Exhibit 10.4
 

REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this “Agreement”), dated as of May 11, 2018,
by and among CLS HOLDINGS USA, INC., a Nevada corporation (the “Company”), and
among YA II PN, LTD., a Cayman Islands exempt company (the “Investor”).
WHEREAS:
A.          In connection with the Securities Purchase Agreement by and among
the parties hereto of even date herewith (the “Securities Purchase Agreement”),
the Company has agreed, upon the terms and subject to the conditions of the
Securities Purchase Agreement, to issue and sell to the Investor (i) convertible
debenture (the “Convertible Debentures”) which shall be convertible into shares
of the Company’s common stock, par value $0.0001 per share (the “Common Stock,”
as converted, the “Conversion Shares”) in accordance with the terms of the
Convertible Debentures and (ii) warrants (the “Warrant”) to purchase upon
exercise shares of Common Stock, (as exercised, the “Warrant Shares”) in
accordance with the terms of the Warrants. Capitalized terms not defined herein
shall have the meaning ascribed to them in the Securities Purchase Agreement.
B.          To induce the Investor to execute and deliver the Securities
Purchase Agreement, the Company has agreed to provide certain registration
rights under the Securities Act of 1933, as amended, and the rules and
regulations thereunder, or any similar successor statute (collectively, the
“Securities Act”), and applicable state securities laws and other rights as
provided for herein.
NOW, THEREFORE, in consideration of the premises and the mutual covenants
contained herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and the Investor
hereby agree as follows:
1.          DEFINITIONS.
As used in this Agreement, the following terms shall have the following
meanings:
(a)          “Effectiveness Deadline” means, with respect to a Registration
Statement filed hereunder, there shall be no deadline to obtain the
effectiveness of the Registration Statement, provided however, the Company shall
use its best efforts to address any comments received by the Company upon review
of the Registration Statement by the U.S. Securities and Exchange Commission
(“SEC”) and shall use commercially reasonable efforts to address any accounting
comments received by the Company upon review of the Registration statement by
the SEC and resubmit such Registration Statement within 10 business days of
receipt of such comments from the SEC provided, however, in the event the
Company is notified by SEC that the above Registration Statement will not be
reviewed or is no longer subject to further review and comments, the
Effectiveness Deadline as to such Registration Statement shall be the 5th
Trading Day following the date on which the Company is so notified if such date
precedes the dates required above.
1

--------------------------------------------------------------------------------

(b)          “Filing Deadline” means, with respect to the initial Registration
Statement required hereunder no later than July 20, 2018.
(c)           “Person” means a corporation, a limited liability company, an
association, a partnership, an organization, a business, an individual, a
governmental or political subdivision thereof or a governmental agency.
(d)          “Prospectus” means the prospectus included in a Registration
Statement (including, without limitation, a prospectus that includes any
information previously omitted from a prospectus filed as part of an effective
registration statement in reliance upon Rule 430A promulgated under the
Securities Act), as amended or supplemented by any prospectus supplement, with
respect to the terms of the offering of any portion of the Registrable
Securities covered by a Registration Statement, and all other amendments and
supplements to the Prospectus, including post‑effective amendments, and all
material incorporated by reference or deemed to be incorporated by reference in
such Prospectus.
(e)          “Registrable Securities” means all of (i) the Conversion Shares
issuable upon conversion of the Convertible Debentures, (ii) the Warrant Shares
issued or issuable upon exercise of the Warrants, (iii) any additional shares
issuable in connection with any anti-dilution provisions in the Warrants or the
Convertible Debentures (without giving effect to any limitations on exercise set
forth in the Warrants or Convertible Debentures) and (iv) any shares of Common
Stock issued or issuable with respect to the Conversion Shares, the Convertible
Debentures, the Warrant Shares, or the Warrants as a result of any stock split,
dividend or other distribution, recapitalization or similar event or otherwise,
without regard to any limitations on the conversion of the Convertible
Debentures or exercise of the Warrants.
(f)           “Registration Statement” means the registration statements
required to be filed hereunder (including any additional registration statements
contemplated by Section 3(c)), including (in each case) the Prospectus,
amendments and supplements to such registration statement or Prospectus,
including pre- and post-effective amendments, all exhibits thereto, and all
material incorporated by reference or deemed to be incorporated by reference in
such registration statement.
(g)          “Required Registration Amount” means (i) with respect to the
initial Registration Statement (A) if only the First Closing occurs under the
Securities Purchase Agreement 1,875,000 Conversion Shares issuable upon
conversion of the Convertible Debentures and 1,875,000 Warrant Shares issued or
issuable upon exercise of the Warrants, (B) if the Second Closing occurs under
the Securities Purchase Agreement a total of 3,125,000 Conversion Shares
issuable upon conversion of the Convertible Debentures and 3,125,000 Warrant
Shares issued or issuable upon exercise of the Warrants, and (ii) with respect
to subsequent Registration Statements all remaining Registrable Securities to be
filed, in each case subject to any cutback set forth in Section 2(d).
(h)           “Rule 415” means Rule 415 promulgated by the SEC pursuant to the
Securities Act, as such Rule may be amended from time to time, or any similar
rule or regulation hereafter adopted by the SEC having substantially the same
purpose and effect as such Rule.
2

--------------------------------------------------------------------------------

2.          REGISTRATION.
(a)          The Company’s registration obligations set forth in this Section 2
including its obligations to file the initial Registration Statements, obtain
effectiveness of the Registration Statement, and maintain the continuous
effectiveness of Registration Statements that have been declared effective shall
begin on the date hereof and continue until all the Registrable Securities have
been sold or may permanently be sold without any restrictions pursuant to Rule
144, as determined by the counsel to the Company or Investor’s counsel, pursuant
to a written opinion letter to such effect, addressed and acceptable to the
Company’s transfer agent and the affected holders of the Convertible Debenture
(the “Registration Period”).
(b)          On or prior to the Filing Deadline, the Company shall prepare and
file with the SEC a Registration Statement on Form S-1 (or, if the Company is
then eligible, on Form S-3) covering the resale by the Investor of the
Registrable Securities. Each Registration Statement prepared pursuant hereto
shall, subject to Section 2(d), register for resale at least the number of
shares of Common Stock equal to the Required Registration Amount as of date the
Registration Statement is initially filed with the SEC. Each Registration
Statement shall contain the “Selling Stockholders” and “Plan of Distribution”
sections in substantially the form attached hereto as Exhibit A or in another
form prepared by the Company and reasonably acceptable to the Investor and
contain all the required disclosures set forth on Exhibit B.  The Company shall
use its best efforts to have each Registration Statement declared effective by
the SEC as soon as practicable, but in no event later than the applicable
Effectiveness Deadline.  By 9:30 am on the date following the date of
effectiveness, the Company shall file with the SEC in accordance with Rule 424
under the 1933 Act the final Prospectus to be used in connection with sales
pursuant to such Registration Statement.  Prior to the filing of the
Registration Statement with the SEC, the Company shall furnish a draft of the
Registration Statement to the Investor for their review and comment.  The
Investor shall furnish comments on the Registration Statement to the Company
within twenty-four (24) hours of the receipt thereof from the Company.
(c)          During the Registration Period, the Company shall (i) promptly
prepare and file with the SEC such amendments (including post-effective
amendments) and supplements to a Registration Statement and the Prospectus used
in connection with a Registration Statement, which Prospectus is to be filed
pursuant to Rule 424 promulgated under the Securities Act, as may be necessary
to keep such Registration Statement effective at all times during the
Registration Period, (ii) prepare and file with the SEC additional Registration
Statements in order to register for resale under the Securities Act all of the
Registrable Securities; (ii) cause the related Prospectus to be amended or
supplemented by any required Prospectus supplement (subject to the terms of this
Agreement), and as so supplemented or amended to be filed pursuant to Rule 424;
(iii) respond as promptly as reasonably possible to any comments received from
the SEC with respect to a Registration Statement or any amendment thereto and as
promptly as reasonably possible provide the Investor true and complete copies of
all correspondence from and to the SEC relating to a Registration Statement
(provided that the Company may excise any information contained therein which
would constitute material non-public information as to any Investor which has
not executed a confidentiality agreement with the Company); and (iv) comply with
the provisions of the Securities Act with respect to the disposition of all
Registrable Securities of the Company covered by such Registration Statement
until such time as all of such Registrable Securities shall have been disposed
of in accordance with the intended methods of disposition by the seller or
sellers thereof
3

