# EDGAR Filing Document

**Accession Number:** 0001892480
**File Stem:** 0001477932-23-000749
**Filing Date:** 2023-2
**Character Count:** 952153
**Document Hash:** 63266eac380824534bdc037ae9ba081d
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001477932-23-000749.hdr.sgml**: 20230203

**ACCESSION NUMBER**: 0001477932-23-000749

**CONFORMED SUBMISSION TYPE**: S-1

**PUBLIC DOCUMENT COUNT**: 76

**FILED AS OF DATE**: 20230203

**DATE AS OF CHANGE**: 20230203

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Hempacco Co., Inc.
- **CENTRAL INDEX KEY:** 0001892480
- **STANDARD INDUSTRIAL CLASSIFICATION:** CIGARETTES [2111]
- **IRS NUMBER:** 834231457
- **STATE OF INCORPORATION:** NV
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** S-1
- **SEC ACT:** 1933 Act
- **SEC FILE NUMBER:** 333-269566
- **FILM NUMBER:** 23587062

**BUSINESS ADDRESS:**
- **STREET 1:** 9925 AIRWAY RD
- **CITY:** SAN DIEGO
- **STATE:** CA
- **ZIP:** 92154
- **BUSINESS PHONE:** (619) 779-0715

**MAIL ADDRESS:**
- **STREET 1:** 9925 AIRWAY RD
- **CITY:** SAN DIEGO
- **STATE:** CA
- **ZIP:** 92154

?xml version="1.0" encoding="utf-8"?hemp_s1.htm

As filed with the Securities and Exchange Commission on February 3, 2023

**Registration No. 333-_____**

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

**WASHINGTON, D.C. 20549**

**FORM S-1**

**REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933**

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| **Hempacco Co., Inc.** |
| **(Exact name of registrant as specified in its charter)** |

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| **Nevada** | **2111** | **83-4231457** |
| (State or other jurisdiction of<br>incorporation or organization) | (Primary Standard Industrial<br>Classification Code Number) | (I.R.S. Employer<br>Identification Number) |

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**9925 Airway Road, San Diego, CA, 92154**

**<u>(619) 779-0715</u>**

(Address, including zip code, and telephone number, including area code, of registrant's principal executive offices)

**Sandro Piancone**

**Chief Executive Officer**

**9925 Airway Road, San Diego, CA, 92154**

**<u>(619) 779-0715</u>** 

(Names, address, including zip code, and telephone number, including area code, of agent for service)

***Copies to:***

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| **Lance Brunson, Esq.**<br>**Callie Tempest Jones, Esq.**<br>**Brunson Chandler & Jones, PLLC**<br>**Walker Center** <br>**175 S. Main Street, Suite 1410**<br>**Salt Lake City, UT 84111** <br>**(801) 303-5737**  | **Louis A. Bevilacqua, Esq.**<br>**Bevilacqua PLLC**<br>**1050 Connecticut Avenue, NW, Suite 500**<br>**Washington, DC 20036**<br>**(202) 869-0888**<br>|

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**Approximate date of commencement of proposed sale to the public:** As soon as practicable after this Registration Statement becomes effective.

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box. ☐

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

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| Large accelerated filer | ☐ | Accelerated filer | ☐ |
| Non-accelerated filer | ☒ | Smaller reporting company | ☒ |
|  |  | Emerging growth company | ☐ |

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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for comply with any new or revised financial accounting standards provided pursuant to Section 7(a)(2)(B) of Securities Act. ☐

**The registrant hereby amends this registration statement on such date or dates as may be necessary to delay its effective date until the registrant shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date as the Commission, acting pursuant to such Section 8(a), may determine.**

**The information in this prospectus is not complete and may be changed. These securities may not be sold until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting offers to buy these securities in any state where the offer or sale is not permitted.**

SUBJECT TO COMPLETION, DATED FEBRUARY 3, 2023

**PRELIMINARY PROSPECTUS**

![hemp_s1img1.jpg](hemp_s1img1.jpg)

**Hempacco Co., Inc.**

**4,729,729 Shares of Common Stock** 

We are offering up to 4,729,729 shares of our common stock in a firm commitment public offering. We currently estimate that the public offering price will be $1.11 per share.

Our common stock is listed on the Nasdaq Capital Market under the symbol "HPCO." On February 2, 2023, the last reported sale price of our common stock on the Nasdaq Capital Market was $1.11 per share.

After completion of this offering, investors in the offering will own approximately 16.8% of our outstanding shares of common stock, other investors will own approximately 20.8% of our outstanding shares of common stock, and approximately 62.4% of our outstanding common stock will be owned by Green Globe International, Inc., a Delaware corporation. Accordingly, we are a "controlled company" under Nasdaq corporate governance rules and are eligible for certain exemptions from these rules, though we do not intend to rely on any such exemptions. See "*Risk Factors – We will be a 'controlled company' within the meaning of the listing rules of Nasdaq and, as a result, can rely on exemptions from certain corporate governance requirements that provide protection to shareholders of other companies*" on page 24 for more information.

**Investing in our common stock involves a high degree of risk. See the section of this prospectus entitled "Risk Factors" beginning on page 11 for a discussion of information that should be considered in connection with an investment in our common stock.**

**Neither the United States Securities and Exchange Commission (the "SEC") nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.**

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|  | **PER SHARE** | **TOTAL <sup>(4)</sup>** |
| Public offering price<sup>(1)</sup> | $1.11 | $5249999 |
| Underwriting discounts and commissions<sup>(2)</sup> | $0.08 | $367500 |
| Proceeds, before expenses, to us<sup>(3)</sup> | $1.03 | $4882449 |

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(1) The public offering price per share is estimated to be $1.11 per share.

(2) We have agreed to pay the underwriter a discount equal to (i) 7% of the gross proceeds of the offering. We have agreed to sell to the Representatives, on the applicable closing date of this offering, warrants in an amount equal to 7% of the aggregate number of shares of common stock sold by us in this offering (the "Representatives' Warrants") (not including over-allotment shares). For a description of other terms of the Representatives' Warrants and a description of the other compensation to be received by the Underwriter, see "Underwriting" beginning on page 61.

(3) Excludes fees and expenses payable to the Underwriter. The total amount of Underwriter's expenses related to this offering is set forth in the section entitled "Underwriting."

(4) Assumes that the Underwriter does not exercise any portion of their over-allotment option.

We expect our total cash expenses for this offering (including cash expenses payable to our Underwriter for its out-of-pocket expenses) to be approximately $188,712, exclusive of the above discounts. In addition, we will pay additional items of value in connection with this offering that are viewed by the Financial Industry Regulatory Authority, or FINRA, as underwriting compensation. These payments will further reduce proceeds available to us before expenses. See "Underwriting" beginning on page 61.

This offering is being conducted on a firm commitment basis. The underwriter, Boustead Securities, LLC (the "Underwriter"), is obligated to take and pay for all of the shares of common stock if any such shares of common stock are taken. We have granted the Underwriter an option for a period of 45 days after the closing of this offering to purchase up to 15% of the total number of our shares of common stock to be offered by us pursuant to this offering (excluding shares of common stock subject to this option), solely for the purpose of covering over-allotments, at the public offering price less the underwriting discounts and commissions. If the underwriters exercise their option in full, the total underwriting discounts and commissions payable will be $422,625 based on the estimated offering price of $1.11 per share, and the total gross proceeds to us, before underwriting discounts and commissions and expenses, will be $6,037,499. If we complete this offering, net proceeds will be delivered to us on the applicable closing date.

The Underwriter expects to deliver the shares of common stock against payment as set forth under "Underwriting", on or about _____________, 2023.

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| BOUSTEAD SECURITIES, LLC | EF HUTTON |
|  | Division of Benchmark Investments, LLC |

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Prospectus dated February 3, 2023.

2<br>

**<u>**TABLE OF CONTENTS**</u>**

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|  | Page |
| [Prospectus Summary](#ps) | 5 |
| [Risk Factors](#rf) | 11 |
| [Cautionary Statement Regarding Forward-Looking Statements](#csrf) | 26 |
| [Use of Proceeds](#up) | 27 |
| [Dividend Policy](#dp) | 28 |
| [Capitalization](#c) | 29 |
| [Dilution](#d) | 30 |
| [Management's Discussion and Analysis of Financial Condition and Results of Operations](#mda) | 31 |
| [Corporate History and Structure](#chs) | 31 |
| [Business](#b) | 40 |
| [Management](#m) | 47 |
| [Executive Compensation](#ec) | 51 |
| [Certain Relationships and Related Party Transactions](#crrpt) | 53 |
| [Principal Shareholders](#primciple) | 55 |
| [Description of Securities](#ds) | 56 |
| [Shares Eligible for Future Sale](#sefs) | 59 |
| [Material U.S. Federal Tax Considerations for Non-U.S. Holders of Our Common Stock](#muf) | 60 |
| [Underwriting](#u) | 63 |
| [Legal Matters](#lm) | 66 |
| [Experts](#e) | 66 |
| [Where You Can Find More Information](#wyc) | 67 |
| [Financial Statements](#fs) | F-1 |

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| *[**Table of Contents**](#toc)* |

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**Please read this prospectus carefully. It describes our business, financial condition, results of operations and prospects, among other things. We are responsible for the information contained in this prospectus and in any free-writing prospectus we have authorized. Neither we nor the underwriters have authorized anyone to provide you with different information, and neither we nor the underwriters take responsibility for any other information others may give you. Neither we nor the underwriters are making an offer to sell these securities in any jurisdiction where the offer or sale is not permitted. The information contained in this prospectus is accurate only as of the date on the front of this prospectus, regardless of the time of delivery of this prospectus or any sale of securities. You should not assume that the information contained in this prospectus is accurate as of any date other than its date.**

**TRADEMARKS, TRADE NAMES AND SERVICE MARKS**

We use various trademarks, trade names and service marks in our business, including "Disrupting Tobacco," "HempBox," "Hempbar," "The Real Stuff," "Solito," and "Cali Vibes D8." For convenience, we may not include the SM, <sup>®</sup> or <sup>™</sup> symbols, but such omission is not meant to indicate that we would not protect our intellectual property rights to the fullest extent allowed by law. Any other trademarks, trade names or service marks referred to in this prospectus are the property of their respective owners.

**INDUSTRY AND MARKET DATA**

This prospectus includes industry data and forecasts that we obtained from industry publications and surveys including but not limited to certain publications of *Hemp Industry Daily - Sector Snapshot - Smokable Hemp*, as well as public filings and internal company sources. Industry publications, surveys and forecasts generally state that the information contained therein has been obtained from sources believed to be reliable, but there can be no assurance as to the accuracy or completeness of the included information. Statements as to our ranking, market position and market estimates are based on third-party forecasts, management's estimates and assumptions about our markets and our internal research. We have not independently verified such third-party information, nor have we ascertained the underlying economic assumptions relied upon in those sources, and we cannot assure you of the accuracy or completeness of such information contained in this prospectus. Such data involve risks and uncertainties and is subject to change based on various factors, including those discussed under "Risk Factors" and "Cautionary Statement Regarding Forward-Looking Statements."

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| *[**Table of Contents**](#toc)* |

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 **PROSPECTUS SUMMARY**<br>*This summary highlights selected information contained elsewhere in this prospectus. This summary is not complete and does not contain all of the information that you should consider before deciding whether to invest in our securities. You should carefully read the entire prospectus, including the risks associated with an investment in our company discussed in the "Risk Factors" section of this prospectus, before making an investment decision. Some of the statements in this prospectus are forward-looking statements. See the section titled "Cautionary Statement Regarding Forward-Looking Statements."*<br>*In this prospectus, "we," "us," "our," "our company" and similar references refer to Hempacco Co., Inc., a Nevada corporation formerly known as The Hempacco Co., Inc.*<br>**OUR COMPANY**<br>**Overview**<br>We are focused on Disrupting Tobacco™ by manufacturing and selling nicotine-free and tobacco-free alternatives to traditional cigarettes. We utilize a proprietary, patented spraying technology for terpene infusion and patent-pending flavored filter infusion technology to manufacture hemp and herb-based smokable alternatives. <br>We have conducted research and development in the smokables space and are engaged in the manufacturing and sale of smokable hemp and herb products, including The Real Stuff™ Hemp Smokables. Our operational segments include private label manufacturing and sales, intellectual property licensing, and the development and sales of inhouse brands using patented counter displays. Our inhouse brands are currently sold in over 200 retail locations located in the San Diego, California, area, our private label customers include well-known and established companies in the cannabis and tobacco-alternatives industries, and we currently own approximately 600 kiosk vending machines which we plan to refurbish and use to distribute our products in a wider fashion under our HempBox Vending brand. <br>Our hemp cigarette production facility, located in San Diego, California, has the capacity to produce up to 30 million cigarettes monthly. From our facility, we can ship small-to-large quantities of product—from single displays of product to targeted retail locations to truckloads of product to private label customers—with in-house processing, packing, and shipping capabilities. <br>We believe that our manufacturing technologies will be a critical component of our success. We plan to continue to invest in research and development, and we currently have one approved patent and one patent pending with respect to our critical manufacturing processes. Our approved patent is an exclusivity patent to spray hemp with terpenes for flavoring or to add cannabidiol, which we refer to as CBD, or cannabigerol, which we refer to as CBG, and our pending patent relates to our flavored filter infusion technology. We also have several ready-to-file patent applications with respect to hemp manufacturing, hemp processing, design patents for hemp machines and merchandisers, and customized manufacturing equipment. <br>We believe that we are positioned to rapidly grow our customer and product footprint through increasing marketing efforts, reaching agreements with master distributors who will sell to a broad network of retail establishments, and aggressively targeting additional distributors throughout the United States. We plan to drive and increase customer traffic with internet marketing to or with the clients that carry our products.<br>We have experienced operating losses to date and negative cash flows from operating activities. We expect to continue to incur significant expenses related to our expanding operations and to generate operating losses in the near future. The size of our losses will depend, in part, on the rate of future expenditures and our ability to generate revenues. We incurred a net loss of $1,049,473 and $2,024,039 for the three and nine months ended September 30, 2022, respectively, a net loss of $1,870,675 for the year ended December 31, 2021, our accumulated deficit increased to $5,490,216 as of September 30, 2022, we had a working capital surplus of $3,558,716 as of September 30, 2022, and we had cash and cash equivalents of $2,973,686 as of September 30, 2022.<br>Although our audited financial statements for the years ended December 31, 2021 and 2020, were prepared under the assumption that we would continue our operations as a going concern, the report of our independent registered public accounting firm that accompanies our financial statements for the years ended December 31, 2021 and 2020, contains a going concern qualification in which such firm expressed substantial doubt about our ability to continue as a going concern, based on our financial statements and results at that time, including our net loss of $1,870,675 during the year ended December 31, 2021, our accumulated deficit of $3,459,214 as of December 31, 2021, and our working capital deficit of $2,050,626 as of December 31, 2021. <br>**Our Products**<br>We have launched the production and sale of our own in-house brand of hemp-based cigarettes, The Real Stuff Smokables, in three presentations: the twenty pack, the ten pack, and the Solito™ single pack, all of which are sold in our patented counter displays in convenience stores through master distributors. <br>We have also entered into several joint ventures to launch multiple smokables brands: Cali Vibes D8, a joint venture focused on Delta 8 smokable products; Hemp Hop Smokables, a joint venture with rapper Rick Ross and Rap Snack's CEO James Lindsay; a joint venture with StickIt Ltd., an Israeli corporation, to manufacture cannabinoid sticks for insertion into other cigarettes; a joint venture to launch Cheech & Chong-branded hemp smokables; Hempacco Paper Co., Inc., a joint venture with Sonora Paper Co., Inc. focused on rolling papers; Organipure, Inc., a joint venture with High Sierra Technologies, Inc. focused on hemp smokables; and HPDG, LLC, a joint venture to launch smokables products with Alfalfa Holdings, LLC. <br>We have launched a brand of flavored hemp rolling papers, and we also manufacture private label hemp rolling papers for third parties. We are currently manufacturing hemp rolling papers for HBI International, one of the leading smoking paper producers in the world, and in the fall of 2021, we received our largest purchase order to date for approximately $9.2 million from HBI International's Skunk and Juicy brand to manufacture hemp rolling papers for it. <br>

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| *[**Table of Contents**](#toc)* |

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| Our products include the following:<br>![hemp_s1img2.jpg](hemp_s1img2.jpg)<br>**Competitive Strengths**<br>We believe our manufacturing technologies, manufacturing facility manufacturing capacity, and management with extensive industry experience are strengths that set us apart from our competitors. Our manufacturing facility can quickly scale up production volumes, our management team has extensive experience in the cigarette and food and beverage industries, and because of our manufacturing technologies, which allow us to spray hemp with terpenes for flavoring or to add CBD or CBG, and add flavoring via our filter infusion technology, we believe our smokables products offer consistent and unique flavor and odor profiles to consumers, which we believe sets our products apart from competing products, which may lack flavor and odor consistency or smell like marijuana when smoked. <br>**Growth Strategy**<br>We seek to become the leader in sales and distribution of alternative smokable products. We aim to offer our products and affiliate products in over 100,000 convenience and liquor stores in the United States, and we also intend to build international sales and distribution channels for our products and affiliate products. Our goal is to build a portfolio of non-tobacco smokables brands, become the United States market leader in the space, and subsequently build exclusive master distribution relationships in other countries. We plan to do this in four ways:  | Our products include the following:<br>![hemp_s1img2.jpg](hemp_s1img2.jpg)<br>**Competitive Strengths**<br>We believe our manufacturing technologies, manufacturing facility manufacturing capacity, and management with extensive industry experience are strengths that set us apart from our competitors. Our manufacturing facility can quickly scale up production volumes, our management team has extensive experience in the cigarette and food and beverage industries, and because of our manufacturing technologies, which allow us to spray hemp with terpenes for flavoring or to add CBD or CBG, and add flavoring via our filter infusion technology, we believe our smokables products offer consistent and unique flavor and odor profiles to consumers, which we believe sets our products apart from competing products, which may lack flavor and odor consistency or smell like marijuana when smoked. <br>**Growth Strategy**<br>We seek to become the leader in sales and distribution of alternative smokable products. We aim to offer our products and affiliate products in over 100,000 convenience and liquor stores in the United States, and we also intend to build international sales and distribution channels for our products and affiliate products. Our goal is to build a portfolio of non-tobacco smokables brands, become the United States market leader in the space, and subsequently build exclusive master distribution relationships in other countries. We plan to do this in four ways:  |
| ● | We intend to focus on growing our fast-moving consumer goods brands, such as our "The Real Stuff" smokables and "Hempbar," our line of "liquor flavored" infused hemp smokables for sale in liquor stores and bars. |
| ● | We plan to build a portfolio of patents and technologies, which should allow us to protect and grow our competitive position in the industry. |
| ● | We intend to expand our manufacturing capabilities. |
| ● | We plan to increase sales by focusing on master distributor relationships, e-commerce sales, and distribution of our brands, and joint venture brands. |
| **Our Corporate History and Structure**<br>We were incorporated in the State of Nevada on April 1, 2019, as "The Hempacco Co., Inc.," and on April 23, 2021, changed our name to "Hempacco Co., Inc." On May 21, 2021, we were acquired by Green Globe International, Inc., a Delaware corporation ("Green Globe"), and became a wholly owned subsidiary of it, and as of immediately prior to this offering, we are a majority-owned subsidiary of Green Globe International, Inc., with Green Globe International, Inc. owning approximately 78.7% of our capital stock. Additional information regarding our corporate history and transactions in connection with our prior acquisition by Green Globe are discussed more fully in the "*Our Corporate History and Structure*" section of "*Management's Discussion and Analysis of Financial Condition and Results of Operations*" beginning on page 31.  | **Our Corporate History and Structure**<br>We were incorporated in the State of Nevada on April 1, 2019, as "The Hempacco Co., Inc.," and on April 23, 2021, changed our name to "Hempacco Co., Inc." On May 21, 2021, we were acquired by Green Globe International, Inc., a Delaware corporation ("Green Globe"), and became a wholly owned subsidiary of it, and as of immediately prior to this offering, we are a majority-owned subsidiary of Green Globe International, Inc., with Green Globe International, Inc. owning approximately 78.7% of our capital stock. Additional information regarding our corporate history and transactions in connection with our prior acquisition by Green Globe are discussed more fully in the "*Our Corporate History and Structure*" section of "*Management's Discussion and Analysis of Financial Condition and Results of Operations*" beginning on page 31.  |

