Exhibit 4.12


 


EMPLOYMENT
AGREEMENT


 


This
EMPLOYMENT AGREEMENT (this “Agreement”) is entered into as of this 31st day of March, 2021, by and between
R. Michael Smullen, an individual resident of the State of Florida (“Executive”), and Verano Holdings Corp., a British
Columbia corporation (the “Company”).


 


A.
The Company wishes to employ Executive to provide services to the Company and its subsidiaries in accordance with the terms of this Agreement.


 


B.
Executive wishes to accept employment with the Company and provide such services to the Company and its subsidiaries according to the
terms of this Agreement.


 


C.
This Agreement shall replace and supersede in its entirety any prior employment agreements, arrangements or understandings between Executive,
on the one hand, and the Company or any of its subsidiaries, on the other hand (individually and collectively, the “Prior Agreement”).


 


NOW,
THEREFORE, in consideration of the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto, intending to be legally bound, agree as follows:


 


1.
Effectiveness and Employment.


 


(a)
The obligations of the Company in this Agreement shall become effective on the consummation (the “Effective Date”)
of that Agreement and Plan of Merger, dated as of November 6, 2020, by and among Verano Holdings, LLC, Alternative Medical Enterprises,
LLC, Plants of Ruskin GPS, LLC and RVC 360, LLC, which transactions include, among other things, such parties becoming subsidiaries of
the Company pursuant to a business combination to be effected under an arrangement governed by the laws of British Columbia (the “Combination”).


 


(b)
The Company hereby agrees to employ Executive, and Executive hereby accepts employment by the Company, upon the terms and conditions
set forth in this Agreement for the period beginning on the Effective Date and ending on the date described in Section 4(a) (the
“Employment Period”).


 


2.
Position and Duties.


 


(a)
During the Employment Period, Executive shall serve as Executive Director of MÜV Enterprises, and in connection therewith Executive
shall render such administrative, financial and other executive and managerial services to the Company and its subsidiaries and have
the responsibilities and authority which are consistent with Executive’s position, subject to the power and authority of the Board
of Directors of the Company (the “Board”) to expand or limit such duties, responsibilities, functions and authority.


 


(b)
Executive shall report to the Company’s Chief Executive Officer (or such other person as shall be designated by the Board). Executive
shall perform Executive’s duties and responsibilities to the best of Executive’s abilities in a diligent, trustworthy, businesslike
and efficient manner. Executive shall devote Executive’s full business time, energies and attention during customary business hours
(except for permitted vacation periods and periods of illness or other temporary incapacity) to the business and affairs of the Company
and its subsidiaries. So long as Executive is employed by the Company, Executive shall not, without the prior written consent of the
Board, accept other employment or perform other services for compensation or that interfere with Executive’s employment with the
Company; provided, however, that Executive may serve as an officer or director of or otherwise participate in purely educational,
welfare, social, religious and civic organizations, in each of the foregoing cases so long as such activities are not in competition
with the Company or any of its subsidiaries and do not interfere with Executive’s ability to carry out Executive’s duties
under this Agreement.


 




    	 



     


    

 


(c)
Executive shall comply with all lawful rules, policies, procedures, regulations and administrative directions now or hereafter reasonably
established by the Board for officers or employees of the Company or any of its subsidiaries.


 


3.
Salary and Benefits. Subject to Section 4:


 


(a)
Salary. During the Employment Period, the Company shall pay Executive a base salary at the annual rate of US$100,000, payable in
regular installments in accordance with the Company’s usual payment practices subject to required withholdings and taxes.


 


(b)
Performance Bonus. Executive will be eligible to earn four separate performance bonuses, each paid in a combination of cash and Class
B Proportionate Voting Shares of stock of the Company, based upon the gross sales for the Company’s Florida and Arizona operations
acquired in the Combination exceeding specified levels for each of (i) the first fiscal quarter of 2021, (ii) the year to date through
the third fiscal quarter of 2021, (iii) the first fiscal quarter of 2022, and (iv) the year to date through the third fiscal quarter
of 2022, in each case as set forth and described on Schedule 3(b) (the “Performance Bonuses”). The right to
be paid Performance Bonuses if earned is in lieu of, and not in addition to, any bonus, incentive or equity plan or any other similar
plan or program of the Company.


 


(c)
Signing Bonus. Executive shall be entitled to a signing bonus in the amount of US$1,000,000 (the “Signing Bonus”).
The Signing Bonus shall be earned and payable by Company check or immediately available funds on April 1, 2021.


