EXECUTIVE EMPLOYMENT AGREEMENT

 

This EXECUTIVE EMPLOYMENT AGREEMENT (this “Agreement”), dated as of July 25,
2018 (the “Effective Date”), is entered into by and between TYG Solutions Corp.,
a Delaware corporation (the “Company”), and Mark Corrao (“Executive”).

 

RECITALS

 

WHEREAS, Executive and the Company desire to set forth the terms and conditions
of Executive’s employment by the Company.

 

NOW, THEREFORE, in consideration of the promises and mutual covenants contained
herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Company and Executive hereby
agree as follows:

 

AGREEMENT

 

Section 1.Term. Unless sooner terminated as provided in Section 9 of this
Agreement, the term of this Agreement shall be for a period of one (1) year
commencing on the Effective Date (the “Initial Term”). This Agreement shall
automatically renew for successive six (6) month terms (the “Renewal Term(s),”
collectively with the “Initial Term”, the “Term”), unless either party provides
written notice to the other of its intent to terminate this Agreement not less
than thirty (30) days before the end of the then current Term. Notwithstanding
the foregoing, the Company and Executive acknowledge and agree that Executive’s
employment hereunder shall at all times be “at will,” which means that either
Executive may resign at any time for any reason or for no reason, and that the
Company may terminate Executive’s employment at any time for any reason or for
no reason, in either case, subject to the applicable provisions of this
Agreement. 

 

Section 2.Position, Duties and Responsibilities. During the Term, subject to the
terms and conditions of this Agreement, the Company shall employ Executive, and
Executive shall serve, as Chief Financial Officer of the Company, reporting
directly to the Chief Executive Officer of the Company. Executive shall also
hold such other positions with the Company or any of its affiliated companies
during the Term as the Board of Directors of the Company (as constituted from
time to time, the “Board”) may specify and Executive may agree from time to
time. Executive shall have such duties and responsibilities as shall be
commensurate with the positions held by him at any time. Executive shall devote
such professional time as is necessary to perform his obligations under this
Agreement, and shall faithfully, industriously and to the best of his ability,
experience and talent, perform the duties and responsibilities of his
position(s). 

 

Section 3.Principal Location. Executive’s principal location of employment shall
be 3805 Old Easton Road, Doylestown, PA 18902 (the “Principal Executive
Office”), provided, however, that the Company may from time to time require
Executive to travel temporarily to other locations in connection with the
Company’s business. 

 

Section 4.Base Salary. During the Term, Executive shall be paid a base salary
(the “Base Salary”) that initially shall be $12,500 per month, which is
equivalent to $150,000 annually, subject to applicable tax withholding. The Base
Salary will be paid bi-monthly on the first and the fifteenth day of each month,
or otherwise in accordance with the regular payroll practices of the Company
from time to time in effect. The Board may increase the Base Salary in its sole
discretion. 

 

Section 5.Equity Awards. In further consideration for Executive’s services, the
Board shall consider in good faith whether to grant equity awards to Executive
based upon, among other things as the Board may deem relevant, the performance
of the Executive and the Company. 

 

Section 6.Other Benefits. During the Term, Executive shall be entitled to
receive such other employment-related benefits and perquisites as are provided
to senior executives of the Company and its subsidiaries under the Company’s
employee benefit plans and policies generally that are not specifically
otherwise addressed herein, as such benefits may be changed from time to time in
the sole discretion of the Company. 

 

Section 7.Reimbursement of Expenses. During the Term, the Company shall pay (or
promptly reimburse Executive) for all reasonable out-of-pocket expenses incurred
by Executive in the course of performing his duties and responsibilities
hereunder, which are consistent with the Company’s policies in effect from time
to time with respect to business expenses. 

 

Section 8.Payments. All payments by the Company to Executive shall be paid in
U.S. dollars and shall be subject to any deductions for state and federal
withholding tax, social security and all other employment taxes and payroll
deductions required by law. 

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Section 9.Termination of Employment. 

