Document:

Exhibit 10.29

 

		Original I ssue Di scount Promissory Note Original Issue Date:April 8, 202 l Subscription Amount: $850,000 Principal Amount: $1,000,000 Original Issue Discount (OID): 15% FOR VALUE RECEIVED,DigitalBrands Group,Inc., a Delaware corporation with offices at 1400 Lavaca Street, Aust in,TX 78701(herein "Borrower"), hereby promises to pay to the order ofTarget Capital2 LLC, an Arizona LLC with offices at 13600 Carr 968,apt 64,Rio Grande,PR 00745 (collectively with any and all of its permitted successors and assigns, herein "Lender"),without offset, inimmediately avaiable funds inlawfulmoney of the United States of A merica, without counterclaim or setoff and free and clear of,and without any deduction or withholding for,any taxes or other payments),the Principal Amount of One Million Dollars ($1,000,000) (the "PrincipalAmount"). The loan evidenced by this note(this "Note") is referred to herein as the "Loan". Section 1.Payment Schedule and Maturity Date. The entire PrincipalAmount of this Note then unpaid, together with any accrued and unpaid interest and all other amounts payable hereunder,if any, shall be due and payable in full as a balloon payment on July 8,2021 (the "Maturity Date"),or such earler date as this Note is required or permitted to be repaid as provided hereunder, including if the Borrower completes its initialpublic offering (the "IPO"), before the Maturity Date then the Principa lAmount will be repaidimmediately and infull from the proceeds received by the Borrower from the net proceeds of the IPO. Section 2. Interest. The imputed interest rateis encompassed within the original issue discount of this Note. No additionalcash interest shallbe due. Borrower acknowledges the effect ive annual simple rate of interest stemming from the original issue discount of this Note is sixty percent (60%). Section 3. Equity Incentive.Immediately prior to the effect ive date of the IPO, Borrower willissue Lender a warrant,in form and substance satisfactory to the Borrower (the "Warrant"),for a number of shares equal to 50% of the PrincipalAmount divided by the Exercise Price,where Exercise Price will be set at the time ofIPO pricing and will be equal to the IPO price to the publc per one share of the common stock of the Borrower,and will be issued to the Lenderin conjunct ionwith accepting this Note. Specifically,the number of shares underlying the Warrant (the "Warrant Shares") shall be equalto [(1,000,000)(.S)J/[the IPO price to the publc of one share of Borrower's common stock ). Section 4.Prepayment. Borrower may prepay the PrincipalAmount in full at any time or in part from time to time. Section S. Events of Default. The occurrence of any one or more of the following shall constitute an "Event of Default" under this Note: 

 

    

     

    

		 Event of Default means,wherever used herein,any of the followingevents {whatever the reason for such event and whether such event shall be voluntary orinvoluntary or effected by operat ion of law or pursuant to any judgment, decree or order of any court,or any order,rule or regulation of any administrative or governmental body): Failure to pay all amounts due under this Note withinfive business days after the closing of theIPO, or if suchIPO has not yet occurred,to pay off all amounts due under this Note in full on the Maturity Date; ii.the Borrower shall failto observe or perform any other covenant or agreement contained in this Note,which failureis not cured,if possible to cure,within the earlier to occur of (A) 5 Trading Days after notice of such failure sent by the ender to the Borrower and (B) 10 Trading Days after the Borrower has become or should have become aware of such failure; ii.the Borrower or any Significant Subsidiary (as such term is defined in Rule 102(w) of Regulation S X) shall be subject to a Bankruptcy Event; the Borrowershalldefault on any of its oblgations under any mortgage,credit agreement or other facility,indenture agreement, factoringagreement or other Instrument under which there may be issued,or by which there may be secured or evidenced,any indebtedness for borrowed money or money due under any tong term leasing or factoringarrangement that (a) involves an oblgation greater than $250,000,whether such indebtedness now exists or shall hereafter be created, and (b) results in such indebtedness becoming or being declared due and payable prior to the date on whichit would otherwise become due and payable; the Borrower shall agree to sell or dispose of all or substantially all of its assets in one transaction or a series of related transactions out of the ordinary course of business and any monetary j udgment,writ or similar final process shall be entered or filed against the Borrower,any subsidiary or any of their respective property or other assets for more than$250,000,and such judgment, writ or similar finalprocess shall remain unvacated,unbonded or unstayed for a period of 30 calendar days. Remedies Upon Event of Default. If any Event of Default occurs,the outstanding Principal Amount of this Note,plus accrued but unpaidinterest through the date of acceleration,shall become,at the ender's election,immediately due and payable in cash. Commencing 5 days after the occurrence of any Event of Default that results in the eventual acceleration of this Note,the Default interest Rate on this Note shall accrue at an interest rate equal to the lesser of 15% per annum or the maximum rate permitted under applicable law. Upon the payment in fullof the PrincipalAmount of this Note,plus accrued but unpaidinterest,, the Lender shallpromptly surrender this Note to or as directed by the Borrower. In connection with such acceleration described herein,the Lender need not provide,and the 

