PROSPECTUS SUMMARY

This summary highlights information contained elsewhere in this prospectus. This summary does not contain all of the information you should consider before investing in our securities. You should read this entire prospectus carefully, especially the “Risk Factors” section of this prospectus and our financial statements and the related notes appearing at the end of this prospectus, before making an investment decision. Except as underwritersotherwise indicated, references to “we”, “us”, “our”, “Splash”, “SBG” and the “Company” refer to Splash Beverage Group, Inc. and its wholly owned subsidiaries.

Company Overview

We manufacture, through third party facilities, and distribute several brands of beverages including both non-alcoholic and spirits brands. We believe the distribution landscape in the beverage industry is changing rapidly as tech-enabled e-commerce business models are thriving. Direct to consumer, office or home solutions are projected to continue to gain traction in the future, and our own e-commerce platform, Qplash, which allows us to purchase local and regional brands for developing a direct line of sales at retail stores, is well positioned to take advantage of this anticipated growth.

Our Strategy

Our strategy is to combine the traditional approach of manufacturing, distributing, and marketing of beverages, but with respectbrands that have a reasonable level of pre-existing brand awareness and market presence, or have attributes that we believe to their unsold allotmentsbe purely innovative. These are SBG’s core values. We believe this allows SBG to break through the clutter of numerous brand introductions and dilute risk. This philosophy is applied regardless of whether the brand is 100% owned by SBG or subscriptions.a joint venture. To this end, we intend to own some beverage brands while managing other beverage brands owned by other beverage producers.

4For acquisition or joint venture consideration, we prefer to work with brands that already have one or more of the following in place:

Products

We produce, distribute and market two beverages’ brands: “TapouT Performance”, a hydration and recovery isotonic sport drink and SALT Naturally Flavored Tequila (“SALT”), a 100% agave 80 proof line of flavored tequilas.

CANFIELD MEDICAL SUPPLY, INC.

4120 Boardman-Canfield RoadCopa di Vino Wine Group, Inc.

On December 28, 2020, we completed the acquisition of Copa di Vino Corporation (“Copa di Vino”), the leading producer of premium wine by the glass in the United States.

Through our acquisition of Copa di Vino, we are now able to offer seven varietals of wine: Pinot Grigio, Riesling, Merlot, Chardonnay, White Zinfandel, Moscato, and Cabernet Sauvignon. In addition to its wine varietals, Copa di Vino also produces Pulpoloco, a sangria which is encased in a 100% biodegradable can made from paper. 

E-commerce

“Qplash” is our consumer-packaged goods retail division and our first entry point into the growing e-commerce channel. The division sells beverages and groceries online through www.qplash.com, and third-party storefronts such as Amazon.com and Walmart.com. 

Canfield Ohio 44406Medical Supply, Inc.

SUMMARY OF PROSPECTUS

General Information About Our Company

Canfield Medical Supply, Inc. was incorporated in the State, a provider of Ohio on September 3, 1992, and changed domicile to Colorado on April 18, 2012.  References in this document to “us,” “we,” or “Company” refer to Canfield Medical Supply, Inc.

We provide home medical equipment, supplies and services is a legacy business. In December 2020, management announced our plan to patientsdiscontinue CMS.

Our Competitive Strengths

We believe the following competitive strengths contribute to the Company’s success and differentiate us from our competitors:

Employees

We have eight full-time employees, including non-officer employees and our executive officers, and we retain the services of additional personnel on an independent contractor basis. We do not have any part-time employees but work with several consultants.

Listing on the NYSE American

Our common stock is currently quoted on the OTCQB under the symbol “SBEV”. In connection with this offering, we have applied to list our common stock and warrants on the NYSE American under the symbols “SBEV” and “SBEV WS”, respectively. If our listing application is approved, we expect to list our common stock on the NYSE American upon consummation of the offering, at which point our common stock will cease to be traded on the OTCQB. No assurance can be given that our listing application will be approved. This offering will only be consummated if the NYSE American approves the listing of our common stock and warrants. NYSE American listing requirements include, among other things, a stock price threshold. As a result, prior to effectiveness, if necessary, we intend to take the necessary steps to meet NYSE American listing requirements, including but not limited to consummating a reverse split of our outstanding common stock as further discussed below.

Reverse Stock Split

Prior to the completion of this offering we will effect a one-for-three reverse stock split of our issued and outstanding common stock in order to satisfy NYSE American listing requirements and obtain NYSE American approval for listing of our common stock. Unless otherwise indicated all share and price amounts assume that the reverse split has been effected.

Risks Affecting Our Business

Our business is subject to numerous risks as described in the Mahoning Valleysection entitled “Risk Factors” and elsewhere in this prospectus. You should carefully consider these risks before making an investment. Some of Northeastern Ohio, Western Pennsylvania and Northern West Virginia.  More than 50% of our revenue is derived from the sale and rental of durable home medical equipment including such items as power wheelchairs, hospital beds, miscellaneous ramps, bedside commodes, and miscellaneous bathroom equipment.  The balance of our revenue is from the sale of various home medical supplies including diabetic testing, incontinence, ostomy, wound care, and catheter supplies.  these risks include:

Corporate Information

Our emphasis is on helping patients with mobility related limitations, but our overall business is aimed at helping patients remain in their homes instead of having to go to hospitals, rehab centers and other similar facilities.  Our services primarily consist of providing in-home delivery, set-up and maintenance of the equipment we sell or lease. Our headquartersprincipal offices are located at 4120 Boardman-Canfield Road, Canfield, Ohio  44406.1314 E. Las Olas Blvd, Suite 221, Fort Lauderdale, Florida 33301. Our phonemain telephone number at is (954) 745-5815. Our website address is www.splashbeveragegroup.com. We have not incorporated by reference into this prospectus what can be accessed through our headquarters is (330) 533-1914. Our fiscal year end is December 31.website and you should not consider it to be part of this prospectus.

THE OFFERING

The Offering

Following is a brieffollowing summary of this offering. Please see the Plan of Distribution section foroffering contains basic information about the offering and our securities and is not intended to be complete. It does not contain all the information that is important to you. For a more detailed descriptioncomplete understanding of our securities, please refer to the termssection of the offering.this prospectus entitled “Description of Securities.”

SUMMARY FINANCIAL INFORMATION

The following tables present summary financial data for SBG. We derived the summary statements of operations data for the three months ended March 31, 2021 and 2020 and the balance sheet data as of March 31, 2021 from the unaudited financial statements of SBG and the summary statements of operations data for the years ended December 31, 2020 and 2019 and the balance sheet data as of December 31, 2020 and 2019 from the audited financial statements of SBG included elsewhere in this prospectus. Our historical results are not necessarily indicative of the results that may be expected in the future. You should read this data together with our financial statements and related notes included elsewhere in this prospectus and the information in the sections of this prospectus titled “Selected Financial Data” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

Splash Beverage Group, Inc.

RISK FACTORS

An investmentYou should carefully consider the risks described below as well as other information provided to you in these securities involves an exceptionally high degreethis document, including information in the section of risk and is extremely speculative in nature. Following are what we believe are allthis document entitled “Cautionary Note Concerning Forward-Looking Statements.” If any of the materialfollowing risks involved ifactually occur, the Company’s business, financial condition or results of operations could be materially adversely affected, the value of the Company’s Common Stock could decline, and you decidemay lose all or part of your investment.

Risks Related to our Business

The impact of COVID-19 continues to create considerable uncertainty for our business.

Our operations continue to expose us to risks associated with the COVID-19 outbreak. Authorities around the world have implemented numerous measures to try to reduce the spread of the virus and such measures have impacted and continue to impact us, our business partners, and consumers. While some of these measures have been lifted or eased in certain jurisdictions, other jurisdictions have seen a resurgence of COVID-19 cases resulting in reinstitution or expansion of such measures.

We have seen and could continue to see changes in consumer demand as a result of COVID-19, including the inability of consumers to purchase sharesour products due to illness, quarantine or other restrictions, store closures, or financial hardship. We also continue to see shifts in this offering.product and channel preferences, particularly an increase in demand in the e-commerce channel, which has impacted and could continue to impact our sales and profitability. Reduced demand for our products or changes in consumer purchasing patterns, as well as continued economic uncertainty, can adversely affect our customers’ financial condition, which can result in bankruptcy filings and/or an inability to pay for our products. In addition, we may also continue to experience business disruptions as a result of COVID-19, resulting from temporary closures of our facilities or facilities of our business partners or the inability of a significant portion of our or our business partners’ workforce to work because of illness, quarantine, or travel or other governmental restrictions. Any sustained interruption in our or our business partners’ operations, distribution network or supply chain or any significant continuous shortage of raw materials or other supplies, including personal protective equipment or sanitization products, can negatively impact our business. We have also incurred, and expect to continue to incur, increased employee and operating costs as a result of COVID-19, which have negatively impacted and may continue to negatively impact our profitability. In addition, the increase in certain of our employees working remotely has resulted in increased demand on our information technology infrastructure, which can be subject to failure, disruption or unavailability, and increased vulnerability to cyberattacks and other cyber incidents. Also, continued economic uncertainty associated with the COVID-19 outbreak has resulted in volatility in the global capital and credit markets which can impair our ability to access these markets on terms commercially acceptable to us, or at all.

RISKS ASSOCIATED WITH OUR COMPANY:The impact of COVID-19 has heightened, or in some cases manifested, certain of the other risks discussed herein. The extent of the impact of the COVID-19 outbreak on our business remains uncertain and will continue to depend on numerous evolving factors that we are not able to accurately predict and which will vary by jurisdiction and market, including the duration and scope of the pandemic, the development and availability of effective treatments and vaccines, global economic conditions during and after the pandemic, governmental actions that have been taken, or may be taken in the future, in response to the pandemic, and changes in consumer behavior in response to the pandemic, some of which may be more than just temporary.

Our Auditors have issuedIf we are unable to continue as a going concern, opinion because weour securities will have suffered losses fromlittle or no value.

Although our operationsaudited financial statements for the fiscal year ended December 31, 2011 and2020 were prepared under the nine monthsassumption that we would continue our operations as a going concern, the report of our independent registered public accounting firm that accompanies our financial statements for the year ended September 30, 2012 and we haveDecember 31, 2020 contains a negative working capital and stockholders’ equity deficit.  These conditions raisegoing concern qualification in which our independent registered public accounting firm expressed substantial doubt about our ability to continue as a going concern.

Basedconcern, based on ourthe financial statements at that time. Specifically, we have sustained recurring losses for our last fiscal year and our last six months combined with our negativewe have had a working capital and stockholders’ equity deficit,deficits. These prior losses and expected future losses have had, and will continue to have, an adverse effect on our independent registered public accounting firm has expressed substantial doubt as tofinancial condition. In addition, continued operations and our ability to continue as a going concern.  As discussedconcern may be dependent on our ability to obtain additional financing in the next risk factor,near future and thereafter, and there are no assurances that such financing will be available to us at all or will be available in sufficient amounts or on reasonable terms. Our financial statements do not include any adjustments that may result from the January 2011 changeoutcome of this uncertainty. If we are unable to generate additional funds in Medicare’s reimbursement policy for power wheel chairs has adversely affected our business and this has forced us to adjust the focusfuture through sales of our business to theproducts, financings or from other products we carry.  We are also attempting to increase our private pay business in our primary market and we are seeking to win onesources or more competitive bids in round 2 of Medicare Competitive Bidding in four more markets in Ohio.  Even if we are successful in one or more of these endeavors,transactions, we will exhaust our resources and will be unable to continue operations. If we cannot continue as a going concern, our shareholders would likely lose most likely needor all of their investment in us.

