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

 

July 31, 2018

 

Date of Report (Date of earliest event reported)

 

THE GREATER CANNABIS COMPANY, INC.

 

(Exact Name of Registrant as Specified in Charter)

 

Florida   333-218854   30-0842570
(State or other jurisdiction   (Commission   (IRS Employer
of incorporation)   File Number)   Identification No.)

 

15 Walker Ave , Suite 101

Baltimore, MD
21208

 

(Address of Principal Executive Offices)

 

(443) 738-4051

 

(Registrant’s telephone number, including area code)

 

224 2 nd Ave N., Suite 9

St. Petersburg, FL

33701

 

(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 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))

 

 

 

     
 

 

SECTION 1 – REGISTRANT’S BUSINESS AND OPERATIONS

 

Item 1.01 Entry into a Material Definitive Agreement

 

Exchange Transaction

 

On July 31, 2018, The Greater Cannabis Company, Inc., a Florida corporation (the “Company”) entered into and consummated a voluntary share exchange transaction with Green C Corporation, a company incorporated under the laws of the Province of Ontario (“Green C”) and the shareholders of Green C (the “Selling Shareholders”) pursuant to a Share Exchange Agreement by and among the Company, Green C and the Selling Shareholders (the “Exchange Agreement”).

 

In accordance with the terms of the Exchange Agreement, the Company issued 9,411,998 shares of its preferred stock, par value $0.001 (the “Shares”) to the Selling Shareholders and certain individuals named below (collectively, the “Shareholder Group”) in exchange for 100% of the issued and outstanding capital stock of Green C (the “Exchange Transaction”). As a result of the Exchange Transaction, the Selling Shareholders acquired 29.67% of the Company’s issued and outstanding shares of preferred stock, Green C became the Company’s wholly-owned subsidiary and the Company acquired 100% of the business and operations of Green C. The preferred shares have been designated as the Series A Convertible Preferred Stock and have the following rights, features, privileges and limitations (in pertinent part):

 

1. Fractional Shares. Series A Convertible Preferred Stock may be issued in fractional shares.

 

2. Dividends. Series A Convertible Preferred Stock shall be treated pari passu with the Company’s shares of common stock (“Common Stock”) except that the dividend on each share of Series A Convertible Preferred Stock shall be equal to the amount of the dividend declared and paid on each share of Common Stock multiplied by the Conversion Rate.

 

3. Liquidation, Dissolution, or Winding Up.

 

(a) Payments to Holders of Series A Convertible Preferred Stock. Series A Convertible Preferred Stock shall be treated pari passu with Common Stock except that the payment on each share of Series A Convertible Preferred Stock shall be equal to the amount of the payment on each share of Common Stock multiplied by the Conversion Rate.

 

4. Voting. (a) The shares of Series A Convertible Preferred Stock shall vote on all matters as a class with the holders of Common Stock and each share of Series A Convertible Preferred Stock shall be entitled to the number of votes per share equal to the Conversion Rate.

 

5. Conversion Rate and Adjustments.

 

(a) Conversion Rate. The Conversion Rate shall be 50 shares of Common Stock (as adjusted pursuant to this Section 5) for each share of Series A Convertible Preferred Stock.

 

(b) Adjustment for Stock Splits and Combinations. If the Corporation shall at any time or from time to time after the issuance of the Series A Convertible Preferred Stock effect a subdivision of the outstanding Common Stock, the Conversion Rate then in effect immediately before that subdivision shall be proportionately increased. If the Corporation shall at any time or from time to time after the issuance of the Series A Convertible Preferred Stock combine the outstanding shares of Common Stock, the Conversion Rate then in effect immediately before the combination shall be proportionately decreased. Any adjustment under this paragraph shall become effective at the close of business on the date the subdivision or combination becomes effective.

 

     
 

 

(c) Adjustment for Merger or Reorganization, etc. If there shall occur any reorganization, recapitalization, reclassification, consolidation, or merger involving the Corporation in which the Common Stock (but not the Series A Convertible Preferred Stock) is converted into or exchanged for securities, cash, or other property, then, following any such reorganization, recapitalization, reclassification, consolidation, or merger, each share of Series A Convertible Preferred Stock shall thereafter be convertible in lieu of the Common Stock into which it was convertible prior to such event into the kind and amount of securities, cash or other property that a holder of the number of shares of Common Stock of the Corporation issuable upon conversion of one share of Series A Convertible Preferred Stock immediately prior to such reorganization, recapitalization, reclassification, consolidation, or merger would have been entitled to receive pursuant to such transaction.

 

6. Conversion.

 

(a) Shares of Series A Convertible Preferred Stock are convertible at the option of their holder in whole or in part at any time except that they shall not be convertible at any time that there are not a sufficient number of authorized shares of Common Stock not reserved for other purposes so that all outstanding shares of Series A Convertible Preferred Stock can be converted.

 

(b). If so required by the Corporation, certificates surrendered for conversion shall be endorsed or accompanied by written instrument or instruments of transfer, in form satisfactory to the Corporation, duly executed by the registered holder or by his, her, or its attorney duly authorized in writing. As soon as practicable after a conversion and the surrender of the certificate or certificates for Series A Convertible Preferred Stock, the Corporation shall cause to be issued and delivered to such holder, or on his, her, or its written order, a certificate or certificates for the number of full shares of Common Stock issuable on such conversion in accordance with the provisions hereof and cash as provided in Section 6(b) in respect of any fraction of a share of Common Stock otherwise issuable upon such conversion.

 

(c) All certificates or other form of ownership evidencing shares of Series A Convertible Preferred Stock (if any) that are required to be surrendered for conversion in accordance with the provisions hereof shall, from and after the date on which such preferred shares were converted, be deemed to have been retired and cancelled and the shares of Series A Convertible Preferred Stock represented thereby converted into Common Stock for all purposes, notwithstanding the failure of the holder or holders thereof to surrender such certificates or other form of ownership on or prior to such date. Such converted Series A Convertible Preferred Stock may not be reissued as shares of such Series, and the Corporation may thereafter take such appropriate action (without the need for stockholder action) as may be necessary to reduce the authorized number of shares of Series A Convertible Preferred Stock accordingly.

 

The Shareholder Group consists of:

 

  1. Aitan Zacharin
  2. Joe Kalfa
  3. Elisha Kalfa
  4. Fernando Bisker
  5. Sigalush LLC
  6. Mark Radom
  7. David Tavor
  8. Rakefet LLC

 

     
 

 

Green C is the owner of a license for an orally dissolved film containing CBD, as an active material, for medical treatment as further described in the exclusive license agreement dated June 21, 2018 with Pharmedica Ltd. Attached hereto as an exhibit (the “License Agreement”).

 

The Exchange Agreement includes customary representations, warranties and covenants of the Company, Green C, and the Selling Shareholders, made to each other as of specific dates.

 

The foregoing description of the Exchange Agreement is qualified in its entirety by reference to the full text of the Exchange Agreement, which is included as an exhibit to this Current Report on Form 8-K and is incorporated by reference herein.

 

SECTION 2 – FINANCIAL INFORMATION

 

Item 2.01 Completion of Acquisition or Disposition of Assets

 

The information provided in Item 1.01 of this Current Report on Form 8-K related to the Exchange Agreement is incorporated by reference into this Item 2.01.

 

As of the date of the Exchange Agreement, there were no material relationships between the Company, Green C or the Selling Shareholders or between the Company, Green C or the Selling Shareholder’s respective affiliates, directors, or officers or associates thereof, other than in respect of the Exchange Agreement and the Selling Shareholders’ ownership interest in Green C.

 

SECTION 5 – CORPORATE GOVERNANCE AND MANAGEMENT

 

Item 5.01. Changes in Control of Registrant.

 

As more fully described in Item 1.01 above, incorporated herein by reference, on July 31, 2018, the Company closed the Exchange Transaction. As a result of the closing of the Exchange Transaction, the Selling Shareholder Group acquired 100% of the issued and outstanding preferred stock of the Company, which represents and controls 94.1% of the Company’s voting power.

 

In connection with this change in control, and as explained more fully in Item 5.02 below, effective as of July 31, 2018, Wayne Anderson resigned as Director, President, Chief Executive Officer, Chief Financial Officer, Treasurer and Secretary of the Company.

 

In order to smoothen the transition from existing management to new management, the Company has entered into a consulting agreement with Wayne Anderson, a copy of which is attached hereto as an exhibit.

 

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

 

(b)       Resignation of Officer

 

As a condition to the closing of the Exchange Transaction, effective July 31, 2018, Wayne Anderson resigned as Director, President, Chief Executive Officer, Chief Financial Officer, Treasurer and Secretary of the Company.

 

     
 

 

(c)       Appointment of Officers

 

As a condition to the closing of the Exchange Transaction, effective July 31, 2018, the Board of Directors of the Company (the “Board”) appointed Aitan Zacharin as Director and Chief Executive Officer of the Company and Mark Radom as chief legal officer of the Company.

 

Mark Radom previously held the positions President, Chief Executive Officer, Chief Financial Officer, Treasurer and Secretary of Graphite Corp. Although there was no arrangement or understanding between Mark Radom and any other person(s) pursuant to which he was selected as chief legal officer of the Company, the Selling Shareholders decided on their own initiative to offer Mr. Radom the position of chief legal officer. Mark Radom has no family relationships with any director or executive officer of the Company, or persons nominated or chosen by the Company to become directors or executive officers. Furthermore, the Company is not aware of any transaction involving Mark Radom requiring disclosure under Item 404(a) of Regulation S-K, except for the Exchange Transaction.

 

The Board believes that Mr. Radom’s extensive experience in business development, management of complex projects and legal services in connection therewith will be invaluable in achieving the Company’s goals.

 

Professional History of Aitan Zacharin

 

Mr. Zacharin is an experienced executive with a broad knowledge in building and managing technology and consumer products businesses. In 2012, he co-founded Fuse Science, an innovative biotechnology company headquartered in Miami, Florida and Oxnard, California. Mr. Zacharin was responsible for the development and growth of the business from a seed stage R&D company to a publicly traded CPG and biotech business with multiple subsidiaries. During his tenure he was tasked with expanding the biotechnology IP portfolio, spearheading multiple in vitro studies, and growing the consumer products business. In scaling the company, Mr. Zacharin identified and hired executive talent to lead the commercialization strategy including the past President of SC Johnson Company and previous CEO of Champs and Footlocker Sports. He successfully led the company to raise over $10M in three over-subscribed rounds, as well as negotiated contracts with 26 world renowned athlete and celebrity brand ambassadors, which included top ranked pro golfer Tiger Woods. Under Mr. Zacharin’s leadership the company developed and commercialized multi-category consumer products through a retail footprint of 15,000 doors. Since his exit from Fuse Science, he has been advising and investing in mid to late stage technology startups, and assisting them with capitalization, business strategy and development, and accelerating growth. Mr. Zacharin holds dual degrees from the University of South Florida in Tampa Bay. He resides in Baltimore, Maryland, and maintains various board appointments both professionally and philanthropically.

 

Professional History of Mark Radom

 

From August 2015 to July 2018, Mr. Radom served as chief executive officer of Graphite Corp. From February 2010 through July 2015, Mr. Radom served as the chief carbon officer and general counsel of Blue Sphere Corporation. From 2009 through 2010, Mr. Radom was managing director of Carbon MPV Limited, a Cyprus company focused on developing renewable energy and carbon credit projects. From 2007 to 2009, Mr. Radom was general counsel and chief operating officer of Carbon Markets Global Limited, a London-based carbon credit and renewable energy project developer. Mr. Radom has extensive experience in business development in the renewable energy and carbon credit sectors. He has sourced over U.S. $100,000,000 in renewable energy, industrial gas and carbon credit projects and managed many complex aspects of their implementation. He was legal counsel for a number of carbon and ecological project developers and was responsible for structuring joint ventures and advising on developing projects through the CDM/JI registration cycle and emission reduction purchase agreements under the auspices of the Kyoto Protocol. Prior to this, he worked on Wall Street and in the City of London as a US securities and capital markets lawyer where he represented sovereigns, global investment banks and fortune 500 companies across a broad range of capital raising and corporate transactions. He is a graduate of Duke University and Brooklyn Law School. Mr. Radom is admitted to practice law in New York and New Jersey and speaks fluent Russian.

 

     
 

 

(d)       Appointment of Directors

 

As a condition to the closing of the Exchange Transaction, effective July 31, 2018, the Board appointed Aitan Zacharin as a director of the Company. Mr. Zacharin does not have any family relationships with any other executive officers or directors of the Company, or persons nominated or chosen by the Company to become directors or executive officers. There is no arrangement or understanding pursuant to which Mr. Zacharin was appointed as a member of the Board. Furthermore, the Company is not aware of any transaction requiring disclosure under Item 404(a) of Regulation S-K, except for the Exchange Transaction. It is contemplated that Mr. Zacharin may serve on certain committees of the Board, but no such committee appointments have been made at this time.

 

SECTION 9 – FINANCIAL STATEMENTS AND EXHIBITS

 

Item 9.01 Financial Statements and Exhibits

 

(a) Financial Statements of Business Acquired

 

The audited financial statements of Green C required pursuant to this Item 9.01(a) will be filed by amendment within 71 calendar days after the date that this Current Report on Form 8-K was required to be filed.

 

(b) Pro Forma Financial Information

 

The pro forma financial information of Green C required pursuant to this Item 9.01(b) will be filed by amendment within 71 calendar days after the date that this Current Report on Form 8-K was required to be filed.

 

(d) Exhibits

 

Exhibit 2.1   Share Exchange Agreement by and among the Company, Green C and the Selling Shareholders dated July 31, 2018
     
Exhibit 10.30   Aitan Zacharin Service Agreement dated July 31, 2018
     
Exhibit 10.31   Mark Radom Service Agreement dated July 31, 2018
     
Exhibit 10.32   Wayne Anderson Release and Debt Forgiveness Agreement dated July 31, 2018
     
Exhibit 10.33   Aitan Zacharin Indemnification Agreement dated July 31, 2018
     
Exhibit 10.34   Mark Radom Indemnification Agreement dated July 31, 2018
     
Exhibit 10.35   Wayne Anderson Consulting Agreement dated July 31, 2018
     
Exhibit 10.36   License Agreement with Pharmedica Ltd. dated June 21, 2018

 

     
 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

 

THE GREATER CANNABIS COMPANY, INC.

a Florida corporation

   

Dated: August 3, 2018

By:

/s/ Aitan Zacharin

    Chief Executive Officer
and Sole Director

 

     
 

 

SHARE EXCHANGE AGREEMENT

 

THIS SHARE EXCHANGE AGREEMENT (the “ Agreement ”) is made this 31st day of July 2018, by and among The Greater Cannabis Company, Inc., a Florida corporation (“ GCAN ”), Merger Sub, a special purpose Florida corporation established for the purpose of effecting a reverse triangular merger with GCAN, the Company and the Selling Shareholders (“ Merger Sub ”), Green C Corporation, a Canadian company incorporated under the laws of the Province of Ontario (the “ Company ”) and the shareholders of the Company as set forth on Exhibit A attached hereto (collectively, the “ Selling Shareholders ”), on the other hand.

 

BACKGROUND

 

A. The respective Boards of Directors of GCAN and the Company have determined that an acquisition of 100% of the Company’s outstanding shares by GCAN through a reverse triangular merger with the Company and the Selling Shareholders (the “ Exchange ”), upon the terms and subject to the conditions set forth in this Agreement, would be fair and in the best interests of their respective shareholders, and such Boards of Directors, along with the Selling Shareholders, have approved such Exchange, pursuant to which one hundred percent (100%) of the shares of capital stock of the Company issued and outstanding immediately prior to the Effective Time (as defined in Section 1.04) and all securities convertible or exchangeable into capital stock of the Company (collectively the “ Shares ”) will be exchanged (including by reservation for future issuances) for the right to receive 2,966,666 preferred shares of stock of GCAN, which represents twenty nine and 66/100 percent (29.66%) of the authorized and issued preferred shares of GCAN, which represent and control twenty nine and 66/100 percent (29.66%) of the voting power of GCAN (the “ Exchange Shares ”).

 

B. At the Closing, the Selling Shareholders will merge the Company into Merger Sub, which will then dissolve by operation of law, the Company will become a 100%-owned subsidiary of GCAN and the Selling Shareholders’ ownership interest in GCAN, as represented by the Exchange Shares, shall represent approximately 29.66% of the issued and outstanding preferred shares of GCAN, including, without limitation, in respect of any shares of GCAN preferred stock that have been reserved for future issuance or into which any options, warrants, securities, instruments or other rights of any nature are convertible.

 

C. GCAN, the Company and the Selling Shareholders desire to make certain representations, warranties, covenants and agreements in connection with the Exchange and also to prescribe various conditions to the Exchange.

 

D. For federal income tax purposes, the parties intend that the Exchange shall qualify as reorganization under the provisions of Section 368(a)(1)(B) of the Internal Revenue Code of 1986, as amended (the “ Code ”).

 

NOW, THEREFORE, in consideration of the representations, warranties, covenants and agreements contained in this Agreement, the parties agree as follows:

 

ARTICLE I

 

THE EXCHANGE

 

1.01 Exchange . Upon the terms and subject to the conditions set forth in this Agreement, and in accordance with the Florida Revised Statutes (“ Florida Statutes ”), at the Closing (as hereinafter defined), the parties shall do the following:

 

(a) The Selling Shareholders will sell, convey, assign, and transfer the Shares to GCAN by delivering to GCAN stock certificates issued in the name of GCAN evidencing the Shares (the “ Share Certificates ”). The Shares transferred to GCAN at the Closing shall constitute 100% of the issued and outstanding common stock of the Company.

 

(b) As consideration for its acquisition of the Shares, GCAN shall issue the Exchange Shares to the Selling Shareholders by delivering share certificates to the Selling Shareholders registered in the name of the Selling Shareholders, or their nominees, evidencing the Exchange Shares (the “ Exchange Shares Certificates ”) in such amounts attributable to the Selling Shareholders as set forth on Exhibit A hereto. The Exchange Shares shall equal no less than []% of the outstanding preferred shares of GCAN’s stock, including, without limitation, in respect of any shares of GCAN stock that have been reserved for future issuance or into which any options, warrants, securities, instruments or other rights of any nature are convertible.

 

   
 

 

(c) For federal income tax purposes, the Exchange is intended to constitute a “reorganization” within the meaning of Section 368 of the Code, and the parties shall report the transactions contemplated by this Agreement consistent with such intent and shall take no position in any tax filing or legal proceeding inconsistent therewith. The parties to this Agreement hereby adopt this Agreement as a “plan of reorganization” within the meaning of Sections 1.368-2(g) and 1.368-3(a) of the United States Treasury Regulations. None of GCAN, the Company or the Selling Shareholders has taken or failed to take, and after the Effective Time (as defined below), GCAN shall not take or fail to take, any action which reasonably could be expected to cause the Exchange to fail to qualify as a “reorganization” within the meaning of Section 368(a) of the Code.

 

1.02 Effect of the Exchange . The Exchange shall have the effects set forth in the applicable provisions of the Florida Statutes.

 

1.03 Closing . Subject to the satisfaction or waiver of the conditions set forth in Article IV, the closing of the Exchange (the “ Closing ”) will take place at 10:00 a.m. New York Time on the business day within three (3) business days of satisfaction of the conditions set forth in Article IV (or as soon as practicable thereafter following satisfaction or waiver of the conditions set forth in Article IV) (the “ Closing Date ”).

 

1.04 Effective Time of Exchange . As soon as practicable following the satisfaction or waiver of the conditions set forth in Article IV, the parties shall make all filings or recordings required under the Florida Statutes. The Exchange shall become effective at such time as is permissible in accordance with the Florida Statutes (the time the Exchange becomes effective being the “ Effective Time ”). GCAN and the Company shall use reasonable efforts to have the Closing Date and the Effective Time to be the same day.

 

1.05 Director/Officers . On or before the Closing Date, GCAN shall cause the appointment of the individuals set forth on Schedule 1.05 to be the officers and directors of GCAN and shall cause the concurrent resignation of the officers of GCAN as set forth on Schedule 1.05 . The Selling Shareholders shall have the right to nominate one director to the board of GCAN by sending written notice to GCAN. In such case, GCAN shall be required to appoint the Selling Shareholders’ nominee within 10 business days of receipt of written notice.

 

1.06 Exchange Reversal. (a) Notwithstanding anything else to the contrary herein, but subject to the following terms and conditions of this Section 1.06, each party to this agreement agrees that in the event that the Company fails to (i) file its quarterly and annual reports on forms 10-Q and 10-K (the “Reports”) in a timely manner for the 14-month period following the date hereof or (ii) the License Agreement (as defined below) is terminated during the 14-month period following the date hereof, the transactions contemplated by this Agreement may be reversed and will lose all force and effect. For the avoidance of doubt, it is agreed that so long as the Company files a Rule 12b-25 notice of extension and then files the relevant Report within the time period prescribed by Rule 12b-25 for such Report, that particular Report will be deemed to be filed in a timely manner.

 

(b) In the event of (i) or (ii) from the first sentence of this Section 1.06 occurring or being reasonably likely to occur, the Company will provide prompt written notice thereof to Wayne Anderson. In such case, Wayne Anderson shall, subject to sub-paragraph (c) of this Section 1.06 below, have the right to send a written notice of reversal of the transactions contemplated by this Agreement to the Company and/or Aitan Zacharin and Mark Radom (emails sent to the last address known to Wayne Anderson will be sufficient to constitute notice). In such case, the Company appoints Wayne Anderson, acting on his own, as its attorney-in-fact to enter into any agreements and to take any actions that may be helpful or necessary to unwind and reverse the transactions contemplated by this Agreement. In this connection and for the avoidance of doubt, it is agreed that Wayne Anderson has all corporate power and authority required to accomplish the foregoing.

 

(c) In the event that the Company is unable to file a Report or cure a material breach of the License Agreement due to lack of funds, Wayne Anderson and/or Sylios Corporation is hereby granted an option to advance the funds to make any required payments to file the relevant Report(s) or cure a breach of the License Agreement to the Company in exchange for the issuance and delivery of a convertible note for the amount of the funds so advanced plus $20,000 of original issue discount and warrants valid for 18 months to purchase shares of common stock of the Company at the closing price on the date of delivery of such warrants.

 

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(d) Notwithstanding anything else to the contrary in this Agreement, this Section 1.06 shall no longer have any force or effect on the date that is 14 months from the date hereof.

 

ARTICLE II

 

REPRESENTATIONS AND WARRANTIES

 

2.01 Representations and Warranties of the Company. Except as set forth in the disclosure schedule delivered by the Company to GCAN at the time of execution of this Agreement (the “ Company Disclosure Schedule ”), the Company represents and warrants to GCAN as follows:

 

(a) Organization, Standing and Power . The Company is duly organized, validly existing and in good standing under the laws of the Province of Ontario and has the requisite power and authority and all government licenses, authorizations, permits, consents and approvals required to own, lease and operate its properties and carry on its business as now being conducted. The Company is duly qualified or licensed to do business and is in good standing in each jurisdiction in which the nature of its business or the ownership or leasing of its properties makes such qualification or licensing necessary, other than in such jurisdictions where the failure to be so qualified or licensed (individually or in the aggregate) would not have a material adverse effect (as defined in Section 6.02).

 

(b) Subsidiaries . The Company does not own directly or indirectly, any equity or other ownership interest in any company, corporation, partnership, joint venture or otherwise.

 

(c) Capital Structure . The number of shares and type of all authorized, issued and outstanding capital stock of the Company, and all shares of capital stock reserved for issuance under the Company’s various option and incentive plans is specified on Schedule 2.01(c) . Except as set forth in Schedule 2.01(c) , no shares of capital stock or other equity securities of the Company are issued, reserved for issuance or outstanding. All outstanding shares of capital stock of the Company are duly authorized, validly issued, fully paid and nonassessable and not subject to preemptive rights. There are no outstanding bonds, debentures, notes or other indebtedness or other securities of the Company having the right to vote (or convertible into, or exchangeable for, securities having the right to vote) on any matters. Except as set forth in Schedule 2.01(c) , there are no outstanding securities, options, warrants, calls, rights, commitments, agreements, arrangements or undertakings of any kind to which the Company is a party or by which they are bound obligating the Company to issue, deliver or sell, or cause to be issued, delivered or sold, additional shares of capital stock or other equity or voting securities of the Company or obligating the Company to issue, grant, extend or enter into any such security, option, warrant, call, right, commitment, agreement, arrangement or undertaking. There are no outstanding contractual obligations, commitments, understandings or arrangements of the Company to repurchase, redeem or otherwise acquire or make any payment in respect of any shares of capital stock of the Company. There are no agreements or arrangements pursuant to which the Company is or could be required to register shares of Company common stock or other securities under the Securities Act of 1933, as amended and the rules and regulations promulgated thereunder (the “ Securities Act ”) or other agreements or arrangements with or among any security holders of the Company with respect to securities of the Company.

 

(d) Corporate Authority; Noncontravention . The Company has all requisite power and authority to enter into this Agreement and to consummate the transactions contemplated by this Agreement. The execution and delivery of this Agreement by the Company and the consummation by the Company of the transactions contemplated hereby have been (or at Closing will have been) duly authorized by all necessary action on the part of the Company. This Agreement has been duly executed and when delivered by the Company shall constitute a valid and binding obligation of the Company, enforceable against the Company and the Selling Shareholders, as applicable, in accordance with its terms, except as such enforcement may be limited by bankruptcy, insolvency or other similar laws affecting the enforcement of creditors’ rights generally or by general principles of equity. The execution and delivery of this Agreement do not, and the consummation of the transactions contemplated by this Agreement and compliance with the provisions hereof will not, conflict with, or result in any breach or violation of, or default (with or without notice or lapse of time, or both) under, or give rise to a right of termination, cancellation or acceleration of or “put” right with respect to any obligation or to a loss of a material benefit under, or result in the creation of any lien upon any of the properties or assets of the Company under, (i) the Company’s certificate of incorporation, memorandum of association, articles of association, bylaws or other organizational or charter documents of the Company, (ii) any loan or credit agreement, note, bond, mortgage, indenture, lease or other agreement, instrument, permit, concession, franchise or license applicable to the Company, its properties or assets, or (iii) subject to the governmental filings and other matters referred to in the following sentence, any judgment, order, decree, statute, law, ordinance, rule, regulation or arbitration award applicable to the Company, its properties or assets, other than, in the case of clauses (ii) and (iii), any such conflicts, breaches, violations, defaults, rights, losses or liens that individually or in the aggregate could not have a material adverse effect with respect to the Company or could not prevent, hinder or materially delay the ability of the Company to consummate the transactions contemplated by this Agreement.

 

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(e) Governmental Authorization . No consent, approval, order or authorization of, or registration, declaration or filing with, or notice to, any court, administrative agency or commission, or other federal, state or local government or other governmental authority, agency, domestic or foreign (a “ Governmental Entity ”), is required by or with respect to the Company in connection with the execution and delivery of this Agreement by the Company or the consummation by the Company of the transactions contemplated hereby, except, with respect to this Agreement, any filings under the Securities Act or the Exchange Act.

 

(f) (i) Since June 21, 2018, the date on which the license agreement with Pharmedica Limited was entered into (the “ License Agreement ”) by the Company (the “ License Agreement Date ”), there has been no material adverse change in the assets or liabilities, or in the business or condition, financial or otherwise, or in the results of operations or prospects, of the Company, whether as a result of any legislative or regulatory change, revocation of any license or rights to do business, fire, explosion, accident, casualty, labor trouble, flood, drought, riot, storm, condemnation, act of God, public force or otherwise and no material adverse change in the assets or liabilities, or in the business or condition, financial or otherwise, or in the results of operation or prospects, of the Company except in the ordinary course of business.

 

(ii) Since the License Agreement Date, the Company has not suffered any damage, destruction or loss of physical property (whether or not covered by insurance) affecting its condition (financial or otherwise) or operations (present or prospective), nor has the Company, except as disclosed in writing to GCAN, issued, sold or otherwise disposed of, or agreed to issue, sell or otherwise dispose of, any capital stock or any other security of the Company and has not granted or agreed to grant any option, warrant or other right to subscribe for or to purchase any capital stock of any other security of the Company or has incurred or agreed to incur any indebtedness for borrowed money.

 

(g) Absence of Certain Changes or Events . Since the License Agreement Date, the Company has conducted its business only in the ordinary course consistent with past practice, and there is not and has not been any:

 

(i) material adverse change with respect to the Company;

 

(ii) condition, event or occurrence which could reasonably be expected to prevent, hinder or materially delay the ability of the Company to consummate the transactions contemplated by this Agreement;

 

(iii) incurrence, assumption or guarantee by the Company of any indebtedness for borrowed money other than in the ordinary course and in amounts and on terms consistent with past practices and as disclosed to GCAN in writing;

 

(iv) creation or other incurrence by the Company of any lien on any asset other than in the ordinary course consistent with past practices;

 

(v) transaction or commitment made, or any contract or agreement entered into, by the Company relating to its assets or business (including the acquisition or disposition of any assets) or any relinquishment by the Company of any contract or other right, in either case, material to the Company, other than transactions and commitments in the ordinary course consistent with past practices and those contemplated by this Agreement;

 

(vi) labor dispute, other than routine, individual grievances, or, to the knowledge of the Company, any activity or proceeding by a labor union or representative thereof to organize any employees of the Company or any lockouts, strikes, slowdowns, work stoppages or threats by or with respect to such employees;

 

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(vii) payment, prepayment or discharge of liability other than in the ordinary course of business or any failure to pay any liability when due;

 

(viii) write-offs or write-downs of any assets of the Company;

 

(ix) creation, termination or amendment of, or waiver of any right under, any material contract of the Company;

 

(x) damage, destruction or loss having, or reasonably expected to have, a material adverse effect on the Company;

 

(xi) other condition, event or occurrence which individually or in the aggregate could reasonably be expected to have a material adverse effect or give rise to a material adverse change with respect to the Company; or

 

(xii) agreement or commitment to do any of the foregoing.

 

(h) Certain Fees . No brokerage or finder’s fees or commissions are or will be payable by the Company to any broker, financial advisor or consultant, finder, placement agent, investment banker, bank or other person with respect to the transactions contemplated by this Agreement.

