UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934
November 30, 2021 (November 24, 2021)
Date of Report (Date of earliest event reported):
THE GREENROSE HOLDING COMPANY INC.
(Exact name of registrant as specified in its charter)
| Delaware | 001-39217 | 84-2845696 | ||
|
(State or other jurisdiction of
incorporation or organization) |
(Commission File Number) |
(I.R.S. Employer
Identification Number) |
|
111 Broadway Amityville, NY |
11701 | |
| (Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, including area code: (516) 346-6270
GREENROSE ACQUISITION CORP.
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation to the registrant under any of the following provisions:
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☒
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Securities registered pursuant to Section 12(b) of the Act:
| Title of Each Class | Name of Each Exchange on Which Registered | |
| Common stock, par value $0.0001 per share | OTCQX | |
| Redeemable warrants, exercisable for shares of common stock at an exercise price of $11.50 per share | OTCQB |
Item 1.01 Entry into a Material Definitive Agreement
Amendment To Theraplant Merger Agreement
On November 26, 2021, The Greenrose Holding Company, Inc. (formerly known as Greenrose Acquisition Corp.) (“Greenrose” or the “Company”) entered into an amendment (the “Amendment No. 2”) to the Agreement and Plan of Merger dated as of March 12, 2021, by and among Greenrose Acquisition Corp., GNRS CT Merger Sub, LLC, Theraplant, LLC (“Theraplant”) and Shareholder Representative Services LLC, as amended (the “Merger Agreement”).
Pursuant to Amendment No. 2, the “Aggregate Consideration” to be paid by Greenrose in respect of the Theraplant merger will equal “Cash Consideration” in the amount of One Hundred Million Dollars ($100,000,000), minus the escrow amount, the expense amount, the Managing Member Expense Amount (as defined in the Merger Agreement), and the Deferred Cash Payment Amount described below. Furthermore, Aggregate Consideration would include the amount equal to the difference between the Estimated Closing Net Working Capital and the Base Net Capital (each as defined in the Merger Agreement). The Aggregate Consideration would include the amount released from the Escrow and Expense Fund, the amount released from the Managing Member Expense Fund, and the Stock Consideration comprised of five million (5,000,000) unregistered shares of Greenrose common stock valued at $10.00 per share, valued in the aggregate amount of Fifty Million Dollars ($50,000,000). The Merger Agreement as amended provides that the Stock Consideration is subject to upward adjustment in the event a registration statement covering the resale of the Stock Consideration has not been declared effective 7 days after the Merger and the Parent Stock Price is less than $10.00 per share. In such circumstances, Greenrose has agreed to issue additional Parent Common Stock in such number of additional shares of Parent Common Stock, to be confirmed by the Theraplant Steering Committee, that, when multiplied by the Parent Common Stock Price (determined pursuant to the Merger Agreement) would increase the Stock Consideration to $50,000,000; provided that the number of shares of additional Common Stock Greenrose shall issue shall not exceed $5,000,000 in additional Parent Stock.
Amendment No. 2 provides for a Deferred Cash Payment Amount in the amount of ten million dollars ($10,000,000) plus simple interest at the rate of nine percent (9%) per annum, payable in equal monthly installments during the first twelve months following the closing of the merger contemplated by the Merger Agreement. The Deferred Cash Payment Amount may, at the election of the Theraplant Steering Committee, be converted (in whole or in part and at any time or from time to time), into common stock of Greenrose at a price per share of $10.00, subject to adjustment.
Any agreement of Greenrose with any third-party financing source shall expressly permit payment by Greenrose of the Deferred Cash Payment Amount (either in cash or common stock of Greenrose) (i) with respect to the first six monthly payments, without restriction, and (ii) with respect to the last six monthly payments, subject solely to blockage by the such financing source as a result of an Event of Default (as defined in the credit agreement between Greenrose and such financing source) as a result of a payment default or in the event such financing source accelerates its loan to Greenrose.
The foregoing description of the Amendment No. 2 is qualified in its entirety by reference to the full text of the Amendment No. 2, which is attached hereto as Exhibit 2.1 and is incorporated herein by reference.
