Axil Brands, Inc.
For the period ended Aug 31, 2025. Filed Oct 7, 2025.
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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.
Aug 31, 2025 · Filed Oct 7, 2025
AXIL$5.16-0.6%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-02-28; filed 2025-04-08.
0001520138-25-000113
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-08-31; filed 2025-10-07.
0001520138-25-000299
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 51 previous paragraphs and 49 current paragraphs.
15 unchanged; 12 reworded; 22 added; 24 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 2 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 (22)
Current report
The Company entered into a strategic supply arrangement with a leading national membership-based retail chain, marking a significant milestone in our wholesale channel expansion strategy. Under this agreement, the retailer placed a substantial initial purchase order, with fulfillment beginning in the first quarter of fiscal 2026 and expected to be completed in the second quarter of fiscal 2026. While there can be no assurances that additional purchase orders will be placed or as to the timing of the fulfillment of any orders, this development has and is anticipated to continue to drive meaningful revenue growth and enhance brand visibility across a broader customer base.
Current report
In September 2025, we announced a partnership with a major national salon chain across Canada to offer our full Reviv3 Procare® line, a collaboration that significantly expands our brand’s professional reach through one of the country’s most influential haircare networks.
Current report
In June 2025, the Company expanded its leadership team by hiring a senior contractor to lead growth initiatives in our hair and skin care division. This individual brings extensive experience in brand development and channel expansion. His appointment reflects our commitment to scaling this business segment and capitalizing on emerging industry growth.
Current report
We also gained media recognition in leading military publications, includingMilitary Times, Air Force Times, Marine Corps Times, andNavy Times, highlighting our hearing protection and enhancement technology. We believe this visibility strengthens our credibility among professional and tactical users.
Current report
We continue to make progress on our supply chain transition strategy in response to elevated U.S. tariffs and broader geopolitical risks. Key initiatives include relocating senior manufacturing leadership to the United States and advancing early-stage domestic production capabilities. While tariff-related cost pressures impacted fiscal 2025, we do not expect a material ongoing effect into fiscal 2026 based on current tariff levels. If tariff rates change or other changes in trade policy are implemented, the expected impact on our operations could change.
Current report
On July 4, 2025, legislation commonly referred to as The One Big Beautiful Bill Act of 2025 (“OBBBA”) was enacted in the U.S., making permanent certain provisions of the Tax Cuts and Jobs Act and introducing changes to corporate tax provisions. We are currently assessing the impact of OBBBA on our consolidated financial statements.
Current report
Net sales for the three months ended August 31, 2025 increased by $1,004,946 or 17.2%, as compared to the three months ended August 31, 2024. The increase in net sales was primarily driven by a material order from a leading national membership-based retail chain. The order generated significant incremental revenue and positioned us for additional shipments in subsequent periods.
Current report
Gross profit increased by $481,286 or 11.6% from $4,153,648 in the three months ended August 31, 2024 to $4,634,934 for the three months ended August 31, 2025. Gross profit as a percentage of sales for the three months ended August 31, 2025 was 67.6%, as compared to 71.0% for the three months ended August 31, 2024 Gross profit increased due to higher sales volumes, partially offset by lower margins related to a material order with a leading national membership-based retail chain.
Current report
Operating expenses decreased by $71,154 or 1.7% from $4,294,350 in the three months ended August 31, 2024 to $4,223,196 in the three months ended August 31, 2025. Operating expenses as a percentage of net revenues for the three months ended August 31, 2025 was 61.6% compared to 73.4% for the three months ended August 31, 2024. Included in operating expenses were non-cash stock-based compensation of $199,212 and $297,864 in the three months ended August 31, 2025 and 2024, respectively. The decrease in operating expenses was primarily driven by lower professional and consulting fees, reflecting reduced reliance on external consultants as part of our efforts to enhance operating efficiency.
Current report
Basic and diluted earnings per share for the three months ended August 31, 2025 were $0.05 and $0.04, respectively, compared to basic and diluted loss per share of $0.02 for the three months ended August 31, 2024.