 


(d)
Benefits. During the Employment Period, Executive shall be entitled to paid vacation, paid holidays and to participate in all health
insurance plans, retirement plans (including 401(k)), life insurance plans and (except for any equity, incentive or bonus plans or programs)
all other perquisite plans and programs for which employees of Executive’s rank in the Company are generally eligible (collectively,
the “Benefit Plans”), in each case consistent with the Company’s then-current practice as approved by the Board
from time to time. The foregoing shall not be construed to require the Company to establish such Benefit Plans or to prevent the modification
or termination of such Benefit Plans once established, and no such action or failure thereof shall affect this Agreement. Executive recognizes
that the Company and its affiliates have the right, in their sole discretion, to amend, modify or terminate any Benefit Plans without
creating any rights in Executive.


 


(e)
Business Expenses. During the Employment Period, the Company shall reimburse Executive for all reasonable business expenses incurred
by Executive in the course of performing Executive’s duties under this Agreement; provided such expenses are consistent
with the Company’s policies in effect from time to time with respect to travel, entertainment and other business expenses. As a
condition to being issued such reimbursements, Executive shall submit to the Company on a timely basis business expense reports, including
substantiation in accordance with the Company’s policy as in effect from time to time. For purposes of compliance with Code Section
409A (as defined in Section 23): (i) all expenses or other reimbursements under this Agreement shall be made on or prior to the
last day of the taxable year following the taxable year in which such expenses were incurred by Executive, (ii) any such right to reimbursement
or in kind benefits is not subject to liquidation or exchange for another benefit, and (iii) no such reimbursement, expenses eligible
for reimbursement or in-kind benefits provided in any taxable year shall in any way affect the expenses eligible for reimbursement, or
in-kind benefits to be provided, in any other taxable year.


 




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4.
Employment Period.


 


(a)
The Employment Period shall begin on the Effective Date and shall continue for two years, and shall thereafter automatically renew for
one year terms unless either party gives the other party no less than 30 days’ notice of its election not to renew, or until Executive’s
employment hereunder is terminated in accordance with Section 4(b).


 


(b)
The Employment Period and Executive’s employment hereunder (i) shall terminate upon Executive’s death or permanent disability
or incapacity, (ii) may be terminated by the Company at any time with or without Cause (as defined in Section 4(f)), and (iii)
may be terminated by Executive at any time.


 


(c)
If Executive’s employment hereunder is terminated by the Company for Cause or by Executive during the Employment Period, then Executive
shall be entitled to receive only Executive’s accrued, unpaid Salary, and for the year during which Executive’s employment
hereunder is terminated, accrued but unused vacation time through the effective date of Executive’s termination of employment (the
“Termination Date”), any reimbursements owed for business expenses validly incurred on or prior to the Termination
Date and reimbursable in accordance with Section 3(e) and any accrued but unpaid benefits due and owing to Executive under the
Benefit Plans (collectively, the “Accrued Obligations”), and shall not be entitled to any other compensation or benefits.


 


(d)
If Executive’s employment hereunder is terminated without Cause by the Company during the Employment Period, then Executive shall
be entitled to receive the Accrued Obligations and, provided Executive signs and does not revoke a general release of claims against
the Company and its affiliates on a form to be provided by the Company within 14 days of the Termination Date, does not apply for unemployment
compensation chargeable to the Company or any of its subsidiaries during the 12 months following the Termination Date, and subject to
Executive’s compliance with each obligation pursuant to Section 5, Section 6 and Section 7, Executive shall also
be entitled to receive any Performance Bonuses that are earned after the Termination Date and if unpaid as of the Termination Date.


 


(e)
If Executive’s employment hereunder is terminated as a result of Executive’s death, permanent disability or incapacity during
the Employment Period, Executive or Executive’s representatives or beneficiaries shall be entitled to receive only the Accrued
Obligations and any rights to continuation of coverage and to benefits under any Benefit Plans required under applicable law and subject
to Executive’s compliance to the extent possible with each obligation pursuant to Section 5, Section 6 and Section 7,
Executive (or his estate, as applicable) shall also be entitled to receive any Performance Bonuses that are earned after the Termination
Date and if unpaid as of the Termination Date.


