Exhibit 10.2

 

EXECUTION VERSION

 

ESCROW AGREEMENT

 

THIS ESCROW AGREEMENT (the “Agreement”) is made as of July ___, 2020,

 

AMONG:  

 

AKERNA CORP., a company existing under the laws of the State of Delaware
(“Akerna”);

 

AND  

 

Akerna Canada Ample Exchange Inc., a company existing under the laws of the
Province of Ontario (“Exchangeco”);

 

AND

 

JOHN PRENTICE, an individual resident in the Province of Ontario (hereinafter
referred to as the “Shareholder Representative”);

AND  

 

ODYSSEY TRUST COMPANY, INC., a trust company licensed to carry on business in
the provinces of Alberta and British Columbia (the “Escrow Agent”).

 

WHEREAS pursuant to an arrangement agreement dated December 18, 2019, as amended
by amending agreements dated February 28, 2020, May 26, 2020 and June 1, 2020
(collectively, the “Arrangement Agreement”) entered into among Akerna,
Exchangeco, Ample Organics Inc. (“Ample”) and the Shareholder Representative,
the parties thereto have agreed that Akerna will purchase, through its
wholly-owned subsidiary, Exchangeco, all of the issued and outstanding common
and preferred shares in the capital of Ample (the “Ample Shares”) by way of an
arrangement under section 182 of the OBCA;

 

AND WHEREAS pursuant to the Arrangement Agreement, Akerna and Exchangeco have
agreed to pay to the shareholders of Ample as a portion of the consideration for
the Ample Shares, redeemable preferred shares in the capital of Exchangeco
(“Exchangeable Shares”);

 

AND WHEREAS pursuant to the Arrangement, the Shareholder Representative has been
appointed as the true, exclusive and lawful representative, attorney-in-fact and
agent for the Ample Shareholders in connection with this Agreement and is
thereby authorized to make all decisions, take all actions or do any and all
thing necessary on their behalf relating to the matters contained herein;

 

AND WHEREAS the Arrangement Agreement contemplates that Akerna and Exchangeco
will deposit in escrow certain Exchangeable Shares with the Escrow Agent, to be
contributed, held and distributed by the Escrow Agent subject to the terms and
conditions hereof;

 

AND WHEREAS the foregoing recitals are representations and statements of fact
made by the parties hereto and not by the Escrow Agent.

 

 

 

 

NOW, THEREFORE, THIS AGREEMENT WITNESSETH THAT, in consideration of the
foregoing recitals, the covenants and agreements hereinafter contained and other
good and valuable consideration (the receipt and sufficiency of which are hereby
acknowledged), the parties hereto agree as follows:

 

1. Definitions. For the purposes of this Agreement, the following terms shall
have the following meanings:

 

  (a) “Affiliate” has the meaning ascribed thereto under the Securities Act
(Ontario) and the rules, regulations and published policies made thereunder.

 

  (b) “Akerna Shares” means the shares in the common stock in the share capital
of Akerna.

 

  (c) “Ample Shareholders” means the holders of issued and outstanding shares in
the capital of Ample immediately prior to the Closing Time that are entitled to
receive Exchangeable Shares in accordance with the Arrangement Agreement and the
Plan of Arrangement.

 

(d) “Arrangement” means an arrangement under the OBCA on the terms and subject
to the conditions set out in the Plan of Arrangement, subject to any amendments
or any variations to the Plan of Arrangement made in accordance with the terms
of the Arrangement Agreement.

 

(e) “Business Day” means a day on which banks are generally open for the
transaction of commercial business in Toronto, Ontario, Calgary, Alberta or
Denver, Colorado but does not in any event include a Saturday or Sunday or
statutory holiday in Ontario, Alberta or Colorado.

 

(f) “Callco” means Akerna Canada Holdings Inc.

 

(g) “Claim Notice” means written notification of a Claim pursuant to the
Arrangement Agreement containing:

 

  (i) a description and the amount of Damages incurred or reasonably expected to
be incurred by Akerna or Exchangeco, as applicable; and

 

  (ii) a statement that Akerna or Exchangeco, as applicable, is entitled to
indemnification under Article 6 of the Arrangement Agreement for such Damages
and a reasonable explanation of the basis therefor.

 

(h) “Claims” means any claim by Akerna or Exchangeco for indemnification in
accordance with the Arrangement Agreement.

 

(i) “Closing Date” means July ___, 2020.

 

(j) “Closing Shares” means 2,306,202 Exchangeable Shares deposited into escrow
pursuant to this Agreement on the date hereof.

 

(k) “Closing Time” means the time at which the Arrangement becomes effective on
the Closing Date pursuant to the OBCA.

 

(l) “Court” means the Ontario Superior Court of Justice.

 

(m) “Damages” means any and all claims, debts, obligations and other liabilities
(whether absolute, accrued, contingent, fixed or otherwise, or whether known or
unknown, or due to become due or otherwise), diminution in value, monetary
damages, fines, fees, penalties, interest obligations, deficiencies, losses and
expenses (including amounts paid in settlement, interest, court costs,
reasonable fees and expenses of attorneys, accountants, financial advisors,
investigators, and other experts, and other reasonable expenses of litigation,
arbitration or other dispute resolution procedures).

 

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(n) “Deposited Shares” means, collectively, the Closing Shares and the Escrowed
Shares.

 

(o) “Escrowed Shares” means 329,457 Exchangeable Shares deposited into escrow
pursuant to this Agreement on the date hereof.

 

(p) “Exchangeco Articles” means the articles of incorporation of Exchangeco, as
may be amended by any articles of amendment.