Current report
We are currently engaged in product sales and development. Although we have experienced operating losses in prior periods, we expect to continue generating net income and positive cash flow in the fiscal year ending May 31, 2026. Based on our current cash balances and anticipated operating cash flows, we believe we have sufficient liquidity to meet working capital needs for at least one year from the issuance date of the accompanying consolidated financial statements.
Current report
We plan to manage expenses relative to expected revenue and may reinvest near-term cash to support revenue growth. In recent years, we have generated sufficient cash to support our operations and required debt payments, and we expect this to continue, although we cannot provide any assurance. Management remains focused on expanding product lines and our customer base to drive revenue. However, future cash demands may exceed historical levels. If needed, we may seek additional capital, although there is no assurance that financing will be available on acceptable terms or at all. Subject to these uncertainties, we believe we have sufficient capital and liquidity to fund operations for at least one year from the issuance date of the accompanying consolidated financial statements.
Current report
Cash Flows for the three months ended August 31, 2025 and 2024
Current report
Net cash used in operating activities for the three months ended August 31, 2025, was $739,194, compared to net cash provided by operating activities of $897,318 for the three months ended August 31, 2024. The decrease was related to a material order from a leading national membership-based retail chain, which we began fulfilling in the first quarter of fiscal 2026 and we expect to complete in the second quarter of fiscal 2026. This resulted in a significant inventory purchase, and a material increase in accounts receivable, as the order was placed near the end of the quarter.
Current report
Significant Accounting Policies and Estimates
Current report
Significant accounting policies and practices are those that are both most important to the portrayal of the Company’s financial condition and results, and require management’s most difficult, subjective, or complex judgments, often as a result of the need to make estimates.
Current report
Accounts receivable and allowance for credit losses
Current report
The Company has a policy of providing an allowance for credit losses based on its best estimate of the amount of probable credit losses in its existing accounts receivable. The Company periodically reviews its accounts receivable to determine whether an allowance is necessary based on an analysis of past due accounts and other factors that may indicate that the realization of an account may be in doubt. Account balances deemed to be uncollectible are charged to bad debt expense and included in the allowance after all means of collection have been exhausted and the potential for recovery is considered remote.
Current report
Revenue recognition
Current report
We recognize revenue in accordance with ASC 606,Revenue from Contracts with Customers. Revenue is recognized when control of the product is transferred to the customer, typically upon shipment. In determining the transaction price, we consider discounts, promotional incentives, and expected returns. These estimates require judgment based on historical experience and current market conditions. Changes in customer behavior or promotional strategies could impact the timing and amount of revenue recognized.
Current report
Goodwill
Current report
Goodwill represents the excess of the consideration paid over the fair value of net assets acquired in a business combination. We evaluate goodwill for impairment at least annually during the fourth quarter, or more frequently if circumstances or events suggest potential impairment. Throughout the year, we monitor for indicators that might trigger an interim impairment review. Our testing may begin with a qualitative assessment to determine whether it is more likely than not that the fair value of a reporting unit exceeds its carrying value. If a quantitative test is performed, fair value is estimated based on the amount a market participant would pay in a hypothetical sale of the reporting unit. When the fair value exceeds the carrying value, goodwill is considered to be not impaired. If the carrying value exceeds fair value, an impairment charge is recorded for the amount of the excess, limited to the total carrying amount of goodwill.
Removed paragraphs (24)
Previous report
In addition, the Company is exploring options for its hair care and skin care business, which could result in the divestiture of such business. Any such divestiture may not occur in a timely manner, or at all, and the Company may not be able to realize any benefits from any strategic actions it may engage in with respect to its hair care and skin care business.
Previous report
Business Update
Previous report
In light of recent changes to U.S. trade policy, including the imposition of elevated tariffs on certain imported goods, AXIL has accelerated its previously initiated supply chain transition strategy. While we have historically relied on international suppliers for the majority of our manufacturing operations, we began proactively evaluating alternative strategies in anticipation of these risks.
