Exhibit 10.17


 


 


 


 





CONFIDENTIAL
- Licensed Producer / Licensed Processor Sales Agency Agreement


 





This SALES AGENCY AGREEMENT
(“Agreement”) is made and entered into effect as of the December 12th 2018, by and between Target
Group Inc., a corporation existing under the laws of Delaware with its principal office and mailing address at 55 Administration
Road, Unit 13, Concord, Ontario, L4K4G9,  (hereinafter “Brand Owner”), and  Cannavolve Inc
(Corporation #1056814-7), organized and existing under the laws of the province of Ontario, with its principal office and mailing
address at 293 Laird Avenue, Toronto, Ontario, M4G 3X6, (hereinafter called “The Agent”)


 


W I T N E S S E
T H:








 


             
WHEREAS, Brand Owner produces and markets non-medical cannabis, non-medical cannabis based products listed in Schedule
A attached hereto as a part hereof (hereinafter called “Products”), and it desires to grant The
Agent the exclusive right to sell the Products in all of Canada (hereinafter called the “Territory”),
the whole in accordance with and subject to the terms herein set forth; and





 


             
WHEREAS, The Agent is in the business of selling, and marketing non-medical cannabis, non-medical cannabis-based
products or non-medical cannabis accessories in the Territory, and maintains all government licenses, permits, and
authorizations required to act as a The Agent under this Agreement, and it is willing to accept such
appointment by Brand Owner, all on the terms and conditions as hereinafter set forth. 


 


             
NOW THEREFORE, in consideration of the premises and terms, conditions, covenants, and agreements hereinafter set forth, the parties
agree as follows:


 


 


 


1.       APPOINTMENT –
Subject to all of the provisions of this Agreement, Brand Owner hereby appoints The Agent as
its exclusive agent to market and sell the Products in the Territory, but not elsewhere, during the term of this Agreement,
and The Agent accepts such appointment on the terms and conditions contained herein.  Throughout the term
of this Agreement, The Agent shall use its best efforts to promote and sell the Products in
the Territory. Remuneration for said service as outlined in Schedule B.


 






    CANNAVOLVE
INC. 293 Laird Drive Toronto Ontario Canada M4G 3X6 - East 416.875.1294 - West 778.995.9310 WWW.CANNAVOLVE.CA


     


    

  




Nothing herein contained shall be deemed to restrict or otherwise impair or impede the right or ability of Brand Owner and/or
its affiliates to market sell, package, label, appoint additional persons as The Agents of the Products, or otherwise
enter into any arrangements or agreements with respect to the Products anywhere else in the world other than
the Territory.  The Agent or any of its affiliates shall not knowingly supply Products to
any person within the territory for resale outside the territory.


 


2.       PERIOD –
The initial term of this Agreement shall commence on December 12th, 2018 and shall continue for a period
of two (2) years (the “Initial Term”) A “Contract Year” as the term is used in this Agreement shall
consist of consecutive periods of twelve (12) calendar months.  The term of this Agreement may be extended
for two (2) additional years (“Renewal Term”), the Renewal Term to commence after the Initial
Term, provided that neither party is in default in the performance of this Agreement, or is not terminated by either
party.


  


3.       TERMS –
Exclusive distribution rights to the Products in the Territory have been granted to the The
Agent based on the following transactional terms:


 


a.       Brand
Owner warrants that the Products sold to provincial regulatory boards and their designated retail customers,
represented by The Agent are merchantable and have been produced in accordance with federally regulated non-medical
cannabis industry standards.  Products’ specifications meet federal and provincial guidelines, and any guidelines,
requirements, and/or regulations that govern non-medical cannabis production in the Products’ country of origin and that
where it is distributed.  Brand Owner further warrants Products are free from defects in production or packaging
and will be liable for any such defects.   


 


4.       TERMINATION
OF AGREEMENT 


 


a.       This
agreement shall terminate forthwith without notice if:


[i]  either party shall become insolvent, liquidate, become the debtor in any bankruptcy or equivalent proceeding, whether
voluntary or involuntary, enter into any arrangement with its creditors for payment of its debts by composition or otherwise,
make assignment with its creditors or if a receiver shall be appointed for either party ceases to engage in the business contemplated
by this Agreement for any reason; or 



[ii] the government of the country in which either party is located or where the Products are made or any branch thereof,
enacts any laws or promulgates any codes or regulations whereby export, import, manufacture, sale, market or purchase non-medical
cannabis products shall be prohibited or shall be reversed to such government or agency or instrumentality thereof.


