UNITED STATES 

SECURITIES AND EXCHANGE COMMISSION  

WASHINGTON, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

 

PURSUANT TO SECTION 13 OR 15(d) OF THE 

SECURITIES EXCHANGE ACT OF 1934

 

Date of Report (Date of earliest event reported): February 20, 2018

 

INDOOR HARVEST CORP.  

(Exact name of registrant as specified in its charter)

 

Texas 000-55594 45-5577364

(State or other jurisdiction 

of incorporation) 

(Commission 

File Number) 

(IRS Employer 

Identification No.)  

 

5300 East Freeway Suite A 

Houston, Texas  

 

  77020

(Address of Principal Executive Offices) (Zip Code)

 

346-310-3427 

(Registrant’s telephone number, including area code)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

 

☐ 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.☐

 

 

 

 

 

 

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

 

Resignation of Rick Gutshall

 

On February 20, 2018, Mr. Rick Gutshall resigned as Interim Chief Executive Officer of Indoor Harvest Corp (the “Company”).  Mr. Gutshall will remain a member of the Company’s Board of Directors.

 

Appointment of Daniel Weadock

 

On February 20, 2018 , Mr. Daniel Weadock was appointed Chief Executive Officer and Director of the Company.

 

Since August 2017, Mr. Weadock was Co-Founder and CEO of Junebug Technologies, LLC, a next generation microbial biotechnology company focused on developing solutions based on photosynthetic bacteria and other versatile microorganisms. Since 2005, Mr. Weadock also has served as President and CEO of The International in Bolton, Massachusetts, a world class golf and special event destination with its own boutique lodge and signature restaurant. As a change maker, he led a cultural and business transformation, from a very traditional and conservative enterprise to a more modern, open and forward-thinking organization.

 

Prior to 2005, Mr. Weadock served as Vice President of Enterprise Sales for Williams Telecommunications from 2002 through 2004, building a new sales team and opening new doors in global markets. From 1999 through 2001, Mr. Weadock served as Co-Founder and CEO of FilmAxis, an online, broadband virtual film market, where he led business plan development and capital raising. Prior to FilmAxis, Mr. Weadock was an Executive Vice President of Consortio from 1999 through 2000, a Seattle, Washington incubator of internet-based business to business communities, where he led business development.

 

Before joining Consortio, Mr. Weadock spent a year working with Fast Engines as their VP of Sales and President, from 1998 through 1999, his first start up in Cambridge, Massachusetts, a small software development company. Prior to Fast Engines, Mr. Weadock spent more than 10 years with Cable & Wireless Plc in a variety of roles around the world. After landing what was at the time one of the largest wireless deals in Cable & Wireless’ history, Mr. Weadock was awarded a Fellowship to MIT’s Sloan School of Management where he earned a Master of Science in Management.

 

Mr. Weadock is a forward-thinking visionary who will bring his many years of experience as a thought leader and an agent of change to the next stage of the Company’s development. As a member of the board, Mr. Weadock contributes the benefits of his executive leadership and management experience in developing corporate strategy, assessing emerging industry trends, and business operations. The Company believes that his contributions and deep understanding of all aspects of our business, products and markets will provide substantial experience to fuel our corporate growth.

 

There are no family relationships between Mr. Weadock and any of our other officers and directors.

 

Weadock Employment Agreement  

 

On February 20, 2018, the Company entered into an executive employment agreement with Mr. Weadock (the “Weadock Employment Agreement”), pursuant to which Mr. Weadock agreed to act as the Company’s chief executive officer. Pursuant to the terms of the Weadock Employment Agreement, Mr. Weadock initial will not receive a salary. However, effective on the business day after the date on which the Company achieves Capitalization (as hereinafter defined) of $2,000,000 or more, Mr. Weadock’s annual base salary will be $100,000. For purposes of the Weadock Employment Agreement, “Capitalization” means aggregate net cash proceeds received by the Company from (a) the Company’s sale of common stock pursuant to Puts (as such term is defined in the Investment Agreement dated as of October 12, 2017 by and between the Company and Tangiers Global, LLC (the “Investment Agreement”)) under the Investment Agreement, and/or (b) any other sale by the Company of common stock or preferred stock, whether in a public offering or a private placement.

 

 

 

 

In addition, pursuant to the terms of the Weadock Employment Agreement, the Company agreed to grant Mr. Weadock (i) 300,000 shares of restricted stock as soon as administratively practicable following execution of the Weadock Employment Agreement, and (ii) 1,584,202 shares of restricted common stock, consistent with the grant and vesting schedule set forth in the table below; provided, however , that no grant will be made and no shares will be issued with respect to any grant if Mr. Weadock is not employed by the Company as an executive on the respective Date of Grant as set forth in the table below.

 

Date of Grant Number of Shares Date of Vesting
February 20, 2018 99,012 May 20, 2018
May 20, 2018 99,012 August 20, 2018
August 20, 2018 99,012 November 20, 2018
November 20, 2018 99,012 February 20, 2019
February 20, 2019 99,012 May 20, 2019
May 20, 2019 99,012 August 20, 2019
August 20, 2019 99,012 November 20, 2019
November 20, 2019 99,012 February 20, 2020
February 20, 2020 99,012 May 20, 2020
May 15, 2020 99,012 August 15, 2020
August 20, 2020 99,012 November 20, 2020
November 20, 2020 99,012 February 20, 2021
February 20, 2021 99,012 May 20, 2021
May 20, 2021 99,012 August 20, 2021
August 20, 2021 99,012 November 20, 2021
November 20, 2021 99,022 February 20, 2022
Total 1,584,202  

 

If the Company is acquired by, or merged into and with, another entity prior to the last Date of Vesting set forth above (i.e. February 20, 2022), all shares issuable to Mr. Weadock under the Weadock Employment Agreement will become fully vested and non-forfeitable. Mr. Weadock is also eligible to participate in any equity-based incentive compensation plan or program adopted by the Company’s board of directors.

 

The Weadock Employment Agreement has a term of one year, unless Mr. Weadock’s employment is terminated sooner by the board of directors, and the term will be extended for additional one-year periods unless the Company or Mr. Weadock gives the other party at least 30 days’ prior written notice of its intent not to renew. The Weadock Employment Agreement automatically terminates upon Mr. Weadock’s death or total disability. Mr. Weadock may voluntarily terminate the Weadock Employment Agreement at any time by reason of retirement.

 

The Company may terminate Mr. Weadock’s employment at any time for Cause (as hereinafter defined). For purposes of the Weadock Employment Agreement, “Cause” includes termination for:

 

(i) material breach of the Weadock Employment Agreement;

(ii) intentional nonperformance or misperformance of such duties, or refusal to abide by or comply with the reasonable directives of his superior officers and/or the Company’s Board of Directors, or the Company’s policies and procedures;

(iii) Mr. Weadock’s gross negligence in the performance of his material duties under the Weadock Employment Agreement;

(iv) Mr. Weadock’s willful dishonesty, fraud or misconduct with respect to the business or affairs of the Company, that in the reasonable judgment of the President and/or the Board of Directors materially and adversely affects the Company;

(v) Mr. Weadock’s conviction of, or a plea of nolo contendere to, a felony or other crime involving moral turpitude; or

(vi) the commission of any act in direct or indirect competition with or materially detrimental to the best interests of Company that is in breach of Mr. Weadock’s fiduciary duties of care, loyalty and good faith to Company.

