KOTA Longboards Business Plan 2018 PDF

JOIN OUR WORLD KOTA LONGBOARDS BUSINESS PLAN 2018  Table of Contents | KOTA Business Plan 2018 Executive Summary 3-4...

JOIN OUR WORLD KOTA LONGBOARDS BUSINESS PLAN 2018  Table of Contents | KOTA Business Plan 2018 Executive Summary 3-4 Industry Overview 5-6 Longboards Past to Present 5 Evolution of the Longboard 5 Traditional Market 6 Mainstream Market 6 Brand Overview & Strategy 8-9 KOTA Logo 8 Brand Strategy 9 KOTA Product Differentiation 10-13 KOTA Longboard Engineering 10 KOTA Design & Styling 10 KOTA Spitfire Mk V Electric 12 Demographic Analysis 13 Innovation 14 Executive Team 15-16 Organizational Chart & Management Profiles 15 Sales Channels, Marketing & Distribution 17-21 Specialty Retail 17 Corporate Partner Program (CoBrands) 18 Direct Sales 21 Marketing Spend 22-24 Social Media 22 Tradeshows 22 Domestic Travel 23 Traditional Media 23 Local Events, Levitt Pavilion & the KOTA Escadrille 24 Recognition & Reality TV 25-26 Chase Mission Main Street Grant 25 The Profit 26 Community Outreach & CSR 27-28 Carve It For Life! 27 Environmental Stewardship 28 APPENDICES Appendix A: KOTA Pricing & Terms 30-31 Appendix B: KOTA WeFunder 32-34 KOTA Longboards | Confidential And Proprietary Information PAGE 2  PREPARE for FLIGHT Whether you’re new to KOTA or you’ve been around the company for awhile, you know there is something VERY SPECIAL about this BRAND. Executive Summary: KOTA (KNIGHTS OF THE AIR) KOTA is an emerging lifestyle brand on a fast-growth trajectory. Within these pages we will share the origins, direction and future of our product lines, our brand and the people that make KOTA an inspiring company. KOTA is an acronym for ‘Knights of the Air’, the moniker given to the world’s first fighter pilots during WW I. Knights of the Air is synonymous with the concepts of chivalry, honor and esprit de corps - even amongst adversaries. The essence of the KOTA brand and the company itself is to embody these qualities, holding ourselves to a higher standard in all that we do. KOTA operates on principles that guide us daily as well as in the longer-term. These principles are expressed in our brand positioning: Heritage KOTA, Knights of the Air, is made rich with heritage, history and context even though the company is young. Quality KOTA is uniformly obsessed with quality and detail. This drives everything we do. Authenticity KOTA lives by what it stands for. We back up the heritage of the brand with our backgrounds, experience and conduct in the marketplace. Premium KOTA is a premium brand, producing premium products - no matter what product has the KOTA brand on it. Connection KOTA connects with a diverse, broad and dynamic demographic embodying enthusiasm, energy, confidence, fellowship, empowerment, integrity and compassion. Emotion KOTA strives for an emotional relationship with its audience - built upon adventure, fun, the outdoors and family. We inspire confidence and optimism. At KOTA we don’t ask “Why”, but “Why not?”. Lifestyle The KOTA lifestyle is one of participation, action, learning, sharing, and of course, honor, courage, freedom, integrity, truth and esprit de corps. KOTA Longboards | Confidential And Proprietary Information PAGE 3 KOTA was founded on the belief that given an innovative, high value, thoughtfully engineered product and compelling brand, the activity of longboarding was ripe for adoption as a mainstream action sports activity. Today, KOTA’s growing family of clients is a collection of action sports/ active lifestyle participants spanning 5 decades in age (20s through 60s). This demographic is growing, with a consistent hunger for new activities to engage in and disposable income available for lifestyle purchases. Our clients tell us that what attracts them to KOTA is the company’s ‘vibe’. Whether it’s the empowerment they feel by adopting longboarding as a lifestyle activity, our historic aviation heritage, core values and brand authenticity, the quality and styling of our products, or the community outreach that’s coded into the KOTA DNA, they all say the same thing - It’s about the KOTA BRAND! KOTA’s longboards are engineered so riders can control their speed and direction, opening up longboarding to a new world of potential riders. Innovations such as our proprietary, smooth, clear gloss KOTAgrip finish set us apart from the traditional skateboard community. KOTAgrip eliminates the need for grip tape allowing us to move the primary art surface to the board’s top surface - a feature unique to KOTA in the skate industry. KOTA’s elevated styling and performance breaks away from the stereotypical reckless, rebellious, teenage ‘skateboard culture’. As a result, KOTA appeals to a broad demographic, well outside of the marketplace targeted by other longboard manufacturers. In general, our clientele is made up of participants in activities such as skiing, surfing, stand up paddle, road and mountain biking, kayaking, etc. As the company matures, KOTA is evolving into an ‘aspirational’ brand in the active lifestyle market. Brands such as Patagonia, The North Face, Vans and Burton have created consumer connections similar to what we believe can exist over time with the KOTA brand. What really inspires us is YOU because we believe you are all pilots, race car drivers, adventurers and explorers. KOTA Longboards | Confidential And Proprietary Information PAGE 4 Industry Overview: Longboards Past to Present In the family of board sports, skateboarding was the first major departure from surfing. In the 1960’s surfers used roller-skate hardware and short pieces of lumber to create rolling boards for coasting the smooth new streetscapes of Southern California, and riding the slopes of dry swimming pools and drainage canals. The introduction of ‘kicktail’ boards with turned-up ends in 1969 allowed riders to leverage their boards into the air and skateboard tricks began to gain popularity. The expansion of board sports with the rising popularity of snowboarding around the same time helped normalize skateboarding. Longboard skateboards had their genesis among Hawaiian surfers who wanted a carving and traversing or “land surfing” experience. With a smoother, more stable ride, longboards gained popularity in the early 2000’s as consumers recognized their adaptability for travel from point A to point B. Evolution of the Longboard While there is no specific length at which a short board becomes a longboard, the differentiation between the two is generally in how the board is used. Longboards departed from swimming pools and skate parks into cruising and land surfing with an emphasis on recreation rather than tricks. Early on, in an attempt to define the sport, the skateboard industry decided to promote an extreme image of longboarding with downhilling and sliding. This image catered to the Southern California teenage male but had very limited demographic appeal and has cast a stigma on longboarding as being well outside of the mainstream. In recent years, longboarding has been most commonly seen on college campuses in a commuter application. Ridership is overwhelmingly male fitting with the Surf Industry Manufacturers Association (SIMA) longboard demographic of males (93%) ages 9 to 24. The longboard has now been around long enough where we see post-college ridership increasing. Young professionals in coat and tie are frequently seen commuting to work on longboards through urban streets from New York to LA, Milan (pictured at right) to Paris and Berlin.1 The longboard industry has been slow to recognize this expansion of ridership beyond their traditional demographic. Tastes, aspirations and cultural affiliations change dramatically post-college. Consumer focus on value over price, product sophistication and innovation, and timeless styling move them away from the skate shop culture, styles and trends. 