--------------------------------------------------------------------------------

as set forth in such Registration Statement.  In the case of amendments and
supplements to a Registration Statement which are required to be filed pursuant
to this Agreement (including pursuant to this Section 3(d)) by reason of the
Company’s filing a report on Form 10-K, Form 10-Q or Form 8-K or any analogous
report under the Securities Exchange Act of 1934, as amended (the “Exchange
Act”), the Company shall incorporate such report by reference into the
Registration Statement, if applicable, or shall file such amendments or
supplements with the SEC within 2 Trading Days after it files the Exchange Act
report which created the requirement for the Company to amend or supplement the
Registration Statement.
(d)          Reduction of Registrable Securities Included in a Registration
Statement. Notwithstanding anything contained herein, in the event that the SEC
requires the Company to reduce the number of Registrable Securities to be
included in a Registration Statement in order to allow the Company to rely on
Rule 415 with respect to a Registration Statement, then the Company shall be
obligated to include in such Registration Statement (which may be a subsequent
Registration Statement if the Company needs to withdraw a Registration Statement
and refile a new Registration Statement or file multiple Registration Statements
in order to rely on Rule 415) only such limited portion of the Registrable
Securities as the SEC shall permit, as well as such portion of the registrable
securities held by other unaffiliated security holders with registration rights
who are entitled to include such registrable securities in the Registration
Statement, based on a pro rata amount of the aggregate amount of each security
holders dollars invested.  Any Registrable Securities that are excluded in
accordance with the foregoing terms are hereinafter referred to as “Cut Back
Securities.”  To the extent Cut Back Securities exist, as soon as may be
permitted by the SEC, the Company shall be required to file a Registration
Statement covering the resale of the Cut Back Securities (subject also to the
terms of this Section) and shall use reasonable best efforts to cause such
Registration Statement to be declared effective as promptly as practicable
thereafter.
(e)          Failure to File or Obtain Effectiveness of the Registration
Statement or Remain Current.     If: (i) a Registration Statement is not filed
on or prior to its Filing Date (if the Company files a Registration Statement
without affording the Holders the opportunity to review and comment on the same
as required by Section 2(c), the Company shall not be deemed to have satisfied
this clause (i)), or (ii) the Company fails to file with the SEC a request for
acceleration in accordance with Rule 461 promulgated under the Securities Act,
within five Trading Days of the date that the Company is notified (orally or in
writing, whichever is earlier) by the SEC that a Registration Statement will not
be “reviewed,” or not subject to further review, or (iii) a Registration
Statement filed or required to be filed hereunder is not declared effective by
the SEC by its Effectiveness Deadline, or (iv) after the effectiveness, a
Registration Statement ceases for any reason to remain continuously effective as
to all Registrable Securities for which it is required to be effective, or the
Holders are otherwise not permitted to utilize the Prospectus therein to resell
such Registrable Securities for more than 30 consecutive calendar days or more
than an aggregate of 60 calendar days during any 12-month period (which need not
be consecutive calendar days) and the Holders shall not have Rule 144 available
for the sale of Registrable Securities, or (v) if after the 6 month anniversary
of the date hereof, the Company does not have available adequate current public
information as set forth in Rule 144(c) (any such failure or breach being
referred to as an “Event”), then in addition to any other rights the holders of
the Convertible Debenture may have hereunder or under applicable law, on each
such Event date and on each monthly anniversary of each such Event date (if the
applicable Event shall not have been cured by such date) until the
4

--------------------------------------------------------------------------------

applicable Event is cured, the Company shall be deemed to be in breach of this
Agreement and the other Transaction Documents and shall be deemed an Event of
Default hereunder.
3.          RELATED OBLIGATIONS.
(a)          The Company shall, not less than 2 Trading Days prior to the filing
of each Registration Statement and not less than 1 Trading Day prior to the
filing of any related amendments and supplements to all Registration Statements
(except for annual reports on Form 10-K), furnish to the Investor electronic
copies of all such documents proposed to be filed, which documents (other than
those incorporated or deemed to be incorporated by reference) will be subject to
the reasonable and prompt review of the Investor, The Company shall not file a
Registration Statement or any such Prospectus or any amendments or supplements
thereto to which the Investor shall reasonably object in good faith; provided
that, the Company is notified of such objection in writing no later than 1
Trading Days after the Investor has been so furnished copies of a Registration
Statement.
(b)          The Company shall furnish to the Investor whose Registrable
Securities are included in any Registration Statement, which obligation may be
met by directing the Investor to www.sec.gov, (i) an electronic copy of such
Registration Statement as declared effective by the SEC and any amendment(s)
thereto, including financial statements and schedules, all documents
incorporated therein by reference, all exhibits and each preliminary prospectus,
(ii) an electronic copy of the final prospectus included in such Registration
Statement and all amendments and supplements thereto (or such other number of
copies as the Investor may reasonably request) and (iii) such other documents as
the Investor may reasonably request from time to time in order to facilitate the
disposition of the Registrable Securities owned by the Investor.
(c)          The Company shall use its best efforts to (i) register and qualify
the Registrable Securities covered by a Registration Statement under such other
securities or “blue sky” laws of such jurisdictions in the United States as the
Investor reasonably requests, (ii) prepare and file in those jurisdictions, such
amendments (including post-effective amendments) and supplements to such
registrations and qualifications as may be necessary to maintain the
effectiveness thereof during the Registration Period, (iii) take such other
actions as may be necessary to maintain such registrations and qualifications in
effect at all times during the Registration Period, and (iv) take all other
actions reasonably necessary or advisable to qualify the Registrable Securities
for sale in such jurisdictions; provided, however, that the Company shall not be
required in connection therewith or as a condition thereto to (w) make any
change to its articles of incorporation or by-laws, (x) qualify to do business
in any jurisdiction where it would not otherwise be required to qualify but for
this Section 3(c), (y) subject itself to general taxation in any such
jurisdiction, or (z) file a general consent to service of process in any such
jurisdiction.  The Company shall promptly notify the Investor who holds
Registrable Securities of the receipt by the Company of any notification with
respect to the suspension of the registration or qualification of any of the
Registrable Securities for sale under the securities or “blue sky” laws of any
jurisdiction in the United States or its receipt of actual notice of the
initiation or threat of any proceeding for such purpose.
(d)          As promptly as practicable after becoming aware of such event or
development, the Company shall notify the Investor in writing of the happening
of any event as a
5