 

    

     

    

		Borrower hereby waives, any presentment, demand,protest or other notice of any kind,and the Lender may immediately and without expiration of any grace period enforce any and allofits rights and remedies hereunder and all other remedies available to it under applicablelaw. Such acceleration may be rescinded and annulled by Lender at any time prior to payment hereunder and the Lender shallhave all rights as a holder of the Note untilsuch time,if any, as the Lender receives full payment. No such rescission or annulment shall affect any subsequent Event of Default or impair any right consequent thereon.Additionally, if any Event of Default occurs,the number of Warrants issuable to the Lender under Section 3 shall be increased to 75% of the Principal Amount and the exact number of Warrant Sharesissuable to the Lender shall be equal to ((1,000,000)(.75))/(the price of one share of Borrower's common stock in the Borrower's initial public offer ing). Section 6.Costs and Expenses of Enforcement. Borrower agrees to pay to Lender on demand all costs and expenses incurred by Lender Inseeking to collect this Note or to enforce any of Lender's rights and remedies under this Note,including court costs and reasonable attorneys' fees and expenses, whether or not suitis filed hereon,or whether in connection with bankruptcy, insolvency or appeal. Section 7. Heirs, Successors and Assigns. The terms of this Note shall bind and inure to the benefit of the heirs, devisees, representatives, successors and assigns of the parties.The foregoing sentence shall not be construed to permit Borrower to, and Borrower shall not assign the Loan,or its rights and obligations under this Note without the express written consent of the Lender. Section 8,Notices.Any and all notices or other communications or delveries to be provided by the Lender hereunder, shall be in writingand delivered personally, by facsimile,by emailattachment, or sent by a nationally recognized courier service,addressed to the Borrower,at the address set forth above. Any and all notices or other communications or deliveries to be provided by the Borrower hereunder, sha ll be in writing and delvered personally, by facsimile,by emailatt.achment, or sent by a nationally recognized courier service,addressed to the Lender, at the address set forth above. Section 9. Absolute Obligation.Except as expressly provided herein,no provision of this Note shall alter or impair the obligation of the Borrower, which is absolute and unconditional,to pay the principalof, liquidated damages and accrued interest, as applicable,on this Note at the time,place,and rate,andin the coinor currency, herein prescribed. This Note is a direct debt obligation of the Borrower. Section 10. Lost or Mutilated Note. If this Note shall be mutiated,lost, stolen or destroyed,the Borrower shall execute and deliver,in exchange and subst itution for and upon cancellation of a mutilated Note,or inlieu of or insubstitution for a lost, stolen or destroyed Note,a new Note for the principal amount of this Note so mutilated, lost, stolen or destroyed, but only upon receipt of evidence of such loss, theft or destruction of such Note,and of the ownership hereof,reasonably satisfactory to the Borrower. Section 11. No Usury. Itis expressly stipulated and agreed to be the intent of Borrower and Lender at all times to comply with applicable statelaw or applicable United States federal law (to the extent that it 