 

(q) “Final Order” means an order issued by a court of competent jurisdiction,
accompanied by a written certification from counsel for the instructing party
attesting that such order is final and not subject to further proceedings or
appeal along with a written instruction from an authorized representative of
such instructing party given to effectuate such order and the Escrow Agent shall
be entitled to conclusively rely upon any such certification and instruction and
shall have no responsibility to review the order to which such certification and
instruction refers or to make any determination as to whether such order is
final;

 

(r) “Final Release Date” has the meaning specified in Section 7(b);

 

(s) “Joint Instructions” means joint, written instructions executed by each of
Akerna and the Shareholder Representative substantially in the formed attached
as Schedule “A”.

 

(t) “OBCA” means the Business Corporations Act, R.S.O. 1900, c. B.16, as
amended, including the regulations promulgated thereunder.

 

(u) “Person” means any individual, firm, partnership, joint venture, venture
capital fund, association, trust, trustee, executor, administrator, legal
personal representative, estate group, body corporate, corporation,
unincorporated association or organization, governmental entity, syndicate or
other entity, whether or not having legal status.

 

(v) “Plan of Arrangement” means the plan of arrangement set forth in Schedule
“B” to the Arrangement Agreement, as such plan of arrangement may be amended or
supplemented from time to time.

 

(w) “Resignation Date” has the meaning specified in Section 16(a).

 

(x) “Shareholder Correspondence” has the meaning specified in Section 6(b).

 

(y) “Trustee” means Odyssey Trust Company, acting in its capacity as trustee
pursuant to the Voting and Exchange Trust Agreement.

 

(z) “Unresolved Claims” means all Claims asserted against an Ample Shareholder
pursuant to the delivery of a Claim Notice in accordance with this Agreement and
the Arrangement Agreement prior to the Final Release Date and that are not
resolved as of the Final Release Date.

 

(aa) “Voting and Exchange Trust Agreement” means the Voting and Exchange Trust
Agreement entered into by Akerna, Exchangeco, Callco, the Trustee and the
Shareholder Representative as of the date hereof.

 

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2. Appointment of Escrow Agent. Akerna, Exchangeco and the Shareholder
Representative hereby appoint the Escrow Agent to act as agent on their behalf
pursuant to this Agreement, and the Escrow Agent hereby accepts such appointment
on the terms and conditions of this Agreement.

 

3. Delivery of the Escrowed Shares. Akerna and Exchangeco hereby deposit with
the Escrow Agent a total of 2,635,659 Exchangeable Shares, representing in the
aggregate the Deposited Shares. The Deposited Shares shall be registered in the
name of the Escrow Agent and shall be held and retained by the Escrow Agent
until released from escrow solely in accordance with the terms and conditions of
this Agreement.

 

4. Retention in Escrow. The Deposited Shares and all cash and all other
securities and property as may be held by the Escrow Agent from time to time in
accordance with the terms hereof, including, any securities or other property
that may be issued in connection with share splits, share dividends,
distributions, combinations, exchanges and like transactions affecting the
Deposited Shares (or any of them) shall be held by the Escrow Agent in escrow
pursuant to the terms hereof and for the limited purposes specified herein.
Unless otherwise expressly stated herein, the Deposited Shares shall not be
sold, assigned, hypothecated, alienated, released from escrow, transferred
within escrow, or otherwise in any manner dealt with, without the prior written
consent of the Shareholder Representative and Akerna being given to the Escrow
Agent.

 

5. Reorganizations, Dividends etc.

 

(a) If, during the period in which any of the Deposited Shares are held in
escrow pursuant to this Agreement, a share split or consolidation, share
dividend, recapitalization, exchange or similar transaction affecting the share
capital of Exchangeco occurs, then in each such event, the Deposited Shares so
affected and that are then held in escrow pursuant to this Agreement shall be
released and remitted by the Escrow Agent to such Person(s) in order to give
effect to such share split or consolidation, share dividend, recapitalization,
exchange or similar transaction.

 

(b) Subject to Section 10, any cash, securities or other property that is issued
from time to time with respect to any Deposited Shares or other property then
held in escrow pursuant to this Agreement shall be deposited in escrow with the
Escrow Agent and shall be held on the same terms as the Deposited Shares or
other property with respect to which such cash, securities or other property
shall have been delivered.

 

6. Voting of Deposited Shares

 

(a) Grant of Power of Attorney and Proxy. The Escrow Agent, as holder of record
of the Deposited Shares, to the extent that such shares are held in escrow
pursuant to this Agreement, hereby irrevocably appoints the Shareholder
Representative as its true, exclusive and lawful representative,
attorney-in-fact, agent and proxy:

 

  (i) to exercise any and all voting rights held by the Escrow Agent in its
capacity as a Beneficiary (as such term is defined in the Voting and Exchange
Trust Agreement) under the Voting and Exchange Trust Agreement, including,
without limitation, to direct and instruct the Trustee with respect to the
voting of the Special Voting Share (as such term is defined in the Voting and
Exchange Trust Agreement) in accordance with the Voting and Exchange Trust
Agreement and with respect to all rights granted to Beneficiaries under the
Voting and Exchange Trust Agreement respecting (A) the attendance at meetings of
the shareholders of Akerna and the voting of the Special Voting Share thereat,
and (B) the provision of any consents in writing that are sought by Akerna from
holders of Akerna Shares; and

 

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  (ii) to attend any meeting of the holders of Exchangeable Shares, including
any adjournment or postponement thereof, on behalf of the Escrow Agent, and to
exercise any and all rights with respect to the voting of the Deposited Shares
registered in the name of the Escrow Agent and held in escrow pursuant to this
Agreement, including the right to vote the Deposited Shares in respect of any
matter, question, proposal or proposition whatsoever that may properly come
before the holders of Exchangeable Shares at any meeting of Exchangeco or in any
consent sought by Exchangeco, as applicable, for such time as any Deposited
Shares remain in escrow pursuant to this Agreement.