Item 5.03 Amendments to Articles of Incorporation or ByLaws; Change in Fiscal Year
On November 24, 2021, the Company filed an amended and restated certificate of incorporation in the form approved by Greenrose stockholders at the Special Meeting of the Company held October 27,2021 (the “Certificate of Incorporation”) with the Secretary of State of the State of Delaware, which became effective on the same date, pursuant to which the Company changed its name from “Greenrose Acquisition Corp.” to “The Greenrose Holding Company Inc.”
The foregoing description of the Certificate of Incorporation is qualified in its entirety by the full text of the Certificate of Incorporation, which is attached hereto as Exhibit 3.1 and is incorporated herein by reference.
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Forward Looking Statements
Certain statements made in this release are “forward looking statements” within the meaning of the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995. When used in this press release, the words “estimates,” “projected,” “expects,” “anticipates,” “forecasts,” “plans,” “intends,” “believes,” “seeks,” “may,” “will,” “should,” “future,” “propose” and variations of these words or similar expressions (or the negative versions of such words or expressions) are intended to identify forward-looking statements. These forward-looking statements are not guarantees of future performance, conditions or results, and involve a number of known and unknown risks, uncertainties, assumptions and other important factors, many of which are outside Greenrose’s or its target companies’ control, that could cause actual results or outcomes to differ materially from those discussed in the forward-looking statements. Important factors, among others, that may affect actual results or outcomes include: liquidity of Greenrose’s stock; costs related to the proposed business combinations; Greenrose’s ability to manage growth; Greenrose’s ability to identify and integrate other future acquisitions; rising costs adversely affecting Greenrose’s profitability; competition in the legal cannabis industry; adverse changes to the legal environment for the cannabis industry; and general economic and market conditions impacting demand for Greenrose’s products and services. Readers should not unduly rely on any projections or other forward-looking statements or data contained herein.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
| Exhibit No. | Description | |
| 2.1 | Amendment No. 2 to the Agreement and Plan of Merger dated as of March 12, 2021, by and among Greenrose Acquisition Corp., GNRS CT Merger Sub, LLC, Theraplant, LLC and Shareholder Representative Services LLC, as amended | |
| 3.1 | Amended and Restated Certificate of Incorporation of The Greenrose Holding Company, Inc. | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
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SIGNATURE
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.
| THE GREENROSE HOLDING COMPANY INC. | ||
| Date: November 30, 2021 | By: | /s/ William F. Harley III |
| Name: | William F. Harley III | |
| Title: | Chief Executive Officer | |
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Exhibit 2.1
AMENDMENT NO. 2 TO MERGER AGREEMENT
This AMENDMENT NO. 2 (this “Amendment”) to the AGREEMENT AND PLAN OF MERGER (the “Merger Agreement”), by and among THERAPLANT, LLC, a Connecticut limited liability company (the “Company”), Greenrose Acquisition Corp, a Delaware corporation (“Parent”), GNRS CT Merger Sub, LLC, a Delaware limited liability corporation (“Merger Sub”), and Shareholder Representative Services LLC, a Colorado limited liability company solely in its capacity as the representative of the Selling Securityholders (the “Selling Securityholders’ Representative”), is entered into on November 26, 2021. Terms used but not otherwise defined herein shall have the meanings assigned to such terms in the Merger Agreement.
WITNESSETH:
WHEREAS, reference is hereby made to the Merger Agreement as amended to date (capitalized terms used but not defined herein shall have the meaning given such terms in the Merger Agreement); and
NOW, THEREFORE, in accordance with Section 9.11 of the Merger Agreement, in consideration of the mutual promises and covenants contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Merger Agreement is hereby amended as follows:
| 1. | The following terms are added to Section 10.1 Definitions in alphabetical order: |
““Deferred Cash Payment Amount” shall mean Ten Million ($10,000,000) plus simple interest thereon at the rate of nine percent (9%) per annum, payable in equal monthly installments during the first twelve months following Closing. The Deferred Cash Payment shall be payable to Paying Agent on behalf of the Company Members for further distribution to the Company Members in accordance with the Allocation Certificate. The Deferred Cash Payment Amount may, at the election of the Theraplant Steering Committee, be converted (in whole or in part and at any time or from time to time) into Parent Common Stock at a price per share of $10.00, subject to adjustment as provided in Section 1.6 of the Merger Agreement.”
