DISRUPTIVE BEVERAGE INC

nce of stock options to purchase up to an aggregate of 3,600,000 shares of common stock. Options may be granted for such consideration as determined by the Board of Directors. The vesting schedule and exercise price of these options are tied to the recipient’s ownership level of common stock, the terms generally allow for the reduction in exercise price upon each vesting period and the options generally expire after ten years. The Board of Directors has also authorized the issuance of options to purchase up to 100,000 shares of common stock to be issued at the direction of the Chairman. The Key Employee Equity Partnership Program (“KEEP Program”) provides for the granting of stock options to purchase up to 480,000 shares of common stock to key employees, consultants, directors and officers

gross profit per case increased and gross margin remained constant at 37.0% for both Fiscal 2026 and Fiscal 2025. Shipping and handling costs are included in selling, general and administrative expenses, the classification of which is consistent with many beverage companies. However, our gross margin may not be comparable to companies that include shipping and handling costs in cost of sales. See Note 1-Significant Accounting Policies, of Notes to the Consolidated Financial Statements. Selling, General and Administrative Expenses Selling, general and administrative expenses for Fiscal 2026 decreased $1.3 million to $207.2 million from $208.5 million for Fiscal 2025. The decrease was primarily due to a decrease in administrative and shipping and handling costs, partially offset by an incre