 

(b) Delivery of Meeting Materials. Akerna and Exchangeco shall deliver to the
Shareholder Representative and each Ample Shareholder any notice or
correspondence (“Shareholder Correspondence”) required to be delivered to the
registered holders of Exchangeable Shares at the same time, in the same form and
on the same basis as Akerna, Exchangeco or the Trustee are required under
applicable law, by contract, or otherwise, to deliver such notice or other
correspondence to registered holders of Exchangeable Shares. Concurrently with
the delivery of any Shareholder Correspondence in respect of which any voting
rights (including any right to direct the voting of the Special Voting Share) or
consent rights attaching to the Exchangeable Shares shall arise, Akerna and
Exchangeco shall deliver to each Ample Shareholder:

 

  (i) a statement that such Ample Shareholder is entitled to instruct the
Shareholder Representative as to the exercise of voting rights (including any
right to direct the voting of the Special Voting Share) or consent rights
attaching to such portion of the Deposited Shares as the Shareholder
Representative shall determine in accordance with the Arrangement Agreement and
Plan of Arrangement;

 

  (ii) a form of direction whereby the Ample Shareholder may so direct and
instruct the Shareholder Representative; and

 

  (iii) a statement of the time by which such instructions must be received by
the Shareholder Representative in order to be binding upon them and the method
for revoking or amending any such instructions.

 

(c) Exercise of Voting Rights. The Shareholder Representative has been granted
the authority under the Arrangement Agreement and the Plan of Arrangement, in
its capacity as the representative, attorney-in-fact and agent for each Ample
Shareholder, to determine from time to time while the Deposited Shares (or any
of them) are held in escrow pursuant to this Agreement, the number (if any) of
all Deposited Shares in respect of which each Ample Shareholder shall be
entitled to provide instructions with respect to the exercise of any voting
rights (including any right to direct the voting of the Special Voting Share) or
any consent rights. The Shareholder Representative hereby agrees and covenants
that it shall exercise any voting rights (including any right to direct the
voting of the Special Voting Share) or consent rights attaching to each
Deposited Shares exclusively in accordance with the written instructions of the
Ample Shareholder that the Shareholder Representative has determined, in
accordance with the Arrangement Agreement and the Plan of Arrangement, is
entitled to provide instructions with respect to such Deposited Share.

 

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7. Release of Deposited Shares.

 

(a) On the Business Day that is six (6) months following the Closing Date,
provided that any Closing Shares remain subject to escrow at such time, Akerna
and the Shareholder Representative shall deliver Joint Instructions to the
Escrow Agent directing the release from escrow to the Ample Shareholders of that
number of Closing Shares equal to the lesser of (i) such number of Closing
Shares as is required to cause the total number of all Effective Time Shares (as
such term is defined in the Arrangement Agreement) plus Closing Shares delivered
to the Ample Shareholders under the Arrangement Agreement and this Agreement as
of such date to equal fifty percent (50%) of the total number of Up-front Shares
(as such term is defined in the Arrangement Agreement), and (ii) the number of
Closing Shares then held in escrow pursuant to this Agreement and are not then
subject to an Unresolved Claim in respect of fraud.

 

(b) On the Business Day that is nine (9) months following the Closing Date,
provided that any Closing Shares remain subject to escrow at such time, Akerna
and the Shareholder Representative shall deliver Joint Instructions to the
Escrow Agent directing the release from escrow to the Ample Shareholders of that
number of Closing Shares equal to the lesser of (i) such number of Closing
Shares as is required to cause the total number of all Effective Time Shares (as
such term is defined in the Arrangement Agreement) plus Closing Shares delivered
to the Ample Shareholders under the Arrangement Agreement and this Agreement as
of such date to equal seventy five percent (75%) of the total number of Up-front
Shares (as such term is defined in the Arrangement Agreement), and (ii) the
number of Closing Shares then held in escrow pursuant to this Agreement and are
not then subject to an Unresolved Claim in respect of fraud.

 

(c) On the Business Day that is twelve (12) months following the Closing Date
(the “Final Release Date”), provided that any Closing Shares or Escrowed Shares,
as the case may be, remain subject to escrow at such time, Akerna and the
Shareholder Representative shall deliver Joint Instructions to the Escrow Agent
directing the release from escrow to the Ample Shareholders of:

 

  (i) all, but not less than all, of the Closing Shares that are held in escrow
pursuant to this Agreement and are not then subject to an Unresolved Claim in
respect of fraud; and

 

  (ii) all, but not less than all, of the Escrowed Shares held in escrow
pursuant to this Agreement and are not then subject to an Unresolved Claim.

 

(d) Upon receipt by the Escrow Agent of Joint Instructions from time to time
directing the release from escrow of Deposited Shares in accordance with Section
7(a), 7(b), 7(c) or 7(d), the Escrow Agent is hereby irrevocably authorized and
directed, in each case, to release, transfer and deliver such Deposited Shares
in accordance with Section 9(a).

 

8. Indemnification Claims.

 

(a) If Akerna or Exchangeco provides to the Shareholder Representative a Claim
Notice on or before the Final Release Date and otherwise in accordance with
Section 6.3(a) of the Arrangement Agreement, Akerna or Exchangeco, as
applicable, shall concurrently provide a copy of the same Claim Notice to the
Escrow Agent.

 

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(b) If in respect of any Claim Notice that has been received by the Escrow Agent
on or before 5:00 p.m. (Eastern Standard Time) on the Final Release Date, then
the Escrow Agent shall hold the portion of the Deposited Shares that are subject
to such Claim Notice until the Escrow Agent receives either (i) Joint
Instructions authorizing the release to Akerna and/or Exchangeco of all or any
portion of the Deposited Shares that are subject to such Claim Notice, or (ii) a
Final Order directing the release to Akerna and/or Exchangeco of all or any
portion of the portion of the Deposited Shares that are subject to such Claim
Notice. Within five (5) Business Days after the Escrow Agent’s receipt of such
Joint Instructions or Final Order, as the case may be, the Escrow Agent shall
release from escrow the portion of the Deposited Shares required to be released
in accordance with such Joint Instructions or Final Order.