 




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(f)
For purposes of the Agreement, “Cause” shall mean any of Executive’s (i) willful failure to comply with any
valid and legal directive of the Chief Executive Officer of the Company or the Board, (ii) willful engagement in dishonesty, illegal
conduct, or gross misconduct, which is, in each case, injurious to the Company or any of its affiliates; (iii) embezzlement, misappropriation,
or intentional fraud, whether or not related to Executive’s employment with the Company; (iv) conviction of or plea of guilty or
nolo contendere to a crime that constitutes a felony (or state law equivalent); (v) commission or conviction of a crime which would disqualify
Executive for registration or licensure by the applicable regulatory or licensing authority governing the Company’s, or any subsidiary
or affiliate of the Company’s, participation in a State-regulated cannabis program; (vi) material breach of any material obligation
under this Agreement or any other written agreement between Executive and the Company or any of its subsidiaries; or (vii) any material
failure by Executive to comply with the Company’s written policies or rules, as they may be in effect from time to time, if such
failure causes reputational or financial harm to the Company or any of its affiliates.


 


(g)
For purposes of this Agreement, Executive’s permanent disability or incapacity shall be determined in accordance with the Company’s
long-term disability insurance policy, if such a policy is then in effect, or, if no such policy is then in effect, then such permanent
disability or incapacity shall be deemed to have occurred upon Executive’s inability to perform the essential functions of the
position set forth in Section 2(a), after reasonable accommodation by the Company, for a period of at least 180 days, in the aggregate,
during any period of 365 calendar days, unless further time is required as a reasonable accommodation under the Americans with Disabilities
Act.


 


5.
Restrictive Covenants. In consideration of this Agreement and Executive’s substantial direct and indirect benefits arising
from the Combination, Executive, knowingly and intending to be legally bound, agrees as follows.


 


(a)
Noncompetition Covenant. During the period commencing on the Effective Date and terminating on the third anniversary of the Termination
Date (the “Restricted Period”), Executive shall not directly or indirectly (whether for compensation or without compensation),
as principal, agent, owner, partner, employee, consultant, shareholder, member, director, manager or officer, as the case may be, or
otherwise howsoever, own, operate, be engaged in or connected with the operation of or have any financial interest in or advance, lend
money to, guarantee the debts or obligations of or permit Executive’s name or part thereof to be used or employed in any operation,
whether a proprietorship, partnership, joint venture, company or other entity, legal or otherwise, whatsoever, or otherwise carry on
or engage in any activity or business similar to the Company’s business or be connected or involved in any manner whatsoever in
any activity or business similar to the Company’s business in whole or in part; provided, however, that such restrictions
shall not preclude Executive from owning stock in the Company or up to 1% of the total outstanding stock of any other publicly traded
entity.


 


(b)
Non-solicitation Covenant. During the Restricted Period, Executive shall not, directly or indirectly (whether for compensation or
without compensation), as principal, agent, owner, partner, employee, consultant, shareholder, member, director, manager or officer,
as the case may be (other than as the holder of stock in the Company or a holder of an ownership interest of not more than 1% of the
total outstanding stock of any other publicly traded entity):


 




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(i)
interfere with, disrupt or obtain business from, accept business from or contact any current or former party engaging in business with
the Company or any of its subsidiaries (or attempt to do any of the foregoing), in each case with respect to any activity or business
engaged in by the Company or any of its subsidiaries with such party, whether in whole or in part; or


 


(ii)
induce or attempt to induce any employee of the Company or any of its subsidiaries to terminate employment with the Company or such subsidiary,
hire or participate in the hiring of any employee or independent contractor of the Company or any of its subsidiaries, or interfere with
or attempt to disrupt the relationship, contractual or otherwise, between the Company or any of its subsidiaries and any of their respective
employees or independent contractors. For purposes of this paragraph, an employee or independent contractor means any person employed
or contracted by the Company or any of its subsidiaries during the Employment Period.


 


6.
Confidentiality. In consideration of this Agreement, Executive’s substantial direct and indirect benefits arising from
the Combination, and Executive’s access to Confidential Information (as defined below), Executive, knowingly and intending to be
legally bound, agrees as follows.


 


(a)
Executive will not at any time (whether during or after Executive’s employment with the Company) (i) retain or use for the benefit,
purposes or account of Executive or any other person; or (ii) disclose, divulge, reveal, communicate, share, transfer or provide access
to any person outside the Company (other than its professional advisers who are bound by confidentiality obligations), any non-public,
proprietary or confidential information, including without limitation, trade secrets, know-how, research and development, software, databases,
inventions, processes, formulae, technology, designs and other intellectual property, information concerning finances, investments, profits,
pricing, costs, products, services, vendors, customers, clients, partners, investors, personnel, compensation, recruiting, training,
advertising, sales, marketing, promotions, government and regulatory activities and approvals, in each case concerning the past, current
or future business, activities and operations of the Company, its subsidiaries or affiliates or any third party that has disclosed or
provided any of such information to the Company or any of its subsidiaries on a confidential basis (collectively, “Confidential
Information”) without the prior written authorization of the Board; provided, that Executive may disclose such information
to Executive’s legal and financial advisors for the limited purpose of enforcing Executive’s rights under this Agreement
so long as Executive requires that such legal and financial advisors not disclose such information, and Executive shall be liable for
any disclosure by such legal or financial advisors.