 






    CANNAVOLVE
INC. 293 Laird Drive Toronto Ontario Canada M4G 3X6 - East 416.875.1294 - West 778.995.9310 WWW.CANNAVOLVE.CA


     


    




 


 


b.       In
addition to other rights of termination under paragraph 5 hereof, this Agreement may be terminated by the aggrieved
party on the occurrence of any of the following events (“Events of Default”)




[i]  either party is in material or repeated breach of any of the other terms and conditions of this Agreement,
or otherwise fails to observe or becomes unable to perform any terms of this Agreement



[ii] either party fails to procure or to hold in good standing any governmental license, permit or other authority necessary and
required to manufacture, export, import, purchase, sale the Products as contemplated by this Agreement.


  


c.        If
as a result of an Event of Default the aggrieved party shall desire to terminate this Agreement, it shall
give written notice of its intent to terminate to the other party, and if that party fails to cure or correct such Event
of Default within thirty (30) days after giving such notice, then this Agreement shall terminate immediately
thereafter.  Termination or expiration of the term of this Agreement shall not affect the rights of either
party to receive payment or the performance of obligations accruing prior to such termination or expiration.


 


d.       Termination
without cause by the Brand Owner requires ninety (90) days written notice, payment in lieu of service.


  


e.       In
the event the Brand Owner makes the decision to cover the Territory and represent the Products through
a direct sales force, termination notice to The Agent requires ninety (90) days written notice, payment in lieu
of service.


  


f.         In
the event the Brand Owner sells the company, sells all or some of the product or sell the rights to all or some
of the products to a third party, which results in representation that is in conflict with the terms of this agreement, shall require
ninety (90) days written notice to terminate, payment in lieu of service.


 


 






    CANNAVOLVE
INC. 293 Laird Drive Toronto Ontario Canada M4G 3X6 - East 416.875.1294 - West 778.995.9310 WWW.CANNAVOLVE.CA


     


    

  


 


g.       Average
commission based on either agreed quantities in a supply agreement. As cannabis, cannabis derivatives and accessories become available
for sale in market, a commission rate for each product can be negotiated between The Agent and the Brand Owner to
a mutually agreeable outcome.






 


5.       OBLIGATIONS
OF AGENT – In addition to the other obligations of the The Agent as set forth in this Agreement,
The Agent agrees to the following:


 


a.       The
Agent will devote such time and resources as required to market and sell the Products in the Territory,
and shall, at its expense, use its best efforts to maintain an adequate sales force, and use all other possible means, to promote
the sale of the product in wholesale and retail channels throughout the Territory as provided for in the relevant
federal and provincial legislation governing the distribution of non-medical cannabis and non-medical cannabis related products.  The
Agent shall be responsible for all administrative activities associated with the representation of the Products in
the Territory accept whereby it is mandated by the provincial regulatory body to do otherwise.  


 


b.       The
Agent acknowledges and agrees that the Product and the brand names, goodwill, trademarks, formulas, label and packaging
designs, patents, copyrighted material and like property and rights in connection therewith (hereinafter called “Intellectual
Property”), are and shall remain the absolute property of Brand Owner, and The Agent shall immediately
inform Brand Owner of any infringements on the rights to its Intellectual Property that come to The Agent’s attention,
and if requested, The Agent will assist Brand Owner’s, at Brand Owner’s expense,
in taking all reasonable steps as required to defend the rights to its Intellectual Property.


 


c.        The
Agent will at its sole expense obtain such licenses and permits and do all other things that are legally required for
it to lawfully act as an Agent of the Product as provided in this Agreement.


 


d.       The
Agent shall comply with all applicable legislation in relation to the handling, storage (should there be such requirements),
distribution and sale of the Products in the Territory.  In addition, The Agent shall
not do anything which would adversely affect the reputation and goodwill of Brand Owner or adversely affect the
reputation of the Products. 


 


e.       The
Agent must receive approval in advance from the Brand Owner for marketing and promotional expenses required
to sell the Products in the Territory.  This includes and is not limited to business expenses
and promotional material.


