Company: LIFD
Filing Date: 2025-03-31
Form Type: 10-K
Source: 0001096906-25-000346
Chunk: 889

Company: LFTD PARTNERS INC.
Filing Date: 2025-03-31
Form: 10-K
Item: Item 14
Chunk 889
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 was recognized.  The Valuation Firm’s report also indicated that, for tax reporting purposes, discounts ranging from 23% to 31% for lack of marketability and blockage should be used when valuing the 410,000 shares of Deferred Contingent Stock that were issued during the first quarter of 2023. In the Finnerty Protective Put model for each unique block of issued stock, the Valuation Firm has assumed a minimum term of six months, equal to the minimum time to sell the subject shares due to their restricted nature; and a maximum term equal to the amount of time it would take for the market to absorb the additional shares based upon an assumed additional volume of 7.5%. The Valuation Firm also assumed that no dividends on common stock will be paid, and that the expected volatility is based on the historical volatility of the trading of LIFD’s common stock.  On September 21, 2023, 93,000 shares of Deferred Contingent Stock were issued. A different valuation firm (“Second Valuation Firm”) was engaged to estimate the discount for lack of marketability and blockage applicable to the fair market value of these 93,000 shares of Deferred Contingent Stock for tax reporting purposes. The Second Valuation Firm used the Finnerty Protective Put Model to determine the discount rate to apply to the Deferred Contingent Stock in order to value it for tax reporting purposes. In the Finnerty Protective Put model, the Second Valuation Firm has assumed a minimum term of six months, equal to the minimum time to sell the subject shares due to their restricted nature; and a maximum term equal to the amount of time it would take for the market to absorb the additional shares based upon an assumed additional volume of 20% and 7.5%. The Second Valuation Firm also assumed that no dividends on common stock will be paid, expected volatility based on observed volatility of the trading of LIFD’s common stock, and risk-free rate based on the yield on U.S. Treasury bonds. The Second Valuation Firm’s report indicated that, for tax reporting purposes, a 27% discount should be used when valuing the 93,000 shares of Deferred Contingent Stock that were issued on September 21, 2023. 

F-25Table of Contents

 Through December 31, 2024, 503,000 shares of Deferred Contingent Stock have been issued to certain Deferred Contingent Stock Recipients.  The following