 

    

     

    

		permits Lender to contract for,charge,take,reserve,or receive a greater amount of interest than under state law) and that this Section shall controlevery other covenant and agreement in this Note and the Warrant Agreement. If applicable state or federal law should at any time be judicially interpreted so as to render usurious any amount called for under this Note,or contracted for,charged,taken,reserved, or received with respect to the Loan,or if Lender's exercise of the option to accelerate the Maturity Date, orif any prepayment by Borrower results in Borrower having paid any interest inexcess of that permitted by applicablelaw, thenit is Lender's expressintent that allexcess amounts theretofore collected by Lender shall be credited on the principal balance of this Note, and the provisions of this Note shall immediately be deemed reformed and the amounts thereafter collectible hereunder and thereunder reduced,without the necessity of the execution of any new documents, so as to comply with the applicable law, but so as to permit the recovery of the fullest amount otherwise called for hereunder or thereunder. All sums paid or agreed to be paid to Lender for the use of forbearance of the Loan shall,to the extent permitted by applicablelaw,be amortized, prorated,allocated,and spread throughout the fullstated term of the Loan.The Borrower covenants (to the extent that it may lawfully do so) that it shallnot at any time insist upon,plead,or in any manner whatsoever claim or take the benefit or advantage of,any stay, extension or usurylaw or other law which would prohibit or forgive the Borrower from paying all or any portion of the principalof orinterest on this Note as contemplated herein,wherever enacted,now or at any time hereafter in force,or which may affect the covenants or the performance of this Note,and the Borrower (to the extentit may lawfully do so) hereby expressly waives all benefits or advantage of any suchlaw, and covenants that it will not,by resort to any such law, hinder,delay or impede the execution of any power herein granted to the Borrower,but willsuffer and permit the execution of every such as though no suchlaw has been enacted. Section 12. Governing Law. All questions concerning the construction,validity, enforcement and interpretation of this Note shall be governed by and construed and enforcedin accordance with the internal laws of the State of Arizona, without regard to the principles of conflict of laws thereof. Each party agrees that alllega lproceedings concerning the interpretation,enforcement and defense of the transactions contemplated by this Note (whether brought against a party hereto or its respective Affiliates,directors, officers, shareholders, employees or agents) shall be commenced in the state and federalcourts sitting in the City of Peoria,In the State of Arizona (the "Arizona Courts"). Each party hereto hereby irrevocably submits to the exclusive jurisdiction of the Arizona Courts for the adjudication of any dispute hereunder or In connect on herewith or with any transaction contemplated hereby or discussed herein (including with respect to the enforcement of this Note),and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding,any claim that it is not persona lly subject to the jurisdiction of such Arizona Courts,or such Arizona Courts are improper or inconvenient venue for such proceeding. Each party hereby irrevocably waives personal service of process and consents to process beingserved in any such suit,action or proceeding by mailing a copy thereof via registered or certified mailor overn ight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Note and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed tolimit in any way any right to serve process in any other manner permitted by applicable law.Each party hereto hereby irrevocably waives,to the fullest
extent permitted by applicable law, any and all right to trial by 

 

    

     

    

		jury in any legal proceeding arising out of or relating to this Note or the transactions contemplated hereby. Section 13. Waiver. Any waiver by the Borrower or the Lender of a breach of any provision of this Note shall not operate as or be construed to be a waiver of any other breach of such provision or of any breach of any other provision of this Note. The failure of the Borrower or the Lender to insist upon strict adherence to any term of this Note on one or more occasions shall not be considered a waiver or deprive that party of the right thereafter to insist upon strict adherence to that term or any other term of this Note on any other occasion. Any waiver by the Borrower or the ender must be in writing. Section 14.Severability. Ifany provision of this Noteis invalid,illegal or unenforceable,the balance of this Note shall remain in effect, andif any provision is inapplicable to any person or circumstance,it shall nevertheless remain applicable to all other persons and circumstances. Section 15. Headings. The headings contained herein are for conven ience only, do not constitute a part of this Note and shall not be deemed to limit or affect any of the provisions hereof. ********************* (Signature Pages Follow) 