 


(b)
Confidential Information shall not include any information that is: (i) generally known to the industry or the public other than as a
result of Executive’s breach of this Agreement or any breach of other confidentiality obligations by third parties; (ii) made legitimately
available to Executive by a third party without breach of any confidentiality obligation; or (iii) required by applicable law to be disclosed;
provided that Executive shall give prompt written notice to the Company of such requirement, disclose no more information than
is so required, and cooperate with any attempts by the Company to obtain a protective order or similar treatment.


 




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(c)
Executive acknowledges, agrees, and understands that (i) nothing in this Agreement prohibits Executive from reporting to any governmental
authority or attorney information concerning suspected violations of law or regulation, provided that Executive does so consistent with
18 U.S.C. 1833, and (ii) Executive may disclose trade secret information to a government official or to an attorney and use it in certain
court proceedings without fear of prosecution or liability, provided that Executive does so consistent with 18 U.S.C. 1833.


 


(d)
Except to the extent disclosed by the Company as may be required by applicable securities and other laws or applicable stock exchange
listing standards, Executive will not disclose to anyone, other than Executive’s spouse, legal or financial advisors or members
of the Company’s senior management, the existence or contents of this Agreement.


 


(e)
Upon termination of Executive’s employment with the Company for any reason, Executive shall: (i) cease and not thereafter commence
use of any Confidential Information or intellectual property (including, without limitation, any patent, invention, copyright, trade
secret, trademark, trade name, logo, domain name or other source indicator) owned or used by the Company, its subsidiaries or affiliates;
(ii) immediately return to the Company, at the Company’s option, all originals and copies in any form or medium (including memoranda,
books, papers, plans, computer files, letters and other data) in Executive’s possession or control (including any of the foregoing
stored or located in Executive’s office, home, laptop or other computer, whether or not Company property) that contain Confidential
Information or otherwise relate to the business of the Company, its affiliates and subsidiaries, except that Executive may retain only
those portions of any personal notes, notebooks and diaries that do not contain any Confidential Information or are not related to the
Company’s business; and (iii) notify and fully cooperate with the Company regarding the delivery of any other Confidential Information
of which Executive is or becomes aware.


 


7.
Intellectual Property. In consideration of this Agreement and Executive’s substantial direct and indirect benefits arising
from the Combination, Executive, knowingly and intending to be legally bound, agrees as follows.


 


(a)
If Executive has created, invented, designed, developed, contributed to or improved any works of authorship, inventions, intellectual
property, materials, documents or other work product (including, without limitation, research, reports, software, databases, systems,
applications, presentations, textual works, content or audiovisual materials) (“Works”), either alone or with third
parties, prior to Executive’s employment by the Company, that are relevant to or implicated by such employment (“Prior
Works”), Executive hereby grants the Company and its subsidiaries a perpetual, non-exclusive, royalty-free, worldwide, assignable,
sub-licensable license under all rights and intellectual property rights (including rights under patent, industrial property, copyright,
trademark, trade secret, unfair competition and related laws) therein for all purposes in connection with the Company’s or any
of its subsidiaries’ current and future business. Executive shall provide the Company with a written list of all Prior Works within
15 days after the Effective Date.


 




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(b)
If Executive creates, invents, designs, develops, contributes to or improves any Works, either alone or with third parties, at any time
during Executive’s employment by the Company and within the scope of such employment or with the use of any resources of the Company
or any of its subsidiaries (“Company Works”), Executive shall promptly and fully disclose the Company Works to the
Company and hereby irrevocably assigns, transfers and conveys, to the maximum extent permitted by applicable law, all rights and intellectual
property rights therein (including rights under patent, industrial property, copyright, trademark, trade secret, unfair competition and
related laws) to the Company to the extent ownership of any such rights does not vest originally in the Company.


 


(c)
Executive shall keep and maintain adequate and current written records (in the form of notes, sketches, drawings and any other form or
media requested by the Company) of all Company Works. The records will be available to and remain the sole property and intellectual
property of the Company at all times.


