EXHIBIT 10.1

 

MEMORANDUM OF AGREEMENT

 

Between Head North LLC and Indoor Harvest Corp.

 

I. INTRODUCTION

 

This MEMORANDUM OF AGREEMENT (MOA) ("Memorandum"), dated August 22, 2016 between
Head North LLC ("Head North"), with its offices located at 1650 West End Blvd,
Suite 100, St. Louis Park, MN 55416 represented by Nic Quiles, III, Partner and
Senior Vice President of Operations & Acquisitions; and Indoor Harvest Corp
("Indoor Harvest"), a Texas based company, represented by John Choo, President
with its principal place of business at 5300 East Freeway Suite A , Houston TX
77020, collectively referred to as "the Partners". The Partners wish to work
together and in compliance with the following clauses:

 

II. GOAL

 

The parties agree to work together to design, develop and construct a facility
to produce various cannabis related pharmaceutical products as well as develop
specific related intellectual property and to provide an exclusive period of
negotiations to Head North to acquire, in whole, or in part, or enter into a
joint venture for the related intellectual property, know-how and assets of
Indoor Harvest's cannabis related activities and operations.

 

III. AREAS OF COLLABORATION

 

The parties agree that they wish to collaborate on the development of
pharmaceutical cannabis related products and process and wish to explore jointly
applying to become registered with the Drug Enforcement Agency under its newly
expanded research programs for cannabis production related to pharmaceutical
development. Areas of collaboration would include, but not be limited to,
production and process related intellectual property, and research related to
the development of recipes and processes for the production of specific cannabis
chemical expression profiles to treat various medical related conditions.

 

IV. ROLES AND RESPONSIBILITIES OF PARTNERS

 

1) Head North agrees to subscribe a total of THREE HUNDRED SEVENTY FIVE THOUSAND
DOLLARS ($375,000.00 USD) representing:

 

Series A Convertible Preferred Stock shares to Head North, and;

 

Series A Convertible Preferred Stock shares providing the following:

 

·Section 4 provides full dissolution protection. Series A holders are senior to
common stock holders. This means all the assets of the Company go to Series A
holders before common stock holders in the event of a dissolution, liquidation
or winding up.

 

 

·Section 5(iii) provides full ratchet protection to the down side. It provides
Series A investors with down side protection in the event shares are sold
discounted to the purchase price, and;

 

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Series A Warrants provide the following:

 

·Exercisable for a period of 1 year

 

 

·The right, but not the obligation, to convert

 

 

·Conversion into common stock at $0.50., hereby representing;

 

the remaining balance of Indoor Harvest's current Rule 506(b) Series A offering
for $500,000, of which currently $75,000 has been subscribed and $50,000 has
been committed. A subscription related to this commitment would be fully
executed no later than August 26, 2016. Indoor Harvest will use the proceeds
from this offering to repay its existing convertible debt and for general
working capital purposes.

 

2) In return for a fully executed Series A subscription of $375,000.00, Indoor
Harvest will agree to hold off any and all discussions related to the
acquisition, in whole, or in part, or any potential joint venture plans of its
Cannabis Division for a period of 60 days from the date that the Series A
subscription has been fully executed, thereby providing Head North with
exclusive negotiating rights during said period. In order for a subscription
agreement to be fully executed, the funds subscribed must be delivered to Indoor
Harvest's bank account by bank wire.

 

3) Both parties desire to enter into a design-build agreement to deliver a
cannabis pharmaceutical production facility, whereby Indoor Harvest agrees to
provide Head North with the necessary framework to see mutual equity interests
built into the agreement for all parties, as well as reduced hardware costs for
the build-out of the facility. An additional 90 days of exclusivity, to discuss
an acquisition, in whole, or in part, or any potential joint venture of Indoor
Harvest's Cannabis Division will be granted to Head North upon memorializing and
the funding of fair and equitable costs of a Design-Build Agreement. A FIFTY
THOUSAND DOLLAR ($50,000 USD) deposit towards the Design-Build Agreement will be
fully executed no later than October 1, 2016 and placed into en escrow-related
account under the management of Head North for future disbursement to Indoor
Harvest upon the successful negotiations and agreement of terms of the
Design-Build Agreement.

 

4) A press release announcing these plans will be distributed upon delivery and
closing of funds under Section IV.(1) of this agreement.

 

V. PRINCIPAL CONTACTS

 

The Principal Contacts for each one of the organizations is:

 

Head North LLC

Nic Quilles, III

Partner

1650 West End Blvd, Suite 100

St. Louis Park, MN 55416

(414) 640-6299

 

Indoor Harvest Corp

John Choo

President

5300 East Freeway Suite A, Houston Texas 77020, USA

(613) 866-8771

 

Such Principal Contacts may be changed in writing from time to time by their
respective Partners.

