8-K
Laird Superfood, Inc. (LSF)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENTREPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): March 11, 2021
Laird Superfood, Inc.
(Exact name of registrant as specified in its charter)
| Delaware | 1-39537 | 81-1589788 |
|---|---|---|
| (State or other jurisdiction<br><br><br>of incorporation) | (Commission<br><br><br>File Number) | (IRS Employer<br><br><br>Identification No.) |
| 275 W. Lundgren Mill Drive, Sisters, Oregon | 97759 | |
| (Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, including area code: (888)670-6796
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|---|---|
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17<br>CFR 240.14a-12) |
| --- | --- |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| --- | --- |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
| --- | --- |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading<br><br><br>symbol | Name of each exchange<br><br><br>on which registered |
|---|---|---|
| Common Stock, par value $0.001 per share | LSF | NYSE American |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☒
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
| Item 2.02 | Results of Operations and Financial Condition. |
|---|
On March 11, 2021 Laird Superfood, Inc. issued a press release announcing its financial results for the quarter and fiscal year ended December 31, 2020. The press release is being furnished as Exhibit 99.1 hereto and is incorporated by reference herein.
The information contained in this Item 2.02, including Exhibit 99.1, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section, and shall not be incorporated by reference into any filings under the Securities Act of 1933, as amended, or the Exchange Act, except as may be expressly set forth by specific reference in such filing.
| Item 9.01 | Financial Statements and Exhibits. |
|---|---|
| (d) | Exhibits |
| --- | --- |
| Exhibit No. | Description |
| --- | --- |
| 99.1 | Press release dated March 11, 2021. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Date: March 11, 2021 | Laird Superfood, Inc. | |
|---|---|---|
| By: | /s/ Valerie Ells | |
| Name: | Valerie Ells | |
| Title: | Chief Financial Officer |
EX-99.1
Exhibit 99.1
Laird Superfood Reports Fourth Quarter & FY2020 Financial Results
FY20 Net Sales Increase Nearly 100% Year Over Year to $26.0 Million
Online Sales Contribute 56% of FY20 Net Sales, with Direct To Consumer Sales from
Lairdsuperfood.com Up 143% Year Over Year
SISTERS, Oregon – March 11, 2021 – Laird Superfood, Inc. (NYSE American: LSF) (“Laird Superfood”), today reported financial results for its fourth quarter and fiscal year ended December 31, 2020.
Fourth Quarter 2020 Highlights
| • | Net Sales increased to $7.3 million, an increase of 75% year over year. |
|---|---|
| • | Online sales contributed 61% of net sales, with lairdsuperfood.com sales growing 170% year over year, and<br>subscribers growing 184%. |
| --- | --- |
| • | Black Friday saw single-day sales grow 474% year over year.<br> |
| --- | --- |
| • | Wholesale sales contributed 37% of net sales, increasing 45% year over year, as retail door expansion reached<br>approximately 7,100 locations. |
| --- | --- |
| • | Gross profit was $1.5 million and gross margin was 20.3% compared to gross profit of $1.4 million and<br>gross margin of 34.7% in the prior year quarter. |
| --- | --- |
| • | Net loss attributable to common stockholders was $4.5 million, or $0.51 per diluted share, compared to net<br>income attributable to common stockholders of $5.3 million, or $0.96 per diluted share, in the prior year period, which included a deemed contribution from the redemption of preferred stock of $7.4 million. |
| --- | --- |
| • | The Company’s active innovation slate included seven new product introductions, including the launch of<br>Boost Coffee, the first ever coffee with Vitamin D from plant-based whole food sources, as well as Activate Prebiotic Daily Greens supplements, Harvest Pili Nuts and Dates, and Renew Protein. |
| --- | --- |
Paul Hodge Jr., Co-founder, President and Chief Executive Officer of Laird Superfood, commented, “We finished 2020 with an exceptional fourth quarter of 75% year over year revenue growth, completing a full year that saw our revenue nearly double from 2019. Thank you to our incredible team for their tireless work in a year where flexibility and creativity was key to further penetrating the multi-billion-dollar addressable markets we are pursuing. Through all the challenges presented by the pandemic, our supply chain was intact, and we successfully delivered our high quality, innovative products to a record number of customers and consumers, including over 100,000 new customers who came straight to our online platform and over 176,000 repeat orders during the year.”