We have experienced recurring losses from operations and negative cash flows from operating activities and anticipate that we will continue to raise additional financing if we raise less than $50,000 in this offering.  We need the additional financing to cover any additionalincur significant operating losses in the future.

We have experienced recurring losses from operations and negative cash flows from operating activities.  We expect to help pay for any additional marketing expenses we needcontinue to incur significant expenses related to our ongoing operations and to help pay down our current liabilities.  

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We have lost moneygenerate operating losses for the last twenty-one monthsforeseeable future. The size of our losses will depend, in part, on the rate of future expenditures and we may not achieve or maintain profitability in the future.

Duringour ability to generate revenues.  We incurred a net loss of $28.7 million for the year ended December 31, 20112020 and $4.4 million for the quarter ended March 31, 2021. Our accumulated deficit increased to $61.6 million as of December 31, 2020 compared to the prior year’s deficit of $31.8 million. Our accumulated deficit was $66.0 million as of March 31, 2021.

We may encounter unforeseen expenses, difficulties, complications, delays, and other unknown factors that may adversely affect our financial condition. Our prior losses and expected future losses have had, and will continue to have, an adverse effect on our financial condition. If our products do not achieve sufficient market acceptance and our revenues do not increase significantly, we hadmay never become profitable. Even if we achieve profitability in the future, we may not be able to sustain profitability in subsequent periods. Our failure to become and remain profitable would decrease the value of our company and could impair our ability to raise capital, expand our business, diversify our product offerings or continue our operations. A decline in the value of our company could cause you to lose all or part of your investment.

If we are not able to successfully execute on our future operating plans and objectives, our financial condition and results of operation may be materially adversely affected, and we may not be able to continue as a net lossgoing concern.

It is important that we meet our sales goals and increase sales going forward as our operating plan already reflects prior significant cost containment measures and may make it difficult to achieve top-line growth if further significant reductions become necessary. If we do not meet our sales goals, our available cash and working capital will decrease and our financial condition will be negatively impacted.

In order to be successful, we believe that we must, among other things:

We may not be able to meet these objectives, which could have a material adverse effect on our results of $53,096operations. We have incurred significant operating expenses in the past and duringmay do so again in the nine months ended September 30, 2012 we hadfuture and, as a net lossresult, will need to increase revenues in order to improve our results of $3,412.operations. Our business wasability to increase sales will depend primarily on success in expanding our current markets, improving our distribution base, entering into Direct-To-Retail (DTR) arrangements with national accounts, and introducing new brands, products or product extensions to the market. Our ability to successfully enter new distribution areas and obtain national accounts will, in turn, depend on various factors, many of which are beyond our control, including, but not limited to, the continued demand for our brands and products in target markets, the ability to price our products at competitive levels, the ability to establish and maintain relationships with distributors in each geographic area of distribution and the ability in the future to create, develop and successfully introduce one or more new brands, products, and product extensions.

Demand for our products may be adversely affected by changes in consumer preferences or any inability on our part to innovate, market or distribute our products effectively, and any significant reduction in demand could adversely affect our business, financial condition or results of operations.

Our beverage portfolio is comprised of a January 2011number of unique brands with reputations and consumer imagery that have been built over time. Our investments in marketing as well as our strong commitment to product quality are intended to have a favorable impact on brand image and consumer preferences. If we do not adequately anticipate and react to changing demographics, consumer and economic trends, health concerns and product preferences, our financial results could be adversely affected.

Additionally, failure to introduce new brands, products or product extensions into the marketplace as current ones mature and to meet the changing preferences of consumers could prevent us from gaining market share and achieving long-term profitability. Product lifecycles can vary and consumer preferences and loyalties change over time. Although we try to anticipate these shifts and innovate new products to introduce to our consumers, we may not succeed. Consumer preferences also are affected by factors other than taste, such as health and nutrition considerations and obesity concerns, shifting consumer needs, changes in Medicare’s reimbursement policy for power wheel chairs when Medicare quit reimbursing the purchase of power wheel chairsconsumer lifestyles, increased consumer information and started only reimbursing the rental of such wheel chairs.  Approximately 13%competitive product and pricing pressures. Sales of our revenuesproducts may be adversely affected by the negative publicity associated with these issues. In addition, there may be a decreased demand for certain products as a result of the COVID-19 outbreak. If we do not adequately anticipate or adjust to respond to these and other changes in consumer preferences, we may not be able to maintain and grow our brand image and our sales may be adversely affected.

Volatility in the year ended December 31, 2010 were derivedprice or availability of the inputs we depend on, including raw materials, packaging, energy and labor, could adversely impact our financial results.

The principal raw materials we use include glass bottles, aluminum cans, labels and cardboard cartons, flavorings and sweeteners. These ingredient costs are subject to fluctuation. Substantial increases in the prices of our ingredients, raw materials and packaging materials, to the extent that they cannot be recouped through increases in the prices of finished beverage products, would increase our operating costs and could reduce our profitability. If our supply of these raw materials is impaired or if prices increase significantly, it could affect the affordability of our products and reduce sales.

If we are unable to secure sufficient ingredients or raw materials including glass, sugar, and other key supplies, we might not be able to satisfy demand on a short-term basis.

Changes in government regulation or failure to comply with existing regulations could adversely affect our business, financial condition and results of operations.

Our business and properties are subject to various federal, state and local laws and regulations, including those governing the production, packaging, quality, labeling and distribution of beverage products. In addition, various governmental agencies have enacted or are considering additional taxes on soft drinks and other sweetened beverages. Changes in existing laws or regulations could require material expenses and negatively affect our financial results through lower sales or higher costs.

We compete in an industry that is brand-conscious, so brand name recognition and acceptance of our products are critical to our success.

Our business is dependent upon awareness and market acceptance of our products and brands by our target market, trendy, young consumers looking for a distinctive tonality in their beverage choices. In addition, our business depends on acceptance by our independent distributors and retailers of our brands as beverage brands that have the potential to provide incremental sales growth. If we are not successful in the revitalization and growth of our brand and product offerings, we may not achieve and maintain satisfactory levels of acceptance by independent distributors and retail consumers. In addition, we may not be able to effectively execute our marketing strategies in light of the various closures and event cancellations caused by the COVID-19 outbreak. Any failure of our brand to maintain or increase acceptance or market penetration would likely have a material adverse effect on our revenues and financial results.

Our brands and brand images are keys to our business and any inability to maintain a positive brand image could have a material adverse effect on our results of operations.

Our success depends on our ability to maintain brand image for our existing products and effectively build up brand image for new products and brand extensions. We cannot predict whether our advertising, marketing and promotional programs will have the desired impact on our products’ branding and on consumer preferences. In addition, negative public relations and product quality issues, whether real or imagined, could tarnish our reputation and image of the affected brands and could cause consumers to choose other products. Our brand image can also be adversely affected by unfavorable reports, studies and articles, litigation, or regulatory or other governmental action, whether involving our products or those of our competitors.

Competition from traditional and large, well-financed non-alcoholic and alcoholic beverage manufacturers may adversely affect our distribution relationships and may hinder development of our existing markets, as well as prevent us from expanding our markets.

The beverage industry is highly competitive. We compete with other beverage companies not only for consumer acceptance but also for shelf space in retail outlets and for marketing focus by our distributors, all of whom also distribute other beverage brands. Our products compete with all non-alcoholic and alcoholic beverages, most of which are marketed by companies with substantially greater financial resources than ours. Some of these competitors are placing severe pressure on independent distributors not to carry competitive brands such as ours. We also compete with regional beverage producers and “private label” hydration suppliers.

Increased competitor consolidations, marketplace competition, particularly among branded beverage products, and competitive product and pricing pressures could impact our earnings, market share and volume growth. If, due to such pressure or other competitive threats, we are unable to sufficiently maintain or develop our distribution channels, we may be unable to achieve our current revenue and financial targets. Competition, particularly from companies with greater financial and marketing resources than ours, could have a material adverse effect on our existing markets, as well as on our ability to expand the market for our products.

We may experience a reduced demand for some of our products due to health concerns (including obesity) and legislative initiatives against sweetened beverages.

Consumers are concerned about health and wellness; public health officials and government officials are increasingly vocal about obesity and its consequences. There has been a trend among some public health advocates and dietary guidelines to recommend a reduction in sweetened beverages, as well as increased public scrutiny, new taxes on sugar-sweetened beverages (as described below), and additional governmental regulations concerning the marketing and labeling/packing of the beverage industry. Additional or revised regulatory requirements, whether labeling, tax or otherwise, could have a material adverse effect on our financial condition and results of operations. Further, increasing public concern with respect to sweetened beverages could reduce demand for our beverages and increase desire for more low-calorie soft drinks, water, enhanced water, coffee-flavored beverages, tea, and beverages with natural sweeteners. We are continuously working to reduce calories and sugar in our TapouT products while launching new products, to pair with existing brand extensions that round out our diversified portfolio.

Legislative or regulatory changes that affect our products, including new taxes, could reduce demand for products or increase our costs.

Taxes imposed on the sale of power chairs.  This has forced us to adjust the focuscertain of our products by federal, state and local governments in the United States, or other countries in which we operate could cause consumers to shift away from purchasing our beverages. Several municipalities in the United States have implemented or are considering implementing taxes on the sale of certain “sugared” beverages, including non-diet soft drinks, fruit drinks, teas and flavored waters to help fund various initiatives. These taxes could materially affect our business and financial results.

Our reliance on distributors, retailers and brokers could affect our ability to theefficiently and profitably distribute and market our products, maintain our existing markets and expand our business into other products we carry.  We are gradually making this change and we will continue to focus on our more profitable products and services.  We are also attempting to increase our private pay business in our primary market and we are seeking to win one or more competitive bids in Round 2 of Medicare Competitive Bidding in four more markets in Ohio.geographic markets.

Our ability to generatemaintain and sustain significant additional revenuesexpand our existing markets for our products, and to establish markets in new geographic distribution areas, is dependent on our ability to establish and maintain successful relationships with reliable distributors, retailers and brokers strategically positioned to serve those areas. Most of our distributors, retailers and brokers sell and distribute competing products, including non-alcoholic and alcoholic beverages, and our products may represent a small portion of their businesses. The success of this network will depend uponon the factors discussed elsewhereperformance of the distributors, retailers and brokers of this network. There is a risk that the mentioned entities may not adequately perform their functions within the network by, without limitation, failing to distribute to sufficient retailers or positioning our products in this “Risk Factors” section. We cannot assure youlocalities that may not be receptive to our product. Our ability to incentivize and motivate distributors to manage and sell our products is affected by competition from other beverage companies who have greater resources than we will achieve or sustain profitability ordo. To the extent that our operating lossesdistributors, retailers and brokers are distracted from selling our products or do not employ sufficient efforts in managing and selling our products, including re-stocking the retail shelves with our products, our sales and results of operations could be adversely affected. Furthermore, such third-parties’ financial position or market share may deteriorate, which could adversely affect our distribution, marketing and sales activities.