““Financing Sources” shall mean the Persons that that have committed to provide or arrange or have otherwise entered into agreements in connection with any financing in connection with the transactions contemplated hereby and any permitted assignees thereof, together with their Affiliates and their respective officers, directors, employees, agents and representatives involved in such financing and their respective successors and assigns.”
| 2. | Section 1.6 of the Merger Agreement is hereby amended by replacing Section 1.6 of the Merger Agreement in its entirety with the following: |
1.6 Aggregate Consideration. The aggregate amount (including any amounts withheld pursuant to Section 1.13) of consideration to be paid or issued by Parent in respect of all Company Units shall be an amount (the “Aggregate Consideration”) equal to the sum of the amounts set forth in the following subsections (a) through (g):
(a) an amount equal to (i) One Hundred Million Dollars ($100,000,000), minus (ii) the Escrow Amount, minus (iii) the Expense Amount, minus (iv) the Managing Member Expense Amount, (v) minus the Deferred Cash Payment Amount (the sum of preceding (i)-(v) is defined as, the “Initial Consideration”);
(b) an amount equal to the difference between the Estimated Closing Net Working Capital, as determined in accordance with Section 1.13, and the Base Net Working Capital, to the extent a positive number, if any;
(c) the amount released from the Escrow Fund pursuant to Section 7.5(a), if any;
(d) the amount released from the Expense Fund pursuant to Section 9.13(c), if any;
(e) the amount released from the Managing Member Expense Fund pursuant to Section 9.17, if any; and
(f) Stock Consideration comprised of unregistered shares of Parent Common Stock valued at $10.00 per share payable with respect to the Initial Consideration in the aggregate amount of Fifty Million Dollars ($50,000,000), and with respect to any conversion of the Deferred Cash Payment Amount, issuable to the Selling Securityholders in share amounts specified in writing to Parent by the Theraplant Steering Committee.
The number of shares of Parent Common Stock comprising the Stock Consideration portion of the Initial Consideration is subject to upward adjustment in the event that the Registration Statement filed pursuant to the Registration Agreement has not been declared effective 75 days after the completion of the Merger and the Parent Common Stock Price is less than $10.00 per share. If the Parent Common Stock Price is less than $10.00 per share, Parent shall cause to be issued to Selling Securityholders, in amounts to be confirmed by the Theraplant Steering Committee, that number of additional shares of Parent Common Stock which, multiplied by the Parent Common Stock Price, adds additional Stock Consideration in such amount that aggregate Stock Consideration to the Company’s equity holders equals $50,000,000 (using the Parent Common Stock Price); provided, however, any obligation of Parent to issue such additional shares of Parent Common Stock shall not exceed Five Million Dollars ($5,0000,000) of additional Parent Common Stock, valued at the Parent Common Stock Price. The number of shares of Parent Common Stock comprising the Common Stock into which the Deferred Cash Payment Amount may be converted is subject to adjustment in the event the Parent Common Stock Price is less than $10.00 per share at the time of conversion such that the number of shares issuable upon conversion constitutes Stock Consideration in the amount of $10,000,000 (using the Parent Common Stock Price at time of conversion); provided however, any obligation of Parent to issue such additional shares of Parent Common Stock with respect to conversion of the Deferred Cash Payment Amount shall not exceed One Million Dollars ($1,000,000).
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(g) Parent shall pay the Deferred Cash Payment Amount, as it becomes due and payable and with accrued interest thereon, to Paying Agent on behalf of the Company Members for further distribution by Paying Agent to the Company Members in accordance with the Allocation Certificate. Any agreement with any Financing Sources shall expressly permit payment by Parent of the Deferred Cash Payment Amount (either in cash or Parent Common Stock) (i) with respect to the first six monthly payments, without restriction, and (ii) with respect to the last six monthly payments, subject solely to blockage by the Financing Source as a result of an Event of Default (as defined in the credit agreement between Greenrose and the Financing Source) as a result of a payment default or the Financing Source accelerating the loan.
