On December 30, 2025, the Company sold substantially all of its manufacturing and operating assets to its former Executive Chairman and former Chief Executive Officer and exited its legacy manufacturing and direct-sales business. In connection with this transaction, the Company entered into a long-term Distribution Agreement pursuant to which the Company now operates as a commission-based distribution agent and no longer manufactures products, owns significant inventory, or incurs costs related to product sourcing, production, warehousing, or distribution.

The sale of substantially all manufacturing and operating assets and the related exit of the legacy business represent a strategic shift that has a major effect on the Company’s operations and financial results. Accordingly, the results of the former manufacturing and direct-sales business have been classified as discontinued operations for all periods presented.

The assets and liabilities of the discontinued operations were disposed of or otherwise derecognized as of December 31, 2025, and no assets or liabilities of discontinued operations remain on the Company’s consolidated balance sheet as of that date.

The following table presents components of discontinued operations, net of tax for the years ended December 31, 2025 and 2024:


	For the Year Ended
	December 31,
	2025			2024
Revenues	$	6,190,179		$	31,992,511
Cost of goods sold		26,197,708			19,017,498
Gross profit		(20,007,529	)		12,975,013

Operating expenses:
General and administrative expenses:
Salaries and benefits		2,423,687			209,815
Other general and administrative expenses		4,044,848			3,231,563
Total general and administrative expenses		6,468,535			3,441,378
Total operating expenses		6,468,535			3,441,378

Net operating income (loss)		(26,476,064	)		9,533,635

Other income (expense):
Interest income		27,266			138,795
Interest expense		(607,121	)		(723,436	)
Loss on early extinguishment of debt		-			(696,502	)
Gain on termination of leases		1,896,276			-
Loss on disposition of assets		(8,658,598	)		-
Total other expense		(7,342,177	)		(1,281,143	)

Income (loss) of discontinued operations before income tax		(33,818,241	)		8,252,492
Income tax provision		-			(123,579	)
Net income (loss)	$	(33,818,241	)	$	8,128,913


Cash received	$	1,500,000
Liabilities assumed by Trea Grove LLC		635,380
Less:
Assets sold:
Assets held for sale		(713,256	)
Construction in process - freeze dryers		(2,768,908	)
Freeze dryers, net		(6,744,473	)
Leasehold improvements, net		(1,459,067	)
Other property plant and equipment, net		(1,778,534	)
Accumulated depreciation		2,670,261
Net loss on disposition of assets		(8,658,598	)
Severance expense		(2,442,500	)
Deal costs		(230,742	)
Loss on sale of assets	$	(11,331,840	)

Balance Sheet

The asset and related liabilities related to the discontinued operations were disposed or derecognized prior to December 31, 2025, therefore the assets and liabilities for the year ended December 31, 2025 represent those of the ongoing operation. Balance sheet amounts from the year ended December 31, 2024 have been reclassified as assets and liabilities related to discontinued operations. The following table represents the assets and liabilities reclassified from their December 31, 2024 presentation.


	December 31,
	2025		2024
Assets of discontinued operation
Accounts receivable, net	$	60,333	$	460,147
Inventory, net		-		20,369,112
Current assets of discontinued operation		60,333		20,829,259
Total property and equipment, net		-		11,673,520
Right of use assets		-		16,258,505
Security deposits		-		1,057,586
Total assets of discontinued operation	$	60,333	$	49,818,870

Liabilities of discontinued operation	December 31, 2024		December 31, 2024
Current portion of operating lease liabilities	$	2,599,102	$	2,473,115
Long term portion of operating lease liabilities		-		15,113,554
Total liabilities of discontinued operation	$	2,599,102	$	17,586,669

During the year ended December 31, 2025, the Company recorded an impairment and write-off of approximately $13,737,675 of inventory that was determined to have no recoverable value. The write-off was initially recorded within cost of goods sold under the Company’s former manufacturing and direct-sales business model, and is included in the net income (loss) of discontinued operations on the Company's Statement of Operations.

During 2025, the Company exited multiple manufacturing and industrial facility leases associated with the discontinued business. As a result of lease termination and modification agreements, the Company recorded noncash gains of $1,896,276 related to the facility lease exits.

Revenue recognized in prior periods under the Company’s former manufacturing and direct-sales business model has been reclassified to loss from discontinued operations for all periods presented. For the year ended December 31, 2025, the Company recognized no revenue from continuing operations, as the Distribution Agreement became effective at year end and no commission

Following the disposition, the Company’s continuing involvement with the former business is limited to our role as an agent who receives commissions from Trea Grove in their role as a Distributor under the Distribution Agreement.