Previous report
To strengthen our long-term operational flexibility and reduce exposure to geopolitical volatility, we have initiated the relocation of senior manufacturing leadership to the United States. This relocation is part of a broader initiative to establish domestic manufacturing capabilities, including the setup of new production facilities. These efforts are expected to improve both cost stability and responsiveness to customer demand over time.
Previous report
Although we anticipate some increase in product costs in the near term as a result of these tariffs, we believe our current inventory levels and ongoing mitigation strategies position us to navigate this period with minimal disruption. We are continuing to evaluate a range of strategic options to manage these cost pressures, including supply chain optimization, pricing strategies, and sourcing adjustments. We believe we will be able to adapt to the evolving trade environment and believe the actions we are taking now will enhance our resilience and competitiveness in the medium and long term.
Previous report
Net sales for the three months ended February 28, 2025 and February 29, 2024 were $6,922,367 and $6,469,343, respectively. Net sales for the three months ended February 28, 2025 increased by $453,024 or 7.0%, as compared to the three months ended February 29, 2024. The increase in sales was primarily attributable to an increase in direct-to-consumer sales that was significantly affected by the shift of post-Thanksgiving holidays falling in the third quarter in fiscal year 2025. Furthermore, we strengthened our distribution channels of AXIL products, expanded our presence in new geographic regions, and increased distributor sales of our hair and skin care products.
Previous report
For the three months ended February 28, 2025, the overall cost of sales increased by $110,922 or 6.0%, as compared to the three months ended February 29, 2024, which was primarily due to the strengthening of our distribution channels in both segments of our business. Cost of sales as a percentage of net revenues for the three months ended February 28, 2025 was 28.3% as compared to 28.5% for the three months ended February 29, 2024.
Previous report
Gross profit for the three months ended February 28, 2025 and February 29, 2024 was $4,966,428 and $4,624,326, respectively. Gross profit as a percentage of sales for the three months ended February 28, 2025 was 71.7%, as compared to 71.5% for the three months ended February 29, 2024.
Previous report
Operating expenses consisted of marketing and selling expenses, compensation and related taxes, professional and consulting fees, and general and administrative costs. Operating expenses decreased by $344,886 or 7.3% from $4,728,205 in the three months ended February 29, 2024 to $4,383,319 in the three months ended February 28, 2025. Operating expense as a percentage of revenue for the three months ended February 28, 2025 was 63.3% compared 73.1% for the three months ended February 29, 2024. Included in operating expenses were non-cash stock-based compensation of $258,053 and $59,099 in the three months ended February 28, 2025 and three months ended February 29, 2024, respectively. The decrease in operating expenses related primarily to lower advertising costs, as we move to a more targeted and efficient approach of advertising for direct-to-consumer sales channels and improve reliance on our distribution channels. During the three months ended February 28, 2025, we incurred approximately $195,000 in consulting fees to support our expansion into new geographic markets, compared to $0 for the same period in 2024. Of this amount, approximately $116,000 was related to stock-based compensation. We have also incurred additional costs related to new product lines. We believe we have not yet realized the anticipated benefits from our recent efforts to expand into new geographic markets and product lines.
Previous report
Adjusted EBITDA increased by $901,598 to $890,546 for the three months ended February 28, 2025 from an Adjusted EBITDA loss of $11,052 for the three months ended February 29, 2024. The increase of Adjusted EBITDA related to increased sales in both our direct-to-consumer channels as well as our distribution channels. Adjusted EBITDA as a percentage of sales, net for the three months ended February 28, 2025 and February 29, 2024, was 12.9% and (0.2)%, respectively.