To provide assurance on payment of the Deferred Cash Payment Amount, Parent shall establish, for the benefit of the Company Members, a separate account to be funded at all times with two months’ of payments on the Deferred Cash Payment Amount. It is expected that funding from such account will be from Company revenue, though funding can be from other sources as well. Parent agrees to maintain the amount available in such account for the benefit of the Company Members, until such time as the Deferred Cash Payment Amount has been paid to the Company Members in full, or all of such amount has been converted in accordance with this Section. Parent grants to the Steering Committee and its designated agents or representatives the right to review and inspect the records of Parent and the Company to confirm such account is operating in accordance with this paragraph.
3. Investment held by TPT Holdings, LLC. Parent and the Company agree that for purposes of calculating the New Working Capital of the Company, the Company’s indirect investment in LLL shall be disregarded. Parent and the Company agree that any proceed realized from the disposition of the Company’s investment in LLL held by TPT Holdings, LLC shall be split evenly (50-50), and the proceeds due to the Company from any such disposition shall be distributed to the Selling Securityholders through the Paying Agent in the same manner as Closing proceeds are distributed to the Selling Securityholders.
4. Section 5.14 of the Merger Agreement is hereby adding the following sentence to the end of Section 5.14 of the Merger Agreement:
“Company and the Selling Securityholders shall, at the sole expense of Parent, provide such cooperation as may be reasonably requested by Parent in connection with any proposed third-party financing to be provided in connection with the transactions contemplated hereby.”
5. Section 9.3 of the Merger Agreement is hereby amended by adding the following to the end of Section 9.3 of the Merger Agreement in its entirety with the following:
“Notwithstanding the foregoing, the Financing Sources are intended to be third-party beneficiaries of each of Sections 9.4 (No Assignment; Binding Effect), 9.8 (Waiver of Trial by Jury), 9.11 (Amendment and Modification) and 9.18 (No Liability of Funding Sources).”
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6. Section 9.4 of the Merger Agreement is hereby amended by replacing Section 9.4 of the Merger Agreement in its entirety with the following:
“9.4 No Assignment; Binding Effect. Neither this Agreement nor any right, interest or obligation hereunder may be assigned (by operation of Law or otherwise) and any attempt to do so shall be void; provided, however that Parent or Merger Sub shall be entitled to assign its rights, duties and obligations hereunder, including Merger Sub’s obligation to merge with the Company, to (1) any one or more Subsidiaries or Affiliates of Parent or Merger Sub or (2) any Financing Sources providing purchase money or other financing to Parent or Merger Sub as collateral security for such financing, so long as the applicable collateral security agreement requires any party foreclosing on this Agreement or otherwise enforcing their security interest in this Agreement to assume Parent’s obligations hereunder, provided that in the case of each of (1) and (2) of the foregoing, no such assignment shall relieve Parent or Merger Sub from its duties and obligations under this Agreement. Subject to the foregoing sentence, this Agreement is binding upon, inures to the benefit of and is enforceable by the parties and their respective successors and assigns.
7. Section 9.7 of the Merger Agreement is hereby amended by adding the following to the end of Section 9.7 of the Merger Agreement:
“Notwithstanding the foregoing, each Party hereto agrees that any claim, controversy or dispute arising under or related to this Agreement (whether based on contract, tort, equity or otherwise) involving the Financing Sources shall be governed by and construed in accordance with the laws of the State of New York, without regard to conflicts of laws principles thereof that would require the application of the Laws of another jurisdiction.”
8. Section 9.8 of the Merger Agreement is hereby amended by replacing Section 9.8 of the Merger Agreement in its entirety with the following:
“9.8 Waiver of Trial by Jury. THE PARTIES TO THIS AGREEMENT EACH HEREBY WAIVE, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION, OR CAUSE OF ACTION (I) ARISING UNDER THIS AGREEMENT OR (II) IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES IN RESPECT OF THIS AGREEMENT OR ANY OF THE TRANSACTIONS RELATED HERETO INCLUDING, WITHOUT LIMITATION, RELATING TO THE FINANCING SOURCES AND ANY THIRD PARTY FINANCING RELATED TO THE TRANSACTION CONTEMPLATED HEREBY, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER IN CONTRACT, TORT, EQUITY, OR OTHERWISE. THE PARTIES TO THIS AGREEMENT EACH HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION, OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY AND THAT THE PARTIES MAY FILE AN ORIGINAL COUNTERPART OF A COPY OF THIS AGREEMENT WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE PARTIES TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.”
