XCel Brands Sells IP Assets, Discloses Equity Sales

TL;DR

XCel Brands sold IP assets and sold some stock. Big changes coming.

AI Summary

On March 14, 2024, XCel Brands, Inc. entered into a Material Definitive Agreement related to the sale of its intellectual property and related assets. The filing also disclosed unregistered sales of equity securities and included financial statements and exhibits.

Why It Matters

This filing indicates a significant strategic shift for XCel Brands, potentially impacting its future revenue streams and business operations through the divestiture of intellectual property.

Risk Assessment

Risk Level: medium — The sale of intellectual property and unregistered equity sales can introduce uncertainty regarding the company's future financial performance and strategic direction.

Key Players & Entities

• XCel Brands, Inc. (company) — Registrant
• March 14, 2024 (date) — Date of earliest event reported

FAQ

Key Financial Figures

• $0.001 — h registered Common Stock, par value $0.001 per share XELB Nasdaq Capital Market
• $0.65 — mon Stock") at a price to the public of $0.65 per Share. The Offering was made pursu
• $1,750,000 — trant, are expected to be approximately $1,750,000. The Registrant intends to use the net
• $0.8125 — isable at a per share exercise price of $0.8125. The Representative's Warrants are exer
• $0.98 — rivate Placement Shares") at a price of $0.98 per Private Placement Share. The purcha

Filing Documents

• tm249267d1_8k.htm (8-K) — 37KB
• tm249267d1_ex1-1.htm (EX-1.1) — 354KB
• tm249267d1_ex5-1.htm (EX-5.1) — 9KB
• tm249267d1_ex10-1.htm (EX-10.1) — 31KB
• tm249267d1_ex10-2.htm (EX-10.2) — 31KB
• tm249267d1_ex10-3.htm (EX-10.3) — 30KB
• tm249267d1_ex99-1.htm (EX-99.1) — 10KB
• tm249267d1_ex99-2.htm (EX-99.2) — 10KB
• tm249267d1_ex5-1img001.jpg (GRAPHIC) — 4KB
• 0001104659-24-036225.txt ( ) — 805KB
• xelb-20240314.xsd (EX-101.SCH) — 3KB
• xelb-20240314_lab.xml (EX-101.LAB) — 33KB
• xelb-20240314_pre.xml (EX-101.PRE) — 22KB
• tm249267d1_8k_htm.xml (XML) — 3KB

01

Item 1.01. Entry into a Material Definitive Agreement. On March 15, 2024, Xcel Brands, Inc. (the "Registrant") entered into an underwriting agreement (the "Underwriting Agreement") with Craig-Hallum Capital Group LLC (the "Representative"), as the representative of the underwriters named therein (the "Underwriters"), relating to a firm commitment underwritten public offering (the "Offering") of 3,284,421 shares (the "Shares") of the Registrant's common stock, par value $0.001 per share ("Common Stock") at a price to the public of $0.65 per Share. The Offering was made pursuant to the Registrant's registration statement on Form S-3 (File No. 333-276698), previously filed with the Securities and Exchange Commission (the "SEC") on January 26, 2024, and declared effective on February 6, 2024, and a prospectus supplement dated March 15, 2024. The legal opinion, including the related consent, of Blank Rome LLP relating to the issuance and sale of the Shares is filed as Exhibit 5.1 hereto. The closing of the Offering occurred on March 19, 2024. The net proceeds to the Registrant from the sale of the Shares, after deducting the underwriting discounts and commissions and other estimated offering expenses payable by the Registrant, are expected to be approximately $1,750,000. The Registrant intends to use the net proceeds from the Offering for working capital and general corporate purposes. The Registrant issued press releases announcing the launch and pricing of the Offering, which have been filed as Exhibits 99.1 and 99.2 to this report, respectively. Upon closing of the Offering, the Registrant issued the Representative warrants (the "Representative's Warrants") as compensation to purchase up to 178,953 shares of Common Stock (5% of the number of shares of Common Stock sold in the Offering). The Representative's Warrants will be exercisable at a per share exercise price of $0.8125. The Representative's Warrants are exercisable, in whole or in part, during the four a

02

Item 3.02 Unregistered Sales of Equity Securities The Private Placement Shares referenced above were sold without registration under the Act, in reliance upon the exemptions from registration provided under Section 4(2) of the Act in reliance upon the exemptions from registration provided under Section 4(2) of the Act and Regulation D promulgated under the Act ("Regulation D"). The Private Placement Investors represented in the Subscription Agreements, among other things, that such Private Placement Investor was acquiring the Private Placement Shares for investment for the Private Placement Investor's account and that the investor was an "accredited investor" within the meaning of Regulation D.

Financial Statements and Exhibits

Financial Statements and Exhibits. (d) Exhibits. 1.1 Underwriting Agreement, dated as of March 15, 2024, by and between Xcel Brands, Inc. and Craig-Hallum Capital Group LLC. 4.1 Form of Representative's Warrant (included in Exhibit 1.1). 5.1 Opinion of Blank Rome LLP 10.1 Subscription Agreement, dated as of March 15, 2024, by and between Robert W. D'Loren and Xcel Brands, Inc. 10.2 Subscription Agreement, dated as of March 15, 2024, by and between Seth Burroughs and Xcel Brands, Inc. 10.3 Subscription Agreement, dated as of March 15, 2024, by and between Mark X. DiSanto Investment Trust and Xcel Brands, Inc. 23.1 Consent of Blank Rome LLP (included in Exhibit 5.1) 99.1 Press Release of Xcel Brands, Inc. dated March 14, 2024. 99.2 Press Release of Xcel Brands, Inc. dated March 15, 2024. 104 Cover Page Interactive Data File (embedded within the inline XBRL document).

SIGNATURES

SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. Date: March 19, 2024 XCEL BRANDS, INC. By: /s/ James F. Haran Name: James F. Haran Title: Chief Financial Officer

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View this 8-K filing on SEC EDGAR