 

    

     

    

		IN WITNESS WHEREOF, the Borrower has caused this Note to beduly executed by a duly authorized officer as of the date first above indicated. DIGITAL BRANDS GROUP,INC. By:._;·;_,_·_.cJ?-;f·v-"' f _ Name: μ, f .P<t vi.; Title:( Email: ft? ,/ cJd) HJ . ICI , 

 

    

     

    

		[LENDER SIGNATURE PAGE TO ORIGINA LISSUE DISCOUNT PROMISSORY NOTE] IN WITNESS WHEREOF,the undersigned have caused this Note to be duly executed by their respective authorized signatories as of the date first indicated above. Name of Lender:Target Capital2 LLC-ef-:;-Signature of Authorized Signatory of Lender: -&--"-""'i f".. .: :..; _' .:::__ Name of Authorized Signatory:Dmitriy ShaPlfO Title of Authorized Signatory:----'M_,,a,,n,-"a' e''-------------------EmailAddress of Authorized Signatory:shapiro.dmitriy@gmail.com Address for Notice to Lender: 13600 Carr 968,apt 64 Rio Grande,PR 00745 Address for Delvery of Securities to Lender ( f not same as address for notice): SSN/TIN,if any:._..8:.6:..2.::9.:...:.0.::.1..::0.:.4..:...__ Subscription Amount: $ 850,000 Number of Warrants: ((1.000,000)(.S)M!he IPO price to the public of one share of Borrower's commonstock IExhibit 10.30

 

		CONSULTING AGREEMENT This Consulting Agreement (the "Agreement") is entered into as of th is s•h day of April, 202 1 (the "Effective Date"), by and between Alchemy Advisory LLC, a Limited Liability Company organized under the laws of Puerto Rico (the "Consultant") and located at 13600 Carr 968, Apt 64, Rio Grande, PR 00745, and Digital Brands Group, Inc., a Delaware corporation (the "Company") and having its principal place of busi ness at 1400 Lavaca Street, Austin, TX 7870 I . The Company and Consultant are collectively refe1Ted to herein as the "Parties". W HEREAS , the Company is an apparel company that sells both direct to consumer and wholesale by focusing on a customer's "closet share" and leveragi ng their data and personalized customer cohorts to create targeted content. WHEREAS, Consultant is operati ng as a financia l and business consultant; WHER EAS, the Com pan y desires to retain Consultant, and Consultant desire to be retained by the Company; NOW, THEREFORE, in consideration of the premises and promises, warranties and representations herein contai ned, it is agreed as follows: I . DUTI ES. (a) The Company hereby engages the Consultant and the Consultant hereby accepts engagement as a strategy busi ness consultant. It is understood and agreed, and it is the express intention of the parties to th is Agreement, that the Consu ltant is an independe nt contractor, and not an employee or agent of the Com pany for any purpose whatsoever. Consultant shall perform all duties and obligations as described in this Section and agrees to be available at such times as may be scheduled by the Company. It is understood , however, that the Consultant will maintain Consultant 's own business i n addition to provid ing services to the Company. The Consultant agrees to promptly perform all services requ i red of the Consu ltant hereunder in an eflicient, professional, trustworthy and businesslike manner. In such capacity, Consultant will utilize only materials, reports, financial information or other documentation that is approved in writing i n advance by the Company. Description of Consu lt ing Services. The Consultant agrees, to the extent reasonably required in ihe conduct of its busi ness with the Company, to place at the disposal of the Com pany its judgment and experience and to p1·ovide financial and business advice to the Company includ ing, but not limited, to (a) bui lding and ma i nta ining a financial model for the Company, (b) help drafting marketi ng materials and presen tations, (c) reviewing the Company's business req uirements and discuss financing and busi nesses opportunities, (d) look for potential investors and ways of growing the business, (e) anything else the Company may reasonably require from the Consultant. TER M. The Tenn of th i s contract is for 6 months, at which point the contract can be extended for another 6 months with the consent of both parties i n writing. COMPENSATION. For services rendered hereunder, the Company shall pay to the Consu l tant a sum or Forty Four Thousand Dollars ($44,000). The cash payment is due with in I 0 days of the signing of th is Agreement. In addition to the cash payment,the Company shall issue Fifty Thousand (50,000) restricted shares of the Com pany's com mon stock (the "Shares") to the Consultant withi n live (5) business days orexecuting this Agreement. For all relevant purposes, 