9. Section 9.11 of the Merger Agreement is hereby amended by adding the following to the end of Section 9.11 of the Merger Agreement in its entirety with the following:
“Notwithstanding the foregoing, no amendments or modifications of, or supplements to the portions of Sections 9.4 (No Assignment; Binding Effect), 9.7 (Governing Law), 9.8 (Waiver of Trial by Jury), this 9.11 (Amendment and Modification) and 9.18 (No Liability of Funding Sources) relating to the Financing Sources shall be permitted, whether directly or indirectly, without the prior written consent of the Financing Sources.”
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9. The Merger Agreement is hereby amended by adding the following as a new Section 9.18 of the Merger Agreement:
“Notwithstanding anything in this Agreement to the contrary, each of the Company and the Selling Securityholders’ Representative agrees that it will not bring or permit any of its respective Affiliates to bring any claim or action (whether at law, in equity, in contract, in tort or otherwise) against any Persons (other than Parent or Merger Sub) that have committed to provide or otherwise enter into contracts in connection with a third-party financing of the transactions contemplated hereby, and the Financing Sources shall have no liability or obligations to Company or the Selling Securityholders’ Representative or any of their Affiliates hereunder, arising out of or in connection with this Agreement or the proposed financing; provided that the foregoing shall not operate as a waiver or release of any claims arising under any actual assumption (i.e. not a collateral assignment) of this Agreement by any Financing Source. In addition, in no event will any Financing Source be liable for consequential, special, exemplary, punitive or indirect damages (including any loss of profits, business or anticipated savings) or damages of a tortious nature.”
10. The parties agree to coordinate the public disclosure of this Amendment as promptly as practicable in accordance with applicable law and the terms of the Merger Agreement as amended hereby on a Form 8-K to be timely filed by Parent with the Securities and Exchange Commission.
11. Parent and the Company agree to cooperate in good faith and to take such further actions as may be reasonably required to give full force and effect to this Amendment (including, without limitation, by preparing and executing revised or additional Transaction Documents (including, but not limited to, the Registration Rights Agreements and any amendment thereto to include for registration Parent Common Stock issuable upon conversion of all or any portion of the Deferred Cash Payment Amount) and/or updating applicable disclosure schedules, including (without limitation) with respect to Sections 2.15 and 4.1(d)(i). Except as amended hereby, the terms and provisions of the Merger Agreement shall remain in full force and effect, and the Merger Agreement is in all respects confirmed. On and after the date of this Amendment, each reference in the Merger Agreement to the “Agreement”, “hereinafter”, “herein”, “hereunder”, “hereof”, or words of similar import shall mean and be a reference to the Merger Agreement as amended by this Amendment.
12. This Amendment may be executed in one or more counterparts (including by means of facsimile signature pages or other electronic means), all of which shall be considered one and the same agreement and shall become effective when one or more such counterparts have been signed by each of the parties and delivered to the other party.
[Remainder of Page Intentionally Left Blank; Signature Page Follows]
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IN WITNESS WHEREOF, the parties have caused this Amendment to be signed by their duly authorized representatives, all as of the date first written above.
| GREENROSE ACQUISITION CORP. | ||
| By: | /s/ William F. Harley III | |
| Name: | William F. Harley III | |
| Title: | Chief Executive Officer | |
| GNRS CT MERGER SUB, LLC | ||
| By: | /s/ William F. Harley III | |
| Name: | William F. Harley III | |
| Title: | Manager | |
|
THERAPLANT, LLC,
acting by and through its Steering Committee |
||
| By: | /s/ Daniel Emmans | |
| Name: | Daniel Emmans | |
| Title: | Steering Committee Member | |
|
SHAREHOLDER REPRESENTATIVE SERVICES LLC,
solely in its capacity as the Selling Securityholders’ Representative |
||
| By: | /s/ Sam Riffe | |
| Name: | Sam Riffe | |
| Title: | Managing Director | |
[Signature Page to Amendment No. 2 to Agreement and Plan of Merger]
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Exhibit 3.1
SECOND AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
THE GREENROSE HOLDING COMPANY INC.