“We couldn’t be more excited to enter 2021 with considerable resources – including our enhanced senior leadership team, and with over $57.2 million in cash – to execute on our growth strategy centered on maximizing market penetration in our existing product lines, developing new products that conform to both our quality and value standards and further developing our vertically integrated business model. Mahalo to our dedicated team who achieved so much this year and stayed focused on our operating goals and true to our mission to provide healthy, sustainable plant-based products.”
For the Three Months Ended December 31, 2020
| Three Months Ended December 31, | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| 2020 | 2019 | |||||||||
| % of Total | % of Total | |||||||||
| Coffee creamers | 71 | % | 81 | % | ||||||
| Hydration and beverage enhancing supplements | 14 | % | 13 | % | ||||||
| Coffee, tea, and hot chocolate products | 25 | % | 15 | % | ||||||
| Other | 4 | % | 3 | % | ||||||
| Gross sales | 114 | % | 112 | % | ||||||
| Shipping income | 0 | % | 4 | % | ||||||
| Returns and discounts | ) | (14 | %) | ) | (16 | %) | ||||
| Sales, net | 100 | % | 100 | % | ||||||
| Three Months Ended December 31, | ||||||||||
| 2020 | 2019 | |||||||||
| % of Total | % of Total | |||||||||
| Online | 61 | % | 56 | % | ||||||
| Wholesale | 37 | % | 44 | % | ||||||
| Food service | 2 | % | 0 | % | ||||||
| Sales, net | 100 | % | 100 | % |
All values are in US Dollars.
Net sales increased 75% to $7.3 million in the fourth quarter of 2020 compared to $4.2 million in the fourth quarter of 2019. **** Growth in net sales in the fourth quarter of 2020 was driven primarily by a combination of growth in online and wholesale channels, primarily caused by an increase in sales volume across product lines. Black Friday single-day sales were up 474% year-over-year which also contributed to the increase of net sales.
Gross profit was $1.5 million which is slightly higher compared to the prior year period of $1.4 million. Gross margin was 20.3% of net sales in the fourth quarter of 2020, compared to 34.7% of net sales in the prior year period. The decrease in gross margin was primarily due to elevated outbound shipping costs combined with the launch of a free shipping initiative for direct online purchases made on lairdsuperfood.com, elevated labor costs as we built out our team to support our second manufacturing line, and increased co-packing and disposal costs related to the production and distribution of our liquid creamer product line.
Operating expenses were $6.0 million compared to $3.7 million in the year ago period and reflect General and Administrative expense increases of $1.7 million, primarily related to elevated personnel costs, professional fees, and insurance expense, as well as Sales and Marketing expense increases of $621,000, primarily related to elevated marketing expenses.
Loss from operations was $4.5 million in the fourth quarter of 2020, compared to a loss of $2.2 million in the prior year period.
Net loss attributable to common stockholders was $4.5 million, or $0.51 per diluted share, in the fourth quarter of 2020, compared to net income attributable to common stockholders of $5.3 million, or $0.96 per diluted share, in the prior year period, which included a deemed contribution from the redemption of preferred stock of $7.4 million.
Valerie Ells, Chief Financial Officer, commented, “We are thrilled with our net sales performance in the fourth quarter, which furthers our conviction in the strength of our brand and the compelling addressable market opportunities in front of us. We remain confident that our business is set on a path for a strong 2021. This growth will be determined by a few key successful initiatives in the coming year including, but not limited to, timely and innovative new product introductions and a continued strong online performance. We also aim to add more wholesale doors using our liquid creamer as a means for creating these opportunities. Market share and customer growth are our major priorities and this quarter demonstrated that our authentic brand, and meeting consumers where they are across our omnichannel platform, resonates with today’s consumer seeking healthy, plant-based and sustainable products.”
