Reeds Inc. (REED)

[Bogard01]

So, are we heading up?

[$Pistol Pete$]

$REED Daily and Weekly Charts

[jhnvtjll]

That's why I stock up on their beverages in my dreams.

[Stock_Barber]

I heard sorority girls like Reed beverages...

[jhnvtjll]

No idea.

[Stock_Barber]

I recently was suggested to look into REED.

Any idea why it has fallen so much from its highs?

[boroborough]

Chris Reed is for Reed not capitalist American shareholders.

[gumbie05]

LOL! You mean the officers of the company perhaps. But nonetheless you're right...

- SMH

[boroborough]

Only for employee's

[boroborough]

Any one else curious of this http://scienceblog.cancerresearchuk.org/2017/08/15/our-milestones-how-a-combination-of-events-led-to-a-cure-for-a-rare-cancer/?utm_source=twitter_cr_uk&utm_medium=cruksocialmedia&utm_campaign=owntwitter_tweet

[bluestem1]

Not really. Q2 2012 the company had net income of 444,000 and Q2 2014 it had net income of 633,000. But it has not made an annual profit for as long as I have been tracking (going back to 2003). I tried to post the spreadsheet, but with the formatting it looked terrible.

I'm not sure what happens now. Kombucha is being written off as non-core. Just last quarter they talked about rebooting the line in the Fall and having new packaging that appeals to millennials. Fountain wasn't even mentioned on the call and looks to be DOA. Now the company is focusing on its low calorie line. So naturally brewed soda with fresh ginger and spring water with some kind of new lab created blend of artificial sweeteners. It sounds like it will appeal to no one.

The plant equipment upgrades it has been touting for the past three years appear to be a waste. It is now looking at pivoting to an asset-light model.

[gumbie05]

Has this company EVER made a profit?

[boroborough]

Bought back too soon

[gfp927z]

>> Hopefully ponytail has truly been removed from the decision-making process <<



Lol. I guess this is what happens when an ex-hippie starts a company. But wait, Steve Jobs was once into Hare Krishna and LSD, so I guess there are exceptions.





Chris could have easily raised $10-20 million when the stock was in the $7 range by just selling some shares in a secondary offering. Could have paid off all the debt and funded the plant expansion. But noo, he didn't want to dilute his ownership of the company..

[bluestem1]

Tough Situation. Has the company already blown through the 3.4 million they raised in April?

I'm already not a fan of the new CEO. Focusing on low cal soda is a waste of time. It probably means Kombucha and bag-in-a-box are dead. The company also tried to sell him as a high growth brand developer, but it looks like his resume has been scrubbed to remove 400% growth at Boylan Bottling and Detour bar. It has been replaced with failed stints at International Harvest (owned by Vince from Entourage) and a KFC franchisor in Ukraine (that was probably expropriated (my opinion)). I don't think owning KFC franchises makes one a "global brand developer" like the 7/5 press release claims.

I'm going to say something I thought I would never say. I want ponytail back (NJM's nickname). At least he cared. The activists really effed this company and if it can't hit this quarter and next, capital is going to dry up.


"Since November 2016, Mr. Stalowir has served as an independent food and beverage investment consultant working with varied consumer focused private equity groups. Prior, from April 2015 to November 2016, Mr. Stalowir served as Chief Executive Officer of privately held International Harvest, Inc., a leading supplier of certified organic, gluten free, non-GMO, vegan and raw superfoods. In 2011, Mr. Stalowir founded Global Restaurant Group, LLC (GRG) in Kyiv, Ukraine, a privately held, international quick serve restaurant operator and platform that is now YUM! Brands’ lead KFC franchisee in Ukraine. Mr. Stalowir served as Chief Executive Officer of GRG until September 2014, when, due to political and economic challenges in Ukraine, much of the investment activity in the country was suspended. GRG LLC continues to operate led by local management and recently announced the opening of an additional restaurant in the capital city of Kyiv. From 2010 to 2012, Mr. Stalowir served as Executive Partner of APTA Capital, LLC, a US private equity firm providing growth equity investments and operational leadership to consumer branded companies. From 2002 to 2010, Mr. Stalowir was Chief Executive Officer of Preferred Brand Holdings, LLC, a private equity fund backed by Emigrant Savings Bank, where he co-founded the consumer practice and led the investment and growth strategies for five portfolio companies in the food and beverage sector. From 1999 to 2001, he served as President, North American division of Tomra Systems, ASA, a publically traded Norwegian company and the global leader for beverage container return and processing systems and reverse vending machines. Prior, Mr. Stalowir served in marketing and general management positions with the Coca-Cola Company and the Quaker Oats Company."

[NewJerichoMan]

New CEO is doing what the company needs to survive.

It's gonna get worse before it gets better, and that's if it ever does get better. Company drifting toward bankruptcy.