Pursuant to Section 245 of the
Delaware General Corporation Law
Greenrose Acquisition Corp., a corporation existing under the laws of the State of Delaware (the “Corporation”), by its Chief Executive Officer, hereby certifies as follows:
| 1. | The name of the Corporation is “Greenrose Acquisition Corp..” |
| 2. | The Corporation’s was initially named Greenrose Acquisition Corp. and its Certificate of Incorporation was filed in the office of the Secretary of State of the State of Delaware on August 26, 2019. |
| 3. | The Amended Restated Certificate of Incorporation was field in the office of the Secretary of State of Delaware on February 10, 2020. |
| 4. | This Second Amended Restated Certificate of Incorporation restates, integrates and amends the Certificate of Incorporation of the Corporation. |
| 5. | This Second Amended and Restated Certificate of Incorporation was duly adopted by joint written consent of the directors and vote of the stockholders of the Corporation in accordance with the applicable provisions of Sections 141(f), 228, 242 and 245 of the Delaware General Corporation Law (the “DGCL”). |
| 6. | The text of the Certificate of Incorporation of the Corporation is hereby amended and restated to read in full as follows: |
FIRST: The name of the corporation is The Greenrose Holding Company Inc. (hereinafter sometimes referred to as the “Corporation”).
SECOND: The registered office of the Corporation is to be located 251 Little Falls Drive, in the City of Wilmington, County of New Castle, Zip Code 19808. The name of its registered agent at that address is Corporation Service Company.
THIRD: The purpose of the Corporation shall be to engage in any lawful act or activity for which corporations may be organized under the DGCL. In addition to the powers and privileges conferred upon the Corporation by law and those incidental thereto, the Corporation shall possess and may exercise all the powers and privileges that are necessary or convenient to the conduct, promotion or attainment of the business or purposes of the Corporation including, but not limited to, a Business Combination (as defined below).
FOURTH: The total number of shares of all classes of capital stock which the Corporation shall have authority to issue is 151,000,000 of which 150,000,000 shares shall be Common Stock of the par value of $0.0001 per share and 1,000,000 shares shall be Preferred Stock of the par value of $0.0001 per share.
A. Preferred Stock. The Board of Directors is expressly granted authority to issue shares of the Preferred Stock, in one or more series, and to fix for each such series such voting powers, full or limited, and such designations, preferences and relative, participating, optional or other special rights and such qualifications, limitations or restrictions thereof as shall be stated and expressed in the resolution or resolutions adopted by the Board of Directors providing for the issue of such series (a “Preferred Stock Designation”) and as may be permitted by the DGCL. The number of authorized shares of Preferred Stock may be increased or decreased (but not below the number of shares thereof then outstanding) by the affirmative vote of the holders of a majority of the voting power of all of the then outstanding shares of the capital stock of the Corporation entitled to vote generally in the election of directors, voting together as a single class, without a separate vote of the holders of the Preferred Stock, or any series thereof, unless a vote of any such holders is required pursuant to any Preferred Stock Designation.
B. Common Stock. Except as otherwise required by law or as otherwise provided in any Preferred Stock Designation, the holders of the Common Stock shall exclusively possess all voting power and each share of Common Stock shall have one vote.
FIFTH: [Introduction to and Provisions A through J of former article FIFTH relating to target business acquisition period are deleted.]
SIXTH: The following provisions are inserted for the management of the business and for the conduct of the affairs of the Corporation, and for further definition, limitation and regulation of the powers of the Corporation and of its directors and stockholders:
A. Election of directors need not be by ballot unless the by-laws of the Corporation so provide.
B. In furtherance and not in limitation of the powers conferred by the laws of the State of Delaware, the Board of Directors is expressly authorized to make, alter and repeal the by-laws of the Corporation, subject to the power of the stockholders of the Corporation to alter or repeal any by-law whether adopted by them or otherwise.
