ALPINE 4 TECHNOLOGIES RECENT UPDATE, 11/26/2019
Variable Convertible Debt Payoff, Refinancing and Settlement Agreements
Variable Convertible Debt Payoff, Refinancing and Settlement Agreements
On November 12, 2019, Alpine 4 Technologies Ltd., a Delaware corporation (the “Company”), completed a series of debt settlements, refinancings, and payoffs of existing variable convertible debt holders. As of November 22, 2019, all of the Company’s variable rate convertible debt has been paid off or has been refinanced into fixed price convertible debt.
At the time these notes were taken out, it was the only source of capital to amend a large theft event that occurred at a former subsidiary, Venture West Energy Services. Not a single note has ever fully diluted. We have actively paid down these notes, thus minimizing the number of shares to convert. Had these notes fully diluted, we could have had a dilution event of around 500mm shares.
After several months of negotiating, the Company has finalized agreements to all of the variable convertible notes that were outstanding. These resolutions took a concerted effort from all parties involved, including the noteholders to be reasonable and for that, the Company expressed its appreciation. It is important for readers of this report to understand the difference between Variable Convertible Debt (VCD) and Fixed Price Convertible Debt (FPCD). This is a very important distinction. The refinancing of the Company’s Variable Convertible Debt, with the issuance of new Fixed Price Convertible Debt, gives Alpine 4 a path to pay off these notes without the fear of large dilutive tranches of stock increasing the Company’s outstanding shares.
Through extensive negotiations, the potential conversion of 500mm shares, has now been reduced to 8-10mm shares at a FIXED price of $0.15. To account for these potential 8-10mm shares converting, the 10mm issued C shares (maturing in Q3 2022) and the allowing for a future capital raise, the Company agreed to increase its Authorized Shares with the State of Delaware and it plans on increasing its Authorized Shares by 25 million.
|Break Down of Authorized Shares|
|Current Authorized Shares||100mm|
|Renegotiated Convertible Shares||8mm-10mm|
|C Shares (maturity in Q3 2022)||10mm|
|Future Capital Raise Shares||5mm|
|Total Authorized Shares||125mm|
Alpine 4 Technologies is hot and being talked about everywhere, this is what we know so far.
About Alpine 4 Technologies: (OTCQB: ALPP)
Alpine 4 Technologies, Ltd. (ALPP) is a publicly traded conglomerate that is acquiring businesses that fit into its disruptive DSF business model of Drivers, Stabilizers, and Facilitators. At Alpine 4 we understand the nature of how technology and innovation can accentuate a business. Our focus is on how the adaptation of new technologies even in brick and mortar businesses can drive innovation. We also believe that our holdings should benefit synergistically from each other and that the ability to have collaboration across varying industries can spawn new ideas and create fertile ground for competitive advantages. This unique perspective has culminated in the development of our Blockchain enabled Enterprise Business Operating System called SPECTRUMebos.
Four principles at the core of our business are Synergy. Innovation. Drive. Excellence. At Alpine 4, we believe synergistic innovation drives excellence. By anchoring these words to our combined experience and capabilities, we can aggressively pursue opportunities within and across vertical markets. We deliver solutions that not only drive industry standards but also increase value for our shareholders.
Contact: Investor Relations, firstname.lastname@example.org
alpine 4 technologies (otcQB:alpp)Registrant’s telephone number, including area code: 480-702-2431
Below, you can find Alpine 4 Technologies Ltd. (Exact name of registrant as specified in its charter)
|(State or Other Jurisdiction of Incorporation or Organization)||(I.R.S. Employer Identification No.)|
|2525 E Arizona Biltmore Circle, Suite 237|
|(Address of Principal Executive Offices)||(Zip Code)|
Revenue per company disclosures 11/19/19
Our revenues for the nine months ended September 30, 2019, increased by $10,119,982 as compared to the nine months ended September 30, 2018. In 2019, the increase in revenue related to, $1,763,064 for APF (acquired in April 2018), and $9,561,843 for Morris (acquired in January 2019) offset by a decrease of $405,391 relating to the 6th Sense Auto and Brake Active services of ALTIA and $799,534 for QCA. The increase in revenue was driven by the acquisitions of APF and Morris. We expect our revenue to continue to grow over the remainder of the year.
