness.
Current report
Our products are available in over 6,000 retail locations across the United States, the Caribbean, and South America. We operate vertically integrated greenhouses and processing facilities at Edible Garden Heartland in Grand Rapids, Michigan; Edible Garden Prairie Hills in Webster City, Iowa; and our headquarters at Edible Garden Belvidere in Belvidere, New Jersey. We also partner with a network of contract growers strategically located near major U.S. population centers.
Current report
We hold food safety certifications from Primus GFS (a Global Food Safety Initiative ("GFSI")-accredited program), USDA Organic certification for applicable products, and non-GMO verification from the non-GMO Project for select SKUs. We are licensed under the Perishable Agricultural Commodities Act ("PACA") and voluntarily comply with Hazard Analysis Critical Control Point ("HACCP") principles established by the U.S. Food and Drug Administration.
Current report
We have a history of operating losses since inception and expect to incur additional near-term losses. Our auditors have issued an opinion expressing substantial doubt about our ability to continue as a going concern. See "Risk Factors" and "Management's Discussion and Analysis — Liquidity and Capital Resources" for additional discussion of these matters.
Current report
Since our initial public offering, our primary business strategy has been focused on the production and sale of fresh, locally grown, USDA Organic produce through a vertically integrated CEA model. During the fiscal year ended December 31, 2025, and continuing into 2026, we began executing a material expansion and evolution of that strategy.
Current report
Specifically, we are transitioning our Edible Garden Prairie Hills facility in Webster City, Iowa into a dedicated ready-to-drink ("RTD") and clean nutrition manufacturing hub. This initiative represents a significant broadening of our business from primarily fresh, perishable produce into what we expect will be higher-margin, shelf-stable beverage and nutrition categories. We have characterized this evolution as the development of a vertically integrated domestic clean-label nutrition platform that combines our existing controlled-environment agriculture capabilities with scalable aseptic processing capacity and differentiated branded products across sports nutrition, adult and children's performance nutrition, and GLP-1 supportive categories.
Current report
This strategic shift, which we refer to as our "Farm-to-Formula®" strategy, connects our CEA-sourced ingredients with advanced research and development and precision formulation capabilities to deliver finished functional RTD beverages at commercial scale. This represents a material change from our previously disclosed strategy of focusing principally on fresh produce, and investors should consider the risks and opportunities associated with this expansion when evaluating our business.
Current report
On March 4, 2026, we entered into two Interim Order Agreements (the "IOAs") with Tetra Pak Inc. ("Tetra Pak"), a global leader in food processing and packaging solutions, to commence engineering services and preliminary procurement activities for the Webster City, Iowa production project (the "Project"). The IOAs cover both processing equipment and aseptic packaging systems and are intended as the initial step toward a definitive final supply agreement governing the full scope of equipment installation and integration.
Current report
The planned facility will utilize Tetra Pak's Tetra Prisma® Aseptic 330 Edge package—a format made primarily from renewable, plant-based materials that is designed to be recyclable—together with the Tetra Pak® A3/Speed filling platform. These systems are expected to extend product shelf life without refrigeration or preservatives prior to opening, support ambient distribution, maintain clean-label standards, and reduce overall supply chain costs and food waste.
Current report
Phase 1 production at the Webster City facility is anticipated to begin in 2027, subject to the execution of a final supply agreement with Tetra Pak, completion of engineering and installation, regulatory approvals, and adequate capital availability. There is no assurance that a final agreement will be executed, that the facility will be completed on the anticipated timeline, or that Phase 1 production will commence as planned. This initiative is in the early development stage, and investors should not place undue reliance on timing or scale projections, or our ability to complete the Project.
Current report
The Midwest facility encompasses more than 200,000 square feet of food-grade manufacturing space with warehousing and logistics infrastructure, and upon completion of the RTD buildout is expected to support aseptic and ultra-filtered beverage production across protein, plant-based, dairy, and functional categories. The Company intends for the facility to serve as a scalable innovation platform supporting product development and revenue diversification beyond fresh perishables.
Current report
On January 29, 2026, we filed a Certificate of Amendment to its Certificate of Incorporation with the Secretary of State of the State of Delaware to effect a 1-for-10 reverse stock split of its common stock (the “Reverse Stock Split”), effective as of 12:01 a.m. Eastern Time on February 3, 2026. As a result of the Reverse Stock Split, every 10 shares of our outstanding common stock were combined into one share of common stock. No fractional shares were issued in connection with the Reverse Stock Split; any fractional shares resulting from the Reverse Stock Split were rounded up to the nearest whole share. Proportionate adjustments were made to the per share exercise price and the number of shares issuable upon the exercise of outstanding warrants and to all then-outstanding awards under our equity incentive plan. The Reverse Stock Split did not change the par value of the common stock or the total number of authorized shares. All share and per share amounts in these condensed consolidated financial statements and related notes have been retroactively adjusted to reflect the Reverse Stock Split, unless otherwise noted.
