UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 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)
December 12,
2017
LEVEL BRANDS, INC.
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(Exact name of registrant as specified in its charter)
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North Carolina
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001-38299
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47-3414576
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(State or other jurisdiction of incorporation or
organization)
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(Commission File Number)
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(I.R.S. Employer Identification No.)
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4521 Sharon Road, Suite 407, Charlotte, NC 28211
(Address of principal executive offices)(Zip Code)
Registrant's
telephone number, including area code
:
(704) 445-5800
not applicable
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(Former name or former address, if changed since last
report)
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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 (see General Instruction A.2.
below):
☐
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 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 ☑
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|
If an
emerging growth company, indicate by checkmark 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
December 11, 2017 Level Brands, Inc. entered into a Revolving Line
of Credit Loan Agreement with Kure Corp., pursuant to which we
agreed to lend Kure Corp. up to $500,000 to be used for the
purchase of prefabricated intermodal container building systems.
This credit line was provided in connection with Kure Corp.'s
recent
Master Purchase
Agreement with SG Blocks, Inc. for the purchase of 100 repurposed
shipping containers for its Kure Vape Pod™ initiative.
Previously, in March 2017 our subsidiary,
I | M 1, LLC,
granted Kure Corp. a non-transferrable license to
use the I'M1 marks solely for the sale, marketing and distribution
of vaping liquids and vaping products through certain specified
channels of distribution in the United States and from time to time
we have provided various advisory services to Kure Corp.
Furthermore, in August 2017
we were engaged by Kure to serve
as an advisor to Kure Corp. and provide certain specified advisory
services to it i
n consideration
of
400,000 shares of Kure Corp.’s common stock, which
was valued at $200,000, and $200,000 in cash
.
Most recently, effective December 11, 2017 we
entered into a services agreement with Kure Corp.
to
facilitate the “Vape Pod” transaction with the modular
building systems vendor, SG Blocks, Inc., which is also a client of
our company. Under the terms of this agreement we also agreed to
facilitate the introduction to third parties in connection with
Kure Corp.'s initiative to establish Vape Pod's at U.S. military
base retail locations and advising and aid in site selection for
Kure retail stores on military bases and adjoining convenience
stores, gas stations, and other similar retail properties utilizing
Kure Corp.'s retail Vape Pod concept, among other services. As
compensation for this recent agreement, we were issued 400,000
shares of Kure Corp.'s common stock which was valued at
$200,000.
Under
the terms of the Revolving Line of Credit Loan Agreement, Kure
Corp. issued us a $500,000 principal amount secured promissory
note, which bears interest at 8% per annum, and which matures on
the earlier of one year from the issuance date or when Kure Corp.
receives gross proceeds of at least $2,000,000 from the sale of its
equity securities. As collateral for the repayment of the loan,
pursuant to a Security Agreement we were granted a first position
security interest in Kure Corp.'s inventory, accounts and accounts
receivable. Our CEO and Chairman is the past Chairman of Kure Corp.
and currently a minority shareholder of Kure Corp. Level Brands is
also a shareholder of Kure Corp. Therefore due to the series of
transactions by and between Level Brands, Inc. and Kure Corp., Kure
Corp. is deemed to be a related party.
The
description of the transactions contemplated by the August 2017
advisory agreement, the November 2017 services agreement, Revolving
Line of Credit Loan Agreement and Security Agreement set forth
herein do not purport to be complete and are each qualified in its
entirety by reference to the full text of the exhibits filed
herewith and incorporated by this reference.
Item 7.01.
Financial Statement and Exhibits.
On
December 12, 2017, Level Brands, Inc. and Kure Corp. issued a joint
press release announcing the Master Purchase Agreement with SG
Blocks, Inc. and the extension of the $500,000 credit line by Level
Brands, Inc. to Kure Corp. A copy of this press release is
furnished as Exhibit 99.1 to this report.
Pursuant to General
Instruction B.2 of Form 8-K, the information in this Item 7.01 of
Form 8-K, including Exhibit 99.1, is being furnished and shall not
be deemed “filed” for the purposes of Section 18 of the
Securities Exchange Act of 1934 or otherwise be subject to the
liabilities of that section, nor is it incorporated by reference
into any filing of Level Brands, Inc. under the Securities Act of
1933 or the Securities Exchange Act of 1934, whether made before or
after the date hereof, regardless of any general incorporation
language in such filing.
Item 9.01.
Financial Statement and Exhibits.
(d)
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Exhibits:
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Form of
Agreement dated August 1, 2017 by and between Level Brands, Inc.
and Kure Corp.*
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Form of
Agreement dated December 12, 2017 by and between
Level Brands, Inc. and Kure Corp. *
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Form of
Revolving Line of Credit Loan Agreement dated
December 12, 2017 by and between Level Brands, Inc. and Kure
Corp.*
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Form of
Security Agreement dated December 12, 2017 by and
between Level Brands, Inc. and Kure Corp.*
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Form of
Promissory Note in the principal amount of $500,000
dated December 12, 2017 due from Kure Corp.*
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Press
Release dated December 12, 2017*
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*
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filed
herewith
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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.
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LEVEL BRANDS,
INC.
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Date: December 12,
2017
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By:
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/s/
Mark Elliott
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Chief
Financial Officer and Chief Operating
Officer
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Exhibit 10.62
August
1, 2017
Mr.
Craig Brewer
Chief
Executive Officer
Kure
Corp
Westinghouse
Blvd
Charlotte,
NC
Re:
Advisory Agreement
Dear
Mr. Brewer:
Pursuant
to this advisory agreement (“Agreement”) Kure Corp a
Florida corporation (the “Client”) has agreed to engage
Level Brands Inc, a North Carolina company (“LEVEL”),
on a non-exclusive basis, to perform services related to business
advisory matters pursuant to the terms and conditions set forth
herein.
1.
Services
. LEVEL shall act as
advisor to the Client and perform, as requested by the Client, the
following services (the “Services”):
a.
for the conversion
of approximately $2 million in franchise store operations into
company stores;
b.
for the conversion
of approximately $1.3 million of debt into common
stock;
c.
for the conversion
of approximately $1.7 million preferred shares into common
stock;
d.
helping the company
prepare its audited financial statements;
e.
the implementation
of a strategic plan for the Client, with a view towards enabling
the Client to achieve its financial goals, marketing, business
development with respect to Reg A+ offering in the amount of $10
million.
2.
Performance of Services
. LEVEL
shall be obligated to provide the Services as and when requested by
the Client and shall not be authorized or obligated to perform any
services on LEVEL’s own initiative. The services shall be
performed reasonably promptly after Client’s request,
consistent with LEVEL’s availability. It is understood that
the Services to be provided hereunder are not exclusive to the
Client and LEVEL has other business obligations, including acting
as consultant for other companies, provided, however, that LEVEL
shall not provide services to any potential or actual competitor of
the Client during the Term (as hereinafter defined) of this
Agreement.
3.
Relationship of the Parties
.
LEVEL shall be, and at all times during the Term of the Agreement,
remain an independent contractor. As such, LEVEL shall determine
the means and methods of performing the Services hereunder and
shall render the Services as such places it determines. The Client
shall pay all reasonable costs and expenses incurred by LEVEL in
the performance of its duties hereunder, provided, however, such
costs and expenses shall not exceed $2500.00 without the
Client’s prior written approval.
4.
Assurances
. Client acknowledges
that all options and advices (written or oral) given by LEVEL to
the Client in connection with this Agreement are intended solely
for the benefit and use of Client, and Client agrees that no person
or entity other than the Client shall be entitled to make use of or
rely upon the advice of LEVEL to be given hereunder. Furthermore,
no such opinion or advice given by LEVEL shall be used at any time,
in any manner or for any purpose, and shall not be reproduced,
disseminated, quoted or referred to at any time, in any manner or
for any purpose, except as may be contemplated herein. Client shall
not make any public references to LEVEL without LEVEL’s prior
written consent or as required by applicable law.
5.
Compensation
. LEVEL shall
receive fee of $200,000, for the services with respect to Sections
1a, 1b and 1c above which shall be completed by September 30, 2017.
This fee shall be paid in the form of 400,000 shares of Kure Corp.
common stock, valued at the same price as the terms of conversion
of franchises, debt and preferred shares, which is hereby
established at $.50 per share. LEVEL shall receive fee of $200,000,
for the services with respect to Sections 1d, and 1e above which
shall be completed by June 30, 2018. This fee shall be due in cash
and shall be payable as services are rendered and agreed to by both
parties.
6.