For the Twelve Months Ended December 31, 2020
| Years Ended December 31, | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| 2020 | 2019 | |||||||||
| % of Total | % of Total | |||||||||
| Coffee creamers | 70 | % | 71 | % | ||||||
| Hydration and beverage enhancing supplements | 15 | % | 15 | % | ||||||
| Coffee, tea, and hot chocolate products | 23 | % | 15 | % | ||||||
| Other | 3 | % | 4 | % | ||||||
| Gross sales | 111 | % | 105 | % | ||||||
| Shipping income | 1 | % | 4 | % | ||||||
| Returns and discounts | ) | (12 | %) | ) | (9 | %) | ||||
| Sales, net | 100 | % | 100 | % | ||||||
| Years Ended December 31, | ||||||||||
| 2020 | 2019 | |||||||||
| % of Total | % of Total | |||||||||
| Online | 56 | % | 59 | % | ||||||
| Wholesale | 42 | % | 40 | % | ||||||
| Food service | 2 | % | 1 | % | ||||||
| Sales, net | 100 | % | 100 | % |
All values are in US Dollars.
Net sales increased 98% to $26.0 million for the twelve months ended December 31, 2020 compared to $13.1 million in the prior year period. **** This increase was primarily driven by a significant expansion of our customer base in both online and traditional wholesale channels.
Gross profit was $6.8 million, or 26.2% of net sales, for the twelve months ended December 31, 2020, compared to $5.1 million, or 38.8% of net sales, in the prior year period. The increase in gross profit was primarily due to sales growth. The decrease in gross margin was primarily due to elevated outbound shipping costs combined with the launch of a free shipping initiative for direct online purchases made on lairdsuperfood.com, increased co-packing costs primarily associated with our liquid creamer product line, disposal costs related to the initial production and distribution of our liquid creamer product line, and elevated labor costs.
Operating expenses were $19.7 million compared to $13.8 million in the prior year and reflect General and Administrative expense increases of $3.6 million, primarily related to the Company’s Initial Public Offering related expenses including accelerated stock option vesting, discretionary bonuses, and professional fees, as well as an asset impairment recorded during the second quarter of 2020. The change from the prior year further reflects Sales and Marketing increases of $2.1 million to $10.4 million from $8.3 million in the prior year period, primarily related to elevated advertising and marketing expenses and personnel costs.
Loss from operations was $12.9 million for the twelve months ended December 31, 2020, compared to $8.8 million in the prior year period.
Net loss attributable to common stockholders was $14.5 million, or $2.61 per diluted share, for the twelve months ended December 31, 2020 compared to $1.1 million, or $0.29 per diluted share, in the prior year period.
Balance Sheet and Cash Flow Highlights
The Company’s current assets include cash and cash equivalents of $57.2 million as of December 31, 2020. Total outstanding debt was $51,000 as of December 31, 2020. Net cash used in operating activities was $14.7 million in the twelve months ended December 31, 2020, compared to $9.4 million in the prior year period.
Capital expenditures totaled $1.1 million for the twelve months ended December 31, 2020, compared to $2.4 million in the prior year period.
2021 Outlook
The Company’s guidance assumes that there are no significant disruptions to the supply chain, or its customers or consumers, including any disruptions from adverse macroeconomic factors. In addition, the Company’s guidance reflects management’s expectation that it will continue to execute on the following core strategies: a) the optimized roll out of liquid creamer, b) expansion into additional wholesale channels, c) timely and innovative new product introductions, and d) continuation of strong online performance coupled with the optimization of DTC shipping expenses.
Given the uncertainty regarding the ultimate duration, magnitude and effects of the COVID-19 pandemic, management does not have certainty on the timing or execution of such strategies.
For the full year 2021, management feels confident the business is on a path for strong, double digit growth and expects net revenue of at least $42 million. The Company has a full year 2021 margin goal of 28-30%, which they plan to achieve via the liquid packaging update, optimizing DTC shipping, and continuing to maximize fixed cost leverage available via vertical integration.
