Exhibit 4.7


 


LOCK-UP AGREEMENT


 


This Lock-Up Agreement (this
 “Agreement”) is made and entered into as of June 29, 2021 by and among Glass House Brands Inc., a British
Columbia corporation f/k/a Mercer Park Brand Acquisition Corp. (the “Company”) and the parties listed on Schedule
A hereto (each such party, together with any person or entity who hereafter becomes a party to this Agreement pursuant to Section 2.2
or Section 3.2 of this Agreement, a “Holder” and collectively the “Holders”).
Any capitalized term used but not defined herein will have the meaning ascribed to such term in the Merger Agreement (as defined below).


 


RECITALS


 


WHEREAS,
the Company and GH Group, Inc., a Delaware corporation (“GH”) are party to that certain Agreement and Plan of
Merger dated as of April 8, 2021 (as amended, the “Merger Agreement”), pursuant to which, on the Closing Date,
the Company will indirectly acquire GH;


 


WHEREAS,
pursuant to the Merger Agreement, the Holders are receiving subordinate, restricted or limited voting shares (the “Subordinate
Shares”) of the Company or shares of an Affiliate exchangeable therefor (the “Exchangeable Shares”);


 


WHEREAS,
in connection with the transactions contemplated under the Merger Agreement, the Company’s founders (as defined in the
Company’s prospectus dated May 7, 2019 and listed under the heading Founders Lock-Up Parties on the signature page hereto
(collectively, the “Founders Lock-Up Parties”)) and certain of the founders of GH listed on Schedule A attached
hereto (the “GH Lock-Up Parties”) will, subject to the terms hereof, enter into customary lockup agreements restricting
the sale of 50% of the shares of the Company held by such persons for six (6) months following closing of the Transaction and the
remaining 50% for twelve (12) months following closing of the Transaction.


 


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


 


ARTICLE I


DEFINITIONS


 


1.1
Definitions. The terms defined in this Article I shall, for all purposes of this Agreement, have
the respective meanings set forth below:


 


“Affiliate”
means, with respect to a specified person, each other person that directly, or indirectly through one or more intermediaries, controls
or is controlled by, or is under common control with, the person specified. As used in this definition, “control” (including
with correlative meanings, “controlled by” and “under common control with”) means possession, directly or indirectly,
of power to direct or cause the direction of management or policies (whether through ownership of voting securities or by contract or
other agreement).


 


“Agreement” shall have the meaning
given in the Preamble.


 


“Board” shall mean the Board of
Directors of the Company.


 


“Change in Control”
means: (a) a reorganization, merger, consolidation or a similar transaction, in any case in which the holders of the voting stock
of the Company prior to such transaction do not hold (in substantially the same proportion) a majority of the voting power of the resulting
entity (or an entity that wholly owns the resulting entity); or (b) any person becomes the beneficial owner of securities representing
25% or more of the voting rights attached to shares of the Company other than the GH Lock-Up Parties; or (c) a sale of all or substantially
all of the assets of the Company and its subsidiaries (other than an internal reorganization).


 






     


     


    

 


“Closing” shall have the meaning
given to such term in the Merger Agreement.


 


“Closing Date” shall mean the date
of this Agreement.


 


“Company” shall have the meaning
given in the Preamble.


 


“Exchangeable Shares” shall have
the meaning given in the Recitals hereto.


 


“ Excluded Shares”
means Subordinate Shares (i) to be forfeited at Closing by the Sponsor pursuant to the amended Investor Rights Agreement, (ii) to
be transferred by the Sponsor to one or more investors in connection with the private placement carried out by the Company and an Affiliate
in conjunction with the transaction, (iii) transferred to one or more investors in connection with any non-redemption agreement or
similar agreement to facilitate a redemption withdrawal entered into by the Company in conjunction with the transaction on or prior to
the Closing Date, or (iv) to be transferred by the Sponsor to TPCO or an affiliate if a financing and cannabis supply arrangement
is subsequently entered into with them by the Company and the Sponsor.