 

    

     

    

		the num ber of shares to be issued and delivered to the Consultant, shall be appropriately adjusted to ta ke into account any stock split, stock d ividend, reverse stock split, recapital ization , or similar change i n the Company's common stock, wh ich may occur between the date of the execution of this agreement and the Company's initial public offering. If,after six (6) months from the elate of issuance the average per share trad ing price of the Common Stock of the Company over the trail ing seven (7) day period before such date (the "Six Month Price") multipl ied by the nu mber of Shares is below $250,000, the Company shall issue add itional shares of the Company's Common Stock to the Consultant to make up the valuation difference at the Six Month Price. For avoidance of doubt, i f the Six Month Price is $4.00, the valuation shortfall wou ld be $50,000 (50,000 mu lti plied by $4.00 is $50,000 Jess than $250,000) and the Consultant would receive 12,500 add i tiona l shares from the Company. EXPENSES. The Company agrees to reimburse the Consultant from time to time, for reasonable and pre-approved in wri ti ng, including via email, out-of-pocket expenses incurred by Consu l tant i n connection with its activities under this Agreement. INVESTOR REPRESENTATIONS. The Consultant represents and warrants to the Company that: fill The Consultant represents that i t is an "accredited investor" as such term is defined in Rule 50 I (a) of Regulation 0 under the Securities Act of 1933, as amended (the "Secu rities Act"), and acknowledges that the sale contemplated hereby is being made i n reliance, among other th ings, on a private placement exemption to "accredited investors" u nder the Securities Act and similar exemptions under state Jaw. The Consu l tant is acquiring the Shares solely for i n vestment purposes, for the Consultant 's own account (and/or for the accou nt or benefit of its members or affiliates, as permitted , and not with a view to the distri bution thereof and the Consu l tant has no present arrangement to sell the Shares to or through any person or entity. The Consultant acknowledges and understands the Shares are being transferred to it by the C-0mpany in a transaction not invol ving a public offering i n the U nited States within the meaning of the Securities Act. The Shares have not been registered under the Securities Act and, if in the future the Consultant decides to offer, resell, pledge or otherwise transfer the Shares, such Shares may be offered, resold, pledged or otherwise transferred only (A) pursuant to an effective regist ration statement filed under the Securities Act, (B) pursuant to an exemption from registration under Rule 144 promulgated under the Securities Act, if available, or (C) pursuant to any other available exem ption from the registration requ irements of the Securities Act, and in each case in accordance with any applicable Shares laws of any state or any other jurisd iction. Consu ltant agrees that if any transfer of its Shares or any i nterest therei n is proposed to be made, as a cond ition precedent to any such transfer, the Consultant may be required to deliver to the Company an opinion of counsel satisfactory to the Company with respect to such transfer. Absent registration or another available exemption from registrat ion, the Consultant agrees i t wi l l not 1·esel l. the Shares. The Consultant is sophisticated in financial matters and is able to evaluate the risks and benefits of the investment i n the Shares. 

