I didn’t know CALL has the same business model as Whatsapp. Few more subscribers maybe someone will buy them out.
Anyway here’s the article:
NOW KRED NEWS:
KRED news is basically describing a draw down on an equity line. I added italics below and would love to have someone confirm that this type of financing doesn’t dilute the ownership as much as other types of equity sales for the stated reason that the prices are pre set and triggered by the company when THEY need it. Hence, I believe this is the reason they say it is less dilutive but please someone more mathematically astute confirm or deny that for me.
Also, since this dilutes HIS (Shaun Roberts) ownership as much as it dilutes ours, maybe it can be considered shareholder friendly.
If the above is so, well then I’d say the CEO has done an excellent job of arranging financing and in such a manner that they will NOT be slowed down by lack of cash, nor strangled by increased debt. Is this a well worn, start up tactic or is our CEO here an ascending, capital allocator architect? I’d love comments on this as when I originally read the 10Q, I couldn’t figure out why the company providing the capital would agree to provide capital for such favorable terms.
KRED news release:
KonaRed Corporation Raises First $500,000 from $12 Million Equity Line
– Funds Will be Used to Fuel Sales Expansion –
KOLOA, Hawaii, June 2, 2014 /PRNewswire/ – KonaRed Corporation (OTCBB/OTCQB: KRED), manufacturers of Antioxidant Juices from the exclusive Hawaiian CoffeeBerry(R), coffee fruit from Kona, Hawaii, announced has completed a drawdown of $500,000 of the $12 million Equity Line in place with Lincoln Park Capital Fund LLC.
“Our Form S-1 was declared “Effective” by the U.S. Securities & Exchange Commission, which therefore allows us to utilize the Equity Line. We’ve attempted to choose wisely on our sale of stock. With Lincoln Park, we are dealing with a firm with an excellent reputation and our Equity Line allows us to launch our strategic plans in a very orderly trajectory,” said CEO and Founder Shaun Roberts.
“It is important for our investors to realize that this money will be used to manufacture product to supply expected increased demand and other capital needs. The Equity Line provides a low cost of capital and is an efficient method of managing growth,” Mr. Roberts said.
Mr. Roberts continued, giving investors a snapshot of KonaRed today:
– We have an exciting, healthy line of unique products which are fully
tested and currently in production using proven manufacturing methods.
– Our partnership with VDF FutureCeuticals, Inc. provides us access to high
quality scientific research to ensure the quality of our wellness
– We’ve expanded our senior management and Board with talented, experienced
and successful individuals.
– Our customer base continues to grow as evidenced by our products being
sold on the Mainland by major customers such as Walmart and Vitamin
– Splash Beverages Group, with an historical track record of success, is
now aggressively developing new distribution channels to increase our
– We became publicly traded to provide methods to raise capital and the
Equity Line now provides us rapid access to investment capital from a
“I’m pleased with our progress over the last eight months and our team continues to be dedicated to making KonaRed a major success; a revolution in the wellness beverage sector. We’ve only just begun and are pushing hard to fulfill our plans going forward,” Mr. Roberts concluded.
The Equity Line has become increasingly accepted as an attractive and viable solution that meets the financing needs of public companies. Unlike debt, an Equity Line does not charge interest and the funds received through the Equity Line do not have to be repaid. An Equity Line allows a public company to “draw” against its equity on a periodic basis by selling registered shares of common stock to an investor for cash. An Equity Line can provide a reasonably reliable, steady stream of cash that can be used to fund ongoing working capital needs. Equity Lines usually offer less dilution and a lower cost of capital to issuers than other forms of investment. And, unlike secured debt instruments such as convertible debentures, Equity Lines do not have any security interests in the assets of the issuing company so there are no lien filings. Additionally, Equity Lines often are structured in a manner that give issuers the control over the timing and amount of shares that are sold, allowing issuers to determine when capital is raised and at what price. Such is the case with KonaRed’s Equity Line which provides the Company with full control over when to sell shares to Linclon Park Capital.
About KonaRed Corporation
KonaRed Corporation produces health and wellness nutritional products including beverages and supplements, which bring the attributes of Hawaiian Coffee fruit to an international consumer market. Our underlying business was established on August 22, 2008 and our first sales were achieved in February 2009. KonaRed became publicly traded through a merger with an existing listed company on October 4, 2013 and trades on the OTCBB and OTCQB under the symbol KRED. KonaRed, through a licensing agreement with VDF FutureCeuticals, Inc., utilizes an innovative, state of the art, proprietary processes that produce antioxidant extracts and powders from Hawaiian Coffee Fruit which are used to produce KonaRed’s Antioxidant Juices, Organic Green Teas, and On-the-Go Packs. KonaRed Corporation is headquartered in Koloa, Hawaii, and its distribution is centered in San Clemente California. KonaRed products are sold in select Kroger, Vitamin Shoppe, Whole Foods, Safeway, Walmart, 7-Eleven, and many other retail outlets throughout the US and Canada. More information about KonaRed and its products can be found at www.konared.com.