Current report
The Reverse Stock Split was implemented, in part, to help maintain compliance with Nasdaq’s continued listing requirements. We were subject to a Panel Monitor, as defined by Nasdaq Listing Rule 5815(d)(4)(A), through April 8, 2026.
Current report
During the three months ended March 31, 2026, we entered into exchange agreements (the “Exchange Agreements”) with Streeterville Capital, LLC, a Utah limited liability company (“Streeterville”) pursuant to which we agreed to exchange an aggregate of 1,910 shares of our Series B Preferred Stock, par value $0.0001 per share (the “Preferred Stock”), for a total of 940,860 shares of our common stock, par value $0.0001 per share (“Exchange Shares”). The Preferred Stock had an aggregate stated value of $1.9 million. The number of Exchange Shares issued under the Exchange Agreements was determined by dividing the Stated Value by the Nasdaq Minimum Price of our common stock as reported on the Nasdaq Capital Market on the day immediately preceding the date the Exchange Agreements were entered into. The issuance of the Exchange Shares pursuant to the Exchange Agreements were not registered under the Securities Act of 1933, as amended (the “Securities Act”), and were conducted pursuant to the exemption provided in Section 3(a)(9) under the Securities Act.
Current report
Subsequent to March 31, 2026, we entered into additional Exchange Agreements with Streeterville pursuant to which we agreed to exchange an aggregate of 4,620 shares of the Preferred Stock with an aggregate Stated Value of $4.6 million for a total of approximately 6,966,627 Exchange Shares on the same terms described above.
Current report
In January 2026, we completed the sale of its net operating losses under the New Jersey Economic Development Authority’s Technology Business Tax Certificate Transfer Program and received gross proceeds of approximately $3.1 million.
Current report
During the three months ended March 31, 2026, we entered into a two-year distribution agreement with Busch’s Fresh Food Market and achieved chainwide distribution of its USDA Organic herbs at all The Fresh Market locations. On April 21, 2026, we were awarded new distribution with Target to supply a substantial portion of its fresh-cut herbs, with shipments expected to commence in May 2026.
Current report
In March 2026, we selected Tetra Pak® as its packaging and processing technology partner for its planned RTD beverage facility in Webster City, Iowa. On April 17, 2026, we secured a $2.7 million incentive package from the Iowa Economic Development Authority under the Business Incentives for Growth program to support the redevelopment of the our approximately 400,000 square-foot Webster City facility into a production plant for shelf-stable RTD nutritional beverages.
Current report
Revenue was $3.3 million for the three months ended March 31, 2026, compared to $2.7 million for the three months ended March 31, 2025. The increase in revenue of $623 thousand, or 22.9%, is primarily attributable to continued growth in our cut herb portfolio across our retail client base, which grew $550 thousand, or 46%.
Current report
Operating Expenses
Current report
Operating expenses were $10.0 million for the three months ended March 31, 2026, compared to $5.6 million for the three months ended March 31, 2025. The increase of $4.4 million or 77.5% was primarily due to increase in cost of goods sold and depreciation expense and amortization. Increase in cost of goods sold was primarily driven by increased sales and a portfolio shift to cut herbs, which is primarily sourced from third party growers at higher cost. Depreciation expense increase of $2.5 million was primarily due to accelerated depreciation of certain fixed assets as a result of the Company’s pivot to RTD clean nutrition manufacturing.
Current report
Interest expense was $150 thousand for the three months ended March 31, 2026, compared to $440 thousand for the three months ended March 31, 2025. Lower interest expense was driven by lower overall outstanding debt balances at lower interest rates.
Current report
Income tax benefit
Current report
Income tax benefit was $3.4 million for the three months ended March 31, 2026. We transferred state tax benefit to a third-party buyer in exchange for a cash consideration and recorded a gain driven primarily due to valuation allowance release.
Current report
In January 2026, we completed the sale of our net operating losses under the New Jersey Economic Development Authority’s Technology Business Tax Certificate Transfer Program and received gross proceeds of approximately $3.4 million.
Current report
On March 3, 2026, we entered into a Note Purchase Agreement with Streeterville Capital, LLC (“Streeterville”), pursuant to which we issued to Streeterville a secured promissory note in the principal amount of $1.6 million (the “Streeterville Note”), which included an original issue discount of $120 thousand and reimbursement of Streeterville’s transaction expenses of $5 thousand, for a purchase price of $1.5 million. The Streeterville Note bears interest at a rate of 8.0% per annum and matures 13 months after its issuance date.