--------------------------------------------------------------------------------

result of which the Prospectus included in a Registration Statement, as then in
effect, includes an untrue statement of a material fact or omission to state a
material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading (provided that in no event shall such notice contain any material,
nonpublic information), and promptly prepare a supplement or amendment to such
Registration Statement to correct such untrue statement or omission, and deliver
such supplement or amendment to the Investor, which delivery obligation may be
fulfilled by directing the Investor to www.sec.gov.  The Company shall also
promptly notify the Investor in writing (i) when a Prospectus or any Prospectus
supplement or post-effective amendment has been filed, and when a Registration
Statement or any post-effective amendment has become effective (notification of
such effectiveness shall be delivered to the Investor by electronic mail on the
same day of such effectiveness), (ii) of any request by the SEC for amendments
or supplements to a Registration Statement or related prospectus or related
information, and (iii) of the Company’s reasonable determination that a
post-effective amendment to a Registration Statement would be appropriate.
(e)          The Company shall use its best efforts to prevent the issuance of
any stop order or other suspension of effectiveness of a Registration Statement,
or the suspension of the qualification of any of the Registrable Securities for
sale in any jurisdiction within the United States of America and, if such an
order or suspension is issued, to obtain the withdrawal of such order or
suspension at the earliest possible moment and to notify the Investor who holds
Registrable Securities being sold of the issuance of such order and the
resolution thereof or its receipt of actual notice of the initiation or threat
of any proceeding for such purpose.
(f)          If, after the execution of this Agreement, the Investor believes,
after consultation with its legal counsel, that it could reasonably be deemed to
be an underwriter of Registrable Securities, at the request of the Investor, the
Company shall furnish to the Investor, on the date of the effectiveness of the
Registration Statement and thereafter from time to time on such dates as the
Investor may reasonably request (i) a letter, dated such date, from the
Company’s independent certified public accountants in form and substance as is
customarily given by independent certified public accountants to underwriters in
an underwritten public offering, and (ii) an opinion, dated as of such date, of
counsel representing the Company for purposes of such Registration Statement, in
form, scope and substance as is customarily given in an underwritten public
offering, addressed to the Investor.
(g)          If, after the execution of this Agreement, the Investor believes,
after consultation with its legal counsel, that it could reasonably be deemed to
be an underwriter of Registrable Securities, at the request of the Investor, the
Company shall make available for inspection by (i) the Investor and (ii) one (1)
firm of accountants or other agents retained by the Investor (collectively, the
“Inspectors”) all pertinent financial and other records, and pertinent corporate
documents and properties of the Company (collectively, the “Records”), as shall
be reasonably deemed necessary by each Inspector, and cause the Company’s
officers, directors and employees to supply all information which any Inspector
may reasonably request; provided, however, that each Inspector shall agree, and
the Investor hereby agrees, to hold in strict confidence and shall not make any
disclosure (except to the Investor) or use  any Record or other information
which the Company determines in good faith to be confidential, and of which
determination the Inspectors are so notified, unless (a) the disclosure of such
Records is necessary to avoid or correct a misstatement or omission in any
Registration Statement or is otherwise
6

--------------------------------------------------------------------------------

required under the Securities Act, (b) the release of such Records is ordered
pursuant to a final, non-appealable subpoena or order from a court or government
body of competent jurisdiction, or (c) the information in such Records has been
made generally available to the public other than by disclosure in violation of
this or any other agreement of which the Inspector and the Investor has
knowledge.  The Investor agrees that it shall, upon learning that disclosure of
such Records is sought in or by a court or governmental body of competent
jurisdiction or through other means, give prompt notice to the Company and allow
the Company, at its expense, to undertake appropriate action to prevent
disclosure of, or to obtain a protective order for, the Records deemed
confidential.  Notwithstanding anything to the contrary in the foregoing
paragraph, the Company shall not be required to provide the detail of highly
confidential patent applications and such disclosure shall be limited to a short
summary of the substance of each such patent.
(h)          The Company shall hold in confidence and not make any disclosure of
information concerning the Investor provided to the Company unless (i)
disclosure of such information is necessary to comply with federal or state
securities laws, (ii) the disclosure of such information is necessary to avoid
or correct a misstatement or omission in any Registration Statement, (iii) the
release of such information is ordered pursuant to a subpoena or other final,
non-appealable order from a court or governmental body of competent
jurisdiction, or (iv) such information has been made generally available to the
public other than by disclosure in violation of this Agreement or any other
agreement.  The Company agrees that it shall, upon learning that disclosure of
such information concerning the Investor is sought in or by a court or
governmental body of competent jurisdiction or through other means, give prompt
written notice to such Investor and allow the Investor, at the Investor’s
expense, to undertake appropriate action to prevent disclosure of, or to obtain
a protective order for, such information.
(i)          The Company shall use its best efforts either to cause all the
Registrable Securities covered by a Registration Statement (i) to be listed on
each securities exchange on which securities of the same class or series issued
by the Company are then listed, if any, if the listing of such Registrable
Securities is then permitted under the rules of such exchange or (ii) the
inclusion for quotation on the OTC Bulletin Board for such Registrable
Securities.  The Company shall pay all fees and expenses in connection with
satisfying its obligation under this Section 3(i).
(j)          The Company shall cooperate with the Investor who holds Registrable
Securities being offered and, to the extent applicable, to facilitate the timely
preparation and delivery of certificates (not bearing any restrictive legend)
representing the Registrable Securities to be offered pursuant to a Registration
Statement and enable such certificates to be in such denominations or amounts,
as the case may be, as the Investor may reasonably request and registered in
such names as the Investor may request.
(k)          The Company shall otherwise use its best efforts to comply with all
applicable rules and regulations of the SEC in connection with any registration
hereunder.
(l)          Within 2 business days after a Registration Statement which covers
Registrable Securities is declared effective by the SEC, the Company shall
deliver, and shall cause legal counsel for the Company to deliver, to the
transfer agent for such Registrable Securities (with copies to the Investor
whose Registrable Securities are included in such Registration Statement)
7

