Nothing to worry about you state! From the 10-Q!
Management believes that the cash balance on June 30, 2012, current level of working capital, anticipated cash that will be received from expected future sales, and the additional $4,588,516 net proceeds received through the issuance of equity securities in August 2012 will be sufficient to sustain operations for the next twelve months. See Note 17 (A), Equity Offering.
In January 2012, the Company entered into a factoring agreement whereby it sells its wholesale trade accounts receivable to a factor without recourse . Under the agreement, the factor assumes the risk of loss resulting from a customer’s financial inability to pay at maturity, in exchange for a fee of 1.25% on the first $5,000,000 in gross factored receivables. The fee for factored receivables in excess of $5,000,000 is 1.00%. The minimum aggregate factoring charge payable under the agreement is $50,000 per year.
Six Months Ended June 30, 2012
In February 2012, The Company issued 1,500,000 shares for $1,493,100 ($1.00/share), net of direct offering costs of $6,900. The Company also issued the holders one half of one common share stock purchase warrant (750,000 shares) with a maturity of 2 years and 6 months. The exercise price is $1.80 and the Company may accelerate the expiry date of the warrants if the market price of the common stock reaches $4.00 for at least 20 consecutive trading days.
So you pay them to sell your goods? right!
(B) Marketing Commitment – House of RYU
In March 2012, the Company executed an agreement with an athletic center in Las Vegas, Nevada, whereby such center, rebranded as the House of RYU, is licensed to use the Company's brand and sell its products. In exchange, the Company may use the center for various sports marketing initiatives. The term of the agreement is three years, and the Company will pay $150,000 in rebranding fees. A total of $100,000 had been paid as of June 2012 and an additional $25,000 was paid in July 2012. The rebranding fees are expensed as incurred.
(A)
Equity Offering
In April 2012, the Company completed a registration statement to list on Canadian TSX Venture Exchange (“TSXV”). In connection with the listing, in August 2012 the Company completed an initial public offering and issued 5,882,500 shares of common stock for $4,588,516 ($0.84/share), net of direct offering costs of $368,483. See Note 6, Other Current Assets, regarding the deferred offering costs associated with the offering as of June 30, 2012
I can go on!!!!!