 


“Founders”
shall mean Mercer Park Brand, L.P., Charles Miles, and Sean Goodrich, and their respective Affiliates.


 


“Founders Lock-Up
Party” shall have the meaning given in the Recitals, and any of their respective Permitted Transferees.


 


“Founders Lock-Up
Period” shall mean, (A) with respect to the initial 50% of the Founders Lock-Up Shares, excluding any Excluded Shares,
the period ending on the date that is six (6) months after the Closing Date, and (B) with respect to the remaining 50% of the
Founders Lock-Up Shares, excluding any Excluded Shares, the period ending on the date that is twelve (12) months after the Closing Date.


 


“ Founders Lock-Up
Shares” shall mean any Subordinate Shares that are held by any Founders Lock-Up Party immediately after the Closing, but
excluding any Excluded Shares, as adjusted to appropriately reflect any stock split, reverse stock split, stock dividend, reorganization,
reclassification, combination, recapitalization, or like change with respect to the Subordinate Shares.


 


“GH” shall have the meaning given
in the Recitals.


 


“GH Lock-Up Party”
shall have the meaning given in the Recitals, and any of their respective Permitted Transferees.


 


“GH Lock-Up Period”
shall mean, (A) with respect to the initial 50% of the GH Lock-Up Shares, the period ending on the date that is six (6) months
after the Closing Date, and (B) with respect to the remaining 50% of the GH Lock-Up Shares, the period ending on the date that is
twelve (12) months after the Closing Date.


 


“GH Lock-Up Shares”
shall mean any Subordinate Shares and Exchangeable Shares held by any GH Lock-Up Party immediately after the Closing, as adjusted to appropriately
reflect any stock split, reverse stock split, stock dividend, reorganization, reclassification, combination, recapitalization, or like
change with respect to the Subordinate Shares.


 


“Holders” shall have the meaning
given in the Preamble.


 


“Lock-Up Period” means either the
Founders Lock-Up Period or the GH Lock-Up Period.


 


“Merger Agreement” shall have the
meaning given in the Recitals hereto.


 






     


     


    

 


“Permitted Transferees”
shall mean a person or entity to whom either a Founders Lock-Up Party or a GH Lock-Up Party is permitted to Transfer such Founders Lock-Up
Shares or GH Lock-Up Shares, respectively, prior to the expiration of the Founders Lock-Up Period or the GH Lock-Up Period, as applicable,
pursuant to Section 2.2 of this Agreement, and to any Permitted Transferee thereafter (but for greater certainty shall not
include the recipients of Excluded Shares).


 


“Sponsor Warrants”
means warrants to purchase Subordinate Shares issued to the Founders in connection with the initial public offering of the Company, excluding
any that are forfeited by the Sponsor at Closing pursuant to the amended Investor Rights Agreement.


 


“Subordinate Shares” shall have
the meaning given in the Recitals hereto.


 


“Transfer”
means to, directly or indirectly, sell, transfer, assign, pledge, encumber, hypothecate or similarly dispose of, either voluntarily or
involuntarily, or to enter into any contract, option or other arrangement or understanding with respect to the sale, transfer, assignment,
pledge, encumbrance, hypothecation or similar disposition of, any interest owned by a person or any interest (including a beneficial interest)
in, or the ownership, control or possession of, any interest owned by a person.


 


ARTICLE II


LOCK-UP


 


2.1 Transfer Restrictions.


 


2.1.1
Except as permitted by Section 2.2, each Founders Lock-Up Party shall not Transfer any Founders Lock-Up Shares
beneficially owned or owned of record by such Holder unless and until the Founders Lock-Up Period applicable to such Founders Lock-Up
Shares has expired.


 


2.1.2
Except as permitted by Section 2.2, each GH Lock-Up Party shall not Transfer any GH Lock-Up Shares beneficially
owned or owned of record by such Holder unless and until the GH Lock-Up Period applicable to such GH Lock-Up Shares has expired.


