Real-time Form 4 intelligence. Smarter insider tracking.
YoY shift: Neutral
Year-over-year tone shift - average net-tone change across Risk Factors and MD&A vs the prior 10-K. This filing is 0.10pp more bullish than last year's.
Why YoY instead of absolute: the LM lexicon has ~6.6× more negative words than positive (legal/risk-disclosure language is heavy on hedging), so every 10-K reads bearish on raw tone. Year-over-year change strips that bias and surfaces the actual shift in management's framing.
Tone shift by section
The two components the gauge averages: how Risk Factors and MD&A each shifted in net tone versus last year's 10-K. The headline above is their average, so a green needle over a soft section just means the other section carried it.
Risk Factors
-
Not scored
Net-tone change vs last year's 10-K.
MD&A
+0.10pp
Flat
Net-tone change vs last year's 10-K.
Per-snippet highlights
Sentence-level sentiment highlighting with category and subcategory filters is coming once the snippet-scoring pipeline lands. For now, dig into the actual section text on the Sections tab.
No section text extracted for this filing. The 10-K may use a non-standard template that the parser doesn't recognize - the original doc is still linked in the Stats tab.
Language change vs prior 10-K
MD&A (Item 7) - words with the biggest YoY frequency increase
Negative rising
impairment+3
loss+3
decline+3
critical+2
threats+2
Positive rising
gain+2
positive+2
improvement+1
benefited+1
improved+1
MD&A (Item 7)
4,469 words
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
You should read the following discussion in conjunction with our audited historical consolidated financial statements, which are included elsewhere in this report. “Management’s Discussion and Analysis of Financial Condition” and “Results of Operations” contains forward-looking statements that reflect our plans, estimates, and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements.
This report includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical facts contained in this report, including statements regarding our future financial position, liquidity, business strategy, plans and objectives of management for future operations, are forward-looking statements.
Forward-looking statements contained in this report include:
Our liquidity;
Opportunities for our business; and
Growth of our business.
The words “believe,” “may,” “estimate,” “continue,” “anticipate,” “intend,” “should,” “plan,” “could,” “target,” “potential,” “is likely,” “expect,” and similar expressions, as they relate to us, are intended to identify forward-looking statements. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy and financial needs.
The results anticipated by any or all of these forward-looking statements might not occur. Important factors, uncertainties and risks that may cause actual results to differ materially from these forward-looking statements are contained in the Risk Factors contained herein. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future developments or otherwise. For more information regarding some of the ongoing risks and uncertainties of our business, see the Risk Factors below.
Factors Affecting Our Performance
We believe the following factors affect our performance:
Retail : We believe the operating performance of our retail stores will affect our revenue and financial performance. The Company has four natural and organic groceries and dietary supplement stores located in Florida, nine located in New York and New Jersey, one store in Virginia, as well as five stores in Kansas and Oklahoma.
Increased Competition : Food retail is a large and competitive industry. Our competition varies and includes national, regional, and local conventional supermarkets, national superstores, alternative food retailers, natural foods stores, smaller specialty stores, and farmers’ markets. In addition, we compete with restaurants and other dining options in the food-at-home and food-away-from-home markets. The opening and closing of competitive stores, as well as restaurants and other dining options, in regions where we operate will affect our results. In addition, changing consumer preferences with respect to food choices and to dining out or at home can impact us. We also expect increased product supply and the downward pressure on prices to continue and impact our operating results in the future.
Overview and Significant Events
The following material events significantly affected the Company’s financial condition and results of operations for the year ended December 31, 2025:
Standalone Operations: Following the Spin-Off from HCMC in September 2024, the Company operated as an independent, publicly-traded entity for the full year, incurring standalone public company costs.
Strategic Acquisition: The acquisition of GreenAcres Market in July 2024 was the primary driver of revenue growth, adding five stores and contributing significantly to sales.
Liquidity and Capital Resources: The Company has incurred net losses and negative working capital. Management’s plans to address this, including cost-reduction initiatives and a committed equity financing, are critical to continuing as a going concern (see detailed discussion in Liquidity and Capital Resources ).
Related-Party Transaction: The settlement of an intercompany receivable with HCMC resulted in a non-cash investment asset.
Internal Controls: The Company is remediating material weaknesses in internal controls identified during the year.