Additional Services
. Should
Client desire LEVEL to perform additional services not outlined
herein, Client may make such request to LEVEL in writing. LEVEL may
agree to perform those services at its sole discretion. However,
any additional services performed by LEVEL may require an
additional compensation schedule to be mutually agreed upon prior
to rendering such services.
7.
Term
. This Agreement shall be
binding upon all parties when executed by the Client and remain in
effect until June 30, 2018, unless otherwise mutually agreed upon
in writing by Client and LEVEL (the
“Term”).
8.
Due Diligence /
Disclosure
.
a.
Client recognizes
and confirms that, in advising Client and in fulfilling its
retention hereunder, LEVEL will use and rely upon data, material
and other information furnished to it by Client. Client
acknowledges and agrees that in performing its Services under this
agreement, LEVEL may rely upon the data, material and other
information supplied by Client without independently verifying the
accuracy, completeness or veracity of it.
b.
Except as
contemplated by the terms hereof or as required by applicable law,
LEVEL shall keep confidential, indefinitely, all non-public
information provided to it by Client, and shall not disclose such
information to any third party without Client’s prior written
consent, other than such of its employees and advisors as LEVEL
reasonably determines to have a need to know.
a.
Client shall
indemnify and hold LEVEL, its officers, directors, employees,
agents, and affiliates, harmless against any and all liabilities,
claims, lawsuits, including any and all awards and/or judgments to
which it may become subject under the Act or the Securities
Exchange Act of 1934, as amended (the “Exchange Act”)
or any other federal or state statute, at common law or otherwise,
insofar as said liabilities, claims and lawsuits, (including awards
and /or judgments) arise out of or are in connection with the
Services rendered by LEVEL in connection with this Agreement,
except for any liabilities, claims, and lawsuits (including awards,
judgments and related costs and expenses), arising out of acts or
omissions of LEVEL. In addition, the Client shall indemnify and
hold LEVEL harmless against any and all reasonable costs and
expenses, including reasonable attorney fees, incurred or relating
to the foregoing. If it is judicially determined that Client will
not be responsible for any liabilities, claims and lawsuits or
expenses related thereto, the indemnified party, by his or its
acceptance of such amounts, agrees to repay Client all amounts
previously paid by client to the indemnified person and will pay
all costs of collection thereof, including but not limited to
reasonable attorney’s fees related thereto. LEVEL shall give
Client prompt notice of any such liability, claim or lawsuit, which
LEVEL contends is the subject matter of Client’s
indemnification and LEVEL thereupon shall be granted the right to
take any and all necessary proper action, at its sole cost and
expense, with respect to such liability, claim and lawsuit,
including the right to settle, compromise and dispose of such
liability, claim or lawsuit, excepting there from any and all
proceedings or hearings before any regulatory bodies and / or
authorities.
b.
LEVEL shall
indemnify and hold Client and its directors, officers, employees
and agents harmless against any and all liabilities, claims and
lawsuits, including and all award and/ or judgments to which it may
become subject under the Act, Exchange Act or any other federal or
state statute, at common law or otherwise, insofar as said
liabilities, claims and lawsuits (including awards and/ or
judgments) that may arise out of or are based upon LEVEL’s
gross negligence or willful misconduct, or any untrue statement or
alleged untrue statement of a material fact or omission of a
material fact required to be slated or necessary to make the
statement provided by LEVEL not misleading, which statement or
omission was made in reliance upon information furnished in writing
to Client by or on behalf of LEVEL for inclusion in any
registration statement or prospectus or any amendment or supplement
thereto in connection with any transaction to which the Agreement
applies. In addition, LEVEL shall also indemnify and hold Client
harmless against any and all costs and expenses, including
reasonable attorney fees, incurred or relating to the foregoing.
Client shall give LEVEL prompt notice of any such liability, claim
or lawsuit which Client contends is the subject matter of
LEVEL’s indemnification and LEVEL thereupon shall be granted
the right to take any and all necessary proper action, at its sole
cost and expense, with respect to such liability, claim and
lawsuit, including the right to settle, compromise or dispose of
such liability, claim or lawsuit, excepting therefrom any and all
proceedings or hearings before any regulatory bodies and/ or
authorities.
c.
The indemnification
provisions contained in this Section are in addition to any other
rights or remedies which either party hereto may have with respect
to the other or hereunder
a.
Entire Agreement.
This between Client and LEVEL constitutes the entire agreement
between and understandings of the parties hereto, and supersedes
any and all previous agreements and understandings, whether oral or
written, between the parties with respect to the matters set forth
herein.
b.
Notice. Any notice
or communication permitted or required hereunder shall be in
writing and deemed sufficiently given if hand-delivered: (i) five
(5) calendar days after being sent postage prepaid by registered
mail, return receipt requested; or (ii) one (1) business day after
being sent via facsimile with confirmatory notice by U.S. mail, to
the respective parties as set forth above, or to such other address
as either party may notify the other in writing.
c.
Binding Nature.
This Agreement shall be binding upon and inure the benefit of each
of the parties hereto and their respective successors, legal
representatives and assigns. All materials generated pursuant to
this Agreement or otherwise produce by LEVEL for and on behalf of
Client during the Term of this Agreement shall be the sole and
exclusive property of Client.
d.
Counterparts. This
Agreement may be executed by any number of counterparts, each of
which together shall constitute the same original
document.
e.
Amendments. No
provisions of the Agreement may be amended, modified or waived,
except in writing signed by all parties hereto.
f.
Assignment. This
Agreement cannot be assigned or delegated, by either party, without
the prior written consent of the party to be charged with such
assignment or delegation, and any unauthorized assignments shall be
null and void without effect and shall immediately terminate the
Agreement.
g.
Applicable Law.
This Agreement shall be construed in accordance with and governed
by the laws of the State of North Carolina, without giving effect
to its conflict of law principles. The parties hereby agree that
any dispute(s) or claim(s) with respect to this Agreement of the
performance of any obligations thereunder, shall be settled by
arbitration and commenced and adjudicated under the rules of the
American Arbitration Association. The arbitration shall take place
in Charlotte, North Carolina if commenced by either party. The
arbitration shall be conducted before a panel of three (3)
arbitrators, one appointed by each of the parties and the third
selected by the two (2) appointed arbitrators. The arbitrators in
any arbitration proceeding to enforce the Agreement shall allocate
reasonable attorney’s fees, among one or both parties in such
proportion as the arbitrators shall determine represents each
party’s liability hereunder. The decision of the arbitrator
shall be final and binding and may be entered into any court having
proper jurisdiction to obtain a judgment for the prevailing party.
In any proceeding to enforce an arbitration award, the prevailing
party in such proceeding shall have the right to collect from the
non-prevailing party, its reasonable fees and expenses incurred in
enforcing the arbitration award (including, without limitation,
reasonable attorney’s fees).
If you
are in agreement with the foregoing, please execute two (2) copies
of this Agreement in the space provided below and return them to
the undersigned.
Very
truly yours,
Level
Brands, Inc.
By:
_____________________________
Mark
Elliott
CFO
Kure
Corp
By:
_____________________________
Craig
Brewer
CEO
Exhibit 10.63
December
12, 2017
Mr.
Craig Brewer
Chief
Executive Officer
Kure
Corp
14400
Westinghouse Blvd, Ste. L
Charlotte,
NC
Re:
Services Agreement
Dear
Mr. Brewer:
Pursuant
to this services agreement (“Agreement”) Kure Corp., a
Florida corporation (the “Client”) has agreed to engage
Level Brands Inc, a North Carolina corporation
(“LEVEL”), on a non-exclusive basis, to perform
services related Kure’s business.
Generally
speaking, LEVEL intends to work with Kure to develop an overall
strategy to enhance Kure’s brand and provide low cost access
to retail market share and demographics. In addition, LEVEL can
provide critical introductions with the military for opening up
retail stores on military bases and other locations, such as
convenience stores and gas stations. Although LEVEL can provide
such strategic advice and introductions to new markets, Kure will
ultimately be responsible for the implementation of these
strategies and relationships.
1.
Services
. LEVEL shall act as
advisor to the Client and perform, as requested by the Client, the
following services (the “Services”) during the month of
December 2017:
a.
Facilitate the
“Vape Pod” transaction with the modular building
systems vendor, SG Blocks, Inc., and aid in the negotiation of that
vendor relationship;
b.
Facilitate the
introduction with LEVEL’s contacts relating to U.S. military
base retail locations, as well as other non-military Vape Pod
retail locations throughout the country;
c.
