RDE, Inc. (NASDAQ:GIFT), a retail-catalog and mail-order house company, announced today the initiation of an at-the-market (ATM) equity offering program, through which it may sell up to $30 million worth of shares. The Delaware-incorporated company, previously known as uBid Holdings, Inc./New and Incumaker, Inc., disclosed this development in its latest 8-K filing with the Securities and Exchange Commission (SEC).
Under the terms of the ATM offering, RDE has entered into a Sales Agreement with Ascendiant Capital Markets, LLC, to facilitate the sale of its common stock. The program allows the company to sell its shares over time, at prevailing market prices, and provides flexibility in managing its capital structure.
The shares will be offered pursuant to an effective shelf registration statement, including a base prospectus, filed by RDE with the SEC on September 25, 2024, which was declared effective on October 15, 2024. A prospectus supplement related to the ATM offering was also filed on the same day as the 8-K report.
The equity offering is subject to parameters set by RDE, including the number of shares, timing, and minimum price conditions. Ascendiant Capital Markets, LLC, as the sales agent, will execute the sale of shares according to the company's instructions and within legal and regulatory boundaries.
RDE has specified that this report does not constitute an offer to sell or a solicitation to buy the shares, and the offering will only be made where legally permitted. The company has emphasized that the Sales Agreement may be suspended or terminated by either party under certain conditions, as detailed in the agreement.
In other recent news, RDE, Inc., now rebranded as Giftify, Inc., has been making significant strides in its financial and leadership strategies. The company recently announced its rebranding to Giftify, Inc., a strategic move to broaden its incentive-based offerings and facilitate future expansion. This change aligns with the company's growth and evolving market position.
Giftify, Inc. also secured a $2 million financing agreement with Spars Capital Group, a firm linked to RDE board member Elliot Bohm. This agreement is set to mature in 2025 and is secured by a lien on RDE's assets.
In leadership developments, the company has appointed Steve Handy as its new Chief Financial Officer, who holds over 20 years of financial leadership experience and has been instrumental in significant growth and IPO successes.
Giftify, Inc.'s Chief Technology Officer, Balazs Wallisch, has notably increased his ownership to 1,040,217 shares, following recent acquisitions. These are among the recent developments in the company as it continues to navigate the competitive retail landscape.
InvestingPro Insights
RDE, Inc.'s decision to initiate an ATM equity offering program comes at a challenging time for the company, as reflected in recent InvestingPro data. With a market capitalization of $42.81 million, RDE is currently operating at a loss, with a negative P/E ratio of -2.93 over the last twelve months as of Q2 2024. This financial strain is further evidenced by the company's revenue decline, with a -40.27% decrease in the last twelve months.
InvestingPro Tips highlight that RDE "suffers from weak gross profit margins" and is "not profitable over the last twelve months." These factors likely contribute to the company's decision to seek additional capital through the ATM offering. Despite these challenges, one InvestingPro Tip notes a "significant return over the last week," with data showing a 10.07% price return in the past week. This recent uptick could potentially aid the company in its capital-raising efforts.
Investors considering RDE's stock should be aware that it "does not pay a dividend to shareholders" and has experienced significant price declines, with the stock price falling -59.25% over the last three months. These insights, along with 5 additional tips available on InvestingPro, provide a comprehensive view of RDE's current financial position and market performance.
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