Our ability to maintain and expand our distribution network and attract additional distributors, retailers and brokers will depend on a number of factors, some of which are outside our control. Some of these factors include:

We may not increasebe able to successfully manage all or any of these factors in any of our current or prospective geographic areas of distribution. Our inability to achieve success with regards to any of these factors in a geographic distribution area will have a material adverse effect on our relationships in that particular geographic area, thus limiting our ability to maintain or expand our market, which will likely adversely affect our revenues and financial results.

It is difficult to predict the timing and amount of our sales because our distributors are not required to place minimum orders with us.

Our independent distributors and national accounts are not required to place minimum monthly or annual orders for our products. In order to reduce their inventory costs, independent distributors typically order products from us on a “just in time” basis in quantities and at such times based on the demand for the products in a particular distribution area. Accordingly, we cannot predict the timing or quantity of purchases by any of our independent distributors or whether any of our distributors will continue to purchase products from us in the future. same frequencies and volumes as they may have done in the past. Additionally, our larger distributors and national partners may make orders that are larger than we have historically been required to fill.  Shortages in inventory levels, supply of raw materials or other key supplies could negatively affect us.

If we do achieve profitability, we cannotnot adequately manage our inventory levels, our operating results could be certain that we can sustain or increase profitabilityadversely affected.

We need to maintain adequate inventory levels to be able to deliver products to distributors on a quarterlytimely basis. Our inventory supply depends on our ability to correctly estimate demand for our products. Our ability to estimate demand for our products is imprecise, particularly for new products, seasonal promotions and new markets. If we materially underestimate demand for our products or annual basis in the future.  Failureare unable to generatemaintain sufficient revenues or additional financing when needed could cause us to go outinventory of business.

Due to a shortage of capital our marketing activities have been limited, and that will continue unlessraw materials, we aremight not be able to raise additional financing.

In order to growsatisfy demand on a short-term basis. If we overestimate distributor or retailer demand for our business,products, we will need to developmay end up with too much inventory, resulting in higher storage costs, increased trade spend and maintain wider spread recognition and acceptancethe risk of our Company and our products. We plan to rely primarily on word of mouth from our existing contacts we have developed to promote and market ourselves and we plan to use some of the funds from this offering to develop a website.  To date, marketing and advertising expenses have been negligible.inventory spoilage. If we fail to successfully market and promotemanage our business,inventory to meet demand, we could lose potential business todamage our competitors, orrelationships with our growth efforts may be ineffective. If we incur significant expenses promotingdistributors and marketing ourselves, itretailers and could delay or completely forestalllose sales opportunities, which would unfavorably impact our profitability.future sales and adversely affect our operating results. In addition, if the inventory of our products held by our distributors and retailers is too high, they will not place orders for additional products, which would also unfavorably impact our sales and adversely affect our operating results.

We may needIf we fail to raise additional funds, and if these funds are not available when we need them,maintain relationships with our independent contract manufacturers, our business willcould be harmedharmed..

AlthoughWe do not manufacture our products but instead outsource the manufacturing process to third-party bottlers and independent contract manufacturers (co-packers). We do not own the plants or the majority of the equipment required to manufacture and package our beverage products, and we lost $53,096do not anticipate bringing the manufacturing process in-house in the year ended December 31, 2011future. Our ability to maintain effective relationships with contract manufacturers and $3,412other third parties for the production and delivery of our beverage products in a particular geographic distribution area is important to the nine months ended September 30, 2012, and we had a working capital deficitsuccess of $73,395 on September 30, 2012, we believe that we could continue to operate our business for another year without raising any financing or winning any of the Medicare bids we have made, but we would probably have to cut more costs and our President might have to defer some of his salary.  These cost cuts might require that we reduce our current staff by 1 or 2 part-time positions.  However, if our forecasts are inaccurate, we will most likely need to raise additional funds.operations within each distribution area. We cannot assure that additional financing will be available when needed on favorable terms, or at all, and if it is not available our business will be harmed.

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Our President may not be willingable to help fundmaintain our operations whenrelationships with current contract manufacturers or establish satisfactory relationships with new or replacement contract manufacturers, whether in existing or new geographic distribution areas. The failure to establish and maintain effective relationships with contract manufacturers for a distribution area could increase our manufacturing costs and thereby materially reduce gross profits from the sale of our products in that area. Poor relations with any of our contract manufacturers could adversely affect the amount and timing of product delivered to our distributors for resale, which would in turn adversely affect our revenues and financial condition. In addition, our agreements with our contract manufacturers are terminable at any time, and any such funding is necessary and thistermination could limitdisrupt our ability to succeeddeliver products to our customers.

The volatility of energy and increased regulations may have an adverse impact on our gross margin.

Over the past few years, volatility in the global oil markets has resulted in variable fuel prices, which many shipping companies have passed on to their customers by way of higher base pricing and increased fuel surcharges.  If fuel prices increase, we expect to experience higher shipping rates and fuel surcharges, as well as energy surcharges on our raw materials.  It is hard to predict what will happen in the fuel markets in 2021 and beyond. Due to the price sensitivity of our products, we may not be able to pass such increases on to our customers.

Disruption within our supply chain, contract manufacturing or force us outdistribution channels could have an adverse effect on our business, financial condition and results of businessoperations. .

Our President has indicated that he may be willingability, through our suppliers, business partners, contract manufacturers, independent distributors and retailers, to help fundmake, move and sell products is critical to our operationssuccess. Damage or disruption to our suppliers or to manufacturing or distribution capabilities due to weather, natural disaster, fire or explosion, terrorism, pandemics such as influenza COVID-19, labor strikes or other reasons, could impair the manufacture, distribution and sale of our products. Many of these events are outside of our control. Failure to take adequate steps to protect against or mitigate the likelihood or potential impact of such events, or to effectively manage such events if they occur, could adversely affect our business, financial condition and results of operations.

We rely upon our ongoing relationships with our key flavor suppliers. If we are unable to source our flavors on a limited basisacceptable terms from our key suppliers, we could suffer disruptions in orderour business.

We currently purchase our flavor concentrate from various flavor concentrate suppliers, and continually develop other sources of flavor concentrate for each of our products. Generally, flavor suppliers hold the proprietary rights to continuetheir flavor-specific ingredients. Although we have the business, but there are no agreementsexclusive rights to flavor concentrates developed with him to do so.  If he is not willing to help fundour current flavor concentrate suppliers, and while we have the business by deferring a portion of his salary or by making a small loanrights to the Company,ingredients for our business would be negatively impacted and it could even force us out of business.

Becauseproducts, we are small, have a working capital deficit, and do not have much capital,the list of ingredients for our flavor extracts and concentrates. Consequently, we willmay be very limitedunable to obtain these exact flavors or concentrates from alternative suppliers on short notice. If we have to replace a flavor supplier, we could experience disruptions in our ability to expanddeliver products to our business.customers, which could have a material adverse effect on our results of operations.

BecauseIf we are small, have a working capital deficit,unable to attract and do not have much capital, we are limitedretain key personnel, our efficiency and operations would be adversely affected; in addition, management turnover causes uncertainties and could harm our business.

Our success depends on our ability to expandattract and retain highly qualified employees in such areas as finance, sales, marketing and product development. We compete to hire new employees, and, in some cases, must train them and develop their skills and competencies. We may not be able to provide our employees with competitive salaries, and our operating results could be adversely affected by increased costs due to increased competition for employees, higher employee turnover or increased employee benefit costs.

Further, to the extent we experience additional management turnover, our operations, financial condition and employee morale could be negatively impacted.  In addition, competition for top management is high and it may take months to find a candidate that meets our requirements. If we are unable to attract and retain qualified management personnel, our business beyondcould suffer. Moreover, our operations could be negatively affected if employees are quarantined as the Mahoning Valleyresult of exposure to a contagious illness such as COVID-19.

If we lose the services of our Chief Executive Officer, our operations could be disrupted and our business could be harmed.

Our business plan relies significantly on the continued services of Robert Nistico, our Chief Executive Officer. If we were to lose the services of Mr. Nistico, our ability to execute our business plan could be materially impaired. We are not aware of any facts or circumstances that suggest he might leave us.

If we fail to protect our trademarks and trade secrets, we may be unable to successfully market our products and compete effectively.

We rely on a combination of trademark and trade secrecy laws, confidentiality procedures and contractual provisions to protect our intellectual property rights. Failure to protect our intellectual property could harm our brand and our reputation, and adversely affect our ability to compete effectively. Further, enforcing or defending our intellectual property rights, including our trademarks, copyrights, licenses and trade secrets, could result in the expenditure of significant financial and managerial resources. We regard our intellectual property, particularly our trademarks and trade secrets to be of considerable value and importance to our business and our success, and we actively pursue the registration of our trademarks in the United States and internationally. However, the steps taken by us to protect these proprietary rights may not be adequate and may not prevent third parties from infringing or misappropriating our trademarks, trade secrets or similar proprietary rights. In addition, other parties may seek to assert infringement claims against us, and we may have to pursue litigation against other parties to assert our rights. Any such claim or litigation could be costly. In addition, any event that would jeopardize our proprietary rights or any claims of infringement by third parties could have a material adverse effect on our ability to market or sell our brands, profitably exploit our products or recoup our associated research and development costs.

As part of the licensing strategy of our brands, we enter into licensing agreements under which we grant our licensing partners certain rights to use our trademarks and other geographical areas.designs. Although our agreements require that the use of our trademarks and designs is subject to our control and approval, any breach of these provisions, or any other action by any of our licensing partners that is harmful to our brands, goodwill and overall image, could have a material adverse impact on our business.

We may be required in the future to record a significant charge to earnings if our goodwill or intangible assets become impaired.

Under United States Generally Accepted Accounting Principles (“U.S. GAAP”), we are biddingrequired to review our intangible assets for Medicare qualificationimpairment when events or changes in Akron, Columbus, Daytoncircumstances indicate the carrying value may not be recoverable. Factors that may be considered a change in circumstances indicating that the carrying value of our intangible assets may not be recoverable include, declining or slower than anticipated growth rates for certain of our existing products, a decline in stock price and Toledo,market capitalization, and slower growth rates in our industry.

We may be required in the future to record a significant charge to earnings during the period in which we determine that our intangible assets have keptbeen impaired. Any such charge would adversely impact our bid capacities withinresults of operations. As of December 31, 2020, our goodwill totaled approximately $5.7 million and as of March 31, 2021, our goodwill totaled approximately $5.7 million.

If we encounter product recalls or other product quality issues, our business may suffer.

Product quality issues, real or imagined, or allegations of product contamination, even when false or unfounded, could tarnish our image and could cause consumers to choose other products. In addition, because of changing government regulations or implementation thereof, or allegations of product contamination, we may be required from time to time to recall products entirely or from specific markets. Product recalls could affect our profitability and could negatively affect brand image.

Our business is subject to many regulations and noncompliance is costly.

The production, marketing and sale of our beverages, including contents, labels, caps and containers, are subject to the rules and regulations of various federal, provincial, state and local health agencies. If a rangeregulatory authority finds that a current or future product or production batch or “run” is not in compliance with any of these regulations, we do not anticipate will create a need to expandmay be fined, or production may be stopped, which would adversely affect our current facility in Canfield, Ohiofinancial condition and results of operations. Similarly, any adverse publicity associated with any noncompliance may damage our reputation and our ability to successfully market our products. Furthermore, the rules and regulations are subject to change from time to time and while we closely monitor developments in this area, we cannot anticipate whether changes in these rules and regulations will impact our business adversely. Additional or revised regulatory requirements, whether labeling, environmental, tax or otherwise, could have a material adverse effect on our financial condition and results of operations.