Current report
We expect to continue to incur losses and negative cash flows from operations for the foreseeable future. We may seek to raise additional capital through equity or debt financings, sales of assets, or other strategic alternatives. There can be no assurance that any additional financing will be available on acceptable terms, or at all. If we are unable to raise additional capital in sufficient amounts or on terms acceptable to us, we may have to significantly reduce our operations or delay, scale back or discontinue the development of one or more of our products or operations.
Current report
During the three months ended March 31, 2026, cash provided by operating activities was $251 thousand. During the three months ended March 31, 2025, cash used for operating activities was $3.3 million. For the period ended March 31, 2026, the net loss of $3.7 million was offset by accelerated depreciation of certain fixed assets related to Company’s pivot to RTD manufacturing of $2.7 million, amortization of operating lease right of use assets related to Natural Shrimp totaling $304 thousand, and working capital decrease of $827 thousand. For the period ended March 31, 2025, the net loss of $3.3 million was offset by depreciation and amortization expense, as well as amortization of debt discount totaling $678 thousand, working capital increase of $686 thousand.
Current report
During the three months ended March 31, 2026 and 2025, cash used in investing activities was $104 thousand and $68 thousand, respectively. The increase is related to the cash flow impact from higher capital expenditures related to the Natural Shrimp asset purchase.
Current report
During the three months ended March 31, 2026 and 2025, cash provided by financing activities was $691 thousand and $279 thousand, respectively. The increase is driven by $1.5 million related to the Streeterville Note, offset by $798 thousand of debt repayments and $11 thousand of lease payments.
Removed paragraphs (40)
Previous report
We have also developed patented software called GreenThumb that assists in tracking plants through our supply chain. Utilizing our GreenThumb software to track the status of our plants as they grow and move throughout the greenhouse allows us to add a layer of quality control due to the frequent monitoring of the growing process, leading to improved traceability. In this context, traceability means being able to track a plant through all stages of production and distribution. In addition to improving traceability, GreenThumb helps us better manage the day-to-day operations of our business. GreenThumb is a web-based greenhouse management and demand planning system that does the following:
Previous report
We also use our GreenThumb software to help monitor the quality of our products, and we have dedicated quality assurance and quality control personnel that check and monitor our products. We have customer service personnel that answer any questions the consumers of our products may have, and we regularly ask for feedback from our customers on the quality of our products. The combination of the GreenThumb software, quality assurance and control processes (including compliance with food safety standards), and feedback from consumers and purchasers holds us accountable for maintaining the quality of our products.
Previous report
We focus our efforts on producing our herbs and vegetables in a sustainable manner that will reduce consumption of natural resources, by recycling water in our closed loop system and using LED lights instead of conventional lightbulbs to accelerate crop growth and yield, when necessary. In addition, the inventory management component of GreenThumb allows us to manage inventory levels, order quantities and fill rates while maximizing truck loads. This means that we are better able to control shipping our products in full truck loads and retailer backhaul programs, thus eliminating multiple deliveries and decreasing the excess emission of greenhouse gases that would result from many partially full trucks delivering our products. Together, these elements of our production and distribution process are intended to reduce our carbon footprint, or the total amount of greenhouse gases that are generated by our actions, as compared with a legacy farm business.
Previous report
We believe our focus on our brand “Edible Garden” is a significant differentiator. The brand not only lends itself to our current portfolio of products but allows us to develop other products in the “Consumer Brands” category. Our focus on sustainability, traceability, and social contribution, which we define as an ongoing effort to improve employee relations, working conditions, and local communities, presents our value proposition to our customers and supermarket partners and distributors. We have recently leveraged our brand recognition to offer more consumer products that are in many cases co-manufactured, such as sauces, fermented products and flavor enhancers.
Previous report
Avondale Secured Promissory Note
Previous report
On August 29, 2025, we entered into a secured promissory note with Avondale Capital LLC (“Avondale”) pursuant to which we received $1,750,000 less an original issue discount of $350,000 and less $5,000 of fees and expenses, for net funds provided of $1,395,000. Pursuant to the Agreement, we are required to pay Avondale $43,750 weekly until the $1,750,000 secured promissory note with Avondale is paid in full. A portion of the net proceeds of the Avondale secured promissory note were used to satisfy the remaining amount to which Arin Funding LLC (“Arin”) was entitled under the standard merchant cash advance agreement we entered into with Arin on April 2, 2025 (the “Arin II Agreement”), which resulted in us recognizing a loss on extinguishment of $99,000.
