Illicit Brand Parent Company, S1 Enterprises, Launches Largest Employee Stock Ownership Plan in U.S. Cannabis Industry

OG article by Illicit Gardens

January 5, 2026

S1 Enterprises, parent of the Illicit cannabis brand operating in Missouri and New Jersey, has sold the company to an Employee Stock Ownership Plan (ESOP), creating the largest such program in the U.S. cannabis sector. This 100% employee-owned structure grants tax-exempt status as an S Corporation, mitigating federal burdens under Section 280E and freeing cash for growth, innovation, and benefits.

Over 500 employees gain long-term ownership stakes at no personal cost, aligning interests with company success while preserving culture, leadership, and independence. Brands like Illicit and Space Cadet, plus retail outlets such as From The Earth Missouri, continue unchanged.

Executives praised the move: Carolyn Richmond emphasized honoring dedication, Adam Diltz noted vested employee interest in stability, and Nate Ruby highlighted turning industry challenges into opportunities by prioritizing people amid 280E impacts.

The eight-month transaction involved advisors Sharp Capital Advisors, Verit Advisors, and legal firm Polsinelli for compliance. It marks the sector's first shareholder cash distribution, showcasing ESOP viability for monetization in cannabis.