Conference Call and Webcast Details
The Company will host a conference call and webcast at 5:00 p.m. ET today to discuss results. The live conference call can be accessed by dialing (833) 772-0381 from the U.S. or (236) 384-2050 internationally. The conference I.D. code is 5471648. Alternatively, participants may access the live webcast on the Laird Superfood Investor Relations website at https://investors.lairdsuperfood.com under “Events.”
About Laird Superfood
Laird Superfood, Inc. creates award-winning, plant-based superfood products that are both delicious and functional. The Company’s products are designed to enhance your daily ritual and keep consumers fueled naturally throughout the day. The Company was co-founded in 2015 by the world’s most prolific big-wave surfer, Laird Hamilton. Laird Superfood’s offerings are environmentally conscientious, responsibly tested, and made with real ingredients. Shop all products online at lairdsuperfood.com and join the Laird Superfood community on social media for the latest news and daily doses of inspiration.
Forward-Looking Statements
This press release and the earnings call referencing this press release contain “forward-looking” statements, as that term is defined under the federal securities laws, including but not limited to statements regarding Laird Superfood’s future financial performance, including our outlook for fiscal year 2021. These forward-looking statements are based on Laird Superfood’s current assumptions, expectations and beliefs and are subject to substantial risks, uncertainties, assumptions and changes in circumstances that may cause Laird Superfood’s actual results, performance or achievements to differ materially from those expressed or implied in any forward-looking statement. We expressly disclaim any obligation to update or alter any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.
The risks and uncertainties referred to above include, but are not limited to: (1) the effects of the current COVID-19 pandemic, or of other global outbreaks of pandemics or contagious diseases or fear of such outbreaks, including on our supply chain, the demand for our products, and on overall economic conditions and consumer confidence and spending levels; (2) our expectations regarding our revenue, expenses,
including shipping expenses, and other operating results; (3) our ability to acquire new direct and wholesale customers and successfully retain existing customers; (4) our ability to attract and retain our suppliers, distributors and co-manufacturers, and effectively manage their costs and performance; (5) our expectations regarding real or perceived quality with our products or other issues that adversely affect our brand and reputation; (6) our ability to innovate on a timely and cost-effective basis, predict changes in consumer preferences and develop successful new products, or updates to existing products, and develop innovative marketing strategies; (7) expectations regarding prices and availability of raw materials and other inputs, a substantial amount of which come from a limited number of suppliers outside the United States, including in areas which may be adversely affected by climate change; (8) effects of changes in the tastes and preferences of our consumers and consumer preferences for natural and organic food products; (9) the financial condition of, and our relationships with, our suppliers, co-manufacturers, distributors, retailers and foodservice customers, as well as the health of the foodservice industry generally; (10) effects of real or perceived quality or health issues with our products or other issues that adversely affect our brand and reputation; (11) the ability of ourselves, our suppliers and co-manufacturers to comply with food safety, environmental or other laws or regulations; (12) our plans for future investments in our business, our anticipated capital expenditures and our estimates regarding our capital requirements; (13) the costs and success of our marketing efforts, and our ability to promote our brand; (14) our reliance on our executive team and other key personnel and our ability to identify, recruit and retain skilled and general working personnel; (15) our ability to effectively manage our growth; (16) our ability to compete effectively with existing competitors and new market entrants; (17) the impact of adverse economic conditions; and (18) the growth rates of the markets in which we compete.
Contacts:
Investors:
Ashley DeSimone
Ashley.DeSimone@icrinc.com
646-677-1827
LAIRD SUPERFOOD, INC.
