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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)
April 19,
2019
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 450, Charlotte, NC 28211
(Address of principal executive offices)(Zip Code)
Registrant's
telephone number, including area code: (704) 362-6286
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
3.02. Unregistered
Sales of Equity Securities.
As set forth in Item 5.07 appearing later in this
report, on April 19, 2019 at our 2019 annual meeting the
shareholders of Level Brands, Inc. approved the issuance of an
aggregate of 15,250,000 shares of our common stock pursuant to
the rights granted as consideration for the mergers which
closed on December 20, 2018 pursuant to the terms of the Agreement
and Plan of Merger dated December 3, 2018 by and among our company,
our wholly-owned subsidiaries and Cure Based Development, LLC (the
“Merger Agreement”), including:
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an
aggregate of 6,500,000 shares of our common stock to be issued to
the former members of Cure Based Development, LLC (the “First
Tranche Shares”); and
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●
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an
additional 8,750,000 shares of our common stock (the “Second
Tranche Shares”) to be issued to CBD Holding, LLC, a member
of Cure Based Development which is controlled by Mr. R. Scott
Coffman, a member of our board of directors and president of our
CBD Industries, LLC (formerly cbdMD, LLC) subsidiary. The Second
Tranche Shares vest follows: (i) 2,187,500 shares will vest on the
12 month anniversary of the closing date; (ii) an additional
2,187,500 shares will vest on the 24 month anniversary of the
closing date; (iii) an additional 2,187,500 shares will vest on the
42 month anniversary of the closing date; and (iv) the remaining
2,187,500 shares will vest on the 60 month anniversary of the
closing date.
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We will issue the First Tranche Shares and the
Second Tranche Shares on April 22, 2019. Upon issuance, these
shares will be fully paid and non-assessable. The First Tranche
Shares and the Second Tranche Shares are subject to leak out
agreements pursuant to which the holder is required to (1)
limit the offer for sale, sell, pledge, or otherwise transfer or
dispose of (or enter into any transaction or device that is
designed to, or could be expected to, result in the transfer or
disposition by any person at any time in the future of) any shares
of our common stock; and (2) refrain from entering into any swap or
other derivatives transaction that transfers to another, in whole
or in part, any of the economic benefits or risks of ownership of
any shares of our common stock, whether any such transaction
described in clause (1) or (2) above is to be settled by delivery
of shares of our common stock or other securities, in cash or
otherwise to the lesser of (i) the volume limitations set forth in
Rule 144(e) of the Securities Act of 1933, as amended (the
“Securities Act”), or (ii) 20% of such shares in any 90
day period. In addition, the Second
Tranche Shares are subject to an irrevocable voting proxy agreement
until such time as the shares vest in accordance with the terms of
the Merger Agreement. The independent chairman of the Audit
Committee of our board of directors serves as proxyholder and will
vote those shares in accordance with the recommendations of our
board of directors. The initial proxyholder is Mr. Seymour Siegel,
the current Chairman of the Audit Committee of our board of
directors.
The
recipients of the First Tranche Shares and the Second Tranche
Shares are accredited investors and the issuances will be exempt
from registration under the Securities Act in reliance on
exemptions provided by Section 4(a)(2) of such act.
Item
5.07. Submission of Matters to a Vote of Security
Matters.
On
April 19, 2019, we held our 2019 annual meeting of shareholders
where five proposals were voted upon. The proposals are described
in detail in our definitive proxy statement on Schedule 14A filed
with the Securities and Exchange Commission on March 21, 2019. Of
the 10,170,356 shares of our common stock outstanding and entitled
to vote at the annual meeting, 5,451,893 shares (or 53.6 %),
constituting a quorum, were represented in person or by proxy at
the 2019 annual meeting. At the meeting all the proposals were
approved and the final vote on the proposals was recorded as
follows:
Proposal
1: The following
directors were elected at the 2019 annual meeting of shareholders
to hold office until the 2020 annual meeting of shareholders or
their earlier resignation, removal or death:
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For
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Against
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Abstain
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Martin
A. Sumichrast
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5,427,754
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24,139
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R.
Scott Coffman
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5,435,649
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16,244
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Anthony
K. Shriver
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5,074,546
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377,347
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Seymour
G. Siegel
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5,078,096
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373,797
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Bakari
Sellers
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5,429,107
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22,786
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Gregory
C. Morris
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5,078,326
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373,567
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Peter
J. Ghiloni
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5,439,099
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12,794
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Scott
G. Stephen
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5,439,099
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12,794
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William
F. Raines, III
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5,437,459
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15,294
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Proposal
2: The appointment of
Cherry Bekaert LLP as our independent registered public accounting
firm was ratified, based upon the following final tabulation of
votes:
For
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Against
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Abstain
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5,437,459
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5,545
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8,889
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Proposal
3: The issuance of up
to 30,500,000 shares of our common stock, including up to
15,250,000 shares which are subject to the satisfaction of earnout
targets, pursuant to the rights granted as consideration for the
mergers which closed on December 20, 2018 pursuant to the terms of
the Agreement and Plan of Merger dated December 3, 2018 by and
among our company, our wholly-owned subsidiaries and Cure Based
Development, LLC (the “Merger Agreement”) was approved
based upon the following final tabulation of votes:
For
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Against
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Abstain
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5,385,722
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8,845
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57,326
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Proposal
4: The change of our
company’s name to “cbdMD, Inc.” was approved
based upon the following final tabulation of votes:
For
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Against
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Abstain
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5,370,418
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13,475
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68,000
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Proposal
5: The amendment to
our 2015 Equity Compensation Plan to increase the number of shares
available for issuance under the plan was approved based upon the
following final tabulation of votes:
For
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Against
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Abstain
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4,753,896
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605,518
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83,869
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Immediately
following the annual meeting, the board of directors appointed the
following individuals to the committees of the board, each to serve
at the pleasure of the board of directors:
Director
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Audit Committee Member
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Compensation Committee Member
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Corporate Governance and Nominating Committee Member
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Anthony
K. Shriver
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✓
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Seymour
G. Siegel
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✓*
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✓
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Bakari
Sellers
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✓
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✓*
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Gregory
C. Morris
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✓
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✓
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Peter
J. Ghiloni
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✓
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Scott
G. Stephen
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✓*
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On
April 22, 2019 we will file articles of amendment with the State of
North Carolina for the name change which will specify an effective
date of the name change of May 1, 2019. On the effective date of
the name change, it is expected that our common stock will begin
trading under the new name and the trading symbol
“YCBD” on the NYSE American stock exchange. The name
change will also result in a change to the CUSIP number for the
Company’s common stock on May 1, 2019 to 12482W
101.
We will
file a separate Current Report on Form 8-K which will include a
copy of the filed articles of amendment.
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:
April 19, 2019
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By:
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/s/
Mark S. Elliott
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Mark S.
Elliott, Chief Financial Officer and Chief Operating
Officer
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