 

(a)Upon any termination of Executive’s employment, Executive (or his estate in
the event his employment terminates upon his death) shall be entitled to be paid
(i) all accrued but unpaid Base Salary through the last day of employment, (ii)
any unpaid or unreimbursed expenses incurred during the Term in accordance with
Section 7 of this Agreement, and (iii) any vested and accrued benefits with the
inclusion of unused vacation accruals provided under the Company’s employee
benefit plans and policies (including vacation policies) upon termination of
employment in accordance with the terms contained therein (collectively, the
“Accrued Obligations”). 

 

(b)The Company may terminate Executive’s employment at any time for Cause.
“Cause” shall mean a good faith determination by the Board that Executive has:
(i) engaged in any act of willful and gross misconduct or fraud in the course of
his employment; (ii) been convicted of or pleaded “guilty” or “no contest” to a
felony or other crime of moral turpitude; or (iii) materially breached this
Agreement which, in the case of clause (iii) only, has not been cured within 30
days of written notice to Executive of such violation. Any termination for Cause
shall be effective immediately upon delivery to Executive of written notice of
such termination, subject to the cure right in clause (iii) above. In the event
that the Company terminates Executive’s employment for Cause, he shall be
entitled only to be paid the Accrued Obligations and shall have no right to any
further compensation or any other benefits under this Agreement. 

 

(c)The Company may terminate Executive’s employment at any time without Cause,
and Executive may resign for Good Reason at any time. “Good Reason” shall mean
Executive’s voluntary resignation due to the Company, without Executive’s
written consent, (A) effecting any material diminution in Executive’s duties and
responsibilities that is inconsistent with Executive’s position with the
Company, (B) materially reducing Executive’s compensation, (C) changing the
Principal Executive Office to a location more than 50 miles from the prior
Principal Executive Office, or (D) materially breaching this Agreement or any
other agreement with Executive. Executive shall provide at least 30 days’ notice
of his intent to resign for Good Reason. If the Company remedies the basis on
which Executive proposes to resign for Good Reason prior to the expiration of
the 30-day notice period, Executive’s resignation will be deemed withdrawn and
shall not become effective. 

 

(d)If Executive’s employment is terminated by the Company without Cause or if
Executive resigns for Good Reason, Executive shall be entitled to (1) be paid
the Accrued Obligations; (2) receive his then current Base Salary during the
then remaining Term (payable over the period in accordance with the Company’s
regular payroll practices);and (3) in the event that Executive participates in
any group health or benefit plans of the Company as of the time of such
termination, (x) if Executive elects coverage under the applicable provisions of
the Consolidated Omnibus Budget Reconciliation Act (COBRA), continued coverage
for himself and his family under the Company’s group health or benefit plan in
which Executive was participating as of immediately prior to such termination of
employment and reimbursement (the “Premium Reimbursement”) of the portion of the
premiums that the Company would have paid had Executive’s employment continued
for the then remaining Term following such termination (the “Continued Coverage
Period”) until the earlier of (1) the end of the Continued Coverage Period or
(2) the date on which Executive becomes eligible for health coverage through
another employer; or (y) if such Premium Reimbursement would result in the
imposition of an excise tax or other penalties on the Company or is not
permissible under the terms of the Company’s applicable health or benefit plan,
a dollar amount payable each month during the Continued Coverage Period (or
applicable portion thereof) equal to the Premium Reimbursement that the Company
would have paid for such month under clause (x) above (clauses (2) and (3)
together, “Severance”). Executive’s right to receive Severance is expressly
conditioned on Executive not engaging in any activities that violate any of the
covenants set forth herein. Should executive engage in any such prohibited
activities, then Executive shall have no further right or claim to any Severance
to which Executive may otherwise be entitled under this subsection (d), from and
after the date on which Executive engages in such activities and the Company
shall have no further obligations with respect to the payment of Severance. 