 

(i) Litigation; Labor Matters; Compliance with Laws .

 

(i) There is no suit, action or proceeding or investigation pending or, to the knowledge of the Company, threatened against or affecting the Company or any basis for any such suit, action, proceeding or investigation that, individually or in the aggregate, could reasonably be expected to have a material adverse effect with respect to the Company or prevent, hinder or materially delay the ability of the Company to consummate the transactions contemplated by this Agreement, nor is there any judgment, decree, injunction, rule or order of any Governmental Entity or arbitrator outstanding against the Company having, or which, insofar as reasonably could be foreseen by the Company, in the future could have, any such effect.

 

(ii) The Company is not a party to, or bound by, any collective bargaining agreement, contract or other agreement or understanding with a labor union or labor organization, nor is it the subject of any proceeding asserting that it has committed an unfair labor practice or seeking to compel it to bargain with any labor organization as to wages or conditions of employment nor is there any strike, work stoppage or other labor dispute involving it pending or, to its knowledge, threatened, any of which could have a material adverse effect with respect to Company.

 

(iii) The conduct of the business of the Company complies with all statutes, laws, regulations, ordinances, rules, judgments, orders, decrees or arbitration awards applicable thereto.

 

(j) Benefit Plans . The Company is not a party to any Benefit Plan under which the Company currently has an obligation to provide benefits to any current or former employee, officer or director of the Company. As used herein, “ Benefit Plan ” shall mean any employee benefit plan, program, or arrangement of any kind, including any defined benefit or defined contribution plan, stock ownership plan, executive compensation program or arrangement, bonus plan, incentive compensation plan or arrangement, profit sharing plan or arrangement, deferred compensation plan, agreement or arrangement, supplemental retirement plan or arrangement, vacation pay, sickness, disability, or death benefit plan (whether provided through insurance, on a funded or unfunded basis, or otherwise), medical or life insurance plan providing benefits to employees, retirees, or former employees or any of their dependents, survivors, or beneficiaries, severance pay, termination, salary continuation, or employee assistance plan.

 

(k) Certain Employee Payments . The Company is not a party to any employment agreement which could result in the payment to any current, former or future director or employee of the Company of any money or other property or rights or accelerate or provide any other rights or benefits to any such employee or director as a result of the transactions contemplated by this Agreement, whether or not (i) such payment, acceleration or provision would constitute a “parachute payment” (within the meaning of Section 280G of the Code), or (ii) some other subsequent action or event would be required to cause such payment, acceleration or provision to be triggered.

 

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(l) Properties & Tangible Assets .

 

(i) The Company has valid land use rights for all real property that is material to its business and good, clear and marketable title to all the tangible properties and tangible assets reflected in the latest balance sheet as being owned by the Company or acquired after the date thereof which are, individually or in the aggregate, material to the Company’s business (except properties sold or otherwise disposed of since the date thereof in the ordinary course of business), free and clear of all material liens, encumbrances, claims, security interest, options and restrictions of any nature whatsoever. Any real property and facilities held under lease by the Company is held by it under valid, subsisting and enforceable leases of which the Company is in compliance, except as could not, individually or in the aggregate, have or reasonably be expected to result in a material adverse effect.

 

(ii) The Company has good and marketable title to, or in the case of leased property, a valid leasehold interest in, the office space, computers, equipment and other material tangible assets which are material to its business. Each such tangible asset is in all material respects in good operating condition and repair (subject to normal wear and tear), is suitable for the purposes for which it presently is used, and, except as to leased assets, free and clear of any and all security interests. The Company does not have any knowledge of any dispute or claim made by any other person concerning such right, title and interest in such tangible assets.

 

(m) Intellectual Property .

 

(i) As used in this Agreement, “ Intellectual Property ” means all right, title and interest in or relating to all intellectual property, whether protected, created or arising under the laws of the United States or any other jurisdiction or under any international convention, including, but not limited to the following: (a) service marks, trademarks, trade names, trade dress, logos and corporate names (and any derivations, modifications or adaptations thereof), Internet domain names and Internet websites (and content thereof), together with the goodwill associated with any of the foregoing, and all applications, registrations, renewals and extensions thereof (collectively, “ Marks ”); (b) patents and patent applications, including all continuations, divisionals, continuations-in-part and provisionals and patents issuing thereon, and all reissues, reexaminations, substitutions, renewals and extensions thereof (collectively, “ Patents ”); (c) copyrights, works of authorship and moral rights, and all registrations, applications, renewals, extensions and reversions thereof (collectively, “ Copyrights ”); (d) confidential and proprietary information, trade secrets and non-public discoveries, concepts, ideas, research and development, technology, know-how, formulae, inventions (whether or not patentable and whether or not reduced to practice), compositions, processes, techniques, technical data and information, procedures, designs, drawings, specifications, databases, customer lists, supplier lists, pricing and cost information, and business and marketing plans and proposals, in each case excluding any rights in respect of any of the foregoing that comprise or are protected by Patents (collectively, “ Trade Secrets ”); and (e) Technology. For purposes of this Agreement, “ Technology ” means all Software, information, designs, formulae, algorithms, procedures, methods, techniques, ideas, know-how, research and development, technical data, programs, subroutines, tools, materials, specifications, processes, inventions (whether or not patentable and whether or not reduced to practice), apparatus, creations, improvements and other similar materials, and all recordings, graphs, drawings, reports, analyses, and other writings, and other embodiments of any of the foregoing, in any form or media whether or not specifically listed herein. Further, for purposes of this Agreement, “ Software ” means any and all computer programs, whether in source code or object code; databases and compilations, whether machine readable or otherwise; descriptions, flow-charts and other work product used to design, plan, organize and develop any of the foregoing; and all documentation, including user manuals and other training documentation, related to any of the foregoing.

 

(ii) Schedule 2.01(m) sets forth a list and description of the Intellectual Property required for the Company to operate, or used or held for use by the Company, in the operation of its business, including, but not limited to (a) all issued Patents and pending Patent applications, registered Marks, pending applications for registration of Marks, unregistered Marks, registered Copyrights of the Company and the record owner, registration or application date, serial or registration number, and jurisdiction of such registration or application of each such item of Intellectual Property, (b) all Software developed by or for the Company and (c) any Software not exclusively owned by the Company and incorporated, embedded or bundled with any Software listed in clause (b) above (except for commercially available software and so-called “shrink wrap” software licensed to the Company on reasonable terms through commercial distributors or in consumer retail stores for a license fee of no more than $10,000).

 

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(iii) To the best of the Company’s knowledge, the Company has a valid and enforceable right to use all Intellectual Property listed for the Company in Schedule 2.01(m) (and any other Intellectual Property required to be listed in Schedule 2.01(m) ) as the same are used, sold, licensed and otherwise commercially exploited by the Company and no such Intellectual Property has been abandoned. The Intellectual Property owned by the Company and the Intellectual Property licensed to it pursuant to valid and enforceable written license agreements include all of the Intellectual Property necessary and sufficient to enable the Company to conduct its business in the manner in which such business is currently being conducted. The Intellectual Property owned by the Company and its rights in and to such Intellectual Property are valid and enforceable.

 

(iv) The Company has not received, and is not aware of, any written or oral notice of any reasonable basis for an allegation against the Company of any infringement, misappropriation, or violation by the Company of any rights of any third party with respect to any Intellectual Property, and the Company is not aware of any reasonable basis for any claim challenging the ownership, use, validity or enforceability of any Intellectual Property owned, used or held for use by the Company. The Company does not have any knowledge that any third party is infringing, misappropriating, or otherwise violating (or has infringed, misappropriated or violated) any such Intellectual Property.

 

(v) The consummation of the transactions contemplated by this Agreement will not adversely affect the right of the Company to own or use any Intellectual Property owned, used or held for use by it.

 

(n) [reserved]

 

(o) Board Recommendation . The Board of Directors of the Company has unanimously determined that the terms of the Exchange are fair to and in the best interests of the Selling Shareholders of the Company and recommends that the Selling Shareholders approve the Exchange.

 

(p) Ownership of Stock . The Selling Shareholders own all of the issued and outstanding shares of capital stock of the Company, free and clear of all liens, claims, rights, charges, encumbrances, and security interests of whatsoever nature or type.

 

(q) Material Agreements

 

(i) Schedule 2.01(q) lists the following contracts and other agreements (“ Material Agreements ”) to which either the Company or the Selling Shareholders are a party: (a) any agreement (or group of related agreements) for the lease of real or personal property, including capital leases, to or from any person providing for annual lease payments in excess of $10,000 (b) any licensing agreement, or any agreement forming a partnership, strategic alliances, profit sharing or joint venture; (c) any agreement (or group of related agreements) under which it has created, incurred, assumed, or guaranteed any indebtedness for borrowed money in excess of $10,000, or under which a security interest has been imposed on any of its assets, tangible or intangible; (d) any profit sharing, stock option, stock purchase, stock appreciation, deferred compensation, severance, or other material plan or arrangement for the benefit of its current or former officers and managers or any of the Company’s employees; (e) any employment or independent contractor agreement providing annual compensation in excess of $10,000 or providing post-termination or severance payments or benefits or that cannot be cancelled without more than 30 days’ notice; (f) any agreement with any current or former officer, director, shareholder or affiliate of the Company; (g) any agreements relating to the acquisition (by merger, purchase of stock or assets or otherwise) by the Company of any operating business or material assets or the capital stock of any other person; (h) any agreements for the sale of any of the assets of the Company, other than in the ordinary course of business; (i) any outstanding agreements of guaranty, surety or indemnification, direct or indirect, by the Company; (j) any royalty agreements, licenses or other agreements relating to Intellectual Property (excluding licenses pertaining to “off-the-shelf” commercially available software used pursuant to shrink-wrap or click-through license agreements on reasonable terms for a license fee of no more than $10,000); and (k) any other agreement under which the consequences of a default or termination could reasonably be expected to have a material adverse effect on the Company.

 

(ii) The Company has made available to GCAN either an original or a correct and complete copy of each written Material Agreement. Except as set forth on Schedule 2.01(q) , with respect to each Material Agreement to which the Company or the Selling Shareholders are a party thereto: (A) the agreement is the legal, valid, binding, enforceable obligation of the Company or any of the Selling Shareholders and is in full force and effect in all material respects, subject to bankruptcy and equitable remedies exceptions; (B)(1) neither the Company nor the Selling Shareholders party thereto is in material breach or default thereof, (2) no event has occurred which, with notice or lapse of time, would constitute a material breach or default of, or permit termination, modification, or acceleration under, the Material Agreement; or (3) the Company has not received any notice or has any knowledge that any other party is, in default in any respect under any Material Agreement; and (C) neither the Company nor the Selling Shareholders have repudiated any material provision of the agreement.

 

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(r) Material Agreement Defaults . The Company is not, or has not, received any notice or has any knowledge that any other party is, in default in any respect under any Material Agreements; and there has not occurred any event that with the lapse of time or the giving of notice or both would constitute such a material default. For purposes of this section, a Material Agreement includes agreements which, if breached by the Company or the Selling Shareholders in such a manner would (i) permit any other party to cancel or terminate the same (with or without notice of passage of time), (ii) provide a basis for any other party to claim money damages (either individually or in the aggregate with all other such claims under that contract) from the Company or the Selling Shareholders, or (iii) give rise to a right of acceleration of any material obligation or loss of any material benefit under any such contract, agreement or commitment.

 

(s) Tax Returns and Tax Payments .

 

(i) The Company has filed with the appropriate taxing authorities all Tax Returns required to be filed by it (taking into account all applicable extensions). All such Tax Returns are true, correct and complete in all respects. All Taxes due and owing by the Company have been paid (whether or not shown on any Tax Return and whether or not any Tax Return was required). The unpaid Taxes of the Company did not, as of the date hereof, exceed the reserve for Tax liability (excluding any reserve for deferred Taxes established to reflect timing differences between book and Tax income) set forth on the face of the Company Financial Statements (rather than in any notes thereto). Since the Balance Sheet Date, the Company has not incurred any liability for Taxes outside the ordinary course of business consistent with past custom and practice. As of the Closing Date, the unpaid Taxes of the Company will not exceed the reserve for Tax liability (excluding any reserve for deferred Taxes established to reflect timing differences between book and Tax income) set forth on the books and records of the Company.

 

(ii) No material claim for unpaid Taxes has been made or become a lien against the property of the Company or is being asserted against the Company, and no extension of the statute of limitations on the assessment of any Taxes has been granted to the Company and is currently in effect.

 

(iii) As used herein, “ Taxes ” shall mean all taxes of any kind, including, without limitation, those on or measured by or referred to as income, gross receipts, sales, use, ad valorem, franchise, profits, license, withholding, payroll, employment, excise, severance, stamp, occupation, premium value added, property or windfall profits taxes, customs, duties or similar fees, assessments or charges of any kind whatsoever, together with any interest and any penalties, additions to tax or additional amounts imposed by any governmental authority, domestic or foreign. As used herein, “ Tax Return ” shall mean any return, report or statement required to be filed with any governmental authority with respect to Taxes.

 

(t) Environmental Matters . The Company is in compliance with all Environmental Laws in all material respects. The Company holds all permits and authorizations required under applicable Environmental Laws, unless the failure to hold such permits and authorizations would not have a material adverse effect on the Company, and is compliance with all terms, conditions and provisions of all such permits and authorizations in all material respects. The Company has no liability, absolute or contingent, under any Environmental Law that if enforced or collected would have a material adverse effect on the Company. “ Environmental Laws ” means all applicable foreign, federal, state and local statutes, rules, regulations, ordinances, orders, decrees and common law relating in any manner to contamination, pollution or protection of human health or the environment, and similar state laws. “ Hazardous Material ” means any toxic, radioactive, corrosive or otherwise hazardous substance, including petroleum, its derivatives, by-products and other hydrocarbons, or any substance having any constituent elements displaying any of the foregoing characteristics, which in any event is regulated under any Environmental Law.

 

(u) Accounts Receivable . All of the accounts receivable of the Company that are reflected in the Company Financial Statements or the accounting records of the Company as of the Closing Date (collectively, the “ Company Accounts Receivable ”) represent or will represent valid obligations arising from sales actually made or services actually performed in the ordinary course of business and are not subject to any defenses, counterclaims, or rights of set off other than those arising in the ordinary course of business and for which adequate reserves have been established. The Company Accounts Receivable are fully collectible to the extent not reserved for on the balance sheet on which they are shown.

 

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(v) Full Disclosure . All of the representations and warranties made by the Company in this Agreement, and all statements set forth in the certificates delivered by the Company at the Closing pursuant to this Agreement, are true, correct and complete in all material respects and do not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make such representations, warranties or statements, in light of the circumstances under which they were made, misleading. The copies of all documents furnished by the Company pursuant to the terms of this Agreement are complete and accurate copies of the original documents. The schedules, certificates, and any and all other statements and information, whether furnished in written or electronic form, to GCAN or its representatives by or on behalf of any of the Company or its affiliates in connection with the negotiation of this Agreement and the transactions contemplated hereby do not contain any material misstatement of fact or omit to state a material fact or any fact necessary to make the statements contained therein not misleading.

 

2.02 Representations and Warranties of GCAN . GCAN represents and warrants to the Company and the Selling Shareholders as follows:

 

(a) Organization, Standing and Corporate Power . GCAN is duly organized under the laws of the State of Florida and has the requisite corporate power and authority and all government licenses, authorizations, permits, consents and approvals required to own, lease and operate its properties and carry on its business as now being conducted. GCAN is duly qualified or licensed to do business and is in good standing in each jurisdiction in which the nature of its business or the ownership or leasing of its properties makes such qualification or licensing necessary, other than in such jurisdictions where the failure to be so qualified or licensed (individually or in the aggregate) would not have a material adverse effect with respect to GCAN Shares of common stock of GCAN, par value $0.001 (“ GCAN Common Stock ”), are quoted on the OTCQB, operated by OTC Market Group, Inc. under the symbol “GCAN.”

 

(b) Subsidiaries . GCAN does not own directly or indirectly, any equity or other ownership interest in any company, corporation, partnership, joint venture or otherwise.

 

(c) Capital Structure of GCAN . As of the date of this Agreement, the authorized capital stock of GCAN consists of 500,000,000 shares of GCAN Common Stock, $0.001 par value, of which 29,580,969 shares of GCAN Common Stock are issued and outstanding, and 10,000,000 shares of preferred stock, $0.001 par value (“GCAN Preferred Stock”), of which zero shares are issued or outstanding, and no shares of GCAN Common Stock or GCAN Preferred Stock are issuable upon the exercise of warrants, convertible notes, options or otherwise except as set forth in the GCAN SEC Documents (as defined herein). Except as set forth above, no shares of capital stock or other equity securities of GCAN are issued, reserved for issuance or outstanding. All shares which may be issued pursuant to this Agreement will be, when issued, duly authorized, validly issued, fully paid and nonassessable, free and clear of all liens, claims, rights, charges, encumbrances, and security interests of whatsoever nature or type, not subject to preemptive rights, and issued in compliance with all applicable state and federal laws concerning the issuance of securities.

 

(d) Corporate Authority; Noncontravention . GCAN has all requisite corporate and other power and authority to enter into this Agreement and to consummate the transactions contemplated by this Agreement. The execution and delivery of this Agreement by GCAN and the consummation by GCAN of the transactions contemplated hereby have been (or at Closing will have been) duly authorized by all necessary corporate action on the part of GCAN This Agreement has been duly executed and when delivered by GCAN shall constitute a valid and binding obligation of GCAN, enforceable against GCAN in accordance with its terms, except as such enforcement may be limited by bankruptcy, insolvency or other similar laws affecting the enforcement of creditors’ rights generally or by general principles of equity. The execution and delivery of this Agreement do not, and the consummation of the transactions contemplated by this Agreement and compliance with the provisions hereof will not, conflict with, or result in any breach or violation of, or default (with or without notice or lapse of time, or both) under, or give rise to a right of termination, cancellation or acceleration of or “put” right with respect to any obligation or to loss of a material benefit under, or result in the creation of any lien upon any of the properties or assets of GCAN under, (i) its articles of incorporation, bylaws, or other charter documents of GCAN (ii) any loan or credit agreement, note, bond, mortgage, indenture, lease or other agreement, instrument, permit, concession, franchise or license applicable to GCAN, its properties or assets, or (iii) subject to the governmental filings and other matters referred to in the following sentence, any judgment, order, decree, statute, law, ordinance, rule, regulation or arbitration award applicable to GCAN, its properties or assets, other than, in the case of clauses (ii) and (iii), any such conflicts, breaches, violations, defaults, rights, losses or liens that individually or in the aggregate could not have a material adverse effect with respect to GCAN or could not prevent, hinder or materially delay the ability of GCAN to consummate the transactions contemplated by this Agreement.

 

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(e) Government Authorization . No consent, approval, order or authorization of, or registration, declaration or filing with, or notice to, any Governmental Entity, is required by or with respect to GCAN in connection with the execution and delivery of this Agreement by GCAN, or the consummation by GCAN of the transactions contemplated hereby, except, with respect to this Agreement, any filings under the Florida Statutes, the Securities Act or the Exchange Act.

 

(f) Financial Statements . The financial statements of GCAN included in the reports, schedules, forms, statements and other documents filed by GCAN with the Securities and Exchange Commission (“ SEC ”) (collectively, and in each case including all exhibits and schedules thereto and documents incorporated by reference therein, the “ GCAN SEC Documents ”), comply as to form in all material respects with applicable accounting requirements and the published rules and regulations of the SEC with respect thereto, have been prepared in accordance with U.S. generally accepted accounting principles (except, in the case of unaudited quarterly statements, as permitted by Form 10-Q of the SEC) applied on a consistent basis during the periods involved (except as may be indicated in the notes thereto) and fairly present the financial position of GCAN as of the dates thereof and the results of operations and changes in cash flows for the periods then ended (subject, in the case of unaudited quarterly statements, to normal year-end audit adjustments as determined by GCAN’s independent accountants). GCAN has not incurred any liabilities or obligations of any nature (whether accrued, absolute, contingent or otherwise) except those reasonable expenses accrued in the normal course of business operations. As of their respective dates or, if amended, as of the date of the last such amendment, each of the GCAN SEC Documents, including any financial statements or schedules included therein (i) did not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements made therein, in light of the circumstances under which they were made, not misleading, (ii) were complete and accurate in all material respects, and (iii) complied in all material respects with the applicable requirements of the Exchange Act and the Securities Act, as the case may be, and the applicable rules and regulations of the SEC thereunder.

 

(g) Absence of Certain Changes or Events . Except as disclosed in the GCAN SEC Documents, since the date of the most recent financial statements included in the GCAN SEC Documents, GCAN has conducted its business only in the ordinary course consistent with past practice in light of its current business circumstances, and there is not and has not been any:

 

(i) material adverse change with respect to GCAN;

 

(ii) condition, event or occurrence which could reasonably be expected to prevent, hinder or materially delay the ability of GCAN to consummate the transactions contemplated by this Agreement;

 

(iii) incurrence, assumption or guarantee by GCAN of any indebtedness for borrowed money other than in the ordinary course and in amounts and on terms consistent with past practices or as disclosed to the Company in writing;

 

(iv) creation or other incurrence by GCAN of any lien on any asset other than in the ordinary course consistent with past practices;

 

(v) transaction or commitment made, or any contract or agreement entered into, by GCAN relating to its assets or business (including the acquisition or disposition of any assets) or any relinquishment by GCAN of any contract or other right, in either case, material to GCAN, other than transactions and commitments in the ordinary course consistent with past practices and those contemplated by this Agreement;

 

(vi) labor dispute, other than routine, individual grievances, or, to the knowledge of GCAN, any activity or proceeding by a labor union or representative thereof to organize any employees of GCAN or any lockouts, strikes, slowdowns, work stoppages or threats by or with respect to such employees;

 

(vii) payment, prepayment or discharge of liability other than in the ordinary course of business or any failure to pay any liability when due;

 

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(viii) write-offs or write-downs of any assets of GCAN;

 

(ix) creation, termination or amendment of, or waiver of any right under, any material contract of GCAN;

 

(x) damage, destruction or loss having, or reasonably expected to have, a material adverse effect on GCAN;

 

(xi) other condition, event or occurrence which individually or in the aggregate could reasonably be expected to have a material adverse effect or give rise to a material adverse change with respect to GCAN; or

 

(xii) agreement or commitment to do any of the foregoing.

 

(h) Certain Fees . No brokerage or finder’s fees or commissions are or will be payable by GCAN to any broker, financial advisor or consultant, finder, placement agent, investment banker, bank or other person with respect to the transactions contemplated by this Agreement.

 

(i) Litigation; Labor Matters; Compliance with Laws .

 

(i) There is no suit, action or proceeding or investigation pending or, to the knowledge of GCAN, threatened against or affecting GCAN or any basis for any such suit, action, proceeding or investigation that, individually or in the aggregate, could reasonably be expected to have a material adverse effect with respect to GCAN or prevent, hinder or materially delay the ability of GCAN to consummate the transactions contemplated by this Agreement, nor is there any judgment, decree, injunction, rule or order of any Governmental Entity or arbitrator outstanding against GCAN having, or which, insofar as reasonably could be foreseen by GCAN, in the future could have, any such effect.

 

(ii) GCAN is not a party to, or bound by, any collective bargaining agreement, contract or other agreement or understanding with a labor union or labor organization, nor is it the subject of any proceeding asserting that it has committed an unfair labor practice or seeking to compel it to bargain with any labor organization as to wages or conditions of employment nor is there any strike, work stoppage or other labor dispute involving it pending or, to its knowledge, threatened, any of which could have a material adverse effect with respect to GCAN

 

(iii) The conduct of the business of GCAN complies with all statutes, laws, regulations, ordinances, rules, judgments, orders, decrees or arbitration awards applicable thereto.

 

(j) Benefit Plans . GCAN is not a party to any Benefit Plan under which GCAN currently has an obligation to provide benefits to any current or former employee, officer or director of GCAN

 

(k) Certain Employee Payments . GCAN is not a party to any employment agreement or other agreement of any nature which could result in the payment to any current, former or future director or employee of GCAN of any money or other property or rights or accelerate or provide any other rights or benefits to any such employee or director, whether or not (i) such payment, acceleration or provision would constitute a “parachute payment” (within the meaning of Section 280G of the Code) or (ii) some other subsequent action or event would be required to cause such payment, acceleration or provision to be triggered.

 

(l) Material Agreement Defaults . GCAN is not, or has not, received any notice or has any knowledge that any other party is, in default in any respect under any GCAN Material Agreement; and there has not occurred any event that with the lapse of time or the giving of notice or both would constitute such a material default. For purposes of this Agreement, a “ GCAN Material Agreement ” means any contract, agreement or commitment that is effective as of the Closing Date to which GCAN is a party (i) with expected receipts or expenditures in excess of $100, (ii) requiring GCAN to indemnify any person, (iii) granting exclusive rights to any party, (iv) evidencing indebtedness for borrowed or loaned money in excess of $100 or more, including guarantees of such indebtedness, or (v) which, if breached by GCAN in such a manner would (A) permit any other party to cancel or terminate the same (with or without notice of passage of time) or (B) provide a basis for any other party to claim money damages (either individually or in the aggregate with all other such claims under that contract) from GCAN or (C) give rise to a right of acceleration of any material obligation or loss of any material benefit under any such contract, agreement or commitment.

 

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(m) Properties . GCAN has valid land use rights for all real property that is material to its business and good, clear and marketable title to all the tangible properties and tangible assets reflected in the latest balance sheet as being owned by GCAN or acquired after the date thereof which are, individually or in the aggregate, material to GCAN’s business (except properties sold or otherwise disposed of since the date thereof in the ordinary course of business), free and clear of all material liens, encumbrances, claims, security interest, options and restrictions of any nature whatsoever. Any real property and facilities held under lease by GCAN are held by them under valid, subsisting and enforceable leases of which GCAN is in compliance, except as could not, individually or in the aggregate, have or reasonably be expected to result in a material adverse effect.

 

(n) Intellectual Property . GCAN owns or has valid rights to use the Trademarks, trade names, domain names, copyrights, patents, logos, licenses and computer software programs (including, without limitation, the source codes thereto) that are necessary for the conduct of its business as now being conducted. All of GCAN’s licenses to use Software programs are current and have been paid for the appropriate number of users. To the knowledge of GCAN, none of GCAN’s Intellectual Property or GCAN License Agreements infringe upon the rights of any third party that may give rise to a cause of action or claim against GCAN or its successors. The term “ GCAN License Agreements ” means any license agreements granting any right to use or practice any rights under any Intellectual Property (except for such agreements for off-the-shelf products that are generally available for less than $10,000), and any written settlements relating to any Intellectual Property, to which the Company is a party or otherwise bound.

 

(o) Board Determination . The Board of Directors of GCAN has unanimously determined that the terms of the Exchange are fair to and in the best interests of GCAN and its shareholders.

 

(p) Liabilities . GCAN has no liabilities or obligations of any nature (whether fixed or unfixed, secured or unsecured, known or unknown and whether absolute, accrued, contingent, or otherwise) except for $200,000 (the “Liability Cap”).

 

(q) Accounts Receivable . All of the accounts receivable of GCAN that are reflected in the GCAN SEC Documents or the accounting records of GCAN as of the Closing Date (collectively, the “ GCAN Accounts Receivable ”) represent or will represent valid obligations arising from sales actually made or services actually performed in the ordinary course of business and are not subject to any defenses, counterclaims, or rights of set off other than those arising in the ordinary course of business and for which adequate reserves have been established. The GCAN Accounts Receivable are fully collectible to the extent not reserved for on the balance sheet on which they are shown.

 

(r) Environmental Matters . GCAN is in compliance with all Environmental Laws in all material respects. GCAN holds all permits and authorizations required under applicable Environmental Laws, unless the failure to hold such permits and authorizations would not have a material adverse effect on GCAN, and is compliance with all terms, conditions and provisions of all such permits and authorizations in all material respects. GCAN has no liability, absolute or contingent, under any Environmental Law that if enforced or collected would have a material adverse effect on GCAN There are no past, pending or threatened claims under Environmental Laws against GCAN and GCAN is not aware of any facts or circumstances that could reasonably be expected to result in a liability or claim against GCAN pursuant to Environmental Laws.

 

(t) Full Disclosure. All of the representations and warranties made by GCAN in this Agreement, and all statements set forth in the certificates delivered by GCAN at the Closing pursuant to this Agreement, are true, correct and complete in all material respects and do not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make such representations, warranties or statements, in light of the circumstances under which they were made, misleading. The copies of all documents furnished by GCAN pursuant to the terms of this Agreement are complete and accurate copies of the original documents. The schedules, certificates, and any and all other statements and information, whether furnished in written or electronic form, to the Company or its representatives by or on behalf of GCAN and the GCAN Stockholders in connection with the negotiation of this Agreement and the transactions contemplated hereby do not contain any material misstatement of fact or omit to state a material fact or any fact necessary to make the statements contained therein not misleading.

 

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2.03 Representations and Warranties of Selling Shareholders

 

The Selling Shareholders jointly and severally represent and warrant to GCAN as follows:

 

(a) Ownership of the Shares . The Selling Shareholders own all of the Shares, free and clear of all liens, claims, rights, charges, encumbrances, and security interests of whatsoever nature or type, and the Selling Shareholders represent and warrant that the Shares represent the entire ownership interest of the Selling Shareholders in the Company.

 

(b) Power of Selling Shareholders to Execute Agreement . The Selling Shareholders have the full right, power, and authority to execute, deliver, and perform this Agreement.

 

ARTICLE III

 

ADDITIONAL AGREEMENTS AND COVENANTS

 

3.01 Best Efforts . Upon the terms and subject to the conditions set forth in this Agreement, each of the parties agrees to use its best efforts to take, or cause to be taken, all actions, and to do, or cause to be done, and to assist and cooperate with the other parties in doing, all things necessary, proper or advisable to consummate and make effective, in the most expeditious manner practicable, the Exchange and the other transactions contemplated by this Agreement. GCAN and the Company shall mutually cooperate in order to facilitate the achievement of the benefits reasonably anticipated from the Exchange.

