Document:

Exhibit 10.56

 

AMENDMENT NO. 3

TO

LINE LETTER AGREEMENT

 

THIS AMENDMENT NO. 3 TO
LINE LETTER AGREEMENT (this “Amendment”) is entered into as of February [__], 2015, by and among IM BRANDS,
LLC, a Delaware limited liability company (“Borrower”), XCEL BRANDS, INC., a Delaware corporation (“Guarantor”)
and BANK HAPOALIM B.M. (“Bank”).

 

BACKGROUND

 

Borrower, Guarantor and
Bank are parties to a Line Letter Agreement dated as of July 31, 2013 (as amended by that certain Amendment No. 1, dated as of
April 1, 2014 and as may be further amended, restated, supplemented or otherwise modified from time to time, the “Letter
Agreement”) pursuant to which Bank made a term loan to Borrower.

 

On July 31, 2013 Borrower
executed a Promissory Note in the original principal amount of $13,000,000 in favor of Bank (as amended, modified, supplemented
and restated from time to time, the “Note”) to evidence such term loan.

 

Guarantor has guaranteed
the payment and performance of Borrower’s obligations to Bank under the Note and the Letter Agreement pursuant to a Guaranty
dated as of July 31, 2013 (as amended, modified, supplement and restated from time to time, the “Guaranty”).

 

Borrower and Bank have
agreed to amend the Loan Documents on the terms and conditions set forth herein.

 

NOW, THEREFORE, in consideration
of the financial accommodations to be provided to H Licensing by Bank, and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:

 

1.            Definitions.
All capitalized terms not otherwise defined herein shall have the meanings given to them in the Letter Agreement and the Note,
as applicable.

 

2.            Amendment to Letter
Agreement. The Letter Agreement is hereby amended as follows:

 

(a)          Section 4(f) is
amended by deleting the last sentence thereof.

 

(b)          Section 4(n) is amended
in its entirety to provide as follows:

 

    	 

    	 

    

 

 

“(n) Cash Flow Recapture.
If for any fiscal year commencing with the fiscal year ending on December 31, 2015, there shall be Excess Cash Flow for such fiscal
year, the Borrower shall pay to Bank an amount equal to the Applicable Recapture Percentage of such Excess Cash Flow (the “Cash
Flow Recapture Requirement”), to be applied by Bank to the principal amount of the Term Loan in the reverse order of
maturity. The Cash Flow Recapture Requirement for any such fiscal year shall be received by the Bank no later than the date of
delivery of the financial statements for such fiscal year required pursuant to Section 3(a)(i). As used herein, the term “Applicable
Recapture Percentage” shall mean (i) until such time as payments received by Bank as respects the principal amount
of the Term Loan and the principal amount of the term loan made to JR Licensing by the Bank equals $1,000,000 in the aggregate
(other than a result of scheduled amortization payments), fifth percent (50%) and (ii) at all times thereafter, twenty percent
(20%).”

 

3.            Conditions of
Effectiveness. This Amendment shall become effective upon (a) a Lender’s receipt of this Amendment executed by Borrower
and Guarantor in form and substance satisfactory to Bank and (b) the payment to Bank of an amendment fee in the amount of $10,000.

 

4.            Representations
and Warranties. Each of Borrower and Guarantor hereby represents and warrants as follows:

 

(a)           This Amendment and
the Loan Documents, as amended hereby, constitute legal, valid and binding obligations of Borrower and Guarantor, to the extent
a party thereto and are enforceable against Borrower and Guarantor in accordance with their respective terms, except to the extent
that such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting the enforcement of creditors’ rights generally or limiting the right of specific performance.

 

(b)           Upon the effectiveness
of this Amendment, each of Borrower and Guarantor hereby reaffirms all covenants, representations and warranties made in the Loan
Documents to the extent the same are not amended hereby and agree that all such covenants, representations and warranties shall
be deemed to have been remade as of the effective date of this Amendment.

 

(c)           No Event of Default
has occurred and is continuing or would exist after giving effect to this Amendment.