 


(d)
Executive shall take all requested actions and execute all requested documents (including any licenses or assignments required by a government
contract) at the Company’s expense (but without further remuneration) to assist the Company in validating, maintaining, protecting,
enforcing, perfecting, recording, patenting or registering any of the Company’s rights in the Prior Works and Company Works. If
the Company is unable for any other reason to secure Executive’s signature on any document for this purpose, then Executive hereby
irrevocably designates and appoints the Company and its duly authorized officers and agents as Executive’s agent and attorney in
fact, to act for and in Executive’s behalf and stead to execute any documents and to do all other lawfully permitted acts in connection
with the foregoing.


 


(e)
Executive shall not improperly use for the benefit of, bring to any premises of, divulge, disclose, communicate, reveal, transfer or
provide access to, or share with the Company or any of its subsidiaries any confidential, proprietary or non-public information or intellectual
property relating to a former employer or other third party (in each case that is not then a subsidiary of the Company) without prior
written permission of such third party. Executive shall comply with all relevant policies and guidelines of the Company regarding the
protection of confidential information and intellectual property and potential conflicts of interest. Executive acknowledges that the
Company may amend any such policies and guidelines from time to time, and that Executive remains at all times bound by their most current
version that has been communicated to Executive.


 


8.
Return of Company Property. At the termination of the Employment Period and at any other time upon the request of the Company,
Executive shall deliver to the Company any and all of the Company’s documents, plans, records, computer tapes, software, drawings,
notes, memoranda, specifications, devices (including, without limitation, any cellular phone or computer), and formulas relating to the
Company’s business, together with all copies thereof, which is in the possession of Executive.


 


9.
Enforcement. If, at the time of enforcement of Section 5, Section 6 or Section 7, a court holds that the restrictions
stated herein are unreasonable under circumstances then existing, the parties hereto agree that the maximum period, scope or geographical
area reasonable under such circumstances shall be substituted for the stated period, scope or area. It is specifically understood and
agreed that any breach of the provisions of Section 5, Section 6 or Section 7 are likely to result in irreparable injury
to the Company and the parties hereto agree that money damages would be an inadequate remedy for any breach of Section 5, Section
6 or Section 7. Therefore, in the event of a breach or threatened breach of Section 5, Section 6 or Section 7,
the Company or its successors or assigns shall, in addition to other rights and remedies existing in their favor, be entitled to specific
performance and/or injunctive or other relief in order to enforce, or prevent any violations of, Section 5, Section 6 or Section
7.


 




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10.
Representations and Warranties.


 


(a)
Executive hereby represents and warrants to the Company that (i) the execution, delivery and performance of this Agreement by Executive
does not and will not conflict with, breach, violate or cause a default under any contract, agreement, instrument, order, judgment or
decree to which Executive is a party or by which Executive is bound, (ii) Executive is not a party to or bound by any employment agreement,
non-solicitation agreement, assignment of inventions or confidentiality agreement with any other person or entity, (iii) Executive is
not subject to any noncompetition agreement or any other agreement or restriction of any kind that would impede in any way the ability
of Executive to carry out fully all activities of Executive in furtherance of the business of the Company or any of its subsidiaries,
(iv) Executive is not in violation of a confidentiality, non-solicitation or non-competition agreement or any other agreement relating
to the relationship of Executive with any third party, because of the nature of the business conducted by the Company or any of its subsidiaries,
and (v) upon execution and delivery of this Agreement, this Agreement shall be the valid and binding obligation of Executive, enforceable
against Executive in accordance with its terms, and shall replace and supersede in its entirety any Prior Agreement.


 


(b)
The Company hereby represents and warrants to Executive that (i) the execution, delivery and performance of this Agreement by the Company
does not and will not conflict with, breach, violate or cause a default under any contract, agreement, instrument, order, judgment or
decree to which the Company is a party or by which the Company is bound and (ii) upon execution and delivery, this Agreement shall be
the valid and binding obligation of the Company, enforceable against the Company in accordance with its terms.


 


11.
Successors and Assigns. This Agreement shall bind and inure to the benefit of and be enforceable by Executive and the Company
and their respective heirs, successors and permitted assigns. Neither party may assign any of its rights or assign or delegate any of
its obligations hereunder without the prior written consent of the other party hereto; provided, however, that (a) the
Company shall be permitted to assign this Agreement to any of its subsidiaries or to any successor to all or substantially all of its
business or assets that agrees in writing to assume all of the Company’s obligations hereunder, and (b) the Company’s subsidiaries
and affiliates are third party beneficiaries of this Agreement. Any change of control, merger, business combination or similar transaction
of the Company after the Effective Date shall not be deemed to result in an assignment or delegation of this Agreement by the Company.