 

3.02 Public Announcements . GCAN, on the one hand, and the Company, on the other hand, will consult with each other before issuing, and provide each other the opportunity to review and comment upon, any press release or other public statements with respect to the transactions contemplated by this Agreement and shall not issue any such press release or make any such public statement prior to such consultation, except as may be required by applicable law or court process. Each of the parties hereto agree that the initial press release or subsequent releases to be issued with respect to the transactions contemplated by this Agreement shall be mutually agreed upon prior to the issuance thereof.

 

3.03 Expenses . Subject to Section 2.02(h), all costs and expenses incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the party incurring such expenses.

 

3.04 Post-Exchange Capitalization . At Closing, GCAN will have no more than 29,380,969 shares of GCAN Common Stock issued and outstanding including the Exchange Shares.

 

3.05 Current Report . GCAN shall file a Current Report on Form 8-K with the SEC within four (4) business days of the Closing Date containing information about the Exchange (the “ 8-K Report ”). Additionally, within seventy one (71) days from the date that the 8-K report was required to filed, the Company shall have completed, and GCAN shall have received from the Company, audited financial statements and proforma financial statements as required to be filed by GCAN pursuant to the Exchange Act in an amendment to the 8-K Report.

 

ARTICLE IV

 

CONDITIONS PRECEDENT

 

4.01 Conditions to Each Party’s Obligation to Effect the Exchange . The obligation of each party to effect the Exchange and otherwise consummate the transactions contemplated by this Agreement is subject to the satisfaction, at or prior to the Closing, of each of the following conditions:

 

(a) No Restraints . No temporary restraining order, preliminary or permanent injunction or other order preventing the consummation of the Exchange shall have been issued by any court of competent jurisdiction or any other Governmental Entity having jurisdiction and shall remain in effect, and there shall not be any applicable legal requirement enacted, adopted or deemed applicable to the Exchange that makes consummation of the Exchange illegal.

 

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(b) Governmental Approvals . All authorizations, consents, orders, declarations or approvals of, or filings with, or terminations or expirations of waiting periods imposed by, any Governmental Entity having jurisdiction which the failure to obtain, make or occur would have a material adverse effect on GCAN or the Company shall have been obtained, made or occurred.

 

(c) No Litigation . There shall not be pending or threatened any suit, action or proceeding before any court, Governmental Entity or authority (i) pertaining to the transactions contemplated by this Agreement or (ii) seeking to prohibit or limit the ownership or operation by the Company, GCAN or any of its subsidiaries, (iii) or to dispose of or hold separate any material portion of the business or assets of the Company or GCAN

 

(d) Company and Selling Shareholders Approval . The Company and the Selling Shareholders shall have each adopted and approved this Agreement and the Exchange in accordance with applicable law.

 

(e) No Material Adverse Change. None of the events listed in Sections 2.01(g) and 2.02(g) shall have occurred or exist.

 

4.02 Conditions Precedent to Obligations of GCAN The obligation of GCAN to effect the Exchange and otherwise consummate the transactions contemplated by this Agreement is subject to the satisfaction, at or prior to the Closing, of each of the following conditions:

 

(a) Representations, Warranties and Covenants . The representations and warranties of the Company and the Selling Shareholders in this Agreement shall be true and correct in all material respects (except for such representations and warranties that are qualified by their terms by a reference to materiality or material adverse effect, which representations and warranties as so qualified shall be true and correct in all respects) both when made and on and as of the Closing Date, and the Company and the Selling Shareholders shall each have performed and complied in all material respects with all covenants, obligations and conditions of this Agreement required to be performed and complied with by each of them prior to the Effective Time.

 

(b) Consents . GCAN shall have received evidence, in form and substance reasonably satisfactory to it, that such licenses, permits, consents, approvals, authorizations, qualifications and orders of governmental authorities and other third parties as necessary in connection with the transactions contemplated hereby have been obtained.

 

(c) Officer’s Certificate of the Company . GCAN shall have received a certificate executed on behalf of the Company by an executive officer of the Company confirming that the conditions set forth in Section 4.02(a) have been satisfied.

 

(d) Selling Shareholder Representation Letter . Each of the Selling Shareholders shall have executed and delivered to GCAN a shareholder representation letter in substantially the form attached hereto as Exhibit B , and GCAN shall be reasonably satisfied that the issuance of GCAN Common Stock pursuant to the Exchange is exempt from the registration requirements of the Securities Act.

 

(e) Delivery of the Share Certificate . The Company shall have delivered the Share Certificates to GCAN on the Closing Date.

 

(f) Secretary’s Certificate of the Company . GCAN shall have received a certificate, dated as of the Closing Date, from the Secretary of the Company, certifying (i) as to the incumbency and signatures of the officers of the Company, who shall execute this Agreement and documents at the Closing, and (ii) that attached thereto is a true and complete copy of (A) the articles or certificate of incorporation of the Company and all amendments thereto, (B) the bylaws of the Company and all amendments thereto, and (C) resolutions of the Board of Directors of the Company and its shareholders authorizing the execution, delivery and performance of this Agreement by the Company.

 

(g) Due Diligence Investigation . GCAN shall be reasonably satisfied with the results of its due diligence investigation of the Company in its sole and absolute discretion.

 

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(h) Entry into the Wayne Anderson consulting agreement. The Wayne Anderson consulting agreement attached hereto as Schedule 4.02(h) shall be executed by each party thereto.

 

4.03 Conditions Precedent to Obligation of the Company . The obligation of the Company to effect the Exchange and otherwise consummate the transactions contemplated by this Agreement is subject to the satisfaction, at or prior to the Closing, of each of the following conditions:

 

(a) Representations, Warranties and Covenants . The representations and warranties of GCAN in this Agreement shall be true and correct in all material respects (except for such representations and warranties that are qualified by their terms by a reference to materiality or material adverse effect, which representations and warranties as so qualified shall be true and correct in all respects) both when made and on and as of the Closing Date, and GCAN shall have performed and complied in all material respects with all covenants, obligations and conditions of this Agreement required to be performed and complied with by it prior to the Effective Time.

 

(b) Consents . The Company shall have received evidence, in form and substance reasonably satisfactory to it, that such licenses, permits, consents, approvals, authorizations, qualifications and orders of governmental authorities and other third parties as necessary in connection with the transactions contemplated hereby have been obtained.

 

(c) Officer’s Certificate of GCAN The Company shall have received a certificate executed on behalf of GCAN by an executive officer of GCAN, confirming that the conditions set forth in Section 4.03(a) have been satisfied.

 

(d) Board Resolutions . The Company shall have received resolutions duly adopted by GCAN’s Board of Directors approving the execution, delivery and performance of the Agreement and the transactions contemplated by the Agreement.

 

(e) Due Diligence Investigation . The Company shall be reasonably satisfied with the results of its due diligence investigation of GCAN in its sole and absolute discretion.

 

(f) New Directors and Officers . GCAN shall also have delivered to the Company letters of resignation executed by each of the GCAN officers set forth on Schedule 1.05 to be effective on or before the Closing Date, and evidence of appointment of those new directors and officers set forth on Schedule 1.05 .

 

(g) Indemnification Agreements . GCAN shall have delivered to each of its directors and officers an executed indemnification agreement in substantially the form attached hereto as Exhibit C .

 

ARTICLE V

 

INDEMNIFICATION AND RELATED MATTERS

 

5.01 Survival of Representations and Warranties . The representations and warranties in this Agreement or in any instrument delivered pursuant to this Agreement shall survive until twelve (12) months after the Effective Time (except for with respect to Taxes which shall survive for the applicable statute of limitations plus ninety (90) days, and covenants that by their terms survive for a longer period).

 

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5.03 Notice of Indemnification . Promptly after the receipt by any indemnified party (the “ Indemnitee ”) of notice of the commencement of any action or proceeding against such Indemnitee, such Indemnitee shall, if a claim with respect thereto is or may be made against any indemnifying party (the “ Indemnifying Party ”) pursuant to this Article V, give such Indemnifying Party written notice of the commencement of such action or proceeding and give such Indemnifying Party a copy of such claim and/or process and all legal pleadings in connection therewith. The failure to give such notice shall not relieve any Indemnifying Party of any of its indemnification obligations contained in this Article V, except where, and solely to the extent that, such failure actually and materially prejudices the rights of such Indemnifying Party. Such Indemnifying Party shall have, upon request within thirty (30) days after receipt of such notice, but not in any event after the settlement or compromise of such claim, the right to defend, at its own expense and by its own counsel reasonably acceptable to the Indemnitee, any such matter involving the asserted liability of the Indemnitee; provided, however, that if the Indemnitee determines that there is a reasonable probability that a claim may materially and adversely affect it, other than solely as a result of money payments required to be reimbursed in full by such Indemnifying Party under this Article V or if a conflict of interest exists between Indemnitee and the Indemnifying Party, the Indemnitee shall have the right to defend, compromise or settle such claim or suit; and, provided, further, that such settlement or compromise shall not, unless consented to in writing by such Indemnifying Party, which shall not be unreasonably withheld, be conclusive as to the liability of such Indemnifying Party to the Indemnitee. In any event, the Indemnitee, such Indemnifying Party and its counsel shall cooperate in the defense against, or compromise of, any such asserted liability, and in cases where the Indemnifying Party shall have assumed the defense, the Indemnitee shall have the right to participate in the defense of such asserted liability at the Indemnitee’s own expense. In the event that such Indemnifying Party shall decline to participate in or assume the defense of such action, prior to paying or settling any claim against which such Indemnifying Party is, or may be, obligated under this Article V to indemnify an Indemnitee, the Indemnitee shall first supply such Indemnifying Party with a copy of a final court judgment or decree holding the Indemnitee liable on such claim or, failing such judgment or decree, the terms and conditions of the settlement or compromise of such claim. An Indemnitee’s failure to supply such final court judgment or decree or the terms and conditions of a settlement or compromise to such Indemnifying Party shall not relieve such Indemnifying Party of any of its indemnification obligations contained in this Article V, except where, and solely to the extent that, such failure actually and materially prejudices the rights of such Indemnifying Party. If the Indemnifying Party is defending the claim as set forth above, the Indemnifying Party shall have the right to settle the claim only with the consent of the Indemnitee.

 

ARTICLE VI

 

GENERAL PROVISIONS

 

6.01 Notices . Any and all notices and other communications hereunder shall be in writing and shall be deemed duly given to the party to whom the same is so delivered, sent or mailed at addresses and contact information set forth below (or at such other address for a party as shall be specified by like notice.) Any and all notices or other communications or deliveries required or permitted to be provided hereunder shall be deemed given and effective on the earliest of: (a) on the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number set forth on the signature pages attached hereto prior to 5:30 p.m. (Pacific Standard Time) on a business day, (b) on the next business day after the date of transmission, if such notice or communication is delivered via facsimile at the facsimile number set forth on the signature pages attached hereto on a day that is not a business day or later than 5:30 p.m. (Pacific Standard Time) on any business day, (c) on the second business day following the date of mailing, if sent by a nationally recognized overnight courier service, or (d) if by personal delivery, upon actual receipt by the party to whom such notice is required to be given.

 

If to GCAN :

 

GCAN

Attention: Wayne Anderson – President and Chief Executive Officer

wa@sylios.com

 

If to the Company :

 

GreenC Corporation.

Attention: Aitan Zacharin

aitanzacharin@gmail.com

and to: Elisha Kalfa

elisha@focusglobalsupply.com

and to: Joe Kalfa

joekalfa@gmail.com

 

All Notices to the Selling Shareholders shall be sent “care of” the Company.

 

6.02 Definitions . For purposes of this Agreement:

 

(a) an “affiliate” of any person means another person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, such first person;

 

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(b) “material adverse change” or “material adverse effect” means, when used in connection with the Company or GCAN, any change or effect that either individually or in the aggregate with all other such changes or effects is materially adverse to the business, assets, properties, condition (financial or otherwise) or results of operations of such party and its subsidiaries taken as a whole (after giving effect in the case of GCAN to the consummation of the Exchange);

 

(c) “ordinary course of business” means the ordinary course of business consistent with past custom and practice (including with respect to quantity and frequency);

 

(d) “person” means an individual, corporation, partnership, joint venture, association, trust, unincorporated organization or other entity;

 

(e) “subsidiary” of any person means another person, an amount of the voting securities, other voting ownership or voting partnership interests of which is sufficient to elect at least a majority of its board of directors or other governing body (or, if there are no such voting interests, fifty percent (50%) or more of the equity interests of which) that is owned directly or indirectly by such first person; and

 

(f) “security interest” means any mortgage, pledge, lien, encumbrance, deed of trust, lease, charge, right of first refusal, easement, servitude, proxy, voting trust or agreement, transfer restriction under any shareholder or similar agreement or any other security interest, other than (i) mechanic’s, materialmen’s, and similar liens, (ii) statutory liens for taxes not yet due and payable, (c) purchase money liens and liens securing rental payments under capital lease arrangements, (iii) pledges or deposits made in the ordinary course of business in connection with workers’ compensation, unemployment insurance or other similar social security legislation; and (iv) encumbrances, security deposits or reserves required by law or by any Governmental Entity.

 

6.03 Interpretation . When a reference is made in this Agreement to a Section, Exhibit or Schedule, such reference shall be to a Section of, or an Exhibit or Schedule to, this Agreement unless otherwise indicated. The headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement. Whenever the words “include,” “includes” or “including” are used in this Agreement, they shall be deemed to be followed by the words “without limitation.”

 

6.04 Entire Agreement; No Third-Party Beneficiaries . This Agreement and the other agreements referred to herein constitute the entire agreement, and supersede all prior agreements and understandings, both written and oral, among the parties with respect to the subject matter of this Agreement. This Agreement is not intended to confer upon any person other than the parties any rights or remedies.

 

6.05 Governing Law . This Agreement shall be governed by, and construed in accordance with, the laws of the State of Florida, regardless of the laws that might otherwise govern under applicable principles of conflicts of laws thereof.

 

6.06 Assignment . Neither this Agreement nor any of the rights, interests or obligations under this Agreement shall be assigned, in whole or in part, by operation of law or otherwise by any of the parties without the prior written consent of the other parties. Subject to the preceding sentence, this Agreement will be binding upon, inure to the benefit of, and be enforceable by, the parties and their respective successors and assigns.

 

6.07 Enforcement . The parties agree that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed that the parties shall be entitled to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions of this Agreement in any court of the United States located in the State of Florida, this being in addition to any other remedy to which they are entitled at law or in equity. In addition, each of the parties hereto (a) agrees that it will not attempt to deny or defeat such personal jurisdiction or venue by motion or other request for leave from any such court, and (b) agrees that it will not bring any action relating to this Agreement or any of the transactions contemplated by this Agreement in any state court other than such court.

 

6.08 Severability . Whenever possible, each provision or portion of any provision of this Agreement will be interpreted in such manner as to be effective and valid under applicable law but if any provision or portion of any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability will not affect any other provision or portion of any provision in such jurisdiction, and this Agreement will be reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable provision or portion of any provision had never been contained herein.

 

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6.09 Counterparts . This Agreement may be executed simultaneously in two or more counterparts, any one of which need not contain the signatures of more than one party, but all such counterparts taken together will constitute one and the same Agreement. This Agreement, to the extent delivered by means of a facsimile machine or electronic mail (any such delivery, an “ Electronic Delivery ”), shall be treated in all manner and respects as an original agreement or instrument and shall be considered to have the same binding legal effect as if it were the original signed version thereof delivered in person. At the request of any party hereto, each other party hereto shall re-execute original forms hereof and deliver them in person to all other parties. No party hereto shall raise the use of Electronic Delivery to deliver a signature or the fact that any signature or agreement or instrument was transmitted or communicated through the use of Electronic Delivery as a defense to the formation of a contract, and each such party forever waives any such defense, except to the extent such defense related to lack of authenticity.

 

6.10 Attorneys Fees . In the event any suit or other legal proceeding is brought for the enforcement of any of the provisions of this Agreement, the parties hereto agree that the prevailing party or parties shall be entitled to recover from the other party or parties upon final judgment on the merits reasonable attorneys’ fees, including attorneys’ fees for any appeal, and costs incurred in bringing such suit or proceeding.

 

6.11 Currency . All references to currency in this Agreement shall refer to the lawful currency of the United States of America.

 

[ Signature Page Follows ]

 

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IN WITNESS WHEREOF, the undersigned have caused their duly authorized officers to execute this Agreement as of the date first above written.

 

 

The Greater Cannabis Company, Inc.:

     
  By:

/s/ Wayne Anderson

    Wayne Anderson
    President and Chief Executive Officer

 

  Company :
     
  Green C Corporation
     
  By: /s/ Elisha Kalfa
   

Elisha Kalfa

    Chief Executive Officer

 

[Signature Page to Share Exchange Agreement]

 

  19  
 

   

COUNTERPART SIGNATURE PAGE

TO

SHARE EXCHANGE AGREEMENT

 

 

Selling Shareholder :

     
  2490585 Ontario Inc.:
     
  /s/ Elisha Kalfa                 
  By: Elisha Kalfa
  Title: Authorized Signatory

 

[Signature Page to Share Exchange Agreement]

 

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EXHIBIT A

 

List of Selling Shareholders   Exchange Shares*  
       
2490585 Ontario Inc.   2,966,666  

 

*Preferred Shares that have the rights, obligations, privileges and features set forth on the certificate of designation in respect of such shares, in each case, subject to any agreements to be entered into in respect of such shares.

 

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EXHIBIT B

 

July __, 2018

 

Greater Cannabis Company, Inc.

244 2nd Ave N

Suite 9

St. Petersburg, FL 33701

 

Shareholder Representation Letter

 

Ladies and Gentlemen:

 

Pursuant to a Share Exchange Agreement (the “ Agreement ”) dated as of July 31, 2018 (the “ Agreement Date ”), the undersigned (the “ Shareholder ”) shall receive from Greater Cannabis Company, Inc., a Florida corporation (“ GCAN ”), shares of GCAN common stock (the “ Securities ”) in consideration of the Shareholder’s ownership of capital stock of Green C Corporation., a company incorporated under the laws of the Province of Ontario (the “ Company ”) pursuant to a voluntary share exchange transaction in accordance with the Florida Business Corporation Act (the “ Exchange ”). Capitalized terms used herein but not defined will have the meanings ascribed to them in the Agreement. The Shareholder whose signature appears below, represents and warrants to GCAN that, as of the date first written above and as of the Closing Date, the statements contained in this Shareholder Representation Letter are, and will be, correct and complete:

 

1. REPRESENTATIONS AND WARRANTIES OF SHAREHOLDER .

 

1.1. “Accredited” Investor . The Exchange pursuant to the Agreement, and the distribution of the Securities to the Shareholder at the Closing, are intended to be exempt from registration under the Securities Act of 1933, as amended (the “ Act ”). Unless the Shareholder checks the “no” box on the signature page hereof indicating that the Shareholder is not an Accredited Investor, the Shareholder represents and warrants that the Shareholder falls within one of the following definitions of Accredited Investor:

 

(Please initial the category that applies)

 

_______ (a) The Shareholder is a natural person whose individual net worth, or joint net worth with spouse, exceeds $1,000,000.

 

Explanation . In calculating net worth, you include all of your assets (other than your primary residence) whether liquid or illiquid, such as cash, stock, securities, personal property and real estate based on the fair market value of such property MINUS all debts and liabilities (other than a mortgage or other debt secured by your primary residence). In the event that the amount of any mortgage or other indebtedness secured by your primary residence exceeds the fair market value of the residence, that excess liability should also be deducted from your net worth. Any mortgage or indebtedness secured by your primary residence incurred within 60 days before the time of the sale of the Securities offered hereunder, other than as a result of the acquisition of the primary residence, shall also be deducted from your net worth.

 

_______ (b) The Shareholder is a natural person who had an individual income in excess of $200,000 in each of the last two years or joint income with spouse in excess of $300,000 in each of those years and reasonably expects to reach the same income level in the current year.

 

_______ (c) The Shareholder is either a director or executive officer of GCAN

 

_______ (d) The Shareholder is a corporation or other entity with total assets in excess of US$5,000,000, not formed for the specific purpose of acquiring the Securities.

 

_______ (e) The Shareholder is an entity, all of the equity owners of which are as specified in (a) or (b) above.

 

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The Shareholder further certifies that: (i) the Shareholder has the capacity to protect the Shareholder’s interests in this investment; (ii) the Shareholder is able to bear the economic risks of this investment; and (iii) the amount of the investment does not exceed 10% of the Shareholder’s net worth or joint net worth with spouse.

 

1.2. Regulation S; Non-U.S. Person Status . For purposes of compliance with the Regulation S exemption for the acquisition of the Securities by non-U.S. Persons, the Shareholder makes the following representations, warranties and covenants:

 

(a) The Shareholder is a person or entity that is outside the United States and is not a “US Person,” as such term is defined in Rule 902(k) of Regulation S . 1

 

(b) The Shareholder is not acquiring the Securities for the account or benefit of a US Person.

 

(c) The Shareholder has been independently advised as to the applicable holding period imposed in respect of the Securities by securities legislation in the jurisdiction in which it resides and confirms that no representation has been made respecting the applicable holding periods for the Securities in such jurisdiction and it is aware of the risks and other characteristics of the Securities and of the fact that holders of Securities may not be able to resell the Securities except in accordance with applicable securities legislation and regulatory policy.

 

 

1 Regulation S provides in part as follows:

 

1. “U.S. person” means: (i) any natural person resident in the United States; (ii) any partnership or corporation organized or incorporated under the laws of the United States; (iii) any estate of which any executor or administrator is a U.S. person; (iv) any trust of which any trustee is a U.S. person; (v) any agency or branch of a foreign entity located in the United States; (vi) any non-discretionary account or similar account (other than an estate or trust) held by a dealer or other fiduciary for the benefit or account of a U.S. person; (vii) any discretionary account or similar account (other than an estate or trust) held by a dealer or other fiduciary organized, incorporated, or (if an individual) resident in the United States; and (viii) any partnership or corporation if: (A) organized or incorporated under the laws of any foreign jurisdiction; and (B) formed by a U.S. person principally for the purpose of investing in securities not registered under the Act, unless it is organized or incorporated, and owned, by accredited investors (as defined in Rule 501(a)) who are not natural persons, estates or trusts.

 

2. The following are not “U.S. persons”: (i) any discretionary account or similar account (other than an estate or trust) held for the benefit or account of a non-U.S. person by a dealer or other professional fiduciary organized, incorporated, or (if an individual) resident in the United States; (ii) any estate of which any professional fiduciary acting as executor or administrator is a U.S. person if: (A) an executor or administrator of the estate who is not a U.S. person has sole or shared investment discretion with respect to the assets of the estate; and (B) the estate is governed by foreign law; (iii) any trust of which any professional fiduciary acting as trustee is a U.S. person, if a trustee who is not a U.S. person has sole or shared investment discretion with respect to the trust assets, and no beneficiary of the trust (and no settlor if the trust is revocable) is a U.S. person; (iv) an employee benefit plan established and administered in accordance with the law of a country other than the United States and customary practices and documentation of such country; (v) any agency or branch of a U.S. person located outside the United States if: (A) the agency or branch operates for valid business reasons; and (B) the agency or branch is engaged in the business of insurance or banking and is subject to substantive insurance or banking regulation, respectively, in the jurisdiction where located; and (vi) the International Monetary Fund, the International Bank for Reconstruction and Development, the Inter-American Development Bank, the Asian Development Bank, the African Development Bank, the United Nations, and their agencies, affiliates and pension plans, and any other similar international organizations, their agencies, affiliates and pension plans.

 

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(d) To the knowledge of the Shareholder, without having made any independent investigation, neither GCAN or the Company nor any person acting for GCAN or the Company, has conducted any “directed selling efforts” in the United States as the term “directed selling efforts” is defined in Rule 902 of Regulation S, which, in general, means any activity undertaken for the purpose of, or that could reasonably be expected to have the effect of, conditioning the marketing in the United States for any of the Securities being offered. Such activity includes, without limitation, the mailing of printed material to investors residing in the United States, the holding of promotional seminars in the United States, and the placement of advertisements with radio or television stations broadcasting in the United States or in publications with a general circulation in the United States, which discuss the offering of the Securities. To the knowledge of the Shareholder, the Securities were not offered to the Shareholder through, and the Shareholder is not aware of, any form of general solicitation or general advertising, including without limitation, (i) any advertisement, article, notice or other communication published in any newspaper, magazine or similar media or broadcast over television or radio, and (ii) any seminar or meeting whose attendees have been invited by any general solicitation or general advertising.

 

(e) The Shareholder will offer, sell or otherwise transfer the Securities, only (i) pursuant to a registration statement that has been declared effective under the Act, (ii) pursuant to offers and sales that occur outside the United States within the meaning of Regulation S in a transaction meeting the requirements of Rule 904 (or other applicable Rule) under the Act, or (iii) pursuant to another available exemption from the registration requirements of the Act, subject to GCAN’s right prior to any offer, sale or transfer pursuant to clauses (ii) or (iii) to require the delivery of an opinion of counsel, certificates or other information reasonably satisfactory to GCAN for the purpose of determining the availability of an exemption.

 

(f) The Shareholder will not engage in hedging transactions involving the Securities unless such transactions are in compliance with the Act.

 

(g) The Shareholder represents and warrants that the Shareholder is not a citizen of the United States and is not, and has no present intention of becoming, a resident of the United States (defined as being any natural person physically present within the United States for at least 183 days in a 12-month consecutive period or any entity who maintained an office in the United States at any time during a 12-month consecutive period). The Shareholder understands that GCAN may rely upon the representations and warranty of this paragraph as a basis for an exemption from registration of the Securities under the Act, and the provisions of relevant state securities laws.

 

(h) The Shareholder hereby represents that he, she or it has satisfied and fully observed the laws of the jurisdiction in which he, she or it is located or domiciled, in connection with the acquisition of the Securities, including (i) the legal requirements of the Shareholder’s jurisdiction for the acquisition of the Securities, (ii) any foreign exchange restrictions applicable to such acquisition, (iii) any governmental or other consents that may need to be obtained, and (iv) the income tax and other tax consequences, if any, which may be relevant to the holding, redemption, sale, or transfer of the Securities; and further, the Shareholder agrees to continue to comply with such laws as long as he, she or it shall hold the Securities.

 

1.3. Holding For Own Account . The Shareholder is acquiring an interest in the Securities for the Shareholder’s own account, for investment purposes only, and not with a view toward the resale or distribution thereof within the meaning of the Act, except pursuant to effective registrations or qualifications relating thereto under the Act and applicable state securities or blue sky laws or pursuant to an exemption therefrom.

 

1.4. Unregistered Securities; Restrictions on Transfer . The Shareholder understands that: (a) the Securities have not been registered under the Act or the securities laws of any state or other jurisdiction in reliance upon exemptions from such registration requirements for non-public offerings; (b) the Securities may not be sold, pledged or otherwise transferred except pursuant to effective registrations or qualifications relating thereto under the Act and other applicable securities laws or pursuant to an exemption therefrom; and (c) neither GCAN or the Company are under any obligation to register or qualify the Securities under the Act or any other applicable securities laws, or to take any action to make any exemption from any such registration provisions available. The Shareholder understands that the Shareholder may not transfer any Securities unless such Securities are registered under the Act or qualified under applicable state securities laws or unless with respect to the Securities, in the reasonable opinion of counsel to GCAN, exemptions from such registration and qualification requirements are available. GCAN may require an opinion to such effect from counsel to the Shareholder reasonably satisfactory to GCAN The Shareholder has also been advised that exemptions from registration and qualification may not be available or may not permit the Shareholder to transfer all or any of the Securities in the amounts or at the times proposed by the Shareholder.

 

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1.5. Securities Law Restrictions . The Shareholder will not sell, assign or transfer any of the Securities received by the Shareholder in connection with the Agreement except (a) pursuant to an effective registration statement under the Act, (b) in conformity with the volume and other limitations of Securities and Exchange Commission Rule (“ SEC ”) Rule 144 promulgated under the Act (“ Rule 144 ”), or (c) in a transaction which, in the opinion of independent counsel to the Shareholder delivered to GCAN and satisfactory to GCAN, is not required to be registered under the Act. GCAN shall not have any obligation to effect a transfer of any Securities that is not in compliance with applicable federal and state securities laws.

 

1.6. Rule 144; Legends . The Shareholder has been advised and acknowledges that Rule 144, which permits certain limited sales of unregistered securities, is not presently available with respect to the Securities and, in any event, requires that the Securities be held for a minimum of six months (and the sale thereof may be subject to certain volume and other limitations under Rule 144), after they have been purchased and paid for (within the meaning of Rule 144), before they may be resold under Rule 144. The Shareholder understands that Rule 144 may indefinitely apply to and restrict transfer of the Securities if the Shareholder is an “affiliate” of GCAN and “current public information” about GCAN (as defined in Rule 144) is not publicly available. The Shareholder further understands that, if applicable, sales under Rule 144 are not available to the Shareholder during such time as GCAN remains a “shell company” (as defined in Rule 405 promulgated under the 1933 Act).

 

GCAN may place any legend contemplated by the Agreement, one or more of the legends below, or such other legends as it may reasonably deem appropriate, on each certificate or instrument representing Securities:

 

THE SHARES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR UNDER THE SECURITIES OR BLUE SKY LAWS OF ANY STATE AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT OR IN A TRANSACTION WHICH IS NOT SUBJECT TO THE REGISTRATION REQUIREMENTS OF THE ACT OR ANY APPLICABLE SECURITIES OR BLUE SKY LAWS AND, IN THE CASE OF A TRANSACTION NOT SUBJECT TO SUCH REGISTRATION REQUIREMENTS, UNLESS THE ISSUER HAS RECEIVED AN OPINION OF COUNSEL TO THE HOLDER REASONABLY SATISFACTORY TO IT THAT SUCH TRANSACTION DOES NOT REQUIRE REGISTRATION UNDER THE ACT.

 

1.7. Shareholder’s Business Experience . The Shareholder has, alone or together with the Shareholder’s representative, if any, such knowledge and experience in financial and business matters so that the Shareholder is capable of evaluating the relative merits and risks of the investment in the Securities that is represented by the Agreement and the transactions contemplated thereby. The Shareholder has adequate means of providing for its, his or her current economic needs and possible personal contingencies, has no need for liquidity in its, his or her investment in GCAN and is able financially to bear the risks of such investment.

