Company: BOF
Filing Date: 2025-08-13
Form Type: 10-Q
Source: 0001641172-25-023605
Chunk: 96

Company: BranchOut Food Inc.
Filing Date: 2025-08-13
Form: 10-Q
Item: Item 8
Chunk 96
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 $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 may purchase the Peru Facility for $1,865,456.

Finance
Lease

The
Company leases equipment under a non-cancelable finance lease payable in monthly installments of $3,657 expiring on May 31, 2028.

    21

BRANCHOUT
FOOD INC.

NOTES
TO THE CONDENSED FINANCIAL STATEMENTS

(Unaudited)

Other
Contractual Commitments

On
January 19, 2022, the Company entered into a contract manufacturing agreement with NXTDried Superfoods SAC to produce products for distribution
by the Company. The Company agreed to pre-pay for inventory via an advance to enable the manufacturer to invest in necessary processing
facilities that will be reimbursed to the Company on an agreed per kg basis over the period of 2022 to 2026.

On
May 7, 2021, the Company entered into a license agreement (“License Agreement”) with EnWave, pursuant to which EnWave licensed
to the Company a collection of patents and intellectual property (the “EnWave Technology”) used to manufacture and operate
vacuum microwave dehydration machines purchased by the Company from EnWave (the “EnWave Equipment”). The License Agreement
was amended on October 26, 2022, September 27, 2023, and May 23, 2024, to, among other things, modify the exclusivity retention royalty
payments required to be paid by the Company. The License Agreement entitles EnWave to a fixed royalty percentage on all of the Company’s
revenue from the sale of products produced using the EnWave Technology, net of trade or volume discounts, refunds paid, settled claims
for damaged goods, applicable excise, sales and withholding taxes imposed at the time of the sale, and provides the Company with certain
exclusivity rights with respect to the production of avocado products. In order to maintain exclusivity, the Company must make annual
royalty minimum payments to EnWave of $250,000 per year, commencing in 2025 and continuing through each subsequent year in perpetuity,
as long