1 See Skateboards for Working and Working Out, NY Times, August 2013: www.nytimes.com/2013/08/23/nyregion/skateboards-for- work-and-working-out KOTA Longboards | Confidential And Proprietary Information PAGE 5 Traditional Market There are a number of North American longboard manufacturers participating in the market. According to surveys and our own analysis of specialty retailers, Sector 9 (now owned by Billabong) is the top selling brand nationally. A handful of brands, such as Arbor (now manufactured by Sector 9 in China), Loaded, Land Yachtz, etc. are vying for second tier presence. Regional participants trend toward the coasts and mountain regions. For example, Denver-based Never Summer Industries is a snowboard company that manufactures skateboards to offset the winter seasonality of their core business. Never Summer has significant local market share in the Rocky Mountain region. Sources with knowledge of Never Summer indicate the company sells approximately 10,000 longboards annually. As evidenced by their marketing material, Never Summer’s target market is their loyal snowboard customer and the company is heavily associated with winter mountain activity. This plays well along the Front Range but has less relevance in warmer climates. Most large and small longboard companies offer textiles and other soft goods, however, few vertically integrate into components (i.e., wheels, trucks, etc). The traditional market is characterized by new entrants gaining rapid popularity and staying atop the market for a couple of years before blending back into the crowd. Beyond Sector 9 none of the brands appear capable of sustained differentiation with consumers or retailers in the 9-24 year old market. Mainstream Markets The mainstream markets that KOTA appeals to are the “action sports” and “active lifestyle” markets. This includes the ‘surf inspired’, ski and mountain lifestyle, fitness, adventure and recreation consumer. The 2017 SIMA Consumer Insights Report quantified the ‘surf inspired’ market at 66.5 million adults in the U.S. alone. That’s nearly 1/3 of the U.S. adult population. Trends within this marketplace indicated (a) diversity in age, gender and race, (b) women represent 56% of the spend in this sector, (c) while 60% of buying is through brick and mortar, the consumer is trending toward online purchasing, and (d) the consumer is motivated by value and quality over price. This represents $26.5 billion annually solely in the surf lifestyle market. KOTA products and brand appeal to the value and quality oriented buyer reflected by the SIMA Surf Market report. KOTA reaches that consumer via social media, online, select CoBrands and action sports retailers such as surf shops, bike shops, ski and snowboard shops, etc. The KOTA Longboards | Confidential And Proprietary Information PAGE 6 consumer dollars we compete for would be the same deployed for products such as an action sports camera, performance sunglasses, hydration pack, stand up paddleboard, skis, beach cruiser bicycle or similar products - even high-end brand apparel and footwear. KOTA products have lower appeal to the 9 to 24 year old male primarily due to price. Our product is simply not what they’re looking for as a price sensitive consumer. We are in constant observation of a long list of longboard makers who sell primarily online or through skate shops catering to the teenage male, however, we’re not directly competing with most of them. SIMA is the primary source of information on the Surf/Skate market’s size and wellbeing. Data extrapolated from SIMA’s Specialty Retail Distribution Study for 2010 implied a U.S. longboard skateboard market size (hard good only) of over $2 billion annually. 70% of skateboarders ride longboards (as opposed to or in addition to short boards) resulting in an average U.S. longboard ridership of 7-8 million. SIMA’s 2012 report stated, “...one overriding theme remained consistent: the surf/skate industry is a lifestyle driven by passion, not a passing trend. Dedicated surfers and skaters loyal to these sports continue to purchase at specialty retail, even in tougher [economic] times.” KOTA Longboards | Confidential And Proprietary Information PAGE 7 KOTA Brand Overview KOTA is a brand that has meaning, context and authenticity. Honor, courage, truth - the ideals that Knights of the Air embodies are universal. The majority of our clients don’t perceive KOTA as a military brand despite our fighter aviation heritage. Appeal for KOTA is also independent from any affinity for aviation, the military or interest in history. Our clientele resonates with the concepts that the KOTA brand embodies. Our clients, particularly women, tell us that they feel empowered by the KOTA brand because they never thought they’d be riding a longboard. It makes them feel more youthful, energetic, stylish and trend setting. More importantly, they feel others perceive them to represent these characteristics. However, their attraction to KOTA goes beyond the product. They desire to be associated with the qualities and ideals that Knights of the Air stands for in addition to the community outreach that KOTA participates in. The KOTA Logo From the beginning we recognized that KOTA’s target demographic is attracted to product and brand characteristics such as timeless styling, quality, authenticity and dependability. We sum that up in the term “timeless vintage”. Given the rich historical context of our brand name we wanted a classic look that embodied these qualities. Our inspiration for the KOTA Longboards logo came from an exploration of vintage bicycle head badges.2 Head badges began as a way for bicycle manufacturers to identify and differentiate their product lines. Over time, however, these brand badges were raised to a high art - particularly in the United States. In the mind of the consumer, the head badge became representative of the quality and artistry of the product. With an imaginative badge, you weren’t merely riding a bicycle any longer, you were piloting a Zephyr or a Whirlwind, or commanding a Silver King. You were a cowboy, a space ranger - or a Knight of the Air. The KOTA logo is an inspired, imaginative head badge design. Colorful, energetic and fluid. Our branding and product styling are centered on presenting a positive, clean and sophisticated image recalling the artistry, courage and competitive spirit of American culture. 