 






    CANNAVOLVE
INC. 293 Laird Drive Toronto Ontario Canada M4G 3X6 - East 416.875.1294 - West 778.995.9310 WWW.CANNAVOLVE.CA


     


    

 


 


f.       The
Agent will give first right of refusal of new accessories brands not already contracted or in negotiations to the Brand
Owner as to avoid a product conflict in The Agent’s portfolio. 


 


6.           OBLIGATIONS
OF BRAND OWNER:  In addition to the other obligations of Brand Owner as set forth in this Agreement, Brand
Owner agrees as follows:


 





a.       Brand
Owner shall not sell the Products or relative trademark rights or similar products to any party other
than The Agent for sale and distribution within the Territory, or to any third party that Brand
Owner knows or has reason to know may resell the Products within the Territory.  Should Brand
Owner receive any inquiry regarding the sale of the Products in the Territory, Brand Owner shall
pass such inquiry on to The Agent.


 


b.       Throughout
the term of this Agreement, Brand Owner shall carry and keep in force a policy or policies of comprehensive and
general liability insurance providing coverage or not less than five million dollars ($5,000,000.00) and fifteen million dollars
($15,000,000.00) general recall insurance, and, upon request, shall provide The Agent with a Certificate of Insurance
reflecting such coverage. 


 


c.        Brand
Owner shall participate and fund marketing, promotional, and approved business expenses for the Products in
the Territory within the established guidelines of the prevailing federal and provincial legislation of the time.


 


7.           GRANT
OF RIGHTS TO TRADEMARK, ETC:  Brand Owner hereby grants to The Agent within
the Territory only a limited, exclusive license to use the trade names, trademarks and copyrighted materials relating
to the Products and owned by Brand Owner during the existence of this Agreement solely
in connection with the marketing, distribution and sale of the Products. The Agent acknowledges that
it has no ownership interest in the trademarks, trade names and copyrights so licensed, or in any other Intellectual Property
of Brand Owner, that such trademarks, trade names and copyrights are the sole property of Brand Owner,
and that upon the termination of this Agreement, The Agent shall no longer be entitled to use such
property and materials.  The Agent agrees that it will not adopt or utilize any trade names, trademarks
or copyrighted materials which are confusingly similar to those licensed to The Agent hereunder or otherwise
utilized by Brand Owner. 


 






    CANNAVOLVE
INC. 293 Laird Drive Toronto Ontario Canada M4G 3X6 - East 416.875.1294 - West 778.995.9310 WWW.CANNAVOLVE.CA


     


    

 


 


8.           ESTABLISHMENT
OF MARKETING AND PROMOTIONAL PLANS:  Representatives of The Agent and Brand Owner will
meet periodically each Contract Year, to review and establish marketing and promotional budgets, plans and concepts for the promotion
and sales of the Products in the Territory. Both parties are to agree in writing to said plans at
the least on an annual basis of either fiscal or calendar year. Any expenditure incurred by The Agent above the
agreed plans is to be funded by The Agent unless negotiated and confirmed in writing by both parties prior to
the expense being incurred. 


 


9.           CONFIDENTIALITY: 
During the existence of this Agreement and for a period of one (1) years after its termination, the parties shall
not disclose to any third party, or use for any purpose other than as required in the performance of this Agreement,
any information obtained by them in the performance of this Agreement, including but not limited to, prices, costs, sales
volumes, trademark information, product formulae, and any other information and trade secrets that might adversely affect either
party's ability to compete in any market.


 


10.         RELATION
OF PARTIES:  The relation of the parties hereto is that of contracting parties, and neither shall be or hold itself
out as being the partner, joint venturer, agent, servant or employee of the other party, or as having any authority to act in such
capacity for the other party.


