Company: KAVL
Filing Date: 2025-02-10
Form Type: 10-K
Source: 0001731122-25-000185
Chunk: 10

Company: Kaival Brands Innovations Group, Inc.
Filing Date: 2025-02-10
Form: 10-K
Item: Item 1
Chunk 10
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”), as a wholly owned subsidiary for
the purpose of developing our own branded and white-label products and services, of which none has commenced as of the date of this Report.
We have not  launched any Kaival-branded products, nor have
we begun to provide white label wholesale solutions for other product manufacturers.

On
May 30, 2023, through Kaival Labs, we acquired certain vaporization and inhalation-related intellectual property from GoFire, Inc. (“GoFire”)
in exchange for equity securities for our company and contingent cash consideration. The goal of this acquisition is to diversify our
product offerings and create near and longer-term revenue opportunities in the form of potential licenses for the acquired technology
and our development of new products based on the purchased assets. In the near term, we expect to seek third-party licensing opportunities
in the cannabis, hemp/CBD, nicotine and nutraceutical markets. Longer term, we believe we can utilize the purchased assets to create
innovative and market-disruptive products, including patent protected vaporizer devices and related hardware and software applications.
No assurance can be given, however, that the GoFire assets will generate revenue for us in the future or otherwise create the value for
our company that we anticipate.

On March 11, 2022, we formed Kaival Brands International,
LLC, a Delaware limited liability company (herein referred to as “KBI”), as a wholly owned subsidiary for the purpose of entering
into an international licensing agreement with Philip Morris Products S.A. (“PMPSA”), a wholly owned affiliate of Philip Morris
International Inc. (“PMI”), as described further below.

Philip Morris Deed of Licensing Agreement  

On June 13, 2022, KBI entered into the PMI License
Agreement with PMPSA, effective as of May 13, 2022 (the “PMI Commencement Date”). Pursuant to the PMI License Agreement, KBI
granted PMPSA an exclusive irrevocable license to use its technology, documentation, and intellectual property to make, distribute, and
sell disposable nicotine e-cigarette products based on the intellectual property in certain international markets set forth in the PMI
License Agreement (or the PMI Markets). We have the exclusive international distribution rights to products and, in order to allow KBI
to fulfill its obligations set forth in the PMI License Agreement, has contributed the international distribution rights for the PMI Markets
to