Company: LIFD
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001096906-25-001862
Chunk: 124

Company: LFTD PARTNERS INC.
Filing Date: 2025-11-14
Form: 10-Q
Item: Item 1
Chunk 124
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 coverage, the CSO receives (1) a royalty on certain gummies manufactured by Lifted of between $0.005 and $0.01, and (2) certain quarterly and annual bonuses based upon Lifted’s quarterly and annual collected revenues on certain sales exceeding targets of $9,000,000 and $58,000,000, respectively.

Lifted’s former Chief Strategy Officer (the “CSO”), who worked for Lifted from July 1, 2021 through April 30, 2024, had been hired to develop and implement certain important strategies to assist Lifted’s efforts to increase its production, fulfillment and sales capabilities. The CSO’s two-year agreement with Lifted entitled the CSO to be paid an annual salary of $180,000 plus a bonus equal to 5% of total net sales for Lifted in excess of $6,000,000 per quarter. The CSO’s final bonus, for April 2024, was $27,941. For the three and nine months ended September 30, 2024, the bonus earned by the CSO was $0 and $191,273, respectively.

Advertising and Marketing Expenses

Advertising and marketing costs are expensed as incurred. During the three and nine months ended September 30, 2025, the Company incurred $426,573 and $1,374,018, respectively, in advertising and marketing expenses. Advertising and marketing expenses primarily relate to marketing campaigns, trade shows, digital marketing, and promotional products. Lifted has been engaging with third party specialists to increase its presence in the direct-to-consumer space.  In comparison, during the three and nine months ended September 30, 2024, the Company incurred $470,676 and $837,462, respectively, in advertising and marketing expenses.

Bad Debt Expense

Bad debt expense for the three and nine months ended September 30, 2025 totaled $418,918 and $664,686, respectively. In comparison, bad debt expense for the three and nine months ended September 30, 2024, totaled $864,345 and $2,304,898, respectively. 

Bad debt expense stems from the change in the Company’s allowance for doubtful accounts, which stems from the Company’s CECL Model analysis. The delay in Lifted’s receipt of payments from certain customers—primarily distributors—have increasingly become an issue for Lifted. Certain customers have become slower to pay Lifted for purchased product (“Slow