Business
Eastside Distilling, Inc. Announces Letter of Intent to Divest its Redneck Riviera Spirits® Business, gives preliminary guidance for Third Quarter results and key strategic objectives for sustainable growth going forward
PORTLAND, Ore., Oct. 29, 2020 /PRNewswire/ -- Eastside Distilling Inc. (NASDAQ: EAST) (the "Company") announced today it has entered into a non-binding letter
About this update from Beeline Holdings, Inc.
[{"type":"text","content":"PORTLAND, Ore., Oct. 29, 2020 /PRNewswire/ -- Eastside Distilling Inc. (NASDAQ: EAST) (the \"Company\") announced today it has entered into a non-binding letter of intent to terminate its Amended and Restated License Agreement with Rich Marks LLC and John D Rich Tisa Trust (collectively (\"Rich Marks\") and to sell certain assets to Redneck Spirits Group, LLC (\"RSG\"). The Company anticipates proceeds in excess of $8MM including a non-refundable \"Good Faith Deposit\" if RSG fails to meet certain closing conditions. The Company expects to reach a Definitive Agreement and close the transaction in the current quarter. The transaction encompasses the Redneck Riviera products including Redneck Riviera Whiskey®, Granny Rich Reserve®, and Howdy Dew! ® finished and dry goods as well as a portion of the Redneck Riviera barrel stock. The Redneck Riviera partnership with John Rich has transformed the Company into a national distributor of craft spirits. The divestiture of Redneck Riviera aligns with the Company's previously stated intent to focus its resources on its core growth platforms of craft spirits, cocktails, and mobile canning.\nThe Company appointed Roth Capital Partners, LLC, as exclusive financial advisor, and Harriton & Furrer LLP, as legal advisors, to assist with the transaction. The Company will further discuss the transaction's impact on its fiscal year 2021 outlook when it releases its second quarter results in November.\nPreliminary Third Quarter Financial Results and a Sustainable Growth PlanThe Company expects 3rd quarter consolidated revenues between $4.5-$5 million and anticipates reporting an improvement in EBITDA from Q2 2019 and a sequential improvement over the prior quarter. The Company continues to believe it will make more improvements in EBITDA in Q4. \nWith the exit of Redneck Riviera, the Company now turns its focus to five key objectives for sustainable growth. These five objectives include (1) achieving cash neutral quarterly operating results, (2) restructuring and extending remaining debt, notes, and the Azuñia earnout beyond 2021, (3) adding liquidity for short term working capital, (4) building spirits brand portfolio plan that grows volume with profit focused on the Azuñia Brand, and further depletion of remaining barrel inventory, and (5) implementing a strategic growth plan for Craft Canning. \nT...