 

1.8. Availability of Information . The Shareholder acknowledges that the Shareholder has had access to all information regarding GCAN and its present and prospective business, assets, liabilities and financial condition that the Shareholder reasonably considers important in making the decision to acquire the Securities pursuant to the Exchange, and that all documents, records and books pertaining to the investment in GCAN resulting from the Agreement and requested by the Shareholder or the Shareholder’s representative, if any, have been made available or delivered to the Shareholder, to the extent that GCAN possesses such information or can obtain such information without unreasonable efforts or expense.

 

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1.9. Opportunity to Ask Questions . The Shareholder or the Shareholder’s representative, if any, has had an opportunity to discuss GCAN’s business, management and financial affairs with GCAN’s management and to ask questions of and receive answers from GCAN, or a person or persons acting on behalf of GCAN, concerning the business of GCAN The Shareholder acknowledges that all such questions, if any, have been answered to the Shareholder’s satisfaction.

 

1.10. Shareholder Representation Letter . The Shareholder has carefully read this Shareholder Representation Letter and, to the extent the Shareholder believes necessary, has discussed with the Shareholder’s counsel the representations, warranties and agreements that the Shareholder makes herein and the applicable limitations upon the Shareholder’s resale of the Securities.

 

1.11. GCAN Information . The Shareholder is also aware of and acknowledges the following:

 

(a) that no federal or state agency has made any finding or determination regarding the fairness of this investment, or any recommendation or endorsement of the Securities;

 

(b) that neither the officers, directors, agents, affiliates or employees of GCAN or the Company, nor any other person, has expressly or by implication, made any representation or warranty to the Shareholder concerning GCAN or the Company; and

 

(c) that the past performance or experience of GCAN or the Company or their respective officers, directors, agents or employees will not in any way indicate or predict the results of the ownership of Securities or of GCAN’s activities.

 

1.12. Stop Transfer Instructions; No Requirement to Transfer . The Shareholder agrees that, in order to ensure compliance with the restrictions referred to herein, GCAN may issue appropriate “stop transfer” instructions to its transfer agent. GCAN shall not be required (a) to transfer or have transferred on its books any Securities that have been sold or otherwise transferred in violation of any of the provisions of this Shareholder Representation Letter or the Agreement or (b) to treat as owner of such Securities or to accord the right to vote or pay dividends to any shareholder or other transferee to whom such Securities shall have been so transferred in violation of any provision of this Shareholder Representation Letter or the Agreement.

 

1.13. No Public Solicitation . The Shareholder represents that at no time was the Shareholder presented with or solicited by any general mailing, leaflet, public promotional meeting, newspaper or magazine article, radio or television advertisement, or any other form of general advertising or general solicitation in connection with the transactions contemplated by the Agreement.

 

1.14. Principal Residence . The address shown under the Shareholder’s signature on the signature page hereof is the Shareholder’s principal residence.

 

1.15. Indemnification . The Shareholder will indemnify and hold harmless GCAN and the Company and their respective officers, directors, managers and counsel, from and against any and all damages, losses, liabilities or expenses (including all legal fees and costs) directly or indirectly incurred, resulting or arising out of the breach of any of the representations, warranties or covenants given or made in this Shareholder Representation Letter.

 

1.16. Authorization of Transaction . The Shareholder has full power and authority to execute and deliver this Shareholder Representation Letter and to perform the Shareholder’s obligations hereunder.

 

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1.17. Disposition of Securities . The Shareholder is not a party to any option, warrant, purchase right, or other contract or commitment that could require the Shareholder to sell, transfer, or otherwise dispose of any of the Securities.

 

2. SHARE EXCHANGE AGREEMENT . The Shareholder agrees that the Securities will be subject to and bound by, all of the provisions of the Agreement relating to the Securities.

 

3. ENTIRE AGREEMENT . The Agreement and this Shareholder Representation Letter constitute the entire agreement and understanding of the parties with respect to the subject matter of this Shareholder Representation Letter, and supersede all prior understandings and agreements, whether oral or written, between or among the parties hereto with respect to the specific subject matter hereof.

 

4. COUNTERPARTS . This Shareholder Representation Letter may be executed in several counterparts, each of which shall be an original, but all of which together shall constitute one and the same agreement.

 

5. EFFECT OF HEADINGS . The section headings herein are for convenience only and shall not affect the construction or interpretation of this Shareholder Representation Letter.

 

6. GOVERNING LAW; CONSENT TO JURISDICTION . This Shareholder Representation Letter shall be governed by, and construed in accordance with, the internal laws of the State of Florida applicable to contracts executed in and to be performed by residents of Florida within that State.

 

7. NO TAX REPRESENTATIONS . The Shareholder represents, warrants and acknowledges that the Shareholder is not relying on GCAN or the Company for any tax advice concerning the federal or state income or other tax consequences of the transactions contemplated by the Agreement or the Shareholder’s receipt of the Securities, and that the Shareholder has consulted such advisors as the Shareholder deems necessary or appropriate to understand the tax consequences of the investment represented by the Securities.

 

[Signature Page Follows]

 

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  SHAREHOLDER
   
   
  Signature
   
   
  Name (Please Type or Print)
   
   
  Title (Please Type or Print) (if applicable)
   
   
  Street Address
   
   
  City, State, Zip Code
   
   
  Country
   
   
  Social Security Number
  (or tax I.D. Number, if an entity)
   
  Accredited Investor:
   
  (Please Check One of the Following Boxes)
   
  [  ] Yes        [  ] No

 

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EXHIBIT C

 

FORM OF INDEMNIFICATION AGREEMENT

 

This Indemnification Agreement (this “Agreement”), dated as of July 31, 2018, is made by and between Greater Cannabis Company, Inc., a Florida corporation (the “Company”), and the undersigned, who is either a director or an officer (or both) of the Company (the “Indemnitee”), with this Agreement to be deemed effective as of the date that the Indemnitee first assumed either such capacity at the Company.

 

RECITALS

 

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

 

B. The Board of Directors of the Company (the “Board”) has concluded that, to retain and attract talented and experienced individuals to serve as officers or directors of the Company, it is necessary for the Company contractually to indemnify certain of such persons and to assume for itself maximum liability for expenses and damages in connection with claims against such persons in connection with their service to the Company;

 

C. Section 607.0850 (1) of Chapter 607 of the Florida Business Corporation Act, under which the Company is organized (“Section 607.0850”), empowers the Company to indemnify by agreement its present and former officers and directors and persons who serve, at the request of the Company, as directors or officers of other corporations, partnerships, joint ventures, trusts, or other enterprises and expressly provides that the indemnification provided by Section 607.0850 is not exclusive; and

 

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

 

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

 

1. Definitions

 

1.1 Agent . For the purposes of this Agreement, “agent” of the Company means any person who is or was a director or an officer of the Company or a subsidiary of the Company; or is or was serving at the request of the Company or a subsidiary of the Company as a director or an officer of another foreign or domestic corporation, partnership, joint venture, trust, or other enterprise or an affiliate of the Company. The term “enterprise” includes any employee benefit plan of the Company, its subsidiaries, affiliates, and predecessor corporations.

 

1.2 Company . For purposes of this Agreement, the “Company” includes, in addition to the resulting corporation, any constituent corporation (including any constituent of a constituent) absorbed in a consolidation or merger that, if its separate existence had continued, would have had power and authority to indemnify its directors or officers so that any person who is or was a director or an officer of such constituent corporation, or is or was serving at the request of such constituent corporation as a director or an officer of another corporation, partnership, joint venture, trust, or other enterprise, shall stand in the same position under this Agreement with respect to the resulting or surviving corporation as such person would have with respect to such constituent corporation if its separate existence had continued.

 

1.3 Expenses . For the 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 the investigation, defense, or appeal of a proceeding or establishing or enforcing a right to indemnification or advancement of expenses under this Agreement, Section [  ] or otherwise; provided , however , that expenses shall not include any judgments, fines, ERISA excise taxes or penalties, or amounts paid in settlement of a proceeding.

 

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1.4 Fines . For purposes of this Agreement, references to “fines” includes any excise taxes assessed on a person with respect to any employee benefit plan.

 

1.5 Liabilities . For purposes of this Agreement, “liabilities” means judgments, fines, ERISA execute taxes or penalties, and amounts paid in settlement in connection with a proceeding.

 

1.6 Other Enterprises . For purposes of this Agreement, “other enterprises” includes employee benefit plans.

 

1.7 Proceeding . For the purposes of this Agreement, “proceeding” means any threatened, pending, or completed action, suit, or other proceeding, whether civil, criminal, administrative, or investigative.

 

1.8 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 of its subsidiaries, or by one or more of the Company’s subsidiaries.

 

1.9 Serving at the Request of the Company . For purposes of this Agreement, “serving at the request of the Company” includes any service as a director or an officer of the Company that imposes duties on, or involves services by, such director or officer with respect to an employee benefit plan, its participants or beneficiaries; and a person who acted in good faith and in a manner such person reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan shall be deemed to have acted in a manner “not opposed to the best interests of the Company” as referred to in this Agreement.

 

2. Agreement to Serve . The Indemnitee agrees to serve and/or continue to serve as an agent of the Company, at the will of the Company (or under separate agreement, if such agreement exists), in the capacity the Indemnitee currently serves as an agent of the Company, faithfully and to the best of his ability, so long as he is duly appointed or elected and qualified in accordance with the applicable provisions of the charter documents of the Company or any subsidiary of the Company; provided , however , that the Indemnitee may at any time and for any reason resign from such position (subject to any contractual obligation that the Indemnitee may have assumed apart from this Agreement), and the Company and any subsidiary shall have no obligation under this Agreement to continue the Indemnitee in any such position.

 

3. Directors’ and Officers’ Insurance . The Company shall, to the extent that the Board determines it to be economically reasonable, maintain a policy of directors’ and officers’ liability insurance (“D&O Insurance”), on such terms and conditions as may be approved by the Board.

 

4. Mandatory Indemnification . Subject to Section 9 below, the Company hereby agrees to hold harmless and indemnify the Indemnitee to the fullest extent permitted by law, as such may be amended from time to time. In furtherance of the foregoing indemnification, and without limiting the generality thereof:

 

4.1 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 (except an action by or in the right of the Company) 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 the Indemnitee in any such capacity, against any and all expenses and liabilities of any type whatsoever incurred by the Indemnitee in connection with such proceeding if (a) the Indemnitee acted in good faith and in a manner the Indemnitee 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 the Indemnitee’s conduct was unlawful, or (b) the Indemnitee, if a director or an officer of the Company, did not act or fail to act in a manner that constituted a breach of the Indemnitee’s fiduciary duties as a director or an officer or such Indemnitee’s breach of those duties did not involve intentional misconduct, fraud, or a knowing violation of law; and

 

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4.2 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 the Indemnitee is or was an agent of the Company, or by reason of anything done or not done by the Indemnitee in any such capacity, against any and all expenses and liabilities incurred by the Indemnitee in connection with such proceeding if (a) the Indemnitee acted in good faith and in a manner the Indemnitee reasonably believed to be in, or not opposed to, the best interests of the Company, or (b) the Indemnitee, if a director or an officer of the Company, did not act or fail to act in a manner that constituted a breach of the Indemnitee’s fiduciary duties as a director or an officer or such Indemnitee breach of those duties involved intentional misconduct, fraud, or a knowing violation of law; except that no indemnification under this subsection shall be made in respect of any claim, issue, or matter as to which the Indemnitee shall have been adjudged by a court of competent jurisdiction, after the exhaustion of all appeals therefrom, to be liable to the Company or for amounts paid in settlement to the Company, unless and only to the extent that the court in which such proceeding was brought or another court of competent jurisdiction determines upon application that, in view of all the circumstances of the case, the Indemnitee is fairly and reasonable entitled to indemnity for such expenses as the court deems proper; and

 

4.3 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, fines, ERISA excise taxes or penalties, and amounts paid in settlement) to the extent such have been paid to the Indemnitee by D&O Insurance.

 

4.4 Indemnification for Expenses as a Witness . Notwithstanding any other provision of this Agreement, to the extent that Indemnitee is, by reason of the Indemnitee’s status as an agent of the Company, a witness, or is made (or asked) to respond to discovery requests, in any proceeding to which Indemnitee is not a party, the Indemnitee shall be indemnified against all expenses and liabilities of any type whatsoever actually and reasonably incurred by him or her or on his or her behalf in connection therewith.

 

5. Partial Indemnification and Contribution .

 

5.1 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 incurred by the Indemnitee in connection with a proceeding but is not entitled, however, to indemnification for all of the total amount thereof, then the Company shall nevertheless indemnify the Indemnitee for such total amount except as to the portion thereof to which the Indemnitee is not entitled to indemnification.

 

5.2 Contribution . If the Indemnitee is not entitled to the indemnification provided in Section 4 for any reason other than the statutory limitations set forth in the Florida Revised Statutes, then in respect of proceeding in which the Company is jointly liable with the Indemnitee (or would be if joined in such proceeding), the Company shall contribute to the amount of expenses and liabilities paid or payable by the Indemnitee in such proportion as is appropriate to reflect (a) the relative benefits received by the Company on the one hand and the Indemnitee on the other hand from the transaction from which such proceeding arose and (b) the relative fault of the Company on the one hand and of the Indemnitee on the other hand in connection with the events that resulted in such expenses, as well as any other relevant equitable considerations. The relative fault of the Company on the one hand and of the Indemnitee on the other hand shall be determined by reference to, among other things, the parties’ relative intent, knowledge, access to information, and opportunity to correct or prevent the circumstances resulting in such expenses, judgments, fines, or settlement amounts. The Company agrees that it would not be just and equitable if contribution pursuant to this Section 5 were determined by pro rata allocation or any other method of allocation which does not take account of the foregoing equitable considerations.

 

6. Mandatory Advancement of Expenses.

 

6.1 Advancement . Subject to Section 9 below, the Company shall pay as incurred and in advance of the final disposition of a civil or criminal proceeding all expenses incurred by the Indemnitee in connection with defending any such 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 the Indemnitee in any such capacity. The Indemnitee hereby undertakes to promptly repay such amounts advanced only if, and to the extent that, it shall ultimately by determined that the Indemnitee is not entitled to be indemnified by the Company under the provisions of this Agreement, the Articles of Incorporation or Bylaws of the Company, the Florida Revised Statutes, or otherwise. The advances to be made hereunder shall be paid by the Company to the Indemnitee within thirty (30) days following delivery of a written request therefor by the Indemnitee to the Company.

 

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6.2 Exception . Notwithstanding the foregoing provisions of this Section 6, the Company shall not be obligated to advance any expenses to the Indemnitee arising from a lawsuit filed directly by the Company against the Indemnitee if an absolute majority of the members of the Board reasonably determines in good faith, within thirty (30) days of the Indemnitee’s request to be advanced expenses, that the facts known to them at the time such determination is made demonstrate clearly and convincingly that the Indemnitee acted in bad faith. If such a determination is made, the Indemnitee may have such decision reviewed in the manner set forth in Section 8.5 hereof, with all references therein to “indemnification” being deemed to refer to “advancement of expenses,” and the burden of proof shall be on the Company to demonstrate clearly and convincingly that, based on the facts known at the time, the Indemnitee acted in bad faith. The Company may not avail itself of this Section 6.2 as to a given lawsuit if, at any time after the occurrence of the activities or omissions that are the primary focus of the lawsuit, the Company has undergone a change in control. For this purpose, a “change in control” shall mean a given person of group of affiliated persons or groups increasing their beneficial ownership interest in the Company by at least twenty (20) percentage points without advance Board approval.

 

7. Notice and Other Indemnification Procedures.

 

7.1 Notification . 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.

 

7.2 Insurance . If, at the time of the receipt of a notice of the commencement of a proceeding pursuant to Section 7.1 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 D&O Insurance policies.

 

7.3 Defense . In the event the Company shall be obligated to advance the expenses for any proceeding against the Indemnitee, the Company, if appropriate, shall be entitled to assume the defense of such proceeding, with counsel approved by the Indemnitee (which approval shall not be unreasonably withheld), upon the delivery to the Indemnitee of written notice of its election to do so. After delivery of such notice, approval of such counsel by the Indemnitee and the retention of such counsel by the Company, the Company will not be liable to the Indemnitee under this Agreement for any fees of counsel subsequently incurred by the Indemnitee with respect to the same proceeding, provided that (a) the Indemnitee shall have the right to employ the Indemnitee’s own counsel in any such proceeding at the Indemnitee’s expense; (b) the Indemnitee shall have the right to employ the Indemnitee’s own counsel in connection with any such proceeding, at the expense of the Company, if such counsel serves in a review, observer, advice, and counseling capacity and does not otherwise materially control or participate in the defense of such proceeding; and (c) if (i) the employment of counsel by the Indemnitee has been previously authorized by the Company, (ii) the Indemnitee shall have reasonably concluded that there may be conflict of interest between the Company and the Indemnitee in the conduct of any such defense, or (iii) the Company shall not, in fact, have employed counsel to assume the defense of such proceeding, then the fees and expenses of the Indemnitee’s counsel shall be at the expense of the Company.

 

8. Determination of Right to Indemnification .

 

8.1 Success on Merits . To the extent the Indemnitee has been successful on the merits or otherwise in defense of any proceeding referred to in Section 4.1 or 4.2 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 the Indemnitee in connection with the investigation, defense, or appeal of such proceeding, or such claim, issue, or matter, as the case may be.

 

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8.2 Proof by Company . In the event that Section 8.1 is inapplicable, or does not apply to the entire proceeding, the Company shall nonetheless indemnify the Indemnitee unless the Company shall prove by clear and convincing evidence to a forum listed in Section 8.4 below that the Indemnitee has not met the applicable standard of conduct required to entitle the Indemnitee to such indemnification.

 

8.3 Termination of Proceeding . The termination of any proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere its equivalent, does not, of itself, create a presumption that a person (a) did not act in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the Company, (b) with respect to any criminal action or proceeding, that the person had reasonable cause to believe that the person’s conduct was unlawful, or (c) the person’s act or failure to act constituted a breach of the person’s fiduciary duties as a director or an officer or the person’s breach of those duties involved intentional misconduct, fraud, or a knowing violation of law.

 

8.4 Applicable Forums . The Indemnitee shall be entitled to select the forum in which the validity of the Company’s claim under Section 8.2 hereof that the Indemnitee is not entitled to indemnification will be heard from among the following, except that the Indemnitee can select a forum consisting of the stockholders of the Company only with the approval of the Company and, if the Indemnitee is a director or an officer at the time of such determination, the determination shall be made in accordance with (a), (b), (c) or (d) below at the election of the Company:

 

(a) A majority vote of the directors who are not parties to the proceeding for which indemnification is being sought even though less than a quorum;

 

(b) By a committee of directors who are not parties to the proceeding for which indemnification is being sought designated by a majority vote of such directors, even though less than a quorum;

 

(c) If there are no directors who are not parties to the proceeding for which indemnification is sought, or if such directors so direct, by independent legal counsel in a written opinion;

 

(d) The stockholders of the Company;

 

(e) 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; or

 

(f) A court having jurisdiction of subject matter and the parties.

 

8.5 Submission . As soon as practicable, and in no event later than thirty (30) days after the forum has been selected pursuant to Section 8.4 above, the Company shall, at its own expense, submit to the selected forum 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.

 

8.6 Appeals . If the forum selected in accordance with Section 8.4 hereof is not a court, then after the final decision of such forum is rendered, the Company or the Indemnitee shall have the right to apply to a court of California, the court in which the proceeding giving rise to the Indemnitee’s claim for indemnification is or was pending, or any other court of competent jurisdiction, for the purpose of appealing the decision of such forum, provided that such right is executed within sixty (60) days after the final decision of such forum is rendered. If the forum selected in accordance with Section 8.4 hereof is a court, then the rights of the Company or the Indemnitee to appeal any decision of such court shall be governed by the applicable laws and rules governing appeals of the decision of such court.

 

8.7 Expenses for Interpretation . Notwithstanding any other provision in this Agreement to the contrary, 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.

 

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

 

9.1 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 specifically authorized by the Board or brought to establish or enforce a right to indemnification and/or advancement of expenses arising under this Agreement, the charter documents of the Company or any subsidiary, or any statute or law or otherwise, but such indemnification or advancement of expenses may be provided by the Company in specific cases if the Board finds it to be appropriate; or

 

9.2 Unauthorized Settlements . To indemnify the Indemnitee hereunder for any amounts paid in settlement of a proceeding unless the Company consents in advance in writing to such settlement, which consent shall not be unreasonably withheld; or

 

9.3 Securities Law Actions . To indemnify the Indemnitee on account of any suit in which judgment is rendered against the Indemnitee for an accounting of profits made from the purchase or sale by the Indemnitee of securities of the company pursuant to the provisions of Section 16(b) of the Securities Exchange Act of 1934 and amendments thereto or similar provisions of any federal, state, or local statutory law; or

 

9.4 Unlawful Indemnification . To indemnify the Indemnitee if a final decision by a court having jurisdiction in the mater shall determine that such indemnification is not lawful. In this respect, the Company and the Indemnitee have been advised that the Securities and Exchange Commission takes the position that indemnification for liabilities arising under the federal securities laws is against public policy and is, therefore, unenforceable and that claims for indemnification should be submitted to appropriate courts for adjudication.

 

10. Non-Exclusivity . The provisions for indemnification and advancement of expenses set forth in this Agreement shall not be deemed exclusive of any other rights that 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 action in the Indemnitee’s official capacity and to action in another capacity while occupying the Indemnitee’s 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.

 

11. General Provisions .

 

11.1 Interpretation of Agreement . It is understood that the parties hereto intend this Agreement to be interpreted and enforced so as to provide indemnification and advancement of expenses to the Indemnitee to the fullest extent now or hereafter permitted by law, except as expressly limited herein.

 

11.2 Severability . If any provision or provisions of this Agreement shall be held to be invalid, illegal, or unenforceable for any reason whatsoever, then: (a) the validity, legality, and enforceability of the remaining 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 not in any way be affected or impaired thereby; and (b) 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 11.1 hereof.

 

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11.3 Modification and Waiver . No supplement, modification, or amendment of this Agreement shall be binding unless executed in writing by 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.

 

11.4 Subrogation . In the event of full payment under this Agreement, the Company shall be subrogated to the extent of such payment to all of the rights of recovery of the Indemnitee, who shall execute all documents required and shall do all acts that may be necessary or desirable to secure such rights and to enable the Company effectively to bring suit to enforce such rights.

 

11.5 Counterparts . This Agreement may be executed in one or more counterparts, which shall together constitute one agreement.

 

11.6 Successors and Assigns. The terms of this Agreement shall bind, and shall inure to the benefit of, the successors and assigns of the parties hereto. The indemnification and advancement of expenses provided by, or granted pursuant to, this section shall, unless otherwise provided when authorized or ratified, continue as to a person who has ceased to be a director or an officer and shall inure to the benefit of the heirs, executors, and administrators of such a person.

 

11.7 Notice. All notices, requests, demands, and other communications under this Agreement shall be in writing and shall be deemed duly given if (a) delivered by hand and receipted for by the party addressee, or (b) 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.

 

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

 

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

 

11.10 Attorneys’ Fees. In the event Indemnitee is required to bring any action to enforce rights under this Agreement (including, without limitation, the expenses of any proceeding described in Section 4), the Indemnitee shall be entitled to all reasonable fees and expenses in bringing and pursuing such action, unless a court of competent jurisdiction finds each of the material claims of the Indemnitee in any such action was frivolous and not made in good faith.

 

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IN WITNESS WHEREOF , the parties hereto have entered into this Indemnification Agreement effective as of the date first written above.

 

GREATER CANNABIS COMPANY, INC.   INDEMNITEE:
       
By:               
       
Name:      
       
Title:      

 

     
 

 

SCHEDULE 1.05 Changes in Directors/Officers

 

Resignations

 

Officers:

 

1. Wayne Anderson – President, Chief Executive Officer, Chief Financial Officer, Treasurer and Secretary

 

Directors:

 

1. Wayne Anderson

 

Appointments

 

Directors:

 

1. Aitan Zacharin

 

Officers:

 

1. Aitan Zacharin

2. Mark Radom

 

     
 

 

Schedule 2.01(c) Company Capital Stock

 

Authorized:

 

Issued and outstanding:

 

2490585 Ontario Inc. – 100 Class A Common Shares

 

     
 

 

Schedule 2.01(m) Company Intellectual Property

 

     
 

 

Schedule 2.01(q) Company and Selling Shareholder Material Agreements

 

     
 

 

Schedule 4.02(h) Wayne Anderson Consulting Agreement

 

     
 

 

 

SERVICE AGREEMENT

 

THIS AGREEMENT made this 31st day of July 2018 (the “Effective Date”).

 

BETWEEN:  
  The Greater Cannabis Company, Inc. , a Florida corporation
  (the “ Company ”)
   
AND:  
  Aitan Zacharin, an individual residing in Baltimore, Maryland (the “Executive”)

 

A. The Company has offered the Executive the position of chief executive officer and director of the Company.

 

B. The Company and the Executive wish to formally record the terms and conditions upon which the Executive will be hired by and serve as chief executive officer of the Company.

 

C. Each of the Company and the Executive has agreed to the terms and conditions set forth in this Agreement, as evidenced by their respective execution hereof.

 

NOW THEREFORE THIS AGREEMENT WITNESSES that, in consideration of the premises and the mutual covenants and agreements herein contained, the parties hereto covenant and agree as follows:

 

A RTICLE 1

CONTRACT FOR SERVICES

 

1.1 Engagement the Executive as Chief Executive Officer. (a) The Company hereby agrees to hire the Executive as Chief Executive Officer in accordance with the terms and provisions hereof.

 

(i) Term. Unless terminated earlier in accordance with the provisions hereof, this Agreement will commence on the date of execution hereof (the “ Commencement Date ”) and will continue for a period of five (5) years from the Commencement Date (the “ Term ”).

 

(b) Service. The Executive agrees to faithfully, honestly and diligently serve the Company and to devote the time, attention efforts to further the business and legal interests of the Company and utilize his professional skills and care during the Term.

 

   
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1.2

Duties : The Executive’s services hereunder will be provided on the basis of the following terms and conditions:

 

(a) Reporting directly to the Board of Directors of the Company, the Executive will serve as the Chief Executive Officer of the Company;
     
(b) The Executive will be responsible for setting and managing the overall corporate direction for the Company, including establishing and maintaining budgets for the Company and ensuring that the Company has adequate capital for its operations, marketing and general corporate activities, all subject to any applicable law and to instructions provided by the Board of Directors of the Company from time to time;

 

The Executive will plan and direct the organization’s activities to achieve stated/agreed targets and standards for financial and trading performance, quality, culture and legislative adherence. He will recruit, select and develop executive team members and direct functions and performance via the executive team.

 

(c) The Executive will play a leading role in fundraising activities.
     
(d) The Executive will faithfully, honestly and diligently serve the Company and cooperate with the Company and utilize maximum professional skill and care to ensure that all services rendered hereunder are to the satisfaction of the Company, acting reasonably, and the Executive will provide any other services not specifically mentioned herein, but which by reason of the Executive’s capability, the Executive knows or ought to know to be necessary to ensure that the best interests of the Company are maintained.
     
(e) The Executive will assume, obey, implement and execute such duties, directions, responsibilities, procedures, policies and lawful orders as may be determined or given from time to time by the Company.
     
(f) The Executive will report the results of his duties hereunder to the Company as it may request from time to time.
     
(g) The Executive shall become a director of the Company on the date hereof. The Company’s board of directors shall take such action as is necessary to accomplish the foregoing on the date hereof.

 

COMPENSATION

 

1.3 Remuneration.

 

(a) The Executive shall receive the following cash compensation:

 

   
  3  

 

Base Salary. The Executive’s monthly base salary shall be ten thousand dollars ($10,000) (together with any increases thereto as hereinafter provided, the “Base Salary”). The Base Salary shall be payable in accordance with the Company’s normal payroll procedures in effect from time to time. The Base Salary may be increased by the Board from time to time during the Term, but shall be reviewed by the Board at least annually.

 

To the extent that the Company does not have sufficient funds to pay Executive his Base Salary, the Executive agrees that he shall receive $4,000 of such salary per month in cash and defer the remaining $6,000 (the “Deferral Amount”), which will be registered in the Company’s books as a loan given to the Company by the Executive. As and when the Company has additional funds from any source other than the Loan or any other loan made to the Company on the date hereof to pay Executive, the Company will pay as much of Executive’s Base Salary as possible. The Deferral Amount will be accumulated in the Company’s books as loan. The accumulated Deferral Amount will be repaid by the Company at such time when the Company begins making repayment of the loan made under the Kalfa Group Loan Agreement between the Company, Yonah Kalfa and Elisha Kalfa of even date herewith (the “Loan”). At such time when (i) the Company’s market capitalization reaches $7,000,000, (ii) the Company raises from investors no less than $1,500,000 or (iii) the Company repays the Loan, the Executive will have the option to convert the above mentioned accumulated debt, or part of it, into shares of the Company at the average trading price of the 10 days prior to the date of the request by the Executive to exercise this option. This option will survive the Term of this agreement. 

 

The Executive shall be eligible to participate in the employee benefit plans currently and hereafter maintained by the Company of general applicability to other senior executives of the Company, including, without limitation, the Company’s group medical, dental, vision, disability, life insurance, and flexible-spending account plans.

 

(b) In addition to the Fees, the Company will grant the Executive additional compensation in the form of cash or shares in cases of extraordinary contribution by him for the benefit of the Company as the Board of Directors of the Company may decide.

 

   
  4  

 

(c) The Executive’s position with the Company requires a special degree of personal trust, and the Company is not able to supervise the number of working hours of the Executive. Therefore the Executive will not be entitled to any additional remuneration whatsoever for his work with the exception of that specifically set out in this Agreement. The Executive has other business interests and, as such, shall be permitted to spend such time as the Executive deems necessary or expedient on such interests, so long as there is no adverse material impact on the Executive’s performance of his obligations hereunder.

 

1.4 Expenses. The Executive will be reimbursed by the Company for all reasonable business expenses incurred by the Executive in connection with his duties. This includes, but is not limited to, payments of expenses incurred when traveling abroad and others. In this connection, the Executive will be issued, as soon as practicable, a Company credit card that the Executive will use to pay for any and all expenses that pertain to the Company.