Significant additional labeling or warning requirements may inhibit sales of affected products.

Various jurisdictions may seek to adopt significant additional product labeling or warning requirements relating to the chemical content or perceived adverse health consequences of certain of our products. These types of requirements, if they become applicable to one or more of our products under current staffor future environmental or health laws or regulations, may inhibit sales of employees should havesuch products. In California, a law requires that a specific warning appear on any product that contains a component listed by the state as having been found to cause cancer or birth defects. This law recognizes no difficulty handlinggenerally applicable quantitative thresholds below which a warning is not required. If a component found in one of our products is added to the additionallist, or if the increasing sensitivity of detection methodology that may become available under this law and related regulations as they currently exist, or as they may be amended, results in the detection of an infinitesimal quantity of a listed substance in one of our beverages produced for sale in California, the resulting warning requirements or adverse publicity could affect our sales.

Litigation or legal proceedings could expose us to significant liabilities and damage our reputation.

We may become party to litigation claims and legal proceedings. Litigation involves significant risks, uncertainties and costs, including distraction of management attention away from our business upoperations. We evaluate litigation claims and legal proceedings to assess the likelihood of unfavorable outcomes and to estimate, if possible, the amount of potential losses. Based on these assessments and estimates, we establish reserves and disclose the bid,relevant litigation claims or legal proceedings, as appropriate. These assessments and estimates are based on the information available to management at the time and involve a significant amount of management judgment. Actual outcomes or losses may differ materially from those envisioned by our current assessments and estimates. Our policies and procedures require strict compliance by our employees and agents with all U.S. and local laws and regulations applicable to our business operations, including those prohibiting improper payments to government officials. Nonetheless, our policies and procedures may not ensure full compliance by our employees and agents with all applicable legal requirements. Improper conduct by our employees or agents could damage our reputation or lead to litigation or legal proceedings that could result in civil or criminal penalties, including substantial monetary fines, as well as disgorgement of profits.

Additionally, there has been public attention directed at the beverage alcohol industry, which we believe is due to concern over problems related to harmful use of alcohol, including drinking and driving, underage drinking and health consequences from the misuse of alcohol. We could be exposed to lawsuits relating to product liability or marketing or sales practices with respect to our alcoholic products. Adverse developments in lawsuits concerning these types of matters or a significant decline in the social acceptability of beverage alcohol products that may result.  

Continued reductions in Medicare and Medicaid reimbursement ratesresult from lawsuits could have a material adverse effect on our business, results of operations andliquidity, financial condition.

There are ongoing legislative and regulatory efforts to reduce or otherwise adversely affect Medicare and Medicaid reimbursement rates for products and services we provide. For example, the regulations implementing the mandates under the Deficit Reduction Act of 2005 (“DRA”); the Medicare Improvements for Patients and Providers Act (“MIPPA”), which became law in 2008 and the comprehensive healthcare reform law signed in March 2010 (“the Reform Package”), reduced the reimbursement for a number of products and services we provide and established or expanded a competitive bidding program for certain durable medical equipment under Medicare Part B.  The Medicare competitive bidding program for providers of durable medical equipment, prosthetics, orthotics, and supplies (“DMEPOS”) is intended to further reduce reimbursement for certain products and to decrease the number of companies permitted to serve Medicare beneficiaries. In July 2008, MIPPA was passed and included a delay to the competitive bidding program. In order to ensure that the delay would achieve the same level of savings projected for the DMEPOS competitive bidding program, Congress adopted a nationwide average payment reduction of 9.5% in the DMEPOS fee schedule for those product categories included in Round 1, effective January 1, 2009.

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In 2009, the Centers for Medicare and Medicaid Services (“CMS”) released an interim final rule implementing certain MIPPA provisions requiring CMS to conduct the Round 1 Rebid and mandated certain changes for both the Round 1 Rebid and subsequent rounds of the program.  In November 2010, CMS published a final rule containing several provisions related to the competitive bidding program. We were not affected by Round 1 Competitive Bidding as our geographical area was not included.  However, in August 2011, CMS announced that Round 2 would include the majority of the same product categories, but also include (i) a new product category including standard power wheelchairs and manual wheelchairs, and (ii) Support Surfaces (Group 2 mattresses and overlays) in all Round 2 markets.  Assuming the bidding rules for Round 2 are similar to the Round 1 Rebid, we estimate that approximately $50,000 of our net revenues for the fiscal year ending December 31, 2011 would be subject to Round 2 competitive bidding. The bidding process for Round 2 was completed in January 2012 and the new Round 2 rates and guidelines are currently scheduled to take effect in July of 2013. We cannot estimate the impact of potential Round 2 rate reductions or our ability to win competitively bid contracts on our business until more specific information is published by CMS and its contractorscondition and results of operations.

We are subject to risks inherent in sales of products in international markets.

Our operations outside of the Round 2 bidding process are announced.United States contribute to our revenue and profitability, and we believe that developing and emerging markets could present future growth opportunities for us.  However, there can be no assurance that existing or new products that we manufacture, distribute or sell will likely experience significant pricing reductions onbe accepted or be successful in any bids we win and loss of revenue for bids we did not win.

particular foreign market, due to local or global competition, product price, cultural differences, consumer preferences or otherwise.  There are also ongoing state and federal legislative and regulatory efforts to reduce or otherwisemany factors that could adversely affect Medicaid reimbursement ratesdemand for our products in foreign markets, including our inability to attract and services we provide. For a number of years, some states have adopted alternative pricing methodologies for certain drugs, biologicals and home medical equipment reimbursed under the Medicaid program.  We are currently not aware of any reimbursement reductions planned for Ohio Medicaid, but that could changemaintain key distributors in these markets; volatility in the near future.  We will periodically evaluateeconomic growth of certain of these markets; changes in economic, political or social conditions, the possibilitystatus of stoppingthe implementation of the United States – Mexico – Canada Agreement, which replaced the North American Free Trade Agreement, imposition of new or reducingincreased labeling, product or production requirements, or other legal restrictions; restrictions on the import or export of our Medicaid business in Ohio if reimbursement policies make it difficult for us to conduct operations profitably. Moreover, the Reform Package increases Medicaid enrollment over a number of years and imposes additional requirements on states, which could further strain state budgets and therefore result in additional policy changesproducts or rate reductions.  The President’s most recent budget proposal would limit the amount state Medicaid programs pay for DMEPOS services and products to be no higher than Medicare’s rates, including those impacted by the competitive bidding program. We cannot currently predict the adverse impact, if any, that any such changes toingredients or reductionsubstances used in our Medicaidproducts; currency inflation, devaluation or fluctuation; and increased costs of doing business might have on our operations, cash flowdue to compliance with complex foreign and capital resources, but such impact could be material.

We cannot estimateU.S. laws and regulations. If we are unable to effectively operate or manage the ultimate impact of all legislated and contemplated Medicare and Medicaid reimbursement changes or provide assurance to investors that additional reimbursement reductions will not be made or will not have a material adverse effect onrisks associated with operating in international markets, our business, financial condition or results of operations cash flow, capitalcould be adversely affected.

Climate change may negatively affect our business.

There is growing concern that a gradual increase in global average temperatures may cause an adverse change in weather patterns around the globe resulting in an increase in the frequency and severity of natural disasters. While warmer weather has historically been associated with increased sales of products similar to ours, changing weather patterns could have a negative impact on agricultural productivity, which may limit availability or increase the cost of certain key ingredients. Also, increased frequency or duration of extreme weather conditions may disrupt the productivity of our facilities, the operation of our supply chain or impact demand for our products. In addition, the increasing concern over climate change may result in more regional, federal and global legal and regulatory requirements and could result in increased production, transportation and raw material costs. As a result, the effects of climate change could have a long-term adverse impact on our business and results of operations. 

Water scarcity and poor quality could negatively impact our costs and capacity.

Water is a main ingredient in substantially all of our products, is vital to the production of the agricultural ingredients on which our business relies and is needed in our manufacturing process. It also is critical to the prosperity of the communities we serve. Water is a limited resource in many parts of the world, facing unprecedented challenges from overexploitation, increasing demand for food and other consumer and industrial products whose manufacturing processes require water, increasing pollution and emerging awareness of potential contaminants, poor management, lack of physical or financial access to water, sociopolitical tensions due to lack of public infrastructure in certain areas of the world and the effects of climate change. As the demand for water continues to increase around the world, and as water becomes scarcer and the quality of available water deteriorates, we may incur higher costs or face capacity constraints and the possibility of reputational damage, which could adversely affect our profitability or net operating revenues in the long run.

Fluctuations in quantity and quality of grape supply could adversely affect our business.

A shortage in the supply of quality grapes may result from a variety of factors that determine the quality and quantity of our grape supply, including weather conditions, pruning methods, diseases and pests, the ability to buy grapes on long and short term contracts and the number of vines producing grapes. Any shortage in grape production could cause a reduction in the amount of wine we are able to produce, which could reduce sales and adversely impact our results from operations. Factors that reduce the quantity of our grapes may also reduce their quality, which in turn could reduce the quality or amount of wine we produce. Deterioration in the quality of our wines could harm our brand name, reduce sales and adversely impact our business and results of operations.

Contamination of our wines could harm our business.

We are subject to certain hazards and product liability risks, such as potential contamination, through tampering or otherwise, of ingredients or products. Contamination of any of our wines could force us to destroy wine held in inventory and could cause the need for a product recall, which could significantly damage our reputation for product quality. We maintain insurance against certain of these kinds of risks, and others, under various insurance policies. However, the insurance may not be adequate or may not continue to be available at a price or on terms that are satisfactory to us and this insurance may not be adequate to cover any resulting liability.

Our business and operations would be adversely impacted in the event of a failure or interruption of our information technology infrastructure or as a result of a cybersecurity attack.

The proper functioning of our own information technology (IT) infrastructure is critical to the efficient operation and management of our business. We may not have the necessary financial resources to update and liquidity.maintain our IT infrastructure, and any failure or interruption of our IT system could adversely impact our operations. In addition, our IT is vulnerable to cyberattacks, computer viruses, worms and other malicious software programs, physical and electronic break-ins, sabotage and similar disruptions from unauthorized tampering with our computer systems. We believe that we have adopted appropriate measures to mitigate potential risks to our technology infrastructure and our operations from these IT-related and other potential disruptions. However, given the recent significant increases in industry audit volume, auditors’ interpretation and enforcement of documentation requirements and the increasing regulatory burdens associated with responding to those audits, it is likely that the negative pressures from legislative and regulatory changes will continue and accelerate.

For further information, see “Business—Government Regulation.”

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The comprehensive Healthcare Reform Law and other Federal and state legislative efforts will likely have a material adverse effect on our business, results of operations and financial condition.

Federal and state legislative and regulatory activities may materially affect reimbursement policies and rates for other items and services we provide and may otherwise affect our business results of operations and financial condition. For example, in March 2010, Congress enacted the Reform Package which includes comprehensive healthcare reform. Among many other provisions, the Reform Package expands the Medicaid program, mandates extensive insurance market reforms, creates new health insurance access points (e.g., insurance exchanges), provides certain insurance subsidies (e.g., premiums and cost sharing), imposes individual and employer health insurance requirements and makes a number of changes to the Code.