 

    

     

    

		The Consultant is aware that an investmen t in the Shares is highly speculative and subject to substantial risks because,among other things, the Shares are subject to transfer restrictions and have not been registered u nder the Securities Act and therefore cannot be sold unless subsequently registered under the Securities Act or an exemption from such registration is available. The Consultant is able to bear the econom ic risk of its i nvestment in tJ1e Shares for an indefinite period of time. The Consu l tant, in mak ing the decision to acquire the Shares, has rel ied upon an i ndependent investigation of the Company and has not relied upon any information or representations made by any th ird parties or upon any oral or written representations or assurances from the Company, its officers,directors or employees or any other representatives or agents of the Company. The Consultant is familiar with the business, operations and financial cond i tion of the Com pany and has had an oppo1tun ity to ask questions of, and receive answers from the Company's officers and d irectors concerning the Company has had full access to such other information concerni ng the Company as the Consu l tant has requested. CONFIDENTIA LITY. A ll knowledge and infonnat.ion of a proprietary and confidential nature relating to the Company wh ich the Consu l tant obtains during the Consulting period, from the Com pany or the Company's employees, agents or Consultants shall be for all purposes regarded and treated as strictly confidential for so long as such information remains proprietary and con fidential and shall be held in trust by the Consu ltant solely for the Company's benefit and use and shall not be d irectly or indirectly d isclosed by the Consultant to any person without the prior written consent of the Company, wh ich consent may be withhold by the Company in its sole discretion. fNDEPENDENT CONTRACTOR STATUS. Consultant understands that since the Consultant is not an employee of the Company, the Company will not withhold i ncome taxes or pay any employee taxes on its behalf, nor will it receive any fringe benefits. The Consultant shall not have any authority to assu me or create any obligations, express or implied, on behalf of the Company and shall have no authority to represent the Company as agent, employee or i n any other capacity that as herein provided. TERMfNAT! ON. This Agreement may be terminated by mutual consent of both parties at any time, provided, however, that termination shall not relieve the Company from paying the compensation already accrued. NO THIRD-PARTY RIGHTS. The parties warrant and represent that they are authorized to enter i nto this Agreement and that no th i rd pa1ties, other tJ1an the parties hereto, have any interest in any of the servic.es contemplated hereby. 10. ABSENCE OF WA RRANTIES AND REPRESENTATIONS. Each party hereto acknowledges that they have signed th is Agreement without havi ng relied upon or being induced by any agreement, warranty or representation of fact or opin ion of any person not expressly set fotth herein. All representations and warranties of either party contained herein shall survive its signing and delivery. 1 1 . GOVERNING LA W. This Agreement shall be governed by and construed in accordance with the law of the State of New York. 

 

    

     

    

		I 2. ATTORNEY 'S FEES. In the event of any controversy, claim or dispute between the pa1ties hereto, arising out of or in any manner relating to this Agreement, including an attempt to rescind or set aside, the prevail ing party in any act ion brought to settle such controversy, cla im or d ispute shall be entitled to recover reasonable attorney's fees and costs. I 3. VALIDITY. If any paragraph, sentence, term or provision hereof shall be held to be invalid or unenforceable for any reason, such invalidity or unenforceabi l ity shall not affect the validity enforceability of any other paragraph, sentence, term and provision hereof. To the extent required, any paragraph, sentence, term or provision of this Agreement may be modified by the patties hereto by written amendment to preserve its validity. 14.NO-DISCLOSUR E OF TERMS. The terms of th is Agreement shall be kept confidentia l , and no party, representative, attorney or family member shall reveal its contents to any third party except as required by Jaw or as necessary to comply with law or preexisti ng contractual commitments. 1 5. ENTIRE AGREEMENT. This Agreement contai ns the entire understand ing of the parties and cannot be altered or amended except by an amendment duly executed by all pait ies hereto. This Agreement supersedes and replaces any and al I previous agreements between the pa1ties. This Agreement shall be bind ing upon and in u re to the benefit of the successors, assigns and personal representatives of the parties. 

 

    

     

    

		IN W ITNESS WHEREOF, the patties hereto have executed this Agreement effective as of the date fi rst written above. The Com panyThe Consultant Digital Brands Grou p, Inc. a Delaware Corporation By: Hil Davis CEO Alchemy Ad\'isory LLC a Puerto Rico limited Liability Company

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