PUBLIC NOTICE OF UCC SALE: Telos Brands Inc

NOTICE OF PUBLIC DISPOSITION OF

ASSETS OF TELOS BRANDS INC.

September 25, 2023

To:        Attached Service List

From:   Boopos Warehouse LLC.

114 NW 25th Street

Miami, FL 33127

NOTICE IS HEREBY GIVEN that Boopos Warehouse LLC, as a secured party (on behalf of itself and its affiliates, successors, and assigns, individually or collectively, the “Secured Party”), will sell the shares of Telos Acquisition Company 10, LLC, Telos Acquisition Company 11, LLC, Telos Acquisition Company 12, LLC, Telos Acquisition Company 13, LLC, Telos Acquisition Company 16, LLC, Telos Acquisition Company 17, LLC, Telos Acquisition Company 18, LLC, Telos Acquisition Company 19, LLC, (each a “Subsidiary” and collectively, the “Subsidiaries”), of Telos Brands Inc., a California corporation (the “Debtor”), to the highest or otherwise best qualified bidder(s) at a public disposition to be conducted on October 2nd 2023 (the “Sale”).  The Secured Parties shall conduct the Sale in accordance with Article 9-610 and other applicable provisions of the Uniform Commercial Code (the “UCC”) and the Transaction Documents (as defined below) and will conduct the Sale online via Zoom through the offices of:

Brian Testo Associates, LLC
4035 East Thousand Oaks Blvd. Suite 105
Westlake Village, CA 91362.

Pre-qualified bidders may participate in the online Sale.  Contact Brian Testo for more details.

Auctioneer
Brian Testo
Brian Testo Associates, LLC
Phone: 818.592.6592
Cell: 818-312-1699
Email: [email protected]

Pursuant to those certain Secured Convertible Promissory Notes listed and described further on Exhibit A, as applicable, by and between the Secured Party and the Debtor (all documents or instruments evidencing and/or securing the Debtor’s obligations to the Secured Party thereunder, as amended, supplemented, renewed, reaffirmed, or otherwise modified at any time, and from time to time, collectively being the “Transaction Documents”), which the Debtor and the Secured Party agreed to by entering into the agreements and utilizing the proceeds given by the Secured Party, and under Section 9-201 of the UCC, the Debtor granted the Secured Party security interests in those assets of the Debtor in the Secured Party’s possession and described on Exhibit B attached hereto (the “Sale Assets”). The Debtor is in default of its obligations under the Transactions Documents. In total, the Debtor owes not less than $4,124,999.00 plus additional interest and collection costs, including attorneys’ fees. Upon request, the Secured Party will work to provide potential bidders with additional information and/or inspection rights regarding the Sale Assets.

Secured Party seller has designated a stalking horse bidder (the “Stalking Horse Bidder”)¹ as the stalking horse bidder to purchase certain of the Sale Assets at, and for all purposes of, the Sale and the bidding procedures related thereto. Secured Party seller reserves the right, in its sole discretion, to designate another stalking horse bidder prior to the auction. The Stalking Horse Bidder shall be deemed to be a qualified bidder that has submitted a qualified bid for all purposes.

TERMS OF SALE: The Secured Party shall, in its sole discretion, sell the Sale Assets in a single lot or in multiple lots, by way of one or more contracts, and on such terms and conditions as are agreed upon between the Secured Party and any purchaser of the Sale Assets, subject to the Secured Party’s security interests and any other valid liens or security interests in existence.

Any party wishing to bid on the Sale Assets at the Sale should pre-register at www.btesto.com before 11:00 am on October 1, 2023, to ensure any applicable pre-qualification criteria are met. A party may be required to prequalify as a bidder by delivering, if requested, proof (satisfactory to the Secured Party) of such party’s financial ability to consummate a sale of the Sale Assets to counsel for Secured Party at the address listed below or via email to [email protected] before 11:00 am on October 1, 2023. Each prevailing bidder must pay the entire purchase price for its successful bid by wire transfer, certified check, or cashier’s check payable to the Secured Party within three (3) business days after the Secured Party’s acceptance of such prevailing bidder’s bid. The Sale Assets will not be transferred until the entire purchase price is paid.

If any prevailing bidder defaults on payment of the purchase price for any of the Sale Assets, the party that submitted the next highest bid for such Sale Assets shall automatically be deemed to have submitted the prevailing bid, and the Secured Party may, at their option, consummate the sale of such Sale Assets to such bidder.

The Secured Party reserves the right to: (a) submit a “credit bid” for any or all of the Sale Assets; (b) adjourn or cancel the Sale without notice; (c) alter the bidding, auction, or payment procedures for the Sale; (d) abandon or elect not to dispose of certain Sale Assets; and/or (e) reject any and all bids. If the Secured Party accepts bid(s) for any Sale Assets, the Secured Party will provide the prevailing bidder(s) with a bill of sale for such Sale Assets with no representations or warranties of any kind or nature whatsoever. At the time of the Sale, the Secured Party may announce additional disclosures and disclaimers regarding the Sale Assets and additional or alternative terms, conditions, and procedures related to the Sale.

The Secured Party expects to publish notice of its intent to conduct the Sale in advance of the Sale date.

By selling and purchasing the Sale Assets pursuant to the Sale, neither the Secured Party nor any purchaser of the Sale Assets shall assume any liability or obligation whatsoever regarding any debts, expenses, or liabilities of the Debtor or any other person or entity, and all such debts, expenses, and liabilities shall not be assumed or deemed to be assumed by the Secured Party or any purchaser. Neither the Secured Party nor any purchaser shall be, or shall be deemed to be, a “successor” of or to the Debtor or any other person or entity for any purpose.