 

Cause does not include any actions or circumstances constituting Cause under (i) or (ii) above if Mr. Weadock cures such actions or circumstances within 30 days of receipt of written notice from the Company setting forth the actions or circumstances constituting Cause. In the event Mr. Weadock’s employment under the Weadock Employment Agreement is terminated for Cause, Mr. Weadock shall thereafter have no right to receive compensation or other benefits under the Weadock Employment Agreement.

 

The Company may, upon a majority vote of the board of directors, terminate Mr. Weadock’s employment under the Weadock Employment Agreement without Cause at any time upon 90 days’ prior written notice to Mr. Weadock.

 

The Weadock Employment Agreement contains confidentiality, non-solicitation and non-disparagement provisions.

 

 

 

 

Weadock Director Compensation Agreement

 

On February 20, 2018, the Company also entered into a compensation agreement with Mr. Weadock (the “Director Compensation Agreement”). Pursuant to the terms of the Director Compensation Agreement, the Company agreed to grant Mr. Weadock an aggregate of 240,000 shares of restricted common stock, consistent with the grant and vesting schedule set forth in the table below; provided, however, that no grant will be made and no shares will be issued with respect to any grant, if Mr. Weadock is not a member of the Company’s board of directors on the respective Date of Grant as set forth in the table below.

 

Date of Award Number of Shares Date of Vesting
February 23, 2018 30,000 May 23, 2018
May 23, 2018 30,000 August 23, 2018
August 23, 2018 30,000 November 23, 2018
November 23, 2018 30,000 February 23, 2019
February 23, 2019 30,000 May 23, 2019
May 23, 2019 30,000 August 23, 2019
August 23, 2019 30,000 November 23, 2019
November 23, 2019 30,000 February 23, 2020
Total 240,000  

 

If the Company is acquired by, or merged into and with, another entity prior to the last Date of Vesting set forth above (i.e. February 23, 2022), all shares issuable to Mr. Weadock under the Director Compensation Agreement will become fully vested and non-forfeitable.

 

The Company also agreed to reimburse Mr. Weadock for all reasonable travel and incidental expenses incurred by Mr. Weadock in performing his services and attending meetings as approved in advance by the Company.

 

Weadock Indemnity Agreement

 

Also on February20, 2018, the Company also entered into an indemnity agreement with Mr. Weadock (the “Weadock Indemnity Agreement”). Pursuant to the terms of the Indemnity Agreement, the Company shall use reasonable efforts to obtain and maintain in full force and effect directors’ and officers’ liability insurance (“D&O Insurance”) in reasonable amounts from established and reputable insurers; provided, however, the Company shall have no obligation to obtain or maintain D&O Insurance if the Company determines in good faith that such insurance is not reasonably available, the premium costs for such insurance are disproportionate to the amount of coverage provided, the coverage is reduced by exclusions so as to provide an insufficient benefit, or Mr. Weadock is covered by similar insurance maintained by a subsidiary of the Company. In addition the foregoing, the Company will indemnify Mr. Weadock from certain third party actions, derivative actions and actions where Mr. Weadock is decreased; provided, however, the Company shall not be obligated to indemnify Mr. Weadock for actions including, but not limited to, actions initiated by Mr. Weadock, for any action in which it is determined that the material assertions made by Mr. Weadock in such proceeding were not made in good faith or were frivolous, for any settlements not authorized by the Company, for any actions on the account of Mr. Weadock’s willful misconduct, and for any expenses and the payment of profits arising from the purchase and sale Mr. Weadock of securities in violation of Section 16(b) of the Securities Exchange Act of 1934, as amended, or any similar successor statute; provided, further that, that the Company shall not be obligated to indemnify Mr. Weadock for expenses or liabilities of any type whatsoever which have been paid directly to Mr. Weadock pursuant to the Company’s D&O Insurance policy.

 

The foregoing description of the Weadock Employment Agreement, the Weadock Director Agreement and the Weadock Indemnity Agreement is a summary only, does not purport to set forth the complete terms of the Weadock Employment Agreement, the Weadock Director Agreement or the Weadock Indemnity Agreement, and is qualified in its entirety by reference to the Weadock Employment Agreement, the Weadock Director Agreement and the Weadock Indemnity Agreement, filed as Exhibits 10.1, 10.2 and 10.3, respectively, to this Current Report on Form 8-K and incorporated herein by reference.

 

Item 8.01 Other Events.

 

On February 23, 2018, the Company issued a press release entitled “Indoor Harvest Names Daniel Weadock Chief Executive Officer.” A copy of the press release is filed herewith as Exhibit 99.1 to this Current Report on Form 8-K.

 

Item 9.01 Financial Statements and Exhibits

 

(d) Exhibits.

 

 

 

 

Exhibit No.   Description
     
10.1   Executive Employment Agreement dated February 20, 2018 between Indoor Harvest Corp and Daniel Weadock.
     
10.2   Compensation Agreement dated February 20, 2018 between Indoor Harvest Corp and Daniel Weadock.
     
10.3   Indemnity Agreement dated February 20, 2018 by and between Indoor Harvest Corp and Daniel Weadock.

 

 

 

SIGNATURES

 

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.

 

  INDOOR HARVEST CORP.
     
Date: February 23, 2018 By:   /s/ Daniel Weadock
  Daniel Weadock
  Chief Executive Officer

 

 

 

Indoor Harvest Corp. 8-K

Exhibit 10.1

 

EXECUTIVE EMPLOYMENT AGREEMENT 

 

This Executive Employment Agreement (the “Agreement”) is made as of February 20, 2018 (the “Effective Date”), between Indoor Harvest Corp (the “Company”) and Daniel Weadock (the “Executive”).

 

1. Terms of Employment  

 

(a)   Position. Company hereby employs the Executive to serve as the Company’s Chief Executive Officer, and the Executive accepts such employment with Company, subject to the terms and conditions of this Agreement.

 

(b)    Duties. Executive shall have such duties and responsibilities as may be assigned from time to time by the Board of Directors not inconsistent with the position of Chief Executive Officer. 

 

(c)    Performance. Executive shall faithfully, diligently and to the best of the Executive’s abilities perform Executive’s duties as determined by the Company from time to time. 

 

(d)  Permitted Activities. The Executive shall, during the period of Executive’s employment by the Company, devote his full business time, energy and best efforts to the business and affairs of the Company. The foregoing notwithstanding, the parties hereto recognize and agree that the Executive may engage in passive personal investments and other business activities which do not conflict with the business and affairs of the Company or interfere with the Executive’s performance of his duties hereunder. In this regard, the Executive may participate in the following activities so long as they do not impair the Executive’s ability to fulfill his obligations under this Agreement:

  

(i) serve as an executive in other business endeavors;

(ii) serve on industry, trade, civic or charitable boards or committees;

(iii) engage in charitable activities and community affairs; and

(iv) manage personal investments, as long as such activities do not materially interfere with the performance of Executive’s duties and responsibilities.