Results of Operations
The following table sets forth our Consolidated Statements of Operations for the years ended December 31, 2025 and 2024 which is used in the following discussions of our results of operations:
For the Years Ended December 31,
Change $
SALES
COST OF SALES
GROSS PROFIT
OPERATING EXPENSES, NET
Selling, general and administrative
Gain on sale of asset
TOTAL OPERATING EXPENSES, NET
LOSS FROM OPERATIONS
OTHER INCOME (EXPENSE)
Loss on debt extinguishment
Other income, net
Interest (expense) income, net
TOTAL OTHER (EXPENSE) INCOME, NET
NET LOSS
Sales increased $8.8 million to $78.2 million for the year ended December 31, 2025 as compared to $69.4 million for the same period in 2024. The increase was primarily due to a full year of operations from the GreenAcres Market acquisition (acquired in July 2024), which contributed approximately $7.8 million, and a $1.0 million increase in same-store sales.
Cost of goods sold for the years ended December 31, 2025 and 2024 were $47.5 million and $42.3 million, respectively, an increase of $4.8 million was primarily a result of full year operations in 2025 of GreenAcres Market acquisition acquired in July 2024, and $0.4 million increase in same-store cost of goods sold.
Total operating expenses increased $4.3 million from $28.8 million for the year ended December 31, 2024 to $33.1 million for the year ended December 31, 2025. The increase of $3.0 million was a result of full year operations for the year ended December 31, 2025 of GreenAcres Market acquisition acquired in July 2024, $1.2 million increase in professional fee, taxes, license and permit, and $0.1 million increase in stock-based compensation expense.
Total other (expenses) income, net of $1.5 million for the year ended December 31, 2025 consists of $0.4 million loss on debt extinguishment, and net interest expense of $1.1 million. Total other (expenses) income, net of $2.7 million for the year ended December 31, 2024 consists of $1.9 million loss on debt extinguishment, and net interest expense of $0.8 million.
The year-over-year improvement in net loss was impacted by several significant items in 2024 that are not expected to recur with similar magnitude:
2024 benefited from a non-recurring gain of $0.2 million on the sale of our Saugerties, NY building. No similar gain was recorded in 2025.
2024 incurred certain non-recurring costs associated with the Spin-Off from HCMC and our initial public offering. While public company costs continue, the discrete, incremental costs of those transactions are not expected to repeat.
Lease Commitments, Known Trends and Uncertainties
Our retail operations are substantially dependent on leased facilities. As of December 31, 2025, we had total lease liabilities of $10.7 million, comprised of $10.6 million for operating leases (primarily for our 19 retail stores and headquarters) and $0.1 million for a finance lease on data center equipment. The weighted-average remaining lease term for operating lease is 4 years, with a weighted-average discount rate of 5.30%. Lease expense for the year ended December 31, 2025 was $3.9 million, compared to $4.2 million in 2024. The overall decrease is primarily attributable to a significant reduction in variable lease costs, which are primarily based on property taxes and are expensed as incurred. Looking forward, we expect overall lease expense to be influenced by two key factors: the expiration of certain leases and potential new commitments at market rates, and fluctuations in variable costs, primarily property taxes, which are inherently uncertain but have trended lower in the current year. Rising interest rates and inflation could increase the cost of future lease obligations. While the weighted-average discount rate increased marginally to 5.30% from 5.19% in 2024, a sustained rate hike environment may elevate borrowing costs for future lease liabilities.
Liquidity and Capital Resources
For the Years Ended December 31,
Net cash provided by (used in):
Operating activities
Investing activities
Financing activities
Net increase in cash
Our net cash provided by operating activities of $1.0 million for the year ended December 31, 2025 resulted from our net loss of $3.9 million and a net cash usage of $3.8 million from changes in operating assets and liabilities, offset by a non-cash adjustments of $8.7 million. Our net cash used in operating activities of $3.1 million for the year ended December 31, 2024 resulted from our net loss of $4.5 million and a net cash usage of $7.6 million from changes in operating assets and liabilities, offset by a non-cash adjustments of $9.0 million.
The net cash used in investing activities of $4.1 million for the year ended December 31, 2025 consists of $3.8 million payment to related party, and $0.3 million purchases of property and equipment, offset by the proceeds from sale of equipment. On December 31, 2025, the Company settled the outstanding $4.0 million receivable from HCMC (including the $3.8 million advanced during 2025 plus prior period amounts) by accepting 43.9 billion shares of HCMC common stock. This non-cash transaction converted the related party receivable into an equity method investment (see Note 13). The investment was initially recorded at the carrying amount of the receivable surrendered ($4.0 million), with no gain recognized, consistent with related party accounting guidance. The Company obtained a third-party valuation of the investment and determined that no impairment was necessary as of December 31, 2025. This transaction did not impact the Company’s cash position but reduced the related party receivable balance to zero as of year-end. The net cash used in investing activities of $5.0 million for the year ended December 31, 2024 consists of $5.5 million payment for GreenAcres Market acquisition, $0.2 million purchases of property and equipment, offset by $0.7 million proceeds from sale of Saugerties building.
