Company: TCRG
Filing Date: 2025-03-21
Form Type: 10-K
Source: 0001185185-25-000206
Chunk: 88

Company: Cannaisseur Group Inc.
Filing Date: 2025-03-21
Form: 10-K
Item: Item 1A
Chunk 88
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, Drug, and Cosmetic Act regulates the formulation, manufacturing, packaging, labeling, and distribution of
food, dietary supplements, drugs, cosmetic, medical devices, biologics, and tobacco products. Our hemp-derived CBD products are not intended
to be drugs. Accordingly, we have not been required to obtain FDA approval for our existing hemp-derived CBD products. Moreover, the
regulatory status of hemp-derived CBD products is in a state of flux as FDA attempts to determine the appropriate manner in which to
regulate these products. Thus, the regulatory approach is still evolving, and we may be required to seek FDA’s approval to market
food and dietary supplements containing hemp-derived CBD. It is also possible that the FDA may simply issue a regulation setting forth
the conditions in which such products may be marketed, or it may simply prohibit these products. However, because FDA’s regulatory
process is in its infancy, we cannot predict the likely outcome. (See preceding Section, “Government Regulation”.) In addition,
the FTC under the Federal Trade Commission Act (“FTC Act”) requires that product advertising be truthful, substantiated,
and non-misleading. We believe that our advertising meets these requirements. However, the FTC may bring a challenge at any time to evaluate
our compliance with the FTC Act.

Increases
in the cost of ingredients, labor and other costs could adversely affect our operating results.

Our
CBD products contain hemp-derived CBD oil. Increases in the cost of ingredients in our products could have a material adverse effect
on our operating results. Significant price increases, market conditions, weather, acts of God and other disasters could materially
affect our operating results. An increase in our operating costs could adversely affect our profitability. Factors such as inflation,
increased labor and employee benefit costs and increased energy costs may adversely affect our operating costs. Many of the factors
affecting costs are beyond our control and we may not be able to pass along these increased costs to our customers.

We
do not have long-term contracts with many of our suppliers, and as a result they could seek to increase prices or fail to deliver.

We
typically do not rely on written contracts or long-term arrangements with our suppliers. Although we have not experienced significant
problems with our suppliers, our suppliers may implement significant price increases or may not meet our requirements in a timely
fashion, if at all. The occurrence of any of the foregoing could have a material adverse effect on our operating results.

9

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Risks
Related to