 

2. Compensation 

 

(i)            Salary and Salary Adjustment . Upon execution of this Agreement, the Executive will not receive a salary. The Company and the Executive agree that effective on the business day after the date on which the Company achieves Capitalization (as hereinafter defined) of $2,000,000 or more, Executive’s annual base salary will be $100,000. Such annual base salary shall be (i) payable in cash in accordance with the Company’s customary payroll practices, but no less often than monthly, and (ii) prorated for any partial year. For purposes of this Agreement, “Capitalization” means aggregate gross cash proceeds received by the Company from (a) the Company’s sale of common stock pursuant to Puts (as such term is defined in the Investment Agreement dated as of October 12, 2017 by and between the Company and Tangiers Global, LLC (the “Investment Agreement”)) under the Investment Agreement, and/or (ii) any other sale by the Company of common stock or preferred stock, whether in a public offering or a private placement.

  

(ii) Stock Awards

 

(a)           The Company agrees to grant, as soon as administratively practicable following execution of this Agreement, to the Executive (or an entity controlled by the Executive such that the Executive is deemed to be the sole beneficial owner under Rule 13d-3 promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) a total of 300,000 shares of restricted common stock.

  

1

 

 

(b)           In addition, the Company agrees to grant to the Executive (or an entity controlled by the Executive such that the Executive is deemed to be the sole beneficial owner under Rule 13d-3 promulgated under the Exchange Act) an aggregate of 1,584,202 shares of restricted common stock of the Company, consistent with the grant and vesting schedule set forth in the table below; provided, however, that no grant shall be made, and no shares shall be issued with respect to any grant, if the Executive is not employed by the Company as an executive on the respective Date of Grant as set forth in the table below.

  

Date of Grant Number of Shares Date of Vesting
February 20, 2018 99,012 May 20, 2018
May 20, 2018 99,012 August 20, 2018
August 20, 2018 99,012 November 20, 2018
November 20, 2018 99,012 February 20, 2019
February 20, 2019 99,012 May 20, 2019
May 20, 2019 99,012 August 20, 2019
August 20, 2019 99,012 November 20, 2019
November 20, 2019 99,012 February 20, 2020
February 20, 2020 99,012 May 20, 2020
May 15, 2020 99,012 August 15, 2020
August 20, 2020 99,012 November 20, 2020
November 20, 2020 99,012 February 20, 2021
February 20, 2021 99,012 May 20, 2021
May 20, 2021 99,012 August 20, 2021
August 20, 2021 99,012 November 20, 2021
November 20, 2021 99,022 February 20, 2022

  

With respect to each grant set forth in the table above, the shares subject to that grant will only vest if the Executive is employed as an executive of the Company on the Date of Vesting as set forth in the table above. If the Executive is not an employed as an executive of the Company on a particular Date of Vesting, the shares that are subject to that grant will be forfeited by the Executive.

  

If the Company is acquired by, or merged into and with another entity prior to the last Date of Vesting set forth above (i.e. February 20, 2022), all shares issuable to Executive under this Agreement will become fully vested, a certificate representing the shares shall be issued and shall be non-forfeitable.

  

(iii)          Incentive Compensation. During the Term (as hereinafter defined) of this Agreement, the Executive shall be eligible to participate in any equity-based incentive compensation plan or program adopted by the Board of Directors.

  

3. Expenses 

 

(a)   Reimbursement . Company shall pay all reasonable travel, dining and other ordinary, necessary and reasonable business expenses incurred by the Executive in the performance of Executive’s duties under this Agreement, subject to budget and/or other limitations or conditions imposed by the Board of Directors.

  

(b)   Substantiation . The Executive shall, as a condition of any such payment or reimbursement, submit verification, substantiation and documentation of the nature and amount of such expenses in accordance with the policies of Company from time to time.

  

4. Representations and Warranties.

  

Each of the Company and the Executive represents and warrants to the other party that (i) such party is fully authorized and empowered to enter into the Agreement, (ii) entering into the Agreement and, to such party’s knowledge, the performance of such party’s obligations under the Agreement will not violate any agreement between such party and any other person, firm or organization or any law or governmental regulation.

  

5. Confidential Information

  

(a)   Obligation . The Executive agrees to maintain the strict confidentiality of all Confidential Information during the Term of this Agreement and thereafter.

  

(b)   Scope . For purposes of this Agreement, “Confidential Information” shall mean all information and materials of Company, and all information and materials received by Company from third parties (including but not limited to affiliates, subsidiaries, chapters, and members of Company), which are not generally publicly available and all other information and materials which are of a proprietary or confidential nature, even if they are not marked as such.

  

2

 

 

(c) Survival . This Section 5 shall survive the termination of this Agreement indefinitely.

  

6. Intellectual Property

  

(a) Ownership . Executive agrees that all copyrights, trademarks, patents, and other intellectual property rights to works or marks arising in from or in connection with the Executive’s employment by Company are “work made for hire” within the definition of Section 101 of the Copyright Act (17 U.S.C. 101) and shall remain the sole and exclusive property of Company.

  

(b) Assignment of Interest . To the extent any work product is not deemed to be a work made for hire within the definition of the Copyright Act, Executive with effect from creation of any and all work product, hereby assigns, and agrees to assign, to Company all right, title and interest in and to such work product, including but not limited to copyright, all rights subsumed thereunder, and all other intellectual property rights, including all extensions and renewals thereof.

  

(c)   Moral Rights . Executive also agrees to waive any and all moral rights relating to the work product, including but not limited to, any and all rights of identification of authorship and any and all rights of approval, restriction or limitation on use, and subsequent modifications.

 

(d)   Assistance . Executive further agrees to provide all assistance reasonably requested by Company, both during and subsequent to the Term of this Agreement, in the establishment, preservation and enforcement of Company’s rights in the work product.

  

(e)   Return of Property . Upon the termination of this Agreement, Executive agrees to deliver promptly to Company all printed, electronic, audio-visual, and other tangible manifestations of work product, including all originals and copies thereof.

  

7. Non-Solicitation .

  

During the Term of this Agreement and for five years after any termination of this Agreement, Executive will not, without the prior written consent of the Company, either directly or indirectly, on Executive’s own behalf or in the service or on behalf of others, solicit or attempt to solicit, divert or hire away any person employed by the Company, or any customer of the Company unless such entity or employee had a previous relationship with the Executive prior to his position as Executive with the Company.

  

8. Non-Disparagement .

  

Executive will not at any time, during or after the Term of this Agreement, disparage, defame or denigrate the reputation, character, image, products or services of the Company, or of any of its affiliates, or, any of its or its affiliates’ directors, officers, stockholders, members, employees or agents.