Aid in site
selection for Kure retail stores on military bases and adjoining
convenience stores, gas stations, and other similar retail
properties utilizing this retail Vape Pod concept; and
d.
Advise Client in
connection with initial project funding for the Vape Pod
concept.
2.
Performance of Services
. LEVEL
shall be obligated to provide the Services as and when requested by
the Client and shall not be authorized or obligated to perform any
services on LEVEL’s own initiative. The services shall be
performed reasonably promptly after Client’s request,
consistent with LEVEL’s availability. It is understood that
the Services to be provided hereunder are not exclusive to the
Client and LEVEL has other business obligations, including acting
as consultant for other companies, provided, however, that LEVEL
shall not provide services to any potential or actual competitor of
the Client during the Term (as hereinafter defined) of this
Agreement.
3.
Relationship of the Parties
.
LEVEL shall be, and at all times during the Term of the Agreement,
remain an independent contractor. As such, LEVEL shall determine
the means and methods of performing the Services hereunder and
shall render the Services as such places it determines. The Client
shall pay all reasonable costs and expenses incurred by LEVEL in
the performance of its duties hereunder, provided, however, such
costs and expenses shall not exceed $2500.00 without the
Client’s prior written approval.
4.
Assurances
. Client acknowledges
that all options and advices (written or oral) given by LEVEL to
the Client in connection with this Agreement are intended solely
for the benefit and use of Client, and Client agrees that no person
or entity other than the Client shall be entitled to make use of or
rely upon the advice of LEVEL to be given hereunder. Furthermore,
no such opinion or advice given by LEVEL shall be used at any time,
in any manner or for any purpose, and shall not be reproduced,
disseminated, quoted or referred to at any time, in any manner or
for any purpose, except as may be contemplated herein. Client shall
not make any public references to LEVEL without LEVEL’s prior
written consent or as required by applicable law.
5.
Compensation
. LEVEL shall
receive fee of $200,000, for the services with respect to Section 1
above which shall be completed by December 31, 2017. This fee shall
be paid in the form of 400,000 shares of Kure Corp. common
stock.
6.
Additional Services
. Should
Client desire LEVEL to perform additional services not outlined
herein, Client may make such request to LEVEL in writing. LEVEL may
agree to perform those services at its sole discretion. However,
any additional services performed by LEVEL may require an
additional compensation schedule to be mutually agreed upon prior
to rendering such services.
7.
Term
. This Agreement shall be
binding upon all parties when executed by the Client and remain in
effect until December 31, 2017, unless otherwise mutually agreed
upon in writing by Client and LEVEL (the
“Term”).
8.
Due Diligence /
Disclosure
.
a.
Client recognizes
and confirms that, in advising Client and in fulfilling its
retention hereunder, LEVEL will use and rely upon data, material
and other information furnished to it by Client. Client
acknowledges and agrees that in performing its Services under this
agreement, LEVEL may rely upon the data, material and other
information supplied by Client without independently verifying the
accuracy, completeness or veracity of it.
b.
Except as
contemplated by the terms hereof or as required by applicable law,
LEVEL shall keep confidential, indefinitely, all non-public
information provided to it by Client, and shall not disclose such
information to any third party without Client’s prior written
consent, other than such of its employees and advisors as LEVEL
reasonably determines to have a need to know.
a.
Client shall
indemnify and hold LEVEL, its officers, directors, employees,
agents, and affiliates, harmless against any and all liabilities,
claims, lawsuits, including any and all awards and/or judgments to
which it may become subject under the Act or the Securities
Exchange Act of 1934, as amended (the “Exchange Act”)
or any other federal or state statute, at common law or otherwise,
insofar as said liabilities, claims and lawsuits, (including awards
and /or judgments) arise out of or are in connection with the
Services rendered by LEVEL in connection with this Agreement,
except for any liabilities, claims, and lawsuits (including awards,
judgments and related costs and expenses), arising out of acts or
omissions of LEVEL. In addition, the Client shall indemnify and
hold LEVEL harmless against any and all reasonable costs and
expenses, including reasonable attorney fees, incurred or relating
to the foregoing. If it is judicially determined that Client will
not be responsible for any liabilities, claims and lawsuits or
expenses related thereto, the indemnified party, by his or its
acceptance of such amounts, agrees to repay Client all amounts
previously paid by client to the indemnified person and will pay
all costs of collection thereof, including but not limited to
reasonable attorney’s fees related thereto. LEVEL shall give
Client prompt notice of any such liability, claim or lawsuit, which
LEVEL contends is the subject matter of Client’s
indemnification and LEVEL thereupon shall be granted the right to
take any and all necessary proper action, at its sole cost and
expense, with respect to such liability, claim and lawsuit,
including the right to settle, compromise and dispose of such
liability, claim or lawsuit, excepting there from any and all
proceedings or hearings before any regulatory bodies and / or
authorities.
b.
LEVEL shall
indemnify and hold Client and its directors, officers, employees
and agents harmless against any and all liabilities, claims and
lawsuits, including and all award and/ or judgments to which it may
become subject under the Act, Exchange Act or any other federal or
state statute, at common law or otherwise, insofar as said
liabilities, claims and lawsuits (including awards and/ or
judgments) that may arise out of or are based upon LEVEL’s
gross negligence or willful misconduct, or any untrue statement or
alleged untrue statement of a material fact or omission of a
material fact required to be slated or necessary to make the
statement provided by LEVEL not misleading, which statement or
omission was made in reliance upon information furnished in writing
to Client by or on behalf of LEVEL for inclusion in any
registration statement or prospectus or any amendment or supplement
thereto in connection with any transaction to which the Agreement
applies. In addition, LEVEL shall also indemnify and hold Client
harmless against any and all costs and expenses, including
reasonable attorney fees, incurred or relating to the foregoing.
Client shall give LEVEL prompt notice of any such liability, claim
or lawsuit which Client contends is the subject matter of
LEVEL’s indemnification and LEVEL thereupon shall be granted
the right to take any and all necessary proper action, at its sole
cost and expense, with respect to such liability, claim and
lawsuit, including the right to settle, compromise or dispose of
such liability, claim or lawsuit, excepting therefrom any and all
proceedings or hearings before any regulatory bodies and/ or
authorities.
c.
The indemnification
provisions contained in this Section are in addition to any other
rights or remedies which either party hereto may have with respect
to the other or hereunder
a.
Entire Agreement.
This between Client and LEVEL constitutes the entire agreement
between and understandings of the parties hereto, and supersedes
any and all previous agreements and understandings, whether oral or
written, between the parties with respect to the matters set forth
herein.
b.
Notice. Any notice
or communication permitted or required hereunder shall be in
writing and deemed sufficiently given if hand-delivered: (i) five
(5) calendar days after being sent postage prepaid by registered
mail, return receipt requested; or (ii) one (1) business day after
being sent via facsimile with confirmatory notice by U.S. mail, to
the respective parties as set forth above, or to such other address
as either party may notify the other in writing.
c.
Binding Nature.
This Agreement shall be binding upon and inure the benefit of each
of the parties hereto and their respective successors, legal
representatives and assigns. All materials generated pursuant to
this Agreement or otherwise produce by LEVEL for and on behalf of
Client during the Term of this Agreement shall be the sole and
exclusive property of Client.
d.
Counterparts. This
Agreement may be executed by any number of counterparts, each of
which together shall constitute the same original
document.
e.
Amendments. No
provisions of the Agreement may be amended, modified or waived,
except in writing signed by all parties hereto.
f.
Assignment. This
Agreement cannot be assigned or delegated, by either party, without
the prior written consent of the party to be charged with such
assignment or delegation, and any unauthorized assignments shall be
null and void without effect and shall immediately terminate the
Agreement.
g.
Applicable Law.
This Agreement shall be construed in accordance with and governed
by the laws of the State of North Carolina, without giving effect
to its conflict of law principles. The parties hereby agree that
any dispute(s) or claim(s) with respect to this Agreement of the
performance of any obligations thereunder, shall be settled by
arbitration and commenced and adjudicated under the rules of the
American Arbitration Association. The arbitration shall take place
in Charlotte, North Carolina if commenced by either party. The
arbitration shall be conducted before a panel of three (3)
arbitrators, one appointed by each of the parties and the third
selected by the two (2) appointed arbitrators. The arbitrators in
any arbitration proceeding to enforce the Agreement shall allocate
reasonable attorney’s fees, among one or both parties in such
proportion as the arbitrators shall determine represents each
party’s liability hereunder. The decision of the arbitrator
shall be final and binding and may be entered into any court having
proper jurisdiction to obtain a judgment for the prevailing party.