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Section 10.Non-Competition; Non-Hire; Non-Disparagement. During the Term and for
an additional period of one and one-half (1 1/2) years, Executive, and/or any
business he is affiliated with, shall not engage or participate in any cannabis
based business (for purposes of this Agreement, wherever the term
"cannabis-based business" is used it shall mean any business engaged in the
manufacture, sale, development, distribution, marketing or research and
development of products that are derived from, related to any cannabinoids,
including but not limited to, synthetic versions of cannabinoids, whether
pharmaceutical or over-the-counter) that is in competition in any manner
whatsoever with the current or anticipated cannabis based business of the
Company (the “Restricted Period”). In furtherance of, and not in limitation of
the foregoing, during the Restricted Period, Executive shall not, directly or
indirectly, accept employment with, be a consultant or advisor to, or own any
equity interest in (other than shares of a publicly traded company that
represent less than 2% of the outstanding shares) any business enterprise that
is in competition in any manner whatsoever with the current or anticipated
cannabis based business of the Company. During the Restricted Period, neither
Executive nor his affiliates shall solicit for employment or hire any employee
of the Company or any affiliate. Executive shall not directly or indirectly make
any statement or any other expressions (in writing, orally or otherwise) on
television, radio, the Internet or other media or to any third party, including
in communication with any customers, vendors, prospects, employees, equity
holders, governmental agency, sales or leasing representatives or distributors,
which are in any way disparaging of the Company or any of its affiliates (or of
any of their respective equity holders) or the products or services of the
Company or any of its affiliates (or any of their respective equity holders) or
places any of the foregoing in a negative light. 

 

Section 11.Section 409A. This Agreement and the amounts payable hereunder are
intended to be exempt from or comply with the requirements of Section 409A of
the Internal Revenue Code of 1986, as amended, and the rules and regulations
promulgated thereunder (the “Code”), and shall be interpreted, construed, and
performed consistent with such intent. Each payment in a series of payments
hereunder shall be deemed to be a separate payment for purposes of Section 409A
of the Code. Notwithstanding any provision in this Agreement to the contrary:
(a) the payment of any “nonqualified deferred compensation” (within the meaning
of Section 409A of the Code) upon a termination of employment shall be delayed
until such time as Executive also has undergone a “separation from service” as
defined in Treas. Reg. 1.409A-1(h), at which time such nonqualified deferred
compensation (calculated as of the date of Executive’s termination of employment
hereunder) shall be paid to Executive as if Executive had undergone such
termination of employment (under the same circumstances) on the date of
Executive’s ultimate “separation from service”; (b) any payment otherwise
required to be made hereunder to Executive as a result of the termination of
Executive’s employment shall be delayed for such period of time as may be
necessary to meet the requirements of Section 409A(a)(2)(B)(i) of the Code (to
the extent applicable to Executive), in which case Executive shall be paid on
the first business day following the expiration of such period of time, in a
single payment, an amount equal to the aggregate amount of all delayed payments,
and any remaining payments not so delayed shall continue to be paid pursuant to
the payment schedule set forth herein; and (c) to the extent that any right to
reimbursement of expenses or payment of any benefit in-kind under this Agreement
constitutes nonqualified deferred compensation, (i) any such expense
reimbursement shall be made by Executive no later than the last day of the
taxable year following the taxable year in which such expense was incurred by
Executive, (ii) the right to reimbursement or in-kind benefits shall not be
subject to liquidation or exchange for another benefit and (iii) the amount of
expenses eligible for reimbursement or in-kind benefits provided during any
taxable year shall not affect the expenses eligible for reimbursement or in-kind
benefits to be provided in any other taxable year. 

 

Section 12.Disclosure of Information. 

 

(a)Obligation of Executive. Executive recognizes that the Company possesses a
body of existing technology and intellectual property right and is engaged in a
continuous program of research, development and production with respect to its
business (present and future). Executive further understands and hereby
acknowledges, understands and agrees that all Confidential and Proprietary
Information, as set forth in Section 12(b), is the exclusive and confidential
property of the Company and shall be at all times regarded, treated and
protected as such in accordance with this Agreement. Executive acknowledges that
all such Confidential and Proprietary Information is in the nature of a trade
secret. Failure to mark any writing “confidential” shall not affect the
confidential nature of such writing or the information contained therein.
Notwithstanding any provision herein to the contrary, for purposes of this
Section 12, the term “Company” shall refer to the Company and each of its parent
and subsidiaries. 