Previous report
October 2025 Warrant Inducement
Previous report
On October 16, 2025, we entered into an inducement letter agreement (the “October Inducement Letter Agreement”) with an institutional investor and holder of existing warrants to purchase up to 2,021,571 shares of our common stock. The existing warrants were originally issued in May 2022, September 2023, and September and December 2024, with an exercise prices ranging from $75,000.00 to $3.50 per share, and became exercisable immediately following issuance. Pursuant to the October Inducement Letter Agreement, the holder agreed to exercise the existing warrants for cash at the exercise price of $2.06 per share in consideration for our agreement to issue a new unregistered warrant to purchase up to an aggregate of 4,043,142 shares of common stock at an exercise price of $2.06 per share. The new warrant was immediately exercisable upon issuance and has a term of five years from the issuance date.
Previous report
Acquisition
Previous report
The Company evaluates acquisitions to first determine whether a set of assets acquired constitutes a business and should be accounted for as a business combination. If the assets acquired are not a business, the transaction is accounted for as an asset acquisition in accordance with ASC 805-50, “Asset Acquisitions” which requires the acquiring entity to recognize assets acquired based on the cost to the acquiring entity on a relative fair value based on third-party appraisals. Goodwill is not recognized in an asset acquisition and any excess consideration transferred over the fair value of the net assets acquired is allocated to the identifiable assets based on relative fair values. The significant assets acquired include equipment and right-of-use lease assets.
Previous report
When acquiring leases in an asset acquisition, we retain the lease classification utilized by the seller if it was determined using acceptable methods under ASC 842* “Lease Accounting.”* As part of the allocation of the purchase price, lease terms are compared to market terms utilizing an income approach to determine if leases are favorable or unfavorable. Any favorable or unfavorable leasehold interests identified increase (favorable) or reduce (unfavorable) the right-of-use lease asset and are recognized over the life of the related right-of-use asset.
Previous report
Revenue was $2.8 million for the three months ended September 30, 2025, compared to $2.6 million for the three months ended September 30, 2024. The increase in revenue of $0.2 million, or 9%, was primarily attributed to strong performance across the company’s shelf-stable product lines including Kick.Sports Nutrition, Vitamin Whey, Pulp and Pickle Party. We believe the drag on revenue from our strategic exit from the floral and lettuce categories, is now behind us, and this quarter represents the strength of our repositioned portfolio.
Previous report
Cost of goods sold
Previous report
Cost of goods sold were $2.5 million for the three months ended September 30, 2025, compared to $1.9 million for the three months ended September 30, 2024. Cost of goods sold increased $0.7 million, or 37%. As a percentage of revenue, gross profit decreased to 10% from 27% for the three months ended September 30, 2025. The increase in cost of goods sold was primarily driven by increased greenhouse labor and freight costs of $433 thousand and increased purchases of raw materials related to our nutraceutical products, inclusive of late Q2 invoices received from a supplier in the amount of $135 thousand. We are pursuing price adjustments to mitigate the impact of these inflationary pressures on cost of goods sold.
Previous report
Selling, general and administrative
Previous report
Selling, general and administrative expenses (“SG&A”) were $3.8 million for the three months ended September 30, 2025, compared to $2.2 million for the three months ended September 30, 2024. SG&A increased $1.6 million, or 73%. The increase was primarily driven by higher depreciation expense related to the assets purchased from Natural Shrimp and associated right of use, legal, audit and accounting expenses.
Previous report
Interest expense was $0.4 million for the three months ended September 30, 2025, compared to $0.4 million for the three months ended September 30, 2024. Interest expense was approximately unchanged as a result of similar borrowing amounts and amortization of debt issuance costs.
Previous report
COMPARISON OF THE NINE MONTHS ENDED SEPTEMBER 30, 2025 AND 2024
Previous report
Revenue
Previous report
Revenue was $8.7 million for the nine months ended September 30, 2025, compared to $10.0 million for the nine months ended September 30, 2024. The decrease in revenue of $1.3 million, or 13%, is primarily attributed to our strategic exit from the floral and lettuce categories, which contributed $1.1 million of the decline year over year.
Previous report
Cost of goods sold
Previous report
Cost of goods sold were $7.7 million for the nine months ended September 30, 2025, compared to $7.7 million for the nine months ended September 30, 2024. Cost of goods sold was approximately the same for the two periods. As a percentage of revenue, gross profit decreased to 11% from 23% for the nine months ended September 30, 2025. The decrease was driven by inflationary pressures and higher labor costs related to production. We are working to mitigate cost pressures, assessing price adjustments and supplier negotiations where market conditions permit.
Previous report
Selling, general and administrative
Previous report
Selling, general and administrative expenses were $11.1 million for the nine months ended September 30, 2025, compared to $8.8 million for the nine months ended September 30, 2024. SG&A increased $2.3 million, or 26%. The increase was driven by transaction, professional and depreciation expenses related to the NaturalShrimp asset purchase, offset by the termination of severance payments related to the departure of the Company’s Chief Financial Officer in 2024.
