Company: KAVL
Filing Date: 2025-02-10
Form Type: 10-K
Source: 0001731122-25-000185
Chunk: 782

Company: Kaival Brands Innovations Group, Inc.
Filing Date: 2025-02-10
Form: 10-K
Item: Item 7
Chunk 782
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 issued 3,025,000 fully
vested shares of common stock to directors, officers and an employee pursuant to grants under the Company’s Amended and Restated
2020 Stock and Incentive Compensation Plan.

On December 3, 2024, the Company paid accrued dividends
of $405,000 to Series B Preferred shareholders.

On various dates from November 2024 through January 2025, the Company received
reimbursements of non-recurring engineering costs from PMPSA totaling $932,937 which have been fully remitted to Bidi.

F-27

Item 9. Changes in and Disagreements with Accountants on Accounting
and Financial Disclosure.

None.

Item 9A. Controls and Procedures.  

Evaluation of Disclosure Controls and Procedures

We maintain “disclosure controls and procedures,”
as such term is defined in Rule 13a-15e and Rule 15d-15(e) under the Exchange Act that are designed to ensure that information required
to be disclosed in our reports filed under the Exchange Act is recorded, processed, summarized and reported within the time periods specified
in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our President
& Chief Operating Officer and our Interim Chief Financial Officer to allow for timely decisions regarding required disclosure.

As of October 31, 2024, the end of the year covered
by this Report, we carried out an evaluation under the supervision and with the participation of members of our management, including
our President & Chief Operating Officer and our Chief Financial Officer, of the effectiveness of the design and the operation of our
disclosure controls and procedures pursuant to Rule 13a-15(b) of the Exchange Act. Our management has concluded, based on their evaluation,
that the disclosure controls and procedures were not effective as of the end of the year covered by this Report due to material weaknesses
identified below.

Management’s Annual Report on Internal
Control Over Financial Reporting

Our management is responsible for establishing and
maintaining adequate internal control over our financial reporting (as defined in Rule 13a-15(f) under the Exchange Act). Internal control
over financial reporting is a process, including policies and procedures, designed to provide reasonable assurance regarding the reliability
of financial reporting and the preparation of financial statements for external reporting purposes in accordance with U.S. generally accepted
accounting principles. Our management assessed our internal control over financial reporting using the criteria in Internal Control –