 


		2.2	Exceptions.



 


		2.2.1	The provisions of Section 2.1 shall not apply to:



 


2.2.1.1
transactions relating to Subordinate Shares acquired by the undersigned in open market transactions or relating to Subordinate
Shares resulting from the exercise of the Company’s warrants (other than Sponsor Warrants) in open market transactions;


 


		2.2.1.2	Transfers as a bona fide gift or gifts, or to a charitable organization;



 


2.2.1.3 Transfers
to a spouse, domestic partner, parent, sibling, child or grandchild of the undersigned or any other person with whom the undersigned
has a relationship by blood, marriage or adoption not more remote than first cousin (collectively, such person’s
 “Immediate Family”) or to a trust, or other entity formed for estate planning purposes for the primary benefit of
Immediate Family;


 


2.2.1.4
if the undersigned is an individual, Transfers by will or intestate succession upon the death of the undersigned;


 


2.2.1.5
the Transfer by operation of law or pursuant to a court order or settlement agreement, such as pursuant to a qualified domestic
order or the dissolution of marriage or civil union (including, without limitation, a divorce settlement);


 






     


     


    

 


2.2.1.6 if
the undersigned is a corporation, partnership (whether general, limited or otherwise), limited or unlimited liability company, trust
or other business entity, (i) Transfers to another corporation, partnership, limited or unlimited liability company, trust,
syndicate, association or other business entity that controls, is controlled by or is under common control or management with the
undersigned or its Affiliates, including to the trustor or beneficiary of such trust or to the estate of a beneficiary of such
trust, and (ii) distributions of Subordinate Shares or Exchangeable Shares to any general partner, limited partner, members,
equity holders, shareholders or owners of equity interests in the undersigned or any of its Affiliates;


 


2.2.1.7
Transfers (i) to the Company or the Company’s officers, directors or their Affiliates and (ii) to the officers,
directors or Affiliates of the undersigned;


 


2.2.1.8
In the case of the GH Lock-Up Parties, Transfers in connection with the repurchase by the Company of securities pursuant to
any repurchase right arising upon the termination of the such Holder’s employment or service with the Company;


 


2.2.1.9
pledges of Subordinate Shares or Exchangeable Shares to a nationally recognized financial institution to secure a bona fide
debt financing and any foreclosure by such financial institution or transfer to such financial institution in lieu of foreclosure;


 


2.2.1.10
Transfers pursuant to a bona fide third-party tender offer, take-over bid, merger, amalgamation, arrangement, share sale, share
exchange, liquidation, recapitalization, consolidation or other transaction involving a Change in Control of the Company or which results
in all of the Company’s shareholders having the right to exchange their equity in the Company for cash, securities or other property,
provided that in the event that such transaction is not completed, the Subordinate Shares and Exchangeable Shares subject to this
Agreement shall remain subject to this Agreement; and


 


2.2.1.11 Excluded
Shares;


 


provided,
that in the case of any Transfer or distribution pursuant to subsections 2.2.1.2 through 2.2.1.7, each donee, distributee or other
transferee shall agree in writing, in form and substance reasonably satisfactory to the Company, to be bound by the provisions of this
Agreement.


 


2.3 Legends.


 


2.3.1
During a Lock-Up Period, each certificate or book-entry position evidencing any securities subject to such Lock-Up Period (for
greater certainty excluding any Excluded Shares) shall be marked with a legend in substantially the following form, in addition to any
other applicable legends:


 


“THE SECURITIES REPRESENTED HEREBY
ARE SUBJECT TO RESTRICTIONS ON TRANSFER SET FORTH IN A LOCK-UP AGREEMENT, DATED AS OF JUNE 29, 2021, BY AND AMONG GLASS HOUSE BRANDS INC.
AND THE REGISTERED HOLDER OF THE SHARES. A COPY OF SUCH AGREEMENT WILL BE FURNISHED WITHOUT CHARGE BY GLASS HOUSE BRANDS INC. TO THE HOLDER
HEREOF UPON WRITTEN REQUEST.”


