Company: BOF
Filing Date: 2025-04-15
Form Type: 10-K
Source: 0001641172-25-004712
Chunk: 511

Company: BranchOut Food Inc.
Filing Date: 2025-04-15
Form: 10-K
Item: Item 1A
Chunk 511
---
 was $19,000, based on the
closing traded price of the common stock on the date of grant.

Note
5 – Formation of Subsidiary

On
April 26, 2024, the Company formed BranchOut Food Sucursal Peru, a wholly-owned subsidiary in Peru, in the form of a legal entity
called a branch, for the purpose of operating the 50,000
square-foot Peru Facility. The Company began manufacturing products at the Peru Facility in December of 2024.

Note
6 – Fair Value of Financial Instruments

Under
FASB ASC 820-10-5, fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly
transaction between market participants at the measurement date (an exit price). The standard outlines a valuation framework and creates
a fair value hierarchy in order to increase the consistency and comparability of fair value measurements and the related disclosures.
Under GAAP, certain assets and liabilities must be measured at fair value, and FASB ASC 820-10-50 details the disclosures that are required
for items measured at fair value.

The
Company has cash, notes receivable, derivative liabilities and debts that must be measured under the fair value standard. The Company’s
financial assets and liabilities are measured using inputs from the three levels of the fair value hierarchy. The three levels are as
follows:

Level
1 - Inputs are unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access
at the measurement date.

Level
2 - Inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets
or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability (e.g.,
interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data by correlation
or other means (market corroborated inputs).

Level
3 - Unobservable inputs that reflect our assumptions about the assumptions that market participants would use in pricing the asset or
liability.

The
following schedule summarizes the valuation of financial instruments at fair value on a recurring basis in the balances sheet as of December
31, 2024 and 2023:

 Schedule of Valuation of Financial Instruments at Fair Value on a Recurring Basis

    Level
    1  
    Level
    2  
    Level
    3