 

(c) On the Final Release Date, the Shareholder Representative and Akerna shall
jointly provide a certificate to the Escrow Agent setting forth the aggregate
amount of all Unresolved Claims as of the Final Release Date based on all Claim
Notices submitted in accordance with this Agreement and the Arrangement
Agreement prior to the Final Release Date.

 

(d) Following the Final Release Date, within five (5) Business Days after the
Escrow Agent’s receipt of Joint Instructions or Final Order, in either case,
containing the final determination of any Unresolved Claims, the Escrow Agent
shall (i) first, distribute from the Deposited Shares to Akerna and/or
Exchangeco an amount equal to the lesser of (A) such portion of the Deposited
Shares to be released to Akerna and/or Exchangeco pursuant to such Joint
Instructions or Final Order, as the case may be, and (B) the portion of the
Deposited Shares remaining in escrow pursuant to this Agreement and available to
satisfy such Claim at such time, and (ii) second, after distributing any
Deposited Shares pursuant to Section 8(d)(i), distribute from the Deposited
Shares to the Ample Shareholders the remaining amount of any Deposited Shares
then held by the Escrow Agent.

 

9. Allocation of Released Shares.

 

(a) All Deposited Shares released by the Escrow Agent to the Ample Shareholders
in accordance with the terms of this Agreement shall be transferred to such
Ample Shareholders in such proportions as the Shareholder Representative shall
direct in writing, which direction shall be provided by the Shareholder
Representative to the Escrow Agent within two (2) Business Days of the date on
which any Deposited Shares are directed to be released to the Ample Shareholders
pursuant to any Joint Instructions or Final Order.

 

(b) Upon the release and transfer of Deposited Shares to Ample Shareholders
pursuant to this Agreement, each of Akerna and Exchangeco shall take all steps
reasonably required to facilitate such transfer, including obtaining all
approvals and consents, and executing all such documents and instruments, as may
be reasonably required to complete the release and transfer of Deposited Shares
to the Ample Shareholders (or any of them) in accordance with this Agreement.

 

10. Exchange of Exchangeable Shares.

 

(a) During such time as any Deposited Shares are held in escrow pursuant to this
Agreement, neither the Escrow Agent nor the Shareholder Representative shall be
required to act upon or otherwise give effect to any request by any Ample
Shareholder that the Escrow Agent or Shareholder Representative request or
otherwise cause the exchange of any Deposited Shares at the option or election
of the registered holder thereof for any shares in the capital of Akerna,
whether pursuant to the Voting and Exchange Trust Agreement or in accordance
with the terms of Exchangeco Articles.

 

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(b) If at any time, Exchangeable Shares comprising part of the Deposited Shares
subject to escrow hereunder are to be exchanged pursuant to a call right granted
to Akerna or any of its Affiliates pursuant to the Voting and Exchange Trust
Agreement, the Plan of Arrangement or the terms of Exchangeco Articles, Akerna
shall notify the Escrow Agent in writing with a simultaneously delivered notice
from Akerna or its Affiliates with respect to the exercise of such call right.
Subject to Section 10(c), the Escrow Agent shall deliver the Akerna Shares to be
issued in exchange for the Exchangeable Shares to the Person designated in the
notice in the manner and at the time and place specified in the notice. The
terms and procedures for any such exchange shall be as set forth in the Plan of
Arrangement, the Exchangeco Articles and the Voting and Exchange Trust Agreement
(copies of which have been delivered to the Escrow Agent), as applicable.

 

(c) Within five (5) Business Days following the exchange of any Deposited Shares
for shares in the capital of Akerna (or any other Person) pursuant to the
exercise by Akerna or any of its Affiliates of any call right provided for the
Plan of Arrangement, the Exchangeco Articles or the Voting and Exchange Trust
Agreement, Akerna and the Shareholder Representative shall deliver Joint
Instructions to the Escrow Agent instructing the Escrow Agent to release to the
Ample Shareholders all but not less than all of the Deposited Shares that are
then held in escrow pursuant to this Agreement and are not then subject to an
Unresolved Claim.

 

11. Termination of Escrow. Upon release and distribution by the Escrow Agent of
all Deposited Shares and any other property subject to escrow and/or
distribution pursuant to this Agreement, this Agreement shall terminate,
provided, however, that the termination of this Agreement shall be without
prejudice to any rights and obligations accrued prior to such termination and
shall not in any way limit the indemnification obligations of the Ample
Shareholders as set out in the Arrangement Agreement.

 

12. Shareholder Representative. The Shareholder Representative, or any successor
hereafter appointed, shall be discharged of its duties hereunder upon
appointment of a successor Shareholder Representative appointed in accordance
with applicable law. Each such successor Shareholder Representative shall have
all the power, authority, rights and privileges conferred upon the original
Shareholder Representative, and the term “Shareholder Representative” as used
herein shall be deemed to include such successor Shareholder Representative.

 

13. Responsibility of the Escrow Agent; Indemnification.

 

(a) The parties hereto acknowledge and agree that the Escrow Agent acts
hereunder as a depositary only and (i) shall not be responsible or liable in any
manner whatsoever for the sufficiency, correctness, genuineness or validity of
any instrument, statement, certificate, request or other document deposited with
it (including, without limitation, the Arrangement Agreement), for the form or
execution of such documents, for the identity, authority or right of any Person
or party executing or depositing such instruments or for determining or
compelling compliance therewith, and shall not otherwise be bound thereby;
(ii) shall be obligated only for the performance of such duties as are expressly
and specifically set forth in this Agreement on its part to be performed, and no
implied duties or obligations of any kind shall be read into this Agreement
against or on the part of the Escrow Agent; (iii) shall not be required to take
notice of any default or to take any action with respect to such default;
(iv) may rely on and shall be protected in acting or refraining from acting upon
any written notice, instruction (including, without limitation, wire transfer
instructions, whether incorporated herein or provided in a separate written
instruction), instrument, statement, certificate, request or other document
furnished to it hereunder and believed by it to be genuine and to have been
signed or presented by the proper Person, and shall have no responsibility for
determining the accuracy thereof; and, (v) may employ and consult counsel
satisfactory to it, including in-house counsel for any of the parties hereto,
and the opinion of such counsel shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted by it hereunder
in good faith and in accordance with the opinion of such counsel.