 

Article 2

Insurance and Benefits

 

2.1 Liability Insurance Indemnification . The Company will insure the Executive (including his heirs, executors and administrators) with coverage under a standard directors’ and officers’ liability insurance policy at the Company’s expense.

 

2.2 Vacation . The Executive shall be entitled to accrue paid vacation days in accordance with the Company’s vacation policy for senior executives, as established from time to time. The Executive shall also be entitled to all paid holidays given by the Company to its senior executives.

 

Article 3

CONFIDENTIALITY AND NON-COMPETITION

 

3.1 Maintenance of Confidential Information.

 

(a) The Executive acknowledges that, in the course of performing his obligations hereunder, the Executive will, either directly or indirectly, have access to and be entrusted with Confidential Information (whether oral, written or by inspection) relating to the Company or its respective affiliates, associates or customers.
     
(b) The Executive acknowledges that the Company’s Confidential Information constitutes a proprietary right, which the Company is entitled to protect. Accordingly, the Executive covenants and agrees that, as long as he works for the Company, the Executive will keep in strict confidence the Company’s Confidential Information and will not, without prior written consent of the Company, disclose, use or otherwise disseminate the Company’s Confidential Information, directly or indirectly, to any third party.

 

   
  5  

 

(c) The Executive agrees that, upon termination of his services for the Company, he will immediately surrender to the Company all Company Confidential Information then in his possession or under his control.

 

3.2 Exceptions. The general prohibition contained in Section 4.1 against the unauthorized disclosure, use or dissemination of the Company’s Confidential Information will not apply in respect of any Company Confidential Information that:

 

(a) is available to the public generally;
     
(b) becomes part of the public domain through no fault of the Executive;
     
(c) is already in the lawful possession of the Executive at the time of receipt of the Company’s Confidential Information; or
     
(d) is compelled by applicable law or regulation to be disclosed, provided that the Executive gives the Company prompt written notice of such requirement prior to such disclosure and provides commercially reasonable assistance at the request and expense of the Company, in obtaining an order protecting the Company’s Confidential Information from public disclosure.

 

Article 4

termination

 

4.1 Termination . The Executive’s employment may be terminated and this Agreement terminated under the following circumstances:

 

a) Death. The Executive’s employment hereunder shall terminate upon his death.

 

b) Disability. The Company may terminate the Executive’s employment if the Executive becomes subject to a Disability. For purposes of this Agreement, “Disability” means the Executive is unable to perform the essential functions of his position as Founder and Chairman Emeritus, with or without a reasonable accommodation, for a period of ninety (90) consecutive calendar days or one hundred eighty (180) non-consecutive calendar days within any rolling twelve (12) month period.

 

c) Termination by Company for Cause. The Company may terminate the Executive’s employment for Cause. For purposes of this Agreement, “Cause” means the Executive’s (i) commission of an act of material dishonesty by him in connection with his responsibilities as an officer, director or employee of the Company; (ii) willful failure to follow the directions communicated to him by the Board that are legal and consistent with his position and duties as Founder and Chairman Emeritus; (iii) breach of a fiduciary duty owed by the Executive to the Company or its shareholders; (iv) willful misconduct or gross misconduct which is materially detrimental to the Company; (v) conviction, plea of nolo contendere, guilty plea, or confession during the Term; to any felony or any crime based upon an act of fraud, misappropriation or embezzlement; or (vi) a material breach of this Agreement; provided, that, the bases set forth in (i), (ii), (iii), (iv) and (vi), to the extent curable, shall not constitute Cause unless the Company has provided the Executive with written notice of the acts or omissions giving rise to a termination of his employment for Cause and the Executive fails to correct the act or omission within thirty (30) days after receiving the Company’s notice (the “Executive Cure Period”).

 

   
  6  

 

d) Termination by the Company Without Cause. A termination of the Executive’s employment by the Company for any reason, except death, disability or Cause, will be deemed to be a termination “Without Cause.”

 

e) Termination by the Executive for Good Reason. The Executive may terminate his employment for “Good Reason.” For purposes of this Agreement, “Good Reason” means (i) without the Executive’s written consent, a material reduction of his duties, positions or responsibilities; (ii) without the Executive’s written consent, a significant reduction by the Company in Base Salary as in effect immediately prior to such reduction; or (iii) the Company’s material breach of this Agreement; provided that, within ninety (90) days of the Company’s act or omission giving rise to a resignation for Good Reason, the Executive notifies the Company in writing of the act or omission, the Company fails to correct the act or omission within thirty (30) days after receiving the Executive’s written notice (the “Company Cure Period”) and the Executive actually terminates his employment within sixty (60) days after the date the Company receives the Executive’s notice.

 

f) Termination by the Executive Without Good Reason. A resignation of the Executive’s employment for any reason other than Good Reason will be deemed to be a resignation “Without Good Reason.” The Executive may terminate his employment at any time Without Good Reason, upon thirty (30) days prior written notice to the Company, provided however, the Company may accelerate the date of such termination to any date following the receipt of such written notice.

 

g) Termination Date. The “Termination Date” means (i) if the Executive’s employment is terminated by his death under Section 4(a), the date of his death; (ii) if the Executive’s employment is terminated on account of his Disability under Section 4(b), the date on which the Company provides the Executive a written termination notice; (iii) if the Company terminates the Executive’s employment for Cause under Section 4(c), the date on which the Company provides the Executive a written termination notice, unless the circumstances giving rise to the termination are subject to the Executive Cure Period, in which case the date on which the Company provides the Executive a written termination notice following the end of the Executive Cure Period; (iv) if the Company terminates the Executive’s employment Without Cause under Section 4(d), thirty (30) days after the date on which the Company provides the Executive a written termination notice; (v) if the Executive resigns his employment for Good Reason under Section 4(e), the date on which the Executive provides the Company a written termination notice following the end of the Company Cure Period; or (vii) if the Executive resigns his employment Without Good Reason under Section 4(f), thirty (30) days after the date on which the Executive provides the Company a written termination notice.

 

   
  7  

 

4.2 Compensation Upon Termination .

 

a) Termination by the Company for Cause, upon the Executive’s Death or Disability or by the Executive Without Good Reason. If the Executive’s employment with the Company is terminated pursuant to Sections 4(a), (b), (c) or (f), the Company shall pay or provide to the Executive (or to his authorized representative or estate) (i) any earned but unpaid Base Salary as of the Termination Date; (ii) unpaid expense reimbursements as of the Termination Date; (iii) any earned but unpaid Bonus as of the Termination Date; and (iv) any vested benefits and equity incentives the Executive may have under any employee benefit plan of the Company and under Section 1 above (the “Accrued Obligations”), on or before the time required by law but in no event more than thirty (30) days after the Termination Date

 

b) Termination by the Company Without Cause or by the Executive With Good Reason. If the Executive’s employment is terminated by the Company Without Cause or the Executive terminates his employment for Good Reason, then the Executive shall be entitled to the following:

 

i) The Company shall pay the Executive the Accrued Obligations earned through the Termination Date (payable at the time provided for in Section 5(a)).
     
ii) The Company shall pay the Executive his Base Salary (less applicable withholding taxes) for 12 months thereafter, in accordance with the Company’s normal payroll practices in effect on the Termination Date and one hundred percent (100%) of the greater of the Executive’s Bonus for the year of termination or the Bonus actually earned for the year prior to the year of termination, if any; which amount will be paid within sixty (60) days of the later of the Termination Date or the calculation of such Bonus.

 

c) Subject to the Executive’s timely election of continuation coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”), the Company shall reimburse the Executive the monthly premium payable to continue his and his eligible dependents’ participation in the Company’s group health plan (to the extent permitted under applicable law and the terms of such plan) which covers the Executive (and the Executive’s eligible dependents) for the period that the Executive is eligible and remains eligible for COBRA coverage, provided, however, that in the event that the Executive obtains other employment that offers group health benefits, such continuation of coverage by the Company shall immediately cease.

 

   
  8  

 

d) Release; Payment. The payments and benefits provided for in Sections 4(b) shall be conditioned on the Executive executing and delivering to the Company a full release of all claims that the Executive may have against the Company, and its directors, officers, employees and agents in a form reasonably acceptable to the Company (the “Release”). The Release must become enforceable and irrevocable on or before sixtieth (60th) day following the Termination Date. If the Executive fails to execute and deliver the Release, he shall be entitled to the Accrued Obligations only and no other benefits under Section 4(b).

 

e) Section 409A Compliance. All in-kind benefits provided and expenses eligible for reimbursement under this Agreement shall be provided by the Company or incurred by the Executive during the time periods set forth in this Agreement. All reimbursements shall be paid as soon as administratively practicable, but in no event shall any reimbursement be paid after the last day of the taxable year following the taxable year in which the expense was incurred. The amount of in-kind benefits provided or reimbursable expenses incurred in one taxable year shall not affect the in-kind benefits to be provided or the expenses eligible for reimbursement in any other taxable year. Such right to reimbursement or in-kind benefits is not subject to liquidation or exchange for another benefit.

 

To the extent that any of the payments or benefits provided for in Section 4(b) are deemed to constitute non-qualified deferred compensation benefits subject to Section 409A of the United States Internal Revenue Code (the “Code”), the following interpretations apply to Section 4: Any termination of the Executive’s employment triggering payment of benefits under Section 4(b) must constitute a “separation from service” under Section 409A(a)(2)(A)(i) of the Code and Treas. Reg. §1.409A-1(h) before distribution of such benefits can commence. To the extent that the termination of the Executive’s employment does not constitute a separation of service under Section 409A(a)(2)(A)(i) of the Code and Treas. Reg. §1.409A-1(h) (as the result of further services that are reasonably anticipated to be provided by the Executive to the Company or any of its parents, subsidiaries or affiliates at the time the Executive’s employment terminates), any benefits payable under Section 4 that constitute deferred compensation under Section 409A of the Code shall be delayed until after the date of a subsequent event constituting a separation of service under Section 409A(a)(2)(A)(i) of the Code and Treas. Reg. §1.409A-1(h). For purposes of clarification, this Section 7(b) shall not cause any forfeiture of benefits on the Executive’s part, but shall only act as a delay until such time as a “separation from service” occurs. Further, if the Executive is a “specified employee” (as that term is used in Section 409A of the Code and regulations and other guidance issued thereunder) on the date his separation from service becomes effective, any benefits payable under Section 4 that constitute non-qualified deferred compensation under Section 409A of the Code shall be delayed until the earlier of (i) the business day following the six-month anniversary of the date his separation from service becomes effective, and (ii) the date of the Executive’s death, but only to the extent necessary to avoid such penalties under Section 409A of the Code. On the earlier of (i) the business day following the six-month anniversary of the date his separation from service becomes effective, and (ii) the Executive’s death, the Company shall pay the Executive in a lump sum the aggregate value of the non-qualified deferred compensation that the Company otherwise would have paid the Executive prior to that date under Section 4(b) of this Agreement. It is intended that each installment of the payments and benefits provided under Section 4(b) of this Agreement shall be treated as a separate “payment” for purposes of Section 409A of the Code. Neither the Company nor the Executive shall have the right to accelerate or defer the delivery of any such payments or benefits except to the extent specifically permitted or required by Section 409A of the Code.

 

   
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Article 5

Mutual Representations

 

5.1 The Executive represents and warrants to the Company that the execution and delivery of this Agreement and the fulfillment of the terms hereof

 

(a) will not constitute a default under or conflict with any agreement or other instrument to which he is a party or by which he is bound; and
     
(b) do not require the consent of any person or entity.

 

5.2 The Company represents and warrants to the Executive that this Agreement has been duly authorized, executed and delivered by the Company and that the fulfillment of the terms hereof

 

(a) will not constitute a default under or conflict with any agreement of other instrument to which it is a party or by which it is bound; and
     
(b) do not require the consent of any person of entity.

 

5.3 Each party hereto warrants and represents to the other that this Agreement constitutes the valid and binding obligation of such party enforceable against such party in accordance with its terms subject to applicable bankruptcy, insolvency, moratorium and similar laws affecting creditors’ rights generally, and subject, as to enforceability, to general principles of equity (regardless if enforcement is sought in proceeding in equity or at law).

 

Article 6

notices

 

6.1 Notices. All notices required or allowed to be given under this Agreement must be made either personally by delivery to or by facsimile transmission to the address as hereinafter set forth or to such other address as may be designated from time to time by such party in writing:

 

(a) in the case of the Company, to:

 

The Greater Cannabis Company, Inc.

 

To be provided under separate cover within three days after the date hereof.

 

   
  10  

 

(b) and in the case of the Executive, to the Executive’s last residence address known to the Company or aitanzacharin@gmail.com.

 

6.2 Change of Address. Any party may, from time to time, change its address for service hereunder by written notice to the other party in the manner aforesaid.

 

Article 7

GENERAL

 

7.1 Further Assurances. Each party hereto will promptly and duly execute and deliver to the other party such further documents and assurances and take such further action as such other party may from time to time reasonably request in order to more effectively carry out the intent and purpose of this Agreement and to establish and protect the rights and remedies created or intended to be created hereby.
   
7.2 Waiver. No provision hereof will be deemed waived and no breach excused, unless such waiver or consent excusing the breach is made in writing and signed by the party to be charged with such waiver or consent. A waiver by a party of any provision of this Agreement will not be construed as a waiver of a further breach of the same provision.

 

7.3 Amendments in Writing. No amendment, modification or rescission of this Agreement will be effective unless set forth in writing and signed by the parties hereto.
   
7.4 Assignment. Except as herein expressly provided, the respective rights and obligations of the Executive and the Company under this Agreement will not be assignable by either party without the written consent of the other party and will, subject to the foregoing, inure to the benefit of and be binding upon the Executive and the Company and their permitted successors or assigns. Nothing herein expressed or implied is intended to confer on any person other than the parties hereto any rights, remedies, obligations or liabilities under or by reason of this Agreement.
   
7.5 The Company acknowledges and agrees that the Executive may submit to the Company invoices from a company that employs him in lieu of invoices on his name. The Executive confirms that any such invoice will replace his own invoice and he agrees that his fees will be paid by the Company to third parties provided that it is done as per his instructions to the Company.
   
7.6 Severability. In the event that any provision contained in this Agreement is declared invalid, illegal or unenforceable by a court or other lawful authority of competent jurisdiction, such provision will be deemed not to affect or impair the validity or enforceability of any other provision of this Agreement, which will continue to have full force and effect.

 

   
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7.7 Headings. The headings in this Agreement are inserted for convenience of reference only and will not affect the construction or interpretation of this Agreement.
   
7.8 Number and Gender. Wherever the singular or masculine or neuter is used in this Agreement, the same will be construed as meaning the plural or feminine or a body politic or corporate and vice versa where the context so requires.
   
7.9 Time. Time is of the essence in this Agreement.
   
7.10 Successors. This Agreement shall inure to the benefit of and be enforceable by the Executive’s personal representatives, executors, administrators, heirs, distributees, devisees and legatees. In the event of the Executive’s death after his termination of employment but prior to the completion by the Company of all payments due him under this Agreement, the Company shall continue such payments to the Executive’s beneficiary designated in writing to the Company prior to his death (or to his estate, if the Executive fails to make such designation). The Company shall require any successor to the Company to expressly assume and agree to perform this Agreement in the same manner and to the same extent that the Company would be required to perform it if no such succession had taken place.
   
7.11 Governing Law. This Agreement will be construed and interpreted in accordance with the laws of the State of New York without reference to its conflicts of laws principles or the conflicts of laws principles of any other jurisdiction, and each of the parties hereto expressly attorns to the jurisdiction of the courts of the State of New York. The sole and exclusive place of jurisdiction in any matter arising out of or in connection with this Agreement will be the applicable New York state or federal court.
   
7.12 This Agreement (including all Annexes thereto) constitutes the entire agreement between the Parties with respect to the subject matter thereof and supersedes all prior agreements, understandings and negotiations, both written and oral, between the Parties with respect to this matter.

 

   
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement effective as of the date and year first above written.

 

The Greater Cannabis Company, Inc.  
   
/s/ Aitan Zacharin  
Name:  Aitan Zacharin  
Title: Chief Executive Officer and Director  

 

Agreed and accepted:  
   
Aitan Zacharin  
   
/s/ Aitan Zacharin  

 

   
   

 

SERVICE AGREEMENT

 

THIS AGREEMENT made this 31st day of July 2018 (the “Effective Date”).

 

BETWEEN:

 

The Greater Cannabis Company , a Florida company

(the “ Company ”)

 

AND:

 

Mark Radom, an individual residing in Bet Shemesh, Israel

(the “Executive”)

 

WHEREAS:

 

A. The Company has offered the Executive the position of chief legal officer of the Company.

 

B. The Company and the Executive wish to formally record the terms and conditions upon which the Executive will be hired by and serve as chief legal officer of the Company.

 

C. Each of the Company and the Executive has agreed to the terms and conditions set forth in this Agreement, as evidenced by their respective execution hereof.

 

NOW THEREFORE THIS AGREEMENT WITNESSES that, in consideration of the premises and the mutual covenants and agreements herein contained, the parties hereto covenant and agree as follows:

 

Article 1
CONTRACT FOR SERVICES

 

1.1 Engagement the Executive as Chief Legal Officer. (a) The Company hereby agrees to hire the Executive as Chief Legal Officer in accordance with the terms and provisions hereof.

 

  (i) Term. Unless terminated earlier in accordance with the provisions hereof, this Agreement will commence on the date of execution hereof (the “ Commencement Date ”) and will continue for a period of five (5) years from the Commencement Date (the “ Term ”).

 

  (b) Service. The Executive agrees to faithfully, honestly and diligently serve the Company and to devote the time, attention efforts to further the business and legal interests of the Company and utilize his professional skills and care during the Term.

 

 
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1.2 Duties : The Executive’s services hereunder will be provided on the basis of the following terms and conditions:
     
  (a) Reporting directly to the chief executive officer of the Company, the Executive will serve as the Chief Legal Officer of the Company;
     
  (b) The Executive will be responsible for setting and managing the legal matters and affairs of the Company and supervising, liaising and instructing outside counsel, in each case, subject to any applicable law and to instructions provided by the chief executive officer of the Company from time to time.
     
  (c) The Executive will faithfully, honestly and diligently serve the Company and cooperate with the Company and utilize maximum professional skill and care to ensure that all services rendered hereunder are to the satisfaction of the Company, acting reasonably, and the Executive will provide any other services not specifically mentioned herein, but which by reason of the Executive’s capability, the Executive knows or ought to know to be necessary to ensure that the best interests of the Company are maintained.
     
  (d) The Executive will assume, obey, implement and execute such duties, directions, responsibilities, procedures, policies and lawful orders as may be determined or given from time to time by the Company.
     
  (e) The Executive will report the results of his duties hereunder to the Company as it may request from time to time.

 

ARTICLE 2

COMPENSATION

 

1.3 Remuneration.
     
  (a) The Executive’s monthly base salary shall be seven thousand dollars ($7,000 (together with any increases thereto as hereinafter provided, the “Base Salary”). The Base Salary shall be payable in accordance with the Company’s normal payroll procedures in effect from time to time. The Base Salary may be increased by the Board from time to time during the Term, but shall be reviewed by the Board at least annually.

 

Starting in the second year of this Agreement, Executive’s monthly base salary shall be increased in accordance with industry standard compensation for chief legal officers so long as the Company has completed a capital raise of no less than $1,500,000.

 

ARTICLE 3

 

To the extent that the Company does not have sufficient funds to pay Executive his Base Salary, the Executive agrees that he shall receive $3,000 of such salary per month in cash and defer the remaining $4,000 (the “Deferral Amount”), which will be registered in the Company’s books as a loan given to the Company by the Executive. As and when the Company has additional funds from any source other than the Loan or any other loan made to the Company on the date hereof to pay Executive, the Company will pay as much of Executive’s Base Salary as possible. The Deferral Amount will be accumulated in the Company’s books as loan. The accumulated Deferral Amount will be repaid by the Company at such time when the Company begins making repayment of the loan made under the Kalfa Group Loan Agreement between the Company, Yonah Kalfa and Elisha Kalfa of even date herewith (the “Loan”). At such time when (i) the Company’s market capitalization reaches $7,000,000, (ii) the Company raises from investors no less than $1,500,000 or (iii) the Company repays the Loan, the Executive will have the option to convert the above mentioned accumulated debt, or part of it, into shares of the Company at the average trading price of the 10 days prior to the date of the request by the Executive to exercise this option. This option will survive the Term of this agreement.

 

 
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  (b) The Executive shall be eligible to participate in the employee benefit plans currently and hereafter maintained by the Company of general applicability to other senior executives of the Company, including, without limitation, the Company’s group medical, dental, vision, disability, life insurance, and flexible-spending account plans.
     
  (c) In addition to the Fees, the Company will grant the Executive additional compensation in the form of cash or shares in cases of extraordinary contribution by him to the benefit of the Company as the Board of Directors of the Company will decide.
     
  (d) The Executive’s position with the Company requires a special degree of personal trust, and the Company is not able to supervise the number of working hours of the Executive. Therefore, the Executive will not be entitled to any additional remuneration whatsoever for his work with the exception of that specifically set out in this Agreement. The Executive has other business interests and, as such, shall be permitted to spend such time as the Executive deems necessary or expedient on such interests, so long as there is no adverse material impact on the Executive’s performance of his obligations hereunder.

 

3.2 Incentive Plans. The Executive will be entitled to participate in any bonus plan or incentive compensation plans for its employees, adopted by the Company.
   
3.3 Expenses. The Executive will be reimbursed by the Company for all reasonable business expenses incurred by the Executive in connection with his duties. This includes, but is not limited to, payments of expenses incurred when traveling abroad and others. In this connection, the Executive will be issued, as soon as practicable, a Company credit card that the Executive will use to pay for any and all expenses that pertain to the Company.

 

Article 4
Insurance and Benefits

 

4.1 Liability Insurance Indemnification . The Company will insure the Executive (including his heirs, executors and administrators) with coverage under a standard directors’ and officers’ liability insurance policy at the Company’s expense.

 

 
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Article 5
CONFIDENTIALITY AND NON-COMPETITION

 

5.1 Maintenance of Confidential Information.
     
  (a) The Executive acknowledges that, in the course of performing his obligations hereunder, the Executive will, either directly or indirectly, have access to and be entrusted with Confidential Information (whether oral, written or by inspection) relating to the Company or its respective affiliates, associates or customers.
     
  (b) The Executive acknowledges that the Company’s Confidential Information constitutes a proprietary right, which the Company is entitled to protect. Accordingly, the Executive covenants and agrees that, as long as he works for the Company, the Executive will keep in strict confidence the Company’s Confidential Information and will not, without prior written consent of the Company, disclose, use or otherwise disseminate the Company’s Confidential Information, directly or indirectly, to any third party.
     
  (c) The Executive agrees that, upon termination of his services for the Company, he will immediately surrender to the Company all Company Confidential Information then in his possession or under his control.
     
5.2 Exceptions. The general prohibition contained in Section 4.1 against the unauthorized disclosure, use or dissemination of the Company’s Confidential Information will not apply in respect of any Company Confidential Information that:
     
  (a) is available to the public generally;
     
  (b) becomes part of the public domain through no fault of the Executive;
     
  (c) is already in the lawful possession of the Executive at the time of receipt of the Company’s Confidential Information; or
     
  (d) is compelled by applicable law or regulation to be disclosed, provided that the Executive gives the Company prompt written notice of such requirement prior to such disclosure and provides commercially reasonable assistance at the request and expense of the Company, in obtaining an order protecting the Company’s Confidential Information from public disclosure.

 

 
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Article 6
termination

 

6.1 Termination of Employment . The Executive’s employment may be terminated only as follows:
       
  (a) Termination by the Company
       
    (i) For Cause. The Company may terminate the Executive’s employment for Cause.
       
    (ii) Without Cause. The Company may terminate Executive’s employment at any time by giving Executive 60 days prior written Notice of the termination. In such case, 100% of the Executive’s unvested stock and option compensation in Section 1.3(b) will vest without any further action required on the part of the Executive or the Company and the Company will deliver to the order of the Executive promptly upon receipt of a written demand of the Executive such shares of common stock or options at its sole expense as become due to Executive pursuant to Section 1.3(b). The Executive’s right to receive compensation whether in cash or securities shall survive any termination of this Agreement Without Cause.
       
  (b) Termination by the Executive
       
    (i) For Good Reason. The Executive may terminate the Executive’s employment with the Company for Good Reason.
       
    (ii) Without Good Reason. The Executive may voluntarily terminate the Executive’s employment with the Company at any time by giving the Company 120 days prior written Notice of the termination.
       
  (c) Termination Upon Death or Disability
       
    (i) Death. The Executive’s employment shall terminate upon the Executive’s death.
       
    (ii) Disability. The Company may terminate the Executive’s employment upon the Executive’s Disability.
       
  (d) For the purpose of this Article 4, “Cause” means:
       
    (i) Breach of Agreement. Executive’s material breach of Executive’s obligations of this Agreement, not cured after 30 days’ Notice from the Company.
       
    (ii) Gross Negligence. Executive’s gross negligence in the performance of Executive’s duties.
       
    (iii) Crimes and Dishonesty. Executive’s conviction of or plea guilty to any crime involving, dishonesty, fraud or moral turpitude.
       
    (iv) In the event of termination of this agreement for Cause, the Company may terminate the Executive’s employment after 30 days’ Notice.

 

 
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  (e) For the purpose of this Article 4, “Good Reason” means:
       
    (i) Breach of Agreement. The Company’s material breach of this Agreement, which breach has not been cured by the Company within 30 days after receipt of written notice specifying, in reasonable detail, the nature of such breach or failure from Executive.
       
    (ii) Non Payment. The failure of the Company to pay any amount due to Executive hereunder, which failure persists for 30 days after written notice of such failure has been received by the Company.
       
    (iii) Change of Responsibilities/Compensation. Any material reduction in Executive’s title or a material reduction in Executive’s duties or responsibilities or any material adverse change in Executive’s Base Salary or any material adverse change in Executive’s benefits.
       
    (iv) Change of Location. Any relocation of the premises at which Executive works to a location more than 20 kilometers from such location, without Executive’s consent.

 

ARTICLE 7

 

It is agreed that, in the event of termination of this agreement if the Company decides that the Executive’s services are not needed during the of termination period, Company will continue to be responsible for paying cash and equity compensation as defined in Article 2 of this Agreement for the entire termination period. Neither the Company, nor the Executive will be entitled to any notice, or payment in excess of that specified in this Article 5.

 

Article 8
Mutual Representations

 

8.1 The Executive represents and warrants to the Company that the execution and delivery of this Agreement and the fulfillment of the terms hereof
     
  (a) will not constitute a default under or conflict with any agreement or other instrument to which he is a party or by which he is bound; and
     
  (b) do not require the consent of any person or entity.
     
8.2 The Company represents and warrants to the Executive that this Agreement has been duly authorized, executed and delivered by the Company and that the fulfillment of the terms hereof
     
  (a) will not constitute a default under or conflict with any agreement of other instrument to which it is a party or by which it is bound; and
     
  (b) do not require the consent of any person of entity.
     
8.3 Each party hereto warrants and represents to the other that this Agreement constitutes the valid and binding obligation of such party enforceable against such party in accordance with its terms subject to applicable bankruptcy, insolvency, moratorium and similar laws affecting creditors’ rights generally, and subject, as to enforceability, to general principles of equity (regardless if enforcement is sought in proceeding in equity or at law).

 

 
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Article 9
notices

 

9 .1 Notices. All notices required or allowed to be given under this Agreement must be made either personally by delivery to or by facsimile transmission to the address as hereinafter set forth or to such other address as may be designated from time to time by such party in writing:
     
  (a) in the case of the Company, to:

 

The Greater Cannabis Company, Inc.

 

To be provided under separate cover within three days after the date hereof; in the event that Executive does not receive notice of address within such period, then Executive shall be entitled to send any notice to any email address of Aitan Zacharin known to Executive and the sending of any such notice shall constitute receipt of notice whether Aitan Zacharin or the Company receives such notice or not.

 

  (b) and in the case of the Executive, to the Executive’s last residence address known to the Company or mfradom@gmail.com.
     
9 .2 Change of Address. Any party may, from time to time, change its address for service hereunder by written notice to the other party in the manner aforesaid.

 

Article 10
GENERAL

 

10 .1 Further Assurances. Each party hereto will promptly and duly execute and deliver to the other party such further documents and assurances and take such further action as such other party may from time to time reasonably request in order to more effectively carry out the intent and purpose of this Agreement and to establish and protect the rights and remedies created or intended to be created hereby.
   
10 .2 Waiver. No provision hereof will be deemed waived and no breach excused, unless such waiver or consent excusing the breach is made in writing and signed by the party to be charged with such waiver or consent. A waiver by a party of any provision of this Agreement will not be construed as a waiver of a further breach of the same provision.

 

 
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10. 3 Amendments in Writing. No amendment, modification or rescission of this Agreement will be effective unless set forth in writing and signed by the parties hereto.
   
10 .4 Assignment. Except as herein expressly provided, the respective rights and obligations of the Executive and the Company under this Agreement will not be assignable by either party without the written consent of the other party and will, subject to the foregoing, inure to the benefit of and be binding upon the Executive and the Company and their permitted successors or assigns. Nothing herein expressed or implied is intended to confer on any person other than the parties hereto any rights, remedies, obligations or liabilities under or by reason of this Agreement.
   
10 .5 The Company acknowledges and agrees that the Executive may submit to the Company invoices from a company that employs him in lieu of invoices on his name. The Executive confirms that any such invoice will replace his own invoice and he agrees that his fees will be paid by the Company to third parties provided that it is done as per his instructions to the Company.
   
10 .6 Severability. In the event that any provision contained in this Agreement is declared invalid, illegal or unenforceable by a court or other lawful authority of competent jurisdiction, such provision will be deemed not to affect or impair the validity or enforceability of any other provision of this Agreement, which will continue to have full force and effect.
   
10 .7 Headings. The headings in this Agreement are inserted for convenience of reference only and will not affect the construction or interpretation of this Agreement.
   
10 .8 Number and Gender. Wherever the singular or masculine or neuter is used in this Agreement, the same will be construed as meaning the plural or feminine or a body politic or corporate and vice versa where the context so requires.
   