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**Impact of the COVID-19 Pandemic**<br>In December 2019, a novel coronavirus disease ("COVID-19") was reported to have surfaced in Wuhan, China, and on March 11, 2020, the World Health Organization characterized COVID-19 as a pandemic. The pandemic, which has continued to spread, and the related adverse public health developments, including orders to shelter-in-place, travel restrictions, and mandated business closures, have adversely affected workforces, organizations, customers, economies, and financial markets globally, leading to an economic downturn and increased market volatility. It has also disrupted the normal operations of many businesses, including ours.<br>Our operations have been impacted by a range of external factors related to the pandemic that are not within our control. For example, many cities, counties, states, and even countries have imposed or may impose a wide range of restrictions on the physical movement of our employees, partners and customers to limit the spread of the pandemic, including physical distancing, travel bans and restrictions, closure of non-essential business, quarantines, work-from-home directives, shelter-in-place orders, and limitations on public gatherings. These measures have caused, and are continuing to cause, business slowdowns or shutdowns in affected areas, both regionally and worldwide. In 2020, we temporarily scaled down sales efforts at trade shows and with customers and potential customers in in-person meetings, and we were forced to source ingredients for some of the components of our products from alternative suppliers. These changes disrupted our business, and similar changes in the future may disrupt the way we operate our business. In addition, our management team has, and will likely continue, to spend significant time, attention and resources monitoring the pandemic and seeking to minimize the risk of the virus and manage its effects on our business. <br>The duration and extent of the impact from the pandemic depends on future developments that cannot be accurately predicted at this time, such as the severity and transmission rate of the virus, the extent and effectiveness of containment actions and the disruption caused by such actions, the effectiveness of vaccines and other treatments for COVID-19, and the impact of these and other factors on our employees, customers, partners and vendors. If we are not able to respond to and manage the impact of such events effectively, our business will be harmed.<br>To the extent the pandemic adversely affects our business and financial results, it may also have the effect of heightening many of the other risks described in the "Risk Factors" section.<br>**Corporate Information**<br>We are currently incorporated and in good standing in the State of Nevada. Our principal executive offices are located at 9925 Airway Road, San Diego, California, 92154, and our telephone number is (619) 779-0715. We maintain a website at https://hempaccoinc.com/. Information available on our website is not incorporated by reference in and is not deemed a part of this prospectus, and you should not consider any information contained on, or that can be accessed through, our website as part of this prospectus or in deciding whether to purchase our common stock.<br>

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| **THE OFFERING** | **THE OFFERING** |
| Shares being offered: | Up to 4,729,729 shares of common stock (or 5,439,188 shares if the underwriter exercises the over-allotment option in full). |
| Offering price: | We currently estimate that the public offering price will be $1.11 per share. |
| Shares outstanding immediately before the offering: | 23,477,999 shares of common stock.<br>|
| Shares outstanding after the offering: | 28,207,728 shares of common stock (or 28,917,187 shares if the underwriters exercise the over-allotment option in full). |
| Over-allotment option: | We have granted to the underwriters a 45-day option to purchase from us up to an additional 15% of the shares sold in the offering (709,459 additional shares) at the public offering price, less the underwriting discounts and commissions. |
| Representatives' warrants: | We have agreed to issue to the representatives of the underwriter (the "Representatives") warrants to purchase a number of shares of common stock equal in the aggregate to 7% of the total number of shares issued in this offering. The Representatives' warrants will be exercisable at a per share exercise price equal to 100% of the public offering price per share of common stock sold in this offering. The Representatives' warrants will be exercised at any time, and from time to time, in whole or in part, commencing from the closing of the offering and expiring five (5) years from the effectiveness of the offering. The registration statement of which this prospectus forms a part also registers the issuance of the shares of common stock issuable upon exercise of the Representatives' warrants. See the "*Underwriting*" section for more information. |
| Use of proceeds: | We expect to receive net proceeds of approximately $4,641,287 from this offering (or approximately $5,365,787 if the underwriters exercise their over-allotment option in full), based on the estimated public offering price of $1.11 per share and no exercise of the underwriters' over-allotment option, and after deducting estimated underwriting discounts and commissions and estimated offering expenses payable by us. We plan to use the net proceeds of this offering for sales, marketing and advertising initiatives; acquisitions of companies and technologies aligned and synergistic with our manufacturing technologies and growth objectives; expansion and upgrades to our existing manufacturing facility; research and development; hiring sales and other employees; expenses associated with being a public company; and general corporate and working capital purposes. See "*Use of Proceeds*" section for more information on the use of proceeds. |
| Risk factors: | Investing in our common stock involves a high degree of risk. As an investor, you should be able to bear a complete loss of your investment. You should carefully consider the information set forth in the "*Risk Factors*" section beginning on page 11 before deciding to invest in our common stock. |
| Lock-up: | Our executive officers, directors and our majority shareholder have agreed not to offer, sell, agree to sell, directly or indirectly, or otherwise dispose of any shares of our common stock for a lock-up period through August 30, 2023, and we have agreed not to offer or sell any shares of stock until September 1, 2023. See "*Underwriting*" for more information. |
| Trading market and symbol: | Our common stock is listed on the Nasdaq Capital Market under the symbol "HPCO." |
| The number of shares of common stock outstanding immediately following this offering is based on 23,477,999 shares outstanding as of February 3, 2023. | The number of shares of common stock outstanding immediately following this offering is based on 23,477,999 shares outstanding as of February 3, 2023. |

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**SUMMARY FINANCIAL INFORMATION**<br>The following tables summarize certain financial data regarding our business and should be read in conjunction with our financial statements and related notes contained elsewhere in this prospectus and the information under "*Management's Discussion and Analysis of Financial Condition and Results of Operations*."<br>Our summary financial data as of December 31, 2021 and 2020, are derived from our audited financial statements included elsewhere in this prospectus. Our summary financial data as of September 30, 2022 and 2021, are derived from our unaudited financial statements included elsewhere in this prospectus. All financial statements included in this prospectus are prepared and presented in accordance with generally accepted accounting principles in the United States ("GAAP"). The summary financial information is only a summary and should be read in conjunction with the historical financial statements and related notes contained elsewhere herein. The financial statements contained elsewhere fully represent our financial condition and operations; however, they are not indicative of our future performance.<br>Although our audited financial statements for the years ended December 31, 2021 and 2020, were prepared under the assumption that we would continue our operations as a going concern, the report of our independent registered public accounting firm that accompanies our financial statements for the years ended December 31, 2021 and 2020, contains a going concern qualification in which such firm expressed substantial doubt about our ability to continue as a going concern, based on our financial statements and results at that time, including our net loss of $1,870,675 during the year ended December 31, 2021, our accumulated deficit of $3,459,214 as of December 31, 2021, and our working capital deficit of $2,050,626 as of December 31, 2021.<br>

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|  | **Three Months Ended**<br>**September 30,** | **Three Months Ended**<br>**September 30,** | **Nine Months Ended**<br>**September 30,** | **Nine Months Ended**<br>**September 30,** | **Years Ended**<br>**December 31,** | **Years Ended**<br>**December 31,** |
|  | **2022** | **2021** | **2022** | **2021** | **2021** | **2020** |
|  | (unaudited) | (unaudited) | (unaudited) | (unaudited) | | |
| **Statements of Operations Data** |  |  |  |  |  |  |
| Revenue | $592235 | $425171 | $3438458 | $911008 | $1187273 | $345989 |
| Cost of Sales | 598627 | 315281 | 2795661 | 613784 | 850901 | 899699 |
| Gross Profit (Loss) from Operations | (6392) | 109890 | 642797 | 297224 | 336372 | (553710) |
| Operating Expenses | 1037538 | 423679 | 2638647 | 1237423 | 1995705 | 751279 |
| Operating Loss | (1043930) | (313789) | (1995850) | (940199) | (1659333) | (1304989) |
| Other Income / (Expense) | (5543) | (53514) | (28189) | (256504) | (211342) | (160455) |
| Net Loss | (1049473) | (367303) | (2024039) | (1196703) | (1870675) | (1465444) |
| Net Loss Attributable to Non-Controlling Interests | 617 |  | 2200 |  | 14250 |  |
| Net Loss Attributable to Hempacco Co., Inc. | (1048856) | (367303) | (2021839) | (1196703) | (1856425) | (1465444) |
| Dividend Issued to Preferred Stockholders |  |  |  |  | (757479) |  |
| Net Loss Attributable to Common Stockholders | (1048856) | (367303) | (2021839) | (1196703) | (2613904) | (1465444) |

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|  | | **As of**<br>**December 31** | **As of**<br>**December 31** |
|  | **As of**<br>**September 30,**<br>**2022** | **2021** | **2020** |
|  | (unaudited) |  |  |
| **Balance Sheet Data** |  |  |  |
| Cash and Cash Equivalents  | $2973686 | $933469 | $500 |
| Total Current Assets | 5197591 | 2117638 | 101462 |
| Total Assets | 14664060 | 7570523 | 5657894 |
| Total Current Liabilities | 1638875 | 4168264 | 2931761 |
| Total Liabilities | 2083505 | 4702863 | 3435326 |
| Accumulated Deficit | (5490216) | (3459214) | (1602789) |
| Total Stockholder's Equity | 12587842 | 2881910 | 2222568 |
| Non-Controlling Interests | (7287) | (14250) |  |
| Total Equity for Hempacco Co., Inc. | 12580555 | 2867660 | 2222568 |
| Total Liabilities and Stockholder's Equity  | 14664060 | 7570523 | 5657894 |

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| **SUMMARY OF RISK FACTORS**<br>An investment in our common stock involves a high degree of risk. You should carefully consider the risks summarized below. These risks are discussed more fully in the "*Risk Factors*" section immediately following this Prospectus Summary. These risks include, but are not limited to, the following:  | **SUMMARY OF RISK FACTORS**<br>An investment in our common stock involves a high degree of risk. You should carefully consider the risks summarized below. These risks are discussed more fully in the "*Risk Factors*" section immediately following this Prospectus Summary. These risks include, but are not limited to, the following:  | **SUMMARY OF RISK FACTORS**<br>An investment in our common stock involves a high degree of risk. You should carefully consider the risks summarized below. These risks are discussed more fully in the "*Risk Factors*" section immediately following this Prospectus Summary. These risks include, but are not limited to, the following:  |
|  | ·  | Since inception, we have experienced operating losses and negative cash flows from operating activities and anticipate that we will continue to incur operating losses in the near future. |
|  | ·  | If we are not able to successfully execute on our future operating plans, our financial condition and results of operation may be materially adversely affected, and we may not be able to continue as a going concern. |
|  | ·  | We may be unable to effectively manage future growth. We will need additional financing in the future, which may not be available when needed or may be costly and dilutive. |
|  | ·  | If we are unable to continue as a going concern, our securities will have little or no value. |
|  | ·  | We have a limited operating history, and we may not be able to successfully operate our business or execute our business plan. |
|  | ·  | We may incur significant debt to finance our operations. |
|  | ·  | We compete in an industry that is brand-conscious, so brand name recognition and acceptance of our products are critical to our success. |
|  | ·  | Our brand and image are keys to our business and any inability to maintain a positive brand image could have a material adverse effect on our results of operations. |
|  | ·  | Competition from traditional and large, well-financed tobacco or nicotine cigarette manufacturers or distributors may adversely affect our distribution relationships and may hinder development of our existing markets, as well as prevent us from expanding our markets. |
|  | ·  | We compete in an industry characterized by rapid changes in consumer preferences and public perception, so our ability to continue developing new products to satisfy our consumers' changing preferences will determine our long-term success. |
|  | ·  | We may be unable to respond effectively to technological changes in our industry, which could reduce the demand for our products. |
|  | ·  | We may experience a reduced demand for some of our products due to health concerns and legislative initiatives against smokables products. |
|  | ·  | Legislative or regulatory changes that affect our products, including new taxes, could reduce demand for products or increase our costs. |
|  | ·  | Our ability to develop, commercialize and distribute hemp smokables products and comply with laws and regulations governing cannabis, hemp or related products will affect our operational results. |
|  | ·  | International expansion efforts would likely significantly increase our operational expenses. |
|  | ·  | Our reliance on distributors, retailers and brokers could affect our ability to efficiently and profitably distribute and market our products, maintain our existing markets and expand our business into other geographic markets. |
|  | ·  | We incur significant time and expense in attracting and maintaining key distributors, and loss of distributors or retails accounts would harm our business. |
|  | ·  | We rely on suppliers, manufacturers and contractors, and events adversely affecting them would adversely affect us. |
|  | · | We have a single customer that accounts for a substantial portion of our revenues, and our business would be harmed were we to lose this customer. |
|  | ·  | Wholesale price volatility may adversely affect operations. |

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| The Company may sustain losses that cannot be recovered through insurance or other preventative measures. |
| The Company may be subject to product liability claims and other claims of our customers and partners. |
| If we encounter product recalls or other product quality issues, our business may suffer. |
| It is difficult to predict the timing and amount of our sales, and as a result our sales forecasts are uncertain. |
| If we do not adequately manage our inventory levels, our operating results could be adversely affected. |
| Increases in costs or shortages of raw materials could harm our business and financial results. |
| Increases in costs of energy and increased regulations may have an adverse impact on our gross margin. |
| Disruption within our supply chain, contract manufacturing or distribution channels could have an adverse effect on our business, financial condition and results of operations. |
| If we are unable to attract and retain key personnel, our efficiency and operations would be adversely affected; in addition, staff turnover causes uncertainties and could harm our business. |
| If we lose the services of our Chief Executive Officer, our future operations could be impaired until such time as a qualified replacement can be found. |
| If we fail to protect our trademarks and trade secrets, we may be unable to successfully market our products and compete effectively. |
| Disruptions to our information technology systems due to cyber-attacks or our failure to upgrade and adjust our information technology systems, may materially impair our operations, hinder our growth and materially and adversely affect our business and results of operations. |
| Our business is subject to many regulations and noncompliance is costly. |
| Significant additional labeling or warning requirements may inhibit sales of affected products. |
| Our industry may become subject to expanded regulation and increased enforcement by the Food and Drug Administration (FDA) and the Federal Trade Commission (FTC) |
| Our business and operations would be adversely impacted in the event of a failure or interruption of our information technology infrastructure or as a result of a cybersecurity attack. |
| Our results of operations may fluctuate from quarter to quarter for many reasons, including seasonality. |
| Global economic, political, social and other conditions, including the COVID-19 pandemic, may continue to adversely impact our business and results of operations. |
| We may not be able to satisfy the continued listing requirements of Nasdaq and maintain a listing of our common stock on Nasdaq. |
| We are majority-owned by Green Globe International, Inc. ("GGII"), a small group of Company officers and directors hold a majority of the control of GGII, those officers and directors are able to control the election of members of GGII's Board of Directors as well as the election of members of our Board of Directors, and they are able to generally exercise control over our affairs. |
| Our executive officers and the majority of our directors are also officers and directors of GGII, and conflicts of interest may arise as a result. |
| We are a "controlled company" within the meaning of the listing rules of Nasdaq and, as a result, can rely on exemptions from certain corporate governance requirements that provide protection to shareholders of other companies. |
| During the nine months ended September 30, 2022, GGII advanced $621,755 in funding to us, and we may need additional funding from GGII in the future, which may not be available when needed. |

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**RISK FACTORS**

*An investment in our securities involves a high degree of risk. You should carefully consider the following risk factors, together with the other information contained in this prospectus, before purchasing our securities. We have listed below (not necessarily in order of importance or probability of occurrence) what we believe to be the most significant risk factors applicable to us, but they do not constitute all of the risks that may be applicable to us. Any of the following factors could harm our business, financial condition, results of operations or prospects, and could result in a partial or complete loss of your investment. Some statements in this prospectus, including statements in the following risk factors, constitute forward-looking statements. Please refer to the section titled "Cautionary Statement Regarding Forward-Looking Statements".*

*We may not be successful in preventing the material adverse effects that any of the following risks and uncertainties may cause. These potential risks and uncertainties may not be a complete list of the risks and uncertainties facing us. There may be additional risks and uncertainties that we are presently unaware of, or presently consider immaterial, that may become material in the future and have a material adverse effect on us. You could lose all or a significant portion of your investment due to any of these risks and uncertainties.*

**Risks Related to our Financial Condition and Capital Requirements**

***Since inception, we have experienced operating losses and negative cash flows from operating activities and anticipate that we will continue to incur operating losses in the near future.***

We have experienced operating losses to date and negative cash flows from operating activities. We expect to continue to incur significant expenses related to our expanding operations and to generate operating losses in the near future. The size of our losses will depend, in part, on the rate of future expenditures and our ability to generate revenues. We incurred a net loss of $1,049,473 and $2,024,039 for the three and nine months ended September 30, 2022, respectively, a net loss of $1,870,675 for the year ended December 31, 2021, and our accumulated deficit increased to $5,490,216 as of September 30, 2022.

We may encounter unforeseen expenses, difficulties, complications, delays, and other unknown factors that may adversely affect our financial condition. Our prior losses and expected future losses have had, and will continue to have, an adverse effect on our financial condition. If our products do not achieve sufficient market acceptance and our revenues do not increase significantly, we may never become profitable. Even if we achieve profitability in the future, we may not be able to sustain profitability in subsequent periods. Our failure to become and remain profitable would decrease the value of our company and could impair our ability to raise capital, expand our business, diversify our product offerings or continue our operations. A decline in the value of our company could cause you to lose all or part of your investment.

***If we are not able to successfully execute on our future operating plans, our financial condition and results of operation may be materially adversely affected, and we may not be able to continue as a going concern.***

It is critical that we meet our sales goals and increase sales going forward as our operating plan already reflects prior significant cost containment measures and may make it difficult to achieve top-line growth if further significant reductions become necessary. If we do not meet our sales goals, our available cash and working capital will decrease and our financial condition will be negatively impacted.

***We may be unable to effectively manage future growth.***

We may be subject to growth-related risks, including capacity constraints and pressure on our internal systems and controls. Our ability to manage growth effectively will require us to continue to implement and improve our operational and financial systems and to expand, train and manage our employee base. Rapid growth of our business may significantly strain our management, operations and technical resources. If we are successful in obtaining large orders for its products, we will be required to deliver large volumes of products to our customers on a timely basis and at a reasonable cost. We may not obtain large-scale orders for our products and if we do, we may not be able to satisfy large-scale production requirements on a timely and cost-effective basis. Our inability to deal with this growth may have a material adverse effect on our business, financial condition, results of operations and prospects.

***We will need additional financing in the future, which may not be available when needed or may be costly and dilutive.***

We will require additional financing to support our working capital needs in the future. The amount of additional capital we may require, the timing of our capital needs and the availability of financing to fund those needs will depend on a number of factors, including our strategic initiatives and operating plans, the performance of our business and the market conditions for debt or equity financing. Additionally, the amount of capital required will depend on our ability to meet our sales goals and otherwise successfully execute our operating plan. We believe it is imperative that we meet these sales objectives in order to lessen our reliance on external financing in the future. We intend to continually monitor and adjust our operating plan as necessary to respond to developments in our business, our markets and the broader economy. Although we believe various debt and equity financing alternatives will be available to us to support our working capital needs, financing arrangements on acceptable terms may not be available to us when needed. Additionally, these alternatives may require significant cash payments for interest and other costs or could be highly dilutive to our existing shareholders. Any such financing alternatives may not provide us with sufficient funds to meet our long-term capital requirements. If necessary, we may explore strategic transactions that we consider to be in the best interest of the Company and our shareholders, which may include, without limitation, public or private offerings of debt or equity securities, a rights offering, and other strategic alternatives; however, these options may not ultimately be available or feasible when needed.

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***If we are unable to continue as a going concern, our securities will have little or no value.***

Although our financial statements have been prepared under the assumption that we would continue our operations as a going concern, there is substantial doubt about our ability to continue as a going concern, based on our financial statements and results of operations at that time. Specifically, as noted above, we have experienced losses from operations and negative cash flows from operating activities due primarily to relatively high general and administrative expenses associated with launching our business, as well as an inventory obsolescence allowance expense. An inventory obsolescence allowance was created as a precautionary measure with regard to a large quantity of hemp biomass that is currently being used in production of our products, which we expect will be consumed within 6 to 12 months. All or a portion the allowance is expected to be credited back as other income as the biomass is used, but there is no guarantee that the biomass will be used, and that the allowance will be credited back as other income.

Although our audited financial statements for the years ended December 31, 2021 and 2020, were prepared under the assumption that we would continue our operations as a going concern, the report of our independent registered public accounting firm that accompanies our financial statements for the years ended December 31, 2021 and 2020, contains a going concern qualification in which such firm expressed substantial doubt about our ability to continue as a going concern, based on our financial statements and results at that time, including our net loss of $1,870,675 during the year ended December 31, 2021, our accumulated deficit of $3,459,214 as of December 31, 2021, and our working capital deficit of $2,050,626 as of December 31, 2021.

We expect to continue to incur significant expenses and operating losses for the foreseeable future. These prior losses and expected future losses have had, and will continue to have, an adverse effect on our financial condition. In addition, as noted above, continued operations and our ability to continue as a going concern may be dependent on our ability to obtain additional financing in the near future and thereafter, and there are no assurances that such financing will be available to us at all or will be available in sufficient amounts or on reasonable terms. Our financial statements do not include any adjustments that may result from the outcome of this uncertainty. If we are unable to generate additional funds in the future through sales of our products, financings or from other sources or transactions, we will exhaust our resources and will be unable to continue operations. If we cannot continue as a going concern, our shareholders would likely lose most or all of their investment in us.

***We have a limited operating history, and we may not be able to successfully operate our business or execute our business plan.***

The Company was formed on April 1, 2019, and it is still in its development stage. We are therefore subject to many of the risks common to early-stage enterprises, including under-capitalization, cash shortages, limitations with respect to personnel, financial, and other resources and lack of revenues. Given our limited operating history, it is hard to evaluate our proposed business and prospects. Our proposed business operations will be subject to numerous risks, uncertainties, expenses and difficulties associated with early- stage enterprises. There is no assurance that we will be successful in achieving a return on shareholders' investment, and the likelihood of success must be considered in light of the early stage of our hemp smokables operations.

***We may incur significant debt to finance our operations.***

There is no assurance that we will not incur debt in the future, that we will have sufficient funds to repay our indebtedness, or that we will not default on our debt, jeopardizing our business viability. Furthermore, we may not be able to borrow or raise additional capital in the future to meet the Company's needs or to otherwise provide the capital necessary to conduct our business.

