Company: BOF
Filing Date: 2025-05-15
Form Type: 10-Q
Source: 0001641172-25-010566
Chunk: 111

Company: BranchOut Food Inc.
Filing Date: 2025-05-15
Form: 10-Q
Item: Item 2
Chunk 111
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 going concern. The condensed consolidated financial statements also do not include any adjustments
relating to the recoverability and classification of recorded asset amounts, or amounts and classifications of liabilities that might
be necessary should the Company be unable to continue as a going concern. Our ability to scale production and distribution capabilities
and further increase the value of our brands, is largely dependent on our success in raising additional capital.

Peru
Facility Lease

On
April 26, 2024, we formed BranchOut Food Sucursal Peru for the purpose of developing a production facility to produce our products
in Peru. On May 10, 2024 we entered into a ten-year lease for our 50,000 square-foot food processing plant located in Peru (the
“Peru Facility”). The lease of the Peru Facility requires us to make monthly lease payments of $8,000 in the first two
years of the lease, $20,000 in the third year of the lease, $22,000 in the fourth year of the lease, $24,000 in the fourth year of
the lease, and $25,000 thereafter. The lease also has a 10-year renewal option, and a buy-out option under which we may purchase the
facility for $1,865,456. We began manufacturing products at the Peru Facility in December of 2024, and produced approximately
$1,450,000 of products during the first quarter of 2025.

In
connection with our lease of the Peru Facility, we paid $275,000 on May 10, 2024, $80,000 during the fourth quarter of 2024, and another
$456,000 during the first quarter of 2025 as part of the purchase of a first position mortgage receivable in the amount of $1,267,000,
which is secured by the Peru Facility and was owed by the landlord of the Peru Facility to its former tenant. The remaining $456,000
is due and payable in monthly installments of $152,000 through June 23, 2025, at which time an additional $55,604 of interest is due,
based on a 9% financing rate.

25

Results
of Operations for the Three Months Ended March 31, 2025 and 2024

The
following table summarizes selected items from the statement of operations for the three months ended March 31, 2025 and 2024, respectively.

    Three Months Ended  

    March