EXHIBIT 10.9

 

LOAN AGREEMENT

 

THIS LOAN AGREEMENT (this “Agreement”) by and between Medmar LLC., a legal
entity constituted under the laws of the State of Maryland, USA (“Medmar” or
“Lender”) and One World Cannabis Ltd., a company organized under the laws of the
State of Israel (“OWC” or “Borrower”) , duly executed and delivered on this 28th
day of September, 2016, is, effective as of September 22, 2016 (the “Effective
Date”).

 

Whereas, on March 17, 2016, Medmar and OWC executed a consulting and license
agreement (the “License Agreement”), pursuant to which, inter alia, OWC granted
to Medmar an exclusive, non-transferable, royalty-bearing license, to
manufacture, produce, publicize, promote and market the Licensed Products (as
defined in the License Agreement) in the State of Maryland, against payment by
Medmar to OWC of a running royalty;

 

Whereas, on October 11, 2015, Medmar II LLC, an affiliate of Medmar, and OWC
entered into a Memorandum of Understanding with respect to the grant of an
exclusive, non-transferable, royalty-bearing license, to manufacture, produce,
publicize, promote and market the licensed products described therein in the
State of Hawaii and the State of Pennsylvania, subject to the terms set forth
therein;

 

Whereas, on February 8, 2016 Medmar II and OWC executed a right of first refusal
agreement providing Medmar certain right in connection with the
commercialization of Licensed Products in other states in the USA (the “ROFR
Agreement”);

 

Whereas, OWC desires to borrow an amount of up US$300,000 from Medmar in order
to finance its ongoing activities, to be repaid by OWC solely from any royalty
payment on Medmar’s (or any of its affiliate’s) income resulting to Medmar from
the commercialization of any Licensed Products, that may be payable to OWC by
Medmar (or any of its affiliates) pursuant to the agreements executed between
OWC and Medmar as described above (the “Medmar Royalties”), and Medmar is
willing to provide OWC such non-recourse loan, subject to the terms and
conditions of this Agreement.

 

NOW, THEREFORE, the parties agree as follows:

 

1. Loan. Subject to and in accordance with the terms of this Agreement, Medmar
shall lend to OWC and OWC shall borrow from Medmar an amount of US$300,000 (the
“Loan Amount”), to be transferred by Medmar to OWC’s bank account in six equal
installments of US$ 50,000 each, as follows: (i) first installment on September
22, 2016, the receipt of which is hereby acknowledged by OWC; (ii) second
installment on October 1, 2016; (iii) third installment on November 1, 2016;
(iv) fourth installment on December 1, 2016; (v) fifth installment on January 1,
2017; and (vi) sixth installment on February 1, 2017     2. Interest. The Loan
Amount shall bear no interest.     3. Use of Proceeds. Borrower shall use the
Loan Amount to fund its operations.     4. Term of the Agreement. The term of
this Agreement shall be until the Loan Amount is repaid pursuant to the terms
set forth herein (the “Term”). The loan shall be repaid within 36 months from
the Effective Date.     5. Repayment on Demand; Termination; Prepayment.

 

  5.1. At any time during the Term and prior to the full repayment of the Loan
Amount, if and to the extent Medmar is required to pay any Medmar Royalties to
OWC, Medmar shall set off such Medmar Royalties from the outstanding Loan Amount
owed to Medmar by OWC to Medmar pursuant to this Agreement, and such amounts
shall be deemed to be, for any and all purposes, as amounts repaid by OWC on
account of the Loan Amount. It is agreed that notwithstanding any other right of
Medmar under this Agreement, applicable law or otherwise, OWC shall not be
required to pay the Loan Amount other than through the set off from the Medmar
and Medmar II Royalties as described above, and that such loan is a non-recourse
loan, and Medmar has right to be repaid the Loan Amount other than through the
set off from Medmar and Medmar II Royalties. To the extent the Medmar Royalties
are insufficient for any reason in order to fully repay the Loan Amount, Medmar
hereby irrevocable waives any right and/or claim it may have to receive such
full repayment.         5.2 Notwithstanding the above, OWC may, in its sole
discretion, prepay any outstanding   portions of the Loan Amount owed to Medmar,
in whole or in part, at any time.

 

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6. Termination of ROFR Agreement and Exclusivity Rights.

 

  6.1. Subject to the receipt of the entire Loan Amount, Medmar shall receive
the exclusive right to manufacture, produce, publicize, promote and market the
Licensed Products (as defined in the License Agreement) in any state in the USA,
subject to a license agreement to be negotiated and signed between the parties
with respect to any such state (a “State Agreement”), provided that any such
agreement shall include provisions providing the payment to OWC of royalties in
such rate and conditions as set forth in the License Agreement.         6.2. The
right granted to Medmar under Section 6.1 above shall expire, with respect to
each state, within three (3) years from the date on which OWC notifies Medmar
that the Licensed Products are ready for marketing and distribution, if a State
Agreement dealing with the relevant state is not signed between the parties by
such time; or, to the extent such an agreement is signed, the exclusivity right
shall expire in accordance with the provisions of such agreement.         6.3.
The ROFR Agreement is hereby terminated.

 

7. Miscellaneous.

 

  7.1. Further Assurances. Each party shall perform such further acts and
execute such further documents as may reasonably be necessary to carry out and
give full effect to the provisions of this Agreement and the intentions of the
parties as reflected thereby.         7.2. Entire Agreement. This Agreement
constitutes the entire understanding of the parties with respect to the subject
matter hereof. This Agreement may not be amended except by a written agreement
signed by both parties.         7.3. Governing Law. This Agreement shall be
governed by and interpreted in accordance with the laws of the State of New
York, USA (except for its conflict of laws rules). Any legal action or
proceeding against either party with respect to any controversy or claim arising
out of or relating to this Agreement may be brought in the competent courts of
the State of New York, USA located in the City of New York, and, by execution
and delivery of this Agreement, each party hereby irrevocably accepts for itself
and in respect of its property, generally and unconditionally, the jurisdiction
of the aforesaid courts. Each party hereby irrevocably waives any objection
which it may now or hereafter have to the laying of venue of any of the
aforesaid actions or proceedings arising out of or in connection with this
Agreement brought in such courts and hereby further irrevocably waives and
agrees not to plead or claim in any such court that any such action or
proceeding brought in any such court has been brought in an inconvenient forum.

 

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

 

MEDMAR LLC    ONE WORLD CANNABIS LTD.             /s/: Steve Weinstein     /s/:
Ziv Turner Name: Steve Weinstein   Name: Ziv Turner Title: Managing Member  
Title: CEO

  

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