Reed’s entered into Warrant Exercise Agreements with Raptor/Harbor Reeds SPV LLC and three other investors holding participation rights in the transaction to reprice warrants to purchase 1,906,925 shares of Reed’s common stock. The repriced warrants have an exercise price per share of $1.50 and were revised to modify language pertaining to “Fundamental Transactions”. Restrictions upon exercise have been waived as to 1,093,750 warrant shares being exercised for aggregate gross proceeds to the company of $1,640,625. The Lead Investor also received the right to designate one non-voting observer to attend meetings of the board of directors.

[NewJerichoMan]

New CEO.

No idea if this ship can be turned around but this was a necessary step.

http://globenewswire.com/news-release/2017/07/05/1038966/0/en/Reed-s-Inc-Announces-New-CEO.html#.WV0lX2QmROs.twitter

[boroborough]

REED sale slowing

[boroborough]

You'll never own a home through REED shares.

[NewJerichoMan]

Do you have access to IRI data?

[boroborough]

Celsius HoldeningsCELHs have been an enormous achievement. We loaded up under a dime... LBIX was an interest but can not see a rewarding future as has been with CELH. Ooopps

[boroborough]

That feels soooo good

[NewJerichoMan]

Monday will either confirm or some suckers are about to get roasted.

Just looked at the closing price. It was the latter. Ouch for the retail that was late to the game and slow to get out.

Will watch to see if this goes back below $2.50. Might consider buying then. Hopefully ponytail has truly been removed from the decision-making process.

[NewJerichoMan]

I see that.


Item 1.01 Entry into a Material Definitive Agreement

On April 21, 2017 (“Closing Date”), pursuant to a Securities Purchase Agreement (“Purchase Agreement”), Reed’s Inc., a Delaware corporation (“Reed’s” or the “Company”) sold and issued a secured convertible subordinated non-redeemable note in the principal amount of $3,400,000 (“Note”) and a warrant to purchase 1,416,667 shares of common stock (“Warrant Shares”) to Raptor/Harbor Reeds SPV LLC (“Purchaser”). The Note bears interest at a rate of 12% per annum, compounded monthly on a 360-day year/ 30-day month basis. The Note is secured by a second priority security interest in the Company’s assets, which is subordinate to the first priority security interest of PMC Financial Services Group, LLC (“PMC”). The Note matures on the two-year anniversary of the Closing date and may not be prepaid. After 180 days, the Note may be converted, at any time and from time to time, into 1,133,333 shares of common stock of the Company (“Conversion Shares”). The Warrant will expire on the fifth (5th) anniversary of the Closing Date and have an exercise price equal to $4.00. The Warrant will not be exercisable until 180 days after the Closing date. The Note and Warrant contain customary anti-dilution provisions and the Conversion Shares and Warrant Shares are subject to a registration rights agreement. The investor was granted a right to participate in future financing transactions of the Company for a term of two years.

The Company intends to use the net proceeds from the offering of approximately $3,240,000 for working capital and general corporate purposes. Wunderlich Securities, the Company’s placement agent, received a fee of $160,000 for placement agency services.

As a condition to PMC’s approval of the transaction and Purchaser’s subordinated security interest, on April 21, 2017, Reed’s and PMC entered into Amendment Number Fifteen to Amended and Restated Loan and Security Agreement changing the Revolving Loan Maturity Date, Term Loan Maturity Date, Cap Ex Loan Maturity Date and Term Loan B Maturity Date from January 1, 2019, to October 21, 2018.

On April 19, 2016, three accredited investors that are party to that certain Securities Purchase Agreement dated May 26, 2016 and hold participation rights in the Company’s financing transactions agreed to waive their participation rights with regard to the April 24, 2017 financing. In consideration, these investors’ participation rights, expiring in May 2017, were extended for a period of two years. In addition, the Company increased the terms of their outstanding warrants by one year and reduced the exercise price from $4.25 to $3.00 and issued five-year warrants to purchase an aggregate of 210,111 shares of common stock at the exercise price of $3.00 to these investors. The newly issued warrants contain customary anti-dilution provisions.

The Company issued a press release on April 24, 2017, announcing the financing transaction. A copy of the press release is attached to this Current Report on Form 8-K as Exhibit 99.1.

[boroborough]

Just placed an opinion on it

[NewJerichoMan]

Still here? Any idea what is going on? No public mention of the mythical soda fountain, plant completion, or new financing; but the stock price is sure acting like some major event happened.

[NewJerichoMan]

Missed another deadline, and on significant volume, the price goes even higher. Smacks of inside info. Monday will either confirm or some suckers are about to get roasted.

[NewJerichoMan]

Why is this dog moving? Filed an NT but apparently the numbers are good? Hard to believe. Maybe they finally finished the plant? Also hard to believe given all the delays.

[boroborough]

ABRW liquidated its' brewery after acquiring the Bucha Live Bucha brands. Unexpectedly the NEW AGE BEVERAGE was able to venture with a well established tea beverage producer. Just wish Chris snatched the Bucha Live Kombucha Comlany...