2 See Badges Of Distinction, Bicycling Magazine, January 2012: www.bicycling.com/culture/fashion/badges-distinction KOTA Longboards | Confidential And Proprietary Information PAGE 8 Every KOTA longboard features a metal medallion inset into the top of the board bringing a tactile quality to our brand. KOTA Apparel Logo In 2015 we created the KOTA “Propwash” logo as we began to extend product development into apparel and accessories. The Propwash concept was derived from the stylized propeller rotation in our original logo. This logo’s cleanliness of design and ease of recognition better translates into applications where embroidery, color or size necessitates simplicity. Our clientele, including women, increasingly tell us they’d like to see Knights of the Air spelled out. The meaning of Knights of the Air is compelling to them and they want to wear it (literally) as a badge of honor and conversation starter. This is further evidence that the ideals associated with the KOTA brand resonate with the lifestyle consumer. KOTA Brand Strategy Today, KOTA’s revenue is generated almost exclusively from longboard skateboard sales, however, we don’t view KOTA as solely a skateboard company. Our clientele have made it very clear that the KOTA brand - it’s history, it’s authenticity, the values it stands for and KOTA’s community outreach - is what draws them to KOTA. Over time, we see KOTA emerging as an aspirational, active lifestyle brand. Our near-term brand strategy is to maintain the longboard as our signature hard good while expanding our line of KOTA branded products and accessories (skate tools, wall hangers, t-shirts, ball caps, water bottles, etc.). Feedback from our followers is that they want product in addition to the longboard that is an expression of the KOTA brand. Expanding our branded product lines gives the consumer a multiple products at a variety of price points to choose from. Our intention is to drive KOTA to sustained profitability on our longboard and branded product lines. Once the company achieves sustained profitability, our goal is to further establish the KOTA brand with a strategic move into apparel in a broad lifestyle category. The intent is to offer the active lifestyle/action sports market a full assortment of hard good, logo product, apparel and accessories. This would broaden our brand appeal to retailers and consumers that are drawn to the KOTA brand but may have a stronger affinity for soft good over hard good. At this time the earliest KOTA anticipates any launch an apparel line would be Fall 2020. This would require samples to be completed and available to sales reps by November 2019. We understand the importance of launching a meaningful apparel line and will delay this move as needed to maximize our probability of success. This business plan will focus on driving KOTA to profitability with KOTA longboards and branded product alone. KOTA Longboards | Confidential And Proprietary Information PAGE 9 KOTA Product Differentiation KOTA Longboard Engineering KOTA longboards are pressed into a complex curve known as a ‘Hyperbolic Saddle’. This cambered shape used in all KOTA boards is intentionally engineered to provide rider control. Camber provides three main attributes that enhance rider experience: 1) Stepping on the board and flattening out the camber imparts tension and compression (energy) in the core of the board. This energy strengthens the board making it durable as well as flexible. 2) Similar to a high-performance alpine ski, the energy in the core of the board can be used to control speed. With subtle alteration of the rider’s center of gravity, this energy can be used to either bleed energy (speed) through a turn or accelerate. 3) Camber also acts as a shock absorber giving the rider an exceptionally smooth ride. KOTA Design and Styling KOTA Longboards’ Premium Line currently fields four unique 44” shapes, each named after an iconic airplane. The four Premium designs are the SPAD XIII, Nieuport 17, Handley Page and Sopwith Pup. KOTA’s new Macchi line is designated by length (40”) as the Macchi M.40. All of KOTA stock boards are 7-ply Hard Rock Maple pressed in the same mold (i.e., they all have the same concave/camber combination), yet each is designed to have specific performance attributes. In the Premium Line, nose shape is a primary factor in the turning capability of the deck. The width of the wood at the back truck determines how flexible the deck will be. The Macchi has a shorter wheelbase so turns more aggressively. Camber is the engineered curvature of your The Concave surface on top of your KOTA longboard. It’s the mechanism that allows KOTA longboard gives you added you to control your ride! turning performance while you carve! KOTA Longboards | Confidential And Proprietary Information PAGE 10 Board shapes in the Premium Line have recommended rider weight limits (190 lbs for the SPAD, 230 lbs for the Nieuport, and 250 lbs for the Handley and Sopwith). For a small upcharge, KOTA will press an 8-ply that will accommodate weights over 250 for all board shapes. While still a small percentage of sales, we’ve seen an increase in 8-ply orders over the past 18 months. What differentiates KOTA in the longboard market is a combination of: a) KOTAgrip Our proprietary KOTAgrip finish eliminates the need for grip tape. KOTAgrip allows us to move the primary art surface to the top of the board - a characteristic is completely unique to KOTA in the skateboard market. b) HYPERBOLIC SADDLE Our cambered construction allows the rider increased control of their speed, direction and ride, a feature that appeals to a broader, older demographic; c) VALUE & QUALITY A price point that is competitive within the longboard marketplace (please see Appendix A for a market pricing analysis) and even more so in the active lifestyle specialty gear market where value and quality are the primary purchase motives. d) KOTA BRAND The KOTA brand and company culture attracts the mainstream action sports participant, inspiring them to adopt longboarding as part of their active lifestyle. KOTA Longboards | Confidential And Proprietary Information PAGE 11 KOTA Spitfire Mk V Electric eBoard Market: The modern motorized (electric) longboard hit the mainstream in 2012 with ZBoard’s Kickstarter campaign which oversubscribed to the tune of $1 million. Today, Boosted, Evolve and Inboard are among the top selling brands. Most companies fielding electric boards are essentially battery technology companies. Their focus is on developing and improving the powerplant (battery) and drive train (motors and disc or belt drives). They’ve refined skateboard propulsion but fall short of offering a comprehensive, high performance ride. In essence, they have the Ferrari engine but lack the suspension, chassis and body that make a Ferrari a Ferrari. KOTA Market Opportunity: Performance specifications for the top selling brands are beginning to plateau and merge, leaving less and less differentiation between products. In the near future there will be virtually no difference in powerplant performance between top tier eBoards. When this happens, we believe the market will move toward board performance, quality, style and brand, playing directly into KOTA’s market strengths. The primary performance specifications for eBoards are distance (i.e., battery capacity), re-charge time and top speed.3 The KOTA Spitfire Mk V has an empirically tested range of 15-17 miles with a top speed between 22 and 25 mph. 95% charge will occur in less than 2 hours with full charge after 4 hours. KOTA has the ability to source best-in-class components but combine them with a superior performance board while giving the consumer a choice of board shapes and designs. No other eBoard company can do this today. In addition, KOTA can offer the Spitfire Mk V at a materially lower price point than Boosted, Evolve or Inboard. 