Company: KAVL
Filing Date: 2025-09-16
Form Type: 10-Q
Source: 0001731122-25-001266
Chunk: 104

Company: Kaival Brands Innovations Group, Inc.
Filing Date: 2025-09-16
Form: 10-Q
Item: Item 8
Chunk 104
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 unable to generate meaningful sales of its licensed products, our business
and results of operations would be materially harmed.

Ability to Develop
and Monetize the GoFire Intellectual Property

We
                                            purchased certain vaporizer and inhalation-related technology from GoFire in May 2023 with
                                            the goal of diversifying our business and lessening our dependence on BIDI Vapor. We do not
                                            expect that the acquired assets will generate immediate revenue for us, and while we believe
                                            this to be a transformative acquisition for us and we are seeking to monetize the acquired
                                            assets, we can give no assurances at this time that either (i) the patent applications
                                            we acquired will eventuate in issued patents or (ii) we will be able to enter into successful
                                            monetizing arrangements with respect to these assets.

Inflation

Consumer purchases of tobacco
products are historically affected by economic conditions, such as changes in employment, salary and wage levels, the availability of
consumer credit, inflation, interest rates, fuel prices, sales taxes, and the level of consumer confidence in prevailing and future economic
conditions. The U.S. has been experiencing an environment of material inflation in recent quarters, and this condition may impact discretionary
consumer purchases, such as the BIDI® Stick. Demand for our Products may also decline during recessionary periods or at other times
when disposable income is lower, and taxes may be higher.

Corporate History

We were incorporated on September 4, 2018, in the
State of Delaware. Effective July 12, 2019, we changed our corporate name from Quick Start Holdings, Inc. to Kaival Brands Innovations
Group, Inc. The name change was effected through a parent/subsidiary short-form merger of Kaival Brands Innovations Group, Inc., our wholly-owned
Delaware subsidiary formed solely for the purpose of the name change, with and into us. We were the surviving entity.

2

Change of Control

On February 6, 2019, we entered into a Share Purchase
Agreement (the “Share Purchase Agreement”), by and among us, GMRZ Holdings LLC, a Nevada limited liability company (“GMRZ”),
our then-controlling stockholder, and Kaival Holdings, LLC, a Delaware limited liability company (“KH”), pursuant to which,
on February 20, 2019, GMRZ sold 24,000,000 shares of our restricted common stock, representing approximately 88.06% of our then