In any proceeding to enforce an arbitration award, the prevailing
party in such proceeding shall have the right to collect from the
non-prevailing party, its reasonable fees and expenses incurred in
enforcing the arbitration award (including, without limitation,
reasonable attorney’s fees).
If you
are in agreement with the foregoing, please execute two (2) copies
of this Agreement in the space provided below and return them to
the undersigned.
Very
truly yours,
Level
Brands, Inc.
By:
_____________________________
Martin
A. Sumichrast, CEO
Kure
Corp
By:
_____________________________
Craig
Brewer, CEO
EXHIBIT 10.64
REVOLVING LINE OF CREDIT
LOAN AGREEMENT
(ACCOUNTS
RECEIVABLE AND INVENTORY)
This
Revolving Line of Credit Loan Agreement (this “
Agreement
”) is entered into by and
between Kure Corp., a Florida corporation (“
Borrower
”) and Level Brands, Inc.,
a North Carolina corporation (“
Lender
”) as of December
12
th,
2017.
RECITALS
Borrower desires to
obtain from Lender a revolving line of credit (“
Loan
”) and Lender is willing to
make the Loan, with the proceeds to be used to finance, in part,
Borrower’s purchase of certain prefabricated intermodal
container building systems in order to increase Borrower’s
Vape and Vape related products market share.
AGREEMENT
NOW,
THEREFORE in consideration of the premises and the mutual promises
herein contained and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:
1.
LOAN.
1.1
REVOLVING LINE OF
CREDIT. Subject to the terms and conditions contained herein and in
the other documents, instruments and agreements executed in
connection with the Loan and the security therefor
(“
Loan
Documents
”), Lender will establish for Borrower the
Loan as a revolving line of credit against which Lender will make
advances (“
Advances
”) from time to time for
the purpose of providing working capital to Borrower. Subject to
the terms hereof, Borrower shall have the right to obtain Advances,
repay Advances and obtain additional Advances; however, all of the
Advances hereunder shall be viewed as a single loan. At no time
shall the unpaid principal balance of the Loan exceed Five Hundred
Thousand Dollars ($500,000) (“
Maximum Amount
”).
1.2
ADVANCES. Subject
to the terms and conditions hereof, Advances of the Loan will be
made in amounts not to exceed an aggregate of the Maximum
Amount.
1.3
NOTE. The Loan
shall be evidenced by a promissory note (“
Note
”) of even date herewith in a
form prepared and approved by Lender in the Maximum Amount, payable
in accordance with the terms thereof. Interest on the principal
amount outstanding from time to time shall be charged as provided
in the Note and should such rate of interest as calculated
thereunder exceed that allowed by law, the applicable rate of
interest will be the maximum rate of interest allowed by applicable
law.
1.4
PREPAYMENTS. If for
any reason the aggregate principal amount of the Loan outstanding
at any time shall exceed the Maximum Amount to be borrowed in
accordance with Section 1.2 hereof, Borrower, without notice or
demand, shall immediately make a principal payment to Lender in an
amount equal to such excess plus accrued and unpaid interest
hereon. Borrower may from time to time, prepay all or part of the
outstanding principal balance of the Loan.
2.
SECURITY.
As security
for the payment of the Note, the Loan, and all other liabilities
and obligations of Borrower to Lender, now existing or hereafter
created, Borrower shall grant to Lender a security interest in all
of Borrower’s inventory, accounts receivable, rights to
payment and such other property (“
Property
”), as more particularly
described in one or more security agreements (“
Security Agreements
”) executed by
Borrower and delivered to Lender in form and substance satisfactory
to Lender, in its sole and absolute discretion. The Security
Agreements shall grant to Lender a security interest in and to the
Property, except as otherwise expressly provided
therein.
3.
ADVANCES.
3.1
CONDITIONS
PRECEDENT TO ADVANCES. Lender shall have no obligation to make any
Advance, as determined by Lender in its sole and absolute
discretion.
3.2
REQUEST FOR
ADVANCES. Advances may be made by Lender at the oral or written
request of authorized persons, either one acting alone, who are
authorized to request Advances and direct disposition of any such
Advances until written notice of the revocation of such authority
is received from Borrower by Lender. Each request by Borrower for
an Advance shall constitute a reaffirmation, as of the date of such
request, of all of the representations and warranties of Borrower
contained in this Agreement and in the other Loan
Documents.
3.3
NO WAIVER. No
Advance shall constitute a waiver of any of the conditions to any
further Advances nor, in the event Borrower is unable to satisfy
any such condition, shall any such Advance have the effect of
precluding Lender from thereafter declaring such inability to be an
Event of Default (as hereinafter defined).
4.
STOCK ISSUANCE FEE.
As additional consideration for Lender’s commitment to make
Advances, Borrower agrees to issue to Lender, which shall be
non-refundable to Borrower, shall be held and retained by Lender as
its sole property and shall not be applied to any payments due
under the Loan Documents, one hundred thousand (100,000) shares of
Common Stock of Borrower.
5.
EVENTS OF
DEFAULT.
5.1
EVENTS OF DEFAULT.
The occurrence of one or more of the following events shall
constitute an Event of Default under this Agreement:
(a)
There shall occur
an event of default under any of the Loan Documents;
(b)
If any
representation or warranty made by Borrower to Lender contained
herein or in any of the other Loan Documents proves to have been
untrue in any material respect when made; or
(c)
Borrower shall be
in default in the payment or performance of any material obligation
under any indenture, contract, mortgage, deed of trust or other
agreement or instrument to which Borrower is a party or by which it
is bound.
6.
REMEDIES OF LENDER
UPON DEFAULT.
6.1
REMEDIES. After any
Event of Default has occurred and is continuing for a period of 10
days thereafter, Lender may, without presentment, demand, protest
or further notice of any kind (all of which are hereby expressly
waived) and, notwithstanding the provisions contained in any other
document or instrument executed or to be executed by Borrower to
Lender hereunder or contained in any other agreement, take any one
or more of the following actions:
(a)
Declare the entire
principal and any accrued interest on the Loan, together with all
costs and expenses, to be immediately due and payable, and to
enforce payment thereof by any means permitted by law or in
equity;
(b)
Without
accelerating payment, enforce the payment of sums of principal and
interest then due (including any penalty interest or late payment
charges);
(c)
Require Borrower to
take or refrain from taking any action which may be necessary to
cure such Event of Default and to obtain affirmative or negative
injunctions or restraining orders with respect
thereto;
(d)
Obtain the
appointment of a receiver of the business and assets of
Borrower;
(e)
File suit for any
sums owing or for damages; and
(f)
Exercise any other
remedy or right provided in law or in equity or permitted under
this Agreement, the Security Agreements or any of the other Loan
Documents.
6.2
REMEDIES
CUMULATIVE. Any and all remedies conferred upon Lender shall be
deemed cumulative with, and nonexclusive of any other remedy
conferred hereby or by law, and Lender in the exercise of any one
remedy shall not be precluded from the exercise of any
other.
7.
WAIVER.
Any
waiver of any of the terms of this Agreement by Lender shall not be
construed as a waiver of any other terms of this Agreement, and no
waiver shall be effective unless made in writing. The failure of
Lender to exercise any right with respect to the declaration of any
default shall not be deemed or construed to constitute a waiver by,
or to preclude Lender from exercising any right with respect to
such default at a later date or with respect to any subsequent
default by Borrower.
8.
NOTICES.
Any
notices required or permitted to be given pursuant to the Loan
Documents shall be in writing and shall be given by personal
delivery or by mailing the same by United States mail, postage
prepaid, to the other party’s last known address. Any such
notice shall be deemed received for purposes of this Agreement upon
delivery if given by personal delivery or ten (10) days after the
mailing thereof if given by mail. If either party desires to change
the address to which notices are to be sent it shall do so in
writing and deliver the same to the other party in accordance with
the notice provisions set forth above.
9.
MISCELLANEOUS.
9.1
PARTIES. This
Agreement is made solely between Borrower and Lender, no other
person shall have any right of action hereunder. The parties
expressly agree that no person shall be a third-party beneficiary
to this Agreement.
9.2
INDEMNITY. Borrower
agrees to and shall indemnify, hold harmless and defend Lender from
any liability, claims or losses resulting from the disbursement of
the proceeds of the Loan or from the condition of the Property
whether arising during or after the term of the Loan. This
provision shall survive repayment of the Loan and shall continue in
full force and effect so long as the possibility of such liability,
claims or losses exists.
9.3
ENTIRE AGREEMENT.
