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DESCRIPTION OF THE BUSINESS OF LFTD PARTNERS INC
 9 Months Ended
Sep. 30, 2026
DESCRIPTION OF THE BUSINESS OF LFTD PARTNERS INC  
DESCRIPTION OF THE BUSINESS OF LFTD PARTNERS INC

NOTE 1 – DESCRIPTION OF THE BUSINESS OF LFTD PARTNERS INC.

 

LFTD Partners Inc., Jacksonville, Florida, was organized under the laws of the State of Nevada on January 2, 1986. We were a former shell company, primarily engaged in identifying, structuring, and seeking to execute acquisitions of all or a portion of one or more operating businesses. Between 2011 and 2013, we acquired and operated several businesses linked to the defense industry. In 2018, we shifted focus to the cannabis industry where we have operated since. Shares of the Company’s common stock are listed for trading on the OTCQB Venture Market under the symbol “LIFD”.

 

LFTD Partners is the parent corporation of Lifted Liquids, Inc. d/b/a Lifted Made, d/b/a Urb Finest Flowers, d/b/a Highlandia and d/b/a LM Nutra, Kenosha, Wisconsin (“Lifted Made” or “Lifted”), which manufactures and sells hemp-derived and other psychoactive products under its Urb Finest Flowers (“Urb”) brand (www.urb.shop) and other brands, hemp-derived beverages under the Highlandia brand (www.Highlandia.com), and hemp-free health and wellness gummies under its Mielos brand (www.mielos.com). Lifted also has plans to manufacture and sell hemp-free gummies in multiple flavors under a new brand. Lifted also manufactures and sells hemp-derived and hemp-free products to private label clients, and licenses the Urb brand name to Extrax NM LLC in New Mexico for use on marijuana products. LFTD Partners also owns a 4.99% non-controlling equity interest in hemp-derived beverage and products maker Ablis (www.Ablis.shop), and in craft distiller Bendistillery, Inc. (www.Bendistillery.com), both located in Bend, Oregon.

 

LFTD Partners is completely dependent upon revenue from Lifted to stay in business and to remain solvent. If Lifted’s revenue were to be seriously disrupted, LFTD Partners would face severe financial difficulties including a potential bankruptcy.

 

At this point in time, Lifted’s remaining major line of business—intoxicating hemp-derived products—is at severe risk of serious disruption and potential elimination. During the third quarter of 2026, Lifted discontinued its other former major line of business—products containing kratom-derived 7-hydroxymitragynine, MGM-15, and other kratom-derived compounds (collectively, “7-OH”).

 

In November 2025, Section 781 of Public Law 119-37 enacted changes to the federal definition of hemp (the “Federal Hemp Restrictions”) that would cause many intoxicating hemp-derived products to no longer qualify as hemp and instead be treated as marijuana under federal law. These changes include restrictions on intermediate and final hemp-derived cannabinoid products containing cannabinoids that “are not capable of being naturally produced by a Cannabis sativa L. plant”; a total THC limit of 0.3% on a dry weight basis, including THCA; a limit of 0.4 milligrams per container of final hemp-derived cannabinoid products for the combined total of THC and other cannabinoids with similar effects; and restrictions on products containing cannabinoids that can occur naturally in the cannabis plant but “were synthesized or manufactured outside the plant.”

 

These changes were originally scheduled to take effect on November 12, 2026. On September 2, 2026, the President signed into law H.R. 6500, the “Continuing Appropriations and Extensions Act, 2027,” enacted as Public Law 119-103. Section 2019 of that law postponed, until December 11, 2026, the application of the 0.3% total THC limit, including THCA; the 0.4-milligram per-container limit for final hemp-derived cannabinoid products; and the exclusion from the definition of hemp of intermediate and final hemp-derived cannabinoid products containing cannabinoids that the cannabis plant can naturally produce but that “were synthesized or manufactured outside the plant.” However, the exclusion of intermediate and final hemp-derived cannabinoid products containing cannabinoids that cannot naturally be produced by the cannabis plant remains scheduled to take effect on November 12, 2026, at which time those products would no longer qualify as hemp and would instead be treated as marijuana under federal law. Even if the Federal Hemp Restrictions are further delayed, modified or repealed, numerous states have enacted laws restricting or prohibiting sales of intoxicating hemp-derived products.

 

Pursuant to a temporary scheduling order issued by the U.S. Drug Enforcement Administration (“DEA”) and published in the Federal Register on August 26, 2026, mitragynine pseudoindoxyl, MGM-15 and MGM-16, including certain related forms, were temporarily placed in Schedule I of the Controlled Substances Act, effective August 26, 2026. On October 14, 2026, the DEA published a new notice of intent proposing to temporarily place 7-hydroxymitragynine and mitragynine pseudoindoxyl in Schedule I when either substance alone, or their combined amount when both are present, exceeds specified thresholds. As of the date of this report, the proposed temporary scheduling order had not been issued, and the August 26, 2026 temporary scheduling order remained in effect.

 

In July 2026, in response to federal regulatory developments and uncertainty affecting 7-OH, Lifted ceased all sales of 7-OH, relinquished all ownership, possession and control of its remaining 7-OH inventory to a third party, and wrote off that inventory against the previously recorded inventory reserve.