--------------------------------------------------------------------------------

confirmation in such form customary for such notices of effectiveness, that such
Registration Statement has been declared effective by the SEC.
(m)          The Company shall take all other reasonable actions necessary to
expedite and facilitate disposition by the Investor of Registrable Securities
pursuant to a Registration Statement.
4.          OBLIGATIONS OF THE INVESTOR.
(a)          The Investor agrees that, upon receipt of any notice from the
Company of the happening of any event of the kind described in Section 3(d) the
Investor will immediately discontinue disposition of Registrable Securities
pursuant to any Registration Statement covering such Registrable Securities
until the Investor’s receipt of the copies of the supplemented or amended
prospectus contemplated by Section 3(d) or receipt of notice that no supplement
or amendment is required.  Notwithstanding anything to the contrary, the Company
shall cause its transfer agent to deliver unlegended certificates for shares of
Common Stock to a transferee of the Investor in accordance with the terms of the
Securities Purchase Agreement in connection with any sale of Registrable
Securities with respect to which the Investor has entered into a contract for
sale prior to the Investor’s receipt of a notice from the Company of the
happening of any event of the kind described in Section 3(d) and for which the
Investor has not yet settled.
(b)          The Investor covenants and agrees that it will comply with the
prospectus delivery requirements of the Securities Act as applicable to it or an
exemption therefrom in connection with sales of Registrable Securities pursuant
to the Registration Statement and that it will comply with Regulation M of the
Exchange Act in connection with its offering and sale of its Registrable
Securities.
(c)          The Investor shall accurately and fully complete the Selling Holder
Questionnaire attached hereto as Exhibit B and shall deliver it the Company
within 2 days of the date hereof.
5.          EXPENSES OF REGISTRATION.
All expenses incurred in connection with registrations, filings or
qualifications pursuant to Sections 2 and 3, including, without limitation, all
registration, listing and qualifications fees, printers, legal and accounting
fees shall be paid by the Company; provided, however that the Investor shall pay
all underwriters’ discounts and brokers’ commissions and the cost of Investor’s
legal counsel and accountants if any in connection with Sections 2 and 3.
6.          INDEMNIFICATION.
With respect to Registrable Securities which are included in a Registration
Statement under this Agreement:
(a)          To the fullest extent permitted by law, the Company will, and
hereby does, indemnify, hold harmless and defend the Investor, the directors,
officers, partners, employees, agents, representatives of, and each Person, if
any, who controls the Investor within the meaning of the Securities Act or the
Exchange Act (each, an “Indemnified Person”), against any losses,
8

--------------------------------------------------------------------------------

claims, damages, liabilities, judgments, fines, penalties, charges, costs,
reasonable attorneys’ fees, amounts paid in settlement or expenses, joint or
several (collectively, “Claims”) incurred in investigating, preparing or
defending any action, claim, suit, inquiry, proceeding, investigation or appeal
taken from the foregoing by or before any court or governmental, administrative
or other regulatory agency, body or the SEC, whether pending or threatened,
whether or not an indemnified party is or may be a party thereto (“Indemnified
Damages”), to which any of them may become subject insofar as such Claims (or
actions or proceedings, whether commenced or threatened, in respect thereof)
arise out of or are based upon: (i) any untrue statement or alleged untrue
statement of a material fact in a Registration Statement or any post-effective
amendment thereto or in any filing made in connection with the qualification of
the offering under the securities or other “blue sky” laws of any jurisdiction
in which Registrable Securities are offered (“Blue Sky Filing”), or the omission
or alleged omission to state a material fact required to be stated therein or
necessary to make the statements therein not misleading; (ii) any untrue
statement or alleged untrue statement of a material fact contained in any final
prospectus (as amended or supplemented, if the Company files any amendment
thereof or supplement thereto with the SEC) or the omission or alleged omission
to state therein any material fact necessary to make the statements made
therein, in light of the circumstances under which the statements therein were
made, not misleading; or (iii) any violation or alleged violation by the Company
of the Securities Act, the Exchange Act, any other law, including, without
limitation, any state securities law, or any rule or regulation thereunder
relating to the offer or sale of the Registrable Securities pursuant to a
Registration Statement (the matters in the foregoing clauses (i) through (iii)
being, collectively, “Violations”).  The Company shall reimburse the Investor
and each such controlling person promptly as such expenses are incurred and are
due and payable, for any legal fees or disbursements or other reasonable
expenses incurred by them in connection with investigating or defending any such
Claim.  Notwithstanding anything to the contrary contained herein, the
indemnification agreement contained in this Section 6(a): (x) shall not apply to
a Claim by an Indemnified Person arising out of or based upon a Violation which
occurs in reliance upon and in conformity with information furnished in writing
to the Company by any Indemnified Person expressly for use in connection with
the preparation of the Registration Statement or any such amendment thereof or
supplement thereto; (y) shall not be available to the extent such Claim is based
on a failure of the Investor to deliver or to cause to be delivered the
prospectus made available by the Company, if such prospectus was timely made
available by the Company pursuant to Section 3(c); and (z) shall not apply to
amounts paid in settlement of any Claim if such settlement is effected without
the prior written consent of the Company, which consent shall not be
unreasonably withheld. Such indemnity shall remain in full force and effect
regardless of any investigation made by or on behalf of the Indemnified Person
and shall survive the transfer of the Registrable Securities by the Investor
pursuant to Section 9 hereof.  Notwithstanding anything to the contrary
contained herein, the indemnification agreement contained in this Section 6(b)
with respect to any prospectus shall not inure to the benefit of any Indemnified
Party if the untrue statement or omission of material fact contained in the
prospectus was corrected and such new prospectus was delivered to the Investor
prior to the Investor’s use of the prospectus to which the Claim relates.
(b)          In connection with a Registration Statement, the Investor agrees to
severally and not jointly indemnify, hold harmless and defend, to the same
extent and in the same manner as is set forth in Section 6(a), the Company, each
of its directors, each of its officers, employees, representatives, or agents
and each Person, if any, who controls the Company within the meaning of the
Securities Act or the Exchange Act (each an “Indemnified Party”), against any
Claim or
9

--------------------------------------------------------------------------------

Indemnified Damages to which any of them may become subject, under the
Securities Act, the Exchange Act or otherwise, insofar as such Claim or
Indemnified Damages arise out of or is based upon any Violation, in each case to
the extent, and only to the extent, that such Violation (i) occurs in reliance
upon and in conformity with written information furnished to the Company by the
Investor expressly for use in connection with such Registration Statement, or
(ii) occurs due to the Investor’s violation of any law, including federal and
state securities laws and regulations, in connection with its offering, sale and
distribution of its Registrable Securities; and, subject to Section 6(d), the
Investor will reimburse any legal or other expenses reasonably incurred by them
in connection with investigating or defending any such Claim; provided, however,
that the indemnity agreement contained in this Section 6(b) and the agreement
with respect to contribution contained in Section 7 shall not apply to amounts
paid in settlement of any Claim if such settlement is effected without the prior
written consent of such Investor, which consent shall not be unreasonably
withheld; provided, further, however, that the Investor shall be liable under
this Section 6(b) for only that amount of a Claim or Indemnified Damages as does
not exceed the net proceeds to the Investor as a result of the sale of
Registrable Securities pursuant to such Registration Statement.  Such indemnity
shall remain in full force and effect regardless of any investigation made by or
on behalf of such Indemnified Party and shall survive the transfer of the
Registrable Securities by the Investor pursuant to Section 9.  .
(c)          Promptly after receipt by an Indemnified Person or Indemnified
Party under this Section 6 of notice of the commencement of any action or
proceeding (including any governmental action or proceeding) involving a Claim,
such Indemnified Person or Indemnified Party shall, if a Claim in respect
thereof is to be made against any indemnifying party under this Section 6,
deliver to the indemnifying party a written notice of the commencement thereof,
and the indemnifying party shall have the right to participate in, and, to the
extent the indemnifying party so desires, jointly with any other indemnifying
party similarly noticed, to assume control of the defense thereof with counsel
mutually satisfactory to the indemnifying party and the Indemnified Person or
the Indemnified Party, as the case may be; provided, however, that an
Indemnified Person or Indemnified Party shall have the right to retain its own
counsel with the fees and expenses of not more than one (1) counsel for such
Indemnified Person or Indemnified Party to be paid by the indemnifying party,
if, in the reasonable opinion of counsel retained by the indemnifying party, the
representation by such counsel of the Indemnified Person or Indemnified Party
and the indemnifying party would be inappropriate due to actual or potential
differing  interests between such Indemnified Person or Indemnified Party and
any other party represented by such counsel in such proceeding.  The Indemnified
Party or Indemnified Person shall cooperate fully with the indemnifying party in
connection with any negotiation or defense of any such action or claim by the
indemnifying party and shall furnish to the indemnifying party all information
reasonably available to the Indemnified Party or Indemnified Person which
relates to such action or claim.  The indemnifying party shall keep the
Indemnified Party or Indemnified Person fully apprised at all times as to the
status of the defense or any settlement negotiations with respect thereto.  No
indemnifying party shall be liable for any settlement of any action, claim or
proceeding effected without its prior written consent; provided, however, that
the indemnifying party shall not unreasonably withhold, delay or condition its
consent.  No indemnifying party shall, without the prior written consent of the
Indemnified Party or Indemnified Person, consent to entry of any judgment or
enter into any settlement or other compromise which does not include as an
unconditional term thereof the giving by the claimant or plaintiff to such
Indemnified Party or Indemnified Person of a release from all liability in
respect to such claim or litigation.  Following
10