There are various provisions in the Reform Package that impact our business. For example, the Reform Package requires certain medical device manufacturers to pay an excise tax to the government, which may, in turn, increase our costs for these products. The Reform Package also provides for cuts in some Medicare payments made to certain providers and substantial cuts to Medicare Advantage plans, through which we contract to provide services to Medicare beneficiaries. Also included in the Reform Package are (i) an expansionunpredictability of the Recovery Audit Contractor Program, (ii) certain fraudtiming, nature and abuse prevention measures and (iii) expanded regulatory authority concerning the typesscope of conduct that can result in additional fines and penalties for those healthcare providers who do not comply with applicable laws and regulations.  Furthermore, the Reform Package grants the Secretary of Health and Human Services authority to set a date by which certain providers and suppliers will be required to establish a compliance program.

The Reform Package makes a number of changes to how certain of our products will be reimbursed by Medicare. As discussed above, the Reform Package made changes to the Medicare durable medical equipment CPI adjustment for 2011 and each subsequent year based upon the CPI-U reduced by a new multi-factor productivity adjustment which may result in negative updates. The law also includes changes to the Medicare DMEPOS competitive bidding program.

In an effort to further strengthen the integrity of the Medicare program, the Reform Package includes additional requirements concerning physician enrollment and certain mandatory face-to-face patient/physician visits in conjunction with the ordering of durable medical equipment. These provisions have been and will continue to be the subject of rulemaking and are a high priority for the American Association for Homecare and other industry representative organizations. We expect the Administration to continue to enhance its oversight efforts andany such IT failures or disruptions, we strive to incorporate any necessary changes into its overall policies, procedures, corporate compliance and internal audit programs on a regular basis.

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The effective dates of the various provisions within the Reform Package are staggered over several years. Much of the interpretation of what the Reform Package requires willcould potentially be subject to administrative rulemaking, the development of agency guidance and court interpretations. We cannot currently predict the full impact of the Reform Packagedowntimes, transactional errors, processing inefficiencies, operational delays, other detrimental impacts on our operations cash flowor ability to provide products to our customers, the compromising of confidential or personal information, destruction or corruption of data, security breaches, other manipulation or improper use of our systems and capital resources, but such impact could be material. In addition, other legislative and regulatory changesnetworks, financial losses from remedial actions, loss of business or potential liability, and/or damage to our reputation, any of which could have a material adverse effect on our business,cash flows, competitive position, financial condition or results of operations, cash flow, capital resourcesoperations.

If we fail to comply with personal data protection and liquidity.

Also, the number of the uninsured in the United States has had an impact on certain healthcare servicesprivacy laws, we could be subject to adverse publicity, government enforcement actions and/or private litigation, which could negatively affect our business and products that may be more discretionary in nature. This has resulted in a slowing down of certain growth rates due to the patients’ more limited ability to pay the associated out-of-pocket fees. This could continue as the number of uninsured persons remains high.

The continuing pressure to reduce healthcare costs could have a material adverse effect on us.operating results.

In the ordinary course of our business, we receive, process, transmit and store information relating to identifiable individuals ("personal data"), primarily employees, former employees and consumers with whom we interact. As a result, of continuing reductionswe are subject to various U.S. federal and state and foreign laws and regulations relating to personal data. These laws have been subject to frequent changes, and new legislation in payor reimbursement, we, likethis area may be enacted in other jurisdictions at any time. These laws impose operational requirements for companies receiving or processing personal data, and many other healthcare companies, are making substantial effortsprovide for significant penalties for noncompliance. These requirements with respect to reduce our costs in providing healthcare servicespersonal data have subjected and products. Many managed care organizations and insurers also regularly attempt to seek reductionsmay continue in the prices at whichfuture to subject the Company to, among other things, additional costs and expenses and have required and may in the future require costly changes to our business practices and information security systems, policies, procedures and practices. Our security controls over personal data, the training of employees and vendors on data privacy and data security, and the policies, procedures and practices we provide services to themimplemented or may implement in the future may not prevent the improper disclosure of personal data by us or the third-party service providers and their patients. Some managed care organizations and insurers also propose to limit coverage for our productsvendors whose technology, systems and services we use in connection with the receipt, storage and implement onerous payment rules, policies, administrative burdens, auditstransmission of personal data. Unauthorized access or improper disclosure of personal data in violation of personal data protection or privacy laws could harm our reputation, cause loss of consumer confidence, subject us to regulatory enforcement actions (including fines), and result in private litigation against us, which could result in loss of revenue, increased costs, liability for monetary damages, fines and/or criminal prosecution, all of which could negatively affect our business and operating results.

If our third-party service providers and business partners do not satisfactorily fulfill their commitments and responsibilities, our financial results could suffer.

In the conduct of our business, we rely on relationships with third parties, including cloud data storage and other requirements that adversely impactinformation technology service providers, suppliers, distributors, contractors, joint venture partners and other external business partners, for certain functions or for services in support of key portions of our reimbursementoperations. These third-party service providers and increase our costsbusiness partners are subject to similar risks as we are relating to cybersecurity, privacy violations, business interruption, and systems and employee failures, and are subject to legal, regulatory and market risks of providing servicestheir own. Our third-party service providers and products.business partners may not fulfill their respective commitments and responsibilities in a timely manner and in accordance with the agreed-upon terms. In addition, to this increasing pressure to reduce costs, the use by managed care payors of benefit managerswhile we have procedures in place for selecting and managing our relationships with third-party service providers and other intermediaries is also increasingbusiness partners, we do not have control over their business operations or governance and may adversely impact us, including for example by imposing of burdensome reimbursement policies we must comply withcompliance systems, practices and adverse changes inprocedures, which increases our participation status with managed care organizationsfinancial, legal, reputational and insurers.  We only have 3 contractual arrangements with managed care organizations and other parties, which represented approximately 5% of our total net revenues for each of the years ended December 31, 2011 and 2010, and we expect that we will continue to enter into more of these contractual arrangements.  Some of these contracts allow, usually after due notice, for payors to alter their payment policies (or newly enforced policies that were previously enacted). We could be materially adversely affected by adverse payment policy practices. Also, the Reform Package significantly reduces the government’s payment rates to Medicare Advantage plans. Other provisions impose minimum medical-loss ratios, state and federal premium review procedures and benefit requirements on insurers. These public policy changes have unpredictable effects on the insurance industry on which we rely. There can be no assurance that we will retain or obtain Medicare Advantage or other such managed care contracts or that such plans will not attempt to further reduce the rates they pay to providers. In addition, ifoperational risk. If we are unable to successfully reduceeffectively manage our costs,third-party relationships, or for any reason our third-party service providers or business partners fail to satisfactorily fulfill their commitments and responsibilities, our financial results could suffer.

Our results of operations may fluctuate from quarter to quarter for many reasons, including seasonality.

Our sales are seasonal and we mayexperience fluctuations in quarterly results as a result of many factors. Companies similar to ours have historically generated a greater percentage of our revenues during the warm weather months of April through September. Timing of customer purchases will vary each year and sales can be expected to shift from one quarter to another. As a result, management believes that period-to-period comparisons of results of operations are not necessarily meaningful and should not be relied upon as any indication of future performance or results expected for the fiscal year.

Changes in accounting standards and subjective assumptions, estimates and judgments by management related to complex accounting matters could significantly affect our financial results.

The U.S. GAAP and related pronouncements, implementation guidelines and interpretations with regard to a wide variety of matters that are relevant to our business, such as, but not limited to, stock-based compensation, trade spend and promotions, and income taxes are highly complex and involve many subjective assumptions, estimates and judgments by our management. Changes to these rules or their interpretation or changes in underlying assumptions, estimates or judgments by our management could significantly change our reported results.

If we are unable to continuemaintain effective disclosure controls and procedures and internal control over financial reporting, our stock price and investor confidence could be materially and adversely affected.

We are required to maintain both disclosure controls and procedures and internal control over financial reporting that are effective. Because of their inherent limitations, internal control over financial reporting, however well designed and operated, can only provide services directly to patientsreasonable, and not absolute, assurance that the controls will prevent or detect misstatements. Because of certain payorsthese and other inherent limitations of control systems, there is only the reasonable assurance that our controls will succeed in achieving their goals under all potential future conditions. The failure of controls by design deficiencies or through these contractual arrangements. This would haveabsence of adequate controls could result in a material adverse effect on our business and financial condition, results, which could also negatively impact our stock price and investor confidence.

Due to the size of operations, cash flow, capital resourcesthe Company, we havean inherent material weakness relating to Internal Controls over Financial Reporting.

We are dependent on a distiller in Mexico, to provide us with our finished SALT tequila product. Failure to obtain satisfactory performance from them or a loss of their services could cause us to lose sales, incur additional costs, and liquidity.lose credibility in the marketplace.

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Non-complianceWe depend on a distiller in Mexico, a company in Jalisco, for the production, bottling, labeling, capping and packaging of our finished tequila product. We do not have a written agreement with lawsour distiller in Mexico obligating it to produce our product. The termination of our relationship with our distiller in Mexico distiller or an adverse change in the terms of its services could have a negative impact on our business. If our distiller in Mexico increases its prices, we may not have alternative sources of supply at comparable prices and regulations applicablemay not be able to raise the prices of our products to cover all, or even a portion, of the increased costs. In addition, if our distiller in Mexico fails to perform satisfactorily, fails to handle increased orders, or we lose the services of our distiller in Mexico, along with delays in shipments of products, this could cause us to fail to meet orders, lose sales, incur additional costs, and/or expose us to product quality issues. In turn, this could cause us to lose credibility in the marketplace and damage our relationships with our customers and consumers, ultimately leading to a decline in our business and future changes in or interpretations of those laws and regulations could negatively affect our revenues and profitability.

We are subject to many stringent and frequently changing laws and regulations, and interpretations thereof, at both the federal and state levels, requiring compliance with burdensome and complex billing and payment, substantiation and record-keeping requirements. Examples of such documentation requirements are contained in the Durable Medical Equipment Medicare Administrative Contractor (“DME MAC”) supplier manuals which provide that clinical information from the “patient’s medical record” is required to justify the medical necessity for the provision of DME. Some DME MACs and other government auditors have recently taken the position, among other things, that the “patient’s medical record” refers not to documentation maintained by the DME supplier but instead to documentation maintained by the patient’s physician, healthcare facility, or other clinician, and that clinical information created by the DME supplier’s personnel and confirmed by the patient’s physician is not sufficient to establish medical necessity. It may be difficult, and sometimes impossible, for us to obtain such documentation from other healthcare providers. Also, auditors’ interpretations of these policies are inconsistent and subject to individual interpretations leading to high supplier and industry error rates. In fact, DME MACs have continued to conduct significant pre-payment reviews across the DME industry and have determined a wide range of error rates.  DME MACs have repeatedly cited medical necessity documentation insufficiencies as the primary reason for claim denials.  In addition, certain states including Ohiohave established unique documentation requirements concerning direct patient care activities provided by DME suppliers’ staff. In the absence of such documentation, the state may request a refund or impose sanctions such as fines. If these or other challenging positions continue to be adopted by auditors, DME MACs, states, CMS or its contractors in administering the Medicare program, we have the right to contest these positions as being contrary to law. Such appeal processes may be protracted and costly, even when the initial determinations are overturned. If these interpretations of the documentation requirements are ultimately upheld, it could result in our making significant refunds and other payments to Medicare and/or Medicaid and our future revenues from Medicare and/or Medicaid would likely be reduced. We cannot currently predict the adverse impact, if any, that these new, more onerous interpretations of the Medicare and/or Medicaid documentation requirements, or revised internal operational policies to address them, might have on our relationships with referral sources, operations, cash flow and capital resources, but such impact could be material.

The Federal False Claims Act imposes civil and criminal liability on individuals or entities that submit false or fraudulent claims for payment to the government. The federal government and a number of courts also have taken the position that claims presented in violation of certain other statutes, including the federal anti-kickback statute or the Omnibus Budget Reconciliation Act of 1993 (the “Stark Law”), can be considered a violation of the federal False Claims Act. Violations of the federal civil False Claims Act may result in treble damages, civil monetary penalties and exclusion from the Medicare, Medicaid and other federally funded healthcare programs. If certain criteria are satisfied, the federal civil False Claims Act allows a private individual to bring a qui tam suit on behalf of the government and, if the case is successful, to share in any recovery.  Federal False Claims Act suits brought directly by the government or private individuals against healthcare providers, like us, are increasingly common and are expected to continue to increase.

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The Reform Package also includes certain fraud and abuse prevention measures and expands regulatory authorities concerning the types of conduct that can result in additional fines and penalties for those healthcare providers who do not comply with applicable laws and regulations. The federal government also announced that it will apply real-time monitoring technologies to the Medicare claim management process, similar to technologies used in other industries. Although we cannot quantify at this time what, if any, impact such processes might have on our relationships with referral sources, operations, cash flow and capital resources, such impact could be material.

Financial relationships between us and physicians and other referral sources are also subject to strict limitations under laws such as the Stark Law and anti-kickback laws. In addition, strict licensure, accreditation, safety and marketing requirements apply to the provision of services, and medical equipment.

Violations of these laws and regulations could subject us to civil and criminal enforcement actions; licensure revocation, suspension or non-renewal; severe fines; facility shutdowns; repayment of amounts received from third party payors and possible exclusion from participation in federal healthcare programs such as Medicare and Medicaid. We cannot assure you that we are in compliance with all applicable existing laws and regulations or that we will be able to comply with any new laws or regulations that may be enacted in the future. In addition, from time to time, we may be the subject of investigations or audits or be a party to qui tam or other False Claims Act litigation which alleges violations of law. If any of those matters were successfully asserted against us, there could be a material adverse effect on our business, financial condition, results of operations, cash flow, capital resources, liquidity or prospects.

Changes in public policy, healthcare law, new interpretations of existing laws, or changes in payment methodology may have a material effect on our business, financial condition, results of operations, cash flow, capital resources and liquidity.

Expanded government auditing and oversight of Medicare and Medicaid suppliers and more stringent interpretations by those auditors of regulations and rules concerning billing for our services and products could have a material adverse effect on us.

Current law, including the recent Reform Package and an executive order signed by the President, provides for a significant expansion of the government’s auditing and oversight of suppliers who care for patients covered by various government healthcare programs. Examples of this expansion include audit programs being implemented by the DME MACs, the Zone Program Integrity Contractors (“ZPICs”), the Recovery Audit Contractors (“RACs”) and the Comprehensive Error Rate Testing contractors (“CERTs”) operating under the direction of CMS. We work cooperatively with these auditors and have long maintained a process for centrally tracking and managing our responses to their audit requests. However, unlike other government programs that are subject to a formal rulemaking process, there are only limited publicly-available guidelines and methodologies for determining errors or for providing clear and timely communications to DMEPOS suppliers in connection with these new types of audits. As a result, there is significant lack of clarity regarding the authority of the auditors, their expectations for document production requested during audits and the methodology for determining errors and calculating error rates.

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Along with other healthcare providers and suppliers, we have recently been subject to an increase in the number of audits conducted under these new programs.  Specifically, we have been subjected to 10 RAC audits during the fiscal year ended December 31, 2011 and 1 RAC audit during the six months ended June 30, 2012 and 3 prepayment audits during the 6 months ended June 30, 2012.  Seven of the 14 audits were okay and 7 resulted in the Company returning a total of $573 to Medicare, most of which was later rebilled and then paid by Medicare.  In some cases, the error rate appears to be based on the auditors’ incomplete or erroneous review of our submitted documentation, our inability to retrieve physician or hospital documentation from their records, the auditors’ enforcement of requirements for documentation for patients begun on service during a time period when lesser levels of documentation were accepted practice, or unclear scoring methodologies used by the auditors, among other factors. In other instances, high error rates have resulted from the auditors’ use of more stringent interpretations of the types of medical necessity documentation required for CMS to pay for the services we provide. We have appealed the results of certain of these audits and made changes to our operating policies and procedures, but cannot predict the ultimate impact that the government’s expanded and more stringent auditing, or our policies, may have on our business, financial conditions or results of operations.

We have been informed by these auditors that other healthcare providers

Regulatory decisions and all suppliers of certain DMEPOS product categories are expected to experience further increased scrutiny from these audit programs. When a government auditor ascribes a high error rate to us, it generally results in protracted pre-payment claims review, payment delays, refunds and other payments to the government and/or our need to request more documentation from referral sources than has historically been required.  Our error rate, aggregated with other DMEPOS supplierschanges in the industry,legal, regulatory and tax environment where our tequila is then reported to Medicare contractorsproduced and Congress.  We cannot currently predict the adverse impact, if any, that these new audits, methodologies and interpretations might have on our operations, cash flow and capital resources, but such adverse impactwhere we operate could be material.

See “Risks Relating to Our Business - Non-Compliance with Laws and Regulations applicable tolimit our business activities or increase our operating costs and future changesreduce our margins.

Our business is subject to extensive regulation regarding production, distribution, marketing, advertising and labeling of beverage alcohol products in or interpretations of these lawsthe U.S. and regulations could have a material adverse effect on us” for additional information.

Our failure to maintain required licenses could prevent us from serving Medicare patients or put us out of business.

in Mexico, where our tequila is produced. We are required to comply with these regulations and maintain several state and/or federal licenses for our operationsvarious permits and facility.licenses. We are licensed in Ohio by the Ohio Respiratory Care Boardalso required to conduct business only with holders of licenses to import, warehouse, transport, distribute, and we have a home medical equipment license from the State of Ohio.  State and federal licensing requirements are complex and often open to subjective interpretation by various regulatory agencies. Accurate licensure is also a critical threshold issue for the Medicare competitive bidding program. From time to time, we may also become subject to new or different licensing requirements due to legislative or regulatory requirements developments or changes in our business, and such developments may cause us to make further changes in our business, the results of which may be material. Although we believe we have appropriate systems in place to monitor licensure, violations of licensing requirements may occur and our failure to acquire or maintain appropriate licensure for our operations and facility could result in interruptions in our operations, refunds to state and/or federal payors, sanctions or fines or the inability to serve Medicare beneficiaries in competitive bidding markets which could have an adverse material impact on our business, financial condition, results of operation, cash flow, capital resources and liquidity.

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Our failure to maintain accreditation could put us out of business.

Accreditation is required by most of our managed care payors and became a mandatory requirement for all Medicare DMEPOS providers effective October 1, 2009. We completed our initial Accreditation with The Joint Commission on October 8, 2008 and we completed our triennial accreditation renewal on June 9, 2011 conducted by The Joint Commission, and the Commission renewed our accreditation for another three years. The Joint Commission accreditation encompasses our full complement of services including home health and home medical equipment.  We have more than 3 years of continuous accreditation by The Joint Commission.  If we lose accreditation, our failure to maintain accreditation could have a material adverse effect on our business, financial condition, results of operations, cash flow, capital resources and liquidity.

We experience significant competition from numerous other home medical equipment providers and other providers, and this competition could adversely affect our revenues and our business.

The home medical equipment market is highly competitive and includes a large number of providers, some of which are national providers, but most of which are either regional or local providers.  We believe that the primary competitive factors in our market are pricing and quality considerations such as reputation and responsiveness.    Most of our competitors may now or in the future have greater financial or marketing resources than we do and more effective sales and marketing activities.  Our primary national home medical equipment provider competitor is Apria Healthcare Group Inc.  The primary regional providers we compete with in Northeastern Ohio and Western Pennsylvania are Boardman Medical Supply, Inc., Community Home Medical, Inc., and Seeley Medical, Inc.  There are relatively few barriers to entry in our local home healthcare markets. Hospitals and health systems are routinely looking to provide coverage and better control of post-acute health care services, including homecare services of the types we provide. These trends may continue as new payment models evolve, including bundled payment models, shared savings programs, value based purchasing and other payment systems.  For example, the Reform Package introduced various new payment and delivery system models, including Accountable Care Organizations (ACOs). ACOs can share in savings, assuming certain quality metrics are met or exceeded. The shared savings feature in ACOs cause them to reduce the amount of services they refer to us. ACOs may be formed by a variety of providers and/or suppliers, including hospitals and health systems, as well as home medical equipment providers. Although participation in an ACO is voluntary, participation by our competitors in an ACO in certain markets may force us to participate as well or face a loss of business from ACO participants who are unwilling to refer to non-ACO participants. Even when we do participate, we may lose business if we do not meet the quality metrics that ACOs must earn to share in any savings they achieve. Moreover, commensurate with the formation of an ACO physicians and/or hospitals may decide to provide home healthcare services through a new developed capacity owned and/or controlled by themselves. Similar programs may be adopted by other governmental, state and commercial payors, and we cannot predict the impact, if any, of such new models on our business.sell spirits. We cannot assure you that these and other governmental regulations, applicable to our industry, changeswill not change or become more stringent. Moreover, because these laws and regulations are subject to interpretation, we may not be able to predict when, and to what extent, liability may arise. Additionally, due to increasing public concern over alcohol-related societal problems, including driving while intoxicated, underage drinking, alcoholism and health consequences from the competitive natureabuse of alcohol, various levels of government may seek to impose additional restrictions or limits on advertising or other marketing activities promoting beverage alcohol products. Failure to comply with any of the homecare environment willcurrent or future regulations and requirements relating to our industry and products, could result in monetary penalties, suspension or even revocation of our licenses and permits. Costs of compliance with changes in regulations could be significant and could harm our business, as we may find it necessary to raise our prices in order to maintain profit margins, which could lower the demand for our products and reduce our sales and profit potential.

In addition, the distribution of beverage alcohol products is subject to extensive taxation both in the United States and internationally (and, in the United States, at both the federal and state government levels), and beverage alcohol products themselves are the subject of national import and excise duties in most countries around the world. An increase in taxation or in import or excise duties could also significantly harm our sales revenue and margins, both through the reduction of overall consumption and by encouraging consumers to switch to lower-taxed categories of beverage alcohol.

We face substantial competition in the alcoholic beverage industry and we may not adverselybe able to effectively compete.

Consolidation among spirits producers, distributors, wholesalers, or retailers could create a more challenging competitive landscape for our products. Consolidation at any level could hinder the distribution and sale of our products as a result of reduced attention and resources allocated to our brands, both during and after transition periods, because our brands might represent a smaller portion of the new business portfolio.  Expansion into new product categories by other suppliers, or innovation by new entrants into the market, could increase competition in our product categories.  Changes to our route-to-consumer models or partners in important markets could result in temporary or longer-term sales disruption, higher implementation-related or fixed costs, and could negatively affect other business relationships we might have with that partner.  Distribution network disruption or fluctuations in our product inventory levels with distributors, wholesalers, or retailers could negatively affect our revenuesresults for a particular period.