**Risk Factors Relating to Our Business and Industry**

***We compete in an industry that is brand-conscious, so brand name recognition and acceptance of our products are critical to our success.***

Our business is substantially dependent upon awareness and market acceptance of our products and brands by our target market: trendy, young consumers looking for a distinctive product tonality and/or the perceived benefits of hemp, CBD and CBG in their smokables as compared to nicotine or tobacco-based smokables. In addition, our business depends on acceptance by our independent distributors and retailers of our brands that have the potential to provide incremental sales growth. If we are not successful in the growth of our brand and product offerings, we may not achieve and maintain satisfactory levels of acceptance by independent distributors and retail consumers. In addition, we may not be able to effectively execute our marketing strategies in light of the various closures and cancellations caused by the COVID-19 pandemic. Any failure of our brands to maintain or increase acceptance or market penetration would likely have a material adverse effect on our revenues and financial results.

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***Our brand and image are keys to our business and any inability to maintain a positive brand image could have a material adverse effect on our results of operations.***

Our success depends on our ability to maintain brand image for our existing products and effectively build up brand image for new products and brand extensions. We cannot predict whether our advertising, marketing and promotional programs will have the desired impact on our products' branding and on consumer preferences. In addition, negative public relations and product quality issues, including negative perceptions regarding the hemp industry, whether real or imagined, could tarnish our reputation and image of the affected brands and could cause consumers to choose other products. Our brand image can also be adversely affected by unfavorable reports, studies and articles, litigation, or regulatory or other governmental action, whether involving our products or those of our competitors.

***Competition from traditional and large, well-financed tobacco or nicotine cigarette manufacturers or distributors may adversely affect our distribution relationships and may hinder development of our existing markets, as well as prevent us from expanding our markets.***

The smokables industry is highly competitive. We compete with other smokables companies, including with "Big Tobacco" manufacturers and distributors, not only for consumer acceptance but also for shelf space in retail outlets and for marketing focus by our distributors, many of whom also distribute other smokables brands. Our products compete with both tobacco-based and hemp-based smokables, many of which are marketed by companies with substantially greater financial resources than ours. Some of these competitors are placing severe pressure on independent distributors not to carry competitive hemp brands such as ours. We also compete with regional hemp smokables producers and "private label" smokables suppliers.

Our direct competitors in the smokables industry include large domestic and international traditional tobacco companies and distributors as well as regional or niche smokables companies. These national and international competitors have advantages such as lower production costs, larger marketing budgets, greater financial and other resources and more developed and extensive distribution networks than ours. We may not be able to grow our volumes or maintain our selling prices, whether in existing markets or as we enter new markets.

Increased competitor consolidations, market-place competition, particularly among branded hemp smokables products, and competitive product and pricing pressures could impact our earnings, market share and volume growth. If, due to such pressure or other competitive threats, we are unable to sufficiently maintain or develop our distribution channels, we may be unable to achieve our current revenue and financial targets. As a means of maintaining and expanding our distribution network, we intend to introduce additional brands. We may not be successful in doing this, or it may take us longer than anticipated to achieve market acceptance of these new products and brands, if at all. Other companies may be more successful in this regard over the long term. Competition, particularly from companies with greater financial and marketing resources than ours, could have a material adverse effect on our existing markets, as well as on our ability to expand the market for our products.

***We compete in an industry characterized by rapid changes in consumer preferences and public perception, so our ability to continue developing new products to satisfy our consumers' changing preferences will determine our long-term success.***

Failure to introduce new brands, products or product extensions into the marketplace as current ones mature and to meet our consumers' changing preferences could prevent us from gaining market share and achieving long-term profitability. Product lifecycles can vary, and consumers' preferences and loyalties change over time. We may not succeed at innovating new products to introduce to our consumers. Customer preferences also are affected by factors other than taste, such as health and nutrition considerations and obesity concerns, shifting consumer needs, changes in consumer lifestyles, increased consumer information and competitive product and pricing pressures. Sales of our products may be adversely affected by the negative publicity associated with these issues. In addition, there may be a decreased demand for our products as a result of the COVID-19 pandemic. If we do not adequately anticipate or adjust to respond to these and other changes in customer preferences, we may not be able to maintain and grow our brand image and our sales may be adversely affected.

***We may be unable to respond effectively to technological changes in our industry, which could reduce the demand for our products.***

Our future business success will depend upon our ability to maintain and enhance our product portfolio with respect to advances in technological improvements for certain products and market products that meet customer needs and market conditions in a cost-effective and timely manner. Maintaining and enhancing our product portfolio may require significant investments in licensing fees and royalties. We may not be successful in gaining access to new products that successfully compete or are able to anticipate customer needs and preferences, and our customers may not accept one or more of our products. If we fail to keep pace with evolving technological innovations or fail to modify our products and services in response to customers' needs or preferences, then our business, financial condition and results of operations could be adversely affected.

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***We may experience a reduced demand for some of our products due to health concerns and legislative initiatives against smokables products.***

Consumers are concerned about health and wellness; public health officials and government officials are increasingly vocal about smoking, vaping, and their adverse consequences. There has been a trend among many public health advocates to pursue generalized reduction in consumption of smokables products, as well as increased public scrutiny, new taxes on smokables products, and additional governmental regulations concerning the marketing and labeling/packing of smokable products. Additional or revised regulatory requirements, whether labeling, tax or otherwise, could have a material adverse effect on our financial condition and results of operations. Further, increasing public concern with respect to smokables could reduce demand for our hemp smokables products.

***Legislative or regulatory changes that affect our products, including new taxes, could reduce demand for products or increase our costs.***

Taxes imposed on the sale of certain of our products by federal, state, and local governments in the United States, or other countries in which we operate could cause consumers to shift away from purchasing our hemp smokables products. These taxes could materially affect our business and financial results.

***Our ability to develop, commercialize and distribute hemp smokables products and comply with laws and regulations governing cannabis, hemp or related products will affect our operational results.***

As of December 31, 2021, more than 40 states had enacted legislation to establish hemp production programs pursuant to the 2018 farm bill (the Agricultural Improvement Act of 2018, the "2018 Farm Bill"), which legalized the regulated production of hemp.

The 2018 Farm Bill was signed into law on December 20, 2018. The 2018 Farm Bill removed hemp from the U.S. Controlled Substances Act (the "CSA") and established a federal regulatory framework for hemp production in the United States. Among other provisions, the 2018 Farm Bill: (a) explicitly amends the CSA to exclude all parts of the cannabis plant (including its cannabinoids, derivatives, and extracts) containing a delta-9 THC concentration of not more than 0.3% on a dry weight basis from the CSA's definition of "marihuana"; (b) permits the commercial production and sale of hemp; (c) precludes states, territories, and Indian tribes from prohibiting the interstate transport of lawfully-produced hemp through their borders; and (d) establishes the USDA as the primary federal agency regulating the cultivation of hemp in the United States, while allowing states, territories, and Indian tribes to obtain (or retain) primary regulatory authority over hemp activities within their borders after receiving approval of their proposed hemp production plan from the USDA. Any such plan submitted by a state, territory, or Indian tribe to the USDA must meet or exceed minimum federal standards and receive USDA approval. Any state, territory, or Indian tribe that does not submit a plan to the USDA, or whose plan is not approved by the USDA, will be regulated by the USDA; provided that, states retain the ability to prohibit hemp production within their borders.

Marijuana continues to be classified as a Schedule I substance under the CSA. As a result, any cannabinoids (including CBD) derived from marijuana, as opposed to hemp, or any products derived from hemp containing in excess of 0.3% THC on a dry-weight basis, remain Schedule I substances under U.S. federal law. Cannabinoids derived from hemp are indistinguishable from those derived from marijuana, and confusion surrounding the nature of our smokables products containing hemp or CBD, inconsistent interpretations of the definition of "hemp", inaccurate or incomplete testing, farming practices and law enforcement vigilance or lack of education could result in our products being intercepted by federal and state law enforcement as marijuana and could interrupt and/or have a material adverse impact on the Company's business. The Company could be required to undertake processes that could delay shipments, impede sales or result in seizures, proper or improper, that would be costly to rectify or remove and which could have a material adverse effect on the business, prospects, results of operations or financial condition of the Company. If the Company makes mistakes in processing or labeling, and THC in excess of 0.3% on a dry-weight basis is found in our products, the Company could be subject to enforcement and prosecution under local, state, and federal laws which would have a negative impact on the Company's business and operations.

Under the 2018 Farm Bill, states have authority to adopt their own regulatory regimes, and as such, regulations will likely continue to vary on a state-by-state basis. States take varying approaches to regulating the production and sale of hemp and hemp-derived products under state food and drug laws. The variance in state law and that state laws governing hemp production are rapidly changing may increase the chance of unfavorable law enforcement interpretation of the legality of Company's operations as they relate to the cultivation of hemp. Further, such variance in state laws that may frequently change increases the Company's compliance costs and risk of error.

While some states explicitly authorize and regulate the production and sale of hemp products or otherwise provide legal protection for authorized individuals to engage in commercial hemp activities, other states maintain outdated drug laws that do not distinguish between marijuana, hemp and/or hemp-derived CBD, resulting in hemp being classified as a controlled substance under state law. In these states, sale of CBD, notwithstanding origin, is either restricted to state medical or adult-use marijuana program licensees or remains otherwise unlawful under state criminal laws. Variance in hemp regulation across jurisdictions is likely to persist. This patchwork of state laws may, for the foreseeable future, materially impact the Company's business and financial condition, limit the accessibility of certain state markets, cause confusion amongst regulators, and increase legal and compliance costs.

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There are no express protections in the United States under applicable federal or state law for possessing or processing hemp biomass derived from lawful hemp not exceeding 0.3% THC on a dry weight basis and intended for use in finished product, but that may temporarily exceed 0.3% THC during the interim processing stages. While it is a common occurrence for hemp biomass to have variance in THC content during interim processing stages after cultivation but prior to use in finished products, there is risk that state or federal regulators or law enforcement could take the position that such hemp biomass is a Schedule I controlled substance in violation of the CSA and similar state laws. Further, there is a risk that state regulators and/or law enforcement may interpret provisions of state law prohibiting unlawful marijuana activity to apply to in-process hemp at any facility where we manufacture our hemp smokables products so that such activity is considered unlawful under state law.

In the event that the Company's operations are deemed to violate any laws or if we are deemed to be assisting others to violate a state or federal law, the Company could be subject to enforcement actions and penalties, and any resulting liability could cause the Company to modify or cease its operations.

Continued development of the industrial hemp and cannabis industries will be dependent upon new legislative authorization of industrial hemp and cannabis at the state level, and further amendment or supplementation of legislation at the federal level. Any number of events or occurrences could slow or halt progress all together in this space. While progress within the industrial hemp and cannabis industries is currently encouraging, growth is not assured. While there appears to be ample public support for favorable legislative action, numerous factors may impact or negatively affect the legislative process(es) within the various states where we have business interests. Any one of these factors could slow or halt use of industrial hemp and cannabis, which could negatively impact our business and financial results.

In addition, the general manufacture, labeling and distribution of our hemp smokables products is regulated by various federal, state, and local agencies. These governmental authorities may commence regulatory or legal proceedings, which could restrict the permissible scope of our product claims or the ability to sell products in the future.

The shifting compliance environment and the need to build and maintain robust systems to comply with different compliance in multiple jurisdictions increases the possibility that we may violate one or more of the requirements. If our operations are found to be in violation of any of such laws or any other governmental regulations that apply to our business, we may be subject to penalties, including, without limitation, civil and criminal penalties, damages, fines, the curtailment or restructuring of our operations, any of which could adversely affect the ability to operate our business and its financial results.

***International expansion efforts would likely significantly increase our operational expenses.***

We may in the future expand into other geographic areas, which could increase our operational, regulatory, compliance, reputational and foreign exchange rate risks. The failure of our operating infrastructure to support such expansion could result in operational failures and regulatory fines or sanctions. Future international expansion could require us to incur a number of up-front expenses, including those associated with obtaining regulatory approvals, as well as additional ongoing expenses, including those associated with infrastructure, staff and regulatory compliance. We may not be able to successfully identify suitable acquisition and expansion opportunities or integrate such operations successfully with our existing operations.

***Our reliance on distributors, retailers and brokers could affect our ability to efficiently and profitably distribute and market our products, maintain our existing markets and expand our business into other geographic markets.***

Our ability to maintain and expand our existing markets for our products, and to establish markets in new geographic distribution areas, is dependent on our ability to establish and maintain successful relationships with reliable distributors, retailers and brokers strategically positioned to serve those areas. Most of our distributors, retailers and brokers sell and distribute competing products, including tobacco-based or nicotine-based smokables products, and our products may represent a small portion of their businesses. The success of our distribution network will depend on the performance of the distributors, retailers, and brokers in our network. There is a risk they may not adequately perform their functions within the network by, without limitation, failing to distribute to sufficient retailers or positioning our products in localities that may not be receptive to our product. Our ability to incentivize and motivate distributors to manage and sell our products is affected by competition from other hemp smokables companies who have greater resources than we do. To the extent that our distributors, retailers and brokers are distracted from selling our products or do not employ sufficient efforts in managing and selling our products, including re-stocking the retail shelves with our products, our sales and results of operations could be adversely affected. Furthermore, such third parties' financial position or market share may deteriorate, which could adversely affect our distribution, marketing and sales activities.

Our ability to maintain and expand our distribution network and attract additional distributors, retailers and brokers will depend on a number of factors, some of which are outside our control. Some of these factors include:

· the level of demand for our brands and products in a particular distribution area;

· our ability to price our products at levels competitive with those of competing products; and

· our ability to deliver products in the quantity and at the time ordered by distributors, retailers and brokers.

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We may not be able to successfully manage all or any of these factors in any of our current or prospective geographic areas of distribution. Our inability to achieve success with regards to any of these factors in a geographic distribution area will have a material adverse effect on our relationships in that particular geographic area, thus limiting our ability to maintain or expand our market, which will likely adversely affect our revenues and financial results.

***We incur significant time and expense in attracting and maintaining key distributors, and loss of distributors or retails accounts would harm our business.***

Our marketing and sales strategy depends in large part on the availability and performance of our independent distributors. We currently do not have, nor do we anticipate in the future that we will be able to establish, long-term contractual commitments from some of our distributors. We may not be able to maintain our current distribution relationships or establish and maintain successful relationships with distributors in new geographic distribution areas. Moreover, there is the additional possibility that we may have to incur additional expenditures to attract and maintain key distributors in one or more of our geographic distribution areas in order to profitably exploit our geographic markets.

We currently have approximately ten distributors who service numerous retail accounts. If we were to lose any of our distributors, or if they were to lose national, regional or larger retail accounts, our financial condition and results of operations could be adversely affected. While we continually seek to expand and upgrade our distributor network, we may not be able to maintain our distributor or retailer base. The loss of any of our distributors, or their significant retail accounts, could have adverse effects on our revenues, liquidity and financial results, could negatively impact our ability to retain our relationships with our other distributors and our ability to expand our market, and would place increased dependence on our other independent distributors and national accounts.

***The COVID-19 pandemic has and could continue to negatively affect various aspects of our business, make it more difficult for us to meet our obligations to our customers, and result in reduced demand for our products and services, which could have a material adverse effect on our business, financial condition, results of operations, or cash flows.***

In December 2019, a novel strain of coronavirus was reported to have surfaced in Wuhan, China, and it has since spread throughout other parts of the world, including the United States. Any outbreak of contagious diseases or other adverse public health developments could have a material adverse effect on our business operations. These impacts to our operations have included, and could again in the future include, disruptions or restrictions on the ability of our employees and customers to travel or our ability to pursue collaborations and other business transactions, travel to customers and/or promote our products at conferences or other live events, oversee the activities of our third-party manufacturers and suppliers. We may also be impacted by the temporary closure of the facilities of suppliers, manufacturers or customers.

In an effort to halt the outbreak of COVID-19, a number of countries, including the United States, placed significant restrictions on travel and many businesses announced extended closures. These travel restrictions and business closures have and may in the future adversely impact our operations locally and worldwide, including our ability to manufacture, market, sell or distribute our products. Such restrictions and closure have caused or may cause temporary closures of the facilities of our suppliers, manufacturers or customers. A disruption in the operations of our employees, suppliers, customers, manufacturers or access to customers would likely impact our sales and operating results. We are continuing to monitor and assess the effects of the COVID-19 pandemic on our commercial operations; however, we cannot at this time accurately predict what effects these conditions will ultimately have on our operations due to uncertainties relating to the ultimate geographic spread of the virus, the severity of the disease, the duration of the outbreak and speed of vaccinations, and the length of the travel restrictions and business closures imposed by the governments of impacted countries. In addition, a significant outbreak of contagious diseases in the human population could result in a widespread health crisis that could adversely affect the economies and financial markets of many countries, resulting in an economic downturn that could affect demand for our products and likely impact our operating results.

***We rely on suppliers, manufacturers and contractors, and events adversely affecting them would adversely affect us.***

The Company intends to maintain a full supply chain for the provision of its hemp-based smokables products. Due to the novel and variable regulatory landscape for hemp and CBD production in the United States, the Company's third-party hemp and hemp smokables suppliers, manufacturers and contractors may elect, at any time, to decline or withdraw services necessary for the Company's operations. Loss of these suppliers, manufacturers and contractors, including for non-hemp-based ingredients in the Company's hemp smokables products, may have a material adverse effect on the Company's business, financial condition, results of operations and prospects.

In addition, any significant interruption, negative change in the availability or economics of the supply chain or increase in the prices for the ingredients in the Company's products provided by any such third-party suppliers, manufacturers and contractors could materially impact the Company's business, financial condition, results of operations and prospects. Any inability to secure required supplies or to do so on appropriate terms could have a materially adverse impact on the Company's business, financial condition, results of operations and prospects.

***We have a single customer that accounts for a substantial portion of our revenues, and our business would be harmed were we to lose this customer.***

Sales to one of our customers, HBI International, made up approximately 81.5% and 81.3% of our revenues for the three and nine months ended September 30, 2022, respectively, and approximately 41% of our revenues for the year ended December 31, 2021, and the balance receivable from HBI International at September 30, 2022, and December 31, 2021, represents approximately 46.5% of our total accounts receivable balance as of September 30, 2022, and approximately 37% of our total accounts receivable balances as of December 31, 2021, respectively. We do not have a binding purchase agreement with this customer, and were we to lose this customer, our revenues would significantly decline, and our business would be harmed.

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***Wholesale price volatility may adversely affect operations.***

The hemp smokables industry is margin-based with gross profits typically dependent on the excess of sales prices over costs. Consequently, profitability is sensitive to fluctuations in wholesale and retail prices caused by changes in supply (which itself depends on other factors such as weather, fuel, equipment and labor costs, shipping costs, economic situation and demand), taxes, government programs and policies for the hemp smokables and hemp industries (including price controls and wholesale price restrictions that may be imposed by government agencies responsible for the regulation of hemp and/or smokables products), and other market conditions, all of which are factors beyond the control of the Company. The Company's operating income will be sensitive to changes in the price of hemp and other product ingredients, and the overall condition of the hemp and smokables industries, as the Company's profitability is directly related to the price of hemp and our other smokables ingredients. There is currently not an established market price for hemp, and the price of hemp is affected by numerous factors beyond the Company's control. Ingredient price volatility may have a material adverse effect on the Company's business, financial condition, and results of operations.

***The Company may sustain losses that cannot be recovered through insurance or other preventative measures.***

There is no assurance that the Company will not incur uninsured liabilities and losses as a result of the conduct of its business. While the Company currently has some liability insurance coverage, it does not have broad coverage at high levels. The Company plans to continue to review its liability coverage in the light of its expanding operations in order to insure against potential major insurable liabilities. Should uninsured losses occur, shareholders could lose their invested capital.

***The Company may be subject to product liability claims and other claims of our customers and partners.***

The sale of hemp smokables products to consumers involves a certain level of risk of product liability claims and the associated adverse publicity. Because use of the Company's hemp smokables products could cause injury to consumers if packaging or ingredients are defective, we are subject to a risk of claims for such injuries and damages. We could also be named as co-parties in product liability suits that are brought against manufacturing partners that produce our hemp smokables products, packaging for those products, or the ingredients in those products.

In addition, our customers and partners may bring suits against us alleging damages for the failure of our products to meet stated specifications or other requirements. Any such suits, even if not successful, could be costly, disrupt the attention of our management and damage our negotiations with distributors and/or customers. Any attempt by us to limit our product liability in our contracts may not be enforceable or may be subject to exceptions. While we do have product liability insurance, our amounts of coverage may be inadequate to cover all potential liability claims. Insurance coverage, particularly as it relates to products relating to the hemp industry, is expensive, and additional coverage may be difficult to obtain. Also, additional insurance coverage may not be available in the future on acceptable terms and may not be sufficient to cover potential claims. We cannot be sure that our contract manufacturers or manufacturing partners who produce our hemp smokables products, packaging and ingredients will have adequate insurance coverage themselves to cover against potential claims. If we experience a large insured loss, it may exceed any insurance coverage limits we have at that time, or our insurance carrier may decline to cover us or may raise our insurance rates to unacceptable levels, any of which could impair our financial position and potentially cause us to go out of business.

***If we encounter product recalls or other product quality issues, our business may suffer.***

Product quality issues, real or imagined, or allegations of product contamination, even when false or unfounded, could tarnish our image and could cause consumers to choose other products. In addition, because of changing government regulations or implementation thereof, or allegations of product contamination, we may be required from time to time to recall products entirely or from specific markets. Product recalls could affect our profitability and could negatively affect brand image.