 

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(b) The Escrow Agent may employ such counsel, accountants, engineers,
appraisers, other experts, agents, agencies and advisors as it may reasonably
require for the purpose of discharging its duties under this Agreement, and the
Escrow Agent may act and shall be protected in acting or not acting in good
faith on the opinion or advice or on information obtained from any such parties
and shall not be responsible for any misconduct on the part of any of them. The
reasonable costs of such services shall be added to and be part of the Escrow
Agent’s fee hereunder.

 

(c) The Escrow Agent retains the right not to act and shall not be held liable
for refusing to act unless it has received clear and reasonable documentation
which complies with the terms of this Agreement. Such documentation must not
require the exercise of any discretion or independent judgment.

 

(d) No provision of this Agreement shall require the Escrow Agent to expend or
risk its own funds or otherwise incur financial liability in the performance of
its duties or the exercise of any of its rights or powers unless indemnified and
funded as provided for herein, other than as a result of its own gross
negligence or bad faith.

 

(e) The Escrow Agent shall not be liable for any error of judgment, or for any
act done or step taken or omitted by it in good faith, or for any mistake of
fact or law, or for anything which it may do or refrain from doing in connection
herewith, except for its own gross negligence or wilful misconduct.

 

(f) The Escrow Agent shall incur no liability with respect to the delivery or
non-delivery of any cash or securities whether delivered by hand, wire transfer,
registered mail or bonded courier.

 

(g) The forwarding of a cheque by the Escrow Agent will satisfy and discharge
the liability for any cash amounts due to the extent of the sum or sums
represented thereby (plus the amount of any tax deducted or withheld as required
by law) unless such cheque is not honoured on presentation; provided that in the
event of non-receipt of such cheque by the payee, or loss or destruction
thereof, the Escrow Agent upon being furnished with reasonable evidence of such
non-receipt, loss or destruction and indemnity reasonably satisfactory to it,
will issue to such payee a replacement cheque for the amount of such cheque.

 

(h) Akerna shall pay the costs and expenses reasonably incurred by the Escrow
Agent’s services hereunder, in connection with the administration of the escrow
created hereby or the performance or observance of its duties hereunder; covered
by the remuneration are included, without limitation, all out-of-pocket expenses
and disbursements incurred or made by the Escrow Agent in the administration of
its services and duties created hereby, in excess of its compensation for normal
services or not (including the reasonable fees and disbursements of its outside
counsel and other outside advisors required for discharge of its duties
hereunder). Any amount owing under this Section 13(h) and unpaid thirty (30)
days after request for such payment will bear interest from the expiration of
such thirty (30) days at a rate per annum equal to the then current rate charged
by the Escrow Agent, payable on demand. The Escrow Agent is not required to
effect any partial or full release unless its fees and expenses are paid in
full. The parties hereto further agree that any residual fees or expenses
incurred by the Escrow Agent after termination of the Agreement will be
reimbursed by Akerna.

 

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(i) Akerna agrees to indemnify the Escrow Agent and its officers, directors,
employees, agents, successors and assigns and hold it and them harmless from and
against any loss, fee, claim, demand, penalty, liability, damage, cost and
expense of any nature incurred by the Escrow Agent and its officers, directors,
employees, agents, successors and assigns arising out of or in connection with
this Agreement or with the administration of its duties hereunder, including but
not limited to, reasonable attorneys’ fees and other costs and expenses of
defending or preparing to defend against any claim of liability, unless and
except to the extent such loss, liability, damage, cost and expense shall be
caused by the Escrow Agent’s or its officers’, directors’, employees’ agents’,
successors’ or assigns’ gross negligence or wilful misconduct. The foregoing
indemnification and agreement to hold harmless shall survive the release of all
property held in escrow pursuant to this Agreement, the resignation or removal
of the Escrow Agent or the termination of this Agreement. Notwithstanding the
foregoing or any other provision of this Agreement, any liability of the Escrow
Agent shall be limited, in the aggregate, to the amount of annual retainer fees
paid by Akerna to the Escrow Agent under this Agreement in the twelve (12)
months immediately prior to the Escrow Agent receiving the first notice of the
claim.

 

(j) Notwithstanding any other provision of this Agreement, and whether such
losses or damages are foreseeable or unforeseeable, the Escrow Agent shall not
be liable under any circumstances whatsoever for any: (i) breach by any other
party of securities law or other rule of any securities regulatory authority;
(ii) lost profits; or (iii) special, indirect, incidental, consequential,
exemplary, aggravated or punitive losses or damages.

 

(k) The Escrow Agent does not have any interest in the Deposited Shares but is
serving as escrow agent only and having only possession thereof.

 

(l) The Escrow Agent shall have no duties except those which are expressly set
forth herein, and it shall not be bound by any notice of a claim or demand with
respect to, or any waiver, modification, amendment, termination or rescission of
this Agreement, unless received by it in writing, and signed by the parties
hereto and if its duties herein are affected, unless it shall have given its
prior written consent thereto.

 

(m) The Escrow Agent accepts the duties and responsibilities under this
Agreement as agent and no trust is intended to be, or is or will be, created
hereby and the Escrow Agent shall owe no duties hereunder as trustee.

 

(n) The Escrow Agent shall have no responsibility for seeking, obtaining,
compiling, preparing or determining the accuracy of any information or document,
including the representative capacity in which a party purports to act, that the
Escrow Agent receives as a condition to a release from escrow or a transfer
of the Deposited Shares or any other property subject to escrow.

 

(o) The Escrow Agent shall have no responsibility for escrow securities that it
has released to a securityholder or at a securityholder’s direction according to
this Agreement.