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(b)Definition of Confidential and Proprietary Information. “Confidential and
Proprietary Information” shall mean information which is used in the Company’s
business and (1) is proprietary to, about or created by the Company; (2) gives
the Company some competitive business advantage or the opportunity of obtaining
such advantage or the disclosure of which could be detrimental to the interest
of the Company; or (3) is designated as Confidential and Proprietary Information
by the Company, known by the Executive to be considered confidential by the
Company, or from all relevant circumstances should reasonably be assumed by the
Executive to be confidential and proprietary to the Company, except such
Confidential and Proprietary Information that (i) becomes known generally to the
public through no fault of the Executive, (ii) is required to be disclosed by
the Executive in connection with the performance of his duties as set forth in
this Agreement, (iii) the disclosure of which, is necessary to comply with the
applicable federal, state or local laws, legal process or any order or mandate
of a court or other governmental authority, (iv) is reasonably believed by the
Executive, based upon the advice of legal counsel, to be required to be
disclosed in defense of a lawsuit or other legal or administrative action
brought against the Executive, and (v) the Executive can show was acquired, or
is acquired after the date of this Agreement from a third party and such third
party did not obtain such Confidential and Proprietary Information from the
Executive subject to or in violation of obligations similar to those set forth
in this Section 12; provided, however, that in the case of subparagraphs (iii)
and (iv), the Executive shall give the Company reasonable advance written notice
of the Confidential and Proprietary Information intended to be disclosed and the
reasons and circumstances surrounding such disclosure, in order to permit the
Company to seek a protective order or other appropriate request for confidential
treatment of the applicable Confidential and Proprietary Information. Such
Confidential and Proprietary Information includes, but is not limited to, the
following types of information and other information of a similar nature
(whether or not reduced to writing or designated as confidential): 

 

(i)trade secrets, inventions, mask works, ideas, processes, formulas, source and
object codes, data, programs, other works of authorship, know-how, improvements,
discoveries, developments, designs and techniques; 

 

(ii)prototype products, current and currently contemplated products and
projects, prototype resource information, copyrights, and other proprietary
information, including, but not limited to, techniques, sketches, drawings,
models, inventions, know-how, processes, apparatus, equipment, and know how
related to the current, future and proposed products, projects, documents and
services of the Company, prices or other financial data, volume of sales,
promotional methods, marketing plans, lists of names or classes of customers or
personnel, mode of operation and other details of its products and services, as
well as names and expertise of employees, consultants, customers and prospects,
lists of suppliers, business plan, forecasts, strategies, product or project
development plans, forecasts, strategies, business opportunities, or financial
statements and further includes, without limitation, any information of the
Company concerning research, development, design details and specifications,
financial information, procurement requirements, purchasing, customer lists,
business forecasts, and such other information that derives independent economic
value, actual or potential, for not being generally known to the public or to
other persons; and 

 

(iii)Confidential and proprietary information provided to the Company by any
actual or potential customer, government agency, or other third party (including
businesses, consultants and other entities and individuals). 

In furtherance of, and not in limitation of the foregoing, Confidential and
Proprietary Information shall include any copies, summaries, reports, analyses,
compilations, interpretations, reflections, studies, derivatives or extracts
thereof, or the like, prepared, contributed to and/or reviewed or received by
Executive and which contains Confidential Proprietary Information.

 

(c)Covenants of Executive. As a consequence of Executive’s position with the
Company, Executive will occupy a position of trust and confidence with respect
to the Company’s affairs and business and will have access to Confidential and
Proprietary Information. In view of the foregoing and of the consideration to be
provided to the Executive, the Executive agrees that it is reasonable and
necessary that the Executive make the following covenants, which covenants shall
survive the termination of this Agreement, as follows: 

(i)Except as set forth in Section 12(b), the Executive will not disclose
Confidential and Proprietary Information to any person or entity, either inside
or outside the Company without first obtaining the Company’s prior written
consent. 

 

(ii)Except as set forth in Section 12(b), Executive will not use, copy or
transfer Confidential and Proprietary Information without first obtaining the
Company’s prior written consent. 