This Agreement, together with all other Loan Documents, constitutes
the entire agreement of the parties hereto and thereto, and no
prior agreement or understanding with respect to the Loan, whether
written or oral and including, but not limited to, any loan
commitment issued by Lender to Borrower, shall be of any further
force or effect, all such other prior agreements and commitments
having been superseded in their entirety by the Loan
Documents.
9.4
ASSIGNMENT. This
Agreement shall inure to the benefit of and be binding upon the
parties hereto and their respective executors, administrators,
heirs, successors and assigns; provided, however, that neither this
Agreement nor any rights or obligations hereunder shall be
assignable by Borrower without the prior express written consent of
Lender first had any obtained, and any purported assignment made in
contravention hereof shall be void. Lender may assign any part of
or all of the Loan and its rights and obligations hereunder at any
time in its sole discretion. Lender may participate all or any
portion of the Loan to such other party or parties as Lender shall
select.
9.5
GOVERNING LAW. This
Agreement and each of the Loan Documents shall be construed in
accordance with and governed by the internal law, and not the law
of conflicts, of the State of North Carolina.
9.6
TIME. Time is of
the essence hereof.
9.7
SEVERABILITY. If
any term or provision of this Agreement of any other Loan Document,
or the application thereof to any circumstance, shall be invalid,
illegal or unenforceable to any extent, such term or provision
shall not invalidate or render unenforceable any other term or
provision of this Agreement or any other Loan Document, or the
application of such term or provision to any other circumstance. To
the extent permitted by law, the parties hereto hereby waive any
provision of law that renders any term or provision hereof invalid
or unenforceable in any respect.
IN WITNESS WHEREOF
, the parties have
executed this Agreement to be effective as of the date first above
written.
Level
Brands, Inc.
Martin
A. Sumichrast, CEO
Kure
Corp.
Craig
Brewer, CEO
Exhibit 10.65
SECURITY AGREEMENT
This
SECURITY AGREEMENT
dated as
of December 12
th
, 2017 by Kure
Corp., a Florida corporation (“
Borrower
”), in favor of Level
Brands, Inc., a North Carolina corporation (“
Secured Party
”).
Borrower has
concurrently herewith entered into the Credit Agreement (as defined
below) with the Secured Party. As a condition precedent to the
Secured Party’s acceptance of such Credit Agreement, Borrower
has agreed to grant the Secured Party a continuing security
interest in and to the Collateral (as defined below) to secure the
Credit Agreement. Accordingly, the parties agree as
follows:
ARTICLE I
DEFINITIONS
Section 1.01
Definitions
.
The following terms, as used herein, have the following respective
meanings:
(a) “Collateral”
means, with respect to the Loan (as defined in the Credit
Agreement) all of Borrower’s Inventory, Accounts and Accounts
Receivables (as those terms are defined under or contemplated in
the UCC).
(b) “Credit
Agreement” means that certain Revolving Line of Credit
Agreement, dated of even date herewith and entered into between
Borrower and the Secured Party, including, without limitation, the
Note (as defined in the Credit Agreement), as the same may be
renewed, extended, modified or otherwise restructured from time to
time.
(c) “Event
of Default” has the meaning set forth in the Credit
Agreement.
(d) “Lien”
means any mortgage, pledge, security interest, encumbrance, lien or
charge of any kind.
(e) “Obligations”
means all principal and interest payable under the Credit Agreement
and all expenses as to which the Secured Party has a right to
reimbursement under this Security Agreement, including any and all
sums advanced to preserve the Collateral or to preserve its
security interests in the Collateral.
(f) “Person”
means an individual, a partnership, a corporation, an association,
a joint stock company, a trust, a joint venture, an unincorporated
organization or a governmental entity (or any department, agency or
political subdivision thereof).
(g) “Proceeds”
means all “proceeds” (as defined in Section 9-102 of
the UCC) and shall also mean and include all proceeds of, and all
other profits, products, rents or receipts, in whatever form,
arising from the collection, sale, lease, exchange, assignment,
licensing or other disposition of or other realization upon or
payment for the use of, Collateral, including, without limitation,
all claims of Borrower against third parties for loss of, damage to
or destruction of, or for proceeds payable under, or unearned
premiums with respect to, policies of insurance in respect of, any
Collateral, and any condemnation or requisition payments with
respect to any Collateral, in each case whether now existing or
hereafter arising.
(h) “Security
Agreement” means this Security Agreement, as the same may be
amended, supplemented or modified from time to time.
(i) “Secured
Party” has the meaning set forth in the recitals
hereto.
(j) “Security
Interests” means the security interests in the Collateral
granted under this Security Agreement securing the
Obligations.
(k) “UCC”
means the Uniform Commercial Code as in effect on the date hereof
in the State of North Carolina; provided that if by reason of
mandatory provisions of law, the perfection or the effect of
perfection or non-perfection of the Security Interest in any
Collateral is governed by the Uniform Commercial Code as in effect
in a jurisdiction other than North Carolina, “UCC”
means the Uniform Commercial Code as in effect in such other
jurisdiction for purposes of the provisions hereof relating to such
perfection or effect of perfection or non-perfection.
(l) “Borrower”
has the meaning set forth in the recitals hereto.
Section
1.02
UCC
Terms
.
Unless
otherwise defined herein, or unless the context otherwise requires,
all terms used herein which are defined in the UCC shall have the
meanings stated in the UCC.
Section
1.03
Terms
Generally
.
The
definitions in Section 1.01 shall apply equally to both the
singular and plural forms of the terms defined. Whenever the
context may require, any pronoun shall include the corresponding
masculine, feminine and neuter forms. The words
“include”, “includes” and
“including” shall be deemed to be followed by the
phrase “without limitation”. Unless otherwise expressly
provided herein, the word “day” means a calendar
day.
ARTICLE II
THE SECURITY INTERESTS
Section
2.01
Grant
of Security Interests
.
To secure the full and punctual
payment of the Obligations in accordance with the terms thereof,
and to secure the performance of all of the obligations of Borrower
hereunder, Borrower hereby assigns and pledges to the Secured
Party, and its successors and assigns, and grants to the Secured
Party, and its successors and assigns, security interests in the
Collateral.
Section
2.02
Security
Interests Absolute
.
All rights of the Secured Party, all security interests hereunder
and all obligations of Borrower hereunder are unconditional and
absolute and independent and separate from any other security for
or guaranty of the Obligations, whether executed by Borrower or any
other Person. Without limiting the generality of the foregoing, the
obligations of Borrower hereunder shall not be released, discharged
or otherwise affected or impaired by:
(a) any
extension, renewal, settlement, compromise, acceleration, waiver or
release in respect of any obligation of Borrower under the Credit
Agreement or the Obligations, by operation of law or
otherwise;
(b) any
release, non-perfection or invalidity of any direct or indirect
security for the Obligations, any sale, exchange, surrender,
realization upon, offset against or other action in respect of any
direct or indirect security for the Obligations or any release of
any other obligor in respect of the Obligations;
(c) the
existence of any claim, set-off or other right which Borrower may
have at any time against the Secured Party or any other Person,
whether in connection herewith or any unrelated
transaction;
(d) any
invalidity or unenforceability relating to or against Borrower or
the Secured Party for any reason of the Credit Agreement or any
other agreement or instrument evidencing or securing the
Obligations or any provision of applicable law or regulation
purporting to prohibit the payment by Borrower of the
Obligations;
(e) any
failure by the Secured Party: (i) to file or enforce a claim
against Borrower or its estate (in a bankruptcy or other
proceeding); (ii) to commence any action against Borrower; (iii) to
disclose to Borrower any facts which the Secured Party may now or
hereafter know with regard to Borrower; or (iv) to proceed with due
diligence in the collection, protection or realization upon any
collateral securing the Obligations; and
(f) any
other act or omission to act or delay of any kind by Borrower, the
Secured Party or any other Person or any other circumstance
whatsoever which might, but for the provisions of this clause,
constitute a legal or equitable discharge of Borrower’s
obligations hereunder; or
This
Security Agreement shall remain fully enforceable against Borrower
irrespective of any defenses that any other Person may have or
assert in respect of the Obligations, including, without
limitation, failure of consideration, breach of warranty, payment,
statute of frauds, statute of limitations, accord and satisfaction
and usury.
Section
2.03
Continuing
Liability of Borrower
.
The Security Interests are granted as
security only and shall not subject the Secured Party to, or
transfer or in any way affect or modify, any obligation or
liability of Borrower with respect to any of the Collateral or any
transaction in connection therewith.