The net cash provided by financing activities of $4.1 million for the year ended December 31, 2025 consists of net cash proceeds of $5.1 million from HCWC Series A Preferred Stock offering and principal payment on loan payable of $1.0 million. The net cash provided by financing activities of $8.7 million for the year ended December 31, 2024 consists of cash proceeds of $1.7 million from Security Purchase Agreement signed on January 18, 2024, $7.5 million cash proceeds from Loan and Security Agreement signed on July 18, 2024, $2.6 million cash proceeds from initial public offering, $1.7 million net parent investment from HCMC, $2,000 cash proceeds from warrant exercise, offset by principal payment on loan payable of $2.5 million and $2.3 million payment to HCMC.
At December 31, 2025 and December 31, 2024, we did not have any material financial guarantees or other contractual commitments with trade vendors that are reasonably likely to have an adverse effect on liquidity.
Our cash and cash equivalents balances are kept liquid to support our growing acquisition and infrastructure needs for operational expansion. Most of our cash and cash equivalents are concentrated in two financial institutions. The portion of our balance held as cash deposits in these institutions is generally in excess of the Federal Deposit Insurance Corporation (FDIC) insurance limit.
The Company has not experienced any losses on its cash or cash equivalents. The following table presents the Company’s cash position as of December 31, 2025 and December 31, 2024.
December 31,
December 31,
Cash and cash equivalents
Total assets
Cash and cash equivalents as a percentage of total assets
As of December 31, 2025, the Company had cash and cash equivalents of $3.0 million and negative working capital of $2.7 million. While the Company may continue to report net losses in the near term due to non-cash charges such as depreciation, amortization, and stock-based compensation, the Company generated positive cash flow from operations of $1.0 million for the year ended December 31, 2025, reflecting improved operating performance. The Company’s liquidity needs through December 31, 2025 have been satisfied through initial public offering and financing agreements with private lenders and investors. Also, the Company is formulating plans to raise capital from outside investors and from equity offerings, as it has done in the past, to fund operating losses and also provide capital for further business acquisitions. Based on its cash on hand, positive cash flow from operations, and planned security offerings, management believes the Company will be able to meet its obligations and capital requirements for at least twelve months from the date these consolidated financial statements are issued.
Off-Balance Sheet Arrangements
We do not have any off-balance sheet arrangements other than operating leases for retail locations, equipment, and vehicles.
Seasonality
We do not consider our business to be seasonal.
Cybersecurity
We recognize that cybersecurity is of critical importance to our success. We are committed to maintaining robust cybersecurity and data protection and continuously evaluating the impact of cybersecurity threats, considering both immediate and potential long-term effects of these threats on our business strategy, operations, and financial condition. Our board oversees cybersecurity risks through quarterly updates from the Chief Operating Officer.
Climate-Related Considerations
We have evaluated the potential impact of climate change on our business, including regulatory, physical, and market-related risks. Based on our assessment, we do not believe that climate change currently poses a material risk to our operations or financial performance. Our retail sales operations are not significantly affected by climate-related factors, such as extreme weather or emissions regulations. Nevertheless, we will continue to monitor any developments that could indirectly impact on our business, such as changes in consumer behavior or supply chain disruptions related to climate change.
Critical Accounting Policies and Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. The consolidated financial statements include estimates based on currently available information and our judgment as to the outcome of future conditions and circumstances. These estimates and assumptions include promotional discounts, manufacturer coupons and rebates, return allowances that are netted against revenue, useful lives and impairment of long-lived assets, goodwill and impairment, equity method investments, allowance for credit losses, inventory provisions, deferred taxes and related valuation allowances, allocation of corporate general expenses, and the valuation of the assets and liabilities acquired in business combinations. Changes in the status of certain facts or circumstances could result in material changes to the estimates used in the preparation of the consolidated financial statements and actual results could differ from the estimates and assumptions.