 

(iii)Upon the termination of the Term, the Executive shall promptly deliver to
the Company (or its designee) all written materials, records and documents made
by the Executive or coming into his possession prior to or during the Term
concerning the business or affairs of the Company, including all materials
containing Confidential and Proprietary Information. Further, the Executive will
make available to the Company all devices, at such times as reasonably
requested, to remove any and all Confidential and Proprietary Information. 

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Section 13.Intellectual Property, Inventions and Patents. 

 

(a)Executive hereby assigns and agrees to assign in the future to the Company
all of Executive’s right, title and interest in and to any and all Inventions
(as defined below) (and all proprietary rights thereto) whether or not
patentable or registrable under copyright of similar statutes, made or conceived
or reduced to practice or learned by Executive, either alone or jointly with
others, prior to or during Executive’s relationship with the Company (other than
the Inventions owned by Kannalife Sciences, Inc. which already have been
acquired by the Company), and any other product, idea, discovery or Invention
related to the present or anticipated business of the Company. The foregoing
shall be in addition to any rights of the Company as a result of such Inventions
being “work for hire” (as defined in the Copyright Act, 17 U.S.C.A. § 101 et
seq., as amended). For purposes of this Agreement, “Inventions” shall mean trade
secrets, inventions, mask works, ideas, processes, formulas, data, research,
results, programs or other works of authorship, improvements, discoveries,
developments, designs and techniques, patented or unpatented. 

 

(b)Executive acknowledges that all discoveries, concepts, ideas, inventions,
innovations, improvements, developments, methods, designs, analyses, drawings,
reports, patent applications, copyrightable work and mask work (whether or not
including any Confidential and Proprietary Information) and all registrations or
applications related thereto, all other proprietary information and all similar
or related information (whether or not patentable) which relate to the Company’s
actual or anticipated business, research and development or existing or future
products or services and which are conceived, developed or made by Executive
(whether alone or jointly with others) while engaged by the Company, whether
before or after the date hereof (“Work Product”), shall be deemed to be “work
made for hire” (as defined in the Copyright Act, 17 U.S.C.A. § 101 et seq., as
amended) and belong exclusively to the Company. Executive shall promptly
disclose such Work Product to the Board and, at the Company’s expense, perform
all actions reasonably requested by the Board (whether during or after the Term)
to establish and confirm such title and ownership (including, without
limitation, assignments, consents, powers of attorney and other instruments). 

 

(c)Executive shall promptly disclose any outside activities or interests,
including any ownership or participation in the development of any Inventions.
Executive understands that Executive is required to make such disclosures
promptly if the activity or interest is related, either directly or indirectly,
to (i) an area of research, development, service, product or product line of the
Company, (ii) a manufacturing, development or research methodology or process of
the Company or (iii) any activity that Consultant may be involved with on behalf
of the Company. In furtherance of, and not in limitation of the foregoing,
during the period of this Agreement and for twelve (12) months after termination
of this Agreement, Executive will promptly disclose to the Company fully and in
writing all Inventions authored, conceived or reduced to practice by Executive,
either alone or jointly with others. In addition, Executive will promptly
disclose to the Company all patent applications filed by Executive or on
Executive’s behalf within twelve (12) months after termination of this
Agreement. 

 

(d)Notwithstanding anything to the contrary contained herein or in any other
document, instrument or agreement between the Company and Executive, Executive
shall not collaborate with any person or entity (a "Collaborating Party"), to
develop any Inventions that are related to, arise out of or are in connection
with cannabis (including but not limited to any products related thereto), and
any other product, idea, discovery or Invention related to the present or
anticipated cannabis based business of the Company (the "Covered Inventions"),
unless prior to such collaboration the Collaborating Party acknowledges the
obligations of Executive hereunder and irrevocably agrees to assign, transfer
and convey all of its/their right, title and interest in and to any and all such
Collaborative Inventions (and all proprietary rights thereto) whether or not
patentable or registrable under copyright of similar statutes, made or conceived
or reduced to practice or learned by the Collaborating Party, either alone or
jointly with others, prior to or during the Collaborating Party's relationship
with the Company and/or Executive. Prior to engaging with a Collaborating Party
to develop Collaborative Inventions, Executive shall provide to the Company
written substantiation that the Collaborating Party has agreed to assign any and
all Collaborative Inventions in form and substance acceptable to the Company. 