3 We’re less concerned with speed as current component systems are already achieving speeds that are becoming a safety issue. KOTA Longboards | Confidential And Proprietary Information PAGE 12 Demographic Analysis Men: Men’s purchase motives seem to be dominated by quality, style and performance. European men tend to push technology higher up their purchase matrix than American men. Feedback from distributors indicates a hunger along the Pacific Rim for any U.S. manufactured specialty product. To date, men have been primarily attracted to the Nieuport 17. KOTA design styles featuring aviation, surf and race car themes are popular with men. Our U.S. Flag, Flying Tigers and Dewey Weber designs are currently most popular with men. Women: Women have a more complex and sophisticated purchase decision matrix than men. KOTA offers both a look and feel that increasingly appeal to women. Traditional longboard manufacturers have overwhelmingly marketed to teenage males. Women have generally been excluded from longboarding as an active lifestyle activity. We consistently hear from women that they feel alienated by the culture and atmosphere of the local skate shop, and the styles promoted by our competitors are unappealing. These are the primary factors that keep women from adopting longboarding. Women tell us that KOTA offers them a comfortable and appealing entry into longboarding. They feel ‘welcome and included’ in the KOTA culture. Approximately 40% of KOTA sales are to women. At KOTA, we actively market to and design product that we believe will appeal to women. We’ve found that women will be attracted to the aesthetic of KOTA longboards. Drawn in by our styling, women see KOTA content (still and video) of women just like themselves riding safely, in a community of like-minded women. Relating to the women in this content, they begin to imagine themselves longboarding. This leads them to exploring and understanding the KOTA brand. Appeal for the brand leads to purchase and adopting longboarding as part of their active lifestyle. KOTA’s demographic overlaps the Active Lifestyle market, spanning several decades in age from the mid-20s to 60s. The heart of our demographic is age 35-55, 40% women. KOTA clients select board shape based upon shape aesthetic, performance & rider weight. Our sales reflect the depicted distribution of board shapes. KOTA Longboards | Confidential And Proprietary Information PAGE 13 Innovation At the appropriate time and with available capital, we intend to develop our own KOTA components, vertically integrating along our hard goods lines. KOTA Simulator (patent pending): The KOTA Simulator is a unique and valuable static trainer which recreates the turning motion and flex of the longboard without rolling. Use of the KOTA Simulator has proven to be influential in encouraging people of all ages who may be skeptical about getting on a longboard to become enthusiastic about riding. On several occasions we’ve helped people (particularly women) who initially scoffed at the idea of getting on a skateboard learn to ride and even purchase a KOTA longboard after spending time on the KOTA Simulator. The KOTA Simulator enables newcomers to the sport to feel our KOTAgrip finish, and learn foot position, weight and balance, and control of the board without ever rolling an inch. We sell the KOTA Simulator to retailers and Co-Brand clients as an interactive point-of- purchase tool. KOTA Clear Deck: KOTA has developed and tested a technology that is unique in the longboard industry. Borrowing from ski manufacturing technology, we have inset metal screw receivers into the bottom of the board, eliminating the need to drill holes through the deck to hold trucks in place. We call this innovation Clear Deck. Clear Deck enhances the stability of the trucks and prevents cracks from forming around truck holes, amplifying the aesthetic of our longboards. KOTA Clear Deck and KOTAgrip are an exclusive combination found only on KOTA longboards. Truck System: KOTA has a conceptual design for a truck binding system employing technology currently used in road and mountain bike pedal/shoe bindings. This binding system allows for easy exchange of trucks from one deck to another or switching from utility trucks to high performance trucks with ease. The binding system will also feature an integrated anti-theft system, powered RFID technology and adjustable torsion limiter to eliminate wheel bite. KOTA Longboards | Confidential And Proprietary Information PAGE 14 Executive Team Organizational Chart: Mike Maloney (Founder, President/CEO): Mike is a former Navy F-14 pilot and graduate of the U.S. Navy Fighter Weapons School (TOPGUN). He has career-long experience in mission critical leadership, planning and execution. Mike and Nikki founded KOTA Longboards in May 2012 following several months of market analysis and preparation. Mike is the former President/CEO of Novinda Corp., a Denver-based clean coal technology company spun out from CH2M HILL. Previously, Mike established and managed CH2M HILL’s technology commercialization and investment program where he led many diverse technology efforts, building product and process technologies into functioning businesses. Mike’s expertise bridges both early stage product commercialization and growth opportunities for product adoption in new and emerging markets. He is thoroughly experienced in developing revenue models for emerging products and structuring investment partnerships. Mike holds a BS Mechanical Engineering from the University of Colorado and a MS Finance from the University of Denver. He is an avid downhill skier, roadbiker, woodworker and family man, riding KOTA longboards daily with his kids. Nikki Maloney (Founder, VP Ops, Office Manager): Nikki is a veteran of the Denver Mayor’s Office of Economic Development and International Trade (MOED&IT) where she was an economic development specialist focusing on startups, the high tech sector, and development in Downtown Denver, Cherry Creek, Lowry and the Denver Tech Center. Prior to MOED&IT, Nikki worked directly for the President & CEO of CH2M HILL in public affairs. She established a statewide trade organization for the engineering community, worked with the Clinton White House on environmental technology conferences and did PR, marketing and business development for the CEO. Nikki has also been active in her community spearheading many change efforts within Denver Public Schools. She also established and served on the boards of Flight for Life, the StEPP Foundation, Safe Routes to School, Collaborative School Committees, etc. Nikki holds a BA in Public Policy and History from the University of Denver. KOTA Longboards | Confidential And Proprietary Information PAGE 15  Wick Hardenbergh (Production Manager): Wick attended the Ohio State University, majoring in World Economy and Business in the International Studies program. Before joining the KOTA team, he manufactured components for GE turbines at Indy Honeycomb in Northern Kentucky. Wick’s been an avid longboarder for twelve years and strives to integrate his passion into his work to further the growth of the sport. Sean McGrane (Marketing Director): Sean learned and practiced foundational marketing/advertising skills as a member of the U.S. Army’s Civil Affairs and Psychological Operations Command. He further honed these tools in various tactical and strategic leadership positions in the civilian world across a variety of verticals including retail, construction, health care and non-profit. Sean has assisted with manufacturing and marketing initiatives at KOTA and helped create KOTA’s 501(c)3, Carve It For Life!. Rick Rusch (Apparel, Accessories & Merchandising Advisor): Rick is a career-long retail merchant and marketer. He has held senior executive positions with Lands’ End and Gander Mountain. In addition he has extensive retail experience with outdoor specialty