Previous report
Loss from operations
Previous report
Loss from operations were $10.1 million for the nine months ended September 30, 2025, compared to $6.5 million for the nine months ended September 30, 2024. The increase in the loss from operations was driven by lower gross margin and higher SG&A expenses as previously described above.
Previous report
Interest expense
Previous report
Interest expense was $1.2 million for the nine months ended September 30, 2025, compared to $0.9 million for the nine months ended September 30, 2024. The increase was driven primarily by higher amortization of debt discount.
Previous report
Net loss
Previous report
On October 16, 2025, we entered into the October Inducement Letter Agreement with an institutional investor and holder of existing warrants to purchase up to 2,021,571 shares of our common stock for total proceeds of $4.2 million before deducting Maxim Group LLC’s (“Maxim”) fees and other offering expenses payable by the Company. See Note 15 “Subsequent Events.”
Previous report
On August 29, 2025, the Company entered into a secured promissory note with Avondale pursuant to which the Company received $1,750,000 less an original issue discount of $350,000 and less $5,000 of fees and expenses, for net funds provided of $1,395,000. Pursuant to the secured promissory note, the Company is required to pay Avondale $43,750 weekly until the $1,750,000 secured promissory note with Avondale is paid in full. A portion of the net proceeds of the Avondale secured promissory note were used to satisfy the remaining amount to which Arin was entitled under the Arin II Agreement.
Previous report
On May 21, 2025, we entered into an inducement letter agreement (the “Inducement Letter Agreement”) with an institutional investor and holder of existing warrants to purchase up to 999,600 shares of our common stock for total proceeds of $2.999 million. Maxim received an aggregate cash fee equal to 6.5% of the $3.5 million in total proceeds received from the exercise of the Existing Warrants exercised in connection with the Inducement Letter Agreement. See Note 10 “Stockholders’ Equity (Deficit) And Stock-Based Compensation.”
Previous report
On May 14, 2025, we entered into a stock purchase agreement (the “SPA”) with Streeterville Capital LLC (“Streeterville”), pursuant to which we issued 3,000 shares of Series B Preferred Stock, at a stated value of $1,000 per share, to Streeterville, for the purchase price of $3.0 million. Additionally, pursuant to the SPA, Streeterville shall purchase an additional 500 shares of Series B Preferred Stock, at a stated value of $1,000 per share, on November 14, 2025.
Previous report
On April 2, 2025, we entered into the Arin II Agreement with Arin, pursuant to which we agreed to sell $2.0 million of future accounts receivable to Arin in exchange for a purchase price of $1.5 million, less fees and expenses of $65 thousand, for net funds provided of $1.4 million. In connection with the Arin II Agreement, we negotiated with Cedar Advance LLC (“Cedar”) to discount the outstanding balance under the standard merchant cash advance agreement entered into with Cedar, dated as of December 4, 2024 (the “Cedar III Agreement”), from $1.4 million to $1.3 million, in exchange for us agreeing to prepay the future amounts payable under the Cedar III Agreement. A portion of the net proceeds of the Arin II Agreement were used to satisfy the remaining amount to which Cedar was entitled under the Cedar III Agreement. Weekly, we are required to pay Arin 20.0% of all funds collected from customers for the sale of goods and services and Arin is authorized to withdraw $63,750 of funds from our bank account until the total balance of $2.0 million is repaid.
Previous report
On February 14, 2025, we entered into the Arin I Agreement with Arin, pursuant to which the Company sold to Arin $272 thousand of its future accounts receivable for a purchase price of $200 thousand, less fees and expenses of $10,000, for net funds provided of $190 thousand. Pursuant to the Arin I Agreement, the Company is required to pay Arin 10.0% of all funds collected weekly from customers and Arin is expected to withdraw $9,714 a week directly from the Company’s bank account until the $272 thousand due to Arin under the Arin I Agreement is paid in full.
Previous report
On February 12, 2025, we advanced the Narayan d.o.o. and its subsidiaries (the “Narayan Group”) $193 thousand to support its operations and the Narayan Group issued a promissory note in favor of us in the principal amount of $190 thousand. On February 19, 2025, we agreed to advance Narayan Group an additional $199 thousand that was to be paid in weekly installments and the Narayan Group issued a promissory note in favor of us in the principal amount of $199 thousand (the “second promissory note”). On June 3, 2025, we announced the decision not to proceed with the transaction contemplated under the letter of intent to purchase outstanding shares of Narayan Group and negotiations ceased. Prior to our decision not to proceed with the transaction, we had advanced the Narayan Group $100 thousand under the second promissory note. The promissory notes accrued interest at a rate of 6.0% per annum until June 30, 2025, after which interest accrues at a rate of 10.0% per annum because the parties have not entered into a definitive agreement with respect to the proposed transaction. The Narayan Group is obligated to pay the outstanding principal and accrued interest in 12 equal monthly installments beginning on July 1, 2025. To date, the Narayan Group has not paid amounts due under the promissory notes and has defaulted on the repayment of the promissory notes.