  

9. Acknowledgement .

 

Executive expressly acknowledges that the covenants of this Agreement are supported by good and adequate consideration, and that such covenants are reasonable and necessary in terms of duration, scope and geographic area to protect the legitimate business interests of Company.

 

3

 

 

10.   Term of Employment

  

(a)    Initial Term. The term of the Executive’s employment under this Agreement shall commence on the Effective Date and continue until February 20, 2019, unless Executive’s employment is sooner terminated by the Board of Directors.

  

(b)    Automatic Renewal. Commencing on February 20, 2019 and on each anniversary of that date thereafter, the Term shall be extended for an additional one-year period, unless the Company or the Executive gives the other party at least 30 days’ prior written notice of its intention not to renew this Agreement (the initial term, as renewed, the “Term”).

  

11.   Termination of Employment

  

(a)     Termination Upon Death. This Agreement shall terminate automatically upon the death of the Executive.

  

(b)    Automatic Termination Upon Disability . This Agreement shall terminate automatically upon Total Disability of the Executive. For purposes of this Agreement, “Total Disability” means the Executive is unable to perform the duties set forth in this Agreement for a period of 12 consecutive weeks, or 90 cumulative business days in any 12-month period, as a result of physical or mental illness or loss of legal capacity.

  

(c)   Termination Upon Retirement. The Executive may voluntarily terminate this Agreement at any time by reason of Retirement. For purposes of this Agreement, “Retirement” is the cessation by Executive of all full-time employment of any kind.

  

(d)      Termination by the Company For Cause. The Company shall have the right to terminate Executive’s employment under this Agreement at any time for Cause, which termination shall be effective immediately. Termination for “Cause” shall include termination for:

  

(i)      material breach of this Agreement by Executive;

  

(ii)    intentional nonperformance or misperformance of such duties, or refusal to abide by or comply with the reasonable directives of his superior officers and/or the Company’s Board of Directors, or the Company’s policies and procedures;

  

(iii)  Executive’s gross negligence in the performance of his material duties under this Agreement;

  

(iv)    Executive’s willful dishonesty, fraud or misconduct with respect to the business or affairs of the Company, that in the reasonable judgment of the President and/or the Board of Directors materially and adversely affects the Company;

 

(v)    Executive’s conviction of, or a plea of nolo contendere to, a felony or other crime involving moral turpitude; or

  

(vi)   the commission of any act in direct or indirect competition with or materially detrimental to the best interests of Company that is in breach of Executive’s fiduciary duties of care, loyalty and good faith to Company.

  

Cause will not, however, include any actions or circumstances constituting Cause under (i) or (ii) above if Executive cures such actions or circumstances within 30 days of receipt of written notice from the Company setting forth the actions or circumstances constituting Cause. In the event Executive’s employment under this Agreement is terminated for Cause, Executive shall thereafter have no right to receive compensation or other benefits under this Agreement.

  

(e) Termination by the Company Without Cause. The Company may, upon a majority vote of the Board of Directors, terminate the Executive’s employment under this Agreement without Cause at any time upon 90 days’ prior written notice to the Executive, and Executive shall have any right to a claim against the Company for termination under this provision of the Agreement.

 

4

 

 

(f) Change in Control. For purposes of this Agreement, unless the Board determines otherwise, a Change of Control of the Company shall be deemed to have occurred at such time as:

  

(i)     any person (as the term is used in Sections 13(d) and 14(d) of the Exchange Act) is or becomes the beneficial owner (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of voting securities of the Company representing more than 50% of the Company’s outstanding voting securities or rights to acquire such securities except for any voting securities issued or purchased under any employee benefit plan of the Company or its subsidiaries; or

  

(ii)    any sale, lease, exchange or other transfer (in one transaction or a series of transactions) of all or substantially all of the assets of the Company; or

 

(iii)  a plan of liquidation of the Company or an agreement for the sale or liquidation of the Company is approved and completed; or

  

(iv)   the Board determines in its sole discretion that a Change in Control has occurred, whether or not any event described above has occurred or is contemplated.

  

12.   Indemnification.

  

The Company shall indemnify the Executive, to the maximum extent permitted by applicable law and by its certificate of formation, as amended, against all costs, charges and expenses incurred or sustained by the Executive in connection with any action, suit or proceeding to which he may be made a party by reason of being an officer, director or employee of the Company or of any subsidiary or affiliate of the Company or any other corporation for which the Executive serves in good faith as an officer, director, or employee at the Company’s request.

  

13.   General Provisions

  

(a)    Entire Agreement . This Agreement constitutes the entire agreement between the parties, and supersedes all prior agreements, representations and understandings of the parties, written or oral.

  

(b)    Counterparts . This Agreement may be executed in counterparts, each of which shall be deemed to be an original, but all of which, taken together, shall constitute one and the same agreement.

 

(c)    Amendment . This Agreement may be amended only by written agreement of the parties.

  

(d)    Notices . All notices permitted or required under this Agreement shall be in writing and shall be delivered in person or mailed by first class, registered or certified mail, postage prepaid, to the address of the party specified in this Agreement or such other address as either party may specify in writing. Such notice shall be deemed to have been given upon receipt.

  

(e)     Assignment . This Agreement shall not be assigned by either party without the consent of the other party.

  

(f)      Governing Law . This Agreement shall be governed by and construed in accordance with the laws of the State of Texas, without regard to its conflict of laws rules.

 

(g)     No Waiver of Rights . A failure or delay in exercising any right, power or privilege in respect of this Agreement will not be presumed to operate as a waiver, and a single or partial exercise of any right, power or privilege will not be presumed to preclude any subsequent or further exercise, of that right, power or privilege or the exercise of any other right, power or privilege.

  

5

 

 

IN WITNESS WHEREOF , this Agreement has been duly executed this 20th day of February, 2018.

 

EXECUTIVE THE COMPANY

  

Name: Daniel Weadock Name: Rick Gutshall

 

Signature: /s/ Daniel Weadock Signature: /s/ Rick Gutshall

 

6

 

 

 

Indoor Harvest Corp. 8-K

Exhibit 10.2

 

THIS COMPENSATION AGREEMENT (“Agreement”) is made and entered into as of February 20, 2017 (“Effective Date”) between Indoor Harvest Corp. (the “Company”) and Daniel Weadock (the “Director”).

 

1.   Background. The Company’s Board of Directors has elected the Director to serve as member of the Company’s board of directors, effective as of the date hereof, to perform the services of a director (the “Services”). In furtherance thereof, the Company and the Director desire to enter into this Agreement.

 

2.   Term. This Agreement shall commence on the Effective Date and remain in effect until the termination of this Agreement in accordance with the termination provisions of this Agreement.

 

3. Compensation.

 

A.   Expenses. The Company will reimburse the Director for reasonable travel and other incidental expenses incurred by the Director in performing his services and attending meetings as approved in advance by the Company.