Previous report
For the Nine Months Ended February 28, 2025 Compared to the Nine Months Ended February 29, 2024
Previous report
Net sales for the nine months ended February 28, 2025 and nine months ended February 29, 2024 were $20,506,213 and $20,997,289, respectively. Net sales for the nine months ended February 28, 2025 decreased by $491,076 or 2.3%, as compared to the nine months ended February 29, 2024. This decrease was primarily due to reduced advertising expenditure which adversely affected direct to consumer sales in the first and second quarters of the fiscal year offset by the strong performance of the third quarter.
Previous report
Gross profit for the nine months ended February 28, 2025 and February 29, 2024 was $14,618,123 and $15,529,831, respectively. Gross profit as a percentage of sales for the nine months ended February 28, 2025 was 71.3%, as compared to 74.0% for the nine months ended February 29, 2024. The decrease in the gross profit margin for the nine months ended February 28, 2025 was primarily attributable to an increase in cost of sales as a percentage of revenue, and an increase in discounts as a percentage of revenue.
Previous report
Operating expenses consisted of marketing and selling expenses, compensation and related taxes, professional and consulting fees, and general and administrative costs. Operating expenses decreased by $693,196 or 4.9% from $14,196,041 in the nine months ended February 29, 2024 to $13,502,845 in the nine months ended February 28, 2025. Operating expenses as a percentage of net revenues for the nine months ended February 28, 2025 was 65.8% compared to 67.6% for the nine months ended February 29, 2024. Included in operating expenses were non-cash stock-based compensation of $860,517 and $161,314 in the nine months ended February 28, 2025 and February 29, 2024, respectively. The decrease in operating expenses related primarily to a net decrease in advertising expenses, and a forgiveness of account payable amounting to approximately $220,000 partially offset by an increase of stock-based compensation of $699,203 and increased professional and consulting fees. During the nine months ended February 28, 2025, we incurred approximately $395,000 in consulting fees to support our expansion into new geographic markets, compared to $0 for the same period in 2024. Of this amount, approximately $195,000 was related to stock-based compensation. We have also incurred additional costs related to new product lines. We believe we have not yet realized the anticipated benefits from our recent efforts to expand into new geographic markets and product lines.
Previous report
Income from operations for the nine months ended February 28, 2025, was $1,115,278 compared to income of $1,333,790 for the nine months ended February 29, 2024. The decrease in income from operations of $218,512 or 16.4% was primarily related to an increase in our non-cash stock-based compensation.
Previous report
For the nine months ended February 28, 2025, provision for income tax expense was $120,335. For the nine months ended February 29, 2024, income tax benefit was $397,054.
Previous report
As a result of the above, and a gain on settlement of debt of approximately $79,000 in the prior year period that did not recur in the current period, we reported a net income of $1,100,563 and $1,953,618 for the nine months ended February 28, 2025 and February 29, 2024, respectively.
Previous report
We are currently engaged in product sales and development. Although we earned net income and have cash provided by operations for the nine months ended February 28, 2025, we have incurred operating losses in the past. We currently expect to earn net income and positive cash flows from operations during the current fiscal year ending May 31, 2025. We believe our current cash balances, coupled with anticipated cash flow from operating activities, will be sufficient to meet our working capital requirements for at least one year from the date of issuance of the accompanying unaudited consolidated financial statements. We intend to continue to control our cash expenses as a percentage of expected revenue on an annual basis and thus may use our cash balances in the short-term to invest in revenue growth. As a result of the acquisition of AXIL & Associated Brands’ assets in June 2022, we have generated and expect we will continue to generate sufficient cash for our operational needs, including any required debt payments, for at least one year from the date of issuance of the accompanying unaudited consolidated financial statements. Management is focused on growing the Company’s existing product lines and introducing new products, as well as expanding its customer base, to increase its revenues. The Company cannot give assurance that it can increase its cash balances or limit its cash consumption and thus maintain sufficient cash balances for its planned operations or future acquisitions. Future business demands may lead to cash utilization at levels greater than recently experienced. The Company cannot provide any assurance that it will be able to raise additional capital or obtain necessary financing on acceptable terms, or at all. Subject to the foregoing, management believes that the Company has sufficient capital and liquidity to fund its operations for at least one year from the date of issuance of the accompanying unaudited consolidated financial statements.