Previous report
On January 31, 2025, we entered into an Equity Distribution Agreement (the “2025 EDA”) with Maxim, as sales agent, pursuant to which the Company may, from time to time, issue and sell shares of its common stock through Maxim in an at-the-market offering for an aggregate offering price of up to $2.5 million. To date, we have received net proceeds of approximately $1.759 million from the sale of common stock under the 2025 EDA after deducting Maxim’s commission of 3.5% of the gross proceeds and other offering expenses.
Previous report
During the nine months ended September 30, 2025 and 2024, cash used for operating activities was $9.1 million and $6.8 million, respectively. The increase in cash used for operating activities was primarily driven by the increase in net loss and the reduction in accounts payable, and an increase in prepaid expense and other current assets.
Previous report
During the nine months ended September 30, 2025 and 2024, cash used in investing activities was $0.5 million and $0.2 million, respectively. The decrease in cash used in investing activities is attributable to lower normal course of business purchases of property, equipment and leasehold improvements.
Previous report
During the nine months ended September 30, 2025 and 2024, cash provided by financing activities was $7.0 million and $8.6 million, respectively. The $1.6 million decrease in cash provided by financing activities was due to our repayment of outstanding debt and the lack of any public offerings of stock in 2025 as compared to 2024, offset by higher financing cash flows related to our May 2025 warrant inducement, the sale of $3.0 million of our preferred stock and higher cash flows from our 2025 equity distribution agreement.
Reworded paragraphs (12)
Previous wording
In addition to historical information, this Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), which provides a “safe harbor” for forward-looking statements made by us. All statements, other than statements of historical facts, including statements concerning our plans, objectives, goals, beliefs, business strategies, future events, business conditions, results of operations, financial position, business outlook, business trends, and other information, may be forward-looking statements. Words such as “believe,” “can,” “continue,” “could,” “estimate,” “expect,” “future,” “intend,” “may,” “might,” “plan,” “potential,” “should,” “will,” “would,” and variations of such words or similar expressions are intended to identify forward-looking statements. The forward-looking statements are not historical facts, and are based upon our current expectations, beliefs, estimates and projections, and various assumptions, many of which, by their nature, are inherently uncertain and beyond our control. Our expectations, beliefs, estimates, and projections are expressed in good faith and we believe there is a reasonable basis for them. However, there can be no assurance that our expectations, beliefs, estimates, and projections will occur or can be achieved. Actual results may vary materially from what is expressed in or indicated by the forward-looking statements.
Current wording
In addition to historical information, this Quarterly Report on Form 10-Q contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), which provides a “safe harbor” for forward-looking statements made by us. All statements, other than statements of historical facts, including statements concerning our plans, objectives, goals, beliefs, business strategies, future events, business conditions, results of operations, financial position, business outlook, business trends, and other information, may be forward-looking statements. Words such as “anticipate,” “believe,” “can,” “continue,” “could,” “estimate,” “expect,” “future,” “intend,” “may,” “might,” “potential,” “projections,” “should,” “will,” “would,” and variations of such words or similar expressions are intended to identify forward-looking statements. The forward-looking statements are not historical facts, and are based upon our current expectations, beliefs, estimates and projections, and various assumptions, many of which, by their nature, are inherently uncertain and beyond our control. Our expectations, beliefs, estimates, and projections are expressed in good faith and we believe there is a reasonable basis for them. However, there can be no assurance that our expectations, beliefs, estimates, and projections will occur or can be achieved. Actual results may vary materially from what is expressed in or indicated by the forward-looking statements.
Previous wording
We are a controlled environment agriculture (“CEA”) farming company. We use traditional agricultural growing techniques together with technology to grow fresh, organic food, sustainably and safely while improving traceability. We use the controlled environment of traditional greenhouse structures, such as glass greenhouses, together with hydroponic and vertical greenhouses to sustainably grow organic herbs. In our hydroponic greenhouse, we grow plants without soil. Instead of planting one row of plants in the ground, by using vertical growing systems, we can grow many towers of herbs in the same area by planting up instead of planting across. Growing these products sustainably means that we avoid depleting natural resources in order to maintain an ecological balance, such as by renewing, reusing and recycling materials in order to lower the overall one-time use of materials.
