Company: BOF
Filing Date: 2025-11-12
Form Type: 10-Q
Source: 0001493152-25-021655
Chunk: 47

Company: BranchOut Food Inc.
Filing Date: 2025-11-12
Form: 10-Q
Item: Item 1
Chunk 47
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, 2025.

During
the period ended September 30, 2025, of the 518,750 Warrants
issued to purchasers of the Senior Secured Notes, Warrants were exercised to purchase an aggregate of 307,500 shares
of the Company’s common stock at an exercise price of $1.00 per
share for aggregate cash proceeds of $307,500. 

    27

Note
19 – Commitments and Contingencies

Legal
Matters

From
time to time, the Company may be a party to various legal matters, threatened claims, or proceedings in the normal course of business.
Legal fees and other costs associated with such actions are expensed as incurred. The Company assesses the likelihood of outcomes in
litigation and makes appropriate accruals and disclosures based on current information and legal counsel’s opinions. There’s
no guarantee that these matters won’t significantly impact the Company’s business, financial position, or results of operations.
Legal accruals are recorded when and if it is determined that a loss related to a certain matter is both probable and reasonably estimable.

The
Company is the subject of a lawsuit recently commenced by its former chief financial officer alleging wrongful termination. Based on
information currently available to the Company and the advice of legal counsel, management believes that the outcome of this lawsuit
is not probable to result in a material adverse effect on the Company’s financial position, results of operations, or cash flows.
While the Company intends to vigorously defend itself against these allegations, the ultimate outcome of the lawsuit is not possible
to predict. At this time given the uncertainties inherent in litigation, it is not reasonable to estimate the amount or range of any
potential loss, and therefore no liability has been accrued in the accompanying financial statements.

Other
than as set forth above, there are no legal matters pending against the Company.

Operating
Lease

On
May 10, 2024, the Company entered into a ten-year lease for the 50,000 square-foot Peru Facility, which commenced operations in December
of 2024. The lease requires 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 the Company