retailers REI and Eddie Bauer. Rick runs his own consulting firm, The Brand Guides LLC, a branding, marketing and sales consulting organization. Rick was responsible for the initial build-out of the KOTA website and developing key relationships with vendors and distributors. He currently advises KOTA on merchandising strategy awaiting any potential move by KOTA into the apparel market. KOTA Longboards | Confidential And Proprietary Information PAGE 16 Sales Channels, Marketing & Distribution The KOTA brand is growing in resonance with consumers. Active lifestyle consumers in our target demographic have a consistent and positive reaction to our brand. We’re confident that we’ll get the same, consistent response to KOTA as we expand awareness of our brand and product lines. We distribute through three distribution channels, Specialty Retail, CoBrands and Direct. Consumer purchase motives and buying habits are constantly evolving. Throughout 2016 we gained valuable insight into which sales channels can be rapidly scaled. As a result, we’ve adopted a more fluid strategy for gaining market share as we understand what is motivating consumers to purchase within the KOTA brand. We find the consumer trending in the following directions based upon market reports and interaction with retailers: PRODUCT After more than a decade of consumer focus on price, consumer behavior is now moving toward quality, value and brand characteristics. KOTA fulfills all of these attributes so this trend is positive for our product lines. BRAND The consumer is hungry for new, exciting, authentic and meaningful brands. While iconic brands such as Patagonia remain popular, consumers are increasingly looking for new and unique brands to engage with. ‘CAUSAL’ PURCHASING Another emerging trend is the ‘causal purchase’, meaning consumers are drawn to purchasing products that directly support a cause that is meaningful to them. ONLINE vs B&M Even though consumers have increasing access to and ease of online purchasing, primarily through mobile devices, we don’t believe that they’ve abandoned brick and mortar. Retailers, however, are slow to understand that store atmosphere and interactive displays are imperative to attracting consumers. Specialty retailers such as REI have mastered this consumer approach. Smaller specialty retailers have found it difficult to implement. SPECIALTY RETAIL Our focus in 2016 was on increasing specialty retail distribution. What we discovered was that specialty retailers in the active lifestyle sector, with few exceptions, are struggling to adapt to changing consumer motives and methods of purchase. Retailers consistently told us they were still holding inventory from the previous buying season and couldn’t afford to bring on a new brand. They claimed that internet sales were hampering their ability to move product on price. While partially true, we believe that the consumer is also moving away from price point and commodity product purchasing to a focus on quality and value. This is validated by the 2017 SIMA report mentioned earlier. In other words, consumers are no longer interested in the brands and products retailers have traditionally stocked. By the end of 2016 it became quite clear that retail distribution was not likely to grow at a rate that will get KOTA to sustainable profitability. While retailers are not a sales channel to be ignored, we pivoted in early 2017 to focusing on Co-Brands and direct sales. Nevertheless, we did close initial orders with Ron Jon and Scheels in 2017, and continue to pick up various smaller specialty retailers. KOTA Longboards | Confidential And Proprietary Information PAGE 17 CORPORATE PARTNER PROGRAM (CoBrands): In January 2017 we moved our distribution strategy to focus on CoBrands in three markets; (1) Brewery & Distillery, (2) Hotel & Resort, and (3) Automotive. We’d gained clients in each of these markets previously which has given us insight as to their near-term potential. Brewery & Distillery: The brewery and distillery markets, with the emergence of craft brewers and distillers, cater to the same active lifestyle demographic that has an appeal for KOTA. Quality, value and brand are all strong purchase motives for consumers in this marketplace. In fact, our first CoBrand partner was Epic Brewing back in 2013. We recognize significant potential for Corporate Partners in this sector. In June 2017 we secured an open ended license agreement with Anheuser-Busch InBev (ABI). We’re currently producing a Budweiser design highlighting Folds Of Honor Foundation. Staples, Inc. facilitates all of ABI’s merchandised and promotional product. KOTA sells units to Staples who in turn promotes and sells them to ABI distributors as promotional items. There are over 400 ABI distributors in North America. The structure of our license agreement with ABI includes (a) the ability to produce follow-on designs for other brands within InBev, (b) a license fee consisting of a $20 donation to a charity of ABI’s choosing, and (c) the ability for KOTA to sell direct to the public. To date (July 2017) we’ve fulfilled purchase orders for 200 units. Budweiser anticipates purchasing 1,000 units in 2017. Our relationship with ABI represents a new scale in our Corporate Partners program. We’ve recently been commissioned by ABI’s ‘High End’ team to produce a Goose Island design. The High End team oversees branding for ABI’s 10 craft breweries as well as other brands such as Stella Artois, Becks, Kirin, Shock Top, etc. We’re in dialogue with other decision makers within ABI about Landshark, Michelob Ultra and Busch (who holds the ABI NASCAR contract). In addition to ABI, we’ve brought on a Chicago based Brewery Industry sales rep group, Craft Brand Ambassadors (CBA), who has forged relationships with a number of midwest breweries. CBA has already brought KOTA CoBrand partners such as Bur Oak and Tighthead Brewing. KOTA Longboards | Confidential And Proprietary Information PAGE 18 Locally, we’ve co-branded with Epic, Denver Beer Co., Chain Reaction and others. We’ve also expanded into distilleries recently landing local VANJAK Vodka and are in dialogue with 10th Mountain Whiskey. While we continue to aggressively pursue additional Corporate Partners in the Brewery/Distillery market, it’s our belief that our existing relationships, particularly ABI, have the potential to propel KOTA to profitability. Hotel & Resort Halcyon, a Sage Hospitality hotel in Cherry Creek, has had great success renting KOTA co- branded longboards to their guests. Sage piloted their ‘Gear Garage’ concept with Halcyon where our boards are featured. KOTA has participated in two ‘activation’ events with Halcyon with strong hotel guest participation. Sage has indicated their intention to implement Gear Garage system-wide if they are pleased with the overall reaction at Halcyon. We’re currently in dialogue with Hyatt Hotels concerning their Florida and Maui locations. Other hotel chains such as JW Marriott, Ritz-Carlton and Crown Plaza are all potential CoBrand partners. We continue to sell product to Vail Resorts’ Kirkwood, Northstar, Heavenly Valley and Park City resorts. To date these boards have been used for rewards gifts for Epic Pass salespeople or promotional items. Through our interaction with Vail Resorts we’ve repeatedly been told that they believe they’ve saturated winter sports activities in all of their resort areas. As a result, both winter and summer, Vail Resorts is emphasizing new summer activities to attract guests. Resort