 

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VI. USE OF INTELLECTUAL PROPERTY

 

The parties agree that any intellectual property, which is jointly developed and
filed through activities covered under this MOA, can be used by either party for
sales/marketing purposes with the consent of the other party which can be set
forth in initial guidance upon any successful and/or legally binding joint
venture partnership entity or agreement terms being drafted and accepted.

 

All other prior intellectual property used in the implementation of the MOA will
remain the property of the party that created and/or provided said IP. This
property can be used by either party for purposes covered by the MOA but consent
will be obtained from the owner of the property before using it for purposes not
covered by the MOA.

 

VII. EFFECTIVE DATES AND AMENDMENTS.

 

This MOA shall take effect upon signing by both Parties. Neither party may
assign or transfer all or any portion of this MOA without the prior written
consent of the other party.

 

The provisions of this MOA may only be amended or waived by mutual written
agreement by both Parties.

 

The individuals signing this MOA on behalf of their respective entities
represent and warrant (without personal liability therefore) that upon the
signature of each, this MOA shall have been duly executed by the entity each
represents.

 

VIII. TERMINATION

 

Any Party may terminate this MOA and any related agreement, work-plan and budget
in the event either party fails to perform any of its obligations under this MOA
by giving thirty (30) days prior written notice to the other Party.

 

IX. NO JOINT VENTURE

 

Notwithstanding the terms "Partners" and "Partnership", the Partners agree that
they are not entering into a Legal Partnership, joint venture or other such
business arrangement. Neither Partner will refer to or treat the arrangements
under this Agreement as a Legal Partnership or take any action inconsistent with
such intention other than outlined in the terms of this agreement.

 

X. DISPUTE RESOLUTION

 

The Partners hereby agree that, in the event of any dispute between the Partners
relating to this Agreement, the Partners shall first seek to resolve the dispute
through informal discussions. In the event any dispute cannot be resolved
informally within 90 ninety calendar and consecutive days, the Partners agree
that the dispute will be negotiated between the Partners through mediation, if
Partners can agree on a mediator. The costs of mediation shall be shared equally
by the Partners.

 

Neither Partner waives its legal rights to adjudicate this Agreement in a legal
forum. In the event of a litigious resolution, the non-prevailing party in any
dispute under this agreement shall pay all costs and expenses, including expert
witness fees and attorneys' fees, incurred by the prevailing party in resolving
such dispute.

 

So as to limit liability, in no event shall either party be liable to the other
or any third party in contract, tort or otherwise for incidental or
consequential damages of any kind, including, without limitation, punitive or
economic damages or lost profits, regardless of whether either party shall be
advised, shall have other reason to know or in fact shall know of the
possibility.

 

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XI. ASSIGNMENT/SUBCONTRACTING

 

Neither party shall have the right to assign or subcontract any part of its
obligations under this agreement.

 

XII. GOVERNING LAW

 

This agreement shall be governed by and construed in accordance with the
internal laws of the State of Minnesota, U.S.A., without reference to any
conflicts of law provisions.

 

XIII. FORCE MAJEURE

 

Neither party shall be held responsible for any delay or failure in performance
of any part of this agreement to the extent such delay or failure is caused by
fire, flood, explosion, war, embargo, government requirement, civil or military
authority, catastrophic act(s) of nature, or other similar causes beyond its
control and without the fault or negligence of the delayed or non-performing
party. The affected party will notify the other party in writing within ten (10)
days after the beginning of any such cause that would affect its performance.
Notwithstanding, if a party's performance is delayed for a period exceeding
thirty (30) days from the date the other party receives notice under this
paragraph, the non-affected party will have the right, without any liability to
the other party, to terminate this agreement.

 

XIV. INDEMNITY

 

Each party shall indemnify, defend, and hold the other party harmless from and
against any and all claims, actions, suits, demands, assessments, or judgments
asserted, and any and all losses, liabilities, damages, costs, and expenses
(including, without limitation, attorneys fees, accounting fees, and
investigation costs to the extent permitted by law) alleged or incurred arising
out of or relating to any operations, acts, or omissions of the indemnifying
party or any of its employees, agents, and invitees in the exercise of the
indemnifying party's rights or the performance or observance of the indemnifying
party's obligations under this agreement. Prompt notice must be given of any
claim, and the party who is providing the indemnification will have control of
any defense or settlement.

 

XV. ENTIRETY

 

This Agreement, including all Annexes, embodies the entire and complete
understanding and agreement between the Partners and no amendment will be
effective unless signed by both Partners.

 

FOR Head North LLC

Date

 

/s/ Nic Quiles, III

8/22/2016

Nic Quiles, III, Partner

 

FOR Indoor Harvest Corp.

Date

 

/s/ John Choo

8/22/2016

John Choo, President

 

 

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