RDE Inc. (RSTN)

[Altitrade Partners]

What we want to know is why the former CEO of Restaurants.com, Kenneth Chessick, when he decided to sell his company to UBID, was willing to take shares in the new company at a price of $9.00 a share?

Recent Mergers and Acquisitions

Effective March 1, 2020, we entered into an asset purchase agreement with Restaurant.com, Inc., a private Delaware corporation. We purchased substantially all assets, but no liabilities, of Restaurant.com for a total purchase price of $5,500,000, of which $725,000 was cash, $3,275,000 was in the form of 363,889 shares of our common stock and the balance of $1,500,000 was in the form of a three year promissory note bearing annual interest of 6%. Kenneth Chessick, the former President, CEO and Chairman of Restaurant.com entered into a 12-month consulting agreement with the Company.

Recent Financings

On August 15, 2019, we entered into a convertible note financing with EMA under which we issued a convertible promissory note in the principal amount of $112,750 from which will be deducted an original issue discount of $6,750, bearing interest of 8% per annum with a maturity date of August 15, 2020. The convertible promissory note is past due. The note is convertible into shares of our common stock at a conversion price equal to the lesser of: (i) $9.00 or (ii) the Variable Conversion Price (defined as 70% multiplied by the average of the three lowest volume weighted average prices of our shares of common stock during the ten consecutive trading day period immediately preceding the trading day that we receive EMA”s notice of conversion). We are required at all times to have common stock coverage of any potential conversion of a sufficient number of shares of our common stock into which the unpaid principal and accrued interest of the note is convertible. The initial coverage has been set at 11,087 shares. We issued a warrant to EMA (the “EMA Warrant”) exercisable for three years to purchase up to 18,667 shares that we are registering in this Offering Circular at an exercise price of $9.00 per share.

Also, when they divested the Sky Auction subsidiary the former CEO, Michael Hering took common stock at $7.50 a share

In July, 2020 we entered into a Consent and Agreement to Stock Sale Agreement and Mutual Release (“Stock Sale Agreement”), a Sales Marketing Agreement (“Marketing Agreement”) and a Consulting Agreement with each of Michael Hering and Salvatore Esposito, the founders of Skyauction.com, Inc. (“SkyAuction”). Under the terms of the Stock Sale Agreement, (i) we sold all 1,000 issued and outstanding shares of common stock of SkyAuction which we owned to Sky Auction Acquisition, LLC., a company controlled by Michael Hering, (ii) the past due principal amount of the note we issued to SkyAuction when we acquired it in November 2018, $2,500,000 (the “Merger Note”), was converted into shares of our common stock at a price of $7.50 per share or 333,333 shares of our common stock to be issued pro rata to the SkyAuction shareholders at the time of the merger with us, excluding Messrs. Hering and Esposito, and (iii) the accrued and unpaid interest totaling $180,000 as of June 30, 2020 under the Merger Note was forgiven.

https://www.otcmarkets.com/filing/html?id=14510195&guid=sAeqUa7s8DVwY3h