--------------------------------------------------------------------------------

indemnification as provided for hereunder, the indemnifying party shall be
subrogated to all rights of the Indemnified Party or Indemnified Person with
respect to all third parties, firms or corporations relating to the matter for
which indemnification has been made.  The failure to deliver written notice to
the indemnifying party within a reasonable time of the commencement of any such
action shall not relieve such indemnifying party of any liability to the
Indemnified Person or Indemnified Party under this Section 6, except to the
extent that the indemnifying party is prejudiced in its ability to defend such
action.
(d)          The indemnification required by this Section 6 shall be made by
periodic payments of the amount thereof during the course of the investigation
or defense, as and when bills are received or Indemnified Damages are incurred.
(e)          The indemnity agreements contained herein shall be in addition to
(i) any cause of action or similar right of the Indemnified Party or Indemnified
Person against the indemnifying party or others, and (ii) any liabilities the
indemnifying party may be subject to pursuant to the law.
7.          CONTRIBUTION.
To the extent any indemnification by an indemnifying party is prohibited or
limited by law, the indemnifying party agrees to make the maximum contribution
with respect to any amounts for which it would otherwise be liable under Section
6 to the fullest extent permitted by law; provided, however, that:  (i) no
seller of Registrable Securities guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any seller of Registrable Securities who was not guilty of
fraudulent misrepresentation; and (ii) contribution by any seller of Registrable
Securities shall be limited in amount to the net amount of proceeds received by
such seller from the sale of such Registrable Securities.
8.          REPORTS UNDER THE EXCHANGE ACT.
With a view to making available to the Investor the benefits of Rule 144
promulgated under the Securities Act or any similar rule or regulation of the
SEC that may at any time permit the Investor to sell securities of the Company
to the public without registration (“Rule 144”), and as a material inducement to
the Investor’s purchase of the Convertible Debenture, the Company represents,
warrants, and covenants to the following:
(a)          The Company is subject to the reporting requirements of section 13
or 15(d) of the Exchange Act and has filed all required reports under section 13
or 15(d) of the Exchange Act during the 12 months prior to the date hereof (or
for such shorter period that the issuer was required to file such reports),
other than Form 8-K reports
(b)          During the Registration Period, the Company shall file with the SEC
in a timely manner all required reports under section 13 or 15(d) of the
Exchange Act (it being understood that nothing herein shall limit the Company’s
obligations under the Securities Purchase Agreement) and such reports shall
conform to the requirement of the Exchange Act and the SEC for filing
thereunder.
11

--------------------------------------------------------------------------------

(c)          The Company shall furnish to the Investor so long as the Investor
owns Registrable Securities, promptly upon request, (i) a written statement by
the Company that it has complied with the reporting requirements of Rule 144,
(ii) a copy of the most recent annual or quarterly report of the Company and
such other reports and documents so filed by the Company, and which obligation
may be met by directing the Investor to www.sec.gov (iii) such other information
as may be reasonably requested to permit the Investor to sell such securities
pursuant to Rule 144 without registration.
9.          AMENDMENT OF REGISTRATION RIGHTS.
Provisions of this Agreement may be amended and the observance thereof may be
waived (either generally or in a particular instance and either retroactively or
prospectively), only with the written consent of the Company and the Investor. 
Any amendment or waiver effected in accordance with this Section 9 shall be
binding upon the Investor and the Company.  No such amendment shall be effective
to the extent that it applies to fewer than all of the holders of the
Registrable Securities.  No consideration shall be offered or paid to any Person
to amend or consent to a waiver or modification of any provision of any of this
Agreement unless the same consideration also is offered to all of the parties to
this Agreement.
10.          MISCELLANEOUS.
(a)          A Person is deemed to be a holder of Registrable Securities
whenever such Person owns or is deemed to own of record such Registrable
Securities or owns the right to receive the Registrable Securities.  If the
Company receives conflicting instructions, notices or elections from two (2) or
more Persons with respect to the same Registrable Securities, the Company shall
act upon the basis of instructions, notice or election received from the
registered owner of such Registrable Securities.
(b)          No Piggyback on Registrations.  Except as set forth on Schedule
10(b) attached hereto which will be updated to include security holders in
connection with any raise conducted by the Company in connection with the Oasis
Transaction, neither the Company nor any of its security holders (other than the
Investor in such capacity pursuant hereto) may include securities of the Company
in the initial Registration Statement other than the Registrable Securities. 
The Company shall not file any other registration statements until the initial
Registration Statement required hereunder is declared effective by the SEC,
provided that this Section 10(b) shall not prohibit the Company from filing
amendments to registration statements already filed.
(c)          Piggy-Back Registrations.  If at any time there is not an effective
Registration Statement covering all of the Registrable Securities and the
Company shall determine to prepare and file with the SEC a registration
statement relating to an offering for its own account or the account of others
under the Securities Act of any of its equity securities, other than on Form S-4
or Form S-8 (each as promulgated under the Securities Act) or their then
equivalents relating to equity securities to be issued solely in connection with
any acquisition of any entity or business or equity securities issuable in
connection with the stock option or other employee benefit plans, then the
Company shall send to the Investor a written notice of such determination and,
if within 15 days after the date of such notice, the Investor shall so request
in writing, the Company shall
12

--------------------------------------------------------------------------------

include in such registration statement all or any part of such Registrable
Securities the Investor requests to be registered; provided, however, that, the
Company shall not be required to register any Registrable Securities pursuant to
this Section 10(c) that are eligible for resale pursuant to Rule 144 promulgated
under the Securities Act or that are the subject of a then effective
Registration Statement.  Notwithstanding the foregoing, the provisions of
Section 2(d) shall apply to the filing of any registration statement under this
Section.
(d)          Any notices, consents, waivers or other communications required or
permitted to be given under the terms of this Agreement must be in writing and
will be deemed to have been delivered upon:  (i) receipt, when delivered
personally, (ii) 1 Business Day after deposit with an overnight courier service
with next day delivery specified, in each case, properly addressed to the party
to receive the same, or  (iii) receipt, when sent by electronic mail (provided
that the electronic mail transmission is not returned in error or the sender is
not otherwise notified of any error in transmission. The addresses and e-mail
addresses for such communications shall be:
If to the Company, to:
CLS Holdings USA, Inc..
 
