EXCHANGE AGREEMENT

 

This Exchange Agreement (this “Agreement”) is entered into as of February 14,
2019, by and among The Greater Cannabis Company, Inc., a Florida corporation
(the “Company”) and Emet Capital Partners LLC (“Investor”).

 

WHEREAS, the Company issued to the Investor warrant to purchase the Company’s
common stock purchase warrants identified on Schedule A (the “Warrants” and
designated W1 through W4 as set forth on Schedule A);

 

WHEREAS, the Investor has partially exercised the Warrants.

 

WHEREAS, the Company desires to exchange the Warrants (the “Surrendered
Securities”) for 9,000,000 Shares of Series B Convertible Preferred Stock (the
“Preferred Shares”) which shall be convertible into shares of the Company’s
common stock pursuant to the terms of the Certificate of Designation annexed
hereto as Exhibit A (the “Certificate of Designation”). Capitalized terms not
otherwise defined herein shall have the meaning set forth in the Certificate of
Designation.

 

NOW, THEREFORE, in consideration of the rights and benefits that they will each
receive in connection with this Agreement, the parties, intending to be legally
bound, agree as follows:

 

1. Exchange. The Company and Investor agree to exchange the Surrendered
Securities for the Preferred Shares (the “Exchange”). The Preferred Shares shall
be issued pursuant to an exemption from registration under Section 3(a)(9) of
the Securities Act, as amended. The Preferred Shares shall be issued in four
tranches: one for 6,020,066 Preferred Shares (“C1”), one for 1,505,017 Preferred
Shares (“C2”), one for 1,324,415 Preferred Shares (“C3”), one for 150,502
Preferred Shares (“C4”). C1 is being exchanged for W1, C2 is being exchanged for
W2, C3 is being exchanged for W3, and C4 is being exchanged for W4. For the
avoidance of doubt, it is agreed that upon the consummation of the transactions
contemplated by the Exchange, the Warrants and any other warrants issued to the
Investor by the Company outstanding immediately prior to the Exchange, will be
null, void and of no further force and effect.

 

2. Tacking. The Company acknowledges that the Investor’s holding period of the
Preferred Shares shall tack, for Rule 144 purposes, as follows: the Preferred
Shares represented by C1 shall tack back to May 25, 2017, the Preferred Shares
represented by C2 shall tack back to September 14, 2017, the Preferred Shares
represented by C3 shall tack back to March 28, 2018, and the Preferred Shares
represented by C4 shall tack back to June 13, 2018.

 

3. Disclosure Obligations. The Company shall, file a form 8K disclosing this
transaction within one (1) business day following the execution of this
agreement, disclosing the material terms of the transactions contemplated
hereby.

 

4. Closing Conditions. The Closing of the exchange shall occur upon the
following conditions being met: (i) the Company shall have a class of stock
registered under Section 12(b) or 12(g) of the Securities Exchange Act of 1934
no later than February 14, 2019; (ii) the Company shall have made any necessary
amendment to its articles of incorporation and filed the Certificate of
Designation with the Florida secretary of state no later than February 22, 2019;
(iii) the Company shall have delivered confirmation from its transfer agent that
C1, C2, C3, and C4 are being held by the transfer agent in book entry registered
to the Investor; and (iv) the Company shall not have defaulted under the terms
of this Agreement.

 

   

 

 

5. Other Deliverables. The Company shall also deliver to the Investor a letter
signed by the company and acknowledged by its transfer agent in the form annexed
hereto as Exhibit B and a copy of the resolution of the Company’s board of
directors approving the transactions contemplate by this agreement and the
issuance of the Preferred Shares and chares of the Company’s common stock upon
conversion of the Preferred Shares.

 

6. Representations and Warranties of the Company. The Company hereby represents
and warrants to each Investor as of the date hereof as follows:

 

(a) Organization and Standing. The Company is a corporation duly organized,
validly existing under, and by virtue of, the laws of Florida, and is in good
standing under such laws. The Company has all requisite corporate power and
authority to own and operate its properties and assets and to carry on its
business as presently conducted. The Company is duly qualified and authorized to
transact business and is in good standing as a foreign corporation in each
jurisdiction in which the failure to so qualify would have a material adverse
effect on its business, properties or financial condition.

 

(b) Corporate Power. The Company has all requisite legal and corporate power and
authority to execute and deliver this Agreement, to issue the Preferred Shares
and Conversion Shares hereunder, and to carry out and perform its obligations
under the terms of this Agreement and the transactions contemplated hereby.

 

(c) Authorization. All corporate action on the part of the Company, its
officers, directors and stockholders necessary for the authorization, execution,
delivery and performance of this Agreement, the authorization, sale, issuance
and delivery of the Preferred Shares and the performance of all of the Company’s
obligations hereunder have been taken or will be taken prior to the Closing.
This Agreement has been duly executed by the Company and constitutes valid and
legally binding obligations of the Company, enforceable against the Company in
accordance with their respective terms, subject to the laws of general
application relating to bankruptcy, insolvency and the relief of debtors and
rules of law governing specific performance, injunctive relief or other
equitable remedies.