 

B.   Stock Awards. The Company agrees to grant to the Director an aggregate of 240,000 shares of restricted common stock of the Company, consistent with the grant and vesting schedule set forth in the table below; provided, however, that no grant shall be made, and no shares shall be issued with respect to any grant, if the Director is not a member of the Company’s board of directors on the respective Date of Grant as set forth in the table below.

 

Date of Award Number of Shares Date of Vesting
February 23, 2018 30,000 May 23, 2018
May 23, 2018 30,000 August 23, 2018
August 23, 2018 30,000 November 23, 2018
November 23 2018 30,000 February 23,2019
February 23, 2019 30,000 May 23, 2019
May 23, 2019 30,000 August 23, 2019
August 23, 2019 30,000 November 23, 2019
November 23, 2019 30,000 February 23, 2020
Total 240,000  

 

If the Company is acquired by, or merged into and with, another entity prior to the last Date of Vesting set forth above (i.e. February 23, 2022), all shares issuable to the Director under this Agreement will become fully vested, a certificate representing the shares shall be issued and shall be non-forfeitable.

 

 

 

 

4. Company’s Proprietary Rights and Non-Disclosure of Confidential Information

 

A.   Obligation. The Director will hold the Company’s Confidential Information, as defined below, in the strictest confidence and will not disclose or use the Confidential Information except as permitted by this Agreement in connection with the Services, unless expressly authorized to act otherwise in writing by an officer of the Company or as otherwise required by law or valid and binding judicial order. The Director’s obligations under this Section shall survive any termination of this Agreement. In addition, the Director recognizes that he will be exposed to and have access to information (including tangible and intangible manifestations) regarding the patents, copyrights, trademarks, and Confidential Information of the Company. The Director acknowledges and agrees that all this information, whether presently existing or developed in the future, which is not the subject of a patent, patent application, copyright, trademark or trade secret either owned by the Director or in the public domain prior to the Effective Date, is the sole property of the Company and its assigns.

 

B.   Confidential Information. “Confidential Information” means trade secrets, confidential information, data or any other proprietary information of the Company. By way of illustration, but not limitation, “Confidential Information” includes (a) information relating to the Company’s technology, including inventions, ideas, processes, formulas, data, know-how, experimental results and techniques; and (b) information regarding plans for research, development, new products, marketing and selling, business plans, budgets and unpublished financial statements, licenses, prices and costs, suppliers and customers and the skills and compensation of the Company’s employees. However, “Confidential Information” does not include information that is (as demonstrated by written evidence):

 

1. already known to the Director at the time of the disclosure;

2. publicly available or becomes publicly available through no breach of the Director or any party under the Director’s dominion and control;

3. independently developed by the Director; or

4. rightfully first received by the Director from a third party other than the Company.

 

C.   No Conflicting Obligations. The Director represents and warrants that the Director’s performance of this Agreement and his service as a director of the Company do not and will not breach or conflict with any agreement to which the Director is or becomes a party.

 

D.   Third-Party Confidential Information. The Director understands that the Company has received and, in the future, will receive from third parties information that is confidential or proprietary (“Third-Party Information”) and is subject to a duty on the part of the Company to maintain the confidentiality of such information and to use it only for certain limited purposes. During the term of this Agreement and thereafter, the Director will hold Third-Party Information in the strictest confidence and will not disclose or use Third-Party Information except as permitted by the agreement between the Company and such third party, unless expressly authorized to act otherwise by an officer of the Company in writing (other than an officer who is also a principal of the Director).

 

5.   Termination. This Agreement shall terminate automatically on the date that the Director ceases to be a director of the Company.

 

 

 

 

6.   No Employment Relationship. Nothing herein shall be construed as creating an employer/employee relationship between the Company and the Director or placing the parties in a partnership or joint venture relationship. The Director will solely maintain the obligation to pay any and all taxes connected with any compensation paid hereunder. The Director agrees and understands that the Company does not currently have, or provide Directors and Officers with insurance, medical, or liability.

 

7. General.

 

A.   Notices. Any notice required or permitted to be given to one party by the other party pursuant to this Agreement shall be in writing and shall be sent by facsimile-mail or personally delivered or sent by United States mail, certified or registered, return receipt requested, first class postage and charges prepaid, addressed to the parties as set forth below, or at such other address as shall be designated in writing as specified above by either party. Notices sent by facsimile or delivered in person shall be effective on the date of delivery. Notices sent by United States mail shall be effective on the third business day following its posting.

 

The Director: Daniel Weadock 

159 Ballville Road 

Bolton, MA 01740 

c/o The International

 

The Company: 

Indoor Harvest Corp. 

5300 East

Freeway Suite A

Houston, TX

77020

 

B.   Assignment of Rights and Delegation of Duties. All rights and duties of the Company under this Agreement shall extend to its successors and assigns.

 

C.   Severable Provisions. The provisions of this Agreement are severable and if anyone or more provisions may be determined to be illegal or otherwise unenforceable, in whole or in part, the remaining provisions, and any partially enforceable provision to the extent enforceable, shall nevertheless be binding and enforceable.

 

D. Waiver. The waiver by one party of a breach of any provision of this Agreement by the other party shall not operate or be construed as a waiver of any previous or subsequent breach of the same or any other provision by the other party.

 

E.   Entire Agreement. This Agreement constitutes the entire agreement of the parties with respect to its subject matter, and may not be changed orally, but only by an agreement in writing signed by the party against whom the enforcement of any waiver, change, modification, extension or discharge is sought.

 

F.   Governing Law. This Agreement is governed in accordance with the laws (other than choice-of-laws principles) of the State of Texas.

 

 

 

 

G.   Miscellaneous. The terms of this Agreement are confidential and no press release or other written or oral disclosure of any nature regarding the terms of this Agreement shall be made by either party without the other party’s prior written approval; however, approval for such disclosure shall be deemed given to the extent such disclosure is required to comply with governmental rules or a valid court order.

 

H.   Counterparts. This Agreement or any subsequent amendment or modification hereto may be executed by facsimile and/or in one or more counterparts, each of which when so executed and delivered shall be deemed an original, but all of which taken together shall constitute but one and the same original. Each party shall accept any such signed faxed counterpart as full execution of this Agreement or any subsequent amendment or modification thereto.

 

I.   Pronouns. The pronouns used herein shall include, where appropriate, either gender or both, singular and plural.

 

J. Authority. The person(s) executing this Agreement hereby represent and warrant that each respectively has the authority to execute this Agreement on behalf of the party for which he is executing.

 

 

 

 

K. Descriptive Headings. The descriptive headings used herein are for convenience of reference only and they are not intended to have any effect whatsoever in determining the rights or obligations of the parties hereto.

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their duly authorized representatives as of the Effective Date.

 

    INDOOR HARVEST CORP.
       