areas have all of the infrastructure needed to promote longboarding as a lifestyle activity. With the KOTA simulator, we believe resorts could have group/family private lessons and longboarding tours similar in structure to private lessons during the ski season. To date we haven’t had access to resort operations decision makers to make this case but continue to develop contacts in this area. Automotive Our work with the Ferrari Owner’s Club of America in particular has led us to believe that luxury automotive and race car brands are also targets for co-branding with KOTA. Our Ferrari contacts indicate that luxury brands have seen the average age of their clientele increase significantly in the past decade, indicating they’re not attracting younger consumers to their KOTA Longboards | Confidential And Proprietary Information PAGE 19 brands. Most all are attempting to re-position their brands within the active lifestyle sector in order to attract middle aged, affluent consumers.4 We feel that brands such as BMW, Mercedes, Aston Martin, Range Rover, Porsche, NASCAR, etc. all have potential as CoBrand partners. This is further evidenced by Audi’s feature car at the 2016 Shanghai Auto Show (see picture below right). Other Notable Corporate Partners KOTA Longboards is the exclusive skateboard of Dewey Weber Surfboards. This iconic surf brand has significant presence in the Surf Lifestyle market and has helped identify KOTA as a Surf Lifestyle brand. Today, our Dewey Weber Collection fields some of our most popular designs with retailers and direct sales. Retail markets for high end surfboards have been soft for several years but have recently shown signs of a turn around. Dewey Weber is currently re-tooling its existing distribution channels to meet changing surf enthusiast buying patterns. As Dewey Weber’s sales channels mature, we expect to have joint distribution networks with Dewey Weber domestically and internationally. In the meantime, our association with Dewey Weber brings significant stature to the KOTA brand. We exhibited with Dewey Weber at Surf Expo in January and Dewey Weber has included the full line of KOTA longboards in their 2017 retailer catalog. 4 The Ferrari Owners Club desired to merchandise our co-branded boards, however, Ferrari N.V. would not authorize them to use Ferrari brand assets. KOTA Longboards | Confidential And Proprietary Information PAGE 20 DIRECT SALES Direct sales for KOTA product are driven by market exposure, ease of purchase (particularly on mobile device) and a compelling product mix. Digital Marketing In December 2016 and again in February 2017 we launched limited digital marketing campaigns utilizing Facebook ads, re-targeting and re-marketing. Budget for each campaign was $10,000. This first campaign had a high rate of conversions, however, the second campaign had a high rate of shopping cart abandonment. Lessons learned from these marketing spends indicated that our eCommerce platform (i.e., shopping cart) had significant inertia leading to purchase. We’ve now replaced our eCommerce platform with Woo Commerce, dramatically streamlining the purchase experience particularly on mobile device. KOTA’s social media reach and our ability to optimize online sales have been limited by a lack of marketing capital. Historically, we’ve gotten more direct sales from call-ins and emails than through our website. We’ve recently engaged an SEO expert who believes he can drive more conversions through our website with keyword and SEO optimization. While this effort may take a few months to see results, the immediate goal is to generate 2 sales per day (60/month) via our website. Google Concierge Program Google has selected KOTA as one of 5 start ups chosen quarterly to receive complimentary ‘concierge service’. Criteria for selection was the ‘cool factor’ of the brand and the ability to scale rapidly. Google will design, implement and provide daily labor and management for a three-month digital marketing campaign at no cost to KOTA. Google data indicate the campaign will reach nearly 3 million people driving over 100,000 to the KOTA website. KOTA is responsible for ad words, click through and YourTube video view charges during the campaign. The required budget (set by Google) for this effort is $50,000. To date, KOTA has lacked the capital to implement this program with Google. This marketing spend is a priority once capitalized. Board Designs & Branded Product We’ve taken steps to diversify our longboard designs and offer more branded product at a variety of price points. In June 2017 we signed a license agreement with Michael Schwab, an iconic American graphic artist who’s work includes logos for several Napa Valley vineyards, Turner Classic Movies and Pete’s Coffee, and artwork for the MLB All Star Game, Amtrack, National Parks, etc. In recent weeks we’ve launched the Michael Schwab Collection in three series, American Icons, American West and American Jazz. Additional series are in the works. Mr. Schwab also created the logo for Denver Mountain Parks (DMP). We’ve created a design for DMP that includes a $15 donation to DMP for every unit sold. The engagement with Mr. Schwab gives KOTA fans a genre well outside of our traditional aviation themed boards. It also sets a precedent for KOTA to work with and feature other graphic artists with followings that can extend KOTA’s reach. We continue to expand our branded ‘logo product’ lines with small lots of alternative caps, surf shirts, HydroFlask water bottles and other products. We’ve seen a jump in sales of wall hangers and skate tools as well. Optimally our suite of branded products needs to include a larger diversity of logo apparel and KOTA Longboards | Confidential And Proprietary Information PAGE 21 accessories to reach our goal of $10,000 in monthly branded product sales. We’re exploring additional items such as performance pullovers and alternative t-shirt designs, and will add items as we have capital to obtain small lots of inventory. Luckily, logo product suppliers are trending toward smaller lot, just-in-time production. We expect this will enable us to carry a larger variety of logo apparel without tying up significant capital in inventory. MARKETING SPEND Until capitalized, KOTA is severely limited in our ability to market our products and brand. Nevertheless, our activities to date have given us increased clarity as to what marketing spends will produce desired results. Social Media The Google spend mentioned earlier would be our top priority to invigorate direct sales. We’d also commit additional capital to follow-on, targeted Facebook and Google ad words campaigns to sustain the momentum we expect to gain from the Concierge Program. Tradeshows Tradeshows represent an opportunity to expose our product to potential retailers and Corporate Partners. We’ve had some success in closing retailers (Ron Jon for example) but not enough to justify the expense. With the formalization of our Corporate Partner Program, we’re pro-actively pursuing CoBrand partners and are less reliant on tradeshows for that exposure. Our strategy for tradeshows is to attend fewer, more targeted shows where we’ve had success with retailers such as Surf Expo, and those that might open up new markets to KOTA like CAMEX (collegiate logo product). KOTA Longboards | Confidential And Proprietary Information PAGE 22 Domestic Travel Having a meaningful travel budget would enhance our ability to land additional, more substantial Corporate Partners such as ABI. Securing