 


12.
Notices. All notices, demands or other communications to be given or delivered under or by reason of the provisions of this
Agreement shall be in writing and shall be deemed to have been given (a) on the date having been delivered personally, (b) on the date
delivered by a private courier as established by evidence obtained from such courier, (c) on the date sent by facsimile or e-mail transmission
(with acknowledgement of both complete transmission and receipt), or (d) on the fifth day after the date mailed, by certified or registered
mail, return receipt requested, postage prepaid. Notices, demands or communications to any party hereto will, unless another address
is specified in writing pursuant to this Section 12, be sent to the addresses indicated below.


 


	If
    to Executive:	If
    to the Company:
	 	 
	Mike
    Smullen	Verano
    Holdings Corp.
	16427
    Daysailor Trail 	415
    N. Dearborn Street, Suite 400
	Bradenton,
    FL 34202	Chicago,
    IL 60654
	Email:
    mike@altmed.co	Attn:
    George Archos, Chief Executive Officer
	 	Email:
    george@verano.holdings


 




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13.
Severability. Whenever possible, each provision of this Agreement will be interpreted in such manner as to be valid under applicable
law; but, if any provision of this Agreement is held to be invalid, illegal or unenforceable in any respect under any applicable law
or rule in any jurisdiction, such invalidity, illegality or unenforceability will not affect any other provision or any other jurisdiction,
but except as otherwise set forth in this Agreement, this Agreement will be reformed, construed and enforced in such jurisdiction as
if such invalid, illegal or unenforceable provision had never been contained herein.


 


14.
Complete Agreement. This Agreement embodies the complete agreement and understanding between the parties hereto with respect
to the subject matter hereof and supersedes and preempts any prior understandings, agreements or representations by or among the parties
hereto, written or oral, which may have related to the subject matter hereof in any way, including without limitation, any Prior Agreement.


 


15.
Signatures; Counterparts. This Agreement may be executed in one or more counterparts, each of which will be deemed an original
but all of which together will constitute one and the same instrument. For purposes hereof, a facsimile signature, portable document
format (.pdf) signature or signature sent by electronic transmission will be considered an original signature.


 


16.
Governing Law. All issues and questions concerning the construction, validity, enforcement and interpretation of this Agreement
shall be governed by, and construed in accordance with, the internal laws of the State of Illinois, without giving effect to any choice
of law or conflict of law rules or provisions (whether of the State of Illinois or any other jurisdiction).


 


17.
Survival. From and after the Effective Date, the provisions of Section 4, Section 5, Section 6, Section 7, Section 8, Section
9, Section 11, Section 12, Section 13, Section 14, Section 16, this Section 17, Section 19, Section 20, Section 21, Section 23,
Section 24, and Section 26 shall survive the termination of Executive’s employment and the termination of this Agreement
for any reason.


 


18.
Tax Withholdings. The Company shall deduct or withhold from any amounts owing from the Company to Executive any federal, state,
local or foreign withholding taxes, excise tax, or employment taxes imposed with respect to Executive’s compensation or other payments
from the Company or Executive’s ownership interest in the Company, if any (including, without limitation, wages, bonuses, dividends,
the receipt or exercise of equity options and/or the receipt or vesting of restricted equity).


 




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19.
Dispute Resolution. Any controversy, dispute or claim arising out of or relating to any interpretation, performance, construction,
termination or breach of this Agreement shall first be settled through good faith negotiation between the parties hereto. If the controversy,
dispute or claim cannot be settled through negotiation, such matter must only be settled by final and binding arbitration by a single
arbitrator held in Chicago, Illinois, except as otherwise provided herein. Such mandatory arbitration may be brought by either party
hereto and shall be administered by JAMS pursuant to its Employment Arbitration Rules & Procedures and subject to JAMS Policy on
Employment Arbitration Minimum Standards of Procedural Fairness. Judgment on the arbitration award may be entered in any court having
proper jurisdiction. In aid of arbitration, either party hereto may seek preliminary or temporary injunctive relief at any time before
the arbitration demand has been filed and served or before an arbitrator has been selected. This agreement to mandatory arbitration is
a specifically bargained for inducement for each of the parties hereto to enter into this Agreement (after having the opportunity to
consult with counsel).