News releases for alpine 4 technologies OTCBB:ALPP
OTHER INFORMATION important from 11/19/19 10Q filings
Legal Proceedings. Kevin Cannon et al. v. Alpine 4 Technologies Ltd., Jeff Hail, et al, Arizona Superior Court, Maricopa County, Cas No. CV2017-055699 . On October 4, 2017, Kevin Cannon and Michelle Hanby, individually and on behalf of It’s a Date LLC and Brake Plus NWA, Inc., filed a lawsuit in the Arizona Superior Court, Maricopa County, against the Company and several other defendants, including Jeff Hail, the Company’s Sr. Vice President. The claim against the Company alleged tortious interference of contract by the Company. The Company brought a motion to dismiss the Complaint for failure to state a claim on which relief could be granted. The Court permitted the plaintiffs to amend their complaint, which they did. The Company has filed another motion dismiss the Complaint for failure to state a claim on which relief could be granted. Following negotiations with the plaintiffs, the Company and the plaintiffs moved for dismissal of the Company. On January 28, 2019, the court dismissed all claims against the Company with prejudice. Item 2. Unregistered Sales of Equity Securities and Use of Proceeds. During the quarter ended September 30, 2019, the Company issued 32,956,827 shares of its restricted Class A common stock for note conversions and issued 200,000 shares of Class B common stock and 2,772,606 shares of Class C common stock to officer, directors and employees for services rendered.
The shares of Class A, Class B and Class C common stock were issued without registration under the 1933 Act in reliance on Section 4(a)(2) of the 1933 Act and the rules and regulations promulgated thereunder.
ALPP Company overview, highlights and company background from their press releases and SEC filings.
Alpine 4 Technologies Ltd. (“we” or the “Company”) was incorporated under the laws of the State of Delaware on April 22, 2014. Alpine 4 Technologies, Ltd (ALPP) is a publicly traded conglomerate that is acquiring businesses that fit into its disruptive DSF business model of Drivers, Stabilizers, and Facilitators. At Alpine 4, we understand the nature of how technology and innovation can accentuate a business. Our focus is on how the adaptation of new technologies even in brick and mortar businesses can drive innovation. We also believe that our holdings should benefit synergistically from each other and that the ability to have collaboration across varying industries can spawn new ideas and create fertile ground for competitive advantages. This unique perspective has culminated in the development of our Blockchain enabled Enterprise Business Operating System called SPECTRUMebos.
The Company was a holding company that owned five operating subsidiaries: ALTIA, LLC; Quality Circuit Assembly, Inc.; American Precision Fabricators, Inc.; Morris Sheet Metal, Corp; and JTD Spiral, Inc. (As discussed in more detail below, we previously had an additional subsidiary, Venture West Energy Services (formerly Horizon Well Testing, LLC). However, as of December 31, 2018, we discontinued operations on this company.)
Business Strategy What They Do:
Alexander Hamilton in his “Federalist paper #11”, said that our adventurous spirit distinguishes the commercial character of America. Hamilton knew that our freedom to be creative gave American businesses a competitive advantage over the rest of the world. I believe that Alpine 4 also exemplifies this spirit in our subsidiaries and that our greatest competitive advantage is our highly diverse business structure combined with a culture of collaboration.
It is our mandate to grow Alpine 4 into a leading, multi-faceted holding company with diverse subsidiary holdings with products and services that not only benefit from one another as a whole, but also have the benefit of independence. This type of corporate structure is about having our subsidiaries prosper through strong onsite leadership while working synergistically with other Alpine 4 holdings. The essence of our business model is based around acquiring B2B companies in a broad spectrum of industries via our acquisition strategy of DSF (Drivers, Stabilizer, Facilitator). Our DSF business model (which I will discuss more below) offers our shareholders an opportunity to own small-cap businesses that hold defensible positions in their individual market space. Further, Alpine 4’s greatest opportunity for growth exists in the smaller to middle-market operating companies with revenues between $5 to $150 million annually. In this target-rich environment, businesses generally sell at more reasonable multiples, presenting greater opportunities for operational and strategic improvements that have greater potential to enhance profit.
Driver, Stabilizer, Facilitator (DSF)
Driver: A Driver is a company that is in an emerging market or technology, that has enormous upside potential for revenue and profits, with a significant market opportunity to access. These types of acquisitions are typically small, brand new companies that need a structure to support their growth.
Stabilizer: Stabilizers are companies that have sticky customers, consistent revenue and provide solid net profit returns to Alpine 4.
Facilitators: Facilitators are our “secret sauce”. Facilitators are companies that provide a product or service that an Alpine 4 sister company can use as leverage to create a competitive advantage.
When you blend these categories into a longer-term view of the business landscape, you can then begin to see the value-driving force that makes this a truly purposeful and powerful business model. As I stated earlier, our greatest competitive advantage is our highly diversified business structure combined with a collaborative business culture, that helps drive out competition in our markets by bringing; resources, planning, technology and capacity that our competitors simply don’t have. DSF reshapes the environment each subsidiary operates in by sharing and exploiting the resources each company has, thus giving them a competitive advantage that their peers don’t have.
How We Do It:
Optimization vs. Asset Producing
The process to purchase a perspective company can be long and arduous. During our due diligence period, we are validating and determining three major points, not just the historical record of the company we are buying. Those three major points are what we call the “What is, What Should Be and What Will Be”.
|•||“The What Is” (TWI). TWI is the defining point of where a company is holistically in a myriad of metrics; Sales, Finance, Ease of Operations, Ownership and Customer Relations to name a few. Subsequently, this is usually the point where most acquirers stop in their due diligence. We look to define this position not just from a number’s standpoint, but also how does this perspective map out to a larger picture of culture and business environment.|
|•||“The What Should Be” (TWSB). TWSB is the validation point of inflection where we use many data inputs to assess if TWI is out of the norm with competitors, and does that data show the potential for improvement.|
|•||“The What Will Be” (TWWB). TWWB is how we seek to identify the net results or what we call Kinetic Profit (KP) between the TWI and TWSB. The keywords are Kinetic Profit. KP is the profit waiting to be achieved by some form of action or as we call it, the Optimization Phase of acquiring a new company.|
Optimization: During the Optimization Phase, we seek to root up employees with in-depth training on various topics. Usually, these training sessions include; Profit and Expense Control, Production Planning, Breakeven Analysis and Profit Engineering to name a few. But the end game is to guide these companies to: become net profitable with the new debt burden placed on them post-acquisition, mitigate the loss of sales due to acquisition attrition (we typically plan on 10% of our customers leaving simply due to old ownership not being involved in the company any longer), potential replacement of employees that no longer wish to be employed post-acquisition and other ancillary issues that may arise. The Optimization Phase usually takes 12-18 months post-acquisition and a company can fall back into Optimization if it is stagnant or regresses in its training.
Asset Producing: Asset Producing is the ideal point where we want our subsidiaries to be. To become Asset Producing, subsidiary management must have completed prescribed training formats, proven they understand the KPI’s that run their respective departments and finally, the subsidiaries they manage must have posted a net profit for 3 consecutive months. Going Concern
The accompanying financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has incurred losses since inception and had accumulated a deficit of $29,774,346 as of September 30, 2019. The Company requires capital for its contemplated operational and marketing activities. The Company’s ability to raise additional capital through the future issuances of common stock is unknown. The obtainment of additional financing, the successful development of the Company’s contemplated plan of operations, and its transition, ultimately, to the attainment of profitable operations are necessary for the Company to continue operations. The ability to successfully resolve these factors raise substantial doubt about the Company’s ability to continue as a going concern. The financial statements of the Company do not include any adjustments that may result from the outcome of these aforementioned uncertainties. Our net operating losses increase the difficulty in meeting such goals and there can be no assurances that such methods will prove successful. Our financial statements contain additional note disclosures describing the management’s assessment of our ability to continue as a going concern.
The management of Alpine 4 understands basis for including a going concern in this filing. However, the management points out that over the past 4 years, Alpine 4 has consistently been able to operate under the current working capital environment and the going concern is nothing new or a recent event. In order to mitigate the risk related with the going concern uncertainty, the Company has a three-fold plan to resolve these risks. First, the acquisitions of QCA, APF and Morris have allowed for an increased level of cash flow to the Company. Second, the Company is considering other potential acquisition targets that, like QCA and Morris, should increase income and cash flow to the Company. Third, the Company is exploring debt options that can supplement on going cash needs.
