Company: LIFD
Filing Date: 2025-08-14
Form Type: 10-Q
Source: 0001096906-25-001332
Chunk: 45

Company: LFTD PARTNERS INC.
Filing Date: 2025-08-14
Form: 10-Q
Item: Part I, Item 8
Chunk 45
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 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 six months ended June 30, 2024, the bonus earned by the CSO was $27,941 and $191,273, respectively. 

Advertising and Marketing Expenses

Advertising and marketing costs are expensed as incurred. During the three and six months ended June 30, 2025, the Company incurred $531,873 and $947,445, 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 six months ended June 30, 2024, the Company incurred $190,126 and $366,786, respectively, in advertising and marketing expenses.

Bad Debt Expense

Bad debt expense for the three and six months ended June 30, 2025, totaled $649,637 and $245,768, respectively; bad debt expense for the six months ended June 30, 2025 is less than bad debt expense for the three months ended June 30, 2025 because the Company reported a benefit from bad debt expense of $403,869 during the quarter ended March 31, 2025. Bad debt expense for the three and six months ended June 30, 2024, totaled $1,165,275 and $1,440,553, respectively.

 9Table of Contents

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 Paying Customers”), and the Slow Paying Customers disregard payment terms. Management speculates that some Slow Paying Customers may be slow-paying Lifted because of their own sales