Current wording
We are a controlled environment agriculture ("CEA") farming company. We use traditional agricultural growing techniques together with technology to grow fresh, organic food sustainably and safely while improving traceability. We operate glass, hydroponic, and vertical greenhouse structures that enable us to grow organic herbs consistently year-round while using less land, less energy, and less water than conventional agriculture. In our hydroponic greenhouse, we grow plants without soil. Instead of planting one row of plants in the ground, by using a vertical growing system, we can grow many towers of plants in the same area by planting up instead of planting across. Growing these products sustainably means that we avoid depleting natural resources in order to maintain an ecological balance, such as by renewing, reusing and recycling materials in order to lower the overall one-time use of materials.
Previous wording
Our controlled greenhouse facilities allow us to grow consistent quality herbs year-round, first by eliminating some of the variability of outdoor farming with our CEA techniques, and second by leveraging our proprietary software, GreenThumb. In addition to using hydroponic and vertical greenhouse systems, we use a “closed loop” system in our greenhouses. Generally, in a “closed loop” system, drain water is recollected and reused for irrigation. In our closed loop system, we also cycle water back into the system that has been collected through reverse osmosis. When compared with conventional agriculture, our closed looped systems and hydroponic methods use less land, less energy and less water (than legacy farms), thus conserving some of the planet’s limited natural resources. Our advanced systems are also designed to help mitigate contamination from harmful pathogens, including salmonella, e-coli and others.
Current wording
Our facilities utilize "closed loop" irrigation systems that recollect and reuse drain water—including water recycled through reverse osmosis—reducing overall water consumption and helping conserve natural resources. Our advanced systems are also designed to help mitigate contamination from harmful pathogens, including salmonella, e-coli and others.
Previous wording
The most significant accounting estimates involve a high degree of judgment or complexity. Management believes the estimates and judgments most critical to the preparation of our condensed consolidated financial statements and to the understanding of our reported financial results include the following.
Current wording
The most significant accounting estimates involve a high degree of judgment or complexity. Management believes the estimates and judgments most critical to the preparation of our condensed consolidated financial statements and to the understanding of our reported financial results include allowance for doubtful accounts. The following are the accounting estimates most critical to the preparation of our condensed consolidated financial statements.
Previous wording
Revenue is recognized when control of the promised goods or services is transferred to the Company’s customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services.
Current wording
Revenues are recognized when control of the promised goods or services is transferred our customers, in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services.
Previous wording
We recognize uncertain tax positions based on a benefit recognition model. Provided that the tax position is deemed more likely than not of being sustained, the Company recognizes the largest amount of tax benefit that is greater than 50.0% likely of being ultimately realized upon settlement. The tax position is derecognized when it is no longer more likely than not of being sustained. The Company classifies income tax related interest and penalties as interest expense and selling, general and administrative expense, respectively, on the consolidated statements of operations.
Current wording
We recognize uncertain tax positions based on a benefit recognition model. Provided that the tax position is deemed more likely than not of being sustained, we recognize the largest amount of tax benefit that is greater than 50.0% likely of being ultimately realized upon settlement. The tax position is derecognized when it is no longer more likely than not of being sustained. We classify income tax related interest and penalties as interest expense and selling, general and administrative expense, respectively, on the consolidated statements of operations.
Previous wording
Loss from operations were $3.6 million for the three months ended September 30, 2025, compared to $1.5 million for the three months ended September 30, 2024. The increase in the loss from operations was driven by lower gross margin and higher SG&A expenses as previously described above.
Current wording
Loss from operations were $6.7 million for the three months ended March 31, 2026, compared to $2.9 million for the three months ended March 31, 2025. The increase in the loss from operations was driven by higher overall expenses across cost of goods sold and depreciation expense, partially offset by an increase in revenue.
Previous wording
Net loss was $4.0 million for the three months ended September 30, 2025, compared to a net loss of $2.1 million for the three months ended September 30, 2024. The reasons for the increase in net loss are explained above.
Current wording
Net loss was $3.7 million for the three months ended March 31, 2026, compared to a net loss of $3.3 million for the three months ended March 31, 2025. The reasons for the decrease in net loss are explained above.
Previous wording
We have incurred significant losses since our inception. We recognized net losses of approximately $11.4 million during the nine months ended September 30, 2025 and $11.1 million during the twelve months ended December 31, 2024. We expect our capital expenses and operational expenses to increase in the future due to expected increased sales and marketing expenses, operational costs, and general and administrative costs. Therefore, we believe our operating losses will continue or even increase at least through the near term.
Current wording
We have incurred significant losses since our inception. We recognized net losses of approximately $3.7 million during the three months ended March 31, 2026 and $17.3 million during the year ended December 31, 2025. We expect our capital expenses and operational expenses to increase in the future due to expected increased sales and marketing expenses, operational costs, and general and administrative costs. Therefore, we believe our operating losses will continue or even increase at least through the near term.