Revenue Recognition
The Company recognizes revenue in accordance with the Financial Accounting Standards Board (FASB) ASC 606, Revenue from Contracts with Customers. The core principle of which is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled to receive in exchange for those goods or services. Revenues from product sales and services rendered, net of promotional discounts, manufacturer coupons and rebates, return allowances, and sales and consumption taxes, are recorded when products are delivered, title passes to customers and collection is likely to occur. Title passes to customers at the point of sale for retail and upon delivery of products for wholesale. Return allowances, which reduce revenue, are estimated using historical experience.
The Company promotes its products with trade incentives and promotions. These programs include sales discounts, rebates, coupons, volume-based incentives, refunds, and returns, which represent variable considerations. The estimation of variable consideration involves judgment and is constrained to avoid overstatement of revenue. The Company applies the expected value method or the most likely amount method, depending on which better predicts the consideration to which it will be entitled. Management evaluates these estimates on a quarterly basis. The trade incentives and promotions are recorded as a reduction to the transaction price based on amounts estimated as being due to customers at the end of the period. The Company derives these estimates based on historical experience. The Company does not receive a distinct service in relation to the trade incentives and promotions.
To achieve this core principle, five basic criteria must be met before revenue can be recognized:
Identification of the contract, or contracts, with a customer;
Identification of the performance obligations in the contract;
Determination of the transaction price;
Allocation of the transaction price to the performance obligations in the contract; and
Recognition of revenue when, or as, the Company satisfies a performance obligation.
The Company does not have significant revenue recognized over time due to the nature of retail store operations. The Company recognizes revenue at a point in time when control of goods or services transfers to the customer.
Impairment of Long-Lived Assets
We review long-lived assets for impairment including intangible assets with determinable useful lives whenever events or changes in circumstances indicate that the carrying value of the corresponding asset group may not be realizable. The Company estimated future undiscounted cash flows associated with the asset group are compared to the asset group’s carrying amount to determine if an impairment of such asset is necessary. This requires us to make long-term forecasts of the future revenues and costs related to the assets groups subject to review. Forecasts require assumptions about demand for our products and future market conditions. Estimating future cash flows requires significant judgment, and our projections may vary from cash flows eventually realized. Future events and unanticipated changes to assumptions could require a provision for impairment in a future period. The effect of any impairment would be reflected in operating income in the Consolidated Statements of Operations. In addition, we estimate the useful lives of our long-lived assets and other intangibles and periodically review these estimates to determine whether these lives are appropriate.
Goodwill
Goodwill is the excess of consideration paid for an acquired entity over the fair value of the amounts assigned to assets acquired, including other identifiable intangible assets, and liabilities assumed in a business combination. To determine the amount of goodwill resulting from a business combination, the company hires a third-party valuation firm to perform valuation and assessment to determine the acquisition date fair value of the acquired company’s tangible and identifiable intangible assets and liabilities.
Goodwill is required to be evaluated for impairment on an annual basis or whenever events or changes in circumstances indicate the asset may be impaired. An entity has the option to first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. These qualitative factors include macroeconomic and industry conditions, cost factors, overall financial performance and other relevant entity-specific events. If the entity determines that this threshold is met, then the company may apply a one-step quantitative test and record the amount of goodwill impairment as the excess of a reporting unit’s carrying amount over its fair value, not to exceed the total amount of goodwill allocated to the reporting unit. The company determines fair value through multiple valuation techniques and weighs the results accordingly. The company is required to make certain subjective and complex judgments in assessing whether an event of impairment of goodwill has occurred, including assumptions and estimates used to determine the fair value of its reporting units. The company has elected to perform its annual goodwill impairment review on September 30 of each year or more often if deemed necessary.
Business Combinations
The Company applies the provisions of ASC Topic 805, Business Combinations (“ASC 805”) in the accounting for acquisitions of businesses. ASC 805 requires the Company to use the acquisition method of accounting by recognizing the identifiable tangible and intangible assets acquired and liabilities assumed, measured at their acquisition date fair values. Goodwill as of the acquisition date is measured as the excess of consideration transferred over the aforementioned amounts. Acquisition costs are expensed as incurred and recorded in selling, general and administrative expenses in the consolidated statements of operations.
Deferred Taxes and Valuation Allowance
We account for income taxes pursuant to the asset and liability method of accounting for income taxes pursuant to FASB ASC 740, “Income Taxes.” Deferred tax assets and liabilities are recognized for taxable temporary differences and operating loss carry forwards. Temporary differences are the differences between the reported amount of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment.
