Company: SWAGW
Filing Date: 2025-02-11
Form Type: 10-Q
Source: 0001213900-25-011872
Chunk: 269

Company: Stran & Company, Inc.
Filing Date: 2025-02-11
Form: 10-Q
Item: Part II, Item 8
Chunk 269
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 unobservable inputs used in the
fair value measurements are (i) the operating income projections (projected gross profit amounts within the risk-neutral framework) over
the earn-out period (generally three or five years), (ii) the strike price, and (iii) volatility. Significant increases or decreases
to any of these inputs in isolation would result in a significantly higher or lower liability, with a higher liability capped by the
contractual maximum of the contingent earn-out obligations. Ultimately, the liability will be equivalent to the amount paid, and the
difference between the fair value estimate and amount paid will be recorded in earnings. The amount paid that is less than or equal to
the contingent earn-out liability on the acquisition date is reflected as cash used in financing activities in the consolidated statements
of cash flows. Any amount paid in excess of the contingent earn-out liability on the acquisition date is reflected as cash used in operating
activities in the consolidated statements of cash flows.

Recent Accounting Pronouncements

For a discussion of
recently adopted accounting pronouncements, see Recently Issued Accounting Pronouncements in Note A.16 to our financial statements
beginning on page 1 of this Quarterly Report on Form 10-Q.

ITEM
3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Not applicable.

ITEM
4. CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures

Our management, with the participation of our
Chief Executive Officer and Chief Financial Officer, evaluated our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under
the Exchange Act) prior to the filing of this Quarterly Report on Form 10-Q. Based on that evaluation, our Chief Executive Officer
and Chief Financial Officer concluded that, as of the end of the period covered by this Quarterly Report on Form 10-Q, our disclosure
controls and procedures were not effective due to the following material weaknesses in our internal control over financial reporting:

●There
                                            was a material weakness in our internal controls related to the proper design and implementation
                                            of control over formal review, approval, and evaluation of complex accounting transactions
                                            associated with business combinations.

●We identified a material weakness
                                            in internal control related to the proper design and implementation of certain controls over
                                            management’s formal review process that includes multiple levels of review as well
                                            as timely review of accounts and reconciliations leading to material adjustments.

●We identified a