 


20.
Headings; No Strict Construction. The headings of the paragraphs and sections of this Agreement are inserted for convenience
only and shall not be deemed a part of or affect the construction or interpretation of any provision hereof. The language used in this
Agreement shall be deemed to be the language chosen by the parties hereto to express their mutual intent, and no rule of strict construction
shall be applied against any party.


 


21.
Executive’s Cooperation. During the Employment Period and thereafter, Executive shall, subject to the Company reimbursing
Executive for out-of-pocket expenses, cooperate with the Company in any internal investigation or administrative, regulatory or judicial
proceeding as reasonably requested by the Company (including, without limitation, Executive being available to the Company upon reasonable
notice for interviews and factual investigations, appearing at the Company’s request to give testimony without requiring service
of a subpoena or other legal process, volunteering to the Company all pertinent information and turning over to the Company all relevant
documents which are or may come into Executive’s possession, all at times and on schedules that are reasonably consistent with
Executive’s other permitted activities and commitments).


 


22.
Corporate Opportunity. During the Employment Period, Executive shall submit to the Board all business, commercial and investment
opportunities or offers presented to Executive or of which Executive becomes aware which relate to the business of the Company or any
of its subsidiaries at any time during the Employment Period (“Corporate Opportunities”). Unless previously approved
in writing by the Board, Executive shall not accept or pursue, directly or indirectly, any Corporate Opportunities on Executive’s
own behalf.


 


23.
Section 409A Compliance. The intent of the parties is that payments and benefits under this Agreement comply with Section 409A
of the Internal Revenue Code of 1986, as amended, and the regulations and guidance promulgated thereunder (collectively, “Code
Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in compliance therewith.
To the extent that any provision hereof is modified in order to comply with Code Section 409A, such modification shall be made in good
faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit to Executive and the Company
of the applicable provision without violating the provisions of Code Section 409A. In no event whatsoever shall the Company be liable
for any additional tax, interest or penalty that may be imposed on Executive by Code Section 409A or damages for failing to comply with
Code Section 409A. Notwithstanding anything herein to the contrary, a termination of employment shall be deemed to have occurred at the
time such termination constitutes a “separation from service” within the meaning of Code Section 409A for purposes of any
provision of this Agreement providing for the payment of any amounts or benefits in connection with a termination of employment and,
for purposes of any such provision of this Agreement, references to a “termination,” “termination of employment”
or like terms shall mean a “separation from service.” Notwithstanding any other provision to the contrary, in no event shall
any payment under this Agreement that constitutes “deferred compensation” for purposes of Code Section 409A be subject to
offset by any other amount unless otherwise permitted by Code Section 409A.


 




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24.
Amendment and Waiver. The provisions of this Agreement may be amended or waived only with the prior written consent of the Company
and Executive, and no course of conduct or failure or delay in enforcing the provisions of this Agreement shall affect the validity,
binding effect or enforceability of this Agreement.


 


25.
Key Person Insurance. The Company and its affiliates shall have the right, but not the obligation, to obtain or increase insurance
on Executive’s life in such amount as the Board or such affiliate determines, in the name of the Company or such affiliates, as
the case may be, and for its sole benefit or otherwise. Upon reasonable advance notice, Executive will cooperate in any and all necessary
physical examinations without expense to Executive, supply information and sign documents and otherwise cooperate fully with each of
the Company and its affiliates as the Company and its affiliates may request.


 


26.
Read and Understood. Executive has read this Agreement carefully and understands each of its terms and conditions. Executive
has sought independent legal counsel of Executive’s choice to the extent Executive deemed such advice necessary in connection with
the review and execution of this Agreement.


 




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IN
WITNESS WHEREOF, the parties hereto have executed this Agreement to be effective as of the Effective Date.


 


	 	THE
    COMPANY: 
	 	 
	 	Verano
    Holdings Corp.
	 	 	 
	 	By:	/s/
                                            “George Archos”

	 	 	George
    Archos, CEO
	 	 	 
	 	EXECUTIVE:
	 	 	 
	 	/s/ “R. Michael Smullen”
	 	R. Michael Smullen


 




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Schedule
3(b) 


 


Performance
Bonus


 


1.
Defined Terms. As used herein, capitalized terms have the meanings set forth below or in the Employment Agreement to which
this Schedule 3(b) is attached (the “Employment Agreement”), as applicable.


 


“Additional
Payment” means an aggregate amount of US$13,500,000.


