Company: LIFD
Filing Date: 2025-08-14
Form Type: 10-Q
Source: 0001096906-25-001332
Chunk: 73

Company: LFTD PARTNERS INC.
Filing Date: 2025-08-14
Form: 10-Q
Item: Part I, Item 1
Chunk 73
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 The Company monitors its investments in Ablis and Bendistillery and from time to time will evaluate whether there has been a potential impairment of value. The regulatory risks and uncertainties associated with Lifted's hemp-derived products and vapes, and the other significant risks described in our 2024 Form 10-K, have created significant adverse risks to the Company, which have caused substantial doubt about the Company’s ability to continue as a going concern.  The Company has significant financial obligations under its loan agreements with Surety Bank, and also the Company is accruing and paying 3% annual dividends on its outstanding Series A and Series B Convertible Preferred Stock. U.S. House and Senate Committees are currently considering legislation (“Bill”) that, if enacted in its current form, could result in the vast majority or all hemp-derived products containing THC becoming illegal one year after such enactment. The passage of such Bill could have a material adverse effect on the Company’s sales of hemp-derived products and the trading price of the Company’s common stock. Additional factors that could materially adversely affect the Company’s future operating results include, but are not limited to: other changes to federal laws and regulations; any new rule proposed by the federal Drug Enforcement Administration that might attempt to classify certain hemp-derived products as controlled substances; and any other federal or state laws and regulations prohibiting or restricting hemp-derived, nicotine or tobacco products, kratom or kratom extracts or byproducts (such as 7-hydroxymitragynine, which the U.S. Food and Drug Administration has recommended to be scheduled as a controlled substance), psychoactive products and/or vaping.   There is also a risk that the Company potentially might be accused of selling products containing ingredients that might be considered an analog of a controlled substance. The Company is also subject to vendor concentration risk, customer concentration risk, customer credit risk, and counterparty risk. A limited number of customers have historically made up a significant portion of the Company’s sales. Also, historically, the Company has purchased raw goods and finished goods from a limited number of suppliers. The loss of Lifted’s relationships with these customers and vendors could have a material adverse effect on Lifted’s business. The Company maintains levels of cash bank accounts that typically exceed federally insured limits. The Company has not experienced any losses in such accounts and it believes that it is not exposed to any significant credit risk on cash. No assurance or guarantee whatsoever can be given that the net income of the Company’s wholly owned subsidiary Lifted will