Company: KAVL
Filing Date: 2025-02-10
Form Type: 10-K
Source: 0001731122-25-000185
Chunk: 155

Company: Kaival Brands Innovations Group, Inc.
Filing Date: 2025-02-10
Form: 10-K
Item: Item 1A
Chunk 155
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 the Business Combination, the ongoing business of Kaival may be adversely impacted and, without realizing any of the anticipated
benefits of completing the Business Combination, Kaival would be subject to a number of risks, including the following:

    ●
    we
    may experience negative reactions from the financial markets, including negative impacts on our stock price (including to the extent
    that the current market price reflects a market assumption that the Business Combination will be completed);

    ●
    we
    will have incurred substantial expenses and will be required to pay certain costs relating to the Business Combination, whether or
    not the Business Combination is completed; and

    ●
    since
    the Merger Agreement restricts the conduct of our business prior to completion of the Business Combination, we may not have been
    able to take certain actions during the pendency of the Business Combination that would have benefitted it as an independent company,
    and the opportunity to take such actions may no longer be available.

Risks Related to Our Business and Industry  

If the claims against the Company and Bidi that
have been filed with the International Trade Commission are successful, the Company and Bidi could be prohibited from importing and selling
the Bidi Stick in to the United States.

On June 11, 2024, RAI Strategic Holdings, Inc., R.J. Reynolds Vapor Company,
R.J. Reynolds Tobacco Company, and RAI Services Company (collectively, the “RJ Reynolds Entities”) filed a patent infringement
complaint with the International Trade Commission (the “ITC”) against Bidi, us, and forty (40) other respondents (the “ITC
Complaint”) pursuant to Section 337 of the Tariff Act of 1930, as amended. Specifically, the ITC Complaint alleges that one or more
components or elements of the Bidi Stick infringe U.S. Patent No. 11,925,202, which is owned by one of the RJ Reynolds Entities. The ITC
Complaint requests the ITC grant: (a) temporary and permanent limited exclusion orders pursuant to Section 337(e) of the Tariff Act of
1930, as amended, which would prohibit the importation of the Bidi Stick in the United States; and (b) issue temporary and permanent cease
and desist orders pursuant to 337(f) of the Tariff Act of 1930, as amended, which would prohibit the sale and distribution of the Bidi
Stick in