STATEMENTS OF OPERATIONS
| For the Three Months Ended<br>December 31, | For the Years Ended<br>December, | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2020 | 2019 | 2020 | 2019 | |||||||||
| Sales, net | $ | 7,301,270 | $ | 4,171,086 | $ | 26,006,398 | $ | 13,103,728 | ||||
| Cost of goods sold | (5,819,762 | ) | (2,722,605 | ) | (19,204,642 | ) | (8,019,094 | ) | ||||
| Gross profit | 1,481,508 | 1,448,481 | 6,801,756 | 5,084,634 | ||||||||
| General and administrative | ||||||||||||
| Salaries, wages and benefits | 880,979 | 664,925 | 3,533,478 | 2,423,005 | ||||||||
| Stock-based compensation | 835,203 | 263,388 | 1,424,803 | 700,384 | ||||||||
| Professional fees | 316,368 | 129,331 | 963,791 | 491,465 | ||||||||
| Insurance expense | 519,848 | 51,330 | 666,045 | 132,637 | ||||||||
| Office expense | 139,300 | 110,085 | 503,817 | 416,160 | ||||||||
| Occupancy | 62,151 | 61,711 | 229,303 | 157,697 | ||||||||
| Merchant service fees | 127,437 | 46,054 | 375,792 | 157,737 | ||||||||
| Netsuite subscription expense | 35,425 | 45,194 | 125,916 | 157,752 | ||||||||
| Impairment on asset held for sale | — | — | 239,734 | — | ||||||||
| Other expense | 260,737 | 119,365 | 765,600 | 564,347 | ||||||||
| Total general and administrative expenses | 3,177,448 | 1,491,383 | 8,828,279 | 5,201,184 | ||||||||
| Research and product development | ||||||||||||
| Salaries, wages and benefits | 70,318 | 83,966 | 225,305 | 216,657 | ||||||||
| Product Development Expense | 67,769 | 41,880 | 209,275 | 80,724 | ||||||||
| Stock-based compensation | 3,567 | 2,192 | 10,261 | 7,741 | ||||||||
| Other expense | 2,526 | 9,834 | 63,329 | 19,162 | ||||||||
| Total research and product development expenses | 144,180 | 137,872 | 508,170 | 324,284 | ||||||||
| Sales and marketing | ||||||||||||
| Salaries, wages and benefits | 611,868 | 679,340 | 2,669,384 | 2,609,825 | ||||||||
| Stock-based compensation | 30,570 | 106,536 | 661,026 | 207,686 | ||||||||
| Advertising | 1,116,621 | 714,854 | 4,457,213 | 3,131,332 | ||||||||
| General marketing | 696,263 | 296,880 | 1,592,180 | 1,157,920 | ||||||||
| Amazon selling fee | 168,668 | 154,361 | 743,981 | 541,009 | ||||||||
| Travel expense | 5,276 | 63,142 | 84,148 | 330,121 | ||||||||
| Other expense | 37,634 | 30,727 | 186,546 | 333,244 | ||||||||
| Total sales and marketing expenses | 2,666,900 | 2,045,840 | 10,394,478 | 8,311,137 | ||||||||
| Total expenses | 5,988,528 | 3,675,095 | 19,730,927 | 13,836,605 | ||||||||
| Operating loss | (4,507,020 | ) | (2,226,614 | ) | (12,929,171 | ) | (8,751,971 | ) | ||||
| Other income (expense) | ||||||||||||
| Interest and dividend income | 13,423 | 89,843 | 64,943 | 239,175 | ||||||||
| Gain on sale of available-for-sale securities | — | 7,664 | 13,927 | 7,664 | ||||||||
| Interest expense | — | (29,988 | ) | — | (48,816 | ) | ||||||
| Grant income | — | — | — | 50,000 | ||||||||
| Total other income | 13,423 | 67,519 | 78,870 | 248,023 | ||||||||
| Loss before income taxes | (4,493,597 | ) | (2,159,095 | ) | (12,850,301 | ) | (8,503,948 | ) | ||||
| Benefit from income taxes | — | — | ||||||||||
| Net loss | $ | (4,493,597 | ) | $ | (2,159,095 | ) | $ | (12,850,301 | ) | $ | (8,503,948 | ) |
| Add deemed contribution from the redemption of preferred stock | — | 7,448,879 | — | 7,448,879 | ||||||||
| Less deemed dividend of beneficial conversion feature | — | — | (825,366 | ) | — | |||||||
| Less deemed dividend on warrant discount | — | — | (825,366 | ) | — | |||||||
| Net loss attributable to Laird Superfood, Inc. common stockholders | $ | (4,493,597 | ) | $ | 5,289,784 | $ | (14,501,033) | $ | (1,055,069) | |||
| Net loss per share attributable to Laird Superfood, Inc common stockholders: | ||||||||||||
| Basic | $ | (0.51 | ) | $ | 1.31 | $ | (2.61 | ) | $ | (0.29 | ) | |
| Diluted | $ | (0.51 | ) | $ | 0.96 | $ | (2.61 | ) | $ | (0.29 | ) | |
| Weighted-average shares of common stock outstanding used in computing net loss per share of common<br>stock, basic | 8,876,431 | 4,045,056 | 5,546,078 | 3,668,050 | ||||||||
| Weighted-average shares of common stock outstanding used in computing net loss per share of common<br>stock, diluted | 8,876,431 | 5,532,032 | 5,546,078 | 3,668,050 |
LAIRD SUPERFOOD, INC.