 

Section 14.Successors and Assigns. This Agreement is intended to bind and inure
to the benefit of and be enforceable by Executive and the Company and their
respective heirs, successors and assigns, except that Executive may not assign
his rights or delegate his obligations hereunder without the prior written
consent of the Company. The Company shall require any successor to all or
substantially all of the business and/or assets of the Company to assume
expressly and agree to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform it if no such succession
had taken place. Any attempted assignment in contravention of this Section 14
shall be void ab initio. 

 

Section 15.Waiver and Amendments. Any waiver, alteration, amendment, or
modification of any of the terms of this Agreement shall be valid only if made
in writing and signed by each of the parties hereto. No waiver by either of the
parties hereto of their rights hereunder shall be deemed to constitute a waiver
with respect to any subsequent occurrences or transactions hereunder unless such
waiver specifically states that it is to be construed as a continuing waiver. 

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Section 16.Severability. If any covenants or such other provisions of this
Agreement are found to be invalid or unenforceable by a final determination of a
court of competent jurisdiction, (i) the remaining terms and provisions hereof
shall be unimpaired, and (ii) the invalid or unenforceable term or provision
hereof shall be deemed replaced by a term or provision that is valid and
enforceable and that comes closest to expressing the intention of the invalid or
unenforceable term or provision hereof. 

 

Section 17.Governing Law. Except to the extent preempted by federal law, the
validity, interpretation, construction, and performance of this agreement is
governed by and is to be construed under the laws of the State of Pennsylvania
applicable to agreements made and to be performed in that state, without regard
to conflict of laws rules. The parties agree that, in the event of any dispute
arising out of this Agreement or the transactions contemplated thereby, venue
for such dispute shall be in the state or federal courts located in
Philadelphia, PA, and that each party hereto waives any objection to such venue
based on forum non conveniens. 

 

Section 18.Notices. Every notice or other communication relating to this
Agreement shall be in writing, and shall be mailed to or delivered to the party
for whom or which it is intended at such address as may from time to time be
designated by it in a notice mailed or delivered to the other party as herein
provided; provided that, unless and until some other address be so designated,
all notices and communications by Executive to the Company shall be mailed or
delivered to the Company at its principal executive office, and all notices and
communications byte Company to Executive may be given to Executive personally or
may be mailed to Executive at Executive’s last known address, as reflected in
the Company’s records. Any notice so addressed shall be deemed to be given or
received (i) if delivered by hand, on the date of such delivery, (ii) if mailed
by courier or by overnight mail, on the first business day following the date of
such mailing, and (iii) if mailed by registered or certified mail, on the third
business day after the date of such mailing. 

 

Section 19.Entire Agreement. This Agreement and the agreements referred to
herein constitute the entire understanding and agreement of the parties hereto
regarding the employment of Executive. This Agreement supersedes all prior
negotiations, discussions, correspondence, communications, understandings, and
agreements between Executive and the Company and its affiliates relating to the
subject matter of this Agreement. 

 

Section 20.Counterparts; Electronic Delivery. This Agreement may be executed in
two or more counterparts, each of which shall be deemed to be an original but
all of which together shall constitute one and the same instrument. Counterparts
may be delivered via facsimile, electronic mail (including .pdf) or other
transmission method and any counterpart so delivered shall be deemed to have
been duly and validly delivered and be valid and effective for all purposes. 

 

Section 21.Survival of Operative Sections. Upon any termination of Executive’s
employment, the provisions of Section 7 through this Section 21 of this
Agreement shall survive to the extent necessary to give effect to the provisions
thereof. 

 

[Signature page follows.]

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

 

THE COMPANY:

 

 

 

 

TYG SOLUTIONS CORP.

 

 

 

 

 

By:

/s/ Robert T. Malasek

 

 

Name:

Robert T. Malasek

 

 

Title:

Chief Financial Officer

 

 

 

 

 

 

 

EXECUTIVE:

 

 

 

 

 

 

 

/s/ Mark Corrao

 

 

Name:

Mark Corrao

 

 

 

 

 

 

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