ARTICLE IV
COVENANTS
Borrower covenants
and agrees that until the payment in full of all Obligations,
Borrower will comply with the following:
Section
4.01
Financing
Statements; Further Assurances
.
Borrower will, from time to time and
in such manner and form as the Secured Party may require, execute,
deliver, file and record any financing statement, specific
assignment, instrument, document, agreement or other paper and take
any other action (including, without limitation, any filings of
financing or continuation statements under the Uniform Commercial
Code) that from time to time may be necessary or desirable, or that
the Secured Party may request, in order to create, preserve,
perfect, confirm or validate the Security Interests or to enable
the Secured Party to obtain the full benefit of this Security
Agreement or to exercise and enforce any of its rights, powers and
remedies created hereunder or under applicable law with respect to
any of the Collateral. To the extent permitted by applicable law,
Borrower hereby authorizes the Secured Party to execute and file,
in the name of Borrower or otherwise and without the signature of
Borrower appearing thereon, such Uniform Commercial Code financing
statements or continuation statements as the Secured Party in its
sole discretion may deem necessary or appropriate to further
perfect or maintain the perfection of the Security Interests.
Borrower agrees that a carbon, photographic, photostatic or other
reproduction of this Security Agreement or of a financing statement
is sufficient as a financing statement.
Section
4.02
Disposition
of Collateral
.
Borrower will not sell, exchange, assign or otherwise dispose of,
or grant any option with respect to, any Collateral or create or
suffer to exist any Lien (other than the Security) on any
Collateral, other than in the ordinary course of
business.
ARTICLE V
GENERAL AUTHORITY; REMEDIES
Section
5.01
General
Authority
.
Borrower
hereby irrevocably appoints the Secured Party and any officer or
agent thereof as its true and lawful attorney-in-fact, with full
power of substitution, in the name of Borrower, for the sole use
and benefit of the Secured Party, but at Borrower’s expense,
to the extent permitted by law, to exercise at any time and from
time to time while an Event of Default has occurred and is
continuing under the Credit Agreement or the Obligations, all or
any of the following powers with respect to all or any of the
Collateral, all acts of such attorney being hereby ratified and
confirmed; and such power, being coupled with an interest, is
irrevocable until the Obligations are paid in full:
(a) to
take any and all appropriate action and to execute any and all
documents and instruments which may be necessary or desirable to
carry out the terms of this Security Agreement;
(b) to
receive, take, endorse, assign and deliver any and all checks,
credit agreements, drafts, acceptances, documents and other
negotiable and non-negotiable instruments taken or received by
Borrower as, or in connection with, the Collateral;
(c) to
commence, settle, compromise, compound, prosecute, defend or adjust
any claim, suit, action or proceeding with respect to, or in
connection with, the Collateral;
(d) to
sell, transfer, assign or otherwise deal in or with the Collateral
or the proceeds or avails thereof, as fully and effectually as if
the Secured Party were the absolute owner thereof; and
(e) to
do, at its option, but at the expense of Borrower, at any time or
from time to time, all acts and things which the Secured Party
deems necessary to protect or preserve the Collateral and to
realize upon the Collateral.
Except
as otherwise provided herein, Borrower hereby waives, to the extent
permitted by applicable law, notice and judicial hearing in
connection with the Secured Party’s taking possession or
disposition of any of the Collateral, including, without
limitation, any and all prior notice and hearing for any
prejudgment remedy or remedies and any such right which Borrower
would otherwise have under the Constitution or any statute of the
United States or of any state.
Section
5.02
Remedies
upon Event of Default
.
If an Event of Default shall have
occurred and be continuing under the Credit Agreement or the
Obligations, the Secured Party may, in addition to all other rights
and remedies granted to it in this Security Agreement and in any
other agreement securing, evidencing or relating to the
Obligations: (a) exercise all rights and remedies of a secured
party under the UCC (whether or not in effect in the jurisdiction
where such rights are exercised) and, in addition, (b) without
demand of performance or other demand or notice of any kind (except
as herein provided or as may be required by mandatory provisions of
law) to or upon Borrower or any other Person (all of which demands
and/or notices are hereby waived by Borrower), (i) apply all cash,
if any, then held by it as Collateral as specified herein and (ii)
if there shall be no such cash or if such cash shall be
insufficient to pay all the Obligations in full or cannot be so
applied for any reason, collect, receive, appropriate and realize
upon the Collateral and/or sell, assign, give an option or options
to purchase or otherwise dispose of and deliver the Collateral (or
contract to do so) or any part thereof at public or private sale,
at any office of the Secured Party or elsewhere in such manner as
is commercially reasonable and as the Secured Party may deem best,
for cash, on credit or for future delivery without assumption of
any credit risk and at such price or prices as the Secured Party
may deem satisfactory. The Secured Party may be the purchaser of
any or all of the Collateral so sold at any public sale (or, if the
Collateral is of a type customarily sold in a recognized market or
is of a type which is the subject of widely distributed standard
price quotations, at any private sale). Borrower will execute and
deliver such documents and take such other action as the Secured
Party deems necessary or advisable in order that any such sale may
be made in compliance with law.
Section
5.03
Other Rights of the
Secured Party
.
(a) The
Secured Party, instead of exercising the power of sale conferred
upon it pursuant to Section 5.02, may proceed by a suit or suits at
law or in equity to foreclose the Security Interests and sell the
Collateral, or any portion thereof, under a judgement or decree of
a court or courts of competent jurisdiction, and may in addition,
institute and maintain such suits and proceedings as it may deem
appropriate to protect and enforce the rights vested in it by this
Security Agreement.
(b) The
Secured Party shall, to the extent permitted by applicable law,
without notice to Borrower or any party claiming through Borrower,
without regard to the solvency or insolvency at such time of any
Person then liable for the payment of any of the Obligations,
without regard to the then value of the Collateral and without
requiring any bond from any complainant in such proceedings, be
entitled as a matter of right to the appointment of a receiver or
receivers (who may be the Secured Party) of the Collateral or any
part thereof, and of the profits, revenues and other income
thereof, pending such proceedings, with such powers as the court
making such appointment shall confer, and to the entry of an order
directing that the profits, revenues and other income of the
property constituting the whole or any part of the Collateral be
segregated, sequestered and impounded for the benefit of the
Secured Party, and Borrower irrevocably consents to the appointment
of such receiver or receivers and to the entry of such
order.
Section
5.04
Limitation on Duty
of the Secured Party in Respect of Collateral
.
Beyond the exercise of reasonable care
in the custody thereof, the Secured Party shall have no duty to
exercise any rights or take any steps to preserve the rights of
Borrower in the Collateral in its possession or control or in the
possession or control of any agent or bailee or any income thereon
or as to the preservation of rights against prior parties or any
other rights pertaining thereto, nor shall the Secured Party be
liable to Borrower or any other Person for failure to meet any
obligation imposed by Section 9-207 of the UCC or any successor
provision. Borrower agrees that the Secured Party shall at no time
be required to, nor shall the Secured Party be liable to Borrower
for any failure to, account separately to Borrower for amounts
received or applied by the Secured Party from time to time in
respect of the Collateral pursuant to the terms of this Security
Agreement.
Section
5.06
Waiver and
Estoppel
.
(a) Borrower
agrees, to the extent it may lawfully do so, that it will not at
any time in any manner whatsoever claim or take the benefit or
advantage of, any appraisal, valuation, stay, extension,
moratorium, turnover or redemption law, or any law permitting it to
direct the order in which the Collateral shall be sold, now or at
any time hereafter in force which may delay, prevent or otherwise
affect the performance or enforcement of this Security Agreement,
and Borrower hereby waives all benefit or advantage of all such
laws. Borrower covenants that it will not hinder, delay or impede
the execution of any power granted to the Secured Party pursuant to
the Credit Agreement, this Security Agreement or any other related
agreement or document.
(b) Borrower
waives, to the extent permitted by law, presentment, demand,
protest and any notice of any kind (except the notices expressly
required hereunder) in connection with this Security Agreement and
any action taken by the Secured Party with respect to the
Collateral.
Section
5.07
Application of
Proceeds
. The proceeds of any sale of, or other realization
upon, all or any part of the Collateral and any cash held by the
Secured Party or its nominee or custodian hereunder shall be
applied in the following order of priority:
FIRST,
to payment of the expenses of such sale or other realization,
including reasonable compensation to agents and counsel for the
Secured Party, and all expenses, liabilities and advances incurred
or made by the Secured Party in connection therewith, and any other
Obligations owing to the Secured Party in respect of sums advanced
by the Secured Party to preserve the Collateral or to preserve its
security interests in the Collateral;
SECOND,
to the payment of the Credit Agreement and all the Obligations,
until the Credit Agreement and all the Obligations shall have been
paid in full; and
THIRD,
to Borrower, or its successors or assigns, or as a court of
competent jurisdiction may direct.