11767 South Dixie Highway – Suite 115
 
Miami, FL 33156
 
Attention:    Jeffrey I. Binder
Telephone:  (305) 992-2500
Email:            jeff@clslabs.com
                       jeff@jbinder.net

 
With Copy to:
Broad and Cassel LLP  
One North Clematis Street – Suite 500
West Palm Beach, FL 33401
     
Attention:    Kathleen L. Deutsch, Esq.
Telephone:  (561) 832-3300
Email:            kdeutsch@broadandcassel.com
                      kathydash@aol.com
   
If to the Investor:
YA II PN, Ltd.
 
c/o Yorkville Advisors Global, LP
1012 Springfield Avenue
 
Mountainside, NJ  07092
 
Attention:   Mark Angelo
 
Telephone:  (201) 985-8300
Email:            mangelo@yorkvilleadvisors.com
   
With a copy to:
David Gonzalez, Esq.
 
1012 Springfield Avenue
 
Mountainside, NJ  07092
 
Telephone:  (201) 985-8300
 
Email:           dgonzalez@yorkvilleadvisors.com and Legal@yorkvilleadvisors.com
   

 
13

--------------------------------------------------------------------------------

or at such other address and/or electronic email address and/or to the attention
of such other person as the recipient party has specified by written notice
given to each other party 3 Business Days prior to the effectiveness of such
change.  Written confirmation of receipt (i) given by the recipient of such
notice, consent, waiver or other communication, (ii) mechanically or
electronically generated by the sender’s computer containing the time, date,
recipient’s electronic mail address and the text of such electronic mail or
(iii) provided by a nationally recognized overnight delivery service, shall be
rebuttable evidence of personal service, receipt by electronic mail or receipt
from a nationally recognized overnight delivery service in accordance with
clause (i), (ii) or (iii) above, respectively.
(e)          Failure of any party to exercise any right or remedy under this
Agreement or otherwise, or delay by a party in exercising such right or remedy,
shall not operate as a waiver thereof.
(f)          The laws of the State of New Jersey shall govern all issues
concerning the relative rights of the Company and the Investor as its
stockholders.  All other questions concerning the construction, validity,
enforcement and interpretation of this Agreement shall be governed by the
internal laws of the State of New Jersey, without giving effect to any choice of
law or conflict of law provision or rule (whether of the State of New Jersey or
any other jurisdiction) that would cause the application of the laws of any
jurisdiction other than the State of New Jersey.  Each party hereby irrevocably
submits to the non-exclusive jurisdiction of the Superior Courts of the State of
New Jersey, sitting in Union County, New Jersey and federal courts for the
District of New Jersey sitting Newark, New Jersey, for the adjudication of any
dispute hereunder or in connection herewith or with any 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 personally
subject to the jurisdiction of any such court, that such suit, action or
proceeding is brought in an inconvenient forum or that the venue of such suit,
action or proceeding is improper.  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 to such party at the address for such
notices to it under this Agreement and agrees that such service shall constitute
good and sufficient service of process and notice thereof.  Nothing contained
herein shall be deemed to limit in any way any right to serve process in any
manner permitted by law.  If any provision of this Agreement shall be invalid or
unenforceable in any jurisdiction, such invalidity or unenforceability shall not
affect the validity or enforceability of the remainder of this Agreement in that
jurisdiction or the validity or enforceability of any provision of this
Agreement in any other jurisdiction.  EACH PARTY HEREBY IRREVOCABLY WAIVES ANY
RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION
OF ANY DISPUTE HEREUNDER OR IN CONNECTION HEREWITH OR ARISING OUT OF THIS
AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.
(g)          This Agreement shall inure to the benefit of and be binding upon
the permitted successors and assigns of each of the parties hereto.
(h)          The headings in this Agreement are for convenience of reference
only and shall not limit or otherwise affect the meaning hereof.
(i)          This Agreement may be executed in identical counterparts, each of
which shall be deemed an original but all of which shall constitute one and the
same agreement.  This
14

--------------------------------------------------------------------------------

Agreement, once executed by a party, may be delivered to the other party hereto
by facsimile transmission of a copy of this Agreement bearing the signature of
the party so delivering this Agreement.
(j)          Each party shall do and perform, or cause to be done and performed,
all such further acts and things, and shall execute and deliver all such other
agreements, certificates, instruments and documents, as the other party may
reasonably request in order to carry out the intent and accomplish the purposes
of this Agreement and the consummation of the transactions contemplated hereby.
(k)          The language used in this Agreement will be deemed to be the
language chosen by the parties to express their mutual intent and no rules of
strict construction will be applied against any party.
(l)          This Agreement is intended for the benefit of the parties hereto
and their respective permitted successors and assigns, and is not for the
benefit of, nor may any provision hereof be enforced by, any other Person.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
 
 
 

15

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, each of the Investor and the Company has affixed their
respective signatures to this  Registration Rights Agreement as of the date
first written above

COMPANY:
CLS HOLDINGS USA, INC., a Nevada corporation

By:  /s/ Jeffrey I. Binder                       
Name:   Jeffrey I. Binder
Title:           Chairman and CEO

INVESTOR:
YA II PN, LTD.
By:          Yorkville Advisors Global, LP
Its:          Investment Manager

By:          Yorkville Advisors Global II, LLC
Its:          General Partner

By: /s/ Matthew Beckman                      
Name:  Matthew Beckman
Title:  Managing Member

16

--------------------------------------------------------------------------------

EXHIBIT A

SELLING STOCKHOLDERS
AND PLAN OF DISTRIBUTION

Selling Stockholders

The shares of Common Stock being offered by the selling stockholders are
issuable upon conversion of the convertible debenture.  For additional
information regarding the issuance of those convertible notes, see “Private
Placement of Convertible Debenture” above.  We are registering the shares of
Common Stock in order to permit the selling stockholders to offer the shares for
resale from time to time.  Except as otherwise noted and except for the
ownership of the convertible Debenture issued pursuant to the Securities
Purchase Agreement, the selling stockholders have not had any material
relationship with us within the past three years.
The table below lists the selling stockholders and other information regarding
the beneficial ownership of the shares of Common Stock by each of the selling
stockholders.  The second column lists the number of shares of Common Stock
beneficially owned by each selling stockholder, based on its ownership of the
convertible debenture, as of ________, 200_, assuming conversion of all
convertible debentures and exercise of the warrants held by the selling
stockholders on that date, without regard to any limitations on conversions or
exercise.
The third column lists the shares of Common Stock being offered by this
prospectus by the selling stockholders.
In accordance with the terms of a registration rights agreement with the selling
stockholders, this prospectus generally covers the resale of at least 3,750,000
shares of common stock issued or issuable to the selling stockholders pursuant
to the Securities Purchase Agreement.  Because the conversion price of the
convertible debenture may be adjusted, the number of shares that will actually
be issued may be more or less than the number of shares being offered by this
prospectus.  The fourth column assumes the sale of all of the shares offered by
the selling stockholders pursuant to this prospectus.
Under the terms of the convertible debenture , a selling stockholder may not
convert the convertible debenture to the extent such conversion would cause such
selling stockholder, together with its affiliates, to beneficially own a number
of shares of Common Stock which would exceed 4.99% of our then outstanding
shares of Common Stock following such conversion, excluding for purposes of such
determination shares of Common Stock issuable upon conversion of the convertible
debenture which have not been converted.  The number of shares in the second
column does not reflect this limitation.  The selling stockholders may sell all,
some or none of their shares in this offering.  See “Plan of Distribution.”