/s/ Daniel Weadock   By: /s/ Rick Gutshall
Daniel Weadock     Name: Rick Gutshall
      Title: Interim CEO

 

 

 

 

Indoor Harvest Corp. 8-K

Exhibit 10.3

 

INDEMNITY AGREEMENT

 

This Indemnity Agreement, effective as of February 20, 2018, is made by and between Indoor Harvest Corp, a Texas corporation with executive offices located at 5300 East Freeway, Suite A, Houston, Texas, 77020 (the “Company”), and Daniel Weadock and Chief Operations Officer of the Company (the “Indemnitee”).

 

RECITALS

 

A. The Company is aware that competent and experienced persons are increasingly reluctant to serve as directors or officers of cannabis related corporations unless they are protected by comprehensive liability insurance or indemnification, due to increased exposure to litigation costs and risks resulting from their service to such cannabis related corporations, and due to the fact that the exposure frequently bears no reasonable relationship to the compensation of such directors and officers;

 

B. The statutes and judicial decisions regarding the duties of directors and officers are often difficult to apply, ambiguous, or conflicting, and therefore fail to provide such directors and officers with adequate, reliable knowledge of legal risks to which they are exposed or information regarding the proper course of action to take;

 

C. Plaintiffs often seek damages in such large amounts and the costs of litigation may be so substantial (whether or not the case is meritorious), that the defense and/or settlement of such litigation is often beyond the personal resources of officers and directors;

 

D. The Company believes that it is unfair for its directors and officers and the directors and officers of its subsidiaries to assume the risk of large judgments and other expense that may be incurred in cases in which the director or officer received no personal profit and in cases where the director or officer was not culpable;

 

E. The Company recognizes that the issues in controversy in litigation against a director or officer of a corporation such as the Company or a subsidiary of the Company are often related to the knowledge, motives and intent of such director or officer, that he or she is usually the only witness with knowledge of the essential facts and exculpating circumstances regarding such matters and that the long period of time which usually elapses before the trial or other disposition of which litigation often extends beyond the time that the director or officer can reasonably recall such matters; and may extend beyond the normal time for retirement or in the event of his or her death, his or her spouse, heirs, executors or administrators, may be faced with limited ability and undue hardship in maintaining an adequate defense, which may discourage such a director or officer from serving in that position;

 

F. Based upon their experience as business managers, the Board of Directors of the Company (the “Board”) has concluded that, to retain and attract talented and experienced individuals to serve as officers and directors of the Company and its subsidiaries and to encourage such individuals to take the business risks necessary for the success of the Company and its subsidiaries, it is necessary for the Company to contractually indemnify its officers and directors and the officers and directors of its subsidiaries, and to assume for itself maximum liability for expenses and damages in connection with claims against such officers and directors in connection with their service to the Company and its subsidiaries, and has further concluded that the failure to provide such contractual indemnification could result in great harm to the Company and its subsidiaries and the Company’s stockholders;

 

G. Section 8.101 of the Business Organizations Code of Texas, under which the Company is organized (“Section 8 of BOC”), empowers the Company to indemnify by agreement its officers, directors, employees and agents, and persons who serve, at the request of the Company, as directors, officers, employees or agents of other corporations or enterprises, and expressly provides that the indemnification provided by Section 8 of BOC is not exclusive;

 

H. The Company, after reasonable investigation prior to the date hereof, has determined that the liability insurance coverage available to the Company and its subsidiaries as of the date hereof is inadequate and/or unreasonably expensive. The Company believes, therefore, that the interest of the Company’s stockholders would best be served by a combination of such insurance as the Company may obtain, or request a subsidiary to obtain, pursuant to the Company’s obligations hereunder, and the indemnification by the Company of the directors and officers of the Company and its subsidiaries;

 

 

 

I. The Company desires and has requested the Indemnitee to serve or continue to serve as a director or officer of the Company and/or the subsidiaries of the Company free from undue concern for claims for damages arising out of or related to such services to the Company and/or a subsidiary of the Company; and

 

J. The Indemnitee is willing to serve, or to continue to serve, the Company and/or the subsidiaries of the Company, provided that he or she is furnished the indemnity provided for herein.

 

AGREEMENT

 

NOW, THEREFORE, the parties hereto, intending to be legally bound, hereby agree as follows:

 

1.  Definitions.

 

(a)  Agent . For the purposes of this Agreement, “agent” of the Company means any person who is or was a director, officer, employee or other agent of the Company or a subsidiary of the Company; or is or was serving at the request of, for the convenience of or to represent the interest of the Company or a subsidiary of the Company as a director, officer, employee or agent of another foreign or domestic corporation, partnership, joint venture, trust or other enterprise; or was a director, officer, employee or agent of a foreign or domestic corporation which was a predecessor corporation of the Company or a subsidiary of the Company, or was a director, officer, employee or agent of another enterprise at the request of, for the convenience of or to represent the interests of such predecessor corporation.

 

(b)  Expenses.  For purposes of this Agreement, “expenses” includes all direct and indirect costs of any type or nature whatsoever (including, without limitation, all attorneys’ fees and related disbursements, and other out-of-pocket costs) actually and reasonably incurred by the Indemnitee in connection with either the investigation, defense or appeal of a proceeding or establishing or enforcing a right to indemnification under this Agreement.

 

(c)  Proceeding.  For the purposes of this Agreement, “proceeding” means any threatened, pending, or completed action, suit or other proceeding, whether civil, criminal, administrative, investigative or any other type whatsoever, by reason of the fact that the Indemnitee is or was an agent of the Company, or any of the Company’s Subsidiaries or affiliates, or by reason of anything done or not done by him or her in any such capacity..

 

(d)  Subsidiary.  For purposes of this Agreement, “subsidiary” means any corporation of which more than 50% of the outstanding voting securities is owned directly or indirectly by the Company, by the Company and one or more other subsidiaries, or by one or more other subsidiaries.

 

2.  Agreement to Serve . The Indemnitee agrees to serve and/or continue to serve as an agent of the Company, at its will (or under separate agreement, if such agreement exists), in the capacity the Indemnitee currently serves as an agent of the Company, so long as he or she is duly appointed or elected and qualified in accordance with the applicable provisions of the Bylaws of the Company or any subsidiary of the Company or until such time as he or she tenders his resignation in writing or he or she is removed from such position, provided, however, that nothing contained in this Agreement is intended to create any right to continued employment by the Indemnitee.

 

3.  Maintenance of Liability Insurance.

 

(a) The Company hereby covenants and agrees that, so long as the Indemnitee shall continue to serve as an agent of the Company and thereafter so long as the Indemnitee shall be subject to any possible proceeding by reason of the fact that the Indemnitee was an agent of the Company, the Company, subject to Section 3(b), shall use reasonable efforts to obtain and maintain in full force and effect directors’ and officers’ liability insurance (“D&O Insurance”) in reasonable amounts from established and reputable insurers.