Previous report
Cash Flows
Previous report
Net cash provided by operating activities for the nine months ended February 28, 2025, was $1,734,230, compared to $339,323 for the nine months ended February 29, 2024. This improvement primarily resulted from our strategic decision to increase inventory levels as of May 31, 2024 to accommodate new product variations and packaging aimed at expanding into new markets. Inventory sold during the nine months ended February 28, 2025 contributed positively to cash flows. We also negotiated a forgiveness of accounts payable during the nine months ended February 28, 2025, resulting in an improvement of operating cash flows of approximately $220,000 offset by timing of net changes in operating assets and liabilities excluding inventory.
Previous report
Critical Accounting Policies
Previous report
The preparation of condensed consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires us to make a number of estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements. Such estimates and assumptions affect the reported amounts of expenses during the reporting period. On an ongoing basis, we evaluate estimates and assumptions based upon historical experience and various other factors and circumstances. We believe our estimates and assumptions are reasonable in the circumstances; however, actual results may differ from these estimates under different future conditions.
Previous report
We believe that the estimates and assumptions that are most important to the portrayal of our financial condition and results of operations, in that they require the most difficult, subjective or complex judgments, form the basis for the accounting policies deemed to be most critical to us. These critical accounting policies relate to revenue recognition, impairment of intangible assets and long-lived assets, inventory, stock compensation, and evaluation of contingencies. We believe estimates and assumptions related to these critical accounting policies are appropriate under the circumstances; however, should future events or occurrences result in unanticipated consequences, there could be a material impact on our future financial condition or results of operations.
Previous report
See the footnotes to our unaudited consolidated financial statements for the three and nine months ended February 28, 2025, included with this Quarterly Report on Form 10-Q for additional discussion of our critical accounting policies and use of estimates.
Reworded paragraphs (12)
Previous wording
The Company has two reportable segments: hair care and skin care, and hearing enhancement and protection.
Current wording
We have two reportable segments: hair and skin care, and hearing enhancement and protection. In addition, we have recently incorporated a wholly owned subsidiary with the intent to offer marketing services. This new subsidiary is expected to support third-party clients by leveraging our direct-to-consumer expertise to deliver performance-driven marketing solutions.
Previous wording
Through our hearing enhancement and protection segment, we design, innovate, engineer, manufacture, market and service specialized systems in hearing enhancement, hearing protection, wireless audio, and communication. Through our hair care and skin care segment, we manufacture, market, sell, and distribute professional quality hair and skin care products.
Current wording
Through our hearing enhancement and protection segment, we design, innovate, engineer, manufacture, market and service specialized systems in hearing enhancement, hearing protection, wireless audio, and communication. Through our hair and skin care segment, we manufacture, market, sell, and distribute professional quality hair and skin care products.
Previous wording
The Company’s overall business strategy is to establish market awareness of our products through our direct-to-consumer campaigns. The Company’s strategy centers on driving growth by expanding market share within existing channels and developing new ones through both online and traditional platforms. The Company’s primary focus is optimizing its e-commerce strategies, building sales teams to meet the needs of distribution channels, and enhancing value through strategic partnerships. The Company is also working to expand its offline retail presence and enter into new international markets. We believe the increase in awareness will allow us to increase distribution and gain customers through our distribution partners’ retail establishments, with the goal of helping us achieve growth in market share and diversify our sales channels; however, we cannot provide any assurances that such increases will occur, or that we will realize the anticipated benefits of our actions.
Current wording
Our overall business strategy is to establish market awareness of our products through our direct-to-consumer campaigns. Our strategy centers on driving growth by expanding market share within existing channels and developing new ones through both online and traditional platforms. Our primary focus is optimizing our e-commerce strategies, building sales teams to meet the needs of distribution channels, and enhancing value through strategic partnerships. We are also working to expand our offline retail presence and enter into new international markets. We believe the increase in awareness will allow us to increase distribution and gain customers through our distribution partners’ retail establishments, with the goal of helping us achieve growth in market share and diversify our sales channels; however, we cannot provide any assurances that such increases will occur, or that we will realize the anticipated benefits of our actions.