 

(d)           Neither Borrower nor
Guarantor has any defense, counterclaim or offset with respect to the Loan Documents.

 

5.            Effect on the
Loan Documents.

 

(a)           Upon the effectiveness
of this Amendment, each reference to a Loan Document shall mean and be a reference to such Loan Document as amended hereby.

 

(b)           Except as specifically
amended herein, the Loan Documents, shall remain in full force and effect, and are hereby ratified and confirmed.

 

(c)           The execution, delivery
and effectiveness of this Amendment shall not operate as a waiver of any right, power or remedy of Lender, nor constitute a waiver
of any provision of any Loan Document.

 

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6.            Governing Law.
This Amendment shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns
and shall be governed by and construed in accordance with the laws of the State of New York.

 

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7.            Headings.
Section headings in this Amendment are included herein for convenience of reference only and shall not constitute a part of this
Amendment for any other purpose.

 

8.            Counterparts;
Electronic Transmission. This Amendment may be executed by the parties hereto in one or more counterparts, each of which shall
be deemed an original and all of which when taken together shall constitute one and the same agreement. Any signature delivered
by a party by facsimile transmission shall be deemed to be an original signature hereto.

 

IN WITNESS WHEREOF, this
Amendment has been duly executed as of the day and year first written above.

 

	 	IM BRANDS, LLC
	 	By:  Xcel Brands, Inc., its Manager
	 	 	 
	 	By:	/s/ Seth Burroughs
	 	 	Name: Seth Burroughs
	 	 	Title: Executive Vice President
	 	 	 
	 	XCEL BRANDS, INC.
	 	 	 
	 	By:	/s/ Seth Burroughs
	 	 	Name: Seth Burroughs
	 	 	Title: Executive Vice President
	 	 	 
	 	BANK HAPOALIM B.M.
	 	 	 
	 	By:	/s/ Robert Schnitzer
	 	 	Name: Robert Schnitzer
	 	 	Title: SVP
	 	 	 
	 	By:	/s/ Michael Barnett
	 	 	Name: Michael Barnett
	 	 	Title: SVP Middle MarketExhibit 10.57

 

 

March 15, 2015

 

Thai Jewelry Manufacturer Co., LTD

620/74-75 Sathupradit Rd.

Soi 44, Yannawa

Bangkok 10120, Thailand

 

Dear Sirs,

 

As you know, in April 2014, we closed a
transaction with Judith Ripka and the Judith Ripka Companies and their affiliates and successors (collectively “Ripka”)
concerning the purchase of the intellectual property (including all trademarks and copyrights, name, image, likeness, business
processes, trade secrets, designs, molds, and materials), and all license agreements and/or other agreements and rights related
to the foregoing (the “Assets”) of Ripka and the potential engagement of certain of their personnel.

 

It is our understanding that Thai Jewelry Manufacturer Co.,
LTD and its subsidiaries, affiliates, principals, officers, successors and assigns (collectively “you” or “Thai”)
have provided Ripka with significant trade credit, and that you are due certain monies from Ripka, which you allege to be in excess
of $5.9 million. We have no way of knowing what the full scope of these monies are or what, if any, other obligations (the “Obligations”)
may be due to you from Ripka, all of which are held by you and have not been assigned to any other party.

 

As discussed, neither our company Xcel
Brands, Inc. nor our acquiring entity JR Licensing, LLC nor any of our affiliates including but not limited to IM Brands, LLC,
IMNY Retail Management, LLC, IMNY Store 1, LLC, IMNY Store – 1 – GA, LLC, IMNY E-Store USA, LLC, nor any of our officers,
members or employees (the “Acquirers”) are affiliated with Ripka, and we will not assume any liabilities or
obligations of Ripka or any of its affiliates, nor will we be responsible for the Obligations.

 

We, therefore, request that you confirm
that you will not look in any way to the Acquirers for payment of or satisfactions of any of the Obligations, nor will you make
any claims whatsoever in any jurisdiction against the Acquirers in connection with the Obligations.

