As previously disclosed by cbdMD, Inc. (the "Company"), commencing August 2019 the Company's executive offices have been located at 8845 Red Oak Blvd, Charlotte, NC (the "Red Oak Facilities") which we sub-lease under a sublease agreement dated July11, 2019 which expires December 2026 (the "Red Oak Sublease") and we are currently behind in lease payments on the Red Oak Sublease, receiving a default notice from HSKL, Inc., in September 2023. Effective March 20, 2024 we entered into a License Agreement, dated as of March 14, 2024, by and between cbdMD, Inc. and HSKL, Inc. (the "License Agreement") and Lease Forbearance Agreement, dated as of March 14, 2024, by and between cbdMD, Inc. and HSKL, Inc. (the "Forbearance Agreement"). Under the License Agreement we have granted HSKL a license to possess and use a portion of the Red Oak Facilities until the earlier of (i) the termination of the Forbearance Agreement and (ii) July 31, 2024 (the "Termination Date"). The termination of the License Agreement will result in termination of the Red Oak Sublease. Pursuant to the Forbearance Agreement HSKL has agreed to forbear from proceeding to exercise its remedies against us under the Red Oak Sublease, and the declaration of default related to past due rent in consideration of the following payments to HSKL: $80,000 upon the execution of the Forbearance Agreement, followed by four monthly payments of $40,000. HSKL's forbearance shall extend to the Termination Date and HSKL shall dismiss (without prejudice) a Complaint in Summary Ejectment filed in Mecklenburg County, North Carolina on February 27, 2024. In the event of our breach of any of the conditions of the Forbearance Agreement, HSKL's obligation to forbear shall cease, and HSKL may immediately exercise any and all of its rights or remedies at law, in equity or under the Red Oak Sublease.
Effective March 20, 2024 our executive offices are located at 2101 Westinghouse Blvd Suite A, Charlotte, NC, which facilities have also served as our warehouse facilities since November 2019. The consolidation of our warehouse facilities and executive offices is consistent with management's efforts to rationalize and right size our expenses across all areas of our business and operations. The new executive office facilities are sufficient to maintain our current operations.
The foregoing description of the terms of the License Agreement and the Forbearance Agreement and the transactions contemplated thereby does not purport to be complete and are qualified in its entirety by reference to the License Agreement and Forbearance Agreement, a copy of which are filed or incorporated by reference as Exhibits 10.1 and 10.2, respectively, to this Current Report on Form 8-K.
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cbdMD, Inc. produces and distributes cannabidiol (CBD) products. The Company owns and operates CBD brands cbdMD, Paw CBD and cbdMD Botanicals. Its cbdMD brand of products includes a range of premium every day and functional CBD products, including tinctures; gummies; topicals; capsules; drink mixes; and sleep, focus and calming aids.Its Paw CBD brand of products includes a line of veterinarian-formulated products including tinctures, chews, topicals products in varying strengths and formulas. Its cbdMD Botanicals brand of beauty and skincare products features facial oil and serum, toners, moisturizers, clear skin, facial masks, exfoliants and body care stock-keeping units (SKU). cbdMD, Paw CBD and cbdMD Botanicals products are distributed through its e-commerce websites, third party ecommerce sites, select distributors and marketing partners as well as a variety of brick-and-mortar retailers. Its products are sold through www.cbdmd.com, www.pawcbd.com, and cbdmdbotanicals.com Websites.