10 .9 Time. Time is of the essence in this Agreement.
   
10 .10 Governing Law. This Agreement will be construed and interpreted in accordance with the laws of the State of New York without reference to its conflicts of laws principles or the conflicts of laws principles of any other jurisdiction, and each of the parties hereto expressly attorns to the jurisdiction of the courts of the State of New York. The sole and exclusive place of jurisdiction in any matter arising out of or in connection with this Agreement will be the applicable New York state or federal court.
   
10 .11 This Agreement (including all Annexes thereto) constitutes the entire agreement between the Parties with respect to the subject matter thereof and supersedes all prior agreements, understandings and negotiations, both written and oral, between the Parties with respect to this matter.

 

 
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement effective as of the date and year first above written.

 

The Greater Cannabis Company, Inc.  
     
/s/ Aitan Zacharin  
Name: Aitan Zacharin  
Title: Chief Executive Officer and Director  
     
Agreed and accepted:  
     
Mark Radom  
   
/s/ Mark Radom  

 

 
 

 

 

DEBT FORGIVENESS, RELEASE AND SETTLEMENT AGREEMENT

 

This debt forgiveness, release and settlement agreement (this “Agreement”) is entered into this 31st day of July 2018 by and between The Greater Cannabis Company, Inc., a corporation organized under the laws of Florida (“GCAN”), and Jimmy Wayne Anderson, an individual residing in the State of Florida (“Wayne”).

 

W I T N E S S E T H:

 

WHEREAS, Wayne has served as (i) chief executive officer of GCAN from its inception to-date without any written agreement in respect thereof and (ii) director of GCAN pursuant to a director service agreement dated March 10, 2017 (the “Director Service Agreement”); and

 

WHEREAS, although there were no arrangements in place for Wayne to receive any compensation whether consisting of salary or shares for his service as chief executive officer of GCAN, there were such arrangements in place in respect of his service as director of GCAN; and

 

WHEREAS, Wayne wants to forgive the salary and shares owed to him under the Director Service Agreement and release GCAN from any and all claims he may have against GCAN and GCAN wants to release Wayne from any and all claims it may have against him, in each case, on the terms and subject to the conditions of this Agreement;

 

NOW, THEREFORE, in consideration of the foregoing and the mutual covenants set forth herein, the parties agree as follows:

 

1. Debt Forgiveness . Wayne hereby forgives and waives any right he has to receive any unpaid salary or compensation and any shares, options or other securities that vested in him or which he was entitled to receive under the Director Service Agreement, in respect of his service as GCAN’s chief executive officer or otherwise. For the avoidance of doubt, it is agreed that GCAN does not owe Wayne any compensation or securities of any nature whatsoever.

 

2. Release . (a) Wayne on his own behalf and on behalf of his successors and assigns, hereby releases and discharges GCAN, its subsidiaries and other affiliated entities, and its and their insurers, predecessors, successors, assigns, officers, directors, shareholders, employees and agents (hereinafter collectively, the “GCAN Group”) from any and all claims, obligations and liabilities which Wayne now or in the future might assert, arising out of or relating to anything that happened prior to the date of this Agreement, including but not limited to his employment by or service as director of GCAN. Wayne waives and agrees not to assert or pursue by an means whatsoever any claim or right to assert any claim it may have against GCAN for any action taken or omitted to be taken by GCAN, including, but not limited to, the payment or non-payment of any cash or share-based compensation, while serving as an officer or director of GCAN.

 

(b) The GCAN Group on its behalf and on behalf of its subsidiaries and other affiliated entities, and its and their insurers, predecessors, successors, assigns, officers, directors, shareholders, employees and agents, hereby releases and discharges Wayne and his insurers, predecessors, successors, assigns and agents from any and all claims, obligations and liabilities which Wayne now or in the future might assert, arising out of or relating to anything that happened prior to the date of this Agreement, including but not limited to his employment by or his service as a director of GCAN. The GCAN Group waives and agrees not to assert or pursue by an means whatsoever any claim or right to assert any claim it may have against Wayne for any action taken or omitted to be taken by Wayne while serving as an officer or director of GCAN.

 

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3. Confidentiality . Each party agrees to maintain this Agreement and its terms and conditions in confidentiality except to the extent that either party is required to make a disclosure under applicable law or regulation.

 

4. Anti-Dilution . GCAN agrees that the 2,109,023 shares of common stock of the GCAN held by Wayne as at the date hereof, which represents a 0.42% ownership stake in GCAN (based on there being 500,000,000 shares of common stock (or shares convertible into common stock) authorized and outstanding) shall be subject to anti-dilution protection such that on the date that is 14 months from the hereof, Wayne shall receive that number of additional shares of common stock of GCAN as shall be required for Wayne to have a 0.42% ownership stake in GCAN on such date (assuming that all shares into which any options, warrants or other securities convertible into common shares were converted, issued and/or outstanding).

 

5. Enforcement . In the event that any entity or natural person comprising the GCAN Group or Wayne is required, or chooses, to enforce the terms of this Agreement in litigation, whether as plaintiff or defendant, the other party, to the extent and only to the extent that such other party is held to be liable, shall reimburse and indemnify said entity or person for its/his/her actual costs incurred in such enforcement, including but not limited to the fees of its/his/her attorneys at the actual hourly rate(s) customarily charged thereby for similar services.

 

6. Selection of Forum; Submission to Jurisdiction . Any action arising out of or relating to this Agreement shall be determined exclusively by the state or federal courts situated in the State of New York. The parties consent to in personam jurisdiction and to venue exclusively in said courts; and each party hereby appoints the Secretary of State of New York as its agent for service of process in New York.

 

7. Further Assurances . Each party hereto agrees to execute, on request, all other documents and instruments as the other party shall reasonably request, and to take any actions, which are reasonably required or desirable to carry out obligations imposed under, and affect the purposes of, this Agreement.

 

8. Entire Agreement . This Agreement constitutes the entire agreement between the parties, superseding all prior oral or written negotiations, representations, understandings and agreements, on the subject matter hereof; and there are no conditions to this Agreement, which are not expressed herein.

 

9. Resignation . Wayne hereby resigns from all positions he has in or with GCAN, including director and chairman of the board, president, chief executive officer, chief financial officer, treasurer and secretary. Wayne furthermore hereby waives his right to make any statement on the current report on Form 8-K that GCAN will file in connection with the transactions contemplated hereby.

 

10. Governing Law . This Agreement shall be governed by and construed in accordance with the laws, other than the principles of conflicts of laws, of the State of New York.

 

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IN WITNESS WHEREOF, the parties have executed this Agreement in person or by their undersigned, duly authorized agents.

 

  The Greater Cannabis Company, Inc.
     
  By: /s/ Aitan Zacharin
  Title:  Authorized Signatory
     
  /s/ Jimmy Wayne Anderson
  Jimmy Wayne Anderson

 

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INDEMNIFICATION AGREEMENT

 

This Indemnification Agreement (this “Agreement”), dated as of July 31, 2018, is made by and between Greater Cannabis Company, Inc., a Florida corporation (the “Company”), and the undersigned, who is either a director or an officer (or both) of the Company (the “Indemnitee”), with this Agreement to be deemed effective as of the date that the Indemnitee first assumed either such capacity at the Company.

 

RECITALS

 

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

 

B. The Board of Directors of the Company (the “Board”) has concluded that, to retain and attract talented and experienced individuals to serve as officers or directors of the Company, it is necessary for the Company contractually to indemnify certain of such persons and to assume for itself maximum liability for expenses and damages in connection with claims against such persons in connection with their service to the Company;

 

C. Section 607.0850 (1) of Chapter 607 of the Florida Business Corporation Act, under which the Company is organized (“Section 607.0850”), empowers the Company to indemnify by agreement its present and former officers and directors and persons who serve, at the request of the Company, as directors or officers of other corporations, partnerships, joint ventures, trusts, or other enterprises and expressly provides that the indemnification provided by Section 607.0850 is not exclusive; and

 

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

 

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

 

1. Definitions

 

1.1 Agent . For the purposes of this Agreement, “agent” of the Company means any person who is or was a director or an officer of the Company or a subsidiary of the Company; or is or was serving at the request of the Company or a subsidiary of the Company as a director or an officer of another foreign or domestic corporation, partnership, joint venture, trust, or other enterprise or an affiliate of the Company. The term “enterprise” includes any employee benefit plan of the Company, its subsidiaries, affiliates, and predecessor corporations.

 

1.2 Company . For purposes of this Agreement, the “Company” includes, in addition to the resulting corporation, any constituent corporation (including any constituent of a constituent) absorbed in a consolidation or merger that, if its separate existence had continued, would have had power and authority to indemnify its directors or officers so that any person who is or was a director or an officer of such constituent corporation, or is or was serving at the request of such constituent corporation as a director or an officer of another corporation, partnership, joint venture, trust, or other enterprise, shall stand in the same position under this Agreement with respect to the resulting or surviving corporation as such person would have with respect to such constituent corporation if its separate existence had continued.

 

1.3 Expenses . For the 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 the investigation, defense, or appeal of a proceeding or establishing or enforcing a right to indemnification or advancement of expenses under this Agreement, Section [] or otherwise; provided , however , that expenses shall not include any judgments, fines, ERISA excise taxes or penalties, or amounts paid in settlement of a proceeding.

 

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1.4 Fines . For purposes of this Agreement, references to “fines” includes any excise taxes assessed on a person with respect to any employee benefit plan.

 

1.5 Liabilities . For purposes of this Agreement, “liabilities” means judgments, fines, ERISA execute taxes or penalties, and amounts paid in settlement in connection with a proceeding.

 

1.6 Other Enterprises . For purposes of this Agreement, “other enterprises” includes employee benefit plans.

 

1.7 Proceeding . For the purposes of this Agreement, “proceeding” means any threatened, pending, or completed action, suit, or other proceeding, whether civil, criminal, administrative, or investigative.

 

1.8 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 of its subsidiaries, or by one or more of the Company’s subsidiaries.

 

1.9 Serving at the Request of the Company . For purposes of this Agreement, “serving at the request of the Company” includes any service as a director or an officer of the Company that imposes duties on, or involves services by, such director or officer with respect to an employee benefit plan, its participants or beneficiaries; and a person who acted in good faith and in a manner such person reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan shall be deemed to have acted in a manner “not opposed to the best interests of the Company” as referred to in this Agreement.

 

2. Agreement to Serve . The Indemnitee agrees to serve and/or continue to serve as an agent of the Company, at the will of the Company (or under separate agreement, if such agreement exists), in the capacity the Indemnitee currently serves as an agent of the Company, faithfully and to the best of his ability, so long as he is duly appointed or elected and qualified in accordance with the applicable provisions of the charter documents of the Company or any subsidiary of the Company; provided , however , that the Indemnitee may at any time and for any reason resign from such position (subject to any contractual obligation that the Indemnitee may have assumed apart from this Agreement), and the Company and any subsidiary shall have no obligation under this Agreement to continue the Indemnitee in any such position.

 

3. Directors’ and Officers’ Insurance . The Company shall, to the extent that the Board determines it to be economically reasonable, maintain a policy of directors’ and officers’ liability insurance (“D&O Insurance”), on such terms and conditions as may be approved by the Board.

 

4. Mandatory Indemnification . Subject to Section 9 below, the Company hereby agrees to hold harmless and indemnify the Indemnitee to the fullest extent permitted by law, as such may be amended from time to time. In furtherance of the foregoing indemnification, and without limiting the generality thereof:

 

4.1 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 (except an action by or in the right of the Company) 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 the Indemnitee in any such capacity, against any and all expenses and liabilities of any type whatsoever incurred by the Indemnitee in connection with such proceeding if (a) the Indemnitee acted in good faith and in a manner the Indemnitee 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 the Indemnitee’s conduct was unlawful, or (b) the Indemnitee, if a director or an officer of the Company, did not act or fail to act in a manner that constituted a breach of the Indemnitee’s fiduciary duties as a director or an officer or such Indemnitee’s breach of those duties did not involve intentional misconduct, fraud, or a knowing violation of law; and

 

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4.2 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 the Indemnitee is or was an agent of the Company, or by reason of anything done or not done by the Indemnitee in any such capacity, against any and all expenses and liabilities incurred by the Indemnitee in connection with such proceeding if (a) the Indemnitee acted in good faith and in a manner the Indemnitee reasonably believed to be in, or not opposed to, the best interests of the Company, or (b) the Indemnitee, if a director or an officer of the Company, did not act or fail to act in a manner that constituted a breach of the Indemnitee’s fiduciary duties as a director or an officer or such Indemnitee breach of those duties involved intentional misconduct, fraud, or a knowing violation of law; except that no indemnification under this subsection shall be made in respect of any claim, issue, or matter as to which the Indemnitee shall have been adjudged by a court of competent jurisdiction, after the exhaustion of all appeals therefrom, to be liable to the Company or for amounts paid in settlement to the Company, unless and only to the extent that the court in which such proceeding was brought or another court of competent jurisdiction determines upon application that, in view of all the circumstances of the case, the Indemnitee is fairly and reasonable entitled to indemnity for such expenses as the court deems proper; and

 

4.3 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, fines, ERISA excise taxes or penalties, and amounts paid in settlement) to the extent such have been paid to the Indemnitee by D&O Insurance.

 

4.4 Indemnification for Expenses as a Witness . Notwithstanding any other provision of this Agreement, to the extent that Indemnitee is, by reason of the Indemnitee’s status as an agent of the Company, a witness, or is made (or asked) to respond to discovery requests, in any proceeding to which Indemnitee is not a party, the Indemnitee shall be indemnified against all expenses and liabilities of any type whatsoever actually and reasonably incurred by him or her or on his or her behalf in connection therewith.

 

5. Partial Indemnification and Contribution .

 

5.1 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 incurred by the Indemnitee in connection with a proceeding but is not entitled, however, to indemnification for all of the total amount thereof, then the Company shall nevertheless indemnify the Indemnitee for such total amount except as to the portion thereof to which the Indemnitee is not entitled to indemnification.

 

5.2 Contribution . If the Indemnitee is not entitled to the indemnification provided in Section 4 for any reason other than the statutory limitations set forth in the Florida Revised Statutes, then in respect of proceeding in which the Company is jointly liable with the Indemnitee (or would be if joined in such proceeding), the Company shall contribute to the amount of expenses and liabilities paid or payable by the Indemnitee in such proportion as is appropriate to reflect (a) the relative benefits received by the Company on the one hand and the Indemnitee on the other hand from the transaction from which such proceeding arose and (b) the relative fault of the Company on the one hand and of the Indemnitee on the other hand in connection with the events that resulted in such expenses, as well as any other relevant equitable considerations. The relative fault of the Company on the one hand and of the Indemnitee on the other hand shall be determined by reference to, among other things, the parties’ relative intent, knowledge, access to information, and opportunity to correct or prevent the circumstances resulting in such expenses, judgments, fines, or settlement amounts. The Company agrees that it would not be just and equitable if contribution pursuant to this Section 5 were determined by pro rata allocation or any other method of allocation which does not take account of the foregoing equitable considerations.

 

6. Mandatory Advancement of Expenses .

 

6.1 Advancement . Subject to Section 9 below, the Company shall pay as incurred and in advance of the final disposition of a civil or criminal proceeding all expenses incurred by the Indemnitee in connection with defending any such 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 the Indemnitee in any such capacity. The Indemnitee hereby undertakes to promptly repay such amounts advanced only if, and to the extent that, it shall ultimately by determined that the Indemnitee is not entitled to be indemnified by the Company under the provisions of this Agreement, the Articles of Incorporation or Bylaws of the Company, the Florida Revised Statutes, or otherwise. The advances to be made hereunder shall be paid by the Company to the Indemnitee within thirty (30) days following delivery of a written request therefor by the Indemnitee to the Company.

 

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6.2 Exception . Notwithstanding the foregoing provisions of this Section 6, the Company shall not be obligated to advance any expenses to the Indemnitee arising from a lawsuit filed directly by the Company against the Indemnitee if an absolute majority of the members of the Board reasonably determines in good faith, within thirty (30) days of the Indemnitee’s request to be advanced expenses, that the facts known to them at the time such determination is made demonstrate clearly and convincingly that the Indemnitee acted in bad faith. If such a determination is made, the Indemnitee may have such decision reviewed in the manner set forth in Section 8.5 hereof, with all references therein to “indemnification” being deemed to refer to “advancement of expenses,” and the burden of proof shall be on the Company to demonstrate clearly and convincingly that, based on the facts known at the time, the Indemnitee acted in bad faith. The Company may not avail itself of this Section 6.2 as to a given lawsuit if, at any time after the occurrence of the activities or omissions that are the primary focus of the lawsuit, the Company has undergone a change in control. For this purpose, a “change in control” shall mean a given person of group of affiliated persons or groups increasing their beneficial ownership interest in the Company by at least twenty (20) percentage points without advance Board approval.

 

7. Notice and Other Indemnification Procedures .

 

7.1 Notification . 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.

 

7.2 Insurance . If, at the time of the receipt of a notice of the commencement of a proceeding pursuant to Section 7.1 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 D&O Insurance policies.

 

7.3 Defense . In the event the Company shall be obligated to advance the expenses for any proceeding against the Indemnitee, the Company, if appropriate, shall be entitled to assume the defense of such proceeding, with counsel approved by the Indemnitee (which approval shall not be unreasonably withheld), upon the delivery to the Indemnitee of written notice of its election to do so. After delivery of such notice, approval of such counsel by the Indemnitee and the retention of such counsel by the Company, the Company will not be liable to the Indemnitee under this Agreement for any fees of counsel subsequently incurred by the Indemnitee with respect to the same proceeding, provided that (a) the Indemnitee shall have the right to employ the Indemnitee’s own counsel in any such proceeding at the Indemnitee’s expense; (b) the Indemnitee shall have the right to employ the Indemnitee’s own counsel in connection with any such proceeding, at the expense of the Company, if such counsel serves in a review, observer, advice, and counseling capacity and does not otherwise materially control or participate in the defense of such proceeding; and (c) if (i) the employment of counsel by the Indemnitee has been previously authorized by the Company, (ii) the Indemnitee shall have reasonably concluded that there may be conflict of interest between the Company and the Indemnitee in the conduct of any such defense, or (iii) the Company shall not, in fact, have employed counsel to assume the defense of such proceeding, then the fees and expenses of the Indemnitee’s counsel shall be at the expense of the Company.

 

8. Determination of Right to Indemnification .

 

8.1 Success on Merits . To the extent the Indemnitee has been successful on the merits or otherwise in defense of any proceeding referred to in Section 4.1 or 4.2 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 the Indemnitee in connection with the investigation, defense, or appeal of such proceeding, or such claim, issue, or matter, as the case may be.

 

8.2 Proof by Company . In the event that Section 8.1 is inapplicable, or does not apply to the entire proceeding, the Company shall nonetheless indemnify the Indemnitee unless the Company shall prove by clear and convincing evidence to a forum listed in Section 8.4 below that the Indemnitee has not met the applicable standard of conduct required to entitle the Indemnitee to such indemnification.

 

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8.3 Termination of Proceeding . The termination of any proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere its equivalent, does not, of itself, create a presumption that a person (a) did not act in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the Company, (b) with respect to any criminal action or proceeding, that the person had reasonable cause to believe that the person’s conduct was unlawful, or (c) the person’s act or failure to act constituted a breach of the person’s fiduciary duties as a director or an officer or the person’s breach of those duties involved intentional misconduct, fraud, or a knowing violation of law.

 

8.4 Applicable Forums . The Indemnitee shall be entitled to select the forum in which the validity of the Company’s claim under Section 8.2 hereof that the Indemnitee is not entitled to indemnification will be heard from among the following, except that the Indemnitee can select a forum consisting of the stockholders of the Company only with the approval of the Company and, if the Indemnitee is a director or an officer at the time of such determination, the determination shall be made in accordance with (a), (b), (c) or (d) below at the election of the Company:

 

(a) A majority vote of the directors who are not parties to the proceeding for which indemnification is being sought even though less than a quorum;

 

(b) By a committee of directors who are not parties to the proceeding for which indemnification is being sought designated by a majority vote of such directors, even though less than a quorum;

 

(c) If there are no directors who are not parties to the proceeding for which indemnification is sought, or if such directors so direct, by independent legal counsel in a written opinion;

 

(d) The stockholders of the Company;

 

(e) 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; or

 

(f) A court having jurisdiction of subject matter and the parties.

 

8.5 Submission . As soon as practicable, and in no event later than thirty (30) days after the forum has been selected pursuant to Section 8.4 above, the Company shall, at its own expense, submit to the selected forum 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.

 

8.6 Appeals . If the forum selected in accordance with Section 8.4 hereof is not a court, then after the final decision of such forum is rendered, the Company or the Indemnitee shall have the right to apply to a court of California, the court in which the proceeding giving rise to the Indemnitee’s claim for indemnification is or was pending, or any other court of competent jurisdiction, for the purpose of appealing the decision of such forum, provided that such right is executed within sixty (60) days after the final decision of such forum is rendered. If the forum selected in accordance with Section 8.4 hereof is a court, then the rights of the Company or the Indemnitee to appeal any decision of such court shall be governed by the applicable laws and rules governing appeals of the decision of such court.

 

8.7 Expenses for Interpretation . Notwithstanding any other provision in this Agreement to the contrary, 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. Exceptions . Any other provision herein to the contrary notwithstanding, the Company shall not be obligated pursuant to the terms of this Agreement in the following circumstances:

 

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9.1 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 specifically authorized by the Board or brought to establish or enforce a right to indemnification and/or advancement of expenses arising under this Agreement, the charter documents of the Company or any subsidiary, or any statute or law or otherwise, but such indemnification or advancement of expenses may be provided by the Company in specific cases if the Board finds it to be appropriate; or

 

9.2 Unauthorized Settlements . To indemnify the Indemnitee hereunder for any amounts paid in settlement of a proceeding unless the Company consents in advance in writing to such settlement, which consent shall not be unreasonably withheld; or

 

9.3 Securities Law Actions . To indemnify the Indemnitee on account of any suit in which judgment is rendered against the Indemnitee for an accounting of profits made from the purchase or sale by the Indemnitee of securities of the company pursuant to the provisions of Section 16(b) of the Securities Exchange Act of 1934 and amendments thereto or similar provisions of any federal, state, or local statutory law; or

 

9.4 Unlawful Indemnification . To indemnify the Indemnitee if a final decision by a court having jurisdiction in the mater shall determine that such indemnification is not lawful. In this respect, the Company and the Indemnitee have been advised that the Securities and Exchange Commission takes the position that indemnification for liabilities arising under the federal securities laws is against public policy and is, therefore, unenforceable and that claims for indemnification should be submitted to appropriate courts for adjudication.

 

10. Non-Exclusivity . The provisions for indemnification and advancement of expenses set forth in this Agreement shall not be deemed exclusive of any other rights that 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 action in the Indemnitee’s official capacity and to action in another capacity while occupying the Indemnitee’s 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.

 

11. General Provisions .

 

11.1 Interpretation of Agreement . It is understood that the parties hereto intend this Agreement to be interpreted and enforced so as to provide indemnification and advancement of expenses to the Indemnitee to the fullest extent now or hereafter permitted by law, except as expressly limited herein.

 

11.2 Severability . If any provision or provisions of this Agreement shall be held to be invalid, illegal, or unenforceable for any reason whatsoever, then: (a) the validity, legality, and enforceability of the remaining 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 not in any way be affected or impaired thereby; and (b) 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 11.1 hereof.

 

11.3 Modification and Waiver . No supplement, modification, or amendment of this Agreement shall be binding unless executed in writing by 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.

 

11.4 Subrogation . In the event of full payment under this Agreement, the Company shall be subrogated to the extent of such payment to all of the rights of recovery of the Indemnitee, who shall execute all documents required and shall do all acts that may be necessary or desirable to secure such rights and to enable the Company effectively to bring suit to enforce such rights.

 

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11.5 Counterparts . This Agreement may be executed in one or more counterparts, which shall together constitute one agreement.

 

11.6 Successors and Assigns . The terms of this Agreement shall bind, and shall inure to the benefit of, the successors and assigns of the parties hereto. The indemnification and advancement of expenses provided by, or granted pursuant to, this section shall, unless otherwise provided when authorized or ratified, continue as to a person who has ceased to be a director or an officer and shall inure to the benefit of the heirs, executors, and administrators of such a person.

 

11.7 Notice . All notices, requests, demands, and other communications under this Agreement shall be in writing and shall be deemed duly given if (a) delivered by hand and receipted for by the party addressee, or (b) 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.

 

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

 

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

 

11.10 Attorneys’ Fees . In the event Indemnitee is required to bring any action to enforce rights under this Agreement (including, without limitation, the expenses of any proceeding described in Section 4), the Indemnitee shall be entitled to all reasonable fees and expenses in bringing and pursuing such action, unless a court of competent jurisdiction finds each of the material claims of the Indemnitee in any such action was frivolous and not made in good faith.

 

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IN WITNESS WHEREOF , the parties hereto have entered into this Indemnification Agreement effective as of the date first written above.

 

GREATER CANNABIS COMPANY, INC.

  INDEMNITEE:
       
By: /s/ Aitan Zacharin   /s/ Aitan Zacharin
Name:  Aitan Zacharin   Aitan Zacharin
Title: President    

 

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INDEMNIFICATION AGREEMENT

 

This Indemnification Agreement (this “Agreement”), dated as of July 31, 2018, is made by and between Greater Cannabis Company, Inc., a Florida corporation (the “Company”), and the undersigned, who is either a director or an officer (or both) of the Company (the “Indemnitee”), with this Agreement to be deemed effective as of the date that the Indemnitee first assumed either such capacity at the Company.

 

RECITALS

 

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

 

B.       The Board of Directors of the Company (the “Board”) has concluded that, to retain and attract talented and experienced individuals to serve as officers or directors of the Company, it is necessary for the Company contractually to indemnify certain of such persons and to assume for itself maximum liability for expenses and damages in connection with claims against such persons in connection with their service to the Company;

 

C.       Section 607.0850 (1) of Chapter 607 of the Florida Business Corporation Act, under which the Company is organized (“Section 607.0850”), empowers the Company to indemnify by agreement its present and former officers and directors and persons who serve, at the request of the Company, as directors or officers of other corporations, partnerships, joint ventures, trusts, or other enterprises and expressly provides that the indemnification provided by Section 607.0850 is not exclusive; and

 

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

 

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

 

  1. Definitions

 

1.1        Agent . For the purposes of this Agreement, “agent” of the Company means any person who is or was a director or an officer of the Company or a subsidiary of the Company; or is or was serving at the request of the Company or a subsidiary of the Company as a director or an officer of another foreign or domestic corporation, partnership, joint venture, trust, or other enterprise or an affiliate of the Company. The term “enterprise” includes any employee benefit plan of the Company, its subsidiaries, affiliates, and predecessor corporations.

 

1.2        Company . For purposes of this Agreement, the “Company” includes, in addition to the resulting corporation, any constituent corporation (including any constituent of a constituent) absorbed in a consolidation or merger that, if its separate existence had continued, would have had power and authority to indemnify its directors or officers so that any person who is or was a director or an officer of such constituent corporation, or is or was serving at the request of such constituent corporation as a director or an officer of another corporation, partnership, joint venture, trust, or other enterprise, shall stand in the same position under this Agreement with respect to the resulting or surviving corporation as such person would have with respect to such constituent corporation if its separate existence had continued.

 

1.3        Expenses . For the 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 the investigation, defense, or appeal of a proceeding or establishing or enforcing a right to indemnification or advancement of expenses under this Agreement, Section [  ] or otherwise; provided , however , that expenses shall not include any judgments, fines, ERISA excise taxes or penalties, or amounts paid in settlement of a proceeding.

 

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1.4        Fines . For purposes of this Agreement, references to “fines” includes any excise taxes assessed on a person with respect to any employee benefit plan.

 

1.5        Liabilities . For purposes of this Agreement, “liabilities” means judgments, fines, ERISA execute taxes or penalties, and amounts paid in settlement in connection with a proceeding.

 

1.6        Other Enterprises . For purposes of this Agreement, “other enterprises” includes employee benefit plans.

 

1.7        Proceeding . For the purposes of this Agreement, “proceeding” means any threatened, pending, or completed action, suit, or other proceeding, whether civil, criminal, administrative, or investigative.

 

1.8        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 of its subsidiaries, or by one or more of the Company’s subsidiaries.

 

1.9        Serving at the Request of the Company . For purposes of this Agreement, “serving at the request of the Company” includes any service as a director or an officer of the Company that imposes duties on, or involves services by, such director or officer with respect to an employee benefit plan, its participants or beneficiaries; and a person who acted in good faith and in a manner such person reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan shall be deemed to have acted in a manner “not opposed to the best interests of the Company” as referred to in this Agreement.

 

2.        Agreement to Serve . The Indemnitee agrees to serve and/or continue to serve as an agent of the Company, at the will of the Company (or under separate agreement, if such agreement exists), in the capacity the Indemnitee currently serves as an agent of the Company, faithfully and to the best of his ability, so long as he is duly appointed or elected and qualified in accordance with the applicable provisions of the charter documents of the Company or any subsidiary of the Company; provided , however , that the Indemnitee may at any time and for any reason resign from such position (subject to any contractual obligation that the Indemnitee may have assumed apart from this Agreement), and the Company and any subsidiary shall have no obligation under this Agreement to continue the Indemnitee in any such position.

 

3.        Directors’ and Officers’ Insurance . The Company shall, to the extent that the Board determines it to be economically reasonable, maintain a policy of directors’ and officers’ liability insurance (“D&O Insurance”), on such terms and conditions as may be approved by the Board.

