Business Context and Reporting Period
This Form 8-K is filed by Eastside Distilling, Inc. (not Beeline Holdings, Inc., which is a subsidiary) for the reporting period ending December 27, 2024, with events extending through January 2, 2025. The filing details a Private Investment in Public Equity (PIPE) offering of Series G Convertible Preferred Stock and warrants, as well as a termination agreement with a former service provider.
Key Financial Metrics and Transactions
- PIPE Offering Proceeds (Recent Period): From December 27, 2024, to January 2, 2025, the Company sold units for total gross proceeds of $975,000.
- PIPE Offering Proceeds (Cumulative): Since the offering commenced on November 26, 2024, total gross proceeds reached $2,633,593.
- Securities Issued (Recent Period): 1,911,765 shares of Series G Convertible Preferred Stock and warrants to purchase 955,882 shares of Common Stock.
- Securities Issued (Cumulative): 5,163,908 shares of Series G and warrants to purchase 2,581,954 shares of Common Stock.
- Termination Payment: On December 31, 2024, the Company paid $100,000 in cash and issued 250,000 shares of Series G to Joseph Gunnar & Co., LLC to settle contractual rights.
- Use of Proceeds: Net proceeds are designated for working capital and general corporate purposes.
Material Changes and Insider Activity
The filing reports significant capital raising activity and a change in contractual obligations:
- Insider Investment: Nick Liuzza, Jr., CEO of Beeline Financial Holdings, Inc. (a subsidiary) and a principal holder of prior preferred stock, purchased $500,000 worth of units in two tranches ($425,000 on Dec 27 and $75,000 on Dec 30).
- Contractual Termination: The Company terminated its engagement letter with Joseph Gunnar & Co., LLC, waiving rights of first refusal and tail fees in exchange for the cash and stock payment noted above.
Outlook, Risks, and Contingencies
The Company intends to utilize the raised capital for working capital and general corporate purposes. The offering is part of a broader plan to raise up to $3,037,800 in total gross proceeds. The securities were sold pursuant to exemptions under Section 4(a)(2) of the Securities Act and Rule 506(b). No specific forward-looking financial guidance or revenue projections were provided in this filing.
Key Facts for Investor Verification
- Verify the total dilution impact of the 5,163,908 Series G shares and associated warrants on existing common shareholders.
- Confirm the conversion terms and liquidation preferences of the Series G Convertible Preferred Stock as detailed in the Certificate of Designation (Exhibit 3(a)(1)).
- Review the specific "piggyback" registration rights granted to Joseph Gunnar & Co., LLC regarding the resale of underlying common stock.
- Assess the remaining capacity of the offering, which has raised approximately 86.7% of the targeted $3,037,800.