 

   

 

 

(d) Offering. Subject in part on the accuracy of the Investor’s representations
herein, the offer, sale and issuance of the Preferred Shares in conformity with
the terms of this Agreement constitute transactions exempt from registration of
under the Securities Act of 1933, as amended (the “Securities Act”) and from all
applicable state securities laws. The sole consideration for the issuances of
the Preferred Shares is the Investor’s surrender of the Warrants.

 

7. Representations and Warranties of the Investor. Investor hereby represents
and warrants as of the date hereof to the Company as follows:

 

(a) Organization and Standing. The Investor is either an individual or an entity
duly organized, validly existing under, and by virtue of, the laws of the
jurisdiction of its incorporation or formation, and is in good standing under
such laws.

 

(b) Corporate Power. The Investor has all right, corporate, partnership, limited
liability company or similar power and authority to execute and deliver this
Agreement and to carry out and perform its obligations under the terms of this
Agreement and the transactions contemplated hereby.

 

(c) Authorization. All corporate, partnership, limited liability company or
similar action, as applicable on the part of such Investor, necessary for the
authorization, execution, delivery and performance of this Agreement and the
performance of all of such Investor’s obligations hereunder have been taken or
will be taken prior to the Closing. This Agreement has been duly executed by the
Investor and constitutes valid and legally binding obligations of such Investor,
enforceable against such Investor in accordance with their respective terms,
subject to the laws of general application relating to bankruptcy, insolvency
and the relief of debtors and rules of law governing specific performance,
injunctive relief or other equitable remedies.

 

(d) Own Account. Investor is acquiring the Preferred Shares for its own account.

 

   

 

 

(e) Investor Status. The Investor is either: (i) an “accredited investor” as
defined in Rule 501(a)(1), (a)(2), (a)(3), (a)(7) or (a)(8) under the Securities
Act or (ii) a “qualified institutional buyer” as defined in Rule 144A under the
Securities Act. Such Investor is not required to be registered as a
broker-dealer under Section 15 of the Securities Exchange Act of 1934, as
amended (the “Exchange Act”).

 

(f) Warrants. To the best of Investor’s knowledge, the Warrants listed on
Schedule A represent all warrants issued by the Company to the Investor.

 

8. No Short Sales. Investor, its successors, assigns and affiliates, agrees that
so long any Preferred Shares remain outstanding, Investor and its affiliates
shall not enter into or effect “short sales” of the common stock of the Company
or hedging transaction which establishes a short position with respect to the
common stock of the Company. The Company acknowledges and agrees that upon
delivery of a Conversion Notice by the Investor, the Investor immediately owns
the shares of common stock described in the Conversion Notice and any sale of
those shares issuable under such Conversion Notice would not be considered short
sales.

 

9. Miscellaneous.

 

(a) Entire Agreement. This Agreement, together with the schedules attached
hereto, contain the entire understanding of the parties with respect to the
subject matter hereof and supersede all prior agreements and understandings,
oral or written with respect to such matters.

 

(b) Notices. All notices, demands requests, consents, approvals, and other
communications required or permitted hereunder shall be in writing and, unless
otherwise specified herein, shall be (i) personally served, (ii) deposited in
the mail, registered or certified, return receipt requested, postage prepaid,
(iii) delivered by reputable air courier service with charges prepaid, or (iv)
transmitted by hand delivery, telegram or facsimile, addressed as set forth
below or to such other address as such party shall have specified most recently
by written notice. Any notice or other communication required or permitted to be
given hereunder shall be deemed effective (a) upon hand delivery or delivery by
facsimile, with accurate confirmation generated by the transmitting facsimile
machine, at the address or number designated below (if delivered on a business
day during normal business hours where such notice is to be received), or the
first business day following such delivery (if delivered other than on a
business day during normal business hours where such notice is to be received)
or (b) on the second business day following the date of mailing by express
courier service, fully prepaid, addressed to such address, or upon actual
receipt of such mailing, whichever shall occur first.

 

(c) Amendments; Waivers. No provision of this Agreement may be waived, modified,
supplemented or amended except in a written instrument signed, in the case of an
amendment, by the Company and the Investor, in the case of a waiver, by the
party against whom enforcement of any such waived provision is sought. No waiver
with respect to any provision, condition or requirement of this Agreement shall
be deemed to be a continuing waiver in the future or a waiver of any other
provision, condition or requirement hereof, nor shall any delay or omission of
any party to exercise any right hereunder in any manner impair the exercise of
any such right.

 

(d) Headings. The headings herein are for convenience only, do not constitute a
part of this Agreement and shall not be deemed to limit or affect any of the
provisions hereof.

 

(e) Successors and Assigns. This Agreement shall be binding upon and inure to
the benefit of the parties and their successors and permitted assigns.