***It is difficult to predict the timing and amount of our sales, and as a result our sales forecasts are uncertain.***

Many of our white label clients (clients who we manufacture product for, and which product is labeled with the clients' own branding and then sold by the clients) are required to place minimum orders with us, but we cannot accurately predict what our sales will be. As to our own brand of smokables, The Real Stuff, the number of stores where our product is available continues to increase each month, providing a major indicator of future product demand. However, such an indicator is not dispositive, and our sales forecasts are uncertain.

Our independent distributors and national accounts are not generally required to place minimum monthly orders for our products. In order to reduce their inventory costs, independent distributors typically order products from us on a "just in time" basis in quantities and at such times based on the demand for the products in a particular distribution area. Accordingly, we cannot accurately predict the timing or quantity of purchases by any of our independent distributors or whether any of our distributors will continue to purchase products from us in the same frequencies and volumes as they may have done in the past. Additionally, our larger distributors and regional partners may make orders that are larger than we have historically been required to fill. Shortages in inventory levels, supply of raw materials or other key supplies could also negatively affect us.

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***If we do not adequately manage our inventory levels, our operating results could be adversely affected.***

We need to maintain adequate inventory levels to be able to deliver products to distributors on a timely basis. Our inventory supply depends on our ability to correctly estimate demand for our products. Our ability to estimate demand for our products is imprecise, particularly for new products, seasonal promotions and new markets. If we materially underestimate demand for our products or are unable to maintain sufficient inventory of raw materials, we might not be able to satisfy demand on a short-term basis. If we overestimate distributor or retailer demand for our products, we may end up with too much inventory, resulting in higher storage costs, increased trade spend and the risk of inventory spoilage. If we fail to manage our inventory to meet demand, we could damage our relationships with our distributors and retailers and could delay or lose sales opportunities, which would unfavorably impact our future sales and adversely affect our operating results. In addition, if the inventory of our products held by our distributors and retailers is too high, they will not place orders for additional products, which would also unfavorably impact our sales and adversely affect our operating results.

***Increases in costs or shortages of raw materials could harm our business and financial results.***

In addition to the primary ingredient, the hemp blend, other principal ingredients we use include (but are not limited to) paper wrappers, filters, glue, terpenes, labels and cardboard cartons. These manufacturing and ingredient costs are subject to fluctuation. Substantial increases in the prices of ingredients, raw materials and packaging materials, used to produce our products, to the extent that they cannot be recouped through increases in the prices of finished hemp smokables products, would increase our operating costs and could reduce our profitability. If the supply of these raw materials is impaired or if prices increase significantly, it could affect the affordability of our products and reduce sales.

If we or any contract manufacturers we may use are unable to secure sufficient ingredients or raw materials including hemp, the various paper products and filters, and other key supplies, we might not be able to satisfy demand for our hemp smokables products on a short-term basis. Moreover, in the past there have been industry-wide shortages of hemp, papers and other ingredients in our products, and these shortages could occur again from time to time in the future, which could interfere with and delay production of our products and could have a material adverse effect on our business and financial results.

In addition, suppliers could fail to provide ingredients or raw materials on a timely basis, or fail to meet our performance expectations, for a number of reasons, including, for example, disruption to the global supply chain as a result of the COVID-19 pandemic, which could cause a serious disruption to our business, increase our costs, decrease our operating efficiencies and have a material adverse effect on our business, results of operations and financial condition.

***Increases in costs of energy and increased regulations may have an adverse impact on our gross margin.***

Over the past few years, volatility in the global oil markets has resulted in high fuel prices, which many shipping companies have passed on to their customers by way of higher base pricing and increased fuel surcharges. If fuel prices increase, we expect to experience higher shipping rates and fuel surcharges, as well as energy surcharges on our raw materials. It is hard to predict what will happen in the fuel markets in 2022 and beyond. Due to the price sensitivity of our products, we may not be able to pass such increases on to our customers.

***Disruption within our supply chain, contract manufacturing or distribution channels could have an adverse effect on our business, financial condition and results of operations.***

Our ability, through our suppliers, business partners, contract manufacturers, independent distributors and retailers, to make, move and sell products is critical to our success. Damage or disruption to our suppliers or to manufacturing or distribution capabilities due to weather, natural disaster, fire or explosion, terrorism, pandemics such as COVID-19, influenza, and other viruses, labor strikes or other reasons, could impair the manufacture, distribution and sale of our products. Many of these events are outside of our control. Failure to take adequate steps to protect against or mitigate the likelihood or potential impact of such events, or to effectively manage such events if they occur, could adversely affect our business, financial condition and results of operations.

***If we are unable to attract and retain key personnel, our efficiency and operations would be adversely affected; in addition, staff turnover causes uncertainties and could harm our business.***

Our success depends on our ability to attract and retain highly qualified employees in such areas as finance, sales, marketing and product development and distribution. We compete to hire new employees, and, in some cases, must train them and develop their skills and competencies. We may not be able to provide our employees with competitive salaries, and our operating results could be adversely affected by increased costs due to increased competition for employees, higher employee turnover or increased employee benefit costs.

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Recently, we have experienced significant changes in our sales personnel, and more could occur in the future. Changes to operations, policies and procedures, which can often occur with the appointment of new personnel, can create uncertainty, may negatively impact our ability to execute quickly and effectively, and may ultimately be unsuccessful. In addition, transition periods are often difficult as the new Company personnel gain detailed knowledge of our operations, and friction can result from changes in strategy and management style. Employee turnover inherently causes some loss of institutional knowledge, which can negatively affect strategy and execution. Until we integrate new personnel, and unless they are able to succeed in their positions, we may be unable to successfully manage and grow our business, and our financial condition and profitability may suffer.

Further, to the extent we experience additional personnel turnover, our operations, financial condition and employee morale could be negatively impacted. If we are unable to attract and retain qualified management and sales personnel, our business could suffer. Moreover, our operations could be negatively affected if employees are quarantined as the result of exposure to a contagious illness such as COVID-19.

***If we lose the services of our Chief Executive Officer, our future operations could be impaired until such time as a qualified replacement can be found.***

Our business plan relies significantly on the continued services of Sandro Piancone, our Chief Executive Officer. If we were to lose the services of Mr. Piancone, our ability to obtain new business and new strategic partners, as well as our ability to manage our operations, could be materially impaired.

***We are required to indemnify our directors and officers.***

Our Articles of Incorporation and Bylaws provide that we will indemnify our officers and directors to the maximum extent permitted by Nevada law, provided that the officer or director did not act in bad faith or breach his or her duty to us or our stockholders, or that it is more likely than not that it will ultimately be determined that the officer or director has met the standards of conduct which make it permissible for under Nevada law for the Company to indemnify the officer or director. If we were called upon to indemnify an officer or director, then the portion of its assets expended for such purpose would reduce the amount otherwise available for the Company's business.

***If we fail to protect our trademarks and trade secrets, we may be unable to successfully market our products and compete effectively.***

We rely on a combination of trademark and trade secrecy laws, confidentiality procedures and contractual provisions to protect our intellectual property rights. Failure to protect our intellectual property could harm our brand and our reputation, and adversely affect our ability to compete effectively. Further, enforcing or defending our intellectual property rights, including our trademarks and trade secrets, could result in the expenditure of significant financial and managerial resources. We regard our intellectual property, particularly our trademarks and trade secrets, as crucial to our business and our success. However, the steps taken by us to protect these proprietary rights may not be adequate and may not prevent third parties from infringing or misappropriating our trademarks, trade secrets or similar proprietary rights. In addition, other parties may seek to assert infringement claims against us, and we may have to pursue litigation against other parties to assert our rights. Any such claim or litigation could be costly. In addition, any event that would jeopardize our proprietary rights or any claims of infringement by third parties could have a material adverse effect on our ability to market or sell our brands, profitably exploit our products or recoup our associated research and development costs.

***Disruptions to our information technology systems due to cyber-attacks or our failure to upgrade and adjust our information technology systems, may materially impair our operations, hinder our growth and materially and adversely affect our business and results of operations.***

We believe that an appropriate information technology, or IT, infrastructure is important in order to support our daily operations and the growth of our business. If we experience difficulties in implementing new or upgraded information systems or experience significant system failures, or if we are unable to successfully modify our management information systems or respond to changes in our business needs, we may not be able to effectively manage our business, and we may fail to meet our reporting obligations. Additionally, if our current arrangements and plans are not operated as planned, we may not be able to effectively recover our information system in the event of a crisis, which may materially and adversely affect our business and results of operations.

In the current environment, there are numerous and evolving risks to cybersecurity and privacy, including criminal hackers, hacktivists, state-sponsored intrusions, industrial espionage, employee malfeasance and human or technological error. High-profile security breaches at other companies and in government agencies have increased in recent years, and security industry experts and government officials have warned about the risks of hackers and cyber-attacks targeting businesses such as ours. Computer hackers and others routinely attempt to breach the security of technology products, services and systems, and to fraudulently induce employees, customers, or others to disclose information or unwittingly provide access to systems or data. We can provide no assurance that our current IT system or any updates or upgrades thereto and the current or future IT systems of our potential distributors use or may use in the future, are fully protected against third-party intrusions, viruses, hacker attacks, information or data theft or other similar threats. Legislative or regulatory action in these areas is also evolving, and we may be unable to adapt our IT systems or to manage the IT systems of third parties to accommodate these changes. We have experienced and expect to continue to experience actual or attempted cyber-attacks of our IT networks. Although none of these actual or attempted cyber-attacks has had a material adverse impact on our operations or financial condition, we cannot guarantee that any such incidents will not have such an impact in the future.

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***Our business is subject to many regulations and noncompliance is costly.***

The production, marketing and sale of our hemp smokables products, including contents, labels, and containers, are subject to the rules and regulations of various federal, provincial, state and local health agencies. If a regulatory authority finds that a current or future product or production batch or "run" is not in compliance with any of these regulations, we may be fined, or production may be stopped, which would adversely affect our financial condition and results of operations. Similarly, any adverse publicity associated with any noncompliance may damage our reputation and our ability to successfully market our products. Furthermore, the rules and regulations are subject to change from time to time and while we closely monitor developments in this area, we cannot anticipate whether changes in these rules and regulations will impact our business adversely. Additional or revised regulatory requirements, whether labeling, environmental, tax or otherwise, could have a material adverse effect on our financial condition and results of operations.

***Significant additional labeling or warning requirements may inhibit sales of affected products.***

Various jurisdictions may seek to adopt significant additional product labeling or warning requirements relating to the chemical content or perceived adverse health consequences of our hemp smokables products. These types of requirements, if they become applicable to one or more of our products under current or future environmental or health laws or regulations, may inhibit sales of such products. In California, a law requires that a specific warning appear on any product that contains a component listed by the state as having been found to cause cancer or birth defects. This law recognizes no generally applicable quantitative thresholds below which a warning is not required. If a component found in one of our products is added to the list, or if the increasing sensitivity of detection methodology that may become available under this law and related regulations as they currently exist, or as they may be amended, results in the detection of an infinitesimal quantity of a listed substance in one of our hemp smokables products produced for sale in California, the resulting warning requirements or adverse publicity could affect our sales.

***Our industry may become subject to expanded regulation and increased enforcement by the Food and Drug Administration (FDA) and the Federal Trade Commission (FTC).***

The FDA under the Federal Food, Drug, and Cosmetic Act regulates the formulation, manufacturing, packaging, labeling, and distribution of food, dietary supplements, drugs, cosmetic, medical devices, biologics, and tobacco products. Our products are subject to law and regulation by the FDA. Moreover, the regulatory status of our products are currently in a state of flux as the FDA attempts to determine the appropriate manner in which to regulate these products. Thus, the regulatory approach is still evolving, and we may be required to seek the FDA's approval to market our products. It is also possible that the FDA may simply issue a regulation setting forth the conditions in which such products may be marketed, or it may simply prohibit these products. However, because the FDA's regulatory process is subject to change, we cannot predict the likely outcome. In addition, the FTC under the Federal Trade Commission Act ("FTC Act") requires that product advertising be truthful, substantiated and not misleading. We believe that our advertising meets these requirements. However, the FTC may bring a challenge at any time to evaluate our compliance with the FTC Act. In addition, most states where our products are legal provide their own regulatory guidelines and regulations in connection with cigarette or other smokable product sales. Any failure by us to remain current on state regulatory changes could negatively affect our ability to operate our business.

***Litigation or legal proceedings could expose us to significant liabilities and damage our reputation.***

We may become party to litigation claims and legal proceedings. Litigation involves significant risks, uncertainties and costs, including distraction of management attention away from our business operations. We evaluate litigation claims and legal proceedings to assess the likelihood of unfavorable outcomes and to estimate, if possible, the amount of potential losses. Based on these assessments and estimates, we establish reserves and disclose the relevant litigation claims or legal proceedings, as appropriate. These assessments and estimates are based on the information available to management at the time and involve a significant amount of management judgment. Actual outcomes or losses may differ materially from those envisioned by our current assessments and estimates. Our policies and procedures require strict compliance by our employees and agents with all U.S. and local laws and regulations applicable to our business operations, including those prohibiting improper payments to government officials. Nonetheless, our policies and procedures may not ensure full compliance by our employees and agents with all applicable legal requirements. Improper conduct by our employees or agents could damage our reputation or lead to litigation or legal proceedings that could result in civil or criminal penalties, including substantial monetary fines, as well as disgorgement of profits.

***Climate change may negatively affect our business.***

There is growing concern that a gradual increase in global average temperatures may cause an adverse change in weather patterns around the globe resulting in an increase in the frequency and severity of natural disasters. Changing weather patterns could have a negative impact on agricultural productivity, which may limit availability or increase the cost of certain key ingredients such as hemp, natural flavors and other ingredients used in our products. Also, increased frequency or duration of extreme weather conditions may disrupt the productivity of our facilities, the operation of our supply chain or impact demand for our products. In addition, the increasing concern over climate change may result in more regional, federal and global legal and regulatory requirements and could result in increased production, transportation and raw material costs. As a result, the effects of climate change could have a long-term adverse impact on our business and results of operations.

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***Our business and operations would be adversely impacted in the event of a failure or interruption of our information technology infrastructure or as a result of a cybersecurity attack.***

The proper functioning of our own information technology (IT) infrastructure is critical to the efficient operation and management of our business. We may not have the necessary financial resources to update and maintain our IT infrastructure, and any failure or interruption of our IT system could adversely impact our operations. In addition, our IT is vulnerable to cyberattacks, computer viruses, worms and other malicious software programs, physical and electronic break-ins, sabotage and similar disruptions from unauthorized tampering with our computer systems. We believe that we have adopted appropriate measures to mitigate potential risks to our technology infrastructure and our operations from these IT-related and other potential disruptions. However, given the unpredictability of the timing, nature and scope of any such IT failures or disruptions, we could potentially be subject to downtimes, transactional errors, processing inefficiencies, operational delays, other detrimental impacts on our operations or ability to provide products to our customers, the compromising of confidential or personal information, destruction or corruption of data, security breaches, other manipulation or improper use of our systems and networks, financial losses from remedial actions, loss of business or potential liability, and/or damage to our reputation, any of which could have a material adverse effect on our cash flows, competitive position, financial condition or results of operations.

***Our results of operations may fluctuate from quarter to quarter for many reasons, including seasonality.***

Our sales may be seasonal, and we experience fluctuations in quarterly results as a result of many factors. We expect to generate a greater percentage of our revenues during the warm weather months of April through September. Timing of customer purchases will vary each year, and sales can be expected to shift from one quarter to another. As a result, management believes that period-to-period comparisons of results of operations are not necessarily meaningful and should not be relied upon as any indication of future performance or results expected for the fiscal year.

In addition, our operating results may fluctuate due to a number of other factors including, but not limited to:

• Our ability to maintain, develop and expand distribution channels for current and new products, develop favorable arrangements with third party distributors of our products and minimize or reduce issues associated with engaging new distributors and retailers, including, but not limited to, transition costs and expenses and down time resulting from the initial deployment of our products in each new distributor's network;

• Unilateral decisions by distributors, grocery store chains, specialty chain stores, club stores, mass merchandisers and other customers to discontinue carrying all or any of our products that they are carrying at any time; 

• Our ability to manage our resources to sufficiently support general operating activities, promotion allowances and slotting fees, promotion and selling activities, and capital expansion, and our ability to sustain profitability;

• Our ability to meet the competitive response by much larger, well-funded and established companies currently operating in the hemp smokables industry, as we introduce new competitive products, and our hemp smokables products; and

• Competitive products and pricing pressures and our ability to gain or maintain share of sales in the marketplace as a result of actions by competitors.

Due to these and other factors, our results of operations have fluctuated from period to period and may continue to do so in the future, which could cause our operating results in a particular quarter to fail to meet market expectations.

***Changes in our effective tax rate may impact our results of operations.***

We are subject to taxes in the U.S. and other jurisdictions. Tax rates in these jurisdictions may be subject to significant change due to economic and/or political conditions. A number of other factors may also impact our future effective tax rate including:

• the jurisdictions in which profits are determined to be earned and taxed;

• the resolution of issues arising from tax audits with various tax authorities;

• changes in valuation of our deferred tax assets and liabilities;

• increases in expenses not deductible for tax purposes, including write-offs of acquired intangibles and impairment of goodwill in connection with acquisitions;

• changes in availability of tax credits, tax holidays, and tax deductions;

• changes in share-based compensation; and

• changes in tax laws or the interpretation of such tax laws and changes in generally accepted accounting principles.

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Although we believe our income tax liabilities are reasonably estimated and accounted for in accordance with applicable laws and principles, an adverse resolution by one or more taxing authorities could have a material impact on the results of our operations. Further, we may be unable to utilize our net operating losses in the event a change in control is determined to have occurred.

***Global economic, political, social and other conditions, including the COVID-19 pandemic, may continue to adversely impact our business and results of operations.***

The hemp smokables industry can be affected by macro-economic factors, including changes in national, regional, and local economic conditions, unemployment levels and consumer spending patterns, which together may impact the willingness of consumers to purchase our products as they adjust their discretionary spending. Adverse economic conditions may adversely affect the ability of our distributors to obtain the credit necessary to fund their working capital needs, which could negatively impact their ability or desire to continue to purchase products from us in the same frequencies and volumes as they have done in the past. If we experience similar adverse economic conditions in the future, sales of our products could be adversely affected, collectability of accounts receivable may be compromised, and we may face obsolescence issues with our inventory, any of which could have a material adverse impact on our operating results and financial condition.

Additionally, while the extent of the continued impact on our business and financial condition is unknown at this time, we may continue to be negatively affected by COVID-19 and actions taken to address and limit the spread of COVID-19, such as travel restrictions, event cancellations, and limitations affecting the supply of labor and the movement of raw materials and finished products. If available manufacturing capacity is reduced as a result of COVID-19, it could negatively affect the timely supply, pricing and availability of finished products. Moreover, we will also be negatively impacted by current and future closures of restaurants, independent accounts, convenience chains, and retail store chains resulting from the COVID-19 outbreak. The current closures of restaurants and independent accounts will negatively affect our revenues and cash flows. Although the current status of retail and convenience chains remains unknown at this time, the future closure of these types of establishments will also adversely impact our business and financial condition.

Overall, the Company does not yet know the full extent of potential delays or impacts on its business, financing activities, or the global economy as a whole. However, these effects could have a material impact on the Company's liquidity, capital resources, operations and business and those of third parties on which we rely.

***We are currently operating in a period of economic uncertainty and capital markets disruption, which has been significantly impacted by geopolitical instability due to the ongoing military conflict between Russia and Ukraine. Our business may be materially adversely affected by any negative impact on the global economy and capital markets resulting from the conflict in Ukraine or any other geopolitical tensions.***

U.S. and global markets are experiencing volatility and disruption following the escalation of geopolitical tensions and the start of the military conflict between Russia and Ukraine. On February 24, 2022, a full-scale military invasion of Ukraine by Russian troops was reported. Although the length and impact of the ongoing military conflict is highly unpredictable, the conflict in Ukraine could lead to market disruptions, including significant volatility in commodity prices, credit and capital markets, as well as supply chain interruptions. We are continuing to monitor the situation in Ukraine and globally and assessing its potential impact on our business.

Additionally, Russia's prior annexation of Crimea, recent recognition of two separatist republics in the Donetsk and Luhansk regions of Ukraine and subsequent military interventions in Ukraine have led to sanctions and other penalties being levied by the United States, European Union and other countries against Russia, Belarus, the Crimea Region of Ukraine, the so-called Donetsk People's Republic, and the so-called Luhansk People's Republic, including agreement to remove certain Russian financial institutions from the Society for Worldwide Interbank Financial Telecommunication ("SWIFT") payment system, expansive ban on imports and exports of products to and from Russia and ban on exportation of U.S denominated banknotes to Russia or persons located there. Additional potential sanctions and penalties have also been proposed and/or threatened. Russian military actions and the resulting sanctions could adversely affect the global economy and financial markets and lead to instability and lack of liquidity in capital markets, potentially making it more difficult for us to obtain additional funds and sell the shares we are offering. The extent and duration of the military action, sanctions and resulting market disruptions are impossible to predict, but could be substantial. Any such disruptions may also magnify the impact of other risks described in this prospectus.

***Changes in accounting standards and subjective assumptions, estimates and judgments by management related to complex accounting matters could significantly affect our financial results.***

The United States generally accepted accounting principles and related pronouncements, implementation guidelines and interpretations with regard to a wide variety of matters that are relevant to our business, such as, but not limited to, stock-based compensation, inventory, revenue recognition, trade spend and promotions, and income taxes are highly complex and involve many subjective assumptions, estimates and judgments by our management. Changes to these rules or their interpretation or changes in underlying assumptions, estimates or judgments by our management could adversely affect our reported financial results.