co-branding relationships with other large companies would be a priority for travel, however, we’d leverage any travel into additional specialty retail relationships wherever possible. We know full well the potency of showing the physical product to potential Corporate and retail partners. Traditional Media KOTA has been fortunate to have been recognized in several national media segments including FOX News, ABC, Men’s Journal and Outside Magazine. This exposure has had a significant impact on sales, particularly media that is directed at the active lifestyle or veterans communities. We’ve traditionally enjoyed this exposure for free or at well below market cost due to media connections and the enthusiasm for the KOTA story and brand. As the company matures, however, we increasingly have to buy our exposure in these media outlets. Accessing national and worldwide media is extremely expensive with a long (6 months plus) lead time. Any spends in this area would be very targeted. One area that we’re exploring is paying for KOTA product placement in commercials, movies, television, etc. This provides good exposure for products on a local, national and even international basis. At this time, we believe that the ROI on this type of spend would be higher and more immediate than with traditional media. KOTA Longboards | Confidential And Proprietary Information PAGE 23 Local Events, Levitt Pavilion & the KOTA Escadrille We continue to have a presence at as many local events as possible. Our women’s riding club, Longboarding Betties, holds regular events throughout the summer months and our new relationship with Denver Mountain Parks may spark additional KOTA events. Levitt Pavilion is a 10,000+ person capacity amphitheater located 1/2 block from the KOTA factory and showroom. Levitt Pavilion opened in July 2017 and will feature over 45 concerts each summer (most of which are free). We feel there is a significant opportunity to draw consumers into our showroom prior to these scheduled events. We’re exploring a liquor sales permit through our non-profit, Carve It For Life! (CIFL!), that would allow us to have advertised KOTA showroom events featuring local craft breweries prior to select concerts. Levitt Pavilion is short on parking for 10,000 people so concert-goers already have an incentive to show up early. KOTA is the only retail space within walking distance of the concert venue. With a marketing budget we’d like to further formalize our team of riders, the KOTA Escadrille. This would give us the ability to purchase team gear for riders and pay them a nominal hourly rate for participation in weekend events. KOTA Escadrille riders engage in events and clinics as “Brand Ambassadors”, and are the primary participants in KOTA location videos. Ranging in age from 20s to 50s, our team riders have been instrumental in attracting others to the KOTA brand. In 2016 we signed our first two pro riders, Alyssa Hawley and Kevin Donoghue, pro athletes from Spartan Racing. Alyssa and Kevin leverage their respective social media followings with videos KOTA Longboards | Confidential And Proprietary Information PAGE 24 and content about KOTA. Debbie Walker, professional surfer and Dewey Weber Team surfer is also a KOTA Brand Ambassador. Located in Coco Beach, Florida, Debbie provides our social media team with high quality content on a regular basis. Recognition & Reality TV Chase Mission Main Street Grant: In 2014 KOTA was selected as a Chase Mission Main Street Grant (MMSG) winner. We were one of 20 companies nationwide selected from over 15,000 applicants to receive a $150,000 grant. From the class of 20 MMSG winners, KOTA was selected by Chase to be the televised advertisement for the 2015 MMSG program which aired in spring/ summer. KOTA was then selected as the company to be profiled in Chase’s Ink Card and Small Business Banking commercials that aired on national TV, radio and in print. Google was a primary grant sponsor of the 2014 MMSG. As a winner of the MMSG, KOTA was given a three day trip to Google headquarters for consultation on KOTA’s marketing and media strategy. This interaction with Google prompted us to overhaul our website, making it fully responsive to mobile devices. Google also gave us invaluable insights into how to market our brand with digital media. Google featured KOTA in their 2015 market report. The Profit Throughout 2015 our relationship with the senior executives at JPMorgan Chase grew stronger. In the summer of 2015, Mike and Nikki Maloney were invited to join Jamie Dimon, Chairman, JPMorgan Chase, Jen Piepszak, CEO Chase Business Banking and Gordon Smith, CEO, JPMorgan Chase on Mr. Dimon’s public relations tour of the Colorado Front Range. KOTA Longboards | Confidential And Proprietary Information PAGE 25 Shortly after, we were notified by Ms. Piepszak that Marcus Lemonis had visited her office and indicated he wanted KOTA Longboards on his ‘reality’ TV show, The Profit. We’d turned down The Profit before and expressed our deep reservations to Chase about being associated with the show. Ms. Piepszak was insistent and, as a sponsor of the show Chase eventually pressured us to accept, assuring us that we’d be given a kind treatment due to their relationship with Lemonis. In September 2015, Lemonis and Machete Productions started filming at our RiNO factory. Lemonis refused to meet with the KOTA Executive Team and never discussed our brand, market strategy, personnel, or sales and distribution. We were told that The Profit had never filmed a start- up and Lemonis admitted he’d never been involved in an early stage entity. Yet he assumed he knew everything about KOTA, our market and product without ever consulting senior management. Within a short period of time, Lemonis had manipulated our production staff into turning on one another while implying that management was dissatisfied with their performance. One by one, our production staff quit. During the six weeks of filming we lost five of our six employees. Lemonis also promoted such ideas as our product was overpriced. Having never discussed cost of goods with management, he actually advocated we sell at a price point that was below cost. As is standard on the show, Lemonis offered us an equity investment in KOTA. Mr. Maloney was in regular contact with KOTA’s Advisory Board and shareholders throughout the filming. When filming began, we all felt that doing some sort of deal with Lemonis would be beneficial to KOTA. As we analyzed the structure of his offer, however, the Board and majority of shareholders determined Lemonis’ proposal was not in the best interests of the company and its shareholders. During this time Ms. Piepszak and her staff from Chase were in direct contact with KOTA management, attempting to pressure us into accepting Lemonis’ offer. Mr. Maloney and two KOTA Board members successfully re-negotiated the deal structure with Lemonis. Lemonis later denied that he’d made us that deal and went back to his original terms. Mr. Maloney made it clear to Lemonis that his crew could finish filming but that KOTA would reject his proposed investment. KOTA never accepted any money from Lemonis. Filming wrapped up and the production crew left. We were not involved in any post-production of the episode, were not given any preview and had no further contact with Mr. Lemonis or Machete. When the episode aired, Mr. Maloney was made out to be a ogre who abused his employees. This narrative allowed Lemonis to say the deal never went forward because the founders of KOTA were such horrid people, he’d never invest his money in a company like KOTA. The entire story line and narrative was a lie crafted to protect Lemonis’ personal brand. It is fair to say that Lemonis’ singular business acumen is his ability to manipulate people through deception and deceit. The Maloney’s children were bullied at school following the airing of The Profit and we received a nearly overwhelming onslaught of vitriolic comments on social media and threatening email. We’ve not had any communication with or support from Chase since the airing of the show in December 2015. Machete Productions never reimbursed us for travel expenses we incurred during the show. The Maloney’s and KOTA management took a stand to protect KOTA shareholders and paid an awful price for it. Yet we survived it all, successfully moved our factory and have steered KOTA back to a revenue growth path that will propel the company to profitability. Such is our commitment to KOTA shareholders in keeping with all that the KOTA brand stands for. KOTA Longboards | Confidential And Proprietary Information PAGE 26 Community Outreach & CSR From day one, we’ve committed ourselves to engage with and give back to our community. We support many veteran’s and children’s health charities providing custom decks for auction sale. Typically the charity auction price for a KOTA longboard is well over $1,000 and our record today stands at $3,100 for a single complete. Carve It For Life! (CIFL!): CIFL! is a Post Traumatic Stress (PTS) healing program developed by KOTA. CIFL! was piloted in 2015 with Wounded Warrior Project (WWP) achieving excellent results. The program is open to veterans, first responders and their families. Unique aspects of CIFL! are that the program is peer-to-peer with the intent that we quickly achieve a level of trust and openness with each participant. The program is also priced such that each participant receives their own personalized longboard to continue their healing post-program. CIFL! received 501(c)(3) status in December 2015. We’re in dialogue with WWP regarding expanding the program nationally under WWP administration utilizing the KOTA simulator and demo decks. While KOTA’s veteran staff volunteers their time as counsellors, KOTA is paid for KOTA Escadrille rider participation and personalized longboards. KOTA and CIFL! were featured in Outside Magazine online on Veterans Day, 2016. Denver Public Schools: Denver Public Schools (DPS) has adopted a KOTA sponsored, for-credit longboarding class at the Middle School level. Now in its 8th semester at Merrill and Grant Beacon Middle Schools, the program has been a spectacular success. The program curriculum includes life coaching elements with the theme of achieving physical balance on the longboard and how that relates to achieving mental and emotional balance in life. KOTA Longboards | Confidential And Proprietary Information PAGE 27 Environmental Stewardship KOTA uses American Hard Rock Maple from a Forestry Stewardship Council Certified mill. FSC certification ensures responsibly managed forests that provide environmental, social and economic benefits. KOTA’s manufacturing process creates relatively little waste. To the greatest extent possible, we utilize our waste wood for other products such as tap handles for local craft breweries. KOTA has a culture of continuous improvement in terms of reducing our energy and resource consumption. KOTA Longboards | Confidential And Proprietary Information PAGE 28 JOIN OUR WORLD KOTA LONGBOARDS APPENDICES  Appendix A KOTA Pricing & Terms KOTA Longboards | Confidential And Proprietary Information PAGE 30  Appendix A KOTA Pricing & Terms Price Comparison of Longboards Over 39 Inches This chart shows the distribution of pricing for complete longboards over 39 inches sold on the internet. The labeling of longboard companies indicates generally where their boards are priced. Board companies in green seem to be targeting the older, mainstream action sports market. Observations: 1. The KOTA Premium line price (MSRP of $329) is at the 75th percentile in the market. We are generally the lowest priced longboard targeting the mainstream action sports market. 2. The KOTA “Macchi M.40” 40 inch longboard proposed price (MSRP of $275) is at the 50th percentile of longboards over 39 inches. 3. The companies on the lower end of the price range manufacture in China (Sector 9 and Arbor). Boards in the mid to high-range in price are made in the U.S. or Canada. Conclusions: 1. Pricing for both the KOTA Premium Line and Macchi M.40 is very reasonable in comparison to market prices. In fact, Premium line pricing could be considered ‘disruptive’ in comparison to board companies targeting the mainstream action sports market. 2. Product sold into the traditional skateboard market (i.e., skateboard shops selling to the 9-24 year old male) spans a price range from the mid $100s to the high $300s with the bulk of products offered priced in the mid-high $200s. KOTA Longboards | Confidential And Proprietary Information PAGE 31  Appendix B KOTA WeFunder KOTA Factory Move: KOTA Factory and Showroom 1400 South Lipan St., Denver, CO 80223 In September 2016 we moved our factory to the up-and-coming south Denver neighborhood of Ruby Hill. This 7,700 sf facility is ideal for scaling KOTA’s production, with a large showroom and retail space and spray booth. We estimate capacity at over 20,000 boards per year. This Ruby Hill factory is a rare and valuable space in the greater Denver area as the cannabis industry has caused a severe scarcity of light manufacturing space in Colorado. Ruby Hill is an established neighborhood with a mix of single-family homes and light manufacturing with a growing number of craft breweries and retailers. Located about 10 minutes south of Denver’s LoDo (Lower Downtown) area and adjacent to the Platte River, Ruby Hill will see significant gentrification over the next decade as Denver proper expands to the south. Ruby Hill is also less than three miles west of the University of Denver. Levitt Pavilion The KOTA factory is located next to Ruby Hill Park and Overland Golf Course. Ruby Hill Park features a mountain bike terrain park, snowboarding hill and the newly opened concert venue, Levitt Pavilion. Levitt Pavilion reportedly seats up to 17,000 people and hosts over 50 concerts per summer, most of which are free. Levitt Pavilion will drive significant traffic to our neighborhood. KOTA is the only retail space walkable from the concert venue. KOTA Longboards | Confidential And Proprietary Information PAGE 32  Appendix B KOTA WeFunder KOTA WeFunder Campaign: KOTA’s WeFunder campaign offers ownership in KOTA via SAFE (Simple Agreement for Future Equity). Our minimum capital raised is $90,000, however, our target is $400,000 to $1,070,000. With capital in excess of $400,000, we believe we can get to cash flow within 12-18 months. Use of capital is working capital to cover operating costs and marketing capital to grow sales well beyond our organic growth. Our goal is to reach sustainable cash flow and/or profitability without the need for further sale of equity in the company. We estimate our current factory location is capable of achieving a manufacturing rate of over 20,000 units annually. KOTA is estimated to achieve break even at between 2,200 and 2,400 units per year. KOTA Longboards | Confidential And Proprietary Information PAGE 33 WHAT BROUGHT US TOGETHER WAS THE BELIEF THAT WE COULD DO AND BUILD SOMETHING EXCEPTIONAL.