Company: KAVL
Filing Date: 2025-06-16
Form Type: S-3
Source: 0001731122-25-000885
Chunk: 22

Company: Kaival Brands Innovations Group, Inc.
Filing Date: 2025-06-16
Form: S-3
Chunk 22
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 federal level
has been introduced in the past and could potentially be adopted in the future. Any future enactment of excise tax increases at the federal,
state, or local level could potentially result in lower consumption, a shift in sales to discount brands, illicit trade channels or alternatives
as consumers seek lower priced products, any of which could result in a decline of our shipment volume, revenue, and profit. We ceased
all direct-to-consumer sales in February 2021.

International Regulations and Pertinent Information

The World Health Organization’s Framework Convention
on Tobacco Control (the “FCTC”) is the first international public health treaty that establishes a global agenda to reduce
initiation of tobacco use and regulate tobacco to encourage tobacco cessation. Over 170 governments worldwide have ratified the FCTC.
The FCTC has led to increased efforts to reduce the supply and demand of tobacco products and to encourage governments to further regulate
the tobacco industry. The tobacco industry expects significant regulatory developments to take place over the next few years, driven principally
by the FCTC. Regulatory initiatives that have been proposed, introduced, or enacted include:

| ● | the levying of substantial and increasing tax and duty charges; |

| ● | restrictions or bans on advertising, marketing, and sponsorship; |

| ● | the display of larger health warnings, graphic health warnings, and other labeling requirements; |

| ● | restrictions on packaging design, including the use of colors and generic packaging; |

| ● | restrictions or bans on the display of tobacco product packaging at the point of sale, and restrictions or bans on cigarette vending machines; |

| ● | requirements regarding testing, disclosure, and performance standards for tar, nicotine, carbon monoxide, and other smoke constituents’ levels; |

| ● | requirements regarding testing, disclosure, and use of tobacco product ingredients; |

| ● | increased restrictions on smoking in public and workplaces and, in some instances, in private places and outdoors; |

| ● | elimination of duty-free allowances for travelers; and |

| ● | encouraging litigation against tobacco companies. |

If the United States becomes a signatory to the FCTC
and/or national laws are enacted in the United States that reflect the major elements of the FCTC, our business, results of operations
and financial condition could be materially and adversely affected.

Environmental Laws

We may be subject to federal, state, and local environmental
laws and regulations. Compliance with these provisions has not had, nor do we expect such compliance will have any, material adverse