1

--------------------------------------------------------------------------------

Name of Selling Stockholder

Number of Shares Owned Prior to Offering
Maximum Number of Shares to be Sold Pursuant to this Prospectus

Number of Shares Owned After Offering
YA II PN, Ltd. (1)
     

(1)          YA II PN, Ltd. is a Cayman Island exempt limited company. 
Yorkville Advisors Global, LP (“Yorkville LP”) is YA’s investment manager and
Yorkville Advisors Global II, LLC (“Yorkville LLC”) is the General Partner of
Yorkville LP. All investment decisions for YA are made by Yorkville LLC’s
President and Managing Member, Mark Angelo..

2

--------------------------------------------------------------------------------

Plan of Distribution
Each Selling Stockholder (the “Selling Stockholders”) of the common stock and
any of their pledgees, assignees and successors-in-interest may, from time to
time, sell any or all of their shares of common stock on the __________ or any
other stock exchange, market or trading facility on which the shares are traded
or in private transactions.  These sales may be at fixed or negotiated prices. 
A Selling Stockholder may use any one or more of the following methods when
selling shares:
·
ordinary brokerage transactions and transactions in which the broker‑dealer
solicits purchasers;

·
block trades in which the broker‑dealer will attempt to sell the shares as agent
but may position and resell a portion of the block as principal to facilitate
the transaction;

·
purchases by a broker‑dealer as principal and resale by the broker‑dealer for
its account;

·
an exchange distribution in accordance with the rules of the applicable
exchange;

·
privately negotiated transactions;

·
broker‑dealers may agree with the Selling Stockholders to sell a specified
number of such shares at a stipulated price per share;

·
through the writing or settlement of options or other hedging transactions,
whether through an options exchange or otherwise;

·
a combination of any such methods of sale; or

·
any other method permitted pursuant to applicable law.

The Selling Stockholders may also sell shares under Rule 144 under the
Securities Act of 1933, as amended (the “Securities Act”), if available, rather
than under this prospectus.
Broker‑dealers engaged by the Selling Stockholders may arrange for other
brokers‑dealers to participate in sales.  Broker‑dealers may receive commissions
or discounts from the Selling Stockholders (or, if any broker‑dealer acts as
agent for the purchaser of shares, from the purchaser) in amounts to be
negotiated, but, except as set forth in a supplement to this Prospectus, in the
case of an agency transaction not in excess of a customary brokerage commission
in compliance with NASDR Rule 2440; and in the case of a principal transaction a
markup or markdown in compliance with NASDR IM-2440.
In connection with the sale of the common stock or interests therein and except
if the Debentures remain outstanding, the Selling Stockholders may enter into
hedging transactions with broker-dealers or other financial institutions, which
may in turn engage in short sales of the Common Stock in the course of hedging
the positions they assume.  The Selling Stockholders may
3

--------------------------------------------------------------------------------

also enter into option or other transactions with broker-dealers or other
financial institutions or the creation of one or more derivative securities
which require the delivery to such broker-dealer or other financial institution
of shares offered by this prospectus, which shares such broker-dealer or other
financial institution may resell pursuant to this prospectus (as supplemented or
amended to reflect such transaction).
The Selling Stockholders and any broker-dealers or agents that are involved in
selling the shares may be deemed to be “underwriters” within the meaning of the
Securities Act in connection with such sales.  In such event, any commissions
received by such broker-dealers or agents and any profit on the resale of the
shares purchased by them may be deemed to be underwriting commissions or
discounts under the Securities Act.  Each Selling Stockholder has informed the
Company that it does not have any written or oral agreement or understanding,
directly or indirectly, with any person to distribute the Common Stock. In no
event shall any broker-dealer receive fees, commissions and markups which, in
the aggregate, would exceed eight percent (8%).
The Company is required to pay certain fees and expenses incurred by the Company
incident to the registration of the shares.  The Company has agreed to indemnify
the Selling Stockholders against certain losses, claims, damages and
liabilities, including liabilities under the Securities Act.
Because Selling Stockholders may be deemed to be “underwriters” within the
meaning of the Securities Act, they will be subject to the prospectus delivery
requirements of the Securities Act including Rule 172 thereunder.  In addition,
any securities covered by this prospectus which qualify for sale pursuant to
Rule 144 under the Securities Act may be sold under Rule 144 rather than under
this prospectus.  There is no underwriter or coordinating broker acting in
connection with the proposed sale of the resale shares by the Selling
Stockholders.
We agreed to keep this prospectus effective until the earlier of (i) the date on
which the shares may be resold by the Selling Stockholders without registration
and without regard to any volume limitations by reason of Rule 144 under the
Securities Act or any other rule of similar effect or (ii) all of the shares
have been sold pursuant to this prospectus or Rule 144 under the Securities Act
or any other rule of similar effect.  The resale shares will be sold only
through registered or licensed brokers or dealers if required under applicable
state securities laws. In addition, in certain states, the resale shares may not
be sold unless they have been registered or qualified for sale in the applicable
state or an exemption from the registration or qualification requirement is
available and is complied with.
Under applicable rules and regulations under the Exchange Act, any person
engaged in the distribution of the resale shares may not simultaneously engage
in market making activities with respect to the common stock for the applicable
restricted period, as defined in Regulation M, prior to the commencement of the
distribution.  In addition, the Selling Stockholders will be subject to
applicable provisions of the Exchange Act and the rules and regulations
thereunder, including Regulation M, which may limit the timing of purchases and
sales of shares of the common stock by the Selling Stockholders or any other
person.  We will make copies of this prospectus available to the Selling
Stockholders and have informed them of the need to deliver a copy of this
prospectus to each purchaser at or prior to the time of the sale (including by
compliance with Rule 172 under the Securities Act).
4

--------------------------------------------------------------------------------

EXHIBIT B

CLS HOLDINGS USA, INC.
Selling Stockholder Questionnaire

The undersigned beneficial owner of common stock and/or warrants to purchase
common stock (the “Registrable Securities”) of CLS Holdings USA Inc. (the
“Company”), understands that the Company has filed or intends to file with the
Securities and Exchange Commission (the “Commission”) a registration statement
(the “Registration Statement”) for the registration and resale of the
Registrable Securities under the Securities Act of 1933, as amended (the
“Securities Act”), in accordance with the terms of the Registration Rights
Agreement (the “Registration Rights Agreement”) to which this document is
annexed.  A copy of the Registration Rights Agreement is available from the
Company upon request at the address set forth below.  All capitalized terms not
otherwise defined herein shall have the meanings ascribed thereto in the
Registration Rights Agreement.
Certain legal consequences arise from being named as a selling stockholder in
the Registration Statement and the related prospectus.  Accordingly, holders and
beneficial owners of Registrable Securities are advised to consult their own
securities law counsel regarding the consequences of being named or not being
named as a selling stockholder in the Registration Statement and the related
prospectus.
In order to sell or otherwise dispose of any Registrable Shares pursuant to the
Registration Statement, a beneficial owner of Registrable Securities will be
required to be named as a selling securityholder in the related prospectus,
deliver a prospectus to purchasers of Registrable Securities and be bound by
those provisions of the Registration Rights Agreement applicable to such
beneficial owner (including certain indemnification provisions described
therein).  Beneficial owners that do not complete this Questionnaire and deliver
it to the Company as provided below will not be named as selling securityholders
in the prospectus and therefore will not be permitted to sell any Registrable
Securities pursuant to the Registration Statement.  Beneficial owners must
complete and deliver this Questionnaire within the time period set forth in the
Registration Rights Agreement so that such beneficial owners can be named as
selling security holders in the related prospectus.  If a beneficial holder of
Registrable Securities transfers some or all of his or her Registrable
Securities to another person or entity after the deadline for submission of this
Questionnaire has passed, the Company shall have no obligation to include the
transferee in the Registration Statement or related prospectus until after the
Registration Statement has been declared effective by the Securities and
Exchange Commission, at which time, the Company will supplement the prospectus
not less often than one time per month, if so requested by new beneficial
holders of Registrable Securities.