 


2.3.2
For the avoidance of doubt, each Holder shall retain all of its rights as a shareholder of the Company with respect to the
securities subject to a Lock-Up Period, including the right to vote any such securities that are entitled to vote. The Company agrees
to (i) instruct its transfer agent to remove the legends in subsection 2.3.1 upon the expiration of a Lock-Up Period and (ii) cause
its legal counsel, at the Company’s expense, to deliver the necessary legal opinions, if any, to the transfer agent in connection
with the instruction under subclause (i).


 






     


     


    

 


ARTICLE III


MISCELLANEOUS


 


3.1 Notices.


 


3.1.1
Any notice or communication under this Agreement must be in writing and given by (a) deposit in the United States mail
or Canada Post, as applicable, addressed to the party to be notified, postage prepaid and registered or certified with return receipt
requested, (b) delivery in person or by courier service providing evidence of delivery, or (c) transmission by hand delivery,
electronic mail, telecopy, telegram or facsimile. Each notice or communication that is mailed, delivered, or transmitted in the manner
described above shall be deemed sufficiently given, served, sent, and received, in the case of mailed notices, on the third business day
following the date on which it is mailed and, in the case of notices delivered by courier service, hand delivery, electronic mail, telecopy,
telegram or facsimile, at such time as it is delivered to the addressee (with the delivery receipt or the affidavit of messenger) or at
such time as delivery is refused by the addressee upon presentation. Any notice or communication under this Agreement must be addressed,
if to the Company, to: Glass House Brands Inc., 3645 Long Beach Boulevard, Long Beach, California 90807, Attention: Kyle D. Kazan, [Redacted]
and, if to any Holder, at such Holder’s address or facsimile number as set forth in the Company’s books and records. Any party
may change its address for notice at any time and from time to time by written notice to the other parties hereto, and such change of
address shall become effective thirty (30) days after delivery of such notice as provided in this Section 3.1.


 


3.2 Assignment; No Third
Party Beneficiaries.


 


3.2.1
This Agreement and the rights, duties and obligations of the Company hereunder may not be assigned or delegated by the Company
in whole or in part.


 


3.2.2
Prior to the expiration of the Founders Lock-Up Period and the GH Lock-Up Period, no Founders Lock-Up Party or GH Lock-Up Party,
as applicable, may assign or delegate such Holder’s rights, duties or obligations under this Agreement, in whole or in part, except
as permitted in Section 2.2 of this Agreement.


 


3.2.3
This Agreement and the provisions hereof shall be binding upon and shall inure to the benefit of each of the parties and its
successors and the permitted assigns of the applicable Holders, which shall include Permitted Transferees.


 


3.2.4
This Agreement shall not confer any rights or benefits on any persons that are not parties hereto, other than as expressly
set forth in this Agreement and Section 3.2 hereof.


 


3.2.5
No assignment by any party hereto of such party’s rights, duties and obligations hereunder shall be binding upon or obligate
the Company unless and until the Company shall have received (a) written notice of such assignment as provided in Section 3.1
hereof and (b) the written agreement of the assignee, in a form reasonably satisfactory to the Company, to be bound by the terms
and provisions of this Agreement (which may be accomplished by an addendum or certificate of joinder to this Agreement). Any Transfer
or assignment made other than as provided in this Section 3.2 shall be null and void.


 


3.3 Counterparts.


 


3.3.1
This Agreement may be executed in multiple counterparts (including facsimile or PDF counterparts), each of which shall be deemed
an original, and all of which together shall constitute the same instrument, but only one of which need be produced.


 






     


     


    

 


3.4 Governing Law; Venue.


 


3.4.1
Notwithstanding the place where this Agreement may be executed by any of the parties hereto, the parties expressly agree that,
to the fullest extent permitted by applicable law, (i) this Agreement shall be governed by and construed under the laws of the province
of British Columbia and the federal laws of Canada applicable therein, without regard to the conflict of law provisions of such jurisdiction
and (ii) the venue for any action taken with respect to this Agreement shall be any court located in Vancouver, British Columbia.