 

(p) The Escrow Agent is authorized to hold such escrow securities in electronic
or uncertificated form only, pending release of such securities from escrow.

 

(q) The Escrow Agent shall have no responsibility with respect to any escrow
securities in respect of which no share certificate or other evidence or
electronic or uncertificated form of these securities has been delivered to it,
or otherwise received by it. 

 

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(r) The Escrow Agent shall have no responsibility or liability for any
diminution in the value of any of the Deposited Shares or any securities which
may be deposited with it hereunder.

 

(s) This Section 13 shall survive notwithstanding any termination of the
Agreement or the resignation or removal of the Escrow Agent.

 

14. Dispute Resolution. It is understood and agreed that should any dispute
arise with respect to the delivery, ownership, right of possession and/or
disposition of the Deposited Shares or any other property subject to escrow
hereunder, or should any claim be made against the Escrow Agent or upon such
shares by a third party, the Escrow Agent, upon receipt of notice of such
dispute or claim, is authorized and shall be entitled (at its sole option and
election) to retain in its possession without liability, all or any of said
escrowed shares, until such dispute shall have been settled either by the mutual
written agreement of the parties involved, or by a final order, decree or
judgment of a court or arbitrator of competent jurisdiction, the time for
perfection of an appeal of such order, decree or judgment having expired. A copy
of any such settlement or final order, decree or judgment of a court or
arbitrator of competent jurisdiction shall be delivered to the Escrow Agent by
Akerna and the Shareholder Representative forthwith upon receipt thereof. The
Escrow Agent may, but shall be under no duty whatsoever to, institute or defend
any legal proceedings which relate to the Deposited Shares or any other property
subject to escrow hereunder. In the event that the Escrow Agent shall become
involved in any arbitration or litigation relating to the Deposited Shares or
any other property subject to escrow hereunder, the Escrow Agent is authorized
to comply with any decision reached through such arbitration or litigation.

 

15. Arbitration. Any disputes with respect to this Agreement shall be resolved
by arbitration and any party may demand by written notice to the other party
that the matter be submitted to arbitration. The notice shall set out the
reasons for the dispute and reasonable details to support the dispute. The
parties hereto shall cooperate in completing any arbitration as expeditiously as
possible, the procedure to commence no later than thirty (30) days from the date
the notice was sent, and the arbitrator may hire such experts as may appear to
be appropriate. All of the costs and expenses of the arbitration shall be borne
equally by Akerna and the Shareholder Representative. Any award rendered by the
arbitrator shall be final and binding on the parties.

 

16. Resignation of Escrow Agent; Successor by Merger.

 

(a) The Escrow Agent may at any time resign as such, subject to this Section 16,
by delivering written notice of resignation to the other parties to this
Agreement and by delivering all Deposited Shares subject to escrow (less any
portion thereof previously distributed in accordance with this Agreement) to any
successor escrow agent designated by Akerna and the Shareholder Representative,
jointly, or by a court of competent jurisdiction, whereupon the Escrow Agent
shall be discharged of and from any and all further obligations arising in
connection with this Agreement. The resignation of the Escrow Agent will take
effect on the earlier to occur of (the “Resignation Date”): (i) the appointment
of a successor escrow agent as aforesaid or by a court of competent
jurisdiction; or (ii) the day which is thirty (30) days after the date of
delivery of the Escrow Agent’s written notice of resignation to the other
parties hereto, or such shorter notice as the parties accept as sufficient. If
the Escrow Agent has not received written notice of the designation of a
successor escrow agent by the Resignation Date, the Escrow Agent’s sole
responsibility after such time shall be to retain and safeguard the Deposited
Shares and all other property subject to escrow until receipt of written notice
of the designation of a successor escrow agent hereunder or pursuant to a final
non-appealable order of a court of competent jurisdiction. If a successor escrow
agent has not been appointed within ninety (90) days of the date of the delivery
of its written notice of resignation, the Escrow Agent shall deliver the
Deposited Shares and all other property subject to escrow (less any portion
thereof previously distributed in accordance with this Agreement) to the legal
counsel designated by Akerna and the Shareholder Representative, jointly, and
all of the Escrow Agent’s duties and obligations under this Agreement shall
thereupon cease immediately. Failing such designation by Akerna and the
Shareholder Representative, jointly, the Escrow Agent shall deliver such
Deposited Shares to a court of competent jurisdiction directed to hold such
shares for the benefit of Akerna and the Shareholder Representative, whereupon
this Agreement shall terminate and the Escrow Agent shall have no further duties
and obligations under this Agreement. Akerna and the Shareholder Representative,
acting together, shall have power at any time to remove the existing Escrow
Agent and to appoint a successor escrow agent.

 

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(b) If any Deposited Shares and all other property subject to escrow or other
property is to be released hereunder to a party who has become bankrupt, has
gone into liquidation or has otherwise become incapable of performing their
rights and responsibilities under this Agreement, the Escrow Agent shall
forthwith deliver such shares to the estate and other representatives of such
party. If all of the parties hereunder have become bankrupt, have gone into
liquidation or have otherwise become incapable of performing their rights and
responsibilities under this Agreement, the Escrow Agent shall forthwith deliver
the Deposited Shares and all other property subject to escrow to the estate and
other representatives of such party, and provide written notice to all of the
other parties to this Agreement of the disposition of such shares. Upon such
delivery of shares, this Agreement shall terminate and the Escrow Agent shall
have no further duties and obligations.

 

(c) In the event of the Escrow Agent resigning or being removed as aforesaid or
being dissolved, becoming bankrupt, going into liquidation or otherwise becoming
incapable of acting hereunder, Akerna and the Shareholder Representative,
jointly, shall forthwith appoint a successor escrow agent; failing such
appointment by Akerna and the Shareholder Representative, the retiring Escrow
Agent, acting alone, may apply, at the expense of Akerna and the Shareholder
Representative, jointly, to a justice of the Court on such notice as such
justice may direct, for the appointment of a successor escrow agent; but any
successor escrow agent so appointed by the Court shall be subject to removal as
aforesaid.