Except to the extent that such right is waived, and in accordance with Section 9-623 of the UCC, the Debtor, any secondary obligor, or any other secured party or lienholder has a right to redeem the Sale Assets at any time before the Secured Party has disposed of the Sale Assets or has entered into a contract for the disposition of the Sale Assets by tendering fulfillment of all obligations secured by the Sale Assets as well as any expenses reasonably incurred by the Secured Party in retaking, holding, and preparing the Sale Assets for disposition, in arranging for the Sale, and, to the extent provided in the Transaction Documents and not prohibited by law, the Secured Party’s reasonable attorneys’ fees and legal expenses.

All sales of the Sale Assets will be final and made on an “AS IS, WHERE IS”, “WITH ALL FAULTS” basis, and will be made WITHOUT WARRANTY, EXPRESSED OR IMPLIED, AS TO ANY MATTER WHATSOEVER, INCLUDING TITLE, POSSESSION, QUIET ENJOYMENT, THE LOCATION OF OR ACCESS TO THE SALE ASSETS, THE QUALITY, CONTENT, OR CONDITION OF THE SALE ASSETS, AND WITHOUT ANY RIGHT OF SET-OFF OR RECOUPMENT; ADDITIONALLY, THERE ARE NO WARRANTIES, EXPRESS OR IMPLIED, OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR AS TO ANY OTHER MATTER.

OTHER INQUIRIES: The Debtor is entitled to an accounting of the unpaid indebtedness secured by the Sale Assets. The Debtor may request such an accounting (and interested parties may request additional information regarding the Sale or the Sale Assets) by contacting counsel for the Secured Party:

Joseph C. Barsalona II
Pashman Stein Walder Hayden, P.C. 1007 North Orange Street
4th Floor #183,
Wilmington, DE 19801
(302) 592-6497
[email protected]

/s/ Joseph C. Barsalona II
Joseph C. Barsalona II, Esq.
Counsel to Boopos Innovation, Inc.

Service List

Telos Brands, Inc.
230 California Street,
SUITE 301
San Francisco, CA 94111

Exhibit A

List of Secured Convertible Promissory Notes AND Amendments

Secured Convertible Promissory Notes made by TELOS BRANDS, INC. (DE) to BOOPOS WAREHOUSE LLC (DE):

• Made on September 30, 2022 ($976,254) and amended on October 26, 2022 ($961,775) and November 15, 2022 ($896,211); pledged:
  • TELOS ACQUISITION COMPANY 10, LLC (CA) – SNAP PRODUCTS, LLC (PA) – “SNAP PRODUCTS”
  • TELOS ACQUISITION COMPANY 11, LLC (CA) – GOLD COASTAL, LLC (CA) – “GOLD COASTAL”
  • TELOS ACQUISITION COMPANY 16, LLC (CA) – IASISLAB LLC (DE) – “ALL2SHOP”
• Made on September 30, 2022 ($990,878) and amended on October 26, 2022 ($982,359); pledged:
  • TELOS ACQUISITION COMPANY 13, LLC – WHITWORTH ENTERPRISES LLC (TE) – “HUGGAROO”
• Made on October 3, 2022 ($91,297) and amended on October 26, 2022 ($82,954); pledged:
  • TELOS ACQUISITION COMPANY 12, LLC – KOTIONOK LLC (CA) – “KOTIONOK”
• Made on September 30, 2022 ($501,499) and amended on October 26, 2022 ($496,981); pledged:
  • TELOS ACQUISITION COMPANY 18, LLC – TITANIUM BOOKWORKS LLC (CA) – “ME TIME JOY”
• Made on September 30, 2022 ($606,793) and amended on October 26, 2022 ($599,655); pledged:
  • TELOS ACQUISITION COMPANY 17, LLC – OK2WIN, L.L.C. (UT) – “OK2WIN”
• Made on September 30, 2022 ($550,452) and amended on October 26, 202 ($539,873); pledged:
  • TELOS ACQUISITION COMPANY 19, LLC – RECREATION NATION LLC (TX) – “ROYAL BREW”

Exhibit B

Sale Assets

All assets and equity of the Debtor in the possession of the Secured Party, including without limitation:

• 100% of TELOS ACQUISITION COMPANY 10, LLC (CA) – SNAP PRODUCTS, LLC (PA) – “SNAP PRODUCTS”
• 100% of TELOS ACQUISITION COMPANY 11, LLC (CA) – GOLD COASTAL, LLC (CA) – “GOLD COASTAL”
• 100% of TELOS ACQUISITION COMPANY 16, LLC (CA) – IASISLAB LLC (DE) – “ALL2SHOP”
• 100% of TELOS ACQUISITION COMPANY 13, LLC – WHITWORTH ENTERPRISES LLC (TE) – “HUGGAROO”
• 100% of TELOS ACQUISITION COMPANY 12, LLC – KOTIONOK LLC (CA) – “KOTIONOK”
• 100% of TELOS ACQUISITION COMPANY 18, LLC – TITANIUM BOOKWORKS LLC (CA) – “ME TIME JOY”
• 100% of TELOS ACQUISITION COMPANY 17, LLC – OK2WIN, L.L.C. (UT) – “OK2WIN”
• 100% of TELOS ACQUISITION COMPANY 19, LLC – RECREATION NATION LLC (TX) – “ROYAL BREW”

1. The Stalking Horse Bidder will be identified to any interested bidder that executes an applicable non-disclosure agreement.