NOTICE
The undersigned beneficial owner (the “Selling Stockholder”) of Registrable
Securities hereby elects to include the Registrable Securities owned by it in
the Registration Statement.
1

--------------------------------------------------------------------------------

The undersigned hereby provides the following information to the Company and
represents and warrants that such information is accurate:
QUESTIONNAIRE

1.
Name.

(a)
Full Legal Name of Selling Stockholder

   

(b)
Full Legal Name of Registered Holder (if not the same as (a) above) through
which Registrable Securities are held (please note than an assignment may be
required):

   

(c)
Full Legal Name of Natural Control Person (which means a natural person who
directly or indirectly alone or with others has power to vote or dispose of the
securities covered by this Questionnaire):

   

(d)
Tax Identification or Social Security Number:

   

11.

(e)
Full legal name of Depository Trust Company participant (if applicable and if
not the same as (c) above) through which the Registrable Shares are held:

Name of
Broker:                                                                                                                       

DTC
No.:                                                                                                                             

Contact
Person:                                                                                                                        

Telephone No.:
                                                                                                                        ___
2

--------------------------------------------------------------------------------

(f)          
Will you be engaging in any passive market making or stabilization transactions
with respect to the Registrable Shares?

Yes ____
No  ____

12.          
(g)          If your response to (f) above is “Yes,” please describe the
circumstances:

                                                                                                                                    
                                                                                                                                    
                                                                                                                                    

2.  Address for Notices to Selling Stockholder:

     
 
Telephone: 
 
Fax:
 
Contact Person: 
 

3.  Broker-Dealer Status:

(a)
Are you a broker-dealer?

Yes  ☐          No    ☐

(b)
If “yes” to Section 3(a), did you receive your Registrable Securities as
compensation for investment banking services to the Company?

Yes  ☐          No   ☐

Note:
If “no” to Section 3(b), the Commission’s staff has indicated that you should be
identified as an underwriter in the Registration Statement.

(c)
Are you an affiliate of a broker-dealer?

Yes  ☐          No   ☐

(d)
If you are an affiliate of a broker-dealer, do you certify that you purchased
the Registrable Securities in the ordinary course of business, and at the time
of the purchase of the Registrable Securities to be resold, you had no
agreements or understandings, directly or indirectly, with any person to
distribute the Registrable Securities?

Yes  ☐          No   ☐
3

--------------------------------------------------------------------------------

Note:
If “no” to Section 3(d), the Commission’s staff has indicated that you should be
identified as an underwriter in the Registration Statement.

4.  Beneficial Ownership of Securities of the Company Owned by the Selling
Stockholder.
Except as set forth below in this Item 4, the undersigned is not the beneficial
or registered owner of any securities of the Company other than the securities
issuable pursuant to the Registration Rights Agreement.
(a)                    Type and Amount of Registrable Securities purchased
pursuant to the Subscription Agreement and being offered for sale pursuant to
the Registration Statement:
_________________________________________________________________
_________________________________________________________________
(b)                    Type and amount of other securities beneficially owned by
the Selling Stockholder:

     

5.  Relationships with the Company:
Except as set forth below, neither the undersigned nor any of its affiliates,
officers, directors or principal equity holders (owners of 5% of more of the
equity securities of the undersigned) has held any position or office or has had
any other material relationship with the Company (or its predecessors or
affiliates) during the past three years.
State any exceptions here:

     

The undersigned agrees to promptly notify the Company of any inaccuracies or
changes in the information provided herein that may occur subsequent to the date
hereof at any time while the Registration Statement remains effective.
By signing below, the undersigned consents to the disclosure of the information
contained herein in its answers to Items 1 through 5 and the inclusion of such
information in the Registration Statement and the related prospectus and any
amendments or supplements thereto.  The undersigned
4

--------------------------------------------------------------------------------

understands that such information will be relied upon by the Company in
connection with the preparation or amendment of the Registration Statement and
the related prospectus and any amendments or supplements thereto.

6.  Plan of Distribution
Except as set forth below, the undersigned (including the undersigned’s donees
or pledgees) intends to distribute the Registrable Securities listed above in
Item 4 pursuant to the Registration Statement only in accordance with Exhibit A
attached to the Registration Rights Agreement. 
  
State any exceptions
here:____________________________________________________________________

Note:  In no event will such method(s) of distribution take the form of an
underwritten offering of the Registrable Shares without the prior written
agreement of the Company.

The undersigned acknowledges the undersigned’s obligation to comply with the
prospectus delivery and other provisions of the Securities Act, provisions of
the Securities Exchange Act of 1934 and the rules and regulations thereunder,
particularly Regulation M (or any successor rules or regulations), in connection
with any offering or sale of Registrable Securities pursuant to the Subscription
Agreement.  The undersigned agrees that neither the undersigned nor any person
acting on the undersigned’s behalf engage in any transaction in violation of
such provisions.

If the undersigned transfers all or any portion of the Registrable Securities
listed in Item 4 above after the date of this Questionnaire, the undersigned
agrees to notify the transferee(s) at the time of the transfer of such
transferee(s) rights and obligations under this Questionnaire and the
Subscription Agreement and its requirement to complete a new Questionnaire.

The undersigned hereby acknowledges the undersigned’s obligations under the
Registration Rights Agreement to indemnify and hold harmless certain persons as
set forth therein.  Pursuant to the Registration Rights Agreement, the Company
has agreed under certain circumstances to indemnify the undersigned against
certain liabilities.
IN WITNESS WHEREOF the undersigned, by authority duly given, has caused this
Notice and Questionnaire to be executed and delivered either in person or by its
duly authorized agent.
Date:                                                                                      Beneficial
Owner:                                                                          

By: 
                                                                                                
Name:
Title:

 
5

--------------------------------------------------------------------------------

 
PLEASE FAX A COPY (OR EMAIL A .PDF COPY) OF THE COMPLETED AND EXECUTED NOTICE
AND QUESTIONNAIRE, AND RETURN THE ORIGINAL BY OVERNIGHT MAIL, TO:

Broad and Cassel LLP
1 North Clematis Street, Suite 500
West Palm Beach, Florida  33401
Attn: Kathleen L. Deutsch, P.A.
kdeutsch@broadandcassel.com

6

--------------------------------------------------------------------------------

Schedule 10(b) – Piggy-Back Registration Rights. –

Darling Capital, LLC
Efrat Investments, LLC
David Lamadrid

The investors in the WestPark Capital, Inc. securities offering