**Risks Related to This Offering and Ownership of Our Common Stock**

***We may not be able to satisfy the continued listing requirements of Nasdaq or obtain or maintain a listing of our common stock on Nasdaq.***

We must meet certain financial and liquidity criteria to maintain the listing of our common stock on the Nasdaq Capital Market. If we violate Nasdaq's listing requirements, or if we fail to meet any of Nasdaq's listing standards, our common stock may be delisted. In addition, our board of directors may determine that the cost of maintaining our listing on a national securities exchange outweighs the benefits of such listing. A delisting of our common stock from Nasdaq may materially impair our shareholders' ability to buy and sell our common stock and could have an adverse effect on the market price of, and the efficiency of the trading market for, our common stock. The delisting of our common stock could significantly impair our ability to raise capital and the value of your investment.

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***The recent listing our common stock on Nasdaq has increased our regulatory burden.***

Our common stock was listed on the Nasdaq Capital Market under the symbol "HPCO" on August 30, 2022, and we became subject to the continuous and timely disclosure requirements of Nasdaq's exchange rules, regulations and policies. We are working with our legal, accounting and financial advisors to identify those areas in which changes should be made to our financial management control systems to manage our obligations as a public company listed on Nasdaq. These areas include corporate governance, corporate controls, disclosure controls and procedures and financial reporting and accounting systems. We have made, and will continue to make, changes in these and other areas, including our internal controls over financial reporting. However, we cannot assure holders of our shares that these and other measures that we might take will be sufficient to allow us to satisfy our obligations as a public company listed on Nasdaq on a timely basis and that we will be able to maintain compliance with applicable listing requirements. In addition, compliance with reporting and other requirements applicable to public companies listed on Nasdaq increases our operational costs and requires the time and attention of management. We cannot predict the amount of the additional costs that we will incur as a result of being a publicly traded company, the timing of such costs or the effects that management's attention to these matters will have on our business.

***The market price of our common stock may fluctuate, and you could lose all or part of your investment.***

After this offering, the market price for our common stock is likely to be volatile. The market price of our common stock may fluctuate significantly in response to several factors, most of which we cannot control, including:

• actual or anticipated variations in our periodic operating results;

• increases in market interest rates that lead investors of our common stock to demand a higher investment return;

• changes in earnings estimates;

• changes in market valuations of similar companies;

• actions or announcements by our competitors;

• adverse market reaction to any increased indebtedness we may incur in the future;

• additions or departures of key personnel;

• actions by shareholders;

• speculation in the media, online forums, or investment community; and

• our intentions and ability to list our common stock on Nasdaq and our subsequent ability to maintain such listing.

The public offering price of our common stock has been determined by negotiations between us and the underwriters based upon many factors and may not be indicative of prices that will prevail following the closing of this offering. Volatility in the market price of our common stock may prevent investors from being able to sell their common stock at or above the initial public offering price. As a result, you may suffer a loss on your investment.

***You will experience immediate and substantial dilution as a result of this offering.***

As of September 30, 2022, our net tangible book value was approximately $11,930,656, or approximately $0.51 per share. Since the effective price per share of our common stock being offered in this offering is substantially higher than the net tangible book value per share of our common stock, you will suffer substantial dilution with respect to the net tangible book value of the common stock you purchase in this offering. Based on the estimated public offering price of $1.11 per share of common stock being sold in this offering, and our net tangible book value per share as of September 30, 2022, if you purchase shares of common stock in this offering, you will suffer immediate and substantial dilution of approximately $0.52 per share (or $0.51 per share if the underwriters exercise the over-allotment option in full) with respect to the net tangible book value of the common stock. See the section titled "*Dilution*" for a more detailed discussion of the dilution you will incur if you purchase securities in this offering.

***We have considerable discretion as to the use of the net proceeds from this offering, and we may use these proceeds in ways with which you may not agree.***

We intend to use the proceeds from this offering for sales, marketing and advertising initiatives, acquisitions of companies and technologies aligned and synergistic with our manufacturing technologies and growth objectives, expansion and upgrades to our existing manufacturing facility, research and development, hiring sales and other employees, expenses associated with becoming a public company, and general corporate and working capital purposes. However, we have considerable discretion in the application of the proceeds. Because of the number and variability of factors that will determine our use of our net proceeds from this offering, their ultimate use may vary substantially from their currently intended use. You will not have the opportunity, as part of your investment decision, to assess whether the proceeds are being used appropriately. You must rely on the judgment of our management regarding the application of the net proceeds of this offering. The net proceeds may be used for corporate or other purposes with which you do not agree or that do not improve our profitability or increase our share price. The net proceeds from this offering may also be placed in investments that do not produce income or that lose value. Please see the "*Use of Proceeds*" section below for more information.

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***We do not intend to pay any cash dividends on our shares of common stock in the near future, so our shareholders will not be able to receive a return on their shares unless they sell their shares.***

We intend to retain any future earnings to finance the development and expansion of our business. We do not anticipate paying any cash dividends on our common stock in the foreseeable future. There is no assurance that future dividends will ever be paid, and if dividends are paid, there is no assurance with respect to the amount of any such dividend. Unless we pay dividends, our shareholders will not be able to receive a return on their shares unless they sell their shares, and they may be unable to sell their shares on favorable terms or at all.

***We are majority-owned by Green Globe International, Inc. ("GGII"), and a small group of Company officers and directors hold a majority of the control of GGII.***

As of immediately prior to the commencement of this offering, the Company was a majority-owned subsidiary of GGII with GGII owning approximately 75% of our outstanding shares of common stock. The Company's key officers and directors beneficially owned approximately 30% of GGII's outstanding common stock and a majority of GGII's outstanding preferred stock. By virtue of such stock ownership, those principal GGII shareholders are able to control the election of the members of GGII's Board of Directors. In turn, GGII, by virtue of its majority ownership of the Company, is able to control the election of the members of our Board of Directors. As a result, those principal GGII shareholders can generally exercise control over the affairs of the Company, including the election and removal of members of our board of directors, amending our Articles of Incorporation and Bylaws, and adopting measures that could delay or prevent a change of control.

Such concentration of ownership and control could have the effect of delaying, deterring or preventing a change in control of the Company that might otherwise be beneficial to stockholders. There can be no assurance that conflicts of interest will not arise with respect to our key officers and directors, or that such conflicts will be resolved in a manner favorable to the Company.

***Our executive officers and the majority of our directors are also officers and directors of our majority owner, GGII, and conflicts of interest may arise as a result.***

Because our executive officers and a majority of our directors are also officers and directors of GGII, conflicts of interest between us and GGII may arise, including with respect to how our management evaluates acquisition and other business development opportunities, hiring opportunities, and financing opportunities. There can be no assurance that conflicts of interest will be resolved in a manner favorable to the Company.

***We are a "controlled company" within the meaning of the listing rules of Nasdaq and, as a result, can rely on exemptions from certain corporate governance requirements that provide protection to shareholders of other companies.***

Because GGII owns a majority of our common stock and will own a majority of our common stock after this offering, we are and will continue to be after the offering a "controlled company" as defined under the listing rules of Nasdaq. Under Nasdaq listing rules, controlled companies are companies of which more than 50% of the voting power for the election of directors is held by an individual, a group, or another company. For as long as we remain a controlled company, we are permitted to elect to rely on certain exemptions from Nasdaq's corporate governance rules, including the following:

• an exemption from the rule that a majority of our board of directors must be independent directors;

• an exemption from the rule that our compensation committee be composed entirely of independent directors;

• an exemption from the rule that our director nominees must be selected or recommended solely by independent directors or a nominating committee composed solely of independent directors;

Although we do not intend to rely on the "controlled company" exemptions to Nasdaq's corporate governance rules, we could elect to rely on these exemptions in the future. If we elected to rely on the "controlled company" exemptions, a majority of the members of our board of directors might not be independent directors, our nominating and corporate governance and compensation committees might not consist entirely of independent directors upon closing of the offering, and you would not have the same protection afforded to shareholders of companies that are subject to Nasdaq's corporate governance rules.

***We may need funding from GGII in the future, which may not be available when needed.***

During the nine months ended September 30, 2022, GGII advanced $621,755 in funding to us. We may need additional funding from GGII in the future, which may not be available when needed depending on a number of factors, including GGII's operating plans and results, GGII's business performance, the status and cost of litigation GGII may be involved in, and other factors affecting the financial condition of GGII which we cannot control.

***We have broad discretion in how we use the proceeds of this offering and may not use these proceeds effectively, which could affect our results of operations.***

We will have considerable discretion in the application of the net proceeds of this Offering. We intend to use the net proceeds from this offering for working capital and general corporate purposes. As a result, investors will be relying upon management's judgment with only limited information about our specific intentions for the use of the net proceeds of this Offering. We may use the net proceeds for purposes that do not yield a significant return or any return at all for our shareholders. In addition, pending their use, we may invest the net proceeds from this offering in a manner that does not produce income or that loses value.

***There has been no independent valuation of our stock, which means that our common stock may be worth less than the offering price in the offering.***

The per share purchase price in the offering has been determined by us without independent valuation of our shares of common stock. The public offering price for our common stock has been determined by negotiation between us and the underwriters based upon several factors, including prevailing market conditions, our historical performance, the historical market price of our common stock, estimates of our business potential and earnings prospects, and the market valuations of similar companies. There is no relation to the market value, book value, or any other established criteria. We did not obtain an independent appraisal opinion on the valuation of our shares.

Additionally, the offering price is substantially higher than the prices at which the selling stockholders acquired their shares ($1.00 and $2.00 per share), and we recently sold stock at prices ($1.00 and $2.00 per share) substantially less than the primary offering price. Our recent share issuances at prices substantially less than the primary offering price occurred while we were a non-public company, and the shares we issued were subject to transfer restrictions imposed by the Securities Act of 1933, as amended, and by lock-up restrictions, whereas shares issued in the offering will be issued after we became a public company and will be issued without restriction.

Nevertheless, our shares of common stock may have a value significantly less than the offering price, and the shares may never obtain a value equal to or greater than the offering price.

Additionally, if securities industry analysts do not publish research reports on us, or publish unfavorable reports on us, then the market price and market trading volume of our common stock could be negatively affected.

Any trading market for our common stock may be influenced in part by any research reports that securities industry analysts publish about us. We do not currently have and may never obtain research coverage by securities industry analysts. If no securities industry analysts commence coverage of us, the market price and market trading volume of our common stock could be negatively affected. In the event we are covered by analysts, and one or more of such analysts downgrade our securities, or otherwise reports on us unfavorably, or discontinues coverage of us, the market price and market trading volume of our common stock could be negatively affected.

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***Future issuances of our common stock or securities convertible into, or exercisable or exchangeable for, our common stock, or the expiration of lock-up agreements that restrict the issuance of new common stock or the trading of outstanding common stock, could cause the market price of our common stock to decline and would result in the dilution of your holdings.***

Future issuances of our common stock or securities convertible into, or exercisable or exchangeable for, our common stock, or the expiration of lock-up agreements that restrict the issuance of new common stock or the trading of outstanding common stock, could cause the market price of our common stock to decline. We cannot predict the effect, if any, of future issuances of our securities, or the future expirations of lock-up agreements, on the price of our common stock. In all events, future issuances of our common stock would result in the dilution of your holdings. In addition, the perception that new issuances of our securities could occur, or the perception that locked-up parties will sell their securities when the lock-ups expire, could adversely affect the market price of our common stock. In connection with this offering, we will enter into a lock-up agreement that prevents us, subject to certain exceptions, from offering additional shares of capital stock for up to six months after the closing of this offering, as further described in the section titled "*Underwriting*." In addition to any adverse effects that may arise upon the expiration of these lock-up agreements, the lock-up provisions in these agreements may be waived, at any time and without notice. If the restrictions under the lock-up agreements are waived, our common stock may become available for resale, subject to applicable law, including without notice, which could reduce the market price for our common stock.

***Future issuances of debt securities, which would rank senior to our common stock upon our bankruptcy or liquidation, and future issuances of preferred stock, which could rank senior to our common stock for the purposes of dividends and liquidating distributions, may adversely affect the level of return you may be able to achieve from an investment in our common stock.***

In the future, we may attempt to increase our capital resources by offering debt securities. Upon bankruptcy or liquidation, holders of our debt securities, and lenders with respect to other borrowings we may make, would receive distributions of our available assets prior to any distributions being made to holders of our common stock. Moreover, if we issue preferred stock, the holders of such preferred stock could be entitled to preferences over holders of common stock in respect of the payment of dividends and the payment of liquidating distributions. Because our decision to issue debt or preferred stock in any future offering, or borrow money from lenders, will depend in part on market conditions and other factors beyond our control, we cannot predict or estimate the amount, timing or nature of any such future offerings or borrowings. Holders of our common stock must bear the risk that any future offerings we conduct or borrowings we make may adversely affect the level of return, if any, they may be able to achieve from an investment in our common stock.

***We are authorized to issue "blank check" preferred stock without stockholder approval, which could adversely impact the rights of holders of our common stock.***

Our articles of incorporation authorize us to issue up to 50,000,000 shares of "blank check" preferred stock, meaning our board of directors can designate the rights and preferences of classes or series of such preferred stock without shareholder approval. Any preferred stock that we issue in the future may rank ahead of our common stock in terms of dividend priority or liquidation premiums and may have greater voting rights than our common stock. In addition, such preferred stock may contain provisions allowing those shares to be converted into shares of common stock, which could dilute the value of common stock to current stockholders and could adversely affect the market price, if any, of our common stock. In addition, the preferred stock could be utilized, under certain circumstances, as a method of discouraging, delaying or preventing a change in control of our company. Although we have no present intention to issue any shares of authorized preferred stock, there can be no assurance that we will not do so in the future.

***If our shares of common stock become subject to the penny stock rules, it would become more difficult to trade our shares.***

The Securities and Exchange Commission, or the SEC, has adopted rules that regulate broker-dealer practices in connection with transactions in penny stocks. Penny stocks are generally equity securities with a price of less than $5.00, other than securities registered on certain national securities exchanges or authorized for quotation on certain automated quotation systems, provided that current price and volume information with respect to transactions in such securities is provided by the exchange or system. If we do not retain a listing on Nasdaq or another national securities exchange and if the price of our common stock is less than $5.00, our common stock could be deemed a penny stock. The penny stock rules require a broker-dealer, before a transaction in a penny stock not otherwise exempt from those rules, to deliver a standardized risk disclosure document containing specified information. In addition, the penny stock rules require that before effecting any transaction in a penny stock not otherwise exempt from those rules, a broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive (i) the purchaser's written acknowledgment of the receipt of a risk disclosure statement; (ii) a written agreement to transactions involving penny stocks; and (iii) a signed and dated copy of a written suitability statement. These disclosure requirements may have the effect of reducing the trading activity in the secondary market for our common stock, and therefore shareholders may have difficulty selling their shares.

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**CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS**

This prospectus contains forward-looking statements that are based on our management's beliefs, expectations, and assumptions and on information currently available to us. All statements other than statements of historical facts are forward-looking statements. The forward-looking statements are contained principally in, but not limited to, the sections entitled "*Prospectus Summary*," "*Risk Factors*," "*Management's Discussion and Analysis of Financial Condition and Results of Operations*" and "*Business*." These statements relate to future events or to our future financial performance and involve known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed or implied by these forward-looking statements. Forward-looking statements include, but are not limited to, statements about:

· our goal and strategies;

· our future business development, financial condition and results of operations;

· expected changes in our revenue, costs or expenditures;

· growth of and competition trends in our industry;

· our expectations regarding demand for, and market acceptance of, our products;

· our expectations regarding our relationships with investors, institutional funding partners and other parties with whom we collaborate;

· our expectation regarding the use of proceeds from this offering;

· fluctuations in general economic and business conditions in the markets in which we operate; and

· relevant government policies and regulations relating to our industry.

In some cases, you can identify forward-looking statements by terms such as "may," "could," "will," "should," "would," "expect," "plan," "intend," "anticipate," "believe," "estimate," "predict," "potential," "project" or "continue" or the negative of these terms or other comparable terminology. These statements are only predictions. You should not place undue reliance on forward-looking statements because they involve known and unknown risks, uncertainties and other factors, which are, in some cases, beyond our control and which could materially affect results. Factors that may cause actual results to differ materially from current expectations include, among other things, those listed under the heading "*Risk Factors*" and elsewhere in this prospectus. If one or more of these risks or uncertainties occur, or if our underlying assumptions prove to be incorrect, actual events or results may vary significantly from those implied or projected by the forward-looking statements. No forward-looking statement is a guarantee of future performance.

The forward-looking statements made in this prospectus relate only to events or information as of the date on which the statements are made in this prospectus. Although we will become a public company after this offering and have ongoing disclosure obligations under United States federal securities laws, except as required by applicable law, we do not intend to update or otherwise revise the forward-looking statements in this prospectus, whether as a result of new information, future events or otherwise.

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**USE OF PROCEEDS**

After deducting the estimated underwriters' discounts and commissions and estimated offering expenses payable by us, we expect to receive net proceeds of approximately $4,641,287 from this offering (or approximately $5,365,787 if the underwriters exercise the over-allotment option in full), based on the estimated public offering price of $1.11 per share.

We plan to use the net proceeds of this offering as follows:

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| 25% of the net proceeds (approximately $1,160,322) for sales, marketing and advertising initiatives; |
| 25% of the net proceeds (approximately $1,160,322) for acquisitions of companies and technologies aligned and synergistic with our manufacturing technologies and growth objectives; |
| 15% of the net proceeds (approximately $696,193) for expansion and upgrades to our existing manufacturing facility; |
| 10% of the net proceeds (approximately $464,129) for research and development; |
| 10% of the net proceeds (approximately $464,129) for hiring of a national sales team and general employee staffing; |
| 5% of the net proceeds (approximately $232,064) for legal, accounting, and other professional fees associated with being a public company; |
| 5% of the net proceeds (approximately $232,064) for general and administrative expenses associated with increased operations; and |
| 5% of the net proceeds (approximately $232,064) for general working capital. |

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With regard to our plan to use approximately 25% of the net proceeds of this offering for potential acquisitions, we have been introduced to several potential acquisition targets, but we do not have any current plans, arrangements or agreements in connection with any potential acquisition targets. We do not plan to use any of the net proceeds of this offering to repay amounts owed to our officers and directors.

The foregoing represents our current intentions to use and allocate the net proceeds of this offering based upon our present plans and business conditions. Our management, however, will have broad discretion in the way that we use the net proceeds of this offering. See "*Risk Factors—Risks Related to This Offering and Ownership of Our Common Stock—We have considerable discretion as to the use of the net proceeds from this offering and we may use these proceeds in ways with which you may not agree*."

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**DIVIDEND POLICY**

We have never declared or paid cash dividends on our common stock. We currently intend to retain all available funds and any future earnings for use in the operation of our business and do not anticipate paying any cash dividends on our common stock in the near future. We may also enter into credit agreements or other borrowing arrangements in the future that will restrict our ability to declare or pay cash dividends on our common stock. Any future determination to declare dividends will be made at the discretion of our board of directors and will depend on our financial condition, operating results, capital requirements, contractual restrictions, general business conditions and other factors that our board of directors may deem relevant. See also "*Risk Factors—Risks Related to This Offering and Ownership of Our Common Stock—We do not intend to pay any cash dividends on our shares of common stock in the near future, so our shareholders will not be able to receive a return on their shares unless they sell their shares*."

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**CAPITALIZATION**

The following table sets forth our capitalization as of September 30, 2022:

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| on an actual basis; |
| on a pro forma basis to reflect the sale of 4,729,729 shares by us in this offering at the estimated price to the public of $1.11 per share, resulting in net proceeds to us of $4,641,287 after deducting (i) underwriter commissions and non-accountable expenses of $420,000, and (ii) our estimated other offering expenses of $188,712; and |
| on a pro forma basis to reflect the sale of 5,439,188 shares by us in this offering, assuming the underwriters elect to exercise the over-allotment option in full, at the estimated price to the public of $1.11 per share, resulting in net proceeds to us of $5,365,787 after deducting (i) underwriter commissions and non-accountable expenses of $483,000, and (ii) our estimated other offering expenses of $188,712. |

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The pro forma information below is illustrative only and our capitalization following the completion of this offering is subject to adjustment based on the initial public offering price of our common stock and other terms of this offering determined at pricing. You should read this table together with our financial statements and the related notes included elsewhere in this prospectus and the information under "

Management's Discussion and Analysis of Financial Condition and Results of Operations."

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|  | **As of September 30, 2022:** | **As of September 30, 2022:** | **As of September 30, 2022:** |
|  | **Actual** | **Post-Offering Pro Forma without** <br>**Over-**<br>**Allotment Option** | **Post-Offering Pro Forma with** <br>**Over-**<br>**Allotment Option** |
| Cash and cash equivalents | $2973686 | $7614973 | $8339473 |
| Total long-term liabilities | $444630 | $444630 | $444630 |
| Total liabilities | $2083505 | $2083505 | $2083505 |
| Shareholders' equity: |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Preferred stock, $0.001 par value, 50,000,000 shares authorized and no shares issued and outstanding on an actual and pro forma basis (prior to this offering) | $- | $- | $- |
| &nbsp;&nbsp;&nbsp;&nbsp;Common stock, $0.001 par value, 200,000,000 shares authorized and 23,373,213 shares issued and outstanding on an actual and pro forma basis (prior to this offering)  | $23373 | $28103 | $28812 |
| &nbsp;&nbsp;&nbsp;&nbsp;Additional Paid in Capital | $18054685 | $22691243 | $23415033 |
| &nbsp;&nbsp;&nbsp;&nbsp;Accumulated Deficit | $(5490216) | $(5490216) | $(5490216) |
| Total shareholders' equity  | $12587842 | $17229129 | $17953629 |
| Non-controlling interests | $(7287) | $(7287) | $(7287) |
| Total liabilities and shareholders' equity | $14664060 | $19305347 | $20029847 |

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**DILUTION**

Dilution in net tangible book value per share to new investors in our securities, is the amount by which the offering price paid by the purchasers of the shares of our common stock sold in this offering exceeds the pro forma net tangible book value per share of common stock immediately after this offering. Net tangible book value per share is determined at any date by subtracting our total liabilities from the total book value of our tangible assets and dividing the difference by the number of shares of common stock deemed to be outstanding at that date.

