Item 1.01. Entry into a Material Definitive Agreement.

On May 1, 2023 (the "Closing Date"), Rocky Mountain Chocolate Factory, Inc. (the "Company") completed the sale of substantially all of the assets (the "Sale") of U-Swirl International, Inc. ("Seller"), which operates and offers franchises for the operation of self-serve frozen yogurt stores (the "Business"). The Sale was completed pursuant to an Asset Purchase Agreement (the "Asset Purchase Agreement"), dated May 1, 2023, by and among the Company, as guarantor, Seller and U Swirl, LLC ("Purchaser"), a related company of Fosters Freeze, Inc., a California corporation. Pursuant to the Asset Purchase Agreement, on the Closing Date, Purchaser paid to Seller $2.75 million, consisting of (i) $1.75 million in cash and (ii) $1.0 million evidenced by a three-year secured promissory note in the aggregate original principal amount of $1.0 million (the "Promissory Note").

The Promissory Note has a three-year term, bears interest at a rate equal to five percent (5%) per annum for the first year and does not bear interest thereafter unless there is an event of default thereunder ("Event of Default"). Upon the occurrence and during the continuation of an Event of Default, the rate of interest accruing on the Promissory Note will increase to a rate equal to ten percent (10%) per annum.

The Promissory Note is secured by all the assets and equity interests of Purchaser, its subsidiaries and its direct parent pursuant to a Security Agreement (the "Security Agreement"), dated May 1, 2023, by and among Seller, and Purchaser, Bob Partners X, LLC ("Partners"), U-Swirl Franchising ("Franchising") and U-Swirl Gift Card LLC and a Pledge Agreement (the "Pledge Agreement"), dated May 1, 2023, by and among Purchaser, Seller, Partners and Kishan Patel, Nimesh Dahya, Nealesh Dahya, Sanjay Patel, Ravi Patel and Mina Yu.

In connection with the Sale, Seller agreed to provide certain transition services to Purchaser during the year following Closing, and the Company agreed for a period of four years not to engage or assist others in engaging in a frozen yogurt business similar to the Business.

The foregoing descriptions of the Asset Purchase Agreement, the Promissory Note, the Security Agreement and the Pledge Agreement (collectively, the Agreements") are not complete and are qualified in their entirety by reference to the full text of the Agreements filed as Exhibits 2.1, 10.1, 10.2 and 10.3 to this Current Report on Form 8-K and incorporated herein by reference.

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Item 9.01. Financial Statements and Exhibits.

(d) Exhibits



Exhibit No.   Description

2.1*            Asset Purchase Agreement, dated May 1, 2023.

10.1            Secured Promissory Note, dated May 1, 2023.

10.2            Security Agreement, dated May 1, 2023.

10.3            Pledge Agreement, dated May 1, 2023.

104           Cover Page Interactive Data File (embedded within the inline XBRL document).

* Certain exhibits and schedules to this Exhibit have been omitted in accordance

with Item 601(a)(5) of Regulation S-K. The Registrant agrees to furnish a copy

of all omitted exhibits and schedules to the SEC upon its request.

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