 

(d) Any successor escrow agent appointed under any provision of this Section 16
shall be a corporation authorized to carry on the business of a trust company in
one or more of the provinces of Canada and, if required by the applicable
legislation for any other jurisdiction, in such other jurisdictions. On any such
appointment, the successor escrow agent shall be vested with the same powers,
rights, duties and responsibilities as if it had been originally named herein as
Escrow Agent hereunder. At the request of Akerna and the Shareholder
Representative, or the successor escrow agent, the retiring Escrow Agent, upon
payment of the amounts, if any, due to it pursuant to this Agreement, including
any amounts owing to it in respect to outstanding fees, disbursements and
interest thereon, shall duly assign, transfer and deliver to the successor
escrow agent all property and money held, and all records kept, by the retiring
Escrow Agent hereunder or in connection herewith.

 

(e) Any corporation into or with which the Escrow Agent may be merged or
consolidated or amalgamated, or any corporation resulting therefrom to which the
Escrow Agent shall be a party, or any corporation succeeding to all or
substantially all of the corporate trust business of the Escrow Agent shall be
the successor to the Escrow Agent hereunder without any further act on its part
or any of the parties hereto, provided that such corporation would be eligible
for appointment as a successor escrow agent hereunder.

 

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17. Anti-money Laundering.

 

(a) Each party to this Agreement (in this paragraph referred to as a
“representing party”), other than the Escrow Agent, hereby represents to the
Escrow Agent that any account to be opened by, or interest to held by, the
Escrow Agent in connection with this Agreement, for or to the credit of such
representing party, either: (i) is not intended to be used by or on behalf of
any third party (other than an Ample Shareholder); or (ii) is intended to be
used by or on behalf of a third party, in which case such representing party
hereby agrees to complete, execute and deliver forthwith to the Escrow Agent a
declaration, in the Escrow Agent’s prescribed form or in such other form as may
be satisfactory to it, as to the particulars of such third party (other than an
Ample Shareholder).

 

(b) The Escrow Agent shall retain the right not to act and shall not be liable
for refusing to act if, due to a lack of information or for any other reason
whatsoever, the Escrow Agent, in its sole judgment, determines that such act
might cause it to be in non-compliance with any applicable anti-money
laundering, anti-terrorist or economic sanctions legislation, regulation or
guideline. Further, should the Escrow Agent, in its sole judgment, determine at
any time that its acting under this Agreement has resulted in its being in
non-compliance with any applicable anti-money laundering, anti-terrorist or
economic sanctions legislation, regulation or guideline, then it shall have the
right to resign on ten (10) days written notice to the other parties to this
Agreement, provided: (i) that the Escrow Agent’s written notice shall describe
the circumstances of such non-compliance; and (ii) that if such circumstances
are rectified to the Escrow Agent’s satisfaction within such ten (10) day
period, then such resignation shall not be effective.

 

18. Privacy. The parties acknowledge that the Escrow Agent may, in the course of
providing services hereunder, collect or receive financial and other personal
information about such parties and/or their representatives, as individuals, or
about other individuals related to the subject matter hereof, and use such
information for the following purposes:

 

(a) to provide the services required under this Agreement and other services
that may be requested from time to time;

 

(b) to help the Escrow Agent manage its servicing relationships with such
individuals;

 

(c) to meet the Escrow Agent’s legal and regulatory requirements; and

 

(d) if Social Insurance Numbers are collected by the Escrow Agent, to perform
tax reporting and to assist in verification of an individual’s identity for
security purposes.

 

(e) Each party acknowledges and agrees that the Escrow Agent may receive,
collect, use and disclose personal information provided to it or acquired by it
in the course of this Agreement for the purposes described above and, generally,
in the manner and on the terms described in its privacy policies, which the
Escrow Agent shall make available on its website, www.odysseytrust.com, or upon
request, including revisions thereto. The Escrow Agent may transfer personal
information to other companies in or outside of Canada that provide data
processing and storage or other support in order to facilitate the services it
provides.

 

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19. Notices. Any notice, direction or other communication given under this
Agreement shall be in writing and given by delivering it or sending it by
personal delivery, nationally recognized overnight courier (with all fees
prepaid), email (with confirmation of transmission) or certified or registered
mail (in each case, return receipt requested, postage prepaid), addressed:

 

to Akerna and Exchangeco at:  

Akerna Corp.
1601 Arapahoe Street
Denver, CO 80202

 

              Attention: John Fowle, Chief Financial Officer
              Email: John.fowle@akerna.com     With a copy to Dentons Canada LLP
(which copy shall not constitute notice hereunder) at:  

Dentons Canada LLP
15th Floor, Bankers Court, 850 – 2nd Street S.W.
Calgary, Alberta T2P 0R8

 

              Attention: Bennett Wong               Email:
Bennett.wong@dentons.com  

to the Shareholder Representative at:

 

John Prentice

14A Bingham Ave.

Toronto, ON M4E 3P9

 

              Attention: John Prentice               Email:
john.prentice@ampleorganics.com     With a copy to Dentons Canada LLP (which
copy shall not constitute notice hereunder) at:

 

Dentons Canada LLP
77 King Street West, Suite 400
Toronto-Dominion Centre
Toronto, Ontario M5K 0A1

 

 

              Attention: Eric Foster               Email:
Eric.foster@dentons.com     to the Escrow Agent at:

 

Odyssey Trust Company

1230, 300 5th Avenue S.W.