The net tangible book value of our common stock as of September 30, 2022, was approximately $11,930,656, or approximately $0.51 per share.

Pro forma as adjusted net tangible book value dilution per share to new investors represents the difference between the amount per share paid by purchasers of our common stock in this offering and the pro forma as adjusted net tangible book value per share of our common stock immediately after completion of this offering. Investors participating in this offering will incur immediate, substantial dilution. After giving effect to our sale of 4,729,729 shares of our common stock in this offering at the estimated public offering price of $1.11 per share, and after deducting estimated underwriting discounts and commissions and estimated offering expenses, our pro forma as adjusted net tangible book value as of September 30, 2022, would have been approximately $16,571,943, or approximately $0.59 per share. This amount represents an immediate increase in pro forma net tangible book value of $0.08 per share to existing shareholders and an immediate dilution in pro forma net tangible book value of $0.52 per share to purchasers of our common stock in this offering, as illustrated in the following table.

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| Assumed public offering price per share | $1.11 |
| Net tangible book value per share at September 30, 2022 | $0.51 |
| Pro forma net tangible book value per share after this offering | $0.59 |
| Increase in net tangible book value per share to the existing shareholders | $0.08 |
| Dilution in net tangible book value per share to new investors in this offering | $0.52 |

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If the underwriters exercise their over-allotment option in full, the pro forma as adjusted net tangible book value per share of our common stock, as adjusted to give effect to this offering, would be approximately $0.60 per share, and the dilution in pro forma net tangible book value per share to new investors purchasing shares of common stock in this offering would be approximately $0.51 per share.

The following table sets forth, assuming the sale of 4,729,729 shares of our common stock in this offering at the estimated public offering price of $1.11 per share as of September 30, 2022, the total number of shares of common stock previously issued and sold by us to existing investors, the total consideration paid for the foregoing and the average price per share, before deducting underwriter commissions and estimated offering expenses (assuming no exercise of the over-allotment option to purchase additional shares of common stock and assuming no exercise of the Representatives' warrants), in each case payable by us. As the table shows, new investors purchasing shares of our common stock in this offering may in certain circumstances pay an average price per share substantially higher than the average price per share paid by our existing shareholders.

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|:---|:---|:---|:---|:---|:---|
|  | **Shares Purchased** | **Shares Purchased** | **Total Consideration** | **Total Consideration** | |
|  | **Number** | **Percent** | **Amount** | **Percent** | **Average Price**<br>**Per Share** |
| Existing shareholders<sup>(1)</sup> | 23373213 | 83.2% | $20186489 | 79.4% | $0.86 |
| New investors | 4729729 | 16.8% | $5249999 | 20.6% | $1.11 |
| Total | 28102942 | 100.0% | $25436488 | 100.0% | $0.91 |

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&nbsp;&nbsp;&nbsp;&nbsp;

(1) During the nine months ended September 30, 2022, the Company issued shares of common stock as follows: (i) on or about April 7, 2022, the Company sold 208,000 shares of Company common stock at $2.00 per share to 9 investors; (ii) on or about June 10, 2022, the Company issued 56,592 shares of Company common stock to a lender in conversion of $50,000 in principal and $6,592 of accrued interest; (iii) on or about July 15, 2022, the Company issued 2,000,000 shares of Company common stock to Nery's Logistics, Inc. in consideration of the acquisition of two cigarette production equipment lines and multiple trademarks from it; (iv) on or about July 15, 2022, the Company settled two vendor accounts payable balances totaling $100,000 by issuing 50,000 shares of Company common stock (25,000 shares issued to each of the vendors) to the vendors; (v) on or about September 1, 2022, the Company sold 1,000,000 shares of Company common stock in the Company's initial public offering (the "IPO") at a price to the public of $6.00 per share; (vi) on or about September 6, 2022, the Company issued Boustead Securities, LLC ("Boustead"), the Company's underwriter in the IPO, 54,928 shares of Company common stock upon Boustead's exercise of warrants it received as partial compensation for underwriting the IPO; (vii) on September 6, 2022, the Company entered into a settlement agreement with Titan General Agency Ltd. ("Titan"), the Company's creditor equipment financier which was owed $1,432,681 by the Company (the "Titan Debt"), pursuant to which the Company agreed to pay Titan $250,000 in cash and issue Titan 266,667 shares of Company common stock (the "Settlement Shares"), in full satisfaction of the remaining balance, the Company issued Titan the Settlement Shares on or about September 8, 2022, and (viii) on or about October 4, 2022, the Company issued North Equities USA Ltd. ("North") 41,494 shares of Company common stock for six months of marketing services valued at $100,000, to be rendered by North to the Company, commencing on September 19, 2022. During the year ended December 31, 2021, the Company issued shares of common stock as follows: (i) on May 21, 2021, the Company issued 9,917,532 shares for conversion of Series A Preferred Shares into common stock and payment of dividends due thereon, as well as for conversion of outstanding debt, and for payment of past services rendered; and (ii) in December of 2021, the Company sold 1,300,000 shares of common stock at $1.00 per share to 24 investors. During the year ended December 31, 2020, the Company issued shares of common stock as follows: (i) on February 17, 2020, the Company issued 25,000 shares for conversion of debt of $25,000; (ii) on May 17, 2020, the Company issued 25,000 shares to induce a note extension; and (iii) on November 21, 2020, the Company issued 28,000 shares for conversion of debt of $28,000. During the year ended December 31, 2019, the Company issued shares of common stock as follows: (i) on April 1, 2019, the Company issued 8,000,000 of founder shares, and (ii) on November 6, 2019, the Company issued 400,000 of founder shares. On May 21, 2021, all the Company's outstanding shares (18,395,532 shares of common stock) were acquired by Green Globe International, Inc.

The pro forma as adjusted information discussed above is illustrative only. Our net tangible book value following the completion of this offering is subject to adjustment based on the actual net tangible book value per share of our common stock at the time of the offering and the public offering price of our common stock and other terms of this offering determined at pricing.

To the extent that any outstanding options or warrants are exercised, new options, restricted stock units or other securities are issued under our stock-based compensation plans, or new shares of preferred stock are issued, or we issue additional shares of common stock or warrants in the future, there will be further dilution to investors participating in this offering.

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**MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS**

*The following discussion and analysis summarizes the significant factors affecting our operating results, financial condition, liquidity and cash flows of our company as of and for the periods presented below. The following discussion and analysis should be read in conjunction with our financial statements and the related notes thereto included elsewhere in this prospectus. The discussion contains forward-looking statements that are based on the beliefs of management, as well as assumptions made by, and information currently available to, our management. Actual results could differ materially from those discussed in or implied by forward-looking statements as a result of various factors, including those discussed below and elsewhere in this prospectus, particularly in the sections titled "Risk Factors" and "Cautionary Statement Regarding Forward-Looking Statements".*

**Overview**

We are focused on Disrupting Tobacco™ by manufacturing and selling nicotine-free and tobacco-free alternatives to traditional cigarettes. We utilize a proprietary, patented spraying technology for terpene infusion and patent-pending flavored filter infusion technology to manufacture hemp- and herb-based smokable alternatives.

We have conducted research and development in the smokables space and are engaged in the manufacturing and sale of smokable hemp and herb products, including The Real Stuff™ Hemp Smokables. Our operational segments include private label manufacturing and sales, intellectual property licensing, and the development and sales of inhouse brands using patented counter displays. Our inhouse brands are currently sold in over 200 retail locations located in the San Diego, California, area, our private label customers include well-known and established companies in the cannabis and tobacco-alternatives industries, and we currently own approximately 600 kiosk vending machines which we plan to refurbish and use to distribute our products in a wider fashion under our HempBox Vending brand.

Our hemp cigarette production facility, located in San Diego, California, has the capacity to produce up to 30 million cigarettes monthly. From our facility, we can small-to-large quantities of product—from single displays of product to targeted retail locations to truckloads of product to private label customers—with in-house processing, packing, and shipping capabilities.

We believe that our manufacturing technologies will be a critical component of our success. We plan to continue to invest in research and development, and we currently have one approved patent and one patent pending with respect our critical manufacturing processes. Our approved patent is an exclusivity patent to spray hemp with terpenes for flavoring or to add cannabidiol, which we refer to as CBD, or cannabigerol, which we refer to as CBG, and our pending patent relates to our flavored filter infusion technology. We also have several ready-to-file patent applications with respect to hemp manufacturing, hemp processing, design patents for hemp machines and merchandisers, and customized manufacturing equipment.

We believe that we are positioned to rapidly grow our customer and product footprint through increasing marketing efforts, reaching agreements with master distributors who will sell to a broad network of retail establishments, and aggressively targeting additional distributors throughout the United States. We plan to drive and increase customer traffic with internet marketing to or with the clients that carry our products.

**Our Corporate History and Structure**

We were incorporated in the State of Nevada on April 1, 2019, as "The Hempacco Co., Inc.," and on April 23, 2021, changed our name to "Hempacco Co., Inc." As further described below, on May 21, 2021, we were acquired by Green Globe International, Inc., a Delaware corporation, and became a wholly owned subsidiary of it. Subsequently, we issued additional shares of common stock, and as of immediately prior to this offering, we are a majority-owned subsidiary of Green Globe International, Inc., with Green Globe International, Inc. owning approximately 78.7% of our capital stock. Green Globe International, Inc. operates exclusively in the fast-moving consumer goods space, focusing on products such as nutraceuticals and CBD edible gummies, but it does not compete with us, and it does not have operations in the smokables space separate from us.

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In February 2021, we negotiated the acquisition from an unrelated third party of 100 shares of super-voting Series A Preferred Stock (the "Control Block") of Green Globe International, Inc., a Delaware corporation ("Green Globe"), for a purchase price of $50,000, with the understanding that the officers and directors of Green Globe at the time would resign and our officers and directors and nominees would be appointed as the officers and directors of Green Globe upon payment of the $50,000 acquisition purchase price. The Control Block was entitled to approximately 80% of the voting rights of the capital stock of Green Globe, and there were approximately 3,700,640,356 shares of Green Globe common stock outstanding at the time. As of February 2021, Green Globe had not filed any quarterly or annual reports with OTCMarkets.com since May 16, 2019, and we viewed Green Globe as insolvent because, at that time, its liabilities exceeded its assets, it had no current assets and had a working capital deficit, it was not generating revenues, and it was not generating any cash flows from operations, investing activities, or financing activities. Subsequent reports filed by Green Globe with OTCMarkets.com indicated that it was a shell company (i.e., a company with no or nominal non-cash assets and no or nominal operations) at that time. We also determined that upon acquiring control of Green Globe, we would cancel the Control Block and have Green Globe acquire Hempacco in a share exchange transaction by issuing 70,312,160,174 shares of Green Globe common stock in exchange for all outstanding shares of Hempacco, such that (i) Hempacco would become a wholly-owned subsidiary of Green Globe, (ii) Hempacco's shareholders immediately prior to acquiring Hempacco would receive 95% of the common stock of Green Globe (70,312,160,174 shares out of 74,012,800,530 that would be outstanding following the share exchange), and (iii) Green Globe's common shareholders immediately prior to acquiring Hempacco would retain 5% of Green Globe's common stock (3,700,640,356 shares out of 74,012,800,530 shares that would be outstanding following the share exchange). We also determined at the time that we did not want to effect the share exchange with Green Globe until we had resolved as many of our outstanding liabilities as practicable. We did not obtain any fairness opinion or other valuation of either Green Globe or Hempacco at the time, and the 70,312,160,174-share number (the number of shares of Green Globe we determined would be issued to Hempacco's shareholders in the share exchange transaction) was arbitrarily determined by us without reference to any particular valuation or book value.

On or about March 22, 2021, we paid the $50,000 purchase price for the Control Block and acquired it, the officers and directors of Green Globe resigned, and our officers, our sole director at the time, and two other director nominees selected by us were appointed as the officers and directors of Green Globe as follows: (i) our CEO and sole director, Sandro Piancone, was appointed as CEO and director of Green Globe; (ii) Neville Pearson, our Chief Financial Officer, was appointed as the Chief Financial Officer, Secretary and Treasurer of Green Globe; (iii) Jorge Olson, our Chief Marketing Officer, was appointed as the Chief Marketing Officer of Green Globe; and (iv) Jerry Halamuda and Dr. Stuart Titus, who at the time had no positions with us, were appointed as directors of Green Globe at our direction.

As of March 22, 2021, we had outstanding approximately 8,478,000 shares of common stock and 8,000,000 Series A Preferred Shares. Between March 22, 2021, and May 21, 2021, we negotiated with counterparties owed funds by us, including the related parties described below, with the goal of resolving as much of our outstanding obligations as possible prior to effecting the share exchange with Green Globe. We then issued 9,917,532 shares of our common stock, and then closed the share exchange with Green Globe on May 21, 2021, with all 18,395,532 shares of our outstanding common stock transferred to Green Globe in consideration of Green Globe's issuance of an aggregate of 70,312,160,174 shares to our shareholders. The 9,917,532 shares of common stock we issued on May 21, 2021, are described below. Between March 22, 2021, and May 21, 2021, Mr. Piancone was our CEO and sole director, he was the CEO and one of the directors of Green Globe, he was the officer and control person of several of the related party entities described below, and he functionally controlled both us and Green Globe.

On October 22, 2019, we had entered into a Kiosk Acquisition Agreement with Mexico Franchise Opportunity Fund LP ("MFOF") (a related party entity of which approximately 31% is owned by our founder and CEO, Sandro Piancone, and approximately 25% is owned by our founder and CMO, Jorge Olson) to purchase 600 vending kiosks for total consideration of $3,638,357, payable by the issuance of 8,000,000 shares of our Series A Preferred Shares to MFOF. On May 21, 2021, we issued 8,757,479 shares of common stock to MFOF upon conversion of the 8,000,000 shares of Series A Preferred Shares into common stock at $1.00 per share, and payment of 757,479 shares of common stock for accrued dividends of $757,479, due on the preferred shares, at $1.00 per share.

On May 21, 2021, we issued 357,006 shares of common stock to eight third-party lenders shares for conversion of debt owed to the lenders at $1.00 per share, with 336,500 of such shares issued upon conversion of principal of $336,500, and 20,506 of such shares issued upon conversion of accrued interest of $20,506.

On May 21, 2021, we issued 127,016 shares of common stock to Mr. Halamuda (now considered a related party as he was appointed as a member of our Board of Directors in July 2021) for conversion of debt owed to Mr. Halamuda at $1.00 per share, with 125,000 of such shares issued upon conversion of principal of $125,000, and 2,016 of such shares issued upon conversion of accrued interest of $2,016.

On May 21, 2021, we issued 51,030 shares of common stock to a lender (Dr. Stuart Titus, now considered a related party as he was appointed as our Chairman of the Board of Directors in July 2021) for conversion of debt owed to Dr. Titus at $1.00 per share, with 50,000 of such shares issued upon conversion of principal of $50,000, and 1,030 of such shares issued upon conversion of accrued interest of $1,030.

On May 21, 2021, we issued 170,000 shares of common stock to an entity (Strategic Global Partners, Inc.) controlled by our founder and CEO, Mr. Piancone, in satisfaction of $170,000 of accrued fees for management services owed to the entity by us.

On May 21, 2021, we issued 185,000 shares of common stock to an entity (Cube17, Inc.) controlled by our founder and CMO, Mr. Olson, in satisfaction of $185,000 of accrued fees for management services owed to the entity by us.

On May 21, 2021, we issued 170,000 shares of common stock to an entity (Primus Logistics) controlled by our founder and CEO, Mr. Piancone, for rent of our manufacturing and office facility from January 1, 2020, to May 31, 2021, valued at $170,000.

On May 21, 2021, we issued 100,000 shares of common stock to a third party for information technology, software development, and kiosk technical services provided by them to us valued at $100,000.

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**Our Products**

We have launched the production and sale of our own in-house brand of hemp-based cigarettes, The Real Stuff Smokables, in three presentations: the twenty pack, the ten pack, and the Solito™ single pack, all of which are sold in our patented counter displays in convenience stores through master distributors.

We have also entered into several joint ventures to launch multiple smokables brands: Cali Vibes D8, a joint venture focused on Delta 8 smokable products; Hemp Hop Smokables, a joint venture with rapper Rick Ross and Rap Snack's CEO James Lindsay; a joint venture with StickIt Ltd., an Israeli corporation, to manufacture cannabinoid sticks for insertion into other cigarettes; a joint venture to launch Cheech & Chong-branded hemp smokables; Hempacco Paper Co., Inc., a joint venture with Sonora Paper Co., Inc. focused on rolling papers; Organipure, Inc., a joint venture with High Sierra Technologies, Inc. focused on hemp smokables; and HPDG, LLC, a joint venture to launch smokables products with Alfalfa Holdings, LLC.

We have launched a brand of flavored hemp rolling papers, and we also private label manufacture hemp rolling papers for third parties. We are currently manufacturing hemp rolling papers for HBI International, one of the leading smoking paper producers in the world.

*Recent Developments*

In the fall of 2021, we received our largest purchase order to date for approximately $9.2 million from HBI International's Skunk and Juicy brand to manufacture hemp rolling papers for it. This purchase order is non-binding (we are not obligated to produce any product for HBI International under it), and we are currently negotiating a supply and manufacturing agreement with HBI International, the terms of which have not yet been finalized. Our sales to HBI International constituted approximately 41% of our revenues for the year ended December 31, 2021, the balance receivable from HBI International at December 31, 2021, represents approximately 37% of our total accounts receivable balances as of that date, and were we to lose HBI International as a customer, our revenues would significantly decline, and our business would be harmed.

In December 2021, we sold 1,300,000 shares of common stock at $1.00 per share to 24 investors, and in April 2022, we sold 208,000 shares of common stock at $2.00 per share to 9 investors.

On or about March 18, 2022, we borrowed $50,000 from Jerry Halamuda, one of our directors, and issued Mr. Halamuda a $50,000 promissory note, accruing interest at 8% per annum, which originally matured on June 18, 2022, and was extended to mature on September 18, 2022. The note is secured by 50,000 shares of our common stock.

In July 2022, we launched sales of our Hemp Hop Smokables joint venture products, as well as our Cheech & Chong-branded joint venture products.

On or about June 10, 2022, we issued 56,592 shares of common stock to our lender, Mario Taverna, in conversion of $50,000 in principal and $6,592 of accrued interest due to Mr. Taverna under a convertible promissory note.

On July 15, 2022, we settled two vendor accounts payable balances totaling $100,000 by issuing 50,000 shares of common stock to the vendors.

On or about July 15, 2022, we acquired two cigarette equipment and machinery lines, as well as a suite of trademarks described below, aggregate value $4,000,000, from the seller, Nery's Logistics, Inc., in consideration of the issuance of 2,000,000 shares of our common stock to the seller. The trademarks we acquired include multiple smokables product trademarks in Mexico for smokable brands including "Tijuana," "Gladiator," "Anchor," "Black Cat," and "Solitos." The acquired equipment and trademarks will be used in connection with our hemp smokables products and will not be used for tobacco smokables products.

On August 29, 2022, we entered into an underwriting agreement with Boustead Securities, LLC ("Boustead"), in connection with the initial public offering of our common stock (the "IPO"), pursuant to which we agreed to (i) sell 1,000,000 shares of our common stock at a price to the public of $6.00 per share, (ii) issue Boustead warrants to purchase 70,000 shares of common stock, exercisable from September 1, 2022, through August 29, 2027, and initially exercisable at $9.00 per share (the "Boustead Warrants"), and (iii) grant Boustead an option for a period of 45 days to purchase up to an additional 150,000 shares of common stock solely for the purpose of covering over-allotments in the IPO.

On August 30, 2022, our common stock was listed and began trading on the Nasdaq Capital Market, and on September 1, 2022, the IPO closed. At the closing, we (i) issued 1,000,000 shares of common stock for total gross proceeds of $6,000,000, and (ii) issued Boustead the Boustead Warrants. After deducting underwriting commission and expenses, we received net proceeds of $5,484,015 from the IPO. On September 6, 2022, Boustead exercised the Boustead Warrants, which were part of Boustead's compensation as underwriter in the IPO, in full on a cashless basis, pursuant to which, on September 7, 2022, we issued 54,928 shares of common stock to Boustead.

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On September 6, 2022, we entered into a settlement agreement with Titan General Agency Ltd. ("Titan"), our creditor equipment financier which was owed $1,432,681 by us as of September 6, 2022 (the "Titan Debt"), pursuant to our prior purchase of cigarette manufacturing machinery and equipment, pursuant to which we agreed to pay Titan $250,000 in cash (the "Settlement Cash Payment") and issue Titan 266,667 shares of our common stock (the "Settlement Shares"), in full satisfaction of the remaining balance. On or about September 8, 2022, we made the Settlement Payment to Titan and issued Titan the Settlement Shares, extinguishing the Titan Debt.