C. The directors in their discretion may submit any contract or act for approval or ratification at any annual meeting of the stockholders or at any special meeting of the stockholders called for the purpose of considering any such act or contract, and any contract or act that shall be approved or be ratified by the vote of the holders of a majority of the stock of the Corporation which is represented in person or by proxy at such meeting and entitled to vote thereat (provided that a lawful quorum of stockholders be there represented in person or by proxy), unless a higher vote is required by applicable law, shall be as valid and binding upon the Corporation and upon all the stockholders as though it had been approved or ratified by every stockholder of the Corporation, whether or not the contract or act would otherwise be open to legal attack because of directors’ interests, or for any other reason.
D. In addition to the powers and authorities hereinbefore or by statute expressly conferred upon them, the directors are hereby empowered to exercise all such powers and do all such acts and things as may be exercised or done by the Corporation; subject, nevertheless, to the provisions of the statutes of the State of Delaware, of this Certificate of Incorporation, and to any by-laws from time to time made by the stockholders; provided, however, that no by-law so made shall invalidate any prior act of the directors which would have been valid if such by-law had not been made.
SEVENTH: A. A director of the Corporation shall not be personally liable to the Corporation or its stockholders for monetary damages for breach of fiduciary duty as a director, except for liability (i) for any breach of the director’s duty of loyalty to the Corporation or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) under Section 174 of the DGCL, or (iv) for any transaction from which the director derived an improper personal benefit. If the DGCL is amended to authorize corporate action further eliminating or limiting the personal liability of directors, then the liability of a director of the Corporation shall be eliminated or limited to the fullest extent permitted by the DGCL, as so amended. Any repeal or modification of this paragraph A by the stockholders of the Corporation shall not adversely affect any right or protection of a director of the Corporation with respect to events occurring prior to the time of such repeal or modification.
B. The Corporation, to the full extent permitted by Section 145 of the DGCL, as amended from time to time, shall indemnify all persons whom it may indemnify pursuant thereto. Expenses (including attorneys’ fees) incurred by an officer or director in defending any civil, criminal, administrative, or investigative action, suit or proceeding for which such officer or director may be entitled to indemnification hereunder shall be paid by the Corporation in advance of the final disposition of such action, suit or proceeding upon receipt of an undertaking by or on behalf of such director or officer to repay such amount if it shall ultimately be determined that he or she is not entitled to be indemnified by the Corporation as authorized hereby.
EIGHTH: Whenever a compromise or arrangement is proposed between this Corporation and its creditors or any class of them and/or between this Corporation and its stockholders or any class of them, any court of equitable jurisdiction within the State of Delaware may, on the application in a summary way of this Corporation or of any creditor or stockholder thereof or on the application of any receiver or receivers appointed for this Corporation under Section 291 of Title 8 of the Delaware Code or on the application of trustees in dissolution or of any receiver or receivers appointed for this Corporation under Section 279 of Title 8 of the Delaware Code order a meeting of the creditors or class of creditors, and/or of the stockholders or class of stockholders of this Corporation, as the case may be, to be summoned in such manner as the said court directs. If a majority in number representing three-fourths in value of the creditors or class of creditors, and/or of the stockholders or class of stockholders of this Corporation, as the case may be, agree to any compromise or arrangement and to any reorganization of this Corporation as a consequence of such compromise or arrangement, the said compromise or arrangement and the said reorganization shall, if sanctioned by the court to which the said application has been made, be binding on all the creditors or class of creditors, and/or on all the stockholders or class of stockholders, of this Corporation, as the case may be, and also on this Corporation.
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NINTH: A. Unless the Corporation consents in writing to the selection of an alternative forum, the sole and exclusive forum for any stockholder (including a beneficial owner) to bring (i) any derivative action or proceeding brought on behalf of the Corporation, (ii) any action asserting a claim of breach of a fiduciary duty owed by any director, officer or other employee of the Corporation to the Corporation or the Corporation’s stockholders, (iii) any action asserting a claim arising pursuant to any provision of the DGCL, this Certificate of Incorporation or the Corporation’s Bylaws, or (iv) any action asserting a claim governed by the internal affairs doctrine shall be the Court of Chancery of the State of Delaware (or if the Court of Chancery does not have jurisdiction, another state court located within the State of Delaware, or if no state court located within the State of Delaware has jurisdiction, the federal district court for the District of Delaware) in all cases subject to the court’s having personal jurisdiction over the indispensable parties named as defendants.