 


11.         FORCE
MAJEURE:  If either party becomes unable to perform any of its obligations under this Agreement, other than the
obligation to pay money when due, because of any event which is unavoidable and beyond the control of the non-performing party
(“Event of Force Majeure”), including but not limited to, a judicial or governmental decree, regulation or other direction
not the fault of the party who has been so affected, inability to obtain materials or shipping space, labor stoppage, civil unrest,
loss of or damage to goods in transit, war, fire, power failure, earthquake, flood or other natural disaster or act of God, or
other circumstances of similar nature, the party that becomes aware of such event shall send the other party written notice thereof. 
The non-performing party shall take all steps required to resume performance as soon as possible; shall keep the other party informed
on a regular basis as to the status of the Event of Force Majeure, and shall not be considered a breach of any obligation hereunder
because of failure to perform during the period that it is prevented from performing by such Event of Force Majeure.  Notwithstanding
that an Event of Force Majeure shall not result in a breach of this Agreement, such event shall not excuse either party from its
failure to perform brought about by its lack of reasonable effort to correct such Event of Force Majeure and to carry out the terms
of this Agreement within a reasonable time.


 






    CANNAVOLVE
INC. 293 Laird Drive Toronto Ontario Canada M4G 3X6 - East 416.875.1294 - West 778.995.9310 WWW.CANNAVOLVE.CA


     


    

 


 


12.         NOTICES: 
All notices required by this Agreement shall be in writing, and if to The Brand Owner, they shall be addressed to the
attention of Rubin Schindermann, Saul Niddam, Adam Taub and if to The Agent, they shall be addressed
to the attention of either Trace Hanlon, Kye Melchert, Scott Oliver, sole Directors of Cannavolve Inc.  All notices shall
be sent by a recognized express mail service or governmental mail service addressed to the parties' respective addresses first
hereinabove written.  Such notices shall be deemed given when received by the addressee.


 


13.  INDEMNIFICATION
AND INSURANCE.  Each party shall indemnify and hold the other party harmless from and against any loss, liability
or damages, including the indemnified party’s legal fees and other costs of litigation, resulting from claims arising out
of either party’s non-performance of this Agreement, or out of the manufacture, packaging, storage, sale or use of the Product,
provided (i) that the loss is actually sustained by the aggrieved party seeking indemnification and is not covered by insurance,
and (ii) that a court of competent jurisdiction has by final unappealable judgment determined that the liability was attributable
to the willful malfeasance or nonfeasance or negligence of the party against which indemnity is sought.


 


14.  BINDING
EFFECT OF AGREEMENT AND ASSIGNABILITY:  This Agreement shall be binding upon and insure to the benefit of the
parties hereto and their respective successors and assigns; provided, however, The Agent shall not assign or subcontract
its rights and obligations hereunder to any third party without the prior written consent of Brand Owner, and in the
event of such assignment or subcontract with such written consent, The Agent’s liability for its obligations
to Brand Owner under the terms of this Agreement shall not be diminished.  The Agent shall
not otherwise delegate its rights and obligations under this Agreement to another importer/The Agent for the performance of The
Agent’s obligations to market and sell the Products in the Territory, or any part of
it, without Brand Owner’s prior written consent.  Whereas the Products are sold by Brand
Owner, this Agreement shall be binding upon the respective owner of the Product’s production, trademark and
licensing rights.


 


15.  ENTIRE
AGREEMENT:  This Agreement embodies the entire agreement between Brand
Owner and The Agent, and supersedes all prior oral and written negotiations, understandings and agreements, and
this Agreement shall not be amended, supplemented or modified except in writing signed by both parties hereto.


 






    CANNAVOLVE
INC. 293 Laird Drive Toronto Ontario Canada M4G 3X6 - East 416.875.1294 - West 778.995.9310 WWW.CANNAVOLVE.CA


     


    

 


 


16.  NON-WAIVER: 
No delay or failure by either party to exercise any right under this Agreement, and no partial or single exercise of
that right, shall constitute a waiver of that or any other right the party may have, and a waiver of any single incident shall
not be deemed to be a waiver of any other subsequent incident.


 


17.  HEADINGS: 
Headings to paragraphs in this Agreement are for convenience of reference, and shall not affect the meaning or
construction of this Agreement.


 


18.  COUNTERPARTS: 
This Agreement may be executed in counterparts, each of which when executed and delivered shall be deemed an original,
but all of which taken together shall constitute one and the same instrument.


 


19.  SEVERABILITY: 
If any provisions of this Agreement or part thereof is found by a court or other authority of competent jurisdiction
to be illegal, unenforceable, ineffective or void, then such provision, or part thereof, shall be severed and be of no further
effect.  If it is possible to accomplish the intent and business purposes of the parties pursuant to this Agreement without
giving effect to any void provisions thereof, the remainder of the Agreement shall be and remain in full force
and effect, and shall be construed to the fullest extent lawful to fulfill the intentions of the parties hereto as expressed by
the entire Agreement such severed portions.