 


3.4.2
Each party hereto acknowledges and agrees that any controversy which may arise under this Agreement is likely to involve complicated
and difficult issues, and, therefore, each such party hereby irrevocably and unconditionally waives to the fullest extent permitted by
applicable law, any right such party may have to a trial by jury in respect to any action directly or indirectly arising out of, under
or in connection with or relating to this Agreement or the transactions contemplated by this Agreement.


 


3.5 Amendments and Modifications.


 


3.5.1
Upon the written consent of the Company and the Holders of at least a majority of the Subordinate Shares and Exchangeable Shares
subject hereto at the time in question, compliance with any of the provisions, covenants and conditions set forth in this Agreement may
be waived, or any of such provisions, covenants or conditions may be amended or modified; provided, however, that notwithstanding the
foregoing, any amendment hereto or waiver hereof that adversely affects one Holder, solely in its capacity as a holder of Subordinate
Shares or Exchangeable Shares, in a manner that is adverse and different from the other Holders (in such capacity) shall require the consent
of the Holder so affected. No course of dealing between any Holder or the Company and any other party hereto or any failure or delay on
the part of a Holder or the Company in exercising any rights or remedies under this Agreement shall operate as a waiver of any rights
or remedies of any Holder or the Company. No single or partial exercise of any rights or remedies under this Agreement by a party shall
operate as a waiver or preclude the exercise of any other rights or remedies hereunder or thereunder by such party.


 


3.6 Term.


 


3.6.1
This Agreement shall terminate 12 months following the date hereof, unless terminated earlier in accordance with Section 3.6.2.


 


3.6.2 Notwithstanding
anything in this Agreement and in accordance with Section 9.12 of the Merger Agreement, (i) if during the period
commencing on the Closing Date and ending on the expiry of the GH Lock-Up Period, the Company, either directly or indirectly by
amendment, merger, consolidation or otherwise, does any of the following acts listed below in this Section 3.6.2 without prior
written consent of the Sellers’ Representative, the GH Lock-Up Period will immediately terminate and be of no further force or
effect, or (ii) if during the period commencing on the Closing Date and ending on the expiry of the Founders Lock-Up Period,
the Company, either directly or indirectly by amendment, merger, consolidation or otherwise, does any of the following acts listed
below in this Section 3.6.2 without prior written consent of the Founders Lock-Up Parties, the Founders Lock-Up Period will
immediately terminate and be of no further force or effect. The acts referred to above are: (a) the liquidation or winding up
of the Company; (b) a Change in Control of the Company pursuant to a merger or similar business combination transaction (other
than in pursuant to an internal reorganization); or (c) the sale of a majority (or greater) of the shares of capital stock of
the Company or of all or substantially all the consolidated assets of the Company (other than an internal reorganization).


 


[Signature Pages Follow]


 






     


     


    

 


IN WITNESS WHEREOF, the undersigned have caused
this Agreement to be executed as of the date first written above.


 


	 	COMPANY:
	 	GLASS HOUSE BRANDS INC.
	 	 
	 	 	 
	 	By:	(signed) “Kyle
    Kazan”
	 	 	Name: Kyle
    Kazan
	 	 	Title: Chief
    Executive Officer
	 	 	 
	 	 	 
	 	Founders Lock-Up Parties:
	 	 	 
	 	MERCER PARK BRAND, L.P., by its general partner, MERCER PARK CB GP II, L.L.C
	 	 	 
	 	 	 
	 	By: 	(signed) “Johnathan
    Sandelman”
	 	 	Name: Johnathan
    Sandelman
	 	 	Title: Managing
    Member
	 	 	 
	 	 	 
	 	(signed by Founders Locked-Up Parties) 
	 	[Redacted]


 






     


     


    

 


	 	GH
    LOCK-UP
    PARTIES:
	 	 
	 	(signed by GH Locked-Up Parties) 
	 	[Redacted]


 






     


     


    

 


Schedule A


 


GH Lock-Up Parties


 


[Redacted – Personal Information.]


 


Founders Lock-Up Parties


 


1. Mercer Park Brand, L.P.


 


[Redacted – Personal Information.]