Fair Value Measurements
The fair value framework under FASB’s guidance requires the categorization of assets and liabilities into three levels based upon the assumptions used to measure the assets or liabilities. Level 1 provides the most reliable measure of fair value, whereas Level 3, if applicable, would generally require significant management judgment. The three levels for categorizing assets and liabilities under the fair value measurement requirements are as follows:
Level 1: Fair value measurement of the asset or liability using observable inputs such as quoted prices in active markets for identical assets or liabilities;
Level 2: Fair value measurement of the asset or liability using inputs other than quoted prices that are observable for the applicable asset or liability, either directly or indirectly, such as quoted prices for similar (as opposed to identical) assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active; and
Level 3: Fair value measurement of the asset or liability using unobservable inputs that reflect the Company’s own assumptions regarding the applicable asset or liability.
Recurring Fair Value Measurements
The Company’s financial instruments consist primarily of cash and cash equivalents, accounts receivable, accounts payable, and borrowings. Management believes that the carrying value of cash and cash equivalents, accounts receivable, accounts payable, and borrowings are representative of their respective fair values.
Nonrecurring Fair Value Measurements
The Company’s assets measured at fair value on a nonrecurring basis include long-lived assets, indefinite-lived intangible assets, goodwill and equity method investment. The Company reviews the carrying amounts of such assets at least annually or whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. Any resulting asset impairment would require that the asset be recorded at its fair value.
Equity Method Investment and Other-Than-Temporary Impairment Assessment
The Company accounts for investments in entities over which it has the ability to exercise significant influence using the equity method of accounting. These investments are initially recorded at cost and subsequently adjusted to recognize the Company’s proportionate share of the investee’s net income or loss.
The Company evaluates its equity method investments for impairment whenever events or changes in circumstances indicate that a decline in value may have occurred that is other-than-temporary. This assessment requires significant judgment, including:
Estimating the fair value of the investment, which often involves the use of unobservable (Level 3) inputs when quoted market prices are not available or are not considered representative of fair value;
Analyzing the financial condition, operating results, and business prospects of the investee;
Assessing the severity and duration of any decline in value; and
Evaluating specific factors affecting the investee, such as liquidity constraints, legal proceedings, or changes in the regulatory environment.
If a decline is determined to be other-than-temporary, the Company recognizes an impairment charge in the consolidated statements of operations equal to the excess of the investment’s carrying amount over its estimated fair value. Future changes in the assumptions underlying these estimates could result in material impairment charges.
Non-GAAP Financial Measures
The following discussion and analysis contain a non-GAAP financial measure. Generally, a non-GAAP financial measure is a numerical measure of a company’s performance, financial position or cash flows that either excludes or includes amounts that are not normally included or excluded in the most directly comparable measure calculated and presented in accordance with GAAP. Non-GAAP financial measures should be viewed as supplemental to, and should not be considered as alternative to, net income, operating income, and cash flow from operating activities, liquidity or any other financial measures. Non-GAAP financial measures may not be indicative of the historical operating results of the Company nor are they intended to be predictive of potential future financial results. Investors should not consider non-GAAP financial measures in isolation or as substitutes for performance measures calculated in accordance with GAAP.
Management believes stockholders benefit from referring to the Adjusted EBITDA (a non-GAAP metric) in planning, forecasting, and analyzing future periods. Management uses this non-GAAP financial measure in evaluating its financial and operational decision making and as a means of evaluating period-to-period comparison.
EBITDA, or earnings before interest, taxes, depreciation, and amortization, is an alternative measure of profitability to net income. Management believes Adjusted EBITDA is an important measure of our operating performance because it allows management, investors and analysts to evaluate and assess our core operating results from period to period after removing the impact of significant non-cash and non-recurring charges that affect comparability between reporting periods. We define Adjusted EBITDA as net loss adjusted for non-cash charges for depreciation and amortization, impairment of goodwill, stock compensation, change in contingent consideration, also adjusted for non-recurring other expenses (income), net, loss on investment, and interest income. Our management recognizes that Adjusted EBITDA has inherent limitations because of the excluded items.
We have included a reconciliation of our non-GAAP financial measure to net loss as calculated in accordance with GAAP. We believe that providing the non-GAAP financial measure, together with reconciliation to GAAP, helps investors make comparisons between the Company and other companies. In making any comparisons to other companies, investors need to be aware that companies use different non-GAAP measures to evaluate their financial performance. Investors should pay close attention to specific definitions being used and to the reconciliation between such measures and the corresponding GAAP measures provided by each company under applicable rules of the Securities and Exchange Commission.