On October 4, 2022, we issued North Equities USA Ltd. ("North") 41,494 shares of Company common stock as compensation for $100,000 worth of marketing services to be rendered by North to us over a period of six months, commencing on September 19, 2022, and including content management for our YouTube channel, establishment of a brand ambassador, and social media services.

On October 12, 2022, we entered a Broadcasting and Billboard Agreement with FMW Media Works LLC ("FMW") of Hauppauge, New York, for a period of three months. FMW will produce an informative TV show which will discuss the Company and its business, and as compensation, FMW was issued 63,292 shares of Company common stock.

In October 2022, we entered into a joint venture agreement with Sonora Paper Co., Inc., a California corporation ("Sonora"), to form a joint venture entity in Delaware, Hempacco Paper Co., Inc., which will market and sell hemp rolling papers. Pursuant to the agreement, the joint venture entity will be owned 80% by us and 20% by Sonora, we are required to manufacture and package joint venture product and provide accounting, inventory management, staff training, and trade show and marketing services for the joint venture entity, and Sonora is required to provide its patented and patent-pending technologies for the joint venture's use, with the joint venture obligated to pay royalties of $0.0025 per paper cone manufactured by the joint venture entity and provide lodging for Sonora's director, Daniel Kempton.

In November 2022, we entered into a joint venture agreement with High Sierra Technologies, Inc. ("High Sierra"), a Nevada corporation and subsidiary of High Sierra Technologies, Inc., a Colorado corporation, to form a joint venture entity in Nevada, Organipure, Inc., which will market and sell hemp smokables products. Pursuant to the agreement, the joint venture entity will be owned will be owned 50% by each of us and High Sierra, with each of us contributing $1,000 to the joint venture initially, we are required to manufacture joint venture product, High Sierra is required to process raw hemp biomass initially, and each of us is required to provide joint accounting, inventory management, staff training, and trade show and marketing services for the joint venture entity.

In January 2023, we entered into a joint venture agreement with Alfalfa Holdings, LLC ("Alfalfa"), a California limited liability company, to operate a joint venture entity in California, HPDG, LLC (the "Joint Venture"), which will market and sell hemp smokables products. Pursuant to the agreement, the Joint Venture will be owned 50% by each of us and Alfalfa, we are required to fund $10,000 to the Joint Venture, we are required to manufacture Joint Venture product and provide accounting, inventory management, staff training, and trade show and marketing services for the Joint Venture, and Alfalfa is required to provide online marketing and promotion, design and branding, and brand management and development services to the Joint Venture, as well as Snoop Dogg attendance and appearances at Joint Venture events subject to professional availability, and subject to a services agreement between Alfalfa, the Joint Venture, and Spanky's Clothing, Inc., and Calvin Broadus, Jr. p/k/a "Snoop Dogg" (collectively "Talent").

*Impact of the COVID-19 Pandemic*

In December 2019, a novel coronavirus disease ("COVID-19") was reported to have surfaced in Wuhan, China, and on March 11, 2020, the World Health Organization characterized COVID-19 as a pandemic. The pandemic, which has continued to spread, and the related adverse public health developments, including orders to shelter-in-place, travel restrictions, and mandated business closures, have adversely affected workforces, organizations, customers, economies, and financial markets globally, leading to an economic downturn and increased market volatility. It has also disrupted the normal operations of many businesses, including ours.

Our operations have been impacted by a range of external factors related to the pandemic that are not within our control. For example, many cities, counties, states, and even countries have imposed or may impose a wide range of restrictions on the physical movement of our employees, partners, and customers to limit the spread of the pandemic, including physical distancing, travel bans and restrictions, closure of non-essential business, quarantines, work-from-home directives, shelter-in-place orders, and limitations on public gatherings. These measures have caused, and are continuing to cause, business slowdowns or shutdowns in affected areas, both regionally and worldwide. In 2020, we temporarily scaled down sales efforts at trade shows and with customers and potential customers in in-person meetings, and we were forced to source ingredients for some of the components of our products from alternative suppliers. These changes disrupted our business, and similar changes in the future may disrupt the way we operate our business. In addition, our management team has, and will likely continue, to spend significant time, attention and resources monitoring the pandemic and seeking to minimize the risk of the virus and manage its effects on our business.

The duration and extent of the impact from the pandemic depends on future developments that cannot be accurately predicted at this time, such as the severity and transmission rate of the virus, the extent and effectiveness of containment actions and the disruption caused by such actions, the effectiveness of vaccines and other treatments for COVID-19, and the impact of these and other factors on our employees, customers, partners, and vendors. If we are not able to respond to and manage the impact of such events effectively, our business will be harmed.

To the extent the pandemic adversely affects our business and financial results, it may also have the effect of heightening many of the other risks described in the "Risk Factors" section.

**Principal Factors Affecting Our Financial Performance**

Our operating results are primarily affected by the following factors:

● our ability to acquire new customers or retain existing customers;

● our ability to offer competitive product pricing;

● our ability to broaden product offerings;

● industry demand and competition;

● our ability to leverage technology and use and develop efficient manufacturing processes;

● our ability to attract and retain talented employees and sales personnel and distributors; and

● market conditions and our market position.

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**Results of Operations**

***For the Year Ended December 31, 2021, Compared to the Year Ended December 31, 2020***

*Revenue*

During the year ended December 31, 2021, the Company generated $1,187,273 in revenue compared to $345,989 in revenue in 2020. $805,969 of such revenue during 2021 was from sales of our own product brands to third parties, $139,114 was from sales to related parties (entities controlled by Sandro Piancone, as well as the Cali Vibes D8 joint venture), and $242,190 was from product sales to white label clients. $135,867 of such revenue during 2020 was from sales of our own product brands to third parties, $64,290 was from sales to related parties (entities controlled by Sandro Piancone, the Company's CEO, as well as the Cali Vibes D8 joint venture), and $145,832 was from product sales to white label clients. The increase in revenues during 2021, as compared to 2020, was as a result of us launching sales of our products in 2020 and increasing sales efforts during 2021.

*Operating Costs and Expenses*

The Company had total cost of goods sold of $850,901 for the year ended December 31, 2021, compared to $899,699 in cost of goods sold in 2020, which included an inventory obsolescence allowance expense of $623,375 in 2020 incurred in the year ended December 31, 2020, as a result of the creation of a potential loss allowance provision on a quantity of hemp biomass that was acquired shortly after the Company was formed. The inventory obsolescence allowance was created as a precautionary measure with regard to a large quantity of hemp biomass that is currently being used in production of our products, which we expect will be consumed within 6 to 12 months. All or a portion of the allowance is expected to be credited back as other income as the biomass is used, but there is no guarantee that it will be. The other increase in costs of sales in 2021 as compared to 2020 was due to expanding sales efforts in 2021 after launching product sales in 2020.

The Company incurred general and administrative expenses totaling $981,676 for the year ended December 31, 2021, compared to $303,682 in 2020. The increase was due to us expanding operations in 2021 as compared to 2020, and incurring increased expenses associated with raising capital in 2021, including new accounting, legal and broker expenses incurred in 2021. The Company also incurred related party general and administrative expenses of $469,259 during 2021 and $420,000 during 2020, consisting of senior management consulting fees and rent payable on our premises leased in San Diego, California. The landlord, Primus Logistics, is 90%-owned by Sandro Piancone, the Company's CEO.

The Company's sales and marketing expenses increased to $542,680 during the year ended December 31, 2021, compared to sales and marketing expenses of $27,597 during 2020, as a result of us expanding operations during 2021 and increasing sales efforts in 2021 as compared to 2020. While the Company incurred no research and development expenses in 2020, during 2021, the Company incurred research and development expenses of $2,090 associated with laboratory testing of the Company's products.

*Net Loss*

The Company had a net loss of $1,870,675 for the year ended December 31, 2021, compared to a net loss of $1,465,444 for the 2020 fiscal year. This increase was due to increasing sales and expanding operations in 2021 as compared to 2020, and the corresponding increase in general and administrative expenses described above, and an increase in interest expense to $209,676 during the year ended December 31, 2021, compared to interest expense of $160,423 during 2020, resulting from the sale of additional interest-bearing promissory notes to private investors for the purposes of raising seed capital in 2021. Additionally, during May of 2021, the Company paid dividends to its then-holder of preferred stock in shares of common stock rather than cash, which shares were valued at $757,479. As a result, the Company's net loss attributable to the Company's common stockholders during 2021 was $2,613,904, after a reduction of net loss of $14,250 for the Company's non-controlling interests in its joint ventures subsidiaries. The Company had no comparable dividend and had no non-controlling interests net loss reduction during 2020.

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*Assets & Liabilities*

The following table sets forth key components of our balance sheet as of December 31, 2021 and 2020.

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|  | **As of December 31,** | **As of December 31,** |
|  | **2021** | **2020** |
| Current Assets | $2117638 | $101462 |
| Property and Equipment | 4998771 | 5005309 |
| **Total Assets** | 7570523 | 5657894 |
| Current Liabilities | 4168264 | 2931761 |
| **Total Liabilities** | 4702863 | 3435326 |
| **Stockholder's Equity (for Hempacco)** | 2867660 | 2222568 |
| **Total Liabilities and Equity** | $7570523 | $5657894 |

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As of December 31, 2021, current assets increased to $2,117,638 from $101,462 as of December 31, 2020. This increase was primarily due to increase in accounts receivable, deposits and prepayments as of December 31, 2021, as compared to December 31, 2020, and the Company's sales of 1,300,000 shares of common stock to 24 investors during December of 2021 at $1.00 per share, for gross proceeds of $1,300,000. As of December 31, 2021, current liabilities increased to $4,168,264 from $2,931,761 as of December 31, 2020, primarily due to increases in accounts payable and accrued expenses, long-term promissory note payables, prepaid invoices and deferred revenue, partially offset by a decrease in related party accounts payable.

At December 31, 2021, the Company had cash funds of $933,469.

**Liquidity and Capital Resources**

The table below, for the periods indicated, provides selected cash flow information:

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|:---|:---|:---|
|  | **Year Ended December 31,** <br>**2021** | **Year Ended December 31,**<br>**2020** |
| Net cash used in operating activities | $(730961) | (69686) |
| Net cash used in investing activities | (79963) | (51431) |
| Net cash provided by financing activities | 1743893 | 121500 |
| Net change in cash | $932969 | 383 |

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*<u>Cash Flows from Operating Activities</u>*

We had cash used in operating activities of $730,961 in the year ended December 31, 2021, as compared to cash used in operating activities of $69,686 during the year ended December 31, 2020. The increase in cash used in operating activities for the year ended December 31, 2021, is primarily attributable to increases in 2021 in prepaid expenses, accounts receivable and inventory partially offset by increases in deferred revenues, accounts payable and the inventory obsolescence allowance expense (which allowance was incurred in 2020 but not 2021).

*<u>Cash Flows from Investing Activities</u>*

We had cash used in investing activities of $79,963 for the year ended December 31, 2021, as compared to $51,431 in cash used in investing activities in 2021. This cash was used to make improvements to our manufacturing facility and purchase equipment.

*<u>Cash Flows from Financing Activities</u>*

We had cash provided by financing activities of $1,743,893 in the year ended December 31, 2021, as compared to cash provided by financing activities of $121,500 in 2020, due to increased borrowing and sales of equity during 2021 as compared to 2020.

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***For the Three and Nine Months Ended September 30, 2022, Compared to the Three and Nine Months Ended September 30, 2021***

*Revenue*

During the three and nine months ended September 30, 2022, the Company generated $592,235 and $3,438,438, respectively, in revenue, compared to $377,221 and $911,007, respectively, in revenue during the three and nine months ended September 30, 2021. During the three and nine months ended September 30, 2022, $575,295 and $3,415,518, respectively, of our revenue was from product sales to third parties, $16,940 and $22,940, respectively, was from product sales to related parties, $6,653 and $33,248, respectively, was from consulting and manufacturing services, and $6,824 and $8,890, respectively, was from kiosk sales, as compared to $218,166 and $542,728, respectively, in product sales to third parties, $95,517 and $95,517, respectively, in product sales to related parties, and $63,538 and $272,762, respectively, in consulting services during the three and nine months ended September 30, 2021. The increase in revenues during 2022, as compared to 2021, was as a result of us expanding product sales during 2022 as compared to 2021.

*Operating Costs and Expenses*

The Company had total cost of goods sold of $598,627 and $2,795,661, respectively, during the three and nine months ended September 30, 2022, compared to total cost of goods sold of $297,178 and $613,784, respectively, during the three and nine months ended September 30, 2021. The increase in relative total cost of goods sold is primarily due to increasing sales and production in the nine months ended September 30, 2022, as compared to the same period in 2021.

The Company incurred general and administrative expenses of $791,562 and $1,758,561, respectively, during the three and nine months ended September 30, 2022, which included a one-time charge of $437,375 during the prior quarter ended March 31, 2022, for the valuation of warrants of our parent company issued to two joint venture partners as an inducement to enter into joint venture agreements with us, compared to $224,926 and $736,811, respectively, during the three and nine months ended September 30, 2021. The Company also incurred related party general and administrative expenses of $45,000 and $195,000, respectively, during the three and nine months ended September 30, 2022, consisting of senior management consulting fees and rent payable on our premises leased in San Diego, California, compared to related party general and administrative expenses of $193,973 and $403,973, respectively, during the three and nine months ended September 30, 2021, for related party fees and rent. The landlord, Primus Logistics, is 90%-owned by Sandro Piancone, the Company's CEO.

The Company's sales and marketing expenses increased to $200,976 and $685,086, respectively, during the three and nine months ended September 30, 2022, compared to sales and marketing expenses of $60,538 and $96,638, respectively, during the nine months ended September 30, 2021, as a result of us significantly expanding sales and marketing activities during the 2021 and 2022 fiscal years as we expanded our operations.

*Net Loss*

The Company had a net loss of $1,049,473 and $2,024,039, respectively, for the three and nine months ended September 30, 2022, compared to a net loss of $467,303 and $1,196,703 for the three and nine months ended September 30, 2021. The increase in net loss for the nine months ended September 30, 2022, significant additional one-off expenses were incurred in connection with our IPO on September 1, 2022 in addition to significantly increasing our operations during 2021 and into 2022, including the expensing of the $437,375 valuation of warrants issued to joint venture partners during the prior quarter ended March 31, 2022, partially offset by decreasing interest expense to $13,080 during the nine months ended September 30, 2022, compared to interest expense of $206,145 during the comparative period in 2021.

*Assets & Liabilities*

The following table sets forth key components of our balance sheet as of September 30, 2022, and December 31, 2021.

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|:---|:---|:---|
|  | **As of** | **As of** |
|  | **September 30,**<br> **2022** | **December 31,**<br>**2021** |
| Current Assets | $5197591 | $2117638 |
| Property and Equipment | 8439091 | 4998771 |
| **Total Assets** | 14664060 | 7570523 |
| Current Liabilities | 1638875 | 4168264 |
| **Total Liabilities** | 2083505 | 4702863 |
| **Stockholder's Equity (for Hempacco)** | 12580555 | 2867660 |
| **Total Liabilities and Equity** | $14664060 | $7570523 |

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As of September 30, 2022, current assets increased to $5,197,591, from $2,117,638 as of December 31, 2021. This increase was primarily due to the receipt of $5,468,812 being the net proceeds from our IPO. As of September 30, 2022, current liabilities decreased to $1,638,875 from $4,168,264 as of December 31, 2021, primarily due to repayment of our equipment loan of $1,432,681 plus other short-term loans.

At September 30, 2022, the Company had cash funds of $2,973,686.

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**Liquidity and Capital Resources**

The table below, for the periods indicated, provides selected cash flow information:

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|:---|:---|:---|
|  | **Nine Months** <br>**Ended**<br>**September 30,**<br>**2022** | **Nine Months**<br>**Ended**<br>**September 30,**<br>**2021** |
| Net cash used in operating activities | $(3217684) | (966243) |
| Net cash provided by (used in) investing activities | (282007) | (17289) |
| Net cash provided by financing activities | 5539908 | 1027886 |
| Net change in cash | $(2040217) | 44354 |

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*Cash Flows from Operating Activities*

We had cash used in operating activities of $3,217,684 in the nine months ended September 30, 2022, as compared to cash used in operating activities of $966,243 during the nine months ended September 30, 2021. The increase in cash used in operating activities of $2,251,441 for the nine months ended September 30, 2022, is primarily attributable to the increase in net operating loss of $2,024,039 plus decreases in customer deferred revenues of $1,115,266 and an increase of $599,572 attributable to inventories.

*Cash Flows from Investing Activities*

We had cash used in investing activities of $282,007 for the nine months ended September 30, 2022, as compared to cash used in investing activities of $17,289 for the nine months ended September 30, 2021. The increase was primarily due to the purchase of additional plant and equipment of $152,109 and franchise and license fees of $152,609 paid as a requirement of a new product joint venture partially offset by a $40,000 cash receipt from the sale of equipment.in the nine months ended September 30, 2022.

*Cash Flows from Financing Activities*

We had cash provided by financing activities of $5,539,908 in the nine months ended September 30, 2022, as compared to cash provided by financing activities of $1,027,886 in the comparative period in 2021, with this increase primarily due to the receipt of $6,000,000 of gross proceeds from the sale of 1,000,000 shares of common stock in our IPO partially offset by the costs of the offering of $531,188 and a $300,000 cash loan repayment in the nine months ended September 30, 2022, as compared to the nine months ended September 30, 2021.

We anticipate that our cash needs for the next twelve months for working capital and capital expenditures will be approximately $1,500,000. As of September 30, 2022, we had approximately $2,973,686 in cash, and we believe that our current cash and cash flow from operations will be sufficient to meet anticipated cash needs for the next twelve months for working capital and capital expenditures. We will likely also require additional cash resources due to possible changed business conditions or other future developments. We plan to seek to sell additional equity securities to generate additional cash to continue operations. We may also sell debt securities to generate additional cash. The sale of equity securities, or of debt securities that are convertible into our equity, could result in additional dilution to our shareholders. The incurrence of additional indebtedness would result in increased debt service obligations and could result in operating and financing covenants that would restrict our operations and liquidity.

Our ability to obtain additional capital on acceptable terms is subject to a variety of uncertainties, including the following: investors' perception of, and demand for, securities of cigarette and hemp companies; conditions of the U.S. and other capital markets in which we may seek to raise funds; future results of operations, financial condition and cash flow. Therefore, our management cannot assure that financing will be available in amounts or on terms acceptable to us, or if at all. Any failure by us to raise additional funds on terms favorable to us could have a material adverse effect on our liquidity and financial condition.

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**Going Concern**

In the event we are not successful in reaching our sustained revenue targets, we anticipate that depending on market conditions and our plan of operations, we will likely incur continued operating losses. We base this expectation, in part, on the fact that we may not be able to generate enough gross profit to cover our operating expenses. Consequently, despite having sufficient cash resources for the next twelve months, there remains the possibility that we may not continue to operate as a going concern in the long term. As described in our description of risks affecting our business, we are subject to many factors which could detrimentally affect us. Many of these risk factors are outside management's control, including demand for our products, our ability to hire and retain talented and skilled employees and service providers, as well as other factors.

We do not know of any trends, demands, commitments, events or uncertainties that will result in, or that are reasonable likely to result in, our liquidity increasing or decreasing in any material way.

We do not know of any significant changes in expected sources and uses of cash.

We do not have any commitments or arrangements from any person to provide us with any equity capital.

**Off-Balance Sheet Arrangements**

We currently have no off-balance sheet arrangements that have or are reasonably likely to have a current or future material effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources**.** 

**Critical Accounting Policies**

Our financial statements are based on the application of accounting principles generally accepted in the United States ("GAAP"). GAAP requires the use of estimates; assumptions, judgments and subjective interpretations of accounting principles that have an impact on the assets, liabilities, revenue, and expense amounts reported. These estimates can also affect supplemental information contained in our external disclosures including information regarding contingencies, risk and financial condition. We believe our use of estimates and underlying accounting assumptions adhere to GAAP and are consistently and conservatively applied. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances. Actual results may differ materially from these estimates under different assumptions or conditions. We continue to monitor significant estimates made during the preparation of our financial statements.

Our significant accounting policies are summarized in Note 2 to our financial statements. While these significant accounting policies impact our financial condition and results of operations, we view certain of these policies as critical. Policies determined to be critical are those policies that have the most significant impact on our financial statements and require management to use a greater degree of judgment and estimates. Actual results may differ from those estimates. Our management believes that given current facts and circumstances, it is unlikely that applying any other reasonable judgments or estimate methodologies would cause an effect on our results of operations, financial position or liquidity for the periods presented in this report.

**Recent Accounting Pronouncements**

In December 2019, the Financial Accounting Standards Board (FASB) issued Accounting Standard Update No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (ASU 2019-12), which simplifies the accounting for income taxes. This guidance will be effective for entities for the fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020 on a prospective basis, with early adoption permitted. We adopted the new standard effective January 1, 2021 and do not expect the adoption of this guidance to have a material impact on our financial statements.

In August 2020, the FASB issued ASU 2020-06, ASC Subtopic 470-20 "Debt—Debt with "Conversion and Other Options" and ASC subtopic 815-40 "Hedging—Contracts in Entity's Own Equity". The standard reduced the number of accounting models for convertible debt instruments and convertible preferred stock. Convertible instruments that continue to be subject to separation models are (1) those with embedded conversion features that are not clearly and closely related to the host contract, that meet the definition of a derivative, and that do not qualify for a scope exception from derivative accounting; and, (2) convertible debt instruments issued with substantial premiums for which the premiums are recorded as paid-in capital. The amendments in this update are effective for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. The Company adopted this standard effective January 1, 2021.