 

 

 

(b) Notwithstanding the foregoing, the Company shall have no obligation to obtain or maintain D&O Insurance if the Company determines in good faith that such insurance is not reasonably available, the premium costs for such insurance are disproportionate to the amount of coverage provided, the coverage is reduced by exclusions so as to provide an insufficient benefit, or the Indemnitee is covered by similar insurance maintained by a subsidiary of the Company. If the Company decides in good faith that D&O insurance is not required, the Company is required to notify the Indemnity in writing and in advance of any decision to cancel D&O Insurance

 

4.  Mandatory Indemnification.  The Company shall indemnify the Indemnitee from:

 

(a)  Third Party Actions . If the Indemnitee is a person who was or is a party or is threatened to be made a party to any proceeding (other than an action by or in the right of the Company) by reason of the fact that he or she is or was an agent of the Company, or by reason of anything done or not done by him or her in any such capacity, against any and all expenses and liabilities of any type whatsoever (including, but not limited to, judgments, fines, ERISA excise taxes or penalties, and amounts paid in settlement) actually and reasonably incurred by him or her in connection with the investigation, defense, settlement or appeal of such proceeding if he or she acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the best interests of the Company, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his or her conduct was unlawful; and

 

(b)  Derivative Actions.  If the Indemnitee is a person who was or is a party or is threatened to be made a party to any proceeding by or in the right of the Company to procure a judgment in its favor by reason of the fact that he or she is or was an agent of the Company, or by reason of anything done or not done by him or her in any such capacity, against any amounts paid in settlement of any such proceeding and all expenses actually and reasonably incurred by him or her in connection with the investigation, defense, settlement, or appeal of such proceeding if he or she acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the best interests of the Company; except that no indemnification under this subsection shall be made in respect of any claim, issue or matter as to which such person shall have been finally adjudged to be liable to the Company after the time for an appeal has expired by a court of competent jurisdiction due to willful misconduct of a culpable nature in the performance of his or her duty to the Company unless and only to the extent that the court in which such proceeding was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such amounts which the court shall deem proper; and

 

(c)  Actions Where Indemnitee is Deceased.  If the Indemnitee is a person who was or is a party or is threatened to be made a party to any proceeding by reason of the fact that he or she is or was an agent of the Company, or by reason of anything done or not done by him or her in any such capacity, against any and all expenses and liabilities of any type whatsoever (including, but not limited to, judgments, fines, ERISA excise taxes or penalties, and amounts paid in settlement) actually and reasonably incurred by him or her in connection with the investigation, defense, settlement or appeal of such proceeding if he or she acted in good faith and in a manner he or she reasonably believed to be in or not opposed to the best interests of the Company, and prior to, during the pendency or after completion of such proceeding the Indemnitee is deceased, except that in a proceeding by or in the right of the Company no indemnification shall be due under the provisions of this subsection in respect of any claim, issue or matter as to which such person shall have been finally adjudged to be liable to the Company after the time for an appeal has expired, by a court of competent jurisdiction due to willful misconduct of a culpable nature in the performance of his or her duty to the Company, unless and only to the extent that the court in which such proceeding was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such amounts which the court shall deem proper; and

 

 

 

(d)  Exception for Amounts Covered by Insurance.  Notwithstanding the foregoing, the Company shall not be obligated to indemnify the Indemnitee for expenses or liabilities of any type whatsoever (including, but not limited to, judgments, fees, ERISA excise taxes or penalties, and amounts paid in settlement) which have been paid directly to Indemnitee under D&O Insurance.

 

5.  Partial Indemnification.  If the Indemnitee is entitled under any provision of this Agreement to indemnification by the Company for some or a portion of any expenses or liabilities of any type whatsoever (including, but not limited to, judgments, fines, ERISA excise taxes or penalties, and amounts paid in settlement) incurred by him or her in the investigation, defense, settlement or appeal of a proceeding but not entitled, however, to indemnification for all of the total amount thereof, the Company shall nevertheless indemnify the Indemnitee for such total amount except as to the portion thereof to which the Indemnitee is not entitled.

 

6.  Mandatory Advancement of Expenses.  Subject to Section 10 below, the Company shall advance all expenses incurred by the Indemnitee in connection with the investigation, defense, settlement or appeal of any proceeding to which the Indemnitee is a party or is threatened to be made a party by reason of the fact that the Indemnitee is or was an agent of the Company or by reason of anything done or not done by him or her in any such capacity. Indemnitee hereby undertakes to repay such amounts advanced only if, and to the extent that, it shall ultimately be determined that the Indemnitee is not entitled to be indemnified by the Company as authorized hereby. The advances to be made hereunder shall be paid by the Company to the Indemnitee within twenty (20) days following delivery of a written request therefor by the Indemnitee to the Company.

 

7.  Notice and Other Indemnification Procedures.

 

(a) Promptly after receipt by the Indemnitee of notice of the commencement of or the threat of commencement of any proceeding, the Indemnitee shall, if the Indemnitee believes that indemnification with respect thereto may be sought from the Company under this Agreement, notify the Company of the commencement or threat of commencement thereof.

 

(b) If, at the time of the receipt of a notice of the commencement of a proceeding pursuant to Section 7(a) hereof, the Company has D&O Insurance in effect, the Company shall give prompt notice of the commencement of such proceeding to the insurers in accordance with the procedures set forth in the respective policies. The Company shall thereafter take all necessary or desirable action to cause such insurers to pay, on behalf of the Indemnitee, all amounts payable as a result of such proceeding in accordance with the terms of such policies.

  

8.  Determination of Right to Indemnification.

 

(a) To the extent the Indemnitee has been successful on the merits or otherwise in defense of any proceeding referred to in Section 4(a), 4(b) or 4(c) of this Agreement or in the defense of any claim, issue or matter described therein, the Company shall indemnify the Indemnitee against expenses actually and reasonably incurred by him or her in connection therewith.

 

(b) In the event that Section 8(a) is inapplicable, the Company shall also indemnify the Indemnitee unless, and only to the extent that, the Company shall prove by clear and convincing evidence to a forum listed in Section 8(c) below that the Indemnitee has not met the applicable standard of conduct required to entitle the Indemnitee to such indemnification.

 

 

 

(c) The Indemnitee shall be entitled to select the forum in which the validity of the Company’s claim under Section 8(b) hereof that the Indemnitee is not entitled to indemnification will be heard from among the following:

 

(1) A quorum of the Board consisting of directors who are not parties to the proceeding for which indemnification is being sought;

 

(2) The stockholders of the Company;

 

(3) Legal counsel selected by the Indemnitee and reasonably approved by the Board, which counsel shall make such determination in a written opinion;

 

(4) A panel of three arbitrators, one of whom is selected by the Company, another of whom is selected by the Indemnitee and the last of whom is selected by the first two arbitrators so selected.

 

(d) As soon as practicable, and in no event later than 30 days after written notice of the Indemnitee’s choice of forum pursuant to Section 8(c) above, the Company shall, at its own expense, submit to the selected forum in such manner as the Indemnitee or the Indemnitee’s counsel may reasonably request, its claim that the Indemnitee is not entitled to indemnification; and the Company shall act in the utmost good faith to assure the Indemnitee a complete opportunity to defend against such claim.

