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Long Blockchain warded off financial crunch last year, filing says

The stock of Long Island Iced Tea skyrocketed

The stock of Long Island Iced Tea skyrocketed in December after the company adopted the Long Blockchain name Credit: Long Block Chain Corp.

Farmingdale-based Long Island Iced Tea Corp. traded future receipts from its affiliated iced tea business to ward off a cash crunch in late 2017, according to a government filing Friday.

The month before it changed its name to Long Blockchain Corp. and refocused its business, the company sold future receipts worth almost $1 million for about $750,000 to Uniondale-based Radium2 Capital Inc., according to an agreement dated November 27, 2017.

The agreement was signed by Philip Thomas, who was Long Island Iced Tea’s chief executive.

The company closed 2017 with a cash position of $370,947, down from $1.2 million at the end of 2016.

In December, the company announced it was changing its name to Long Blockchain Corp. and going into businesses related to cryptocurrencies.

In February, current CEO Shamyl Malik, a Wall Street veteran, replaced Thomas, and the company said it planned to spin off its ready-to-drink iced tea business to shareholders.

The company’s stock more than doubled following the December announcement, hitting an intraday high of $9.49. In recent weeks, the stock has fallen amid a decline in the value of cryptocurrencies such as bitcoin.

Cryptocurrencies are digital currencies that use encryption to verify the creation and transfer of funds. They typically circulate beyond the control of a central bank.

Blockchain, a technology used by cryptocurrencies, is a digital ledger distributed among many computers. Companies are seeking to apply blockchain technology to logistics, stock trading, real estate transactions and other uses.

Long Blockchain shares lost 3.6 percent to close Friday at 69 cents.

In 2017, the company’s net loss widened to $15.2 million on sales of $4.4 million. That compared to a net loss of $10.4 million on sales of $4.6 million in 2016.

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