The Company has reviewed all other recently issued, but not yet effective, accounting pronouncements and does not believe the future adoption of any such pronouncements may be expected to cause a material impact on our financial statements.

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**BUSINESS**

**Overview**

We are focused on Disrupting Tobacco™ by manufacturing and selling nicotine-free and tobacco-free alternatives to traditional cigarettes. We utilize a proprietary, patented spraying technology for terpene infusion and patent-pending flavored filter infusion technology to manufacture hemp- and herb-based smokable alternatives.

We have conducted research and development in the smokables space and are engaged in the manufacturing and sale of smokable hemp and herb products, including The Real Stuff™ Hemp Smokables. Our operational segments include private label manufacturing and sales, intellectual property licensing, and the development and sales of inhouse brands using patented counter displays. Our inhouse brands are currently sold in over 200 retail locations located in the San Diego, California, area, our private label customers include well-known and established companies in the cannabis and tobacco-alternatives industries, and we currently own approximately 600 kiosk vending machines which we plan to refurbish and use to distribute our smokables products in a wider fashion under our HempBox Vending brand.

Our hemp cigarette production facility, located in San Diego, California, has the capacity to produce up to 30 million cigarettes monthly. From our facility, we can small-to-large quantities of product—from single displays of product to targeted retail locations to truckloads of product to private label customers—with in-house processing, packing, and shipping capabilities.

We believe that our manufacturing technologies will be a critical component of our success. We plan to continue to invest in research and development, and we currently have one approved patent and one patent pending with respect our critical manufacturing processes. Our approved patent is an exclusivity patent to spray hemp with terpenes for flavoring or to add cannabidiol, which we refer to as CBD, or cannabigerol, which we refer to as CBG, and our pending patent relates to our flavored filter infusion technology. We also have several ready-to-file patent applications with respect to hemp manufacturing, hemp processing, design patents for hemp machines and merchandisers, and customized manufacturing equipment.

We believe that we are positioned to rapidly grow our customer and product footprint through increasing marketing efforts, reaching agreements with master distributors who will sell to a broad network of retail establishments, and aggressively targeting additional distributors throughout the United States. We plan to drive and increase customer traffic with internet marketing to or with the clients that carry our products.

**Our Products**

We have launched the production and sale of our own in-house brand of hemp-based cigarettes, The Real Stuff™ Smokables, in three presentations: the twenty pack, the ten pack, and the Solito™ single pack, all of which are sold in our patented counter displays in convenience stores through master distributors.

We have launched a brand of flavored hemp rolling papers, and we also private label manufacture hemp rolling papers for third parties. We are currently manufacturing hemp rolling papers for HBI International, one of the leading smoking paper producers in the world.

We have launched a brand of flavored hemp rolling papers, and we also private label manufacture hemp rolling papers for third parties. We are currently manufacturing hemp rolling papers for HBI International, one of the leading smoking paper producers in the world, and in the fall of 2021, we received our largest purchase order to date for approximately $9.2 million from HBI International's Skunk and Juicy brand to manufacture hemp rolling papers for it. This purchase order establishes initial product pricing but is non-binding with respect to us since we are not obligated to produce any product for HBI International under it. We are currently negotiating a supply and manufacturing agreement with HBI International, the terms of which have not yet been finalized.

We have also entered into several joint ventures, described below, to launch multiple smokables brands: Cali Vibes D8, a joint venture focused on Delta 8 smokable products; Hemp Hop Smokables, a joint venture with rapper Rick Ross and Rap Snack's CEO James Lindsay; a joint venture with StickIt Ltd., an Israeli corporation, to manufacture cannabinoid sticks for insertion into other cigarettes; a joint venture to launch Cheech & Chong-branded hemp smokables; Hempacco Paper Co., Inc., a joint venture with Sonora Paper Co., Inc. focused on rolling papers; Organipure, Inc., a joint venture with High Sierra Technologies, Inc. focused on hemp smokables; and HPDG, LLC, a joint venture to launch smokables products with Alfalfa Holdings, LLC.

We have a 50% interest in the Hemp Hop Smokables joint venture entity, Hemp Hop Smokables, LLC, a Florida manager-managed limited liability company, which is managed by five managing directors: three managing directors appointed by us, and two managing directors appointed by Hemp Hop Global, LLC, a Florida limited liability company controlled by James Lindsay. Currently, the three managing directors appointed by us are Sandro Piancone, Jorge Olson, and Louis Pelliccia, and the two managing directors appointed by Hemp Hop Global are James Lindsay and Taylor McCain. The written consent of 75% of the managing directors is required for the joint venture entity to take any of the following actions, among others: amending the operating agreement governing the joint venture entity, issuing additional membership interests of the joint venture entity, entering into related party transactions, acquiring or disposing of any joint venture entity assets other than in the ordinary course of business, settling any lawsuit or assuming any liability in excess $10,000, changing the number of managing directors of the joint venture entity, changing the business of the joint venture entity, or dissolving the joint venture entity. We launched sales of our Hemp Hop Smokables joint venture products in May 2022.

We have a 25% profit interest, and a 50% contribution interest in the Cali Vibes D8 joint venture entity, Cali Vibes D8 LLC, a Delaware member-managed limited liability company, which is operated by Louis Pelliccia, the Chairman and CEO of the entity. The joint venture entity shall operate until all members unanimously vote to dissolve the Company, no further members of the entity exist, it becomes unlawful for the entity to operate, a judicial decree is entered to dissolve the entity, or any other event occurs which results in dissolution of the entity under federal or Delaware law.

In January 2022, we entered into a joint venture agreement with StickIt Ltd. ("StickIt"), an Israeli corporation that manufactures cannabinoid sticks which we had previously negotiated a short-form joint venture letter agreement with in 2021, to develop and sell hemp smokables products in the United States and Mexico utilizing each of the parties' respective expertise. Pursuant to the 2022 joint venture agreement, which supersedes the prior letter agreement, we are required to fund $750,000 to the joint venture entity, Stick-It USA, Inc., a newly formed Delaware corporation, and we will then receive preferred shares of the joint venture entity entitling us to 75% of distributable profits of the joint venture entity until we have been repaid $750,000, after which our preferred shares will convert into 750,000 shares of common stock of the joint venture entity. StickIt will also receive 750,000 shares of common stock of the joint venture entity. We are required to manufacture joint venture product and provide accounting, inventory management, staff training, and trade show and marketing services for the joint venture entity; our majority shareholder, Green Globe International, Inc. ("Green Globe"), is required to issue Stick-It five-year warrants to purchase 100,000,000 shares of Green Globe common stock at an exercise price of $0.01 per share, with the warrants issuable in three tranches (the first 25,000,000 warrants issuable upon signing the joint venture agreement, the second 25,000,000 warrants issuable when the joint venture entity achieves annual sales revenue in excess of $5,000,000, and the third tranche of 50,000,000 warrants issuable upon the joint venture entity achieving annual sales revenue in excess of $10,000,000); and StickIt is required to license its trade name and "CBD stick" intellectual property to the joint venture entity, provide distribution and retailer negotiation and management services to the joint venture entity, and supply the joint venture entity with basic (non-CBD) sticks at an initial price of $0.22/stick. The joint venture entity is also required to enter into a manufacturing and supply agreement with StickIt pursuant to which the joint venture entity shall pay StickIt $250,000, and StickIt shall provide the joint venture entity the equipment necessary to manufacture CBD stick products and materials to permit the joint venture entity to manufacture an initial 30,000 stick products. If StickIt's ownership of the joint venture entity ever falls below 50%, the joint venture entity is required to a name change amendment with the State of Delaware to remove "stick" from its name unless StickIt otherwise consents to the joint venture entity retaining "stick" in its name. In the event that there is dispute between us and StickIt which cannot be resolved within 28 days of the date the issue was required to be resolved by the joint venture entity's board of directors or shareholders, StickIt shall have the right to purchase our interest in the joint venture entity for a purchase price equal to the average of the joint venture entity's valuation as determined by two appraisers, with one appraiser appointed by us and the other appraiser appointed by StickIt.

In January 2022, we entered into a joint venture agreement with Cheech and Chong's Cannabis Company, a Nevada corporation ("CCCC"), to form a joint venture entity in Nevada, which will market and sell Cheech & Chong-branded hemp smokable products. Pursuant to the agreement, the joint venture entity will be owned 50% by each of us and CCCC, we are required to fund $10,000 to the joint venture entity, we are required to manufacture joint venture product and provide accounting, inventory management, staff training, and trade show and marketing services for the joint venture entity, our majority shareholder, Green Globe, is required to issue to CCCC a three-year warrant to purchase 100,000,000 shares of Green Globe common stock at an exercise price of $0.01 per share, and CCCC is required to provide online marketing and promotion, design and branding, brand management and development, trademark receipt, and sales and distribution services to the joint venture entity. CCCC is also required to ensure that Cheech Marin and Tommy Chong attend and make appearances at joint venture entity events. At the Tobacco Plus Expo held in Las Vegas in January 2022, we debuted the Cheech & Chong-branded joint venture hemp smokables and hemp blunt wraps products, as well as a Cheech & Chong-branded kiosk vending machine, with Tommy Chong. In July 2022, we launched sales of our Cheech & Chong-branded joint venture products.

In October 2022, we entered into a joint venture agreement with Sonora Paper Co., Inc., a California corporation ("Sonora"), to form a joint venture entity in Delaware, Hempacco Paper Co., Inc., which will market and sell hemp rolling papers. Pursuant to the agreement, the joint venture entity will be owned 80% by us and 20% by Sonora, we are required to manufacture and package joint venture product and provide accounting, inventory management, staff training, and trade show and marketing services for the joint venture entity, and Sonora is required to provide its patented and patent-pending technologies for the joint venture's use, with the joint venture obligated to pay royalties of $0.0025 per paper cone manufactured by the joint venture entity and provide lodging for Sonora's director, Daniel Kempton.

In November 2022, we entered into a joint venture agreement with High Sierra Technologies, Inc. ("High Sierra"), a Nevada corporation and subsidiary of High Sierra Technologies, Inc., a Colorado corporation, to form a joint venture entity in Nevada, Organipure, Inc., which will market and sell hemp smokables products. Pursuant to the agreement, the joint venture entity will be owned will be owned 50% by each of us and High Sierra, with each of us contributing $1,000 to the joint venture initially, we are required to manufacture joint venture product, High Sierra is required to process raw hemp biomass initially, and each of us is required to provide joint accounting, inventory management, staff training, and trade show and marketing services for the joint venture entity.

In January 2023, we entered into a joint venture agreement with Alfalfa Holdings, LLC ("Alfalfa"), a California limited liability company, to operate a joint venture entity in California, HPDG, LLC (the "Joint Venture"), which will market and sell hemp smokables products. Pursuant to the agreement, the Joint Venture will be owned 50% by each of us and Alfalfa, we are required to fund $10,000 to the Joint Venture, we are required to manufacture Joint Venture product and provide accounting, inventory management, staff training, and trade show and marketing services for the Joint Venture, and Alfalfa is required to provide online marketing and promotion, design and branding, and brand management and development services to the Joint Venture, as well as Snoop Dogg attendance and appearances at Joint Venture events subject to professional availability, and subject to a services agreement between Alfalfa, the Joint Venture, and Spanky's Clothing, Inc., and Calvin Broadus, Jr. p/k/a "Snoop Dogg" (collectively "Talent"). Pursuant to the services agreement, Talent will endorse the Joint venture's smokable hemp products and serve as a spokesperson for the products in the United States, and the Joint Venture shall (i) pay Talent's legal expenses of $7,500 in connection with entering into the Joint Venture agreement and services agreement; (ii) cause the Company to issue to Talent a fully vested warrant to acquire 450,000 shares of Company common stock at a strike price of $1.00 per share (the "Talent Warrants"); (iii) cause the Company to issue to Talent's designee a fully vested warrant to acquire 50,000 shares of Company common stock at a strike price of $1.00 per share (the "Talent Designee Warrants"); and (iv) pay Talent royalties of 10% of Joint Venture gross revenue, with minimum annual royalty payments of $450,000 by the end of the first two years of the initial term of the services agreement, an additional $600,000 by the end of the third year of the initial term, and an additional $1,200,000 by the end of the fourth year of the initial term. On or about January 30, 2023, the Company issued the Talent Warrants and Talent Designee Warrants as required by the services agreement between the Joint Venture, Alfalfa, and Talent.

Our products include the following:

![hemp_s1img4.jpg](hemp_s1img4.jpg)

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**Industry**

Smokable hemp products, which include CBD flower, hemp-CBD pre-rolls, cigars and other inhalables, are part of a growing sector in the hemp-CBD market. According to *Hemp Industry Daily - Sector Snapshot - Smokable Hemp*, Hemp industry observers say smokable hemp is one of the fastest growing and most lucrative segments in the nascent hemp and CBD industry, with expectations that the market will experience fivefold growth in the next five years.

By 2025, Nielsen expects the smokable hemp market to reach $300 million to $400 million in size, representing roughly 5% of the potential $6 billion to $7 billion hemp-derived CBD consumer products category. (see https://hempindustrydaily.com/exclusive-smokable-hemp-market-worth-up-to-80-million-for-2020-with-five-fold-growth-predicted/).

Demand for hemp-derived CBD products continues to grow, even though market projections have fluctuated based on economic factors, including disruptions caused by the COVID-19 pandemic and the lack of conclusive legislation from federal authorities with respect to consumable CBD products.

**Competitive Strengths**

We believe our manufacturing technologies, manufacturing facility manufacturing capacity, and management with extensive industry experience are strengths that set us apart from our competitors. Our manufacturing facility can quickly scale up production volumes, our management team has extensive experience in the cigarette and food and beverage industries, and because of our manufacturing technologies, which allow us to spray hemp with terpenes for flavoring or to add CBD or CBG, and add flavoring via our filter infusion technology, we believe our smokables products offer consistent and unique flavor and odor profiles to consumers, which we believe sets our products apart from competing products, which may lack flavor and odor consistency or smell like marijuana when smoked.

**Growth Strategy**

Our goal is to become the market leader in disrupting the trillion-dollar tobacco industry with nicotine- and tobacco-free products and technologies in connection with hemp, herb, and spice smokables and smoking papers. We believe that our products and technology have the potential to disrupt the Big Tobacco industry.

We seek to become the leader in sales and distribution of alternative smokable products. We aim to offer our products and affiliate products in over 100,000 convenience and liquor stores in the United States (see https://www.convenience.org/Research/FactSheets/IndustryStoreCount), and we also intend to build international sales and distribution channels for our products and affiliate products. Our goal is to build a portfolio of non-tobacco smokables brands, become the United States market leader in the space, and subsequently build exclusive master distribution relationships in other countries.

We plan to do this in four ways:

1. We intend to focus on growing our fast-moving consumer goods brands, such as our The Real Stuff™ smokables and Hempbar, our line of liquor-flavored infused hemp smokables for sale in liquor stores and bars.

In the smokables space, we plan to make strategic acquisitions of brands to add to our portfolio of brands and products. We currently have interests in joint ventures that have launched two new brands. We exclusively manufacture the products for these joint ventures, and we plan to act as a master distributor for the different joint venture brands that we manufacture products for.

2. We plan to build a portfolio of patents and technologies, which should allow us to protect and grow our competitive position in the industry.

We may also license some of our technologies to other cannabis companies in the United States and hemp and cannabis companies in other countries outside the United States. We plan to file several applications for additional patents during the next year as available funds permit, and we plan to evaluate opportunities to license and/or acquire new patents and technologies that are synergistic with our current and planned product offerings and manufacturing plans.

3. We intend to expand our manufacturing capabilities.

We believe that our inhouse manufacturing is a key capability that will separate us from other hemp-based or tobacco-alternative smokable brands. We are not beholden to a third-party manufacturer. We also can produce our products anytime it is necessary, including at night and on weekends. Because of our technologies, we believe that we can expand private label manufacturing for other companies and manufacture their products. We plan to charge them for use of our patented technology, along with manufacturing costs. We plan to continue to assess new potential technologies for acquisition or development, and we intend to continue to design our own new manufacturing technologies to update our production capabilities and employ leading edge manufacturing technologies. In the future, we will look to acquire machines, factories, and technologies to expand our manufacturing and packaging capabilities.

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4. We plan to increase sales by focusing on master distributor relationships, e-commerce sales, and distribution of our brands, and joint venture brands.

Our sales team and brokers plan to market our entire portfolio of brands and affiliated brands to distributors, sell our products aggressively on e-commerce platforms, and sell our products in kiosks.

We believe that we are positioned to rapidly grow our customer and product footprint through increasing our marketing efforts, reaching agreements with master distributors, and aggressively targeting additional distributors throughout the United States. We plan to drive and increase e-commerce customer traffic and sales through aggressive internet marketing campaigns. It is our goal that master distributors and other distributors will sell and deliver to bars, liquor stores, convenience stores, smoke shops and CBD stores.

**Technology & Intellectual Property**

We currently have one approved patent and one patent pending with respect our critical manufacturing processes. Our approved patent is an exclusivity patent to spray hemp with terpenes for flavoring or to add cannabidiol, which we refer to as CBD, or cannabigerol, which we refer to as CBG, and our pending patent relates to our flavored filter infusion technology. We also have several ready-to-file patent applications with respect to hemp manufacturing, hemp processing, design patents for hemp machines and merchandisers, and customized manufacturing equipment.

With regard to our patent, trademarked and referred to as "FlorSure," it has been licensed from Open Book Extracts for three years, and the patent expires in October of 2034 (U.S. patent no. 9532593B2, title: "Herbal Smoking Blend"). Pursuant to the license agreement, our parent company, Green Globe International, Inc., was obligated to issue $120,000 of its common stock to the licensor as an initial royalty payment, it has done so, and we are obligated to make cash royalty payments to the licensor in an amount equal to the greater of either (i)$0.01/cigarette sold which was produced using FlorSure, or(ii)a minimum royalty amount equal to(a) $0 for the first year of the license (April 1, 2021–March 31, 2022), (b) $90,000 for the second year of the license (April 1, 2022–March 31, 2023), and (c) $120,000 for the third year of the license(April 1, 2023–March 31, 2024). Such cash royalty payments are due on a quarterly basis, and the licensor can terminate the license if the royalty payments are not made within a 30-day cure period after providing us notice of intent to terminate for non-payment. For other material breaches of the license by us, the licensor can terminate the license after the provision of 90 days' notice to us, provided we have not cured the breach during such 90-day cure period. We have the right to terminate the license after the provision of 90 days' notice to the licensor if the licensed intellectual property rights are rendered invalid or unenforceable and the licensor has not remediated and made valid the licensed rights within the 90-day cure period. The license expires on March 31, 2024, and may be renewed or extended by mutual agreement of the parties.

FlorSure applies terpenes and cannabinoids onto smokable hemp to enable a consistent customer experience for hemp cigarettes, pre-rolls, and hemp flowers. FlorSure addresses one of the issues in the hemp cigarette market—consistency. Producers of tobacco cigarettes have developed specific tobacco blends to ensure consistency in flavor and effect across millions of batches. FlorSure applies terpenes and cannabinoids to hemp, enabling the consistency in flavor profiles and physiological effects consumers seek. With FlorSure, we believe our brands now have the ability to create finished products with consistent, repeatable, and reliable terpenoid profiles, delivering products that consumers can trust and which we believe sets our products apart from competing products.

With respect to our pending patent, the application for which was filed in 2021, we developed and filed a patent for a new, cutting-edge technology to infuse terpenes and aroma into the cigarette filter. We believe this technology will also provide greater consistency in flavor profiles for our products.

The above-described technologies include systems and methods for infusing cigarettes with sensory additives. Sensory additives described herein enhance the organoleptic properties, such as taste and odor, of the cigarette, and include, for example, flavoring and aromatic additives. A cigarette typically includes a piece of rolling paper, a smoking substance (e.g., an herbal or plant composition), and a filter. The rolling paper encloses the smoking substance forming a cylindrical rod, which is coupled to a filter to form a cigarette.

The filter is at an end of the cigarette that is placed in a smoker's mouth. Systems and methods described herein include infusing cigarette filters with sensory additives to enhance their organoleptic properties.

We have applied for trademarks for "Disrupting Tobacco," "HempBox," "Hempbar," "The Real Stuff," "Solito," and "Cali Vibes D8," and we recently acquired multiple smokables product trademarks in Mexico for smokable brands including "Tijuana," "Gladiator," "Anchor," "Black Cat," and "Solitos."

**Supplier and Fulfillment Relationships**

We obtain our hemp directly from farmers in California and Oregon. In 2022, we plan to increase our number of hemp suppliers to support expanding sales of our hemp-based products. We source other components and ingredients for our products from suppliers throughout the United States and abroad, and we are not dependent on any single supplier.

**Marketing**

We market our products through various sales channels, primarily trade shows and through print and digital advertisements, focusing on several customer types. These customers include consumers, wholesalers, distributors, and those seeking private label products. We repeatedly test new marketing venues, platforms and approaches utilizing proven methods to measure results assuring our efforts are cost effective.

*Trade Shows*

We exhibit at a variety of trade shows each year with differing attendee focuses. These include hemp, cannabis, CBD and wellness, convenience and grocery stores, consumer product distribution, and private label.

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*Digital and Printed Advertisements*

We utilize sophisticated digital tools to place ads primarily through Google and Facebook (now Meta) that target likely customers and those showing interest in our products. In addition, we have recently begun to place traditional print ads in journals and magazines focused on convenience stores, distributors, and private label products.

In addition to new prospect acquisition programs, our marketