PORTLAND, Ore., Oct. 2, 2023 /PRNewswire/ -- Eastside Distilling, Inc. (NASDAQ: EAST) ("Eastside" or the "Company"), a consumer-focused beverage company that builds craft inspired experiential brands and high-quality artisan products around premium spirits, digital can printing, co-packing and mobile filling, recently announced the successful completion of a debt-for-equity exchange with key first and second lien debt holders. This financial transaction is significant for the Company as it has resulted in several favorable outcomes:

1. Debt Reduction: The debt-for-equity exchange has substantially reduced Eastside Distilling's outstanding debt, which will have a positive impact on the Company's financial health.
2. Improved Cash Flow: The exchange will improve the Company's near-term cash flow, providing more financial flexibility, albeit at the cost of substantial increases in back-end interest rates.
3. Debt Maturity Extension: The transaction has extended the maturities of a significant portion of the remaining debt to March 2025.
4. Nasdaq Compliance: The transaction will enable Eastside Distilling to regain compliance with the Shareholders Equity requirement for continued listing on NASDAQ.

The specific details of the transaction, including the exchange rate and the issuance of new equity, can be found in the Form 8-K filed by the Company on September 29.  In summary, the exchange involved converting outstanding debt with principal creditors totaling $6.51 million into equity at an exchange rate of $3.05 per common share equivalent. The new equity consists of common stock equivalent to 19% of the outstanding voting stock, with the balance consisting of non-voting convertible preferred stock.

Eastside Distilling's CEO, Geoffrey Gwin, commented: "I am quite happy with this transaction. It salvages our NASDAQ listing, while stabilizing our cash flow in a way that will enable us to take full advantage of the progress we've made in gaining market share in the digital printing segment within the craft beverage industry."

Investors can expect a more detailed update on these developments when Eastside Distilling reports its third-quarter results in November. This will provide an opportunity to review the Company's progress and its financial performance in greater detail.

About Eastside Distilling
Eastside Distilling, Inc. (NASDAQ: EAST) has been producing high-quality, award-winning craft spirits in Portland, Oregon, since 2008. The Company is distinguished by its highly decorated product lineup that includes Azuñia Tequilas®, Burnside Whiskeys®, Hue-Hue Coffee Rum®, and Portland Potato Vodkas®. All Eastside spirits are crafted from natural ingredients for quality and taste. Eastside's Craft Canning + Printing subsidiary is one of the Northwest's leading independent mobile canning, co-packing and digital can printing businesses.

Important Cautions Regarding Forward-Looking Statements
Certain matters discussed in this press release may be forward-looking statements that reflect our expectations or anticipations rather than historical fact. Such matters involve risks and uncertainties that may cause actual results to differ materially, including the following: changes in economic conditions, general competitive factors, the Company's ongoing financing requirements and ability to achieve financing, acceptance of the Company's products in the market, the Company's success in obtaining new customers, the Company's ability to execute its business model and strategic plans, and other risks. A detailed discussion of the most significant risks and related information can be found in the "Risk Factors" section of the Company's Annual Report on Form 10-K filed with the Securities and Exchange Commission. The Company assumes no obligation to update the cautionary information in this press release.

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SOURCE Eastside Distilling, Inc.