The
Secured Party may make distributions hereunder in cash or in kind
or, on a ratable basis, in any combination thereof.
ARTICLE VI
MISCELLANEOUS
Section
6.01
Notices
.
All notices, requests, claims, demands and other communications
hereunder shall be deemed to have been duly given in the manner and
at the respective addresses of the parties set forth in the Credit
Agreement.
Section
6.02
No
Waivers; Non-Exclusive Remedies
.
No failure or delay on the part of the
Secured Party to exercise, no course of dealing with respect to,
and no delay in exercising, any right, power or privilege under
this Security Agreement or any other document or agreement
contemplated hereby or thereby shall operate as a waiver thereof
nor shall any single or partial exercise of any such right, power
or privilege preclude any other or further exercise thereof or the
exercise of any other right, power or privilege. The rights and
remedies provided herein are cumulative and are not exclusive of
any other remedies provided by law.
Section
6.04
Amendments and
Waivers
.
Any
provision of this Security Agreement may be amended, changed,
discharged, terminated or waived if, but only if, such amendment or
waiver is in writing and is signed by Borrower directly affected by
such amendment, change, discharge, termination or waiver and the
Secured Party.
Section
6.05
Successors
and Assigns
.
This
Security Agreement shall be binding upon each of the parties hereto
and inure to the benefit of the Secured Party and its successors
and assigns. In the event of an assignment of all or any of the
Obligations, the rights hereunder, to the extent applicable to the
indebtedness so assigned, may be transferred with such
indebtedness. Borrower shall not assign or delegate any of its
rights and duties hereunder without the prior written consent of
the Secured Party.
Section
6.06
Governing
Law
.
This Agreement
shall be construed and enforced in accordance with the laws of the
State of North Carolina, without giving effect to the conflict of
law principles thereof. The parties specifically consent to the
jurisdiction of the state and federal courts located in the State
of North Carolina in any action, whether at law or in equity,
brought by the any party to protect any of their rights
hereunder.
Section
6.07
Limitation of Law;
Severability
.
(a) All
rights, remedies and powers provided in this Security Agreement may
be exercised only to the extent that the exercise thereof does not
violate any applicable provision of law, and all the provisions of
this Security Agreement are intended to be subject to all
applicable mandatory provisions of law which may be controlling and
be limited to the extent necessary so that they will not render
this Security Agreement invalid, unenforceable in whole or in part,
or not entitled to be recorded, registered or filed under the
provisions of any applicable law.
(b) If
any provision hereof is invalid or unenforceable in any
jurisdiction, then, to the fullest extent permitted by law, (i) the
other provisions hereof shall remain in full force and effect in
such jurisdiction and shall be liberally construed in favor of the
Secured Party in order to carry out the intentions of the parties
hereto as nearly as may be possible; and (ii) the invalidity or
unenforceability of any provision hereof in any jurisdiction shall
not affect the validity or enforceability of such provisions in any
other jurisdiction.
Section
6.08
Counterparts;
Effectiveness
.
This
Security Agreement may be signed in any number of counterparts,
each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument. This
Security Agreement shall become effective with respect to Borrower
when the Secured Party shall receive counterparts hereof executed
by itself and Borrower.
Section
6.09
Termination
.
Upon the full, final and irrevocable payment and performance of all
Obligations, the Security Interests shall terminate and all rights
to the Collateral shall revert to Borrower.
Section
6.10
Entire
Agreement
.
This
Security Agreement constitutes the entire agreement and
understanding among the parties hereto and supersedes any and all
prior agreements and understandings, oral or written, and any
contemporaneous oral agreements and understandings relating to the
subject matter hereof and thereof.
IN WITNESS WHEREOF
, the parties have
executed this Agreement to be effective as of the date first above
written.
Level
Brands, Inc.
Martin
A. Sumichrast, CEO
Kure
Corp.
Craig
Brewer, CEO
Exhibit 10.66
PROMISSORY
NOTE
(Revolving
Note)
$500,000
|
Charlotte, North Carolina
|
December 12, 2017
FOR VALUE RECEIVED
, the undersigned,
Kure Corp., a Florida Corporation (the “
Maker
”), hereby promise(s) to pay
to the order of Level Brands, Inc., a North Carolina corporation
(together with its successors and assigns, the “
Holder
”), the principal sum of the
lesser of (i) Five Hundred Thousand Dollars ($500,000) or
(ii) the aggregate unpaid principal amount of all advances
made by the Holder under this Promissory Note and the Revolving
Line of Credit (as defined below), together with interest on all
principal amounts available for advancement hereunder at eight
percent (8%) per annum on the earliest to occur of: (a) first
anniversary of the date hereof, or (b) a Qualified Private Offering
(as defined below) (“
Maturity
”). Interest shall be paid
in arrears at Maturity and computed on the basis of a 365-day
year.
For
purposes hereof, “
Qualified
Private Offering
” shall mean the issuance or sale by
Borrower of its equity securities in a private offering resulting
in gross proceeds to the Borrower of at least Two Million Dollars
($2,000,000).
The
Maker reserves the right to prepay all or any portion of this
Promissory Note at any time and from time to time without premium
or penalty of any kind. All payments made hereunder shall be made
in lawful currency of the Unites States of American in accordance
with the terms in the Revolving Line of Credit, dated even date
herewith, between the Maker and the Holder (the “
Credit Agreement
”), or at such
other place as the Holder may designate in writing. All payments
made hereunder, whether a scheduled payment, prepayment, or
payments as a result of acceleration, shall be allocated first to
accrued but unpaid interest, and then to payments of principal
remaining outstanding hereunder.
Each
person liable hereon agrees to pay all reasonable costs of
collection, including attorneys’ fees, paid or incurred by
the Holder in enforcing this Promissory Note on default or the
rights and remedies herein provided.
This
Promissory Note is made pursuant to the provisions of the Credit
Agreement. The Credit Agreement, among other things, contains
provisions for acceleration of the maturity of this Promissory Note
upon the happening of certain stated events and also for
prepayments of the principal hereof prior to the maturity of this
Promissory Note upon the terms and conditions specified therein.
This Promissory Note is secured by a Security Agreement, dated of
even date herewith, between the Maker and the Holder.
The
Maker, for itself and for any guarantors, sureties, endorsers
and/or any other person or persons now or hereafter liable hereon,
if any, hereby waives demand of payment, presentment for payment,
protest, notice of nonpayment or dishonor and any and all other
notices and demands whatsoever, and any and all delays or lack of
diligence in the collection hereof, and expressly consents and
agrees to any and all extensions or postponements of the time of
payment hereof from time to time at or after maturity and any other
indulgence and waives all notice thereof.
No
delay or failure by the Holder in exercising any right, power,
privilege or remedy hereunder shall affect such right, power,
privilege or remedy or be deemed to be a waiver of the same or any
part thereof; nor shall any single or partial exercise thereof or
any failure to exercise the same in any instance preclude any
further or future exercise thereof, or exercise of any other right,
power, privilege or remedy, and the rights and privileges provided
for hereunder are cumulative and not exclusive. The delay or
failure to exercise any right hereunder shall not waive such
right.
The
Holder may sell, assign, pledge or otherwise transfer all or any
portion of its interest in this Promissory Note at any time or from
time to time without prior notice to or consent of and without
releasing any party liable or to become liable hereon.
This
Promissory Note shall be governed by and construed and enforced in
accordance with the laws of the State of North
Carolina.
IN WITNESS WHEREOF
, the undersigned has
duly caused this Promissory Note to be executed and delivered as of
the date first written above.
Kure
Corp.