20.   GOVERNING LAW  -  This Agreement shall be governed by and interpreted
in accordance with the laws of the province of Ontario.  Each party hereby irrevocably attorns to the jurisdiction of the
courts of Ontario in connection with any disputes that (i) may result from, arise out of, or relate to this Agreement, and (ii)
may be brought in such courts.  Each party hereby irrevocably waives (and irrevocably agrees not to raise) any objection that
it may now or hereafter have to the laying of the venue of any proceedings in any such courts and any claim that any such proceedings
have been brought in an inconvenient forum.  Judgment in any such proceedings in such court shall be conclusive and binding
upon the parties and may be enforced with courts of any other jurisdiction.


 


 



    CANNAVOLVE
INC. 293 Laird Drive Toronto Ontario Canada M4G 3X6 - East 416.875.1294 - West 778.995.9310 WWW.CANNAVOLVE.CA


     


    

 


 





IN TESTIMONY WHEREOF,
witness the signatures of the parties hereto, by their respective duly authorized officers or agents, effective as of the day and
year first hereinabove written.





 


 


 


 


CANNAVOLVE INC.


 


 


 


Signature: _________________________________


 


 


 


Name :  _________________________________


 


 


 


Title:  ________________________________


 


  


 


 


 


Target Group Inc.


 


 


 


Signature: _________________________________


 


 


 


Name:  _________________________________


 


 


 


Title:  ________________________________


 


 


 


           



    CANNAVOLVE
INC. 293 Laird Drive Toronto Ontario Canada M4G 3X6 - East 416.875.1294 - West 778.995.9310 WWW.CANNAVOLVE.CA


     


    

 


 





 


SCHEDULE A


 


              


 


Products


 


Includes all products
manufactured, all products represented, or all products offered for representation in the agreed territories by Target Group Inc.,
or related Companies, at present and future, during the term of the agreement and as listed below:


 


Canary/Serious Seeds
Products


 


		·	Cannabis Pre Roll



		·	Cannabis Seeds



		·	Cannabis Flower



 


CannaKorp Inc. /Wisp
Vaporizer


 


		·	Wisp Vaporizer (Complete Unit)



		·	Cannabis Wisp Pods



 


 



    CANNAVOLVE
INC. 293 Laird Drive Toronto Ontario Canada M4G 3X6 - East 416.875.1294 - West 778.995.9310 WWW.CANNAVOLVE.CA


     


    

 


 


 


SCHEDULE
B


 


 


 


Canary RX Cannabis
products including but not limited to Pre Roll, Seeds and Cannabis Flower – 6% of Net Sales.


 


Target Group and subsidiary
companies accessories and supplemental products will have commission rate negotiated by The Agent and the Brand Owner to a mutually
agreeable outcome.


 


 


 


Commission rate
based on wholesale price


 


As per our commission
schedule table based on Adult Non-Medicinal Non-medical cannabis product invoices to Control Boards and Licensed Retailers in the Territory.





 


 


 





		1.	Commissions due upon invoice, submission of completed
documents, and payment to the Brand Owner by the Provincial Boards. Net 30 days of payment received by Brand Owner from
the Board.



 


		2.	No deductions may be made by the Brand Owner when
or after Provincial Boards make deductions from payments to Brand Owner.  The items may be for, but not limited to, damages,
returns, out-dated stock, etc.



 


		3.	Should a separate supply agreement be entered into between
the parties and duly signed as such, the dollar value agreed to in said supply agreement will determine the annual commission
rate.



 


		4.	Should the Brand Owner default on the supply agreement
The Agent retains the right to reconcile annually based on actual supply of product and invoice the commission charged
as per schedule B rates.



 


		5.	Should The Agent fail to sell the dollar value
considered under said supply agreement annually The Agent retains no right to alter the agreed commission rate contemplated
in the supply agreement.








  


 


 






    CANNAVOLVE INC. 293 Laird Drive Toronto Ontario Canada M4G 3X6 - East 416.875.1294 - West 778.995.9310 WWW.CANNAVOLVE.CA