[NewJerichoMan]

The TTM info is the actual. The FTM estimates are mine. I took Q3 results, multiplied by 4, and inflated them at past growth rates. The exception is $nBEV, which is a rapidly changing and growing company.

[bluestem1]

Hey Now!

Nice info. Are the NTM estimates your own or Wall Streets?

[NewJerichoMan]

2016 Year-End Peer Group Comparison

Would $REED please go to the back of the class. They're putting the "lag" in laggard.

[bluestem1]

I was talking more about timing and selling out of my position before March 2017 when Chris Reed's small option position expires.

[NewJerichoMan]

Maybe it is wishful thinking, but I don't expect to be here for much longer.

You mean in the $4 range?

[bluestem1]

Yes, there was an updated filing yesterday, REED was able to get an extension out to January 1, 2019, but the company will begin making monthly payments on the CapEx loan in Feb 2017, my calculation is $120K per month in principal and interest. The company has taken on quite a bit of debt to finish the LA plant and can't seem to get to the economies of scale to be profitable.

I am waiting on the soda fountain and to see if they can win the Panera Bread contract. Maybe it is wishful thinking, but I don't expect to be here for much longer.

[NewJerichoMan]

They had a credit revolver coming due in November of this year. Any word on whether it was extended for another 2-year term? I believe this was the impetus for the share offering in the first part of the year. Without that cash on the books, the revolver would be closed, and without the revolver their would be cash flow issues.

[bluestem1]

Chris Reed Option Purchase

The first portion of CR's open market option purchase expires at the end of the week. If the stock can close in the 4 range he should make around 175% and the 3/18/2017 options are still outstanding. With the introduction of soda fountain and its affect on the company, using an options strategy makes more sense than purchasing common. FWIW, in the past there have been press releases close to option expiration.

https://www.sec.gov/Archives/edgar/data/1140215/000149315216012660/xslF345X03/form4.xml

[stocktrademan]

REED bullish 4.082



normal chart


log chart

[kxkyle]

Because the product tastes great, Ice Hole!

[eneels01]

Flat revenue and losing money. Why is this still above $1?

[NewJerichoMan]

$3.60 for this FUBAR'ed stock. Should've held longer.

[boroborough]

THIS IS AMERICA... WHERE THE BRITISH ONE PERCENT ONLY COME OUT ON TOP. WATCH REED EITHER GO PRIVATE OR BOUGHT OUT. YOU MAKE A COUPLE OF BUCKS.

[NewJerichoMan]

If this doesn't illustrate how FUBAR'ed this company is...

http://ih.advfn.com/p.php?pid=nmona&article=72243725&symbol=REED

Sadly, I still wouldn't be surprised if it does a "slow melt" up to $3 within the next month.

[NewJerichoMan]

No pop to $3 on meh earnings. In at $2.50 and out at $2.60. No loss but no win either. Will revisit around Q3 earnings date. Still think the market is under-valuing but this company has a lot of trust to regain after falling from $6 to $2.40.

[NewJerichoMan]

Earnings on August 4. With a decent results announcement, this could be back above $3. They need it, too. They received the letter of delisting from NYSE for being below $50M market cap. Have until December 2017 to rectify though.

They recently expanded their distribution footprint but I get the feeling management is substandard, like consistently.

That said, I put a few shekels down and hope for a quick pop to trade.

[NewJerichoMan]

Did a little research into the 10K, and I mean little, and their is a real risk the revolver isn't renewed come December. Probably explains the secondary and why the stock price hasn't bounced back yet. This valuation level may be the new norm for this company.

Anyone analyzed in depth to see if bankruptcy is an outcome whose probability is discernably above zero?

[NewJerichoMan]

The worm has done turned. Up from the lows of $2.40 (~15% increase), it'll be interesting to see what the Q2 results bring.

[jhnvtjll]

I used to be an investor of REED many years ago. I still watch the chart a couple times a month. I no longer buy low-priced Big Board stocks, so this isn't something I would touch now.

[NewJerichoMan]

They aren't turning a profit yet but the top line is growing. I'm an investor in ABRW / Bucha / NAB. Stumbled upon Reed's using them as a comp for ABRW.

Without doing any deep dive yet, they appear undervalued compared to the market. Might be as simple as being OTC, the placement, and being oversold. Or, there could be deeper issues. Not sure yet.

[jhnvtjll]

I wonder why it's trading much lower than the offering price.

Upon the closing of this financing, Reed’s will receive gross proceeds of approximately $2.2 million resulting from the issuance and sale of 648,294 shares of Common Stock (the “Common Stock”) and 324,147 Warrants to purchase Common Stock (the “Warrants”), at a combined offering price of $3.40 per share. The warrants have an exercise price of $4.25 per share and have a term of 5-years.