Our competitors may respond to industry and economic conditions more rapidly or effectively than we do.  Our competitors offer products that compete directly with ours for shelf space, promotional displays, and consumer purchases.  Pricing, (including price promotions, discounting, couponing, and free goods), marketing, new product introductions, entry into our business.

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The fact that we are a relatively small company with limited resources compared to most ofdistribution networks, and other competitive behavior by our competitors could adversely affect our revenuessales margins, and our business.profitability.

MostOur business operations may be adversely affected by social, political and economic conditions affecting market risks and the demand for and pricing of our competitors have significantly greater resources, broader name recognition,tequila products.  These risks include:

Uncertainty in the financial markets and a larger installed base of clients than we have. As a result, these competitors may have greater credibility with our potential customers and referral sources.  They also may be able to adopt more aggressive pricing policies and devote greater resources to the development, promotion and sale of their products than we can to ours, which would allow them to respond more quickly than us toother adverse changes in general economic or political conditions in any of the major countries in which we do business could adversely affect our business.  

If we fail to cultivate new or maintain established relationships with hospitalindustry, business and physician referral sources, our revenues will likely decline.results of operations.

Global economic uncertainties, including foreign currency exchange rates, affect businesses such as ours in a number of ways, making it difficult to accurately forecast and plan our future business activities. There can be no assurance that economic improvements will occur, or that they would be sustainable, or that they would enhance conditions in markets relevant to us.

Our success is significantly dependent on referrals from hospital and physician sources, since much oflimited operating history makes it difficult to forecast our business comes from referrals. If we are unable to successfully establish new referral sources and maintain strong relationships with our current referral sources, our revenues will likely decline.future results, making any investment in us highly speculative.

Our lack of experience as a public company could cause you to lose your entire investment.

We have never operated as a public company.limited operating history, and our historical financial and operating information is of limited value in predicting our future operating results. We have no experience in complying with the various rulesmay not accurately forecast customer behavior and regulations whichrecognize or respond to emerging trends, changing preferences or competitive factors facing us, and, therefore, we may fail to make accurate financial forecasts. Our current and future expense levels are requiredbased largely on our investment plans and estimates of a public company.future revenue. As a result, we may not be ableunable to operate successfullyadjust our spending in a timely manner to compensate for any unexpected revenue shortfall, which could then force us to curtail or cease our business operations.

Risks Related to our Securities

An investment in our common stock is speculative and there can be no assurance of any return on any such investment.

An investment in our common stock is speculative and there is no assurance that investors will obtain any return on their investment. Investors will be subject to substantial risks involved in an investment in the Company, including the risk of losing their entire investment.

Future sales of common stock, or the perception of such future sales, by some of our existing stockholders could cause our stock price to decline.

The market price of our common stock could decline as a result of sales of a large number of shares of our common stock in the market or the perception that these sales may occur. These sales, or the possibility that these sales may occur, also might make it more difficult for us to sell shares in the future at a time and at a price that we deem appropriate.

From time to time, certain of our stockholders may be eligible to sell all or some of their common shares by means of ordinary brokerage transactions in the open market pursuant to Rule 144 promulgated under the Securities Act of 1933, as amended (the “Securities Act”), subject to certain limitations. In general, pursuant to Rule 144, non-affiliate stockholders may sell freely after six months subject only to the current public company, even if our operations are successful. We planinformation requirement. Affiliates may sell after six months subject to comply with allthe Rule 144 volume, manner of sale (for equity securities), and current public information and notice requirements. 

There is currently a limited liquid trading market for the Company’s Common Stock.

Prior to the commencement of the various rulesoffering, our common stock was quoted on the OTCQB under the symbol “SBEV” and regulationsthere was no market for our warrants. Trading in stocks quoted on the OTCQB is often thin and is characterized by wide fluctuations in trading prices due to many factors that may be unrelated to a company’s operations or business prospects, or may be affected by variations in our quarterly operating results, announcements that our revenue or income is below analysts’ expectations, general economic downturns, sales of large blocks of our common stock or announcements by us or our competitors of significant contracts, acquisitions, strategic partnerships, joint ventures or capital commitments. Although we will only consummate this offering if the NYSE American approves the listing of our common stock and warrants, there is no assurance that there will be a consistent, active market in the future for our common stock. The lack of an active market may impair your ability to sell your shares at the time you wish to sell them or at a price that you consider reasonable. 

Our Board of Directors may issue and fix the terms of shares of our Preferred Stock without stockholder approval, which are requiredcould adversely affect the voting power of a public company. However, if we cannot operate successfullyholders of our Common Stock or any change in control of our Company.

Our Articles of Incorporation authorize the issuance of up to 5,000,000 shares of “blank check” preferred stock, with no par value per share, with such designation rights and preferences as may be determined from time to time by the Board of Directors. Our Board of Directors is empowered, without shareholder approval, to issue shares of preferred stock with dividend, liquidation, conversion, voting or other rights which could adversely affect the voting power or other rights of the holders of our common stock. In the event of such issuances, the preferred stock could be used, under certain circumstances, as a public company, your investment may be materially adversely affected. Our inability to operate as a public company could be the basismethod of your losing your entire investment in us.

Since our founder is our only full-time officer, if something happened to him such that he was unavailable to run our business, we could possibly have to suspend our businessdiscouraging, delaying or cease operations.

Our success will be dependent upon the decision making of our directors and executive officers. Michael West, our CEO devotes his full time to our business, but Steve West devotes only a small percentage of his time to the business. The loss of Michael West would have a material, adverse impact on our operations. We have no written employment agreements with any officers and directors. We have not obtained key man life insurance on the lives of any of these individuals.

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Our directors have the ability to significantly influence any matters to be decided by the stockholders, which may prevent or delaypreventing a change in control of our company.company.

Michael J. West, our President, CEO and director owns 8,300,000 sharesBecause certain principal stockholders own a large percentage of our voting stock, (87.4%other stockholders’ voting power may be limited.

As of the shares outstanding) and Stephen H. West, March 31, 2021 our CFO, Secretary and director, owns 300,000 sharesten (10) largest shareholders own or controlled approximately 54% of our stock (3.2% of the shares outstanding).  Therefore, the current members of our Board of Directors beneficially own, in the aggregate, approximately 90.5% of ouroutstanding common stock. AsIf those stockholders act together, they would have the ability to have a result, if they choose to vote in concert, our directors are collectively able to significantlysubstantial influence the outcome of any corporateon matters submitted to our stockholders for approval, including the election and removal of directors and the approval of any transaction that might causemerger, consolidation or sale of all or substantially all of our assets. As a change in control,result, our other stockholders may have little or no influence over matters submitted for shareholder approval. In addition, the ownership of such as a merger or acquisition. It is unlikely that stockholders in favorcould preclude any unsolicited acquisition of a matter, which is opposed byus, and consequently, adversely affect the Boardprice of Directors, would be able to obtain the number of votes necessary to overrule the vote of the Board of Directors. Further, the control by the directors means that theyour common stock. These stockholders may make decisions for us with whichthat are adverse to your interests.

We do not expect to pay dividends and investors should not buy our Common Stock expecting to receive dividends.

We do not anticipate that we will declare or pay any dividends in the foreseeable future. Consequently, you may disagree or that you may feel are notwill only realize an economic gain on your investment in our best interests.

RISK FACTORS RELATED TO THE JOBS ACT:

The recently enacted JOBS Act will allow us to postpone the date by which we must comply with certain laws and regulations and to reduce the amount of information provided in reports filed with the SEC. We cannot be certain if the reduced disclosure requirements applicable to “emerging growth companies” will make our common stock less attractive to investors.

We are and we will remain an "emerging growth company" untilif the earliest to occur of (i) the last day of the fiscal year during which our total annual revenues equal or exceed $1 billion (subject to adjustment for inflation), (ii) the last day of the fiscal year following the fifth anniversary of our initial public offering, (iii) the date on which we have, during the previous three-year period, issued more than $1 billion in non-convertible debt securities, or (iv) the date on which we are deemed a "large accelerated filer" (with at least $700 million in public float) under the Exchange Act. For so long as we remain an "emerging growth company" as defined in the JOBS Act, we may take advantage of certain exemptions from various reporting requirements that are applicable to other public companies that areprice appreciates. You should not "emerging growth companies" as described in further detail in the risk factors below. We cannot predict if investors will findpurchase our common stock less attractive becauseexpecting to receive cash dividends. Since we will rely on some or all of these exemptions. If some investors find our common stock less attractive as a result, there may be a less activedo not pay dividends, and if we are not successful in establishing an orderly trading market for our shares, then you may not have any manner to liquidate or receive any payment on your investment. Therefore, our failure to pay dividends may cause you to not see any return on your investment even if we are successful in our business operations. In addition, because we do not pay dividends we may have trouble raising additional funds which could affect our ability to expand our business operations.

There can be no assurances that our common stock once listed on the NYSE American stock exchange will not be subject to potential delisting if we do not continue to maintain the listing requirements of the NYSE American.

We have applied to list the shares of our common stock and warrants on the NYSE American stock exchange, or the NYSE American, under the symbols “SBEV” and “SBEV WS”, respectively. An approval of our listing application by the NYSE American will be subject to, among other things, our fulfilling all of the listing requirements of the NYSE American. In addition, the NYSE American has rules for continued listing, including, without limitation, minimum market capitalization and other requirements. Failure to maintain our listing (i.e., being de-listed from the NYSE American), would make it more difficult for shareholders to sell our common stock and more difficult to obtain accurate price quotations on our common stock. This could have an adverse effect on the price of our common stock. Our ability to issue additional securities for financing or other purposes, or otherwise to arrange for any financing we may need in the future, may also be materially and adversely affected if our common stock is not traded on a national securities exchange.

Speculative Nature of Warrants.

The warrants offered in this offering do not confer any rights of common stock ownership on their holders, such as voting rights or the right to receive dividends, but rather merely represent the right to acquire shares of our common stock at a fixed price for a limited period of time. Specifically, commencing on the date of issuance, holders of the warrants may exercise their right to acquire the common stock and pay an exercise price of $6.87 per share (115% of the assumed public offering price of our common stock and warrants in this offering), prior to five years from the date of issuance, after which date any unexercised warrants will expire and have no further value. Moreover, following this offering, the market value of the warrants is uncertain and there can be no assurance that the market value of the warrants will equal or exceed their public offering price. There can be no assurance that the market price of the common stock will ever equal or exceed the exercise price of the warrants, and consequently, whether it will ever be profitable for holders of the warrants to exercise the warrants.

Our common stock may be more volatile. If we avail ourselves of certain exemptions from various reporting requirements, as is currently our plan, our reduced disclosureconsidered a “penny stock”, and thereby be subject to additional sale and trading regulations that may make it more difficult for investors and securities analysts to evaluate us and may result in less investor confidence.

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Our election not to opt out of the JOBS Act extended accounting transition period may not make our financial statements easily comparable to other companies.sell.