 

4.        Mandatory Indemnification . Subject to Section 9 below, the Company hereby agrees to hold harmless and indemnify the Indemnitee to the fullest extent permitted by law, as such may be amended from time to time. In furtherance of the foregoing indemnification, and without limiting the generality thereof:

 

4.1        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 (except an action by or in the right of the Company) 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 the Indemnitee in any such capacity, against any and all expenses and liabilities of any type whatsoever incurred by the Indemnitee in connection with such proceeding if (a) the Indemnitee acted in good faith and in a manner the Indemnitee 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 the Indemnitee’s conduct was unlawful, or (b) the Indemnitee, if a director or an officer of the Company, did not act or fail to act in a manner that constituted a breach of the Indemnitee’s fiduciary duties as a director or an officer or such Indemnitee’s breach of those duties did not involve intentional misconduct, fraud, or a knowing violation of law; and

 

4.2        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 the Indemnitee is or was an agent of the Company, or by reason of anything done or not done by the Indemnitee in any such capacity, against any and all expenses and liabilities incurred by the Indemnitee in connection with such proceeding if (a) the Indemnitee acted in good faith and in a manner the Indemnitee reasonably believed to be in, or not opposed to, the best interests of the Company, or (b) the Indemnitee, if a director or an officer of the Company, did not act or fail to act in a manner that constituted a breach of the Indemnitee’s fiduciary duties as a director or an officer or such Indemnitee breach of those duties involved intentional misconduct, fraud, or a knowing violation of law; except that no indemnification under this subsection shall be made in respect of any claim, issue, or matter as to which the Indemnitee shall have been adjudged by a court of competent jurisdiction, after the exhaustion of all appeals therefrom, to be liable to the Company or for amounts paid in settlement to the Company, unless and only to the extent that the court in which such proceeding was brought or another court of competent jurisdiction determines upon application that, in view of all the circumstances of the case, the Indemnitee is fairly and reasonable entitled to indemnity for such expenses as the court deems proper; and

 

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4.3        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, fines, ERISA excise taxes or penalties, and amounts paid in settlement) to the extent such have been paid to the Indemnitee by D&O Insurance.

 

4.4        Indemnification for Expenses as a Witness . Notwithstanding any other provision of this Agreement, to the extent that Indemnitee is, by reason of the Indemnitee’s status as an agent of the Company, a witness, or is made (or asked) to respond to discovery requests, in any proceeding to which Indemnitee is not a party, the Indemnitee shall be indemnified against all expenses and liabilities of any type whatsoever actually and reasonably incurred by him or her or on his or her behalf in connection therewith.

 

  5. Partial Indemnification and Contribution .

 

5.1        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 incurred by the Indemnitee in connection with a proceeding but is not entitled, however, to indemnification for all of the total amount thereof, then the Company shall nevertheless indemnify the Indemnitee for such total amount except as to the portion thereof to which the Indemnitee is not entitled to indemnification.

 

5.2        Contribution . If the Indemnitee is not entitled to the indemnification provided in Section 4 for any reason other than the statutory limitations set forth in the Florida Revised Statutes, then in respect of proceeding in which the Company is jointly liable with the Indemnitee (or would be if joined in such proceeding), the Company shall contribute to the amount of expenses and liabilities paid or payable by the Indemnitee in such proportion as is appropriate to reflect (a) the relative benefits received by the Company on the one hand and the Indemnitee on the other hand from the transaction from which such proceeding arose and (b) the relative fault of the Company on the one hand and of the Indemnitee on the other hand in connection with the events that resulted in such expenses, as well as any other relevant equitable considerations. The relative fault of the Company on the one hand and of the Indemnitee on the other hand shall be determined by reference to, among other things, the parties’ relative intent, knowledge, access to information, and opportunity to correct or prevent the circumstances resulting in such expenses, judgments, fines, or settlement amounts. The Company agrees that it would not be just and equitable if contribution pursuant to this Section 5 were determined by pro rata allocation or any other method of allocation which does not take account of the foregoing equitable considerations.

 

  6. Mandatory Advancement of Expenses .

 

6.1        Advancement . Subject to Section 9 below, the Company shall pay as incurred and in advance of the final disposition of a civil or criminal proceeding all expenses incurred by the Indemnitee in connection with defending any such 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 the Indemnitee in any such capacity. The Indemnitee hereby undertakes to promptly repay such amounts advanced only if, and to the extent that, it shall ultimately by determined that the Indemnitee is not entitled to be indemnified by the Company under the provisions of this Agreement, the Articles of Incorporation or Bylaws of the Company, the Florida Revised Statutes, or otherwise. The advances to be made hereunder shall be paid by the Company to the Indemnitee within thirty (30) days following delivery of a written request therefor by the Indemnitee to the Company.

 

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6.2        Exception . Notwithstanding the foregoing provisions of this Section 6, the Company shall not be obligated to advance any expenses to the Indemnitee arising from a lawsuit filed directly by the Company against the Indemnitee if an absolute majority of the members of the Board reasonably determines in good faith, within thirty (30) days of the Indemnitee’s request to be advanced expenses, that the facts known to them at the time such determination is made demonstrate clearly and convincingly that the Indemnitee acted in bad faith. If such a determination is made, the Indemnitee may have such decision reviewed in the manner set forth in Section 8.5 hereof, with all references therein to “indemnification” being deemed to refer to “advancement of expenses,” and the burden of proof shall be on the Company to demonstrate clearly and convincingly that, based on the facts known at the time, the Indemnitee acted in bad faith. The Company may not avail itself of this Section 6.2 as to a given lawsuit if, at any time after the occurrence of the activities or omissions that are the primary focus of the lawsuit, the Company has undergone a change in control. For this purpose, a “change in control” shall mean a given person of group of affiliated persons or groups increasing their beneficial ownership interest in the Company by at least twenty (20) percentage points without advance Board approval.

 

  7. Notice and Other Indemnification Procedures .

 

7.1        Notification . 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.

 

7.2        Insurance . If, at the time of the receipt of a notice of the commencement of a proceeding pursuant to Section 7.1 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 D&O Insurance policies.

 

7.3        Defense . In the event the Company shall be obligated to advance the expenses for any proceeding against the Indemnitee, the Company, if appropriate, shall be entitled to assume the defense of such proceeding, with counsel approved by the Indemnitee (which approval shall not be unreasonably withheld), upon the delivery to the Indemnitee of written notice of its election to do so. After delivery of such notice, approval of such counsel by the Indemnitee and the retention of such counsel by the Company, the Company will not be liable to the Indemnitee under this Agreement for any fees of counsel subsequently incurred by the Indemnitee with respect to the same proceeding, provided that (a) the Indemnitee shall have the right to employ the Indemnitee’s own counsel in any such proceeding at the Indemnitee’s expense; (b) the Indemnitee shall have the right to employ the Indemnitee’s own counsel in connection with any such proceeding, at the expense of the Company, if such counsel serves in a review, observer, advice, and counseling capacity and does not otherwise materially control or participate in the defense of such proceeding; and (c) if (i) the employment of counsel by the Indemnitee has been previously authorized by the Company, (ii) the Indemnitee shall have reasonably concluded that there may be conflict of interest between the Company and the Indemnitee in the conduct of any such defense, or (iii) the Company shall not, in fact, have employed counsel to assume the defense of such proceeding, then the fees and expenses of the Indemnitee’s counsel shall be at the expense of the Company.

 

  8. Determination of Right to Indemnification .

 

8.1        Success on Merits . To the extent the Indemnitee has been successful on the merits or otherwise in defense of any proceeding referred to in Section 4.1 or 4.2 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 the Indemnitee in connection with the investigation, defense, or appeal of such proceeding, or such claim, issue, or matter, as the case may be.

 

8.2        Proof by Company . In the event that Section 8.1 is inapplicable, or does not apply to the entire proceeding, the Company shall nonetheless indemnify the Indemnitee unless the Company shall prove by clear and convincing evidence to a forum listed in Section 8.4 below that the Indemnitee has not met the applicable standard of conduct required to entitle the Indemnitee to such indemnification.

 

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8.3        Termination of Proceeding . The termination of any proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere its equivalent, does not, of itself, create a presumption that a person (a) did not act in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the Company, (b) with respect to any criminal action or proceeding, that the person had reasonable cause to believe that the person’s conduct was unlawful, or (c) the person’s act or failure to act constituted a breach of the person’s fiduciary duties as a director or an officer or the person’s breach of those duties involved intentional misconduct, fraud, or a knowing violation of law.

 

8.4        Applicable Forums . The Indemnitee shall be entitled to select the forum in which the validity of the Company’s claim under Section 8.2 hereof that the Indemnitee is not entitled to indemnification will be heard from among the following, except that the Indemnitee can select a forum consisting of the stockholders of the Company only with the approval of the Company and, if the Indemnitee is a director or an officer at the time of such determination, the determination shall be made in accordance with (a), (b), (c) or (d) below at the election of the Company:

 

(a)       A majority vote of the directors who are not parties to the proceeding for which indemnification is being sought even though less than a quorum;

 

(b)       By a committee of directors who are not parties to the proceeding for which indemnification is being sought designated by a majority vote of such directors, even though less than a quorum;

 

(c)       If there are no directors who are not parties to the proceeding for which indemnification is sought, or if such directors so direct, by independent legal counsel in a written opinion;

 

(d)       The stockholders of the Company;

 

(e)       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; or

 

(f)       A court having jurisdiction of subject matter and the parties.

 

8.5        Submission . As soon as practicable, and in no event later than thirty (30) days after the forum has been selected pursuant to Section 8.4 above, the Company shall, at its own expense, submit to the selected forum 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.

 

8.6        Appeals . If the forum selected in accordance with Section 8.4 hereof is not a court, then after the final decision of such forum is rendered, the Company or the Indemnitee shall have the right to apply to a court of California, the court in which the proceeding giving rise to the Indemnitee’s claim for indemnification is or was pending, or any other court of competent jurisdiction, for the purpose of appealing the decision of such forum, provided that such right is executed within sixty (60) days after the final decision of such forum is rendered. If the forum selected in accordance with Section 8.4 hereof is a court, then the rights of the Company or the Indemnitee to appeal any decision of such court shall be governed by the applicable laws and rules governing appeals of the decision of such court.

 

8.7        Expenses for Interpretation . Notwithstanding any other provision in this Agreement to the contrary, 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.        Exceptions . Any other provision herein to the contrary notwithstanding, the Company shall not be obligated pursuant to the terms of this Agreement in the following circumstances:

 

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9.1        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 specifically authorized by the Board or brought to establish or enforce a right to indemnification and/or advancement of expenses arising under this Agreement, the charter documents of the Company or any subsidiary, or any statute or law or otherwise, but such indemnification or advancement of expenses may be provided by the Company in specific cases if the Board finds it to be appropriate; or

 

9.2        Unauthorized Settlements . To indemnify the Indemnitee hereunder for any amounts paid in settlement of a proceeding unless the Company consents in advance in writing to such settlement, which consent shall not be unreasonably withheld; or

 

9.3        Securities Law Actions . To indemnify the Indemnitee on account of any suit in which judgment is rendered against the Indemnitee for an accounting of profits made from the purchase or sale by the Indemnitee of securities of the company pursuant to the provisions of Section 16(b) of the Securities Exchange Act of 1934 and amendments thereto or similar provisions of any federal, state, or local statutory law; or

 

9.4        Unlawful Indemnification . To indemnify the Indemnitee if a final decision by a court having jurisdiction in the mater shall determine that such indemnification is not lawful. In this respect, the Company and the Indemnitee have been advised that the Securities and Exchange Commission takes the position that indemnification for liabilities arising under the federal securities laws is against public policy and is, therefore, unenforceable and that claims for indemnification should be submitted to appropriate courts for adjudication.

 

10.        Non-Exclusivity . The provisions for indemnification and advancement of expenses set forth in this Agreement shall not be deemed exclusive of any other rights that 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 action in the Indemnitee’s official capacity and to action in another capacity while occupying the Indemnitee’s 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.

 

  11. General Provisions .

 

11.1        Interpretation of Agreement . It is understood that the parties hereto intend this Agreement to be interpreted and enforced so as to provide indemnification and advancement of expenses to the Indemnitee to the fullest extent now or hereafter permitted by law, except as expressly limited herein.

 

11.2        Severability . If any provision or provisions of this Agreement shall be held to be invalid, illegal, or unenforceable for any reason whatsoever, then: (a) the validity, legality, and enforceability of the remaining 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 not in any way be affected or impaired thereby; and (b) 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 11.1 hereof.

 

11.3        Modification and Waiver . No supplement, modification, or amendment of this Agreement shall be binding unless executed in writing by 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.

 

11.4        Subrogation . In the event of full payment under this Agreement, the Company shall be subrogated to the extent of such payment to all of the rights of recovery of the Indemnitee, who shall execute all documents required and shall do all acts that may be necessary or desirable to secure such rights and to enable the Company effectively to bring suit to enforce such rights.

 

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11.5        Counterparts . This Agreement may be executed in one or more counterparts, which shall together constitute one agreement.

 

11.6        Successors and Assigns . The terms of this Agreement shall bind, and shall inure to the benefit of, the successors and assigns of the parties hereto. The indemnification and advancement of expenses provided by, or granted pursuant to, this section shall, unless otherwise provided when authorized or ratified, continue as to a person who has ceased to be a director or an officer and shall inure to the benefit of the heirs, executors, and administrators of such a person.

 

11.7        Notice . All notices, requests, demands, and other communications under this Agreement shall be in writing and shall be deemed duly given if (a) delivered by hand and receipted for by the party addressee, or (b) 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.

 

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

 

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

 

11.10        Attorneys’ Fees . In the event Indemnitee is required to bring any action to enforce rights under this Agreement (including, without limitation, the expenses of any proceeding described in Section 4), the Indemnitee shall be entitled to all reasonable fees and expenses in bringing and pursuing such action, unless a court of competent jurisdiction finds each of the material claims of the Indemnitee in any such action was frivolous and not made in good faith.

 

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IN WITNESS WHEREOF , the parties hereto have entered into this Indemnification Agreement effective as of the date first written above.

 

GREATER CANNABIS COMPANY, INC.   INDEMNITEE:
     
By: /s/ Aitan Zacharin   /s/ Mark Radon
Name:  Aitan Zacharin                                  Mark Radom
Title: President    

 

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CONSULTING AGREEMENT

 

This Consulting Agreement (the “Agreement”) is made and entered into as of this 31st day of July 2018, by and between The Greater Cannabis Company, Inc., a Florida corporation whose address is 244 2 nd Ave N, Suite 9, St. Petersburg, FL 33701 (the “Company”) and Jimmy Wayne Anderson (the “Consultant”), in his individual capacity whose address is 145 Bay Point Dr. NE, St. Petersburg, FL 33704, (individually, a “Party”; collectively, the “Parties”).

 

RECITALS

 

WHEREAS, Consultant was the sole officer and director of the Company prior to the change of officers and directors as per the terms of the Share Exchange Agreement between the Company and Green C Corporation dated July 31, 2018.

 

NOW, THEREFORE, in consideration of the mutual promises herein contained, the Parties hereto hereby agree as follows:

 

1. CONDITIONS. This Agreement will not take effect, and Consultant will have no obligation to provide any service whatsoever, unless and until the Company sends a signed copy of this Agreement to Consultant (either by mail or facsimile copy). The Company shall be truthful with Consultant in regard to any relevant material regarding the Company, verbally or otherwise, or this entire Agreement will terminate and all consideration paid shall be forfeited without further notice.

 

2. Upon execution of this Agreement, the Company agrees to cooperate with Consultant in carrying out the purposes of this Agreement, keep Consultant informed of any developments of importance pertaining to the Company’s business and abide by this Agreement in its entirety.

 

2. TERM OF AGREEMENT. This Agreement shall be in full force and effect commencing on July 31, 2018 and shall remain in effect for one month. Either Party shall have the right to terminate this Agreement without notice in the event of the bankruptcy, insolvency, or assignment for the benefit of creditors of the other Party. Either Party shall have the right to terminate this Agreement with notice, and the effective date of termination shall be the date such notice is received (by mail, overnight delivery, or fax) by the terminated Party.

 

3. CONSULTING SERVICES. During the term of this Agreement, Consultant will perform the services described below (the “Consulting Services”) for the Company.

 

(a) Transactional Business

 

(i) Introduce the Company to the Company’s key service providers such as the Company’s transfer agent, accounting firm, auditor, counsel and others as identified; and

 

(ii) Assist the Company in the preparation of the June 30, 2018 Quarterly Report.

 

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4. STANDARD OF PERFORMANCE . Consultant shall devote such time and efforts to the affairs of the Company as is reasonably necessary to render the services contemplated by this Agreement. Consultant is not responsible for the performance of any services that may be rendered hereunder if the Company fails to provide the requested information in writing prior thereto. The services of Consultant shall not include the rendering of any legal opinions or the performance of any work that is in the ordinary purview of a certified public accountant. Consultant cannot guarantee results on behalf of the Company but shall use commercially reasonable efforts in providing the services listed above. Consultant’s duty is to identify prospective acquisition/joint venture companies for the Company. Consultant will in no way act as a “broker-dealer” under state securities laws. Because all final decisions pertaining to any particular investment are to be made by the Company, the Company may be required to communicate directly with potential acquisition/joint venture prospective companies.

 

5. COMPENSATION TO CONSULTANT. As Consultant’s entire compensation for its performance under this agreement, the Company shall pay Consultant $50,000 upon execution and delivery of this Agreement and the director services termination letter of even date herewith. In the event the Consultant is terminated, with or without cause, Consultant shall retain all compensation paid to Consultant. The Consultant will be solely responsible for all tax returns and payments required to be filed with or made to any federal, state or local tax authority with respect to the Consultant’s performance of services and receipt of fees under this Agreement. The Company will regularly report amounts paid, if any, to the Consultant by filing Form 1099-MISC and/or other appropriate form with the Internal Revenue Service as required by law. Because the Consultant is an independent contractor, the Company will not withhold or make payments for social security; make consulting contract insurance or disability insurance contributions; or obtain worker’s compensation insurance on the Consultant’s behalf. The Consultant agrees to accept exclusive liability for complying with all applicable state and federal laws governing self-employed individuals, including obligations such as payment of taxes, social security, disability and other contributions based on fees paid to the Consultant under this Agreement. The Consultant hereby agrees to indemnify and defend the Company against any and all such taxes or contributions, including penalties and interest.

 

6. CONFIDENTIAL INFORMATION. The Consultant and the Company acknowledge that each will have access to proprietary information regarding the business operations of the other and agree to keep all such information secret and confidential and not to use or disclose any such information to any individual or organization without the non-disclosing Parties prior written consent unless such information is in or enters the public domain after the date hereof.

 

7. INDEMNIFICATION. Each Party (the “Indemnifying Party”) agrees to indemnify, defend, and hold harmless the other Party (the “Indemnified Party”) from and against any and all claims, damages, and liabilities, including any and all expense and costs, legal or otherwise, caused by the negligent act or omission of the Indemnifying Party, its subcontractors, agents, or employees, incurred by the Indemnified Party in the investigation and defense of any claim, demand, or action arising out of the work performed under this Agreement; including breach of the Indemnifying Party of this Agreement. The Indemnifying Party shall not be liable for any claims, damages, or liabilities caused by the sole negligence of the Indemnified Party, its subcontractors, agents, or employees.

 

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The Indemnified Party shall notify promptly the Indemnifying Party of the existence of any claim, demand, or other matter to which the Indemnifying Party’s indemnification obligations would apply, and shall give them a reasonable opportunity to settle or defend the same at their own expense and with counsel of their own selection, provided that the Indemnified Party shall at all times also have the right to fully participate in the defense. If the Indemnifying Party, within a reasonable time after this notice, fails to take appropriate steps to settle or defend the claim, demand, or the matter, the Indemnified Party shall, upon written notice, have the right, but not the obligation, to undertake such settlement or defense and to compromise or settle the claim, demand, or other matter on behalf, for the account, and at the risk, of the Indemnifying Party.

 

The rights and obligations of the Parties under this Article shall be binding upon and inure to the benefit of any successors, assigns, and heirs of the Parties.

 

8. COVENANTS OF CONSULTANT. Consultant covenants and agrees with the Company that, in performing Consulting Services under this Agreement, Consultant will:

 

(a) Comply with all federal and state laws;

 

(b) Not make any representations other than those authorized by the Company; and

 

(c) Not publish, circulate or otherwise use any materials or documents other than materials provided by or otherwise approved by the Company.

 

9. REPRESENTATIONS OF THE COMPANY. The Company covenants, represents and warrants to Consultant as follows:

 

(a) Authorization. The Company and its signatories herein have full power and authority to enter into this Agreement and to carry out the transactions contemplated hereby.

 

(b) No Violation. Neither the execution and delivery of this Agreement nor the consummation of the transactions contemplated hereby will violate any provision of the charter or by-laws of the Company or violate any terms of provision of any other material agreement to which the Company is a party or any applicable statute or law.

 

(c) Contracts in Full Force and Effect. All contracts, agreements, plans, policies and licenses to which the Company is a party are valid and in full force and effect.

 

(d) Consents. No consent of any person, other than the signatories hereto, is necessary to the consummation of the transactions contemplated hereby, including, without limitation, consents from parties to loans, contracts, lease or other agreements and consents from governmental agencies, whether federal, state, or local.

 

(e) Consultant Reliance. Consultant has and will rely upon the documents, instruments and written information furnished to Consultant by the Company’s officers or designated employees.

 

(f) Company’s Material. All representations and statements provided herein about the Company are true and complete and accurate. The Company agrees to indemnify, hold harmless, and defend Consultant, its officers, directors, agents and employees, at the Company’s expense for any proceeding or suit which may rise out of any inaccuracy or incompleteness of any such material or written information supplied to Consultant.

 

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10. MISCELLANEOUS PROVISIONS

 

(a) Amendment and Modification. This Agreement may be amended, modified and supplemented only by written agreement of the Company and Consultant.

 

(b) Waiver of Compliance. Any failure of Consultant, on the one hand, or the Company, on the other, to comply with any obligation, agreement, or condition herein may be expressly waived in writing, but such waiver or failure to insist upon strict compliance with such obligation, covenant, agreement or condition shall not operate as a waiver of, or estoppel with respect to, any subsequent or other failure.

 

(c) Expenses, Transfer Taxes, Etc. Other than as expressly set forth in this Agreement, the Parties shall bear their own costs and expenses in carrying out the provisions of this Agreement.

 

(d) Compliance with Regulatory Agencies. Each Party agrees that all actions, direct or indirect, taken by it and its respective agents, employees and affiliates in connection with this Agreement and any financing or underwriting hereunder shall conform to all applicable Federal and State securities laws.

 

(e) Notices. Any notices to be given hereunder by any Party to the other may be effected either by personal delivery in writing, by a reputable, national overnight delivery service, by facsimile transmission or by mail, registered or certified, postage prepaid with return receipt requested. Notices shall be addressed to the “Contact Person” at the addresses appearing on the signature page of this Agreement, but any Party may change his address or “Contact Person” by written notice in accordance with this subsection. Notices delivered personally shall be deemed delivered as of actual receipt, notices sent by facsimile shall be deemed delivered one (1) day after electronic confirmation of receipt, notices sent by overnight delivery service shall be deemed delivered one (1) day after delivery to the service, mailed notices shall be deemed delivered as of five (5) days after mailing.

 

(f) Assignment. This Agreement and all of the provisions hereof shall be binding upon and inure to the benefit of the Parties hereto and their respective successors and permitted assigns.

 

(g) Delegation. Neither Party shall delegate the performance of its duties under this Agreement without the prior written consent of the other Party.

 

(h) Publicity. Neither Consultant nor the Company shall make or issue or cause to be made or issued, any announcement or written statement concerning this Agreement or the transactions contemplated hereby for dissemination to the general public without the prior consent of the other Party. This provision shall not apply, however, to any announcement or written statement required to be made by law or the regulations of any Federal or State governmental agency, except that the Party required to disclose shall consult with and make reasonable efforts to accommodate changes to the required disclosure and the timing of such announcement suggested by the other Party.

 

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(i) Arbitration and Governing Law. If a dispute arises out of or relates to this contract, or the breach thereof, and if the dispute cannot be settled through negotiation, the parties agree first to try in good faith to settle the dispute by mediation administered by the American Arbitration Association under its Commercial Mediation Procedures before resorting to arbitration, litigation, or some other dispute resolution procedure. If they do not reach such solution within a period of 60 days, then, upon notice by either party to the other, all disputes, claims, questions, or differences shall be finally settled by arbitration administered by the American Arbitration Association in accordance with the provisions of its Commercial Arbitration Rules. This Agreement and the legal relations among the Parties hereto shall be governed by and construed in accordance with the laws of the State of Florida, without regard to its conflict of law doctrine. The Parties agree that the venue for the resolution of all disputes arising under the terms of this Agreement and the transactions contemplated herein will be the County of Pinellas, State of Florida.

 

(j) Counterparts. This Agreement may be executed simultaneously in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

 

(k) Headings. The heading of the sections of this Agreement are inserted for convenience only and shall not constitute a part hereto or affect in any way the meaning or interpretation of this Agreement.

 

(l) Entire Agreement. This Agreement including any Exhibits hereto, and the other documents and certificates delivered pursuant to the terms hereto, set forth the entire agreement and understanding of the Parties hereto in respect of the subject matter contained herein, and supersedes all prior agreements, promise, covenants, arrangements, communications, representations or warranties, whether oral or written, by any officers employee or representative of any Party hereto.

 

(m) Third Parties. Except as specifically set forth or referred to herein, nothing herein express or implied is intended or shall be construed to confer upon or give to any person or entity other than the Parties hereto and their successors or assigns, any rights or remedies under or by reason of this Agreement.

 

(n) Attorneys’ Fees and Costs. If any action is necessary to enforce and collect upon the terms of this Agreement, the prevailing Party shall be entitled to reasonable attorneys’ fees and costs, in addition to any other relief to which that Party may be entitled. This provision shall be construed as applicable to the entire Agreement.

 

(o) Survivability. If any part of this Agreement is found or deemed by a court of competent jurisdiction to be invalid or unenforceable, that part shall be severable from the remainder of the Agreement.

 

(p) Further Assurances. Each of the Parties agrees that it shall from time-to-time take such actions and execute such additional instruments as may be reasonably necessary or convenient to implement and carry out the intent and purposes of this Agreement.

 

(q) Relationship of the Parties. Nothing contained in this Agreement shall be deemed to constitute either Party becoming the partner of the other, the agent or legal representative of the other, nor create any fiduciary relationship between them, except as otherwise expressly provided herein. It is not the intention of the Parties to create nor shall this Agreement be construed to create any commercial relationship or other partnership. Neither Party shall have any authority to act for or to assume any obligation or responsibility on behalf of the other Party, except as otherwise expressly provided herein. The rights, duties, obligations and liabilities of the Parties shall be separate, not joint or collective. Each Party shall be responsible only for its obligations as herein set out and shall be liable only for its share of the costs and expenses as provided herein.

 

(r) No Authority to Obligate the Company. Without the consent of the Board of Directors of the Company, Consultant shall have no authority to take, nor shall it take, any action committing or obligating the Company in any manner, and it shall not represent itself to others as having such authority.

 

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IN WITNESS, WHEREOF, the Parties hereto have caused this Agreement to be duly executed, all as of the day and year first above written.

 

COMPANY: CONSULTANT:
THE GREATER CANNABIS COMPANY, INC. JIMMY WAYNE ANDERSON
244 2 nd Ave N., Suite 9 145 Bay Point Dr. NE
St. Petersburg, FL 33701 St. Petersburg, FL 33704

 

By:   By:
     
/s/ Aitan Zacharin   /s/ Jimmy Wayne Anderson
Aitan Zacharin   Jimmy Wayne Anderson
Its: Chief Executive Officer   Its: Individual Capacity
Date: July 31, 2018   Dated: July 31, 2018

 

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THIS EXCLUSIVE LICENSE AGREEMENT (this “ Agreement ”) is made and entered into as of June 21, 2018 (the “ Effective Date ”), by and between Pharmedica Ltd. an Israeli company (“ Pharmedica ”), and Green C Corporation a company incorporated under the laws of Canada with its principal place of business at 1 Whitehorse Road, Unit 16, Toronto, Ontario M3J 3G8 (“ Licensee ”). Pharmedica and Licensee each may be referred to herein individually as a “ Party ,” or collectively as the “ Parties ”.

 

WHEREAS, Pharmedica has developed and is the sole owner of or the exclusive licensee of the Licensed Patent and related Know-How; and

 

WHEREAS, Pharmedica is, as at the Effective Date, and intends to continue to be, involved with a third party company (“ Third Party Company ”) in the development and eventual commercialization of a product exploiting the Pharmedica Patent(s) and related Know-How for applications in the oral care field; and

 

WHEREAS, Pharmedica wishes to grant to Licensee and Licensee is willing to receive from Pharmedica an exclusive license under the Pharmedica IP to develop, market, use, sell, offer for sale, import, export, manufacture, commercialize and distribute the Licensed Product all in accordance with the terms and conditions of this Agreement; and

 

WHEREAS, each Party hereto has the ability, expertise and experience to perform its obligations hereunder.

 

NOW THEREFORE, THE PARTIES HERETO HAVE AGREED AS FOLLOWS:

 

1. Preamble, Appendices and Interpretation

 

1.1 The Preamble and Appendices hereto form an integral part of this Agreement.

 

1.2 In this Agreement the following terms shall bear the meanings assigned to them below, unless specifically stated otherwise:

 

1.2.1 “Affiliate” shall mean, with respect to any party hereto, any person, organization or entity directly or indirectly controlling, controlled by or under common control with, such party. For purposes of this definition only, “control” of another person, organization or entity shall mean the ability, directly or indirectly, to direct the activities of the relevant entity, and shall include, without limitation (i) ownership or direct control of fifty percent (50%) or more of the outstanding voting stock or other ownership interest of the other organization or entity, or (ii) possession of, or the power to elect or appoint fifty percent (50%) or more of the members of the governing body of the organization or other entity.

 

1.2.2 Derivative Work ” shall mean a work that is based upon one or more preexisting works, such as a revision, modification, translation, abridgment, condensation, expansion, or any other form in which such preexisting works may be recast, transformed or adapted and that if prepared without the authorization of the owner of the preexisting work would constitute an infringement of the proprietary rights of the owner therein.

 

 
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1.2.3 First Commercial Sale ” shall mean, with respect to any Licensed Product in any country, the first commercial sale to a third party by Licensee or its Affiliates or Sublicensees, in exchange for cash or some equivalent to which value can be assigned.