Previous wording
The risks and uncertainties surrounding our ability to continue our business with limited capital resources raises substantial doubt as to our ability to continue as a going concern for twelve months from the issuance of these financial statements. To date, we have financed our operations with the proceeds from debt financings, public and private securities offerings, and operations, among other sources. If we are unable to raise additional capital, we believe that our existing cash will fund operations into the second quarter of 2026 and will not be sufficient to fund our operations through the next twelve months beyond the date of the issuance of our consolidated financial statements. Our operations have consumed substantial amounts of cash since inception. The net cash used in operating activities was $9.1 million and $6.8 million during the nine months ended September 30, 2025 and 2024, respectively. Our consolidated financial statements do not include any adjustments that might result if we are unable to continue as a going concern. If we are unable to continue as a going concern, holders of our securities might lose their entire investment. These factors, among others, may make it difficult to raise any additional capital and may cause us to be unable to continue to operate our business.
Current wording
The risks and uncertainties surrounding our ability to continue our business with limited capital resources raises substantial doubt as to our ability to continue as a going concern for twelve months from the issuance of these financial statements. To date, we have financed our operations with the proceeds from debt financings, public and private securities offerings, and operations, among other sources. If we are unable to raise additional capital, we believe that our existing cash will fund operations into the third quarter of 2026 and will not be sufficient to fund our operations through the next twelve months beyond the date of the issuance of our consolidated financial statements. Our operations have consumed substantial amounts of cash since inception. The net cash provided by (used in) operating activities was $251 thousand and ($3.3) million during the three months ended March 31, 2026 and 2025, respectively. Our financial statements have been prepared on a “going concern” basis. However, substantial doubt exists regarding our ability to continue as a going concern for the next twelve months. Our consolidated financial statements do not include any adjustments that might result if we are unable to continue as a going concern. If we are unable to continue as a going concern, holders of our securities might lose their entire investment. These factors, among others, may make it difficult to raise any additional capital and may cause us to be unable to continue to operate our business.
Previous wording
The Company’s primary liquidity requirements are for working capital, continued investments in capital expenditures, repayment of indebtedness, payment of the preferred return to the holder of our Series B Preferred Stock, par value $0.0001 per share (the “Series B Preferred Stock”), and other strategic investments. Although income taxes are not currently a significant use of funds, after the benefits of our net operating loss carryforwards are fully recognized, they could become a material use of funds, depending on our future profitability and future tax rates. The Company’s liquidity needs have been met primarily through public and private equity offerings, term loan borrowings, accounts receivable financing, convertible notes, and related party loans.
Current wording
Our primary liquidity requirements are for working capital, continued investments in capital expenditures, repayment of indebtedness, and other strategic investments. Although income taxes are not currently a significant use of funds, after the benefits of our net operating loss carryforwards are fully recognized, they could become a material use of funds, depending on our future profitability and future tax rates. Our liquidity needs have been met primarily through public equity offerings, term loan borrowings, accounts receivable financing, convertible notes, and related party loans.
Previous wording
As of September 30, 2025 and December 31, 2024, we had $0.8 million and $3.5 million in cash and cash equivalents available, respectively. As of September 30, 2025 and December 31, 2024, we had $2.7 million and $3.2 million of total gross debt outstanding, respectively. During the nine months ended September 30, 2025, we used $9.1 million in cash for operating activities. As of September 30, 2025, we had a working capital deficit of $1.2 million, a decrease of approximately $2.4 million from a working capital surplus of $1.2 million as of December 31, 2024. To meet our cash needs, during the nine months ended September 30, 2025, we raised $3.3 million via the May warrant inducement, we raised $3.0 million from the sale of preferred stock, we entered into the Arin II Agreement and the Avondale secured promissory note, we raised approximately $2.3 million in an at-the-market offerings, and subsequent to September 30, 2025, we raised an additional $4.2 million via the October warrant inducement. We are also continuing to assess our cost structure for opportunities. See “Capital Resources” below for additional details.
Current wording
As of March 31, 2026 and December 31, 2025, we had $2.0 million and $1.1 million in cash and cash equivalents available, respectively. During the three months ended March 31, 2026, cash provided by operating activities was $251 thousand. As of March 31, 2026 and December 31, 2025, we had $2.7 million and $1.9 million of total debt outstanding, respectively.
Rearranged previous paragraphs (1)
Previous report — wording carried elsewhere
Net loss was $11.4 million for the nine months ended September 30, 2025, compared to a net loss of $8.0 million for the nine months ended September 30, 2024. The reasons for the increase in net loss are explained above