PursuantOur common stock may be considered to the JOBS Act, as an “emerging growth company,” we can elect to opt outbe a “penny stock” if it does not qualify for one of the extended transition period for any new or revised accounting standards thatexemptions from the definition of “penny stock” under Section 3a51-1 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Our common stock may be a “penny stock” if it meets one or more of the following conditions: (i) the stock trades at a price less than $5.00 per share; (ii) it is not traded on a “recognized” national exchange; or (iii) is issued by the Public Company Accounting Oversight Board (PCAOB) or the SEC. We have elected not to opt out of such extended transition period, which meansa company that when a standard is issued or revised and it has different application dates for public or private companies, our company, as an “emerging growth company”, can adopt the standard for the private company.  This may make comparison of our financial statementsbeen in business less than three years with any other public company which is not an “emerging growth company” difficult or impossible since possible different or revised standards may be used.net tangible assets less than $5 million.

The recently enacted JOBS Act will also allow our company to postponeOur common stock could be further diluted as the date by which it must comply with certain laws and regulations intended to protect investors and to reduceresult of the amountissuance of information provided in reports filed with the SEC.additional common stock, convertible securities, warrants or options.

The recently enacted JOBS Act is intended to reduceOur issuance of additional common stock, convertible securities, options and warrants could affect the regulatory burden on “emerging growth companies”.  So long as we qualify as an “emerging growth company,” we will, among other things:

•

be exempt from the provisions of Section 404(b) of the Sarbanes-Oxley Act requiring that our independent registered public accounting firm provide an attestation report on the effectivenessrights of our internal control over financial reporting;

•

be exempt fromstockholders, result in a reduction in the "say on pay” provisions (requiring a non-binding shareholder vote to approve compensation of certain executive officers) and the "say on golden parachute” provisions (requiring a non-binding shareholder vote to approve golden parachute arrangements for certain executive officers in connection with mergers and certain other business combinations) of The Dodd–Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) and certain disclosure requirements of the Dodd-Frank Act relating to compensation of Chief Executive Officers;

•

be permitted to omit the detailed compensation discussion and analysis from proxy statements and reports filed under the Exchange Act, as amended and instead provide a reduced level of disclosure concerning executive compensation; and

•

be exempt from any rules that may be adopted by the PCAOB requiring mandatory audit firm rotation or a supplement to the auditor’s report on the financial statements.

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Although we are still evaluating the JOBS Act, we currently intend to take advantage of all of the reduced regulatory and reporting requirements that will be available to us so long as we qualify as an “emerging growth company”.  We have elected not to opt out of the extension of time to comply with new or revised financial accounting standards available under Section 107(b)(1) of the JOBS Act.  Among other things, this means that our independent registered public accounting firm will not be required to provide an attestation report on the effectivenessoverall percentage holdings of our internal control over financial reporting so long as we qualify as an “emerging growth company”, which may increase the risk that weaknesses or deficiencies in the internal control over financial reporting go undetected.  Likewise, so long as we qualify as an “emerging growth company”, we may elect not to provide certain information, including certain financial information and certain information regarding compensation of executive officers, which would otherwise have been required to provide in filings with the SEC, which may make it more difficult for investors and securities analysts to evaluate us. As a result, investor confidence in our company andstockholders, could put downward pressure on the market price of our common stock, may be adversely affected.

Notwithstanding the above, we are also currently a “smaller reporting company”, meaning that we have a public floatcould result in adjustments to conversion and exercise prices of less than $75 millionoutstanding notes and annual revenues of less than $50 million during the most recently completed fiscal year.  In the event that we are still considered a “smaller reporting company”, at such time as we cease being an “emerging growth company”, the disclosure we will be requiredwarrants, and could obligate us to provide in our SEC filings will increase, but will still be less than it would be if we were not considered either an “emerging growth company” or a “smaller reporting company”.  Specifically, similar to “emerging growth companies”, “smaller reporting companies” are able to provide simplified executive compensation disclosures in their filings; are exempt from the provisions of Section 404(b) of the Sarbanes-Oxley Act requiring that independent registered public accounting firms provide an attestation report on the effectiveness of internal control over financial reporting; are not required to conduct say-on-pay and frequency votes until annual meetings occurring on or after January 21, 2013; and have certain other decreased disclosure obligations in our SEC filings, including, among other things, only being required to provide two years of audited financial statements in annual reports.  Decreased disclosures in our SEC filings due to our status as an “emerging growth company” or “smaller reporting company” may make it harder for investors to analyze the Company’s results of operations and financial prospects.

RISKS ASSOCIATED WITH THIS OFFERING:

Buying low-priced Penny Stocks is very risky and speculative and since our shares will be a Penny Stock, it will be more difficult for investors to sell their shares.

The shares being offered are defined as a penny stock under the Securities and Exchange Act of 1934, and rules of the Commission. The Exchange Act and such penny stock rules generally imposeissue additional sales practice and disclosure requirements on broker-dealers who sell our securities to persons other than certain accredited investors who are, generally, institutions with assets in excess of $5,000,000 or individuals with net worth in excess of $1,000,000 or annual income exceeding $200,000, or $300,000 jointly with spouse, or in transactions not recommended by the broker-dealer. For transactions covered by the penny stock rules, a broker-dealer must make a suitability determination for each purchaser and receive the purchaser’s written agreement prior to the sale. In addition, the broker-dealer must make certain mandated disclosures in penny stock transactions, including the actual sale or purchase price and actual bid and offer quotations, the compensation to be received by the broker-dealer and certain associated persons, and deliver certain disclosures required by the Commission. Consequently, the penny stock rules may affect the ability of broker-dealers to make a market in or trade our common stock andto certain of our stockholders.

Common stock eligible for future sale may alsoadversely affect your ability to resell any shares you may purchase in this offering in the public markets.

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We are selling this Offering without an underwriter and if we are unable to sell a sufficient number of shares we will be forced to reduce our proposed business operations if we can’t raise other financing.

This offering is self-underwritten, that is, we are not going to engage the services of an underwriter to sell the shares; we intend to sell them through our officers and directors, who will receive no commissions. We will hold investment meetings and invite our friends, acquaintances and relatives in an effort to sell the shares to them; however, there is no guarantee that we will be able to sell any of the shares. In the event we are unable to sell most of the shares in this offering, we will be forced to reduce our proposed business operations until such time as additional monies can be obtained, either through loans or financings.

You will incur immediate and substantial dilution of the price you pay for your shares.  

Our existing stockholders acquired their shares at a cost substantially less than that which you will pay for the shares you purchase in this offering. Accordingly, any investment you make in these shares will result in the immediate and substantial dilution of the net tangible book value of those shares from the $0.25 you pay for them.  As of September 30, 2012, our net tangible book value was a negative $81,099 or approximately ($0.009) per share.  Assuming that $267,500 of maximum net proceeds are realized from this Offering, the dilution to new investors from the Offering price of $0.25 per share will be approximately $0.233 per share, and the gain by existing investors will be approximately $0.026 per share.  Assuming that $7,500 of minimum net proceeds are realized from this Offering, the dilution to new investors from the Offering price of $0.25 per share will be approximately $0.258 per share, and the gain by existing investors will be approximately $0.001 per share.

Our common stock currently has no trading market and if a trading market does not develop, investors will have difficulty selling their shares.

There is presently no demand for our common stock. There is presently no public market for the shares being offered in this prospectus. While we do intend to apply for quotation on the Over-the-Counter Bulletin Board, we cannot guarantee that our application will be approved and our stock listed and quoted for sale. If no market is ever developed for our common stock, it will be difficult for you to sell any shares you purchase in this offering. In such a case, you may find that you are unable to achieve any benefit from your investment or liquidate your shares without considerable delay, if at all. In addition, if we fail to have our common stock quoted on a public trading market, your common stock will not have a quantifiable value and it may be difficult, if not impossible, to ever resell your shares, resulting in an inability to realize any value from your investment.

The Over-the-Counter market for stock such as ours has had extreme price and volume fluctuations.

The securities of companies such as ours have historically experienced extreme price and volume fluctuations during certain periods. These broad market fluctuations and other factors, such as new product developments and trends in the our industry and in the investment markets generally, as well as economic conditions and quarterly variations in our operational results, may have a negative effect on the market price of our outstanding shares of common stock.

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AllFrom time to time, certain of our stockholders may be eligible to sell all or some of their shares of common stock is restricted but could become eligible for resaleby means of ordinary brokerage transactions in the open market pursuant to Rule 144 promulgated under the Securities Act, subject to certain limitations. In general, pursuant to Rule 144;144, non-affiliate stockholders may sell freely after six months subject only to the current public information requirement. Affiliates may sell after six months subject to the Rule 144 volume, manner of sale (for equity securities), and current public information and notice requirements.

You should consult your independent tax advisor regarding any tax matters arising with respect to any investment in our securities.

All prospective purchasers of our securities are advised to consult their own tax advisors regarding the U.S. federal, state, local and non-U.S. tax consequences relevant to the purchase, ownership and disposition of our securities.

USE OF PROCEEDS

We expect to receive net proceeds from this could causepublic offering of approximately $13,372,500 or approximately $15,442,500 if the marketunderwriters exercise their option to purchase additional shares and accompanying warrants in full (assuming an initial public offering price of $5.97 per share, which was the last reported sale price of our common stock to drop significantly, even if our business is doing well.

Of our total outstanding shares following this offering, 9,500,000 or 98.3% (minimum) or 88.8% (maximum) are restricted from immediate resale but may be sold into the market subject to volume and manner of sale limitations under Rule 144 beginning in ________, 2013 (90 days after date of this prospectus). This could cause the market price of our common stock to drop significantly, even if our business is doing well. After this offering, we will have outstanding 10,700,000 shares (maximum) or 9,660,000 (minimum) of common stock based on the numberOTCQB on May 19, 2021 as adjusted for the one-for-three reverse stock split), after deducting the underwriting discounts and commissions and estimated offering expenses payable by us. If all of shares outstanding at April 30, 2012. This includes the common shares we are sellingwarrants sold in this offering which maywere to be resoldexercised in the public market immediately.

As restrictions on resale end, the marketcash at an assumed exercise price of our stock could drop significantly$6.87 per share, we would receive additional net proceeds of approximately $17,261,307. We cannot predict when, or if, the holdersthese warrants will be exercised. It is possible that these warrants may expire and may never be exercised.

 We intend to use net proceeds from this offering for working capital and general corporate purposes, including potential acquisitions, operating expenses and repayment of restricted shares sell them or are perceived by the market as intending to sell them.

We do not expect to pay dividends on common stock.

We have not paid any cash dividends with respect to our common stock, and it is unlikely that we will pay any dividends on our common stock in the foreseeable future. Earnings, if any, thatdebt. Additionally, we may realize will be retained in the business for further development and expansion.

USE OF PROCEEDS

We will not receive any proceeds from the sale of anyuse a portion of the 1,500,000 shares of common stock being registered in this prospectus and which are currently held by our selling shareholders.

We have estimated the totalnet proceeds from this offering to be $40,000, assuming a minimum offering,in-license, acquire or $300,000, assuming all shares are sold, whichinvest in complementary businesses, technologies, products or assets. However, we cannot guarantee. These proceedshave no current plans, commitments or obligations to do so. Other than as set forth, we do not include offering costs, which we estimateanticipate requiring any material amounts of other funds to be $32,500. accomplish the specified purposes.

We expect to disbursebelieve that the net proceeds from this offering inand our existing cash will be sufficient to fund our operations through at least the prioritynext 24 months. This expected use of the net proceeds from the offering represents our intentions based upon our current plans and business conditions. We cannot specify with certainty all of the particular uses of the net proceeds that we will receive from this offering, or the amounts that we will actually spend on the uses set forth below, during the first 12 months after successful completion of this offering: