KonaRed Corp (Form: 8-K, Received: 10/05/2017 16:38:33)

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): September 29, 2017

KONARED CORPORATION

(Exact Name of Registrant as Specified in Charter)

Nevada	000-55208	99-0366971
(State or other jurisdiction of incorporation)	(Commission	(IRS Employer Identification No.)
(State or other jurisdiction of incorporation)	File Number)	(IRS Employer Identification No.)

1101 Via Callejon #200, San Clemente, California		92673
(Address of principal executive offices)		(Zip Code)

Registrant's telephone number, including area code: (808) 212-1553

N/A

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act ☐

Item 1.01 Entry into a Material Definitive Agreement

On September 29, 2017, KonaRed Corporation (the " Company ") amended agreements with VDF FutureCeuticals, Inc. (" VDF ") as described herein.

On January 28, 2014, the Company entered into a series of agreement with VDF related to a settlement of claims (the " Settlement Agreement "). The agreements are described below.

●

The Senior Convertible Note . The Senior Convertible Note with VDF, dated January 28, 2014 (the " VDF Note ") was a result of the Company entering into the Settlement Agreement with VDF at which time the VDF Note was issued to VDF. Under the VDF Note, the Company promised to pay VDF a principal amount equal to the sum of aggregate accrued and unpaid patent license fee payments plus accrued interest.

●

Warrant. On January 28, 2014, the Company issued VDF a warrant (the "Warrant ") entitling VDF, from any time after the occurrence of a warrant exercise event until the fifteenth anniversary of the issuance of the warrant, to purchase from the Company, shares of the Company's common stock representing ten percent (10%) of the Company's fully diluted outstanding shares of common stock at a purchase price of $0.001 per share.

●

Investor Rights Agreement. On January 28, 2014, the Company entered into an investor rights agreement with VDF (the " Original Investor Rights Agreement "), whereby VDF has the right to designate that number of nominees to the Company's board of directors (the " Board ") such that the total number of directors designated by VDF is in proportion to its percentage ownership of the outstanding voting power of the company. From and after the date of the Original Investor Rights Agreement and until such time as: (i) the convertible note has terminated; (ii) the warrant has terminated or been exercised; and (iii) VDF's percentage interest is less than 1%, if VDF does not have a designee on the Board, VDF shall have the right to appoint one individual as a non-voting observer entitled to attend meetings of the Board.

●

Pledge and Security Agreement . In connection with the VDF Note and other agreements disclosed herein, on January 28, 2014, the Company entered into a pledge and security agreement with VDF (the " Pledge and Security Agreement ") , whereby the Company pledged, collaterally assigned and granted to VDF, a security interest in all of the Company's right, title and interest, whether now owned or hereafter acquired, in and to the Company's property to secure the prompt and complete payment and performance of obligations existing under any of the agreements described herein.

First Amendment to VDF Note:

On September 29, 2017, the Company and VDF amended the VDF Note by entering into Amendment No. 1 to Senior Convertible Note (the " First Amendment to VDF Note "). The First Amendment to VDF Note amended the following the Principal of the VDF Note to equal $916,457 and the Conversion Price of the VDF Note to $0.07. The VDF Note shall be cancelled upon delivery to the Holder of 13,092,242 shares on the Company's common stock and the Pledge and Security Agreement shall be terminated upon the cancellation of the VDF Note. The VDF Note and the First Amendment to VDF Note shall collectively be referred to as the " Senior Note".

Amended and Restarted Investor Rights Agreement:

On September 29, 2017, the Company and VDF amended the Original Investor Rights Agreement by entering into an Amended and Restated Investor Rights Agreement (the " Amended Investor Rights Agreement "). The Amended Investor Rights Agreement amended the Original Investor Rights Agreement by removing VDF's right to designate the number of nominees to the Board, removing VDF's right to appoint one individual Board Observer, and by removing certain covenants of the Company.

Sale Restriction Agreement:

On September 29, 2017, the Company and VDF entered into a Sale Restriction Agreement (the " Sale Restriction Agreement ") whereby the parties have agreed to certain restrictions on VDF's ability to publicly sell though market transactions the shares of Company common stock, par value $0.001 per share (" Common Stock "), that were acquired by VDF upon completion of the Share Conversion (as defined in the Senior Note) of the Senior Note or that may be acquired by VDF upon the exercise of the Warrant (collectively, the " Covered Shares "). Under the Sale Restriction Agreement, VDF will be permitted to publicly sell through transactions on a stock exchange or over-the-counter market upon which the Common Stock is traded up to 1,050,000 of the Covered Shares (the " Quarterly Sales Limit ") in each three-month period, without the prior written consent of the Company with the first three-month period commencing on the first day of September 2017 (the " Restriction Period Commencement Date "), provided, however, if VDF does not sell at least 4 million of the Covered Shares during the twelve-month period commencing on the Restriction Period Commencement Date (the " Initial Restriction Period ") then the Quarterly Sales Limit shall terminate as of the end of the Initial Restriction Period and no longer be in force or effect. If VDF sells at least 4 million of the Covered Shares during the Initial Restriction Period, then the Quarterly Sales Limit shall continue in force and effect for a subsequent twelve-month period commencing at the end of the Initial Restriction Period (the " Second Restriction Period "). If, during the Second Restriction Period, VDF does not sell at least 4 million of the Covered Shares, not including any Covered Shares sold during the Initial Restriction Period, then the Quarterly Sales Limit shall terminate and no longer be in force or effect as of the end of the Second Restriction Period. If, during the Second Restriction Period, the Shareholder sells at least 4 million of the Covered Shares, not including any Covered Shares sold during the Initial Restriction Period, then the Quarterly Sales Limit shall continue in force and effect for a subsequent twelve-month period commencing at the end of the Second Restriction Period (the " Final Restriction Period "). If not terminated earlier as set forth above, the Quarterly Sales Limit shall terminate at the end of the Final Restriction Period. VDF acknowledges that the Company is not providing any guarantee to the Shareholder that the Shareholder will be able to sell the Covered Shares. The Company is listed on the OTCQB as of the date of this Agreement and, at its own discretion, the Company may elect to delist from the OTCQB or move to another qualified exchange.

Additionally, the Sale Restriction Agreement terminated VDF's right to demand registration of the Covered Shares pursuant to the Registration Rights Agreement between the parties, dated January 28, 2014, at any time when the Quarterly Sales Limit is in effect. The Sale Restriction Agreement shall continue in full force and effect until the earlier of (i) termination of the Quarterly Sales Limit and (ii) the occurrence of a change of control.

The foregoing description of the First Amendment to VDF Note, Amended Investor Rights Agreement, and the Sale Restriction Agreement is qualified in its entirety by reference to the full text of each agreement, a copy of each agreement is filed as Exhibit 10.1, Exhibit 10.2 and Exhibit 10.3, respectively, to this Current Report on Form 8-K and is incorporated by reference herein.

Item 3.02 Unregistered Sales of Equity Securities

On October 4, 2017, the Company issued to VDF, holder of the Senior Note, 13,092,242 shares of the Company's Common Stock (the " Conversion Shares ") in connection with the conversion for VDF pursuant to the term of the Senior Note, described in this Current Report in Item 1.01. VDF converted $916,457 of principal amount of the Senior Note at a conversion price of $0.07.

The Senior Notes were originally issued in a private placement in reliance upon the exemption from registration in Section 4(a)(2) of the Securities Act of 1933, as amended (the " Securities Act "). The Senior Note was issued upon conversion of the Senior Note were issued in reliance upon the exemption from registration in Section 3(a)(9) of the Securities Act, as the Conversion Shares were exchanged or issued by the Company in a transaction where no commission or other remuneration was paid or given directly or indirectly for soliciting such exchange or issuances.

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On September 30, 2017, Shaun Roberts relinquished his role as the Company's Chief Executive Officer to concentrate on his role as Chairman of the Company's Board of Directors (the " Board "). The Board then appointment Kyle Redfield, the Company's President, as the Company's Chief Executive Officer, effective September 30, 2017.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits:

Exhibit		Description

10.1		Amendment No. 1 to Senior Convertible Note between KonaRed Corporation and VDF FutureCeuticals, Inc., dated September 29, 2017.

10.2		Amended and Restated Investor Rights Agreement between KonaRed Corporation and VDF FutureCeuticals, Inc., dated September 29, 2017.

10.3		The Sale Restriction Agreement between KonaRed Corporation and VDF FutureCeuticals, Inc., dated September 29, 2017.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: October 5, 2017	KONARED CORPORATION


	By:	/s/ Kyle Redfield
	Name:	Kyle Redfield
	Title:	Chief Executive Officer

Exhibit 10.1

AMENDMENT NO. 1 TO

SENIOR CONVERTIBLE NOTE

This Amendment No. 1 to that certain Senior Convertible Note (this " First Amendment "), is made and entered this 29th day of September, 2017 by and between KonaRed Corporation, a Nevada corporation (the " Company "), and VDF FutureCeuticals, Inc., an Illinois corporation (the " Holder ", together with the Company, the " Parties ").

WHEREAS, heretofore the Company issued to the Holder the Senior Convertible Note, dated as of January 28, 2014 (the " Note ");

WHEREAS, pursuant to Section 12 of the Note, the Note may only be amended, supplemented or modified pursuant to a writing signed by the Company and the Holder; and

WHEREAS, the Parties wish to amend the Note to reflect the changes set forth herein.

NOW, THEREFORE, in consideration of the premises and the mutual covenants and agreements hereinafter set forth, the Parties hereto agree as follows:

Amendment and Additional Terms . The Parties hereby agree to amend certain terms of the Note as follows:

The definition of Principal in Section 25(gg) of the Note shall be amended and restated in its entirety as follows:

"(gg) 'Principal' means an amount equal to $916,457."

Section 3(b)(ii) of the Note shall be amended and restated in its entirety as follows:

"(ii) 'Conversion Price' means as of any Conversion Date, U.S.$0.07."

Share Conversion . In accordance with the terms and conditions of this First Amendment, the Company hereby agrees to consummate the Share Conversion of the Note as of the date hereof (the " Final Share Conversion ").

Cancellation of the Note . Pursuant to Section 21 of the Note, upon completion of the Final Share Conversion and delivery to the Holder of the 13,092,242 shares of the Company common stock to be issued pursuant to the Final Share Conversion, the Note shall be deemed cancelled.

Pledge and Security Agreement . The Parties acknowledge that upon the cancellation of the Note, the Pledge and Security Agreement, dated as of January 28, 2014, by and between the Holder and the Company shall terminate in accordance with its terms.

Definitions . Capitalized terms used but not defined in this First Amendment shall have the meanings ascribed thereto in the Note.

Effect of First Amendment . This First Amendment is hereby incorporated into and made a part of the Note. Except as otherwise expressly provided herein, all of the terms and conditions of the Note shall remain in full force and effect without modification. Sections 15-23 of the Note are incorporated herein by reference and shall apply mutatis mutandis to the terms and conditions of this First Amendment and to each of the Parties. From and after the date of this First Amendment, references in the Note to the "Note" or any provision thereof shall be deemed to refer to the Note or such provision as amended hereby unless the context otherwise requires, and references in the Note to the "date hereof" shall be deemed to refer to the original date of the Note. References in this First Amendment to "the date hereof" refer to the date set forth in the preamble to this First Amendment.

[ Signature page follows ]

IN WITNESS WHEREOF, each of the Parties hereto has caused this First Amendment to be executed on the date first written above by their respective duly authorized officers.

	KONARED CORPORATION


	By:	/s/ Kyle Redfield
		Name: Kyle Redfield
		Title: Chief Executive Officer



		VDF FUTURECEUTICALS, INC.


	By:	/s/ J. Randal Wexler
		Name: J. Randal Wexler
		Title: Vice President and General Counsel

Exhibit 10.2

AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT

THIS AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT, dated as of September 29, 2017 (this " Agreement " ), is made and entered into by and between KonaRed Corporation, a Nevada corporation (the " Company " ) and VDF FutureCeuticals, Inc., an Illinois corporation ( " Investor " ).

WHEREAS, Investor and the Company entered into that certain Settlement Agreement dated as of January 28, 2014 (the " Settlement Agreement ") to settle certain outstanding litigation between the parties;

WHEREAS, in connection with the execution of the Settlement Agreement, the Company issued to Investor a Senior Convertible Note of the Company dated as of January 28, 2014 (the " Note ") and a Warrant to purchase shares of Common Stock of the Company dated as of January 28, 2014 (the " Warrant ");

WHEREAS, as a condition to entering into the Settlement Agreement, the Note and the Warrant, Investor and the Company also agreed to enter into the original Investor Rights Agreement, dated as of January 28, 2014 (" Original Investor Rights Agreement "); and

WHEREAS, in connection with the parties entering into an amendment to the Note dated as of the date hereof (the Note, as so amended, the " Amended Note ") and an amendment and restatement of the Warrant dated as of the date hereof (the " Amended and Restated Warrant "), the Company and Investor agree to amend and restate the Original Investor Rights Agreement.

Accordingly, the parties hereto agree as follows:

ARTICLE 1

DEFINITIONS

1.1 Definitions . As used in this Agreement, and unless the context requires a different meaning, the following terms shall have the meanings set forth below:

" Agreement " has the meaning assigned to such term in the preamble.

" Amended and Restated Warrant " has the meaning assigned to such term in the recitals.

" Amended Note " has the meaning assigned to such term in the recitals.

" Articles of Incorporation " means the certificate of incorporation of the Company, as the same may have been amended.

" Beneficially own " with respect to any securities means having "beneficial ownership" of such securities as determined pursuant to Rule 13d-3 under the Exchange Act, as in effect on the date hereof.

" Board of Directors " means either the board of directors of the Company or any duly authorized committee thereof.

" Business Day " means any day other than (i) a Saturday or Sunday or (ii) a day on which banking institutions in New York City are authorized or obligated by law or executive order to remain closed.

" Bylaws " means the bylaws of the Company, as the same may have been amended.

" Change of Control " means (a) any sale, transfer, lease or license of all or substantially all of the assets of the Company in a transaction or series of related transactions, (b) any merger, consolidation or reorganization that results in any Person or group of Persons acting in concert owning in excess of 50% of the outstanding voting power of the Company, (c) any issuance or sale or series of issuances or sales of capital stock of the Company by the Company or any holder of such capital stock that results in any Person or group of Persons acting in concert owning in excess of 50% of the outstanding voting power of the Company or (d) the voluntarily or involuntarily dissolution or liquidation of the Company or winding up of the Company's affairs, or the taking by the Company of any action to effect any of the foregoing.

" Commission " means the Securities and Exchange Commission or any similar agency then having jurisdiction to enforce the Securities Act.

" Common Stock " means any shares of common stock, par value $0.001 per share, of the Company, now or hereafter authorized to be issued, and any and all securities of any kind whatsoever of the Company or any successor thereof which may be issued on or after the date hereof in respect of, in exchange for, or upon conversion of shares of Common Stock pursuant to a merger, consolidation, stock split, reverse split, stock dividend, recapitalization of the Company or otherwise.

" Company " has the meaning assigned to such term in the preamble.

" Conversion Shares " means the shares of Common Stock issuable upon conversion of the Amended Note or the exercise of the Amended and Restated Warrant.

" Exchange Act " means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder by the Commission from time to time.

" GAAP " means United States generally accepted accounting principles consistently applied.

" Governmental Authority " means any court, tribunal, arbitrator, arbitrational panel or authority, agency, commission, official or other instrumentality of the United States or any other country, or any supra-national organization, state, county, city or other political subdivision or any self-regulatory organization.

" Investor " has the meaning assigned to such term in the recitals .

" License Agreement " means the license agreement among the Company and the Investor dated January 28, 2014, as amended.

" Note " has the meaning assigned to such term in the recitals.

" Order " means any writ, judgment, decree, injunction, award or similar order of any Governmental Authority, including any award in an arbitration proceeding (in each case, whether preliminary or final).

" Original Investor Rights Agreement " has the meaning assigned to such term in the recitals.

" Person " means a legal person, including any individual, corporation, estate, partnership, joint venture, association, joint-stock company, company, limited liability company, trust, unincorporated association, Governmental Authority, or any other entity of whatever nature.

" Pledge and Security Agreement " means that certain Pledge and Security Agreement between the Company and Investor, dated January 28, 2014.

" Registration Rights Agreement " means the Registration Rights Agreement between the Company and Investor dated January 28, 2014.

" Requirement of Law " means any law, statute, code, treaty, Order, ordinance, rule, regulation or other requirement promulgated or enacted by any Governmental Authority.

" Rule 144 " means Rule 144 promulgated by the Commission under the Securities Act, as such Rule may be amended from time to time, or any similar rule or regulation hereafter adopted by the Commission.

" Securities Act " means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder by the Commission from time to time.

" Settlement Agreement " has the meaning assigned to such term in the recitals.

" VDF-KonaRed Agreements " means this Agreement, the Amended Note, the Pledge and Security Agreement, the Registration Rights Agreement, the Amended and Restated Warrant and the Amended and Restated License Agreement.

" Voting Securities " mean any class or classes of stock of the Company pursuant to which the holders thereof have the general power under ordinary circumstances to vote with respect to the election of the Board of Directors, irrespective of whether or not, at the time, stock of any other class or classes shall have, or might have, voting power by reason of the happening of any contingency.

" Warrant " has the meaning assigned to such term in the recitals .

ARTICLE 2

AGREEMENTS

2.1 Registration Rights . The Company shall not grant any right of registration under the Securities Act relating to any of its securities to any Person other than Investor if such rights would or could reasonably be expected to frustrate, impede or limit Investor's rights pursuant to the Registration Rights Agreement (it being understood that inclusion of securities of the Company in any registration statement filed by the Company that is not a Demand Registration (as defined in the Registration Rights Agreement) that, by reason of the restrictions on the amount of securities that may be included in a registration statement under Rule 415 promulgated under the Securities Act, results in a limitation on the amount of securities that may be registered on behalf of the Investor in a Demand Registration shall not be deemed to frustrate, impede or limit Investor's rights under the Registration Rights Agreement).

2.2 Rule 144 . The Company shall file all reports required to be filed by it under the Securities Act and the Exchange Act and shall take such further action as Investor may reasonably request, all to the extent required to enable Investor to sell the Common Stock into which the Note may be converted pursuant to and in accordance with Rule 144. Such action shall include, but not be limited to, making available adequate current public information meeting the requirements of paragraph (c) of Rule 144.

2.3 Availability of Common Stock . The Company shall at all times reserve and keep available out of its authorized but unissued Common Stock, for the purpose of effecting the conversion of the Amended Note and the exercise of the Amended and Restated Warrant, at least the full number of shares of Common Stock then issuable upon the conversion of the Amended Note and the exercise of the Amended and Restated Warrant. The Company will, from time to time, take the actions specified in Section 7 of the Amended Note and Section 6 of the Amended and Restated Warrant to increase the authorized amount of Common Stock if at any time the number of shares of Common Stock remaining unissued and available for issuance shall be insufficient to permit conversion of the Amended Note and/or exercise of the Amended and Restated Warrant.

2.4 Legends . Any legends placed on the Amended and Restated Warrant or the Conversion Shares, pursuant to the transactions contemplated by the VDF-KonaRed Agreements shall be removed by the Company upon delivery of an opinion of counsel reasonably acceptable to the Company stating that such legend is no longer necessary.

2.5 Takeover Statutes . If any "fair price," "moratorium," "control share acquisition" or other form of antitakeover statute or regulation shall become applicable to the transactions contemplated by the VDF-KonaRed Agreements, the Board of Directors of the Company shall grant such approvals and take such actions as are reasonably necessary so that the transactions contemplated by the VDF-KonaRed Agreements may be consummated as promptly as practicable on the terms contemplated hereby and otherwise act to eliminate or minimize the effects of such statute or regulation on the transactions contemplated by the VDF-KonaRed Agreements.

ARTICLE 3

TERMINATION

3.1 Term . The term of this Agreement shall be in effect until such time as: (i) the Amended Note no longer remains outstanding; (ii) the Amended and Restated Warrant no longer remains outstanding; and (iii) Investor fails to own shares of Common Stock or other Voting Securities in the Company. Notwithstanding the foregoing, in the event the Investor transfers the Amended Note (in whole) and the Amended and Restated Warrant and does not hold Conversion Shares, Section 2.1 shall terminate and be of no force and effect.

ARTICLE 4

MISCELLANEOUS

4.1 Survival . All covenants and agreements of the Company and Investor contained in this Agreement shall remain operative and in full force and effect regardless of any investigation made by or on behalf of Investor or any controlling Person thereof or by or on behalf of the Company, any of its officers and directors or any controlling Person thereof. The covenants and agreements contained herein shall survive in accordance with their terms.

4.2 Notices . All notices or other communications required or permitted hereunder shall be in writing and shall be delivered personally, by facsimile (with receipt confirmed telephonically or via email) or sent by certified, registered or express mail, postage prepaid. Any such notice shall be deemed given if delivered personally or facsimile, on the date of such delivery or such confirmation is received, or if sent by reputable overnight courier, on the first Business Day following the date of such mailing, as follows:

(a) if to the Company:

	KonaRed Corporation 1101 Via Callejon #200 San Clemente, California 92673 Attention: Kyle Redfield Facsimile: (808) 442-9922 Email: kyle@konared.com
	with a copy to (which shall not constitute notice):

	Stradling, Yocca Carlson & Rauth, P.C. 4365 Executive Drive Suite 1500 San Diego, CA 92121 Attention: Hayden Trubitt Facsimile: (858) 408-4251 Email: htrubitt@sycr.com

(b) if to Investor:

	VDF FutureCeuticals, Inc. 2692 N. State Rt. 1-17 Momence, IL 60954 Attention: J. Randal Wexler Facsimile: (815) 472-3529 Email: RWexler@futureceuticals.com

	with a copy to (which shall not constitute notice):

	Sidley Austin LLP
	One South Dearborn
	Chicago, Illinois 60603
	Attention: Pran Jha
	Facsimile: (312) 853-7036 Email: pjha@sidley.com

Any party may by notice given in accordance with this Section 4.2 designate another address or Person for receipt of notices hereunder.

4.3 Successors and Assigns . This Agreement shall inure to the benefit of and be binding upon the successors and permitted assigns of the parties hereto. Other than the parties hereto and their successors and permitted assigns, and no Person is intended to be a beneficiary of this Agreement. No party hereto may assign its rights under this Agreement without the prior written consent of the other party hereto; provided , however , that, without the prior written consent of the Company, Investor may assign its rights hereunder (along with the corresponding obligations) to any purchaser or transferee of the Amended Note or the Amended and Restated Warrant. Any assignee of Investor pursuant to the proviso of the foregoing sentence shall be deemed to be "Investor" for all purposes of this Agreement.

4.4 Amendment and Waiver . (1) No failure or delay on the part of the Company or Investor in exercising any right, power or remedy hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right, power or remedy preclude any other or further exercise thereof or the exercise of any other right, power or remedy.

(b) Any amendment, supplement or modification of or to any provision of this Agreement and any waiver of any provision of this Agreement shall be effective only if it is made or given in writing and signed by the Company and Investor.

4.5 Counterparts . This Agreement may be executed in any number of counterparts and by the parties hereto in separate counterparts, all of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement.

4.6 Headings . The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof.

4.7 Governing Law; Waiver of Jury Trial .

(a) Governing Law . This Agreement shall be construed and enforced in accordance with, and the rights and obligations of the parties hereto shall be governed by, the laws of the State of New York, without giving effect to principles of conflicts of laws.

(b) Waiver of Jury Trial . With respect to any action or proceeding arising out of or relating to this Agreement or the transactions contemplated hereby, each of the parties hereby irrevocably, to the extent not prohibited by applicable law that cannot be waived, waives, and covenants that it will not assert (whether as plaintiff, defendant or otherwise), any right to trial by jury in any action arising in whole or in part under or in connection with this Agreement or the transactions contemplated hereby, whether now existing or hereafter arising, and whether sounding in contract, tort or otherwise, and agrees that any of them may file a copy of this paragraph with any court as written evidence of the knowing, voluntary and bargained-for agreement among the parties irrevocably to waive its right to trial by jury in any action or proceeding whatsoever between them relating to this Agreement or the transactions contemplated hereby. Such action or proceeding shall instead be tried by a judge sitting without a jury.

4.8 Severability . If any one or more of the provisions contained herein, or the application thereof in any circumstance, is held invalid, illegal or unenforceable in any respect for any reason, the validity, legality and enforceability of any such provision in every other respect and of the remaining provisions hereof shall not be in any way impaired, unless the provisions held invalid, illegal or unenforceable shall substantially impair the benefits of the remaining provisions hereof.

4.9 Entire Agreement . This Agreement, together with the schedules and exhibits hereto, and the other VDF-KonaRed Agreements referred to herein or delivered pursuant hereto, are intended by the parties as a final expression of their agreement and intended to be a complete and exclusive statement of the agreement and understanding of the parties hereto in respect of the subject matter contained herein and therein. There are no restrictions, promises, warranties or undertakings, other than those set forth or referred to herein or therein. This Agreement, together with the schedules and exhibits hereto, and the other VDF-KonaRed Agreements referred to herein or delivered pursuant hereto, supersede all prior agreements and understandings between the parties with respect to such subject matter.

4.10 Further Assurances . Subject to the terms and conditions of this Agreement, as of the date hereof, the Company and Investor agree to cooperate with each other, and at the request of the other party, to execute and deliver any further instruments or documents and take all such further action as the other party may reasonably request in order to evidence or effectuate the consummation of the transactions contemplated by the VDF-KonaRed Agreements and to otherwise carry out the intent of the parties hereunder.

4.11 Public Announcements . Except as required by any Requirement of Law or the rules of any securities exchange, none of the parties hereto will issue or make any reports, statements or releases to the public with respect to this Agreement or the transactions contemplated by the VDF-KonaRed Agreements without the approval of the other party (such approval not to be unreasonably withheld or delayed). The Investor acknowledges that the VDF-KonaRed Agreements and related amendments will be publicly filed on EDGAR and disclosed in the Company's periodic filings.

4.12 Specific Performance . The parties acknowledge that money damages are not an adequate remedy for violations of this Agreement and that any party may, in its sole discretion, apply to a court of competent jurisdiction for specific performance or injunctive or such other relief as such court may deem just and proper in order to enforce this Agreement or prevent any violation hereof and, to the extent permitted by applicable law, each party waives any objection to the imposition of such relief or any requirement for a bond.

* * * * * * * *

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed and delivered by their respective officers hereunto duly authorized as of the date first above written.

	KONARED CORPORATION

	By:	/s/ Kyle Redfield
		Name: Kyle Redfield
		Title: Chief Executive Officer



	VDF FUTURECEUTICALS, INC.

	By:	/s/ J. Randal Wexler
		Name: J. Randal Wexler
		Title: Vice President and General Counsel

Exhibit 10.3

SALE RESTRICTION AGREEMENT

THIS SALE RESTRICTION AGREEMENT (the "Agreement") is made and entered into as of September 29, 2017 (the "Effective Date"), by and between KonaRed Corporation, a Nevada corporation (the "Company"), and VDF FutureCeuticals, Inc., an Illinois corporation (the "Shareholder").

WHEREAS, the Shareholder and the Company are parties to (i) the Coffee Fruit Patent License, Coffeeberry® Trademark License and Raw Materials Supply Agreement, dated as of January 28, 2014, as amended (the "License Agreement"), by and between the Shareholder and the Company, (ii) the VDF FutureCeuticals Premium Hawaiian Coffee Fruit Purchase Agreement, dated as of November 6, 2015, as amended (the "Supply Agreement"), by and between the Shareholder and the Company, (iii) the Senior Convertible Note, dated as of January 28, 2014, as amended (the "Note"), issued by the Company to the Shareholder, (iv) the Pledge and Security Agreement, dated as of January 28, 2014 (the "Security Agreement"), by and between the Shareholder and the Company, (v) the Warrant, dated as of January 28, 2014, as amended (the "Warrant"), issued by the Company to the Shareholder, (vi) the Registration Rights Agreement, dated as of January 28, 2014 (the "Registration Rights Agreement"), by and between the Shareholder and the Company, and (vii) the Investor Rights Agreement, dated as of January 28, 2014, as amended (the "Investor Rights Agreement" and, together with the License Agreement, the Supply Agreement, the Note, the Security Agreement, the Warrant and the Registration Rights Agreement, collectively, the "VDF-KonaRed Agreements"), by and between the Shareholder and the Company.

WHEREAS, the parties have agreed to certain restrictions on the Shareholder's ability to publicly sell though market transactions the shares of Company common stock, par value $0.001 per share ("Common Stock"), that were acquired by the Shareholder upon completion of the Share Conversion (as defined in the Note) of the Note or that may be acquired by the Shareholder upon the exercise of the Warrant (collectively, the "Covered Shares").

NOW, THEREFORE, in consideration of the foregoing premises and the mutual covenants contained herein, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

1. Quarterly Sales Limit.

(a) Subject to Sections 1(b) and 1(c), the Shareholder will be permitted to publicly sell through transactions on a stock exchange or over-the-counter market upon which the Common Stock is traded up to 1,050,000 of the Covered Shares (the "Quarterly Sales Limit") in each three-month period, without the prior written consent of the Company, with the first three-month period commencing on the first day of the month in which the Effective Date occurs (the "Restriction Period Commencement Date"); provided , however , if the Shareholder does not sell at least 4 million of the Covered Shares during the twelve-month period commencing on the Restriction Period Commencement Date (the "Initial Restriction Period"), then the Quarterly Sales Limit shall terminate as of the end of the Initial Restriction Period and no longer be in force or effect. If the Shareholder sells at least 4 million of the Covered Shares during the Initial Restriction Period, then the Quarterly Sales Limit shall continue in force and effect for a subsequent twelve-month period commencing at the end of the Initial Restriction Period (the "Second

Restriction Period"). If, during the Second Restriction Period, the Shareholder does not sell at least 4 million of the Covered Shares, not including any Covered Shares sold during the Initial Restriction Period, then the Quarterly Sales Limit shall terminate and no longer be in force or effect as of the end of the Second Restriction Period. If, during the Second Restriction Period, the Shareholder sells at least 4 million of the Covered Shares, not including any Covered Shares sold during the Initial Restriction Period, then the Quarterly Sales Limit shall continue in force and effect for a subsequent twelve-month period commencing at the end of the Second Restriction Period (the "Final Restriction Period"). If not terminated earlier as set forth above, the Quarterly Sales Limit shall terminate at the end of the Final Restriction Period.

(b) Sales by the Shareholder of the Covered Shares other than (i) sales made in reliance on Rule 144 or Rule 144A promulgated under the Securities Act of 1933, as amended (the "Securities Act") or (ii) pursuant to any registration statement under the Securities Act shall not be subject to, or otherwise taken into account in determining compliance with, the Quarterly Sales Limit.

(c) The restrictions set forth in Section 1(a) shall not apply to any transfer by the Shareholder or any Permitted Transferee (as defined below) of the Covered Shares (i) to any Affiliate of the Shareholder or such Permitted Transferee, as applicable, (ii) as a bona fide gift or gifts to any donee or donees of the Shareholder or such Permitted Transferee, as applicable, or (iii) to any trust for the direct or indirect benefit of the Shareholder or such Permitted Transferee, as applicable, or the immediate family of the Shareholder or such Permitted Transferee, as applicable; provided , that such Affiliate, donee or donees and trustee of such trust agree in writing to be bound by the restrictions set forth herein. For purposes of this Agreement, (x) "immediate family" shall mean any relationship by blood, marriage or adoption, not more remote than first cousin, (y) "Affiliate" shall mean with respect to any Person, any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person and (z) "Permitted Transferee" shall mean any Person described in clause (i), (ii) or (iii) above.

(d) Without limiting the rights of the Shareholder under Sections 1(a)-(c) above, the Shareholder acknowledges that the Company is not providing any guarantee to the Shareholder that the Shareholder will be able to sell the Covered Shares. The Company is listed on the OTCQB as of the date of this Agreement and, at its own discretion, the Company may elect to delist from the OTCQB or move to another qualified exchange.

(e) Each certificate for the Covered Shares and any subsequent certificate issued to any Permitted Transferee of any such certificate, shall be stamped or otherwise imprinted with the legend in substantially the following form:

"TRANSFER OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE IS SUBJECT TO THE CONDITIONS SPECIFIED IN A SALE RESTRICTION AGREEMENT DATED SEPTEMBER 29, 2017, AS AMENDED AND MODIFIED FROM TIME TO TIME. A COPY OF SUCH CONDITIONS MAY BE OBTAINED FROM THE COMPANY UPON WRITTEN REQUEST AND WITHOUT CHARGE."

2. Registration Rights Agreement. The Shareholder shall not exercise its right to demand registration of the Covered Shares pursuant to Section 2.1 of the Registration Rights Agreement at any time when the Quarterly Sales Limit is in effect. The restriction set forth in the preceding sentence shall not limit the right of the Shareholder to require incidental registration of Covered Shares pursuant to Section 2.2 of the Registration Rights Agreement.

3. Adjustments to Prevent Dilution. If, at any time during the Term of this Agreement, there is a change in the number of issued and outstanding shares of Common Stock, or securities convertible or exchangeable into shares of Common Stock, in each case, as a result of a reclassification, stock split (including reverse stock split), stock dividend or stock distribution, recapitalization, merger, combination, exchange of shares, subdivision or other similar transaction, there will be a proportional adjustment to the Quarterly Sales Limit to provide the Shareholder with the same economic effect as contemplated by this Agreement prior to such event.

4. Beneficial Ownership. Except as otherwise provided in this Agreement or any other agreements between the parties, the Shareholder shall be entitled to all of the rights of beneficial ownership of the Covered Shares, including the right to vote the Covered Shares for any and all purposes.

5. Transfer Agent. In accordance with the terms and conditions set forth in this Agreement, the Company may impose stop-transfer instructions preventing the Transfer Agent from effecting any actions in violation of this Agreement.

6. Term and Termination. The term of this agreement shall commence on the Effective Date and shall continue in full force and effect until the earlier of (i) termination of the Quarterly Sales Limit in accordance with Section 1 and (ii) the occurrence of a Change of Control (the "Term"); provided , that the parties may mutually agree in writing to terminate this Agreement prior to the expiration of the Term. Upon expiration of the Term, this Agreement shall terminate and shall be of no further force or effect.

7. Notices. All notices or other communications required or permitted hereunder shall be in writing and shall be delivered personally, by facsimile (with receipt confirmed telephonically or via email) or sent by certified, registered or express mail, postage prepaid. Any such notice shall be deemed given if delivered personally or facsimile, on the date of such delivery or such confirmation is received, or if sent by reputable overnight courier, on the first business day following the date of such mailing, as follows:

if to the Company:

KonaRed Corporation

1101 Via Callejon #200

San Clemente, California 92673

Attention: Kyle Redfield

Facsimile: (808) 442-9922

Email: kyle@konared.com

	with a copy to (which shall not constitute notice):

	Stradling Yocca Carlson & Rauth, P.C. 4365 Executive Drive, suite 1500 San Diego, CA 92121 Attention: Hayden Trubitt Facsimile: (858) 408-4251 Email: htrubitt@sycr.com

if to Shareholder:

	VDF FutureCeuticals, Inc. 2692 N. State Rt. 1-17 Momence, Illinois 60954 Attention: J. Randal Wexler Facsimile: (815) 472-3529 Email: RWexler@futureceuticals.com

	with a copy to (which shall not constitute notice):

	Sidley Austin LLP
	One South Dearborn
	Chicago, Illinois 60603
	Attention: Pran Jha
	Facsimile: (312) 853-7036 Email: pjha@sidley.com

8. Amendments and Waivers. This Agreement and any of the provisions hereof may be amended, waived (either generally or in a particular instance and either retroactively or prospectively), modified or supplemented, in whole or in part, only by written agreement of the Company and the Shareholder; provided , that the observance of any provision of this Agreement may be waived in writing by the party that will lose the benefit of such provision as a result of such waiver. The waiver by any party hereto of a breach of any provision of this Agreement shall not operate or be construed as a further or continuing waiver of such breach or as a waiver of any other or subsequent breach, except as otherwise explicitly provided for in such waiver. Except as otherwise expressly provided herein, no failure on the part of any party to exercise, and no delay in exercising, any right, power or remedy hereunder, or otherwise available in respect hereof at law or in equity, shall operate as a waiver thereof, nor shall any single or partial exercise of such right, power or remedy by such party preclude any other or further exercise thereof or the exercise of any other right, power or remedy. The execution of a counterpart signature page to this Agreement after the date hereof by any Person as provided for herein shall not require consent of any party hereto and shall not be deemed an amendment to this Agreement.

9. Specific Performance. The parties hereto agree that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed in accordance with its specific terms or was otherwise breached and further agree that money damages or other remedy at law would not be a sufficient or adequate remedy for any breach or violation of, or a default under, this Agreement by them and that, in addition to all other remedies available to them, each of them shall be entitled to an injunction restraining such breach, violation or default or threatened breach, violation or default and to any other equitable relief, including, without limitation, specific performance of the terms and provisions of this Agreement. Any requirements for the securing or posting of any bond with respect to such remedy are hereby waived by each of the parties hereto. Each party further agrees that, in the event of any action for an injunction or other equitable remedy in respect of such breach or enforcement of specific performance, it will not assert the defense that a remedy at law would be adequate.

10. Governing Law; Waiver of Jury Trial.

11. Severability. If any one or more of the provisions contained herein, or the application thereof in any circumstance, is held invalid, illegal or unenforceable in any respect for any reason, the validity, legality and enforceability of any such provision in every other respect and of the remaining provisions hereof shall not be in any way impaired, unless the provisions held invalid, illegal or unenforceable shall substantially impair the benefits of the remaining provisions hereof.

12. Entire Agreement. This Agreement and the documents referred to herein or delivered pursuant hereto, are intended by the parties as a final expression of their agreement and intended to be a complete and exclusive statement of the agreement and understanding of the parties hereto in respect of the subject matter contained herein. There are no restrictions, promises, warranties or undertakings, other than those set forth or referred to herein. This Agreement and the documents referred to herein or delivered pursuant hereto, supersede all prior agreements and understandings between the parties with respect to such subject matter.

13. Third Party Beneficiaries. This Agreement is for the sole benefit of the parties hereto and their respective successors and permitted assigns and nothing herein, express or implied, is intended to or shall confer upon any other Person, other than a Permitted Transferee, any legal or equitable right, benefit or remedy of any nature whatsoever, under or by reason of this Agreement.

14. Counterparts. This Agreement may be executed in any number of counterparts and by the parties hereto in separate counterparts, all of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement.

15. Definitions.

(a) " Change of Control " means (a) any sale, transfer, lease or license of all or substantially all of the assets of the Company in a transaction or series of related transactions, (b) any merger, consolidation or reorganization that results in any Person or group of Persons acting in concert owning in excess of 50% of the outstanding voting power of the Company, (c) any issuance or sale or series of issuances or sales of capital stock of the Company by the Company or any holder of such capital stock that results in any Person or group of Persons acting in concert owning in excess of 50% of the outstanding voting power of the Company or (d) the voluntarily or involuntarily dissolution or liquidation of the Company or winding up of the Company's affairs, or the taking by the Company of any action to effect any of the foregoing.

(b) " Person " means a legal person, including any individual, corporation, estate, partnership, joint venture, association, joint-stock company, company, limited liability company, trust, unincorporated association or any other entity of whatever nature.

* * * * * * * *

IN WITNESS WHEREOF, the parties have executed and delivered this Agreement as of the date first above written.

	VDF FUTURECEUTICALS, INC.


	By:	/s/ J. Randal Wexler
		Name: J. Randal Wexler
		Title: Vice President and General Counsel



	KONARED CORPORATION


	By:	/s/ Kyle Redfield
		Name: Kyle Redfield
		Title: Chief Executive Officer