Based on the provided financial report articles, I generated the title for the article: "Quarterly Report (Q3) for the period ended September 30, 2024, and related information for the years ended December 31, 2023, and 2022" Please note that the title may not be exact, as the provided text is a financial report and may not contain a specific title.

Forward Looking Statements

This Quarterly Report on Form 10-Q includes both historical and “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended. The company has based these forward-looking statements on its current expectations and projections about future results. The company cautions that its opinions and expectations reflected in the forward-looking statements may not be realized, and actual results may differ substantially from the views and expectations set forth in this report. The company disclaims any intent or obligation to update any forward-looking statements after the date of this report to conform such statements to actual results or to changes in its opinions or expectations.

Overview

The company produces film products for novelty, packaging and container applications, including foil balloons, latex balloons, films for packaging and custom product applications, and flexible containers. The company produces all of its film products and most of its foil balloons at its plant in Lake Barrington, Illinois. The company previously produced latex balloons at a majority-owned facility in Mexico, but this facility was sold in October 2021. The company now purchases latex balloons from an unrelated vendor and distributes them in the United States. During 2023, the company changed its name to include “Green” to communicate its intention to supply biodegradable and compostable materials developed by its partners in Asia.

September 30, 2021 Financing, Amended and Extended to September 30, 2025

In September 2021, the company entered into a loan and security agreement with Line Financial, which provided for a senior secured financing consisting of a $6 million revolving credit facility and a $731,250 term loan facility. This agreement and the senior facilities were extended on similar terms during September 2023 with a termination date of September 30, 2025.

The key terms of the amended senior facilities include:

• Replacement of the asset monitoring fee on the revolving credit facility with an increase in interest rate to Prime plus 7.82% per annum
• Reduction of the interest rate on the term loan to Prime plus 1.45% per annum, with a one-time additional advance of $206,000 to reset the term loan to $731,000
• Reduction of the renewal fee to $50,000
• Setting the term loan asset monitoring fee to 0.385% per month

The senior facilities require the company to maintain a minimum tangible net worth of $4,000,000, which the company believes it was in compliance with as of September 30, 2024 and December 31, 2023.

Note Payable, Related Party

The company has a note payable to its director and former chairman, John H. Schwan, with a loan balance of $1.3 million and an interest rate of 6% as of December 31, 2023. The company repaid $1 million to Mr. Schwan during January 2024 and agreed to pay the remaining $0.3 million at a future date.

Results of Operations

Net Sales:

• For the three months ended September 30, 2024, net sales were $2,540,000, compared to $1,923,000 in the same period of 2023, an increase of 32%.
• For the nine months ended September 30, 2024, net sales were $11,788,000, compared to $11,033,000 in the same period of 2023, an increase of 7%.
• The increase in sales was primarily driven by higher sales of foil balloons, which make up 91% and 72% of net sales for the three and nine month periods, respectively.

Cost of Sales:

• During the three and nine month periods ended September 30, 2024, the cost of sales was $2,560,000 and $10,220,000, respectively, compared to $1,903,000 and $9,372,000 in the same periods of 2023.
• As a percentage of sales, cost of sales was 101% and 87% during the three and nine months ended September 30, 2024, compared to 99% and 85% during the same periods in 2023.
• The increase in cost of sales as a percentage of sales was primarily due to a $40,000 inventory loss from a fire sprinkler failure and lower manufacturing cost capitalization into inventory due to later fourth quarter 2024 shipments.

General and Administrative Expenses:

• During the three and nine month periods ended September 30, 2024, general and administrative expenses were $751,000 and $2,449,000, respectively, compared to $677,000 and $2,294,000 in the same periods of 2023.
• The increase was primarily due to $170,000 in higher audit expenses related to the former auditor being suspended from practicing before the SEC.

Selling, Advertising and Marketing Expenses:

• During the three and nine month periods ended September 30, 2024, these expenses were $220,000 and $633,000, respectively, compared to $172,000 and $474,000 in the same periods of 2023.
• The increase was primarily due to $45,000 in additional sales commissions and higher payroll costs for new product design.

Other Income (Expense):

• During the three and nine month periods ended September 30, 2024, the company incurred $201,000 and $655,000 in interest expense, respectively, compared to $124,000 and $421,000 in the same periods of 2023.
• The increase in interest expense was due to higher market interest rates.
• The company recognized $895,000 in income during the nine months ended September 30, 2023 related to Employee Retention Tax Credits.

Financial Condition, Liquidity and Capital Resources

Cash Flow:

• During the nine months ended September 30, 2024, the company generated $862,000 in net cash from operations, compared to using $442,000 in the same period of 2023.
• The company used $302,000 in investing activities and $1,476,000 in financing activities during the nine months ended September 30, 2024.

Liquidity and Capital Resources:

• At September 30, 2024, the company had $5,000 in cash, compared to $64,000 at September 30, 2023.
• The company’s ability to continue as a going concern is dependent on executing its business plan and obtaining adequate capital. Management’s plans include focusing on the most profitable elements and exploring alternative funding sources.
• There is substantial doubt about the company’s ability to continue as a going concern for one year from the issuance of the financial statements.

Seasonality:

• The foil balloon product line has historically been seasonal, with approximately 40% of sales occurring from December through March and 24% from July through October.

Critical Accounting Estimates:

• There have been no material changes to the company’s critical accounting estimates since December 31, 2023.

Changes in and Disagreements with Accountants:

• In April 2024, the company changed its independent auditor from BF Borgers, CPA PC to Wolf & Company, P.C. after BF Borgers was suspended from practicing before the SEC.
• This change required the new auditor to perform additional procedures related to 2023 balances, delaying the company’s ability to issue required filings during 2024 until September 2024.