STATEMENTS OF CASH FLOWS
| For the Years Ended<br>December 31, | ||||||
|---|---|---|---|---|---|---|
| 2020 | 2019 | |||||
| Cash flows from operating activities | ||||||
| Net loss | $ | (12,850,301 | ) | $ | (8,503,948 | ) |
| Adjustments to reconcile net loss to net cash from operating activities: | ||||||
| Depreciation | 474,621 | 300,561 | ||||
| Loss on disposal of equipment | — | 483 | ||||
| Stock-based compensation | 2,318,502 | 851,338 | ||||
| Noncash conversion of note payable to grant income | — | (50,000 | ) | |||
| Impairment on asset held for sale | 239,734 | — | ||||
| Gain on sale of investment securities available-for-sale | 13,927 | 7,664 | ||||
| Changes in operating assets and liabilities: | ||||||
| Accounts receivable | (454,853 | ) | (9,934 | ) | ||
| Inventory | (3,859,933 | ) | (1,253,732 | ) | ||
| Prepaid expenses and other current assets | (2,256,511 | ) | (136,669 | ) | ||
| Deferred rent | 360,786 | (1,131,393 | ) | |||
| Deposits | 30,954 | 80,750 | ||||
| Other assets | 10,151 | 2,598 | ||||
| Accounts payable | 591,213 | (60,741 | ) | |||
| Payroll liabilities | 231,823 | 307,911 | ||||
| Accrued expenses | 403,497 | 161,881 | ||||
| Net cash from operating activities | (14,746,390 | ) | (9,433,231 | ) | ||
| Cash flows from investing activities | ||||||
| Purchase of property, equipment, and software | (1,059,858 | ) | (2,423,965 | ) | ||
| Deposits on equipment to be acquired | — | (14,699 | ) | |||
| Purchase of investment securities available-for-sale | (8,171,129 | ) | (12,493,099 | ) | ||
| Proceeds from maturities of investment securities available-for-sale | 4,950,000 | 7,000,000 | ||||
| Net cash from investing activities | (4,280,987 | ) | (7,931,763 | ) | ||
| Cash flows from financing activities | ||||||
| Payments on line of credit | — | (5,000,000 | ) | |||
| Draw on line of credit | — | 5,000,000 | ||||
| Issuance of common stock | 66,110,517 | 9,698,296 | ||||
| Redemption of preferred stock | — | (7,503,195 | ) | |||
| Issuance of preferred stock | 10,000,006 | — | ||||
| Common stock issuance costs | (1,268,772 | ) | (71,102 | ) | ||
| Preferred stock issuance costs | (147,721 | ) | — | |||
| Restricted capital contribution | 298,103 | — | ||||
| Common stock issuance costs | (20,532 | ) | (1,145,968 | ) | ||
| Stock options exercised | 259,747 | 51,049 | ||||
| Net cash from financing activities | 75,231,348 | 1,029,080 | ||||
| Net change in cash, cash equivalents, and restricted cash | 56,203,971 | (16,335,914 | ) | |||
| Cash,cash equivalents, and restricted cash beginning of period | 1,004,109 | 17,340,023 | ||||
| Cash, cash equivalents, and restricted cash end of period | $ | 57,208,080 | $ | 1,004,109 | ||
| Supplemental disclosures of cash flow information | ||||||
| Interest paid | $ | — | $ | 48,816 | ||
| Supplemental disclosures of non-cash information | ||||||
| Deemed contribution from redemption of preferred stock | $ | — | $ | 7,448,879 | ||
| Conversion of preferred stock to common stock | $ | 16,575,236 | $ | — | ||
| Unrealized gain (loss) on available-for-sale securities | $ | 14,433 | $ | (226 | ) | |
| Purchases of equipment included in deposits at the beginning of the period | $ | 14,699 | $ | 4,577 | ||
| Purchases of land included in prepaids and other current assets at the beginning of the<br>period | $ | — | $ | 40,000 |
LAIRD SUPERFOOD, INC.
