The Company reports discontinued operations by applying the following criteria in accordance with ASC 205-20, Presentation of Financial Statements – Discontinued Operations: (1) Component of an entity; (2) Held for sale criteria; and (3) Strategic shift.

The operating results of Craft C+P have been classified as discontinued operations during the nine months ended September 30, 2024. The consolidated financial statements for the prior periods have been adjusted to reflect comparable information.

Income and expense related to Craft C+P were as follows for the nine months ended September 30, 2024:

On July 25, 2025, the Company entered into a Debt Satisfaction Agreement (the “DSA”) with Bridgetown Spirits and three individuals (the “Buyers”) including Geoffrey Gwin, the President of Bridgetown Spirits, pursuant to which the Company transferred to the Buyers all 530,000 shares of its Bridgetown Spirits common stock held by the Company in exchange for the satisfaction of outstanding amounts payable by the Company to the Buyers totaling $0.4 million As a result of the foregoing, Bridgetown Spirits is no longer a subsidiary of the Company. The Company recorded $0.7 million to loss on extinguishment of debt in the consolidated statements of operations and comprehensive loss for the three and nine months ended September 30, 2025.

In connection with the DSA, Bridgetown Spirits issued a Senior Secured Original Issue Discount Promissory Note and Security Agreement (the “Note”) in the principal amount of $0.1 million payable to the Company with an original issue discount of $25,000. The Note is receivable as follows: (i) $50,000 is receivable on April 24, 2026, and the remaining $50,000 is receivable on July 25, 2026. The Note is secured by the assets of Bridgetown Spirits. The Note is included in prepaid expenses and other current assets on the consolidated balance sheet as of September 30, 2025.

The assets and liabilities of Bridgetown Spirits have been classified as held for sale as of December 31, 2024. The operating results of Bridgetown Spirits and the spirits segment have been classified as discontinued operations during the three and nine months ended September 30, 2025 and 2024, respectively. The consolidated financial statements for the prior periods have been adjusted to reflect comparable information.

Assets and liabilities related to Bridgetown Spirits were as follows as of December 31, 2024:

(Dollars in thousands)	2024
Assets
Current assets:
Cash and cash equivalents	$	310
Inventories		1,493
Prepaid expenses and other current assets		75
Accounts receivables, net		134
Current assets of discontinued operations held for sale		2,012
Intangible assets, net		822
Right-of-use assets		372
Property and equipment, net		95
Other assets, net		180
Total Assets	$	3,481

Liabilities
Current liabilities:
Accounts payable	$	136
Accrued liabilities		170
Current portion of lease liabilities		186
Total current liabilities		492
Lease liabilities, net of current portion		163
Total liabilities	$	655

Income and expense related to Bridgetown Spirits and the spirits segment were as follows for the nine months ended September 30, 2025 and 2024:

(Dollars in thousands)	2025			2024

Net sales, spirits	$	1,143		$	1,977
Cost of sales, spirits (inclusive of depreciation)		956			1,476
Salaries and benefits		348			444
Marketing and advertising		286			254
Total operating expenses		1,590			2,174
Loss from operations		(447	)		(197	)
Other income		995			35
Net income (loss) from discontinued operations		548			(162	)
Loss from disposal of discontinued operations		(1,293	)		-
Net loss	$	(745	)	$	(162	)

There was a 47% non-controlling interest in Bridgetown Spirits prior to the disposal date. All of the net loss attributable to non-controlling interests in the consolidated statements of operations is related to Bridgetown Spirits.