CALABASAS, Calif.--(BUSINESS WIRE)--Resonate Blends, Inc. (OTCQB:KOAN), a cannabis-based holding company (“Resonate” or “the Company”), announced today an update to shareholders on the filing of its Information Statement on Schedule 14C with the Securities and Exchange Commission regarding the spin-out of Textmunication, Inc. from the holding company and its execution of several key business initiatives.
On May 27, Resonate completed the filing of its Information Statement on Schedule 14C to officially start the spin-out process of Textmunication, Inc. (“Textmunication”). During the closing of the Company’s acquisitions of Resonate Blends, LLC and Entourage Labs, LLC, the Company made its intention known to be a pure play cannabis holding company. Over the last several months, the Company has been taking methodical steps to restructure the Company to reach that goal. The Company has raised outside capital, retired debt that was not consistent with the long term strategic requirements of the Company, negotiated and has now executed the spin-out of Textmunication, the texting operating subsidiary of the Company, and hired CORE IR and Boustead Securities to work with us on the long term financial requirements of the Company.
To determine an open and fair price for the spin-out, the Company commissioned a Pricing Analysis on the sale of the Textmunication entity and determined that the consideration for the sale of Textmunication shall consist of the cancellation by certain shareholders of the Company, including Wais Asefi, the Company’s former officer and director, of 4,822,029 shares of the Company’s common stock (the “Cancelled Shares”). Once the sale is completed, the Cancelled Shares will be returned to treasury, reducing the Company’s outstanding share count. Wais Asefi will remain as officer and director of Textmunication and the shareholders cancelling their shares shall own the business and it will no longer be affiliated with the Company. The Company would like to thank Mr. Asefi for his service to the Company and wish him the best going forward.
While this restructuring of the Company has been underway, the Company has assembled a world class team that has been hard at work preparing the way for the introduction of the Company’s new brands. Resonate was started with a simple mission --- to demystify cannabis. The Company has developed the Resonate System to make cannabis understandable, accessible and predictable to support the Wellness Lifestyle. The Company believes the creation of value-added brands will generate the greatest value in the cannabis industry. The Company’s goal is to be a leader in high value cannabis brands through product innovation, manufacturing and technology partnerships, strategic acquisitions and cutting-edge distribution methods. The Company’s experienced leadership team can now concentrate on the complexities of building a quality cannabis holding company, while remaining mindful of COVID-19 and the impact the pandemic is having on many aspects of the cannabis industry.
Resonate is focused on building, delivering and developing innovative products and distribution methods specifically tailored to the Wellness Lifestyle market. To this end, the Company has recently announced key initiatives centered on product development, investor relations and an investment banking partnership, which the Company believes will advance its narrative to both the cannabis and public market communities. The Company has:
- Developed a partnership with Vertosa, a leading provider of safe, reliable emulsion bases for infused product developers;
- Retained CORE IR, a leading boutique investor relations firm, to provide comprehensive investor relations and shareholder communications services and assist the Company in expanding market awareness and engagement with the institutional and retail investment communities; and
- Engaged Boustead Securities, LLC as the Company’s placement agent and financial advisor.
To support ongoing operations and growth expectations, the Company is increasing its Authorized Share (“AS”) count from 100 million shares to 200 million shares. Currently, more than half of the Company’s AS is tied up in reserve for its recent Promissory Note and remaining convertible debenture note. Once both notes are successfully retired, the reserve shares will be returned to treasury. However, in the interim, the current reserve commitments take away the Company’s investment leverage as the Company starts its financing relationship with Boustead Securities.
Since the acquisitions of Resonate Blends, LLC and Entourage Labs, LLC and the change in focus, the Company has retired two notes and settled for payments on another totaling nearly $600,000. This strategy has saved millions of shares from hitting the Company’s Outstanding Share count and has allowed the Company to generate equity financing for growth initiatives, while retiring the inherited debt. The Company will continue its strict discipline on share structure management to provide the best opportunity for shareholder value and increased market capitalization.
The Company’s capital needs are now focused on launching its initial products, and the Company hopes to make some exciting announcements in the coming weeks based around manufacturing, distribution and initial product launch. The early testing of the Company’s products is very encouraging and the feedback from industry leaders is beyond expectations. The Company appreciates your support and the Company looks forward to sharing more news with you in the near future.
About Resonate Blends, Inc. (OTCQB:KOAN)
Based in Calabasas, California, Resonate Blends, Inc. is a cannabis holding company centered on valued-added holistic Wellness and Lifestyle brands. The company strategy is to ignite future growth by building a purpose-driven portfolio of research organizations, innovative and emerging brands, and retail channels. The holding company’s focus is finding mutual value between product and consumer by optimizing quality, supply chain resources and financial performance. The Company offers a family of premium cannabis-based products of consistent quality based on unique formations calibrated to Resonate Blends effects system, the industry gold standard in user experience.
For more information: www.resonateblends.com
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