BALANCE SHEETS
| December 31, 2019 | |||||
| Assets | |||||
| Current assets | **** | ||||
| Cash and cash equivalents | 57,208,080 | $ | 1,004,109 | ||
| Accounts receivable, net | 839,659 | 384,806 | |||
| Investment securities available-for-sale | 8,706,844 | 5,485,209 | |||
| Inventory | 6,295,898 | 2,435,965 | |||
| Prepaid expenses and other current assets | 2,847,319 | 590,808 | |||
| Deposits | 97,674 | 143,327 | |||
| Total current assets | 75,995,474 | 10,044,224 | |||
| Noncurrent assets | |||||
| Property and equipment, net | 3,263,488 | 3,153,286 | |||
| Fixed assets held for sale | 250,000 | — | |||
| Licensing agreement - intangible | 132,100 | 132,100 | |||
| Deferred rent | 2,696,646 | 3,057,432 | |||
| Other assets | 4,992 | 15,143 | |||
| Total noncurrent assets | 6,347,226 | 6,357,961 | |||
| Total assets | 82,342,700 | $ | 16,402,185 | ||
| Liabilities, Convertible Preferred Stock and Stockholders’ Equity (Deficit) | **** | ||||
| Current liabilities | |||||
| Accounts payable | 1,315,964 | $ | 724,751 | ||
| Payroll liabilities | 722,915 | 491,092 | |||
| Accrued expenses | 704,543 | 301,046 | |||
| Total current liabilities | 2,743,422 | 1,516,889 | |||
| Long-term liabilities | |||||
| Note payable | 51,000 | 51,000 | |||
| Total long-term liabilities | 51,000 | 51,000 | |||
| Total liabilities | 2,794,422 | 1,567,889 | |||
| Commitments and contingencies (Note 9) | |||||
| Convertible preferred stock | |||||
| Preferred stock, 0.001 par value, 5,000,000 and 1,329,680 shares authorized | |||||
| as of December 31, 2020 and December 31, 2019, respectively;<br>Series A-l Preferred Stock, 0 shares authorized, issued, and outstanding | |||||
| as of December 31, 2020; 1,177,426 shares authorized, 162,340 issued and outstanding,<br>and | |||||
| 609,078 undesignated as of December 31, 2019; Series A-2 Preferred Stock 0<br>shares | |||||
| authorized, issued, and outstanding as of December 31, 2020; 152,253 shares authorized, issued,<br>and outstanding as of December 31, 2019 | 6,722,951 | ||||
| Total convertible preferred stock | — | 6,722,951 | |||
| Stockholders’ equity | |||||
| Common stock, 0.001 par value, 100,000,000 and 9,600,000 shares authorized as<br>of | |||||
| December 31 and December 31, 2019; 9,247,758 and 8,883,010 issued and outstanding at December 31,<br>2020, respectively; 4,551,950 and 4,188,558 issued and outstanding at December 31,2019, respectively | 8,893 | 4,188 | |||
| Additional paid-in capital | 111,452,346 | 27,184,250 | |||
| Accumulated other comprehensive income (loss) | 14,207 | (226 | ) | ||
| Accumulated deficit | (31,927,168 | ) | (19,076,867 | ) | |
| Total stockholders’ equity | 79,548,278 | 8,111,345 | |||
| Total liabilities, convertible preferred stock and stockholders’ equity | 82,342,700 | $ | 16,402,185 |
All values are in US Dollars.