B. If any action the subject matter of which is within the scope of Section A immediately above is filed in a court other than a court located within the State of Delaware (a “Foreign Action”) in the name of any stockholder, such stockholder shall be deemed to have consented to (i) the personal jurisdiction of the state and federal courts located within the State of Delaware in connection with any action brought in any such court to enforce paragraph A immediately above (an “FSC Enforcement Action”) and (ii) having service of process made upon such stockholder in any such FSC Enforcement Action by service upon such stockholder’s counsel in the Foreign Action as agent for such stockholder.
C. If any provision or provisions of this Article Ninth shall be held to be invalid, illegal or unenforceable as applied to any person or entity or circumstance for any reason whatsoever, then, to the fullest extent permitted by law, the validity, legality and enforceability of such provisions in any other circumstance and of the remaining provisions of this Article Ninth (including, without limitation, each portion of any sentence of this Article Ninth containing any such provision held to be invalid, illegal or unenforceable that is not itself held to be invalid, illegal or unenforceable) and the application of such provision to other persons or entities and circumstances shall not in any way be affected or impaired thereby. Any person or entity purchasing or otherwise acquiring any interest in shares of capital stock of the Corporation shall be deemed to have notice of and consented to the provisions of this Article Ninth.
TENTH: The doctrine of corporate opportunity, or any other analogous doctrine, shall not apply with respect to the Corporation or any of its officers or directors in circumstances where the application of any such doctrine would conflict with any fiduciary duties or contractual obligations they may have as of the date of this Certificate of Incorporation or in the future. In addition to the foregoing, the doctrine of corporate opportunity shall not apply to any other corporate opportunity with respect to any of the directors or officers of the Corporation unless such corporate opportunity is offered to such person solely in his or her capacity as a director or officer of the Corporation and such opportunity is one the Corporation is legally and contractually permitted to undertake and would otherwise be reasonable for the Corporation to pursue.
ELEVENTH: The Securities owned or controlled by an Unsuitable Person or an affiliate of an Unsuitable Person shall be redeemable by the Corporation or the applicable affiliated company of the Corporation, out of funds legally available therefor, as directed by a cannabis licensing authority acting in accordance with applicable law or regulation and, if not so directed, as and to the extent deemed necessary or advisable by the Board of Directors, in which event the Corporation shall deliver a Redemption Notice to the Unsuitable Person or its affiliate and shall redeem or purchase or cause one or more companies affiliated with the Corporation to purchase the Securities on the redemption date and for the redemption price set forth in the redemption notice. From and after the redemption date, such Securities shall no longer be deemed to be outstanding, such Unsuitable Person or affiliate of such Unsuitable Person shall cease to be a stockholder, member, partner or owner, as applicable, of the Corporation or and/or ay company affiliated with the Corporation with respect to such Securities, and all rights of such Unsuitable Person or affiliate of such Unsuitable Person in such Securities, other than the right to receive the redemption price, shall cease. In accordance with the requirements of the redemption notice, such Unsuitable Person or its affiliate shall surrender the certificate(s), if any, representing the Securities to be so redeemed. As used herein the term (i) “Securities” shall mean any security issued by the Corporation or any company affiliated with the Corporation, and (ii) the term “Unsuitable Person” shall mean any individual or entity whose regulatory or criminal records make the Corporation (or any affiliated company of the Corporation) ineligible to obtain or retain a cannabis license in accordance with applicable law as determined or directed by a cannabis licensing authority acting under applicable law or regulation.
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IN WITNESS WHEREOF, the Corporation has caused this Amended and Restated Certificate of Incorporation to be signed by William F. Harley III, its Chief Executive Officer, as of the 24th day of November 2021.
| /s/ William F. Harley III | |
| William F. Harley III | |
| Chief Executive Officer |
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