 

The Federal Hemp Restrictions also threaten to materially disrupt or eliminate Lifted’s remaining major line of business. Lifted has experienced slowing sales activity and slower collection of accounts receivable in response to regulatory uncertainty and changing market conditions and has reduced its remaining inventory of certain affected hemp-derived products. If Lifted’s remaining major line of business is materially disrupted or eliminated, Lifted’s operating results, liquidity and cash flows would be materially adversely affected. Consequently, Lifted could experience significant liquidity constraints that could impair its ability to satisfy payroll, debt service, accounts payable, rent, insurance, taxes, professional fees, and other operating obligations as they become due. If the Company is unable to offset these revenue declines through cost reductions, asset sales, financing transactions, or diversification initiatives, management believes that the Company could become insolvent and may be required to seek protection under applicable bankruptcy laws.

 

These conditions raise substantial doubt about the Company’s ability to continue as a going concern for the twelve months following the issuance of these financial statements. To address these conditions, management and the boards of directors of Lifted and LFTD Partners have implemented, and continue to evaluate, the following initiatives to preserve liquidity, reduce operating costs, monetize assets and diversify the Company’s operations, although there can be no assurance that these initiatives will be completed successfully or will be sufficient to alleviate the substantial doubt regarding the Company’s ability to continue as a going concern:

 

 

(1)

During 2026, Lifted reduced its workforce, including employees and independent contractors, from nearly 200 at its peak to approximately 68 as of the date of this report. Significant additional workforce reductions may be necessary if Lifted’s remaining major line of business is seriously disrupted or eliminated. Such reductions could involve personnel with valuable skills, experience and relationships, which could materially adversely affect Lifted’s future operations and revenues.

 

 

(2)

On July 22, 2026, Lifted entered into a binding agreement to sell its real property located at 5511 95th Avenue, Kenosha, Wisconsin for a purchase price of $1,500,000. The sale closed on September 29, 2026. At closing, Lifted used $841,110 of the sale proceeds to satisfy the Business Loan, consisting of all outstanding principal and accrued interest and a $9,100 prepayment penalty. Upon payment, the Business Loan was satisfied in full and terminated, and Surety Bank’s first-priority mortgage on the property was released. The Company has no remaining bank debt outstanding. The remaining net sale proceeds were added to Lifted’s working capital.

 

 

(3)

Given the discontinuation of Lifted’s 7-OH business and the serious regulatory risks confronting its remaining major line of business, LFTD Partners believes there is an urgent need for Lifted and LFTD Partners to diversify away from intoxicating hemp-derived products and 7-OH.

 

 

a.

In the case of Lifted, management plans to manufacture and sell hemp-free gummies in multiple flavors under a new brand and is exploring the possibility of manufacturing and selling, or purchasing and reselling, other hemp-free and kratom-free products that may appeal to consumers whose access to intoxicating hemp-derived products and 7-OH has been reduced or eliminated as described above.

 

 

b.

In the case of LFTD Partners, in June 2026, the Board of Directors of the Company voted unanimously to authorize the CEO of the Company to identify, negotiate and sign contracts to acquire multifamily housing properties and/or laundromats, and in that connection to hire investment bankers and raise capital to support those acquisitions. Pursuant to that resolution, the CEO of the Company, working in conjunction with our President and CFO, have conducted due diligence investigations of many apartment buildings and laundromats, and have made written and oral offers pursuant to which newly formed subsidiaries of the Company would acquire multiple apartment buildings along the East Coast of Florida. To date, none of these offers have resulted in any legally binding agreements, but these efforts are continuing. No guarantee or assurance can be given that any apartment buildings or laundromats will be acquired by the Company, nor on any particular pricing, terms and conditions.

 

 

 

 

 

It is unclear at this point in time how much debt and/or equity can be dedicated or raised by the Company for acquisitions of apartment buildings or laundromats. The Company has engaged, and is continuing to engage, in discussions with certain banks, investment banks and other potential sources of capital for this purpose. No guarantee or assurance can be given that the Company’s capital raising efforts to purchase apartment buildings and/or laundromats will be successful. The Company’s challenges in raising capital relate to several factors, including: potential investors’ and lenders’ concerns regarding the future of Lifted’s intoxicating hemp-derived business and the discontinuation of its 7-OH business; the fact that the Company’s common stock is not currently traded on NASDAQ or on another national exchange; and the low trading volume of the Company’s stock on the OTCQB Venture Market. Also, because the Company has limited cash and Lifted must devote available capital to expansion opportunities in hemp-derived THC beverages, hemp-free gummies and other new consumer products, it has been difficult to pursue apartment-building acquisitions requiring significant equity contributions. Consequently, the Company is focusing a significant portion of its due diligence efforts on properties that include seller financing or assumable debt.

 

 

 

 

 

If and when the Company is successful in acquiring one or more apartment buildings and/or laundromats, the CEO of the Company has been authorized by our Board of Directors to implement a change in the Company’s name and trading ticker symbol, in order to highlight the Company’s diversification away from its historical reliance on intoxicating hemp-derived products and 7-OH. There can be no assurance that the Company will successfully diversify or do so within any particular timeframe.

 

Reference is hereby made to the disclosures in the following section, which are hereby incorporated by reference thereto:

 

NOTE 3 - RISKS AND UNCERTAINTIES

Going Concern

 

Our principal headquarters are located at 14155 Pine Island Drive, Jacksonville, Florida 32224. Our telephone number is (847) 915-2446. Our corporate website address is www.LFTDPartners.com.