 

(e) Notwithstanding a determination by any forum listed in Section 8(c) hereof that the Indemnitee is not entitled to indemnification with respect to a specific proceeding, the Indemnitee shall have the right to apply to a Texas District Court, the court in which that proceeding is or was pending or any other court of competent jurisdiction, for the purpose of enforcing the Indemnitee’s right to indemnification pursuant to the Agreement.

 

(f) The Company shall indemnify the Indemnitee against all expenses incurred by the Indemnitee in connection with any hearing or proceeding under this Section 8 involving the Indemnitee and against all expenses incurred by the Indemnitee in connection with any other proceeding between the Company and the Indemnitee involving the interpretation or enforcement of the rights of the Indemnitee under this Agreement unless a court of competent jurisdiction finds that each of the material claims and/or defenses of the Indemnitee in any such proceeding was frivolous or not made in good faith.

 

9.  Limitation of Actions and Release of Claims.  No proceeding shall be brought and no cause of action shall be asserted by or on behalf of the Company or any subsidiary against the Indemnitee, his or her spouse, heirs, estate, executors or administrators after the expiration of one year from the act or omission of the Indemnitee upon which such proceeding is based; however, in a case where the Indemnitee fraudulently conceals the facts underlying such cause of action, no proceeding shall be brought and no cause of action shall be asserted after the expiration of one year from the earlier of (i) the date the Company or any subsidiary of the Company discovers such facts, or (ii) the date the Company or any subsidiary of the Company could have discovered such facts by the exercise of reasonable diligence. Any claim or cause of action of the Company or any subsidiary of the Company, including claims predicated upon the negligent act or omission of the Indemnitee, shall be extinguished and deemed released unless asserted by filing of a legal action within such period. This Section 9 shall not apply to any cause of action which has accrued on the date hereof and of which the Indemnitee is aware on the date hereof, but as to which the Company has no actual knowledge apart from the Indemnitee’s knowledge.

 

10.  Exceptions.  Any other provision herein to the contrary notwithstanding, the Company shall not be obligated pursuant to the terms of this Agreement:

 

(a)  Claims Initiated by Indemnitee.  To indemnify or advance expenses to the Indemnitee with respect to proceedings or claims initiated or brought voluntarily by the Indemnitee and not by way of defense, except with respect to proceedings brought to establish or enforce a right to indemnification under this Agreement or any other statute or law or otherwise as required under Section 8, but such indemnification or advancement of expenses may be provided by the Company in specific cases if the Board of Directors finds it to be appropriate; or

 

 

 

(b)  Lack of Good Faith.  To indemnify the Indemnitee for any expenses incurred by the Indemnitee with respect to any proceeding instituted by the Indemnitee to enforce or interpret this Agreement, if a court of competent jurisdiction determines that each of the material assertions made by the Indemnitee in such proceeding was not made in good faith or was frivolous; or

 

(c)  Unauthorized Settlements.  To indemnify the Indemnitee under this Agreement for any amounts paid in settlement of a proceeding unless the Company consents to such settlement; or

 

(d)  Claims by the Company for Willful Misconduct.  To indemnify or advance expenses to the Indemnitee under this Agreement for any expenses incurred by the Indemnitee with respect to any proceeding or claim brought by the Company against the Indemnitee for willful misconduct, unless a court of competent jurisdiction determines that each of such claims was not made in good faith or was frivolous; or

 

(e)  Section 16(b) . To indemnify Indemnitee for expenses and the payment of profits arising from the purchase and sale by Indemnitee of securities in violation of Section 16(b) of the Securities Exchange Act of 1934, as amended, or any similar successor statute; or

 

(f)  Willful Misconduct.  To indemnify the Indemnitee on account of the Indemnitee’s conduct which is finally adjudged to have been knowingly fraudulent or deliberately dishonest, or to constitute willful misconduct; or

 

(g)  Unlawful Indemnification.  To indemnify the Indemnitee if a final decision by a court having jurisdiction in the matter shall determine that such indemnification is not lawful; or

 

(h)  Forfeiture of Certain Bonuses and Profits . To indemnify Indemnitee for the payment of amounts required to be reimbursed to the Company pursuant to Section 304 of the Sarbanes-Oxley Act of 2002, as amended, or any similar successor statute.

 

11.  Nonexclusivity.  The provisions for indemnification and advancement of expenses set forth in this Agreement shall not be deemed exclusive of any other rights which the Indemnitee may have under any provision of law, the Company’s Certificate of Incorporation or Bylaws, the vote of the Company’s stockholders or disinterested directors, other agreements, or otherwise, both as to actions in his or her official capacity and to actions in another capacity while occupying his or her position as an agent of the Company, and the Indemnitee’s rights hereunder shall continue after the Indemnitee has ceased acting as an agent of the Company and shall inure to the benefit of the heirs, executors and administrators of the Indemnitee.

 

12.  Interpretation of Agreement.  It is understood that the parties hereto intend this Agreement to be interpreted and enforced so as to provide indemnification to the Indemnitee to the fullest extent now or hereafter permitted by law.

 

13.  Severability.  If any provision or provisions of this Agreement shall be held to be invalid, illegal or unenforceable for any reason whatsoever, (i) the validity, legality and enforceability of the remaining provisions of the Agreement (including, without limitation, all portions of any paragraphs of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that are not themselves invalid, illegal or unenforceable) shall not in any way be affected or impaired thereby, and (ii) to the fullest extent possible, the provisions of this Agreement (including, without limitation, all portions of any paragraphs of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that are not themselves invalid, illegal or unenforceable) shall be construed so as to give effect to the intent manifested by the provision held invalid, illegal or unenforceable and to give effect to Section 12 hereof.

 

 

 

14.  Modification and Waiver.  No supplement, modification or amendment of this Agreement shall be binding unless executed in writing by both of the parties hereto. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provision hereof (whether or not similar) nor shall such waiver constitute a continuing waiver.

 

15.  Successors and Assigns.  The terms of this Agreement shall bind, and shall inure to the benefit of, the successors, heirs, executors, and administrators and assigns of the parties hereto.

 

16.  Notice.  All notices, requests, demands and other communications under this Agreement shall be in writing and shall be deemed duly given (i) if delivered by hand and receipted for by the party addressee or (ii) if mailed by certified or registered mail with postage prepaid, on the third business day after the mailing date. Addresses for notice to either party are as shown on the signature page of this Agreement, or as subsequently modified by written notice.

 

17.  Governing Law.  This Agreement shall be governed exclusively by and construed according to the laws of the State of Texas, as applied to contracts between Texas residents entered into and to be performed entirely within Texas.

 

18.  Consent to Jurisdiction.  The Company and the Indemnitee each hereby irrevocably consent to the jurisdiction of the courts of the State of Texas for all purposes in connection with any action or proceeding which arises out of or relates to this Agreement.

  

The parties hereto have entered into this Indemnity Agreement effective as of the date first above written.

  

  INDOOR HARVEST CORP
     
  By: /s/ Rick Gutshall
     
  Its: Interim CEO
   
  INDEMNITEE:
   
  Daniel Weadock