 

1.2.4 Intellectual Property Rights ” shall mean all intangible legal rights, titles and interests, evidenced by or embodied in: (i) all inventions, patents, provisionals, patent applications (whether pending or not), and patent disclosures together with all reissuances, continuations, continuations in part, revisions, extensions, and reexaminations thereof; (ii) all trademarks, service marks, copyrights, designs, trade styles, logos, trade dress, and corporate names, including all goodwill associated therewith; (iii) any work of authorship, regardless of copyrightability, all compilations, all copyrights (including the droit morale); (iv) all trade secrets, and proprietary processes, licenses; and (v) all Derivative Works of the above and all other proprietary rights and any other intellectual property rights of any kind and nature however designated and however recognized in any country or jurisdiction worldwide.

 

1.2.5

Licensed Product ” shall mean Pharmedica’s patch described in Annex A hereto in combination with Cannabidiol (CBD) for medical or recreational cannabis, where latter permitted for the transmucosal delivery of medicinal or recreational cannabis, where latter permitted (other than in the field of oral care) or any other product exploiting the Licensee Cannabis IP for the transmucosal delivery of medicinal or recreational cannabis, where latter permitted.

 

1.2.6 Marketing Approval ” shall mean, with respect to any country, the obtaining of all necessary regulatory approvals (excluding the obtainment of pricing and reimbursement) required in order to commercially sell and market the Licensed Product in such country.

 

1.2.7 Pharmedica IP ” shall mean the Pharmedica Patents and all Intellectual Property Rights embodied therein and/or related thereto and the Pharmedica Know-How.

 

1.2.8 Pharmedica Know-How ” shall mean the formulation information that the Company will deliver to Elisha Kalfa.

 

1.2.9 Pharmedica Patents ” shall mean those patents and patent applications listed in Annex B , as well as patents issuing therefrom, and any substitutions, divisions, continuations, continuations-in-part (but only to the extent that they cover the same invention claimed in the foregoing), reissues, renewals, registrations, confirmations, re-examinations, extensions, supplementary protection certificates and the like, and any provisional applications, of any such patents or patent applications.

 

1.2.10 Net Sales ” shall mean, with respect to each Licensed Product, the total amounts invoiced by or on behalf of Licensee, its Affiliates and their Sublicensees (in each case, the “Invoicing Entity”) on sales of Licensed Products to third parties in bona fide arms length transactions, less deductions for the following items to the extent they are actually allowed and incurred and specifically identifiable as directly related to such License Products in the invoiced amounts: (a) cash discounts; (b) returns of goods as a result of recalls and returns of damaged goods; (c) rebates relating to government mandated programs; and (d) customs, duties, sales, withholding (to the extent not refundable) and similar taxes to the extent such charges were added to the sales price of the Licensed Products.

 

 
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Net Sales shall not include sales by Licensee or one of its Affiliates to other of Licensee’s Affiliates, Sublicensees or contractors for resale, except if such Affiliate, Sublicensee or contractor is an end user of the Licensed Products; rather, in each such instance, Net Sales shall include the amounts invoiced by such Affiliate, Sublicensees or contractors to independent unrelated third parties, in bona fide arm’s length transactions. For purposes of this Agreement, “sale” shall not include reasonable transfers of a Licensed Product at no charge for regulatory or clinical trials purposes; provided that the quantity of Licensed Products actually utilized for purposes of such trials shall not exceed five percent (5%) of the volume of annual Licensed Product sales during any calendar year.

 

In calculating Net Sales, all amounts shall be expressed in US Dollars and any amount received in a currency other than US Dollars shall be converted in accordance with section 4.6.

 

1.2.11 Sublicense ” shall mean any right granted, license conferred, or agreement entered into, by Licensee or its Affiliates to or with any other person or entity, permitting any use of the Pharmedica IP or the Licensed Products, whether or not such grant of rights license or agreements entered into is described as sublicense or as an agreement with respect to the development and/or manufacture and/or marketing and/or distribution and/or sale.

 

1.2.12 Sublicense Receipts ” shall mean all consideration, whether monetary or otherwise, received by Licensee and/or its Affiliates from a Sublicensee in consideration for the grant of a sublicense hereunder, and/or pursuant thereto, or in consideration for the grant of an option for a Sublicense, except for amounts received by Licensee and/or its Affiliates from a Sublicensee which constitute royalties based on Net Sales of Licensed Products. Any Sublicense Receipts received by Licensee in the form of non-cash compensation shall be valued at fair market value, and Sublicense Fees shall be paid by Licensee to Pharmedica in respect of such Sublicense Receipts either in cash or in specie as received by Licensee (at Pharmedica’s sole discretion).

 

1.3 In this Agreement, words importing the singular shall include the plural and vice-versa and words importing any gender shall include all other genders and references to persons shall include partnerships, corporations and unincorporated associations.

 

1.4 In the event of any discrepancy between the terms of this Agreement and any of the Annexes or Appendices hereto, the terms of this Agreement shall prevail.

 

 
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2. LICENSE

 

2.1 During the term of this Agreement and subject to the terms and conditions of this Agreement, Pharmedica hereby grants to Licensee an exclusive license to exploit the Pharmedica IP solely as necessary to develop, manufacture, market, use, sell, offer for sale, import, export, commercialize and distribute the Licensed Products (the “ License ”).

 

2.2 The License shall be sub-licensable, subject to any reasonable objection by Pharmedica to a specific sublicensee. Any such sublicense shall not release Licensee from any liability for performance under this Agreement and Licensee shall be responsible for assuring the compliance of its sublicensees with the relevant terms and conditions of this Agreement. A copy of any Sublicense agreement entered into by Licensee shall be submitted to Pharmedica following execution.

 

Licensee may only perform and/or subcontract development activities to third parties approved in advance and in writing by Pharmedica.

 

2.3 Pharmedica shall provide to Licensee Pharmedica’s available specifications, processes, materials, and any other documentation related to the Pharmedica IP as is reasonably necessary or useful to enable Licensee to utilize the License granted to Licensee under this Agreement. In addition, Pharmedica will make available personnel as reasonably requested by Licensee, to provide such individual training to Licensee’s technical personnel as is necessary to enable Licensee to utilize the License, at such reasonable times and places as Licensee may request from time to time. All Pharmedica’s costs incurred or expended in performing the foregoing shall be reimbursed to Pharmedica by Licensee.

 

2.4 Subject only to the License, all right, title and interest in and to the Licensed Product and the Pharmedica IP and all right, title and interest in and to any drawings, plans, diagrams, specifications, other documents, models, or any other physical matter in any way containing, representing or embodying any of the aforegoing vest and shall vest in Pharmedica. In addition, it is clarified that nothing contained in this Agreement shall prevent Pharmedica from freely using and exploiting the Pharmedica IP and/or Intellectual Property Rights relating to the Licensed Product, including without limitation those developed or first reduced to practice by or on behalf of Licensee, its Affiliates or Sublicensees, in respect of products based on or exploiting the Pharmedica IP for use in oral care applications or any other applications whatsoever (other than the transmucosal delivery of medicinal or recreational cannabis, where latter permitted).

 

2.5 Pharmedica makes no warranties whatsoever as to any results to be achieved in consequence of the carrying out of any development efforts or activities; or that the Pharmedica IP or any part thereof is or will be valid or will afford proper protection or that the Pharmedica IP will be commercially exploitable or of any other value.

 

2.6

Licensee acknowledges that it is aware that Pharmedica is in the process of effecting a commercial transaction with the Third Party Company with regard to Pharmedica’s patch described in Annex A hereto and Pharmedica IP, as well as certain related technology, for oral health applications. Licensee undertakes to assist Pharmedica as required to promote such transaction, and not to take any action the consequence of which might be harmful to the chances of such transaction being executed and/or implemented or might reasonably be expected to delay such transaction. Without derogating from the generality of the foregoing, Licensee undertakes to assign or to license all its right, title and interest to the Licensee Cannabis IP (as defined below) to Pharmedica or such Third Party Company, as may be required by Pharmedica, for reasonable consideration.

 

 
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3. DILIGENCE

 

3.1 Licensee shall, at its own expense, exert continuing best efforts to develop and commercialize the Licensed Product.

 

3.2 Furthermore, Licensee shall be required to meet the development, regulatory and sales milestones set forth in Annex C attached hereto by the respective dates set forth therein. For avoidance of doubt, failure to meet any of the aforesaid milestones shall entitle Pharmedica to terminate the License.

 

3.3 Licensee shall perform its obligations hereunder in accordance with all applicable laws and regulations, and shall procure the receipt of all approvals and consents necessary for the performance of its obligations under the terms hereof.

 

3.4 At the end of each calendar quarter, Licensee shall provide Pharmedica with a sales report and once yearly Licensee shall provide Pharmedica with written progress reports of its activities, which reports shall include detailed descriptions of the progress and results, if any, of: (i) the tests and trials conducted; (ii) manufacturing of the Licensed Product, (iii) the status of sublicensing and sales as well as (iv) details of new clinical and regulatory data developed pursuant hereto, and any adverse events.

 

4. Financial Provisions

 

4.1 License Fee . Licensee shall pay Pharmedica a license fee of $100,000, payable as follows: (A) $50,000 (fifty thousand US dollars) shall be paid within three (3) days of the Effective Date and (B) $50,000 (fifty thousand US dollars) shall be paid within three (3) days of Licensee’s first receipt of an acceptable quote from Dr. Hock Tan of Bionex Pharmaceuticals, Inc (“ Bionex ”), related to the Licensed Product or the development thereof. .

 

4.2 Royalties . Licensee shall pay Pharmedica annual royalties at a rate of five percent (5%) of the Net Sales of the Licensed Product (“ Royalties ”).

 

4.3 Minimum Royalties . As of the first anniversary of the Effective Date, in the event that the Royalties payable in respect of any calendar year are less than $50,000 (the “ Minimum Annual Royalty ”), Licensee shall pay, in addition to the Royalties, an amount equal to the difference between such amount and the Minimum Annual Royalty within ninety (90) days of the end of the applicable calendar year. In the event that this Agreement is terminated by either party for any reason before the end of any calendar year, the Minimum Annual Royalty due for such year, if any, shall be prorated based on the proportion of the year elapsed prior to the effective date of such termination.

 

4.4 Sublicense Fees . In addition, Licensee shall pay Pharmedica five percent (5%) of Sublicense Receipts in addition to seven and one half percent (7.5%) of the proceeds of any sale of the Licensee (“ Sublicense Fees ”).

 

 
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4.5 Reports . As of the First Commercial Sale, and for the duration of the Agreement, Licensee shall submit to Pharmedica, no later than forty-five days (45) after the end of each quarter, quarterly reports detailing the amounts due to Pharmedica pursuant hereto, and detailing the Net Sales made by Licensee and its Affiliates and Sublicensees during such period. Such reports shall also detail the quantities of Licensed Products sold, applicable offsets (on a gross basis) and withholding taxes.

 

4.6 Payment . Royalties payable to Pharmedica shall be paid on a quarterly basis, no later than thirty (30) days after the end of each calendar quarter, and Sublicense Fees shall be paid within seven (7) days of receipt of the applicable Sublicense Receipts; all by wire transfer of immediately available funds to an account designated by Pharmedica in writing. With respect to sales of Products in foreign currency on which any Royalties are payable hereunder, conversions to U.S. dollars shall be made based on interbank (official) rates as reported on www.oanda.com as of the first business day of the month in which the payment is to be made.

 

4.7 Audit . Licensee shall maintain, and shall cause its Affiliates and Sublicensees to maintain, complete and accurate records of amounts payable to Pharmedica in relation to Licensed Products, which records shall contain information to reasonably permit Pharmedica to confirm the accuracy of any reports or payments to Pharmedica under this Agreement. All such records shall be retained for at least five (5) years after the conclusion of the applicable calendar year, during which time Pharmedica shall have the right, at its expense, to cause an independent, certified public accountant to inspect such records during normal business hours for the sole purpose of verifying any reports and payments delivered under this Agreement. The parties shall reconcile any underpayment or overpayment within thirty (30) days after such accountant delivers the results of the audit. In the event that any audit reveals an underpayment in excess of five percent (5%), then Licensee shall bear the full cost of such audit.

 

5. RESERVED

 

6. TITLE

 

6.1 Existing Technology . Other than as explicitly set forth in this Agreement, nothing in this Agreement shall be construed as granting either Party any right or license to the other Party’s existing Intellectual Property Rights as of the Effective Date or in Derivative Works thereof.

 

6.2 Pharmedica IP . All Pharmedica IP will be owned exclusively by Pharmedica and shall be subject to the License granted hereunder.

 

6.3 New IP . All Intellectual Property Rights embodied in and/or related to the Licensed Product(s), all marketing materials and all related data and know-how, and all Intellectual Property Rights generated, made, conceived, developed, or reduced to practice, after the Effective Date hereof and related to the Licensed Product, including any improvements or modifications to the Pharmedica IP, shall be exclusively owned by Pharmedica and deemed included in the definition of Pharmedica IP (even if same were developed or reduced to practice by or on behalf of Licensee).

 

Notwithstanding the foregoing, any such newly developed IP developed or reduced to practice solely by or on behalf of Licensee specifically for use in the delivery of medicinal or recreational cannabis, where latter permitted (“ Licensee Cannabis IP ”) shall be owned by the Licensee, and Pharmedica shall have a perpetual, non-exclusive royalty-free license to exploit same at its discretion.

 

 
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6.4 Assistance Regarding IP . Each Party hereto undertakes to sign, execute and deliver all documents and papers that may be required, and perform such other acts as may be reasonably required in the circumstances, in order to ensure the allocation of the intellectual property rights between the Parties in accordance with the terms of this Section.

 

7. PROSECUTION AND PROTECTION OF INTELLECTUAL PROPERTY

 

7.1 Patent Filing and Prosecution. Pharmedica shall be responsible for the filing, prosecution and maintenance of all patents and patent applications included in the Pharmedica IP and/or related to the Licensed Product.

 

7.2 Patent Enforcement. Each of Pharmedica and Licensee shall promptly notify the other if it knows or has reason to believe that any of the rights to the Pharmedica IP and/or related to the Licensed Product are being infringed or misappropriated by a third party or that such infringement or misappropriation is threatened. The parties shall consult with each other as promptly as reasonably practicable to review actions to be taken in connection with such alleged infringement or misappropriation.

 

Only Pharmedica shall be entitled to take action to alleviate any such alleged or threatened infringement or misappropriation at its sole discretion.

 

In case of such action, Licensee will fully cooperate with Pharmedica with respect to the investigation and prosecution of such alleged infringement or misappropriation including the eventual joining of Licensee as a party to such action, if so required by the law of the particular forum where enforcement is being sought. Any recovery obtained as a result of such enforcement action shall be applied first to the documented legal fees and other costs actually incurred in connection with the action, and the remainder of such recoveries shall be retained by Pharmedica.

 

7.3 Defense against Claims of Infringement. In the event that during the term of this Agreement a suit or action is brought against either Pharmedica or Licensee, or both of them, by a third party alleging that the commercialization of the Licensed Products infringes upon any Intellectual Property Rights of such third party the Party being so sued shall immediately give the other Party notice of same.

 

Licensee shall have the first right, but not the obligation, to defend against such action, on behalf of both Parties, within the appropriate time, and any expenses or costs incurred by Licensee in connection with such action(s), and any costs or amounts awarded to the counterparties in such action(s), shall be fully borne by Pharmedica and any recovery in such action shall be applied first to the documented legal fees and other costs actually incurred by Pharmedica in connection with the action, and the remainder of such recoveries shall be retained by Pharmedica.

 

In the event that Licensee does not exercise its right to so defend as set forth above, then Pharmedica shall be entitled to defend against such claim at its own cost and expense and any recovery in such action shall be retained by Pharmedica in full. In addition, and without derogating from Pharmedica’s other rights and remedies, in such event that Pharmedica defends against such claim, Pharmedica shall have the right to terminate the License in accordance with the provisions of Section 12.3(i) [termination for breach] .

 

 
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7.4 Under no circumstances shall Licensee challenge or attempt to invalidate, directly or indirectly, the validity of any of the Pharmedica Patents during the term of this Agreement or at any time thereafter.

 

7.5 In no event shall either Party when defending the other party, enter into any settlement, consent order, consent judgment or any voluntary disposition of such action that would adversely affect the rights of the other without the prior written consent of such other Party, which consent shall not be unreasonably withheld.

 

8. WARRANTIES AND REPRESENTATIONS

 

8.1 Each Party hereby warrants that (i) it has the full power and authority to enter into this Agreement and to convey the rights herein conveyed; (ii) entering this Agreement and performance hereof shall not constitute a breach of any agreement, contract, understanding and/or obligation, or any third party rights including its documents of incorporation that it is currently bound by; (iii) it shall perform its obligations hereunder diligently, expeditiously and to the best of its abilities; and (iv) it has the financial capacity, as well as the necessary experience and expertise, to carry out all its obligations hereunder, and that in carrying out its undertakings and responsibilities pursuant to this Agreement, it shall obtain or procure all necessary approvals and consents and shall comply with all applicable laws and regulations, licenses, permits, and approvals.

 

8.2 Pharmedica further warrants that to its knowledge, no third party has provided Pharmedica with written notice contesting the ownership or validity of the Pharmedica IP.

 

9. INDEMNIFICATION; LIMITATION OF LIABILITY

 

9.1 Licensee shall defend, indemnify and hold Pharmedica, its Affiliates, and the officers, directors and employees and consultants of each of them, harmless from and against any losses, costs, damages, fees or expenses (including reasonable attorneys fees) suffered by them relating to (i) any breach by Licensee of its obligations hereunder or (ii) any activities conducted by or for Licensee under this Agreement, or (iii) any product liability claims related to the Licensed Product or the marketing or sale thereof.

 

9.2 EXCEPT AS OTHERWISE REQUIRED BY APPLICABLE LAW, IN NO EVENT SHALL PHARMEDICA BE LIABLE TO LICENSEE OR ANY OF ITS AFFILIATES OR SUBLICENSEES FOR ANY CONSEQUENTIAL, INCIDENTAL, INDIRECT, SPECIAL, PUNITIVE OR EXEMPLARY DAMAGES (INCLUDING, WITHOUT LIMITATION, LOST PROFITS, BUSINESS OR GOODWILL) SUFFERED OR INCURRED BY LICENSEE OR ANY OF ITS AFFILIATES OR SUBLICENSEES, WHETHER BASED UPON A CLAIM OR ACTION OF CONTRACT, WARRANTY, NEGLIGENCE OR TORT, OR OTHERWISE, ARISING OUT OF THIS AGREEMENT.

 

10. CONFIDENTIALITY

 

10.1 Other than as expressly set forth herein, Licensee and Pharmedica undertake to treat and to maintain and to ensure that their Representatives (as defined below) shall treat and maintain, in strict confidence and secrecy any information disclosed by the other Party prior to the Effective Date or thereafter under this Agreement, whether disclosed in oral or visual form or in writing and shall keep in confidence the existence and contents of this Agreement (the “ Confidential Information ”) and shall not disclose, publish, or disseminate in any manner, any Confidential Information to a third party other than those of its Representatives with a need to know same for the purpose of performing its obligations under this Agreement. In addition, each Party shall undertake to treat and maintain (and to ensure that its Representatives treat and maintain) in strict confidence and secrecy and to prevent any unauthorized use, disclosure, publication, or dissemination of the Confidential Information, except for the purpose of complying with this Agreement. Each Party agrees to be responsible for any use or disclosure of Confidential Information of any of its said Representatives. It is clarified that the Pharmedica IP and any IP subject to the provisions of Section 6.3 above shall constitute Pharmedica’s Confidential Information.

 

 
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10.2 Each Party shall: (i) safeguard and keep secret all Confidential Information, and will not directly or indirectly disclose to any third party the Confidential Information without written permission of the other; and (ii) in performing its duties and obligations hereunder, use at least the same degree of care as it does with respect to its own confidential information of like importance but, in any event, at least reasonable care.

 

10.3 The undertakings and obligations under this Section 10 shall not apply to any part of the Confidential Information which:

 

(a) was known to the recipient of the Confidential Information (“ Recipient ”) prior to disclosure by the disclosing Party (“ Discloser ”);

 

(b) was generally available to the public prior to disclosure to the Recipient;

 

(c) is disclosed to Recipient by a third party who is not bound by any confidentiality obligation, having a legal right to make such disclosure;

 

(d) has become through no act or failure to act on the part of the Recipient public information or generally available to the public; or

 

(e) is required to be disclosed by Recipient by law, by court order, or governmental regulation (including securities laws and/or exchange regulations), provided that the Recipient gives Discloser reasonable notice prior to any such disclosure and cooperates (at Discloser’s expense) with Discloser to assist Discloser in obtaining a protective order or other suitable protection from disclosure (if available) with respect to such Confidential Information and discloses the minimum required by such order.

 

10.4 Licensee and Pharmedica acknowledge that the respective Confidential Information is of special and unique significance to each of them and that any unauthorized disclosure or use of the Confidential Information could cause irreparable harm and significant injury to the Discloser that may be difficult to ascertain. Accordingly, any breach of this Agreement may entitle the aggrieved Party in addition to any other right or remedy that it may have available to it by law or in equity, to remedies of injunction, performance and other relief, including recourse in a court of law.

 

 
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10.5 The provisions relating to confidentiality in this Section 10 shall remain in effect during the term of this Agreement and for a period of ten (10) years after its termination.

 

10.6 Representatives ” shall mean employees, officers, agents, subcontractors, consultants, and/or any other person or entity acting on either Party’s behalf, individually or collectively and which shall be exposed to Confidential Information.

 

11. PUBLICATION

 

Neither Party shall issue any press release, make any public statement or advertise any information pertaining to this Agreement, or to the collaboration hereunder, without the prior written approval of the other, except as required by applicable law. Without derogating from the foregoing, disclosure required under applicable law and regulations shall not be subject to the written consent of the other Party, however the disclosing party shall give the other sufficient notice, as far as practicable under law, of such required disclosure as to enable the non-disclosing Party time to object to such disclosure.

 

12. TERM AND TERMINATION

 

12.1 This Agreement is subject to the approval of the Board and Shareholders of the Company, and in the event such approval is not obtained within 30 days as of the signing hereof, this Agreement shall be null and void ab initio and any payments made hereunder shall be returned.

 

12.2 This Agreement shall be effective from the date of signature of the last signing party to the Agreement (the “ Effective Date ”) and shall continue in full force and effect subject to Section 12.1 above, unless earlier terminated, in accordance with this Section 12.

 

12.3 Without derogating from any other remedies that any Party hereto may have under the terms of this Agreement or at law, each Party hereto shall have the right to terminate this Agreement forthwith upon the occurrence of any of the following:

 

(i) the commission of a material breach by the other Party hereto of its obligations hereunder, and such other Party’s failure to remedy such breach to the reasonable satisfaction of the other Party within thirty (30) days after being requested in writing to do so; or

 

(ii) the other party’s liquidation, whether voluntarily or otherwise, or if it makes an assignment for the benefit of creditors.

 

12.4 Upon termination of this Agreement by Pharmedica pursuant to the provisions of Section 12.3 (ii) above [Licensee’s liquidation] , all right, title and interest in and to the Licensee Cannabis IP shall automatically be assigned, and is hereby assigned, to Pharmedica for no further consideration.

 

12.5 The termination of this Agreement for any reason shall not relieve either Party hereto of any obligations which shall have accrued prior to such termination.

 

12.6 The following provisions of this Agreement shall survive the termination or expiration hereof: 1, 4.7, 6, 7.1, 7.2, 7.4, 7.5, 9, 10, 11, 12.4, 12.5, 12.6, 14 and 15.

 

 
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13. INSURANCE

 

Each Party hereto shall maintain, for the term of this Agreement and thereafter, insurance sufficient to cover its obligations under this Agreement and under law.

 

14. Jurisdiction

 

This Agreement shall be governed by and construed in accordance with the laws of the State of Israel. The Parties hereto hereby consent to the exclusive jurisdiction of the appropriate court of Tel Aviv-Jaffa with respect to any matter related to this Agreement.

 

15. MISCELLANEOUS

 

15.1 The headings in this Agreement are intended solely for convenience or reference and shall be given no effect in the interpretation of this Agreement.

 

15.2 This Agreement (including the Annexes attached hereto) constitutes the entire agreement between the Parties with respect to its subject matter and supersede all prior agreements, arrangements, dealings or writings between the Parties.

 

15.3 This Agreement may be executed in any number of counterparts (including counterparts transmitted by fax), each of which shall be deemed to be an original, but all of which taken together shall be deemed to constitute one and the same instrument.

 

15.4 Neither Party hereto may assign its rights and/or obligations hereunder in whole or in part, without the prior written consent of the other Party hereto, provided that either Party shall be entitled, at any time, to assign this Agreement to an Affiliate of such Party or to a party which acquires all or substantially all of that party’s business related to this Agreement, whether by merger, sale of assets or otherwise, provided that the assigning Party shall guarantee performance of any and all financial liabilities hereunder by such transferee.

 

15.5 No waiver of a breach or default hereunder shall be considered valid unless in writing and signed by the Party giving such waiver and no such waiver shall be deemed a waiver of any subsequent breach or default of the same or similar nature. No failure by any party hereto to take any action against any breach of this Agreement or default by another party hereto shall constitute a waiver of the former party’s rights to enforce any provision of this Agreement or to take action against such breach or default or any subsequent breach or default by such other party.

 

15.6 Should any part or provision of this Agreement be held unenforceable or in conflict with the applicable laws or regulations of any applicable jurisdiction, the invalid or unenforceable part or provision shall, provided that it does not go to the essence of this Agreement, be replaced with a revision which accomplishes, to the extent possible, the original commercial purpose of such part or provision in a valid and enforceable manner, and the balance of this Agreement shall remain in full force and effect and binding upon the Parties hereto.

 

15.7 This Agreement shall make neither Licensee nor Pharmedica the agent or legal representative of the other. Each Party shall be an independent contractor, not an employee or partner of the other Party, and the manner in which each Party renders its services under this Agreement shall be within its sole discretion. Neither Licensee nor Pharmedica is granted any right or authority to assume or to create any obligation or responsibility, express or implied, on behalf of or in the name of the other, with regard to any manner or thing whatsoever, unless otherwise specifically agreed upon in writing.

 

 
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15.8 Each Party agrees to execute, acknowledge and deliver such further documents and instruments and do any other acts, from time to time, as may be reasonably necessary, to effectuate the purposes of this Agreement.

 

15.9 None of the provisions of this Agreement shall be enforceable by any person who is not a party to this Agreement.

 

15.10 The remedies afforded to any of the parties hereto, whether hereunder, or under applicable law or otherwise, shall be cumulative in nature and not alternative.

 

15.11 Force Majeure . Neither party shall be responsible to the other for failure or delay in performing any of its obligations under this Agreement or for other non-performance hereof but only to the extent that such delay or non-performance is occasioned by a cause beyond the reasonable control and without fault or negligence of such party, including, but not limited to earthquake, fire, flood, explosion, discontinuity in the supply of power, court order or governmental interference, strikes, act of God, strike or other labor trouble, act of war or terrorism and provided that such party will inform the other party as soon as is reasonably practicable and that it will entirely perform its obligations immediately after the relevant cause has ceased its effect.

 

15.12 Notice, declaration or other communication required or authorized to be given by any Party under this Agreement to any other Party shall be in writing and shall be personally delivered, sent by facsimile transmission (with a copy by ordinary mail in either case) or dispatched by courier addressed to the other Party at the address stated below or such other address as shall be specified by the Parties hereto by notice in accordance with the provisions of this Section. Any notice shall operate and be deemed to have been served, if personally confirmed as delivered, successfully sent by fax or by delivered by courier on the next following business day. Licensee’s and Pharmedica’s addresses for the purposes of this Agreement shall be as follows:

 

Green C Corporation : 1 Whitehorse Road, Unit 16, Toronto, Ontario M3J 3G8

 

Tel: 416-661-0728; Attn: Elisha Kalfa; E-mail: elisha@focusglobalsupply.com

 

Pharmedica : 9 Andre Saharov, Matam, Building #25, Haifa 508409, Tel: +(972) 04 8342155; Fax: +(972) 04 8341233 Attn: Dr. Yoram Rubin, CEO E-mail yrubin@pharmedica.co.il

 

with a copy (which shall not constitute notice) to: Tulchinsky Stern Marciano Cohen Levitski & Co., 4 Berkowitz Street, Museum Tower, 12th Floor, Tel-Aviv 6423806, Fax: +972-3-607-5050, Attn: Adv. Alon Tabak Aviram; Email: alont@tslaw.co.il.

 

 
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IN WITNESS WHEREOF , each of the Parties has executed this Agreement and the Annexes hereto.

  

Green C Corporation   PHARMEDICA LTD.
     
signature:   signature:
     
name:   name:
     
designation:   designation:
     
date:   date:
     

 

 
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Annex A – Description of Patch

 

A “Eluting Transmucosal Patch Platform (ETP)” for non-invasive drug delivery.

 

 
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Annex B – Patent(s)/Patent Application(s)

 

1. WO 2012/104834 A1

 

New oral dissolving films for insulin administration, for treating diabetes.

 

filed on December 2011. National Phase at Israel and the USA.

 

2. WO 2010/135053 A2

 

Dual and single layer dosage forms.

 

Issued USA patent on April 28, 2015.

 

3 . PCT/IL 2017/050845

 

Adhesive Oral dissolved Films in Managing Oral Care.

 

PCT on 31 July 2017.

 

 
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Annex C – Diligence Milestones

 

Licensee is required to meet the following development/regulatory/commercialization milestones in order to retain the license:

 

  Successful completion of the development of product samples by the end of year 1, provided there are no delays which are under the control of Licensee, its Affiliates or Subcontractors and any such delays not under their control will be deemed to extend such period, commensurate with such delay.
     
  Successful completion of product scale-up and receipt of regulatory marketing approval by the end of year 3, provided there are no delays which are under the control of Licensee, its Affiliates or Subcontractors and any such delays not under their control will be deemed to extend such period, commensurate with such delay.
     
  First commercial sale by the end of year 3 in any of the following territories: US, Canada, Japan, western Europe, provided there are no delays which are under the control of Licensee, its Affiliates or Subcontractors and any such delays not under their control will be deemed to extend such period, commensurate with such delay.
     
  $50,000 in annual sales each year from years 5-9
     
  $100,000 in annual sales each year from year 10 onwards