 

(f) No Third-Party Beneficiaries. This Agreement is intended for the benefit of
the parties hereto and their respective successors and assigns, and is not for
the benefit of, nor may any provision hereof be enforced by, any other Person.

 

(g) Governing Law. All questions concerning the construction, validity,
enforcement and interpretation of this Agreement and the transactions
contemplated hereby shall be governed by and construed and enforced in
accordance with the internal laws of the State of New York, without regard to
the principals of conflicts of law thereof. Each party agrees that all legal
proceedings concerning the interpretations, enforcement and defense of the
transactions contemplated by this Agreement (whether brought against a party
hereto or its respective affiliates, directors, officers, shareholders,
partners, members, employees or agents) shall be commenced exclusively in the
state and federal courts sitting in the City of New York. Each party hereby
irrevocably submits to the exclusive jurisdiction of the state and federal
courts sitting in the City of New York, Borough of Manhattan for the
adjudication of any dispute hereunder or in connection herewith or the
transaction contemplated hereby or discussed herein, and hereby irrevocably
waives, and agrees not to assert in any suit, action or proceeding, any claim
that it is not venue for such proceeding. Each party hereby irrevocably waives
personal service of process and consents to process being served in any such
suit, action or proceeding by mailing a copy thereof via registered or certified
mail or overnight delivery (with evidence of delivery) to such party at the
address in effect for notices to it under this Agreement and agrees that such
service shall constitute good and sufficient service of process and notice
thereof.

 

(h) Survival. The representations and warranties contained herein shall survive
the Closing for the applicable statute of limitations.

 

(i) Execution. This Agreement may be executed in one or more counterparts, all
of which when taken together shall be considered one and the same agreement, it
being understood that the parties need not sign the same counterpart. In the
event that any signature is delivered by facsimile transmission or by email
delivery of a “.pdf” format data file, such signature shall create a valid and
binding obligation of the party executing (or on whose behalf such signature is
executed) with the same force and effect as if such facsimile or “.pdf”
signature was an original thereof.

 

(j) Severability. If any term, provision, covenant or restriction of this
Agreement is held by a court of competent jurisdiction to be invalid, illegal,
void or unenforceable, the remainder of the terms, provisions, covenants and
restrictions set forth herein shall remain in full force and effect and shall in
no way be affected, impaired or invalidated, and the parties hereto shall use
their commercially reasonable efforts to find and employ, an alternative means
to achieve the same or substantially the same result as that contemplated by
such term, provision, covenant or restriction. It is hereby stipulated and
declared to be the intention of the parties that they would have executed the
remaining terms, provisions, covenants and restrictions without including any of
such that may be hereafter declared invalid, illegal, void or unenforceable.

 

(k) Construction. The parties hereto agree that each of them and/or their
respective counsel have reviewed and have had an opportunity to revise this
Agreement and the schedules attached hereto. This Agreement shall be construed
according to its fair meaning and not strictly for or against any party. The
word “including” shall be construed to include the words “without limitation.”
In this Agreement, unless the context otherwise requires, references to the
singular shall include the plural and vice versa.

 

(l) WAIVER OF JURY TRIAL. IN ANY ACTION, SUIT OR PROCEEDING IN ANY JURISDICTION
BROUGHT BY ANY PARTY AGAINST ANY OTHER PARTY, THE PARTIES EACH KNOWINGLY AND
INTENTIONALLY, TO THE GREATEST EXTENT PERMITTED BY APPLICABLE LAW, HEREBY
ABSOLUTELY, UNCONDITIONALLY, IRREVOCABLY AND EXPRESSLY WAIVES FOREVER TRAIL BY
JURY.

 

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IN WITNESS WHEREOF, the parties have caused this Exchange Agreement to be duly
executed and delivered as of the date and year first written above.

 

  COMPANY     The Greater Cannabis Company, Inc.             By:     Its:      
      INVESTOR     Emet Capital Partners LLC             By:     Its:    

 

Schedule A

Warrants

All outstanding warrants, including:

 

  1. A warrant to initially purchase 440,000 shares dated May 25, 2017 (“W1”);  
2. A warrant to initially purchase 110,000 shares dated September 14, 2017
(“W2”);   3. A warrant to initially purchase 96,800 shares dated March 28, 2018
(“W3”); and   4. A warrant to initially purchase 11,000 shares dated June 13,
2018 (“W4”).

 

Copies of the Warrants are annexed hereto as Schedule B.

 

   

 

 

Schedule B

 

Copy of warrant to initially purchase 440,000 shares dated May 25, 2017 (“W1”)

 

   

 

 

Copy of warrant to initially purchase 110,000 shares dated September 14, 2017
(“W2”)

 

   

 

 

Copy of warrant to initially purchase 96,800 shares dated March 28, 2018 (“W3”)

 

   

 

 

Copy of warrant to initially purchase 11,000 shares dated June 13, 2018 (“W4”)