Craig
Brewer, CEO
Exhibit 99.1
Level Brands Initiates Transaction with Two Brand Management
Clients
Kure Corp. Announces Master Purchase Agreement with Retail
Innovator SG Blocks for Strategic Kure Vape Pod
™ to be
Launched in
2018
CHARLOTTE,
N.C., Dec. 12, 2017 /PRNewswire/ -- Level Brands, Inc. (NYSE
American:LEVB), an innovative marketing and licensing company that
provides bold, unconventional and socially responsible branding for
leading businesses,
announced today that it
has initiated a transaction between two of its license and brand
management clients, Kure Corp., one of America’s leading
specialty vape retailers based in Charlotte, NC, and SG Blocks,
Inc. (NASDAQ:SGBX), a leading designer, innovator and fabricator of
container-based structures based in Brooklyn, NY
. Kure has entered into a Master
Purchase Agreement for the purchase of 100 SG Blocks’
repurposed shipping containers for its Kure Vape Pod™
initiative. The initial six SG Blocks’ containers are
scheduled for delivery in the first quarter of 2018. It is
anticipated that Kure will subsequently accelerate its draw down on
its additional units of inventory once the initial Kure Vape
Pods™ are operational and additional location sites are
secured. Level Brands provided a $500,000 secured project finance
facility to Kure to facilitate the completion of the initial
development phase. Each of the premier Kure Vape Pod™ designs
will utilize two of SG Blocks’ containers. Based upon the
Master Services Agreement, if all 100 units are purchased, the
total contract value is expected to exceed
$3,750,000.
“Kure, led by its incredible CEO Craig Brewer, is a leader in
the vaping lifestyle movement,
which
we believe is healthier than tobacco and traditional cigarettes,
and SG Blocks is the foremost innovator and leader in the field of
repurposed, container-based structures. The partnership between
these two revolutionary industry leaders is the first of many such
synergistic opportunities and is a great example of the disruptive
thinking that drives Level Brands’ business
philosophy,” says Kathy Ireland®, Chairman Emeritus and
Chief Brand Strategist of Level Brands. “Level Brands is
dedicated to propelling the world’s most disruptive brands,
with the unique ability to leverage brands’ needs and
capabilities, and to capitalize on those opportunities. The
possibilities at Level Brands are truly
exciting.”
“We are pleased to have brought together these two visionary
clients, and we look forward to their future success and
growth,” says
Martin Sumichrast, President and CEO of
Level Brands.
“We
believe the Kure-SG Blocks partnership will generate income to
Level Brands at various points, from residual fees from SG Blocks,
to license fees from Kure, and to project finance
fees.”
“We are excited about this next growth phase for Kure, and
our partnership with Paul Galvin and SG Blocks. This innovative,
green building structure is a perfect fit for the Kure Vape
Pod™,” says Craig Brewer, CEO of Kure Corp. “All
of us at Kure have prided our success on delivering the
country’s optimum high-end vape lifestyle experience. Kathy
is an incredible leader, and her team’s business savvy and
forward thinking vision is secondary to none. This cool new retail
space will boast the same atmospheric, lounge-like, take-a-seat
environment that has made our Kure Vaporiums™ a favored place
for millennials to hang out and connect. Likewise, we are
developing our new I’M1 e-Juice brand, which we will also
hold to the same level as our Kure
Vaporiums™.”
Tommy Meharey, Marine, Millennial, Father and Co-Founder of Ireland
Men 1 (I'M1) with Kathy Ireland, notes that “According
to statistics, the vaping industry will surpass $20 billion in
revenues by 2022. I’M1, for millennial men and the women who
love them, is another perfect opportunity for a license agreement,
and we are thrilled to soon be launching the new I’M1 e-Juice
brand with Kure.”
“Our collaboration with Level Brands is off to a great start,
and we are pleased the company brought us together with Kure. We
are experiencing increasing demand for our eco-friendly repurposed
solutions, an important tenet for millennials, and we expect the
Kure Vape Pods™ rollout to be met with great success,”
says Paul M. Galvin, Chairman, Chief Executive and Founder of SG
Blocks. “Additionally, I’m excited to be teamed with
Level Brands, a company that is committed to social responsibility,
with
each partner, client, and licensee supporting its
Millennium Development Goals to improve the condition of lives
around the world.
”
About Level Brands, Inc.
(
www.LevelBrands.com
)
Level
Brands creates bold, unconventional and socially responsible
branding for leading businesses. With a focus on corporate brand
management and consumer products marketing art, beauty, fashion,
health & wellness including the beverage space, entertainment,
and real estate. Licensed brand marketing is at the core of the
Level Brand businesses: Ireland Men One or I'M1, for millennial men
and the women who love them; Encore Endeavor One or EE1, corporate
brand management and producer of experiential entertainment events
and products across multiple platforms;
kathy ireland
® Health
& Wellness; Beauty & Pin-Ups, Level Brands' hair care and
disruptive women's products brand.
About KURE Corp
(
www.KUREsociety.com
)
KURE
Corp. ("KURE") is a private company based in Charlotte, North
Carolina that specializes in the distribution of vaporizing
pens, e-Juices, and related accessories through its specialty
retail stores and online distribution. KURE's primary products are
its distinct line of custom blended high-end flavored e-Juices,
premium KURE brand vaporizers, as well as popular third party
brands of advanced hardware and select eLiquids. All KURE products
are available online and throughout its many store locations
across the United States. KURE Vaporium™, KURE
Society™, Kuriousity™, Kurators™ are all
respective trademarks of KURE Corp. KURE's executives and
principals are seasoned business entrepreneurs with decades
individual expertise in taking start-ups from initial incubation to
profitability. KURE's support staff has extensive product
distribution and related industry experience. Its e-Juices can be
purchased pre-bottled or freshly mixed by its staff of "Kurators",
well trained and experienced mixologists who can "blend" over
500,000 unique flavors from the KURE Juice On Tap™ bar. These
KURE e-Juices are skillfully blended and served while customers
shop, lounge and enjoy a selection of coffees, beverages, and
snacks or simply vape and mingle with other like-minded
enthusiasts.
About SG Blocks, Inc.
(
www.sgblocks.com
)
SG
Blocks, Inc. is a premier innovator in advancing and promoting the
use of code-engineered cargo shipping containers for safe and
sustainable construction. The firm offers a product that exceeds
many standard building code requirements, and also supports
developers, architects, builders and owners in achieving greener
construction, faster execution, and stronger buildings of higher
value. Each project starts with GreenSteel™, the structural
core and shell of an SG Blocks building, which is then customized
to client specifications.
About Ireland Men 1 (I’M1)
I'M1,
for
millennial men, and the women who love them
, is a lifestyle
brand ideal for men who take pride in their appearance, thrive on
quality and value what matters. I'M1 was co-founded by Kathy
Ireland and Tommy Meharey - Marine, millennial father, global
fashion model, concert producer, Vice President
of
kathy
ireland
® Weddings & Resorts, as well
as the younges
t Board of Directors member
of
kathy
ireland
® Worldwide. The I’M1
license portfolio includes I'M1 Suits, bespoke, tailored offerings
in partnership with André Phillipe; I'M1 Eyewear by Looseleaf;
and I'M1 e-juice by Kure. I'M1 is a subsidiary of Level
Brands, Inc. (NYSE: LEVB)
Forward-Looking Statements
This press release may include ''forward-looking statements.'' To
the extent that the information presented in this presentation
discusses financial projections, information, or expectations about
Level Brands, Inc.'s business plans, results of operations,
products or markets, or otherwise makes statements about future
events, such statements are forward-looking. Such
forward-looking statements can be identified by the use of words
such as ''should,'' ''may,'' ''intends,'' ''anticipates,''
''believes,'' ''estimates,'' ''projects,'' ''forecasts,''
''expects,'' ''plans,'' and ''proposes.'' Although Level Brands,
Inc. believes that the expectations reflected in these
forward-looking statements are based on reasonable assumptions,
there are a number of risks and uncertainties that could cause
actual results to differ materially from such forward-looking
statements. You are urged to carefully review and consider any
cautionary statements and other disclosures, including the
statements made under the heading "Risk Factors" in Level Brands,
Inc.’s Offering Statement filed with the Securities and
Exchange C
ommission (the "SEC")
and Level Brands, Inc.’s SEC reports. Forward-looking
statements speak only as of the date of the document in which they
are contained, and Level Brands, Inc. does not undertake any duty
to update any forward-looking statements except as may be required
by law.
Contact:
MDC Group
Investor
Relations:
David
Castaneda
414.351.9758
IR@LevelBrands.com
Press
Inquiries for Level Brands:
Susan
Roush
805.624.7624
PR@LevelBrands.com
Press
Inquiries for Kathy Ireland
®
/
kathy
ireland
®
Worldwide/
Kure Corp:
Rona
Menashe
310.246.4600
rona@guttmanpr.com
Investor
Relations for SG Blocks:
MZ North America
Chris Tyson
949-491-8235
chris.tyson@mzgroup.us
Media
Inquiries for SG Blocks:
Rubenstein Public Relations
Kati Bergou
212-805-3014
kbergou@rubensteinpr.com
An artist rendering of an interior of one of the Vape Pods –
source: Kure Corp.