Previous wording
For the nine months ended February 28, 2025, the overall cost of sales increased by $420,632 or 7.7%, as compared to the nine months ended February 29, 2024. Cost of sales as a percentage of net revenues for the nine months ended February 28, 2025 was 28.7% as compared to 26.0% for the three months ended February 29, 2024. The increase in cost of sales, as a percentage of sales, was primarily attributable to an increase in sales to distributors in both our hair and skin care products and our hearing enhancement and protection segment, bearing lower margins.
Current wording
Cost of sales includes the cost of products, freight-in costs, and depreciation related to fixed assets that are used in the production and distribution process to bring goods to their saleable condition and location. For the three months ended August 31, 2025, the overall cost of sales increased by $523,660 or 30.8%, as compared to the three months ended August 31, 2024. Cost of sales as a percentage of net revenues for the three months ended August 31, 2025 was 32.4% as compared to 29.0% for the three months ended August 31, 2024. Cost of sales increased as a percentage of revenue primarily due to a material order with a leading national membership-based retail chain, which carried tighter margins compared to our direct-to-consumer business.
Previous wording
Income from operations for the three months ended February 28, 2025 was $583,109 compared to a loss from operations of $103,879 for the three months ended February 29, 2024. The increase in income from operations of $686,988 was primarily related to increased sales in both our direct-to-consumer channels as well as our distribution channels, partially offset by an increase in stock-based compensation.
Current wording
Income from operations for the three months ended August 31, 2025, was $411,738 compared to a loss from operations of $140,702 for the three months ended August 31, 2024. The increase in income from operations of $552,440 or 392.6% was primarily related to the increase in unit sales and the resulting contribution to gross profit, in addition to gained efficiencies within the Company resulting in reduced operating expenses.
Previous wording
For the three months ended February 28, 2025 provision for income taxes was $53,085. For the three months ended February 29, 2024, we had an income tax benefit of $827,436.
Current wording
For the three months ended August 31, 2025, provision for income tax expense was $115,058. For the three months ended August 31, 2024, we had an income tax of $0.
Previous wording
As a result of the above, we reported a net income of $576,662 and a net income of $781,091 for the three months ended February 28, 2025 and February 29, 2024, respectively.
Current wording
As a result of the above, we reported a net income of $334,294 and net loss of $109,805 for the three months ended August 31, 2025 and 2024, respectively.
Previous wording
Adjusted EBITDA increased by $399,763, or 23.8% from $1,677,058 for the nine months ended February 29, 2024 to $2,076,821 for the nine months ended February 28, 2025. Adjusted EBITDA as a percentage of sales, net for the nine months ended February 28, 2025 and February 29, 2024 was 10.1% and 8.0%, respectively. The increase was primarily due to a strong performance of the third quarter in fiscal year 2025, a forgiveness of account payable amounting to approximately $220,000 and a decrease in advertising expenses.
Current wording
Adjusted EBITDA increased by $502,032 or 291.3% from $172,323 for the three months ended August 31, 2024 to $674,355 for the three months ended August 31, 2025. Adjusted EBITDA as a percentage of sales, net for the three months ended August 31, 2025 and 2024, was 9.8% and 2.9%, respectively. Adjusted EBITDA increased primarily due to the increase in gross profit related to higher volume of units sold.
Previous wording
Net cash flows used in investing activities for the nine months ended February 28, 2025 was $255,778 due to the purchase of intangibles and property and equipment for the Company’s business. For the nine months ended February 29, 2024, net cash flows used in investing activities were $80,192, attributable to the cash used in the purchase of property and equipment primarily relating to our expansion into new product lines.
