Company: JSDA
Filing Date: 2025-05-15
Form Type: 10-Q
Source: 0001641172-25-011093
Chunk: 21

Company: JONES SODA CO.
Filing Date: 2025-05-15
Form: 10-Q
Item: Part I, Item 8
Chunk 21
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.75% per annum and all present and future obligations of the Subsidiary arising under the Loan Agreement
are secured by a first priority security interest in all of the assets of the Company, the Subsidiary and the Company’s other United
States subsidiaries. The Loan Agreement replaces the $2 million revolving credit facility entered into by the Company in March 2024 (the
“2024 Credit Facility”). The borrowing base under the Loan Agreement expands the assets that can be financed against from
only accounts receivable under the 2024 Credit Facility to accounts receivable, inventory and customer purchase orders.

Additionally,
on May 7, 2025, the Company entered into a loan agreement with the Chairman of the Company’s Board of Directors in the amount of
$450,000. The interest rate on this loan is 12% per annum. The principal, together with accrued interest and a loan fee of $22,000,
is due and payable in full by October 10, 2025. A $22,000 loan fee is also due upon repayment. The proceeds from this loan
are expected to be used for general working capital purposes.

Based
on management’s current operating plan, the Company believes its cash on hand, projected cash generated from product sales and
funds received from under the Loan Agreement are sufficient to fund the Company’s operations for a period of at least 12 months
subsequent to the issuance of the accompanying Condensed Consolidated Financial Statements. There is no assurance that management’s
current operating plan will be successful.

Critical
Accounting Policies and Estimates

See
the information concerning our critical accounting policies and estimates included under “Item 7. Management’s
Discussion and Analysis of Financial Condition and Results of Operation – Critical Accounting Policies and Estimates” in our Annual
Report on Form 10-K for the fiscal year ended December 31, 2024, filed with the SEC on April 1, 2025. There have been no material
changes in our critical accounting policies during the three months ended March 31, 2025.

19

  ITEM
  3.
  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
  RISK

Not
applicable.

  ITEM 4.
  CONTROLS AND PROCEDURES.

(a)
Evaluation of disclosure controls and procedures

We
maintain disclosure controls and procedures (as such terms are defined under Rules 13a-15(e) and 15d-15(e