NOTE 5 – PROPERTY AND EQUIPMENT, NET

Property and Equipment consist of the following:

The useful lives of the Company’s property and equipment by asset class are as follows:

The Company recognized an impairment charge of $64,628 against its hemp-specific fixed assets during the second quarter of 2026, bringing the cumulative impairment recognized on hemp-specific fixed assets to $208,049 as of June 30, 2026. Reference is hereby made to the disclosures in the following sections, which are hereby incorporated by reference thereto:

NOTE 2 – BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

Fixed Assets

NOTE 3 – RISKS AND UNCERTAINTIES

Going Concern

In the Consolidated Statements of Operations, depreciation expense is consolidated with amortization expense. Depreciation expense related to machinery and equipment and depreciation expense related to Lifted’s main operations building located at 5511 95th Avenue, Kenosha, Wisconsin (“5511 Building”) totaling $68,648 and $145,030 for the three and six months ended June 30, 2026, was allocated as overhead to finished goods as of June 30, 2026. After this allocation, depreciation expense of $47,047 and $109,937 was recognized during the three and six months ended June 30, 2026.

Comparatively, depreciation expense related to machinery and equipment and depreciation expense related to 5511 Building totaling $76,581 and $153,948 for the three and six months ended June 30, 2025, was allocated as overhead to finished goods as of June 30, 2025. After this allocation, depreciation expense of $62,512 and $124,777 was recognized during the three and six months ended June 30, 2025.