 


“Applicable
Period” means each of the following four separate and distinct fiscal periods of time for the Company as determined from the
Company Financial Statements: (i) the first fiscal quarter of 2021; (ii) the year-to-date from the first day of fiscal year 2021 through
the last day of the third fiscal quarter of 2021; (iii) the first fiscal quarter of 2022; (iv) the year-to-date from the first day of
fiscal year 2022 through the last day of the third fiscal quarter of 2022.


 


“Cash
and Share Percentages” means (a) 61.111% of the total amount of a Performance Bonus will be comprised of cash paid in United
States Dollars by Company check or wire transfer of funds, and (b) 38.889% of the total amount of a Performance Bonus will be comprised
of Consideration Shares issued to Executive and valued at the Share Price multiplied by 100.


 


“Company
Financial Statements” means the unaudited consolidating financial statements of the Company and its subsidiaries for an applicable
period prepared in the ordinary course of business in accordance with International Reporting Standards issued by the International Accounting
Board Standards, except that such financial statements shall not contain footnotes or year-end adjustments.


 


“Company
Shares” means Class A Subordinate Voting Shares of the Company. 


 


“Consideration
Shares” means Class B Proportionate Voting Shares of the Company.


 


“Gross
Sales” means, for the applicable period of determination, an aggregate amount equal to the consolidated sales of the Company
arising solely from the Company’s operations consisting of (a) Alternative Medical Enterprises, LLC, (b) Plants of Ruskin GPS,
LLC, and (c) RVC 360, LLC, that were in effect as of the Effective Date and acquired by the Company in the Combination. For the avoidance
of doubt, Gross Sales shall not include any operations acquired by the Company or any of its subsidiaries after the Effective Date, but
shall include organic growth and expansion of such operations. Such Gross Sales shall be in United States Dollars and determined from
the Company Financial Statements for the Applicable Period of determination and shall be reduced by any discounts, returns and sales
allowances.


 


“Share
Price” means for each Company Share, the volume weighted average price (VWAP) trading benchmark for the trading day that is
the third business day prior to (and not including) the date of payment of the applicable Performance. The Share Price shall be calculated
and applied in United States Dollars.


 




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“US$
or United States Dollars” means the currency of the United States of America denominated in dollars.


 


2.
Performance Bonuses.


 


(a)
For each Applicable Period, if Executive is eligible to earn a Performance Bonus at such time in accordance with the Employment Agreement,
Executive shall be paid a Performance Bonus in United States Dollars equal to 25% of the Additional Payment if, and only if, Gross Sales
for such Applicable Period exceed the following applicable amount:


 


	Applicable
    Period	 	Gross
    Sales Must Exceed
	 	 	 
	the
    first fiscal quarter of 2021	 	US$35,000,000
	 	 	 
	the
    year-to-date from the first day of fiscal year 2021 through the last day of the third fiscal quarter of 2021	 	US$120,000,000
	 	 	 
	the
    first fiscal quarter of 2022	 	US$40,000,000
	 	 	 
	the
    year-to-date from the first day of fiscal year 2022 through the last day of the third fiscal quarter of 2022	 	US$120,000,000


 


In
no event shall any Gross Sales be carried forward or carried back to any other Applicable Period. If earned, a Performance Bonus shall
only be equal to 25% of the Additional Payment and shall not be based on a sliding scale or any proration. Only one Performance Bonus
can be earned for an Applicable Period and if not earned for such Applicable Period, such Performance Bonus shall be forfeited and null
and void. In no event shall more than four Performance Bonuses be earned and the aggregate amount of Performance Bonuses shall not exceed
the Additional Payment. It is the intent of the parties hereto that the Performance Bonuses are based solely on the aggregate Gross Sales
of the operations of Alternative Medical Enterprises, LLC, Plants of Ruskin GPS, LLC, and RVC 360, LLC that were acquired by the Company
in the Combination on the Effective Date and shall not include any operations acquired thereafter.


 


(b)
Achievement of a Performance Bonus shall be determined within ten business days of the final issuance of the applicable Company Financial
Statements, and paid within ten business days of determination that such Performance Bonus is earned and payable to Executive. Each Performance
Bonus shall be paid to Executive in accordance with the Cash and Share Percentages. Any Company Shares issued to Executive as part of
a Performance Bonus shall be subject to any lock-up agreement or similar trading restriction applicable to Executive with respect to
Company Shares.


 


(c)
As may be applicable, Canadian dollars shall be converted into U.S. dollars using the applicable exchange rate at the date of determination
as published by the Bank of Canada.


 




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