Calgary, Alberta T2P 3C4

 

              Attention: VP, Corporate Trust               Email:
Corptrust@odysseytrust.com

 

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Any such communication shall be deemed to have been validly and effectively
given and received (a) if sent by personal delivery or by courier (all fees
prepaid) on the date of actual receipt by the receiving party; (b) if sent by
email on the date of transmission if a Business Day or if not a Business Day or
after 5:00 p.m. (Eastern Standard Time) on the date of transmission, on the next
following Business Day; or (c) if sent by certified or registered mail (postage
prepaid) on the date indicated in the return receipt. Any party to this
Agreement may change its address for service from time to time by notice given
in accordance with the foregoing and any subsequent notice shall be sent to such
party at its changed address.

 

20. Miscellaneous.

 

(a) This Agreement may be executed in any number of counterparts and any party
hereto may execute any such counterpart by facsimile (followed by the originally
executed document forwarded promptly thereafter to the other party hereto), each
of which when executed and delivered shall be deemed to be an original and all
of which counterparts taken together shall constitute but one and the same
instrument. This Agreement shall become binding when one or more counterparts
taken together shall have been executed and delivered by all of the parties. It
shall not be necessary in making proof of this Agreement or any counterpart
hereof to produce or account for any of the other counterparts.

 

(b) This Agreement or any provision hereof may be amended or waived only by
written instrument duly signed by the party against whom such amendment or
waiver is sought to be enforced.

 

(c) No waiver of any of the provisions of this Agreement shall be deemed to
constitute a waiver of any other provision (whether or not similar), nor shall
such waiver be binding unless executed in writing by the party to be bound by
the waiver.

 

(d) No failure on the part of Akerna, Exchangeco or the Shareholder
Representative to exercise, and no delay in exercising, any right under this
Agreement shall operate as a waiver of such right; nor shall any single or
partial exercise of any such right preclude any other or further exercise of
such right or the exercise of any other right.

 

(e) If one or more of the provisions hereof shall for any reason be held to be
invalid, illegal or unenforceable in any respect under applicable law, such
invalidity, illegality or unenforceability shall not affect any other provision
hereof, and this Agreement shall be construed as if such invalid, illegal or
unenforceable provision had never been contained herein, and the remaining
provisions hereof shall remain in full force and effect.

 

(f) This Agreement is for the sole and exclusive benefit of the parties hereto,
and nothing in this Agreement, express or implied, is intended to confer or
shall be construed as conferring upon any other Person any rights, remedies or
any other type or types of benefits.

 

(g) No party may assign its rights hereunder without the prior written consent
of the other parties.

 

(h) This Agreement shall enure to the benefit of, and be binding upon, the
parties hereto and their respective successors and permitted assigns.

 

(i) This Agreement shall be governed by and interpreted and enforced in
accordance with the laws of the Province of Ontario and the federal laws of
Canada applicable therein.

 

(j) The Schedules attached to this Agreement shall, for all purposes of this
Agreement, form an integral part of it. This Agreement shall override the
Schedules attached hereto to the extent of any inconsistency.

 

(k) Any reference to time of day or date means the local time or date in
Toronto, Ontario, Canada.

 

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21. Force Majeure. Except for the payment obligations of Akerna contained
herein, none of the parties shall be liable to the other, or held in breach of
this Agreement, if prevented, hindered, or delayed in the performance or
observance of any provision contained herein by reason of act of God, strikes,
lockouts, riots, terrorism, acts of war, epidemics, governmental action or
judicial order, earthquakes, or any other similar causes (including, but not
limited to, mechanical, electronic or communication interruptions, disruptions
or failures). Performance times under this Agreement shall be extended for a
period of time equivalent to the time lost because of any delay that is
excusable under this Section 21.

 

22. Interpretation.

 

(a) The division of this Agreement into Sections, subsections and other portions
and the insertion of headings are for convenience of reference only and will not
affect the construction or interpretation hereof. Unless otherwise indicated,
all references to a “Section” followed by a number and/or a letter refer to the
specified Section or subsection of this Agreement.

 

(b) Unless the context otherwise requires, in this Agreement, words importing
the singular number include the plural and vice versa, and words importing the
use of any gender include all genders. If a word is defined in this Agreement a
grammatical derivative of that word will have a corresponding meaning. The words
“include”, “includes” and “including” shall be deemed to be followed by the
words “without limitation”.

 

(c) Whenever any payment shall be due, any period of time shall begin or end,
any calculation is to be made or any other action is to be taken on, or as of,
or from a period ending on, a day other than a Business Day, such payment shall
be made, such period of time shall begin or end, and such other actions shall be
taken, as the case may be, on, or as of, or from a period ending on, the next
succeeding Business Day.

 

(d) All sums of money that are referred to in this Agreement are expressed in
lawful money of Canada unless otherwise noted.

 

 

 

 

[Remainder of this page left intentionally blank]

 

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

 

  AKERNA CORP.       By: /s/ John Fowle     Authorized Signing Officer        
Akerna Canada Ample Exchange Inc.       By: /s/ Jessica Billingsley    
Authorized Signing Officer         /s/ John Prentice   John Prentice, in his
capacity as Shareholder  Representative         ODYSSEY TRUST COMPANY        
By: /s/ Dan Sander     Authorized Signing Officer         By: /s/ Amy Douglas  
  Authorized Signing Officer

 

 

 

[Escrow Agreement]

 

- 17 -

 

 

SCHEDULE A

 

Form of Joint Instruction

 

 

Date: ____________, 20__

 

 

TO: Odyssey Trust Company (“Escrow Agent”)

 

Pursuant to the Escrow Agreement entered into as of July ___, 2020 by and among
Akerna Corp. (“Akerna”), Akerna Canada Ample Exchange Inc. (“Exchangeco”), John
Prentice (“Shareholder Representative”) and the Escrow Agent (the “Escrow
Agreement”), you are hereby instructed to release out of the Deposited Shares
(as defined in the Escrow Agreement), the following amount of shares:
____________________________.

 

  AKERNA CORP.       By:     Authorized Signing Officer          Akerna Canada
Ample Exchange Inc.         By:       Authorized Signing Officer              

John Prentice, in his capacity as Shareholder Representative

 

 

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