Our revenues for the three months ended September 30, 2019, increased by $2,745,979 as compared to the three months ended September 30, 2018. In 2019, the increase in revenue related to, $3,820,472 for Morris (acquired in January 2019) offset by a decrease of $233,794 for APF; $183,234 relating to the 6th Sense Auto and Brake Active services of ALTIA and $657,465 for QCA. The increase in revenue was driven by the acquisition of Morris. We expect our revenue to continue to grow over the remainder of the year.
Keep your eye out for more press releases and the upcoming Shareholders meeting on 11/23/19
ALPINE 4 TECHNOLOGIES LTD.
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD NOVEMBER 23, 2019
The 2019 Annual Meeting of Stockholders of Alpine 4 Technologies Ltd., a Delaware corporation will be held on November 23, 2019, at 1:00 p.m. Mountain Standard Time at ASU’s SkySong Innovation Center located at 1475 N Scottsdale Rd. Scottsdale, AZ 85257, for the following purposes, as more fully described in the proxy statement
|1||To elect four Directors: Kent B. Wilson, Scott Edwards, Charles Winters, and Ian Kantrowitz, each to serve until the next annual meeting of the shareholders or until a successor has been elected and qualified;|
|2||To ratify the appointment of Malone Bailey LLP to serve as our independent registered public accountants for the fiscal year ending December 31, 2019; and|
|3||To transact such other business as may properly come before the Annual Meeting, or any postponement(s) or adjournment(s) thereof.|
All stockholders of record at the close of business on October 14, 2019 (the “Record Date”), are entitled to notice of and to vote at the Annual Meeting and any adjournment(s) or postponement(s) thereof. The Company’s Board of Directors (the “Board”) recommends that you vote in favor of the foregoing items of business, which are more fully described in the Proxy Statement accompanying this Notice. We cordially invite all stockholders to attend the Annual Meeting in person. Whether or not you plan to attend, it is important that your shares are represented and voted at the Annual Meeting. As an alternative to voting in person at the Annual Meeting, you can vote your shares electronically over the Internet or by telephone, or if you receive a proxy card or a form of voting instructions in the mail, by mailing the completed proxy card or form of voting instructions.
Major Customers The Company had three customers that made up 21%, 16% and 13%, respectively, of accounts receivable as of September 30, 2019. The Company had two customers that made up 29 % and 27%, respectively, of accounts receivable as of December 31, 2018. For the nine months ended September 30, 2019, the Company had two customers that made up 14% and 11%, respectively, of total revenues.
For the nine months ended September 30, 2018, the Company had one customer that made up 23% of total revenues. Accounts Receivable The Company maintains reserves for potential credit losses on accounts receivable. Management reviews the composition of accounts receivable and analyzes historical bad debts, customer concentrations, customer credit worthiness, current economic trends and changes in customer payment patterns to evaluate the adequacy of these reserves. Reserves are recorded primarily on a specific identification basis.
As of November 20, 2018, the issuer had 25,537,107 shares of its Class A common stock issued and outstanding and 5,000,000 shares of its Class B common stock issued and outstanding.
As of May 20, 2019, the issuer had 29,310,056 shares of its Class A common stock issued and outstanding and 5,000,000 shares of its Class B common stock issued and outstanding.
AS As of August 19, 2019, the issuer had 95,170,161 shares of its Class A common stock issued and outstanding and 5,000,000 shares of its Class B common stock issued and outstanding.
As of August 16, 2019, the issuer had 75,252,093 shares of its Class A common stock issued and outstanding and 5,000,000 shares of its Class B common stock issued and outstanding.
As of November 18, 2019, the issuer had 99,770,161 shares of its Class A common stock issued and outstanding; 5,000,000 shares of its Class B common stock issued and outstanding and 9,910,200 shares of its Class C common stock issued and outstanding.
Authorized Shares100,000,000 11/01/2019.
KEEPING AN EYE ON ALPINE 4 TECHNOLOGIES