 

475 Tenth Avenue,
4th floor • new york, new york • 10018

Phone: 347-727-2474
• INFO@XCELBRANDS.COM

 

    	 

    	 

    

 

Xcel/Thai Release

March 15, 2015

Page 2

 

As
discussed, we understand that Ripka intends to make a payment to Thai by wire transfer in the amount of $490,000 on March 15, 2015, in accordance with the wire instructions annexed hereto as Schedule 1, in an effort to partially resolve the Obligations
(“Cash Payment”). In addition, on or before March 15, 2015, Ripka will assign to Thai a promissory note originally
issued by Xcel to Judith Ripka, then assigned by Judith Ripka to Judith Ripka Creations, Inc, for a value of USD 2,400,000 payable
in five years from the date of issue, with no interest accruing and in the form as set out in Schedule 2 (“Promissory
Note”), which Promissory Note shall be paid in full by to Xcel on or before March 15, 2015, by transfer to Thai by
Xcel of 266,667 shares of Xcel common stock (the “Xcel Shares”).
Further, on or before March 15, 2015 Ripka will provide Thai with a bill of sale (“Bill of Sale”) thereby
transferring to Thai all right title and interest in certain inventory referenced in Consignment Memo Dated March 20, 2014, (STERLING
SILVER JEWELRY) and Consignment Memo Dated March 20, 2014, (STONE AND PEARL INVENTORY), copies of which are annexed hereto in Schedule
3. 

 

By signing this letter, Thai acknowledges
that effective upon receipt of the Cash Payment, the Xcel Shares and the Bill of Sale, it fully and forever unconditionally and
irrevocably releases the Acquirers and their successors, representatives, shareholders, parent companies, subsidiaries, affiliated
companies and assigns, and does hereby fully and forever discharge and agree to hold the Acquirers harmless from
and against any and all claims and causes of action, in law or in equity, disputes, suits, debts, liens, rights, contracts, agreements,
acts, promises, liabilities, obligations, demands, damages, losses, costs, fees (including, without limitation, those of attorneys)
and expenses, of whatsoever kind or nature, whether known or unknown, suspected or unsuspected, which exist or may have existed
between Thai and Ripka, related to the Note or otherwise. Notwithstanding the foregoing, nothing contained herein shall be construed
or deemed to serve as a release by Thai of Judith Ripka, Ronald Berk and/or the Judith Ripka Companies and their affiliates and
successors with regard to any and all claims and causes of action, in law or in equity, disputes, suits, debts, liens, rights,
contracts, agreements, acts, promises, liabilities, obligations, demands, damages, losses, costs, fees (including, without limitation,
those of attorneys) and expenses, of whatsoever kind or nature, whether known or unknown, suspected or unsuspected, which exist
or may have existed between Thai and Ripka.

 

Please acknowledge your consent on your
behalf and on behalf of your affiliates and the successors, assignors, principals, heirs and representatives of each of the forgoing,
to the release of any and all claims against Acquires for any of the Obligations of Ripka by signing where provided for below.
Thai agrees that it will execute any further documents required to confirm the understanding explicitly set out in this letter
agreement. The Acquirers agree that Thai is under no obligation, at any time, to execute any other documents that deviate, in any
manner whatsoever, from the understanding explicitly set out in this letter agreement. The Acquirers and Thai agree that this letter
agreement and the subject matter thereof shall be interpreted in accordance with and governed by the laws of the State of New York
in the United States of America, without regard to the conflict of laws principles thereof.

 

	 	Xcel Brands, Inc.

 

	 	/s/ Seth Burroughs	 
	 	 	 	 
	 	By: 	Seth Burroughs

	 

 

    	 

    	 

    

 

Xcel/Thai Release

March 15, 2015

Page 3

 

AGREED AND CONSENTED TO:

 

Thai Jewelry Manufacturer Co., LTD

 

	/s/ Samrit Siriaramsakul	 
	 	 	 
	By: 	Samrit Siriaramsakul, Authorized Director

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