Current wording
Net cash flows used in investing activities for the three months ended August 31, 2025 was $94,497 due to the purchase of intangibles and property and equipment for our business. For the three months ended August 31, 2024, net cash flows used in investing activities was $41,840, attributable to the cash used in the purchase of intangibles relating to our expansion into new product lines.
Previous wording
Net cash flows provided by financing activities for the nine months ended February 28, 2025 was $11,142, and were from advances made from a related party of $16,778 partially offset by a repayment of the note payable of $5,636. Net cash flows used in financing activities for the nine months ended February 29, 2024 were $204,246 primarily related to the repayment of note payable of $25,438 and payments to our related party of $176,608.
Current wording
Net cash flows provided by financing activities for the three months ended August 31, 2025 was $150,461 primarily related to net advances made from a related party of $151,491. Net cash provided by financing activities for the three months ended August 31, 2024 was $39,370 primarily related to net advances from a related party of $41,707.
Previous wording
As of February 28, 2025, we had a secured Economic Injury Disaster Loan outstanding, administered pursuant to the CARES Act in the principal amount of $140,958, with a maturity date of May 18, 2050. The Company continues to pay interest and principal on the loan.
Current wording
As of August 31, 2025, we had a secured Economic Injury Disaster Loan outstanding, administered pursuant to the CARES Act in the principal amount of $139,199, with a maturity date of May 18, 2050. The Company continues to pay interest and principal on the loan.
Previous wording
We are dependent on our product sales to fund our operations and may require additional capital in the future, such as pursuant to the sale of additional common or preferred stock or of debt securities or entering into credit agreements or other borrowing arrangements with institutions or private individuals, to maintain operations, which may not be available on favorable terms, or at all, and could require us to sell certain assets or discontinue or curtail our operations. If the current equity and credit markets deteriorate, it may make any necessary debt or equity financing more difficult to obtain, more costly and more dilutive. Our officers and directors have made no written commitments with respect to providing a source of liquidity in the form of cash advances, loans, and/or financial guarantees. We do not have any plans to seek additional financing at this time and anticipate that our existing cash equivalents and cash provided by operations will be sufficient to meet our working capital requirements. However, if the need arises for additional cash, there can be no assurance that we will be able to raise the capital we need for our operations on favorable terms, or at all. We may not be able to obtain additional capital or generate sufficient revenues to fund our operations. Failure to secure any necessary financing in a timely manner and on favorable terms could have a material adverse effect on our growth strategy, financial performance and stock price and could require us to delay or abandon our business plans. If we are unsuccessful at raising sufficient funds, for whatever reason, to fund our operations, we may be forced to cease operations. If we fail to raise funds, we expect that we will be required to seek protection from creditors under applicable bankruptcy laws.
Current wording
We are dependent on our product sales to fund our operations and may require additional capital in the future, such as pursuant to the sale of additional common stock, preferred stock, debt securities or entering into credit agreements or other borrowing arrangements with institutions or private individuals, to maintain operations, which may not be available on favorable terms, or at all, and could require us to sell certain assets or discontinue or curtail our operations. If the current equity and credit markets deteriorate, it may make any necessary debt or equity financing more difficult to obtain, more costly and more dilutive. Our officers and directors have made no written commitments with respect to providing a source of liquidity in the form of cash advances, loans, and/or financial guarantees. We do not have any plans to seek additional financing at this time and anticipate that our existing cash equivalents and cash provided by operations will be sufficient to meet our working capital requirements. However, if the need arises for additional cash, there can be no assurance that we will be able to raise the capital we need for our operations on favorable terms, or at all. We may not be able to obtain additional capital or generate sufficient revenues to fund our operations. Failure to secure any necessary financing in a timely manner and on favorable terms could have a material adverse effect on our growth strategy, financial performance and stock price and could require us to delay or abandon our business plans. If we are unsuccessful at raising sufficient funds, for whatever reason, to fund our operations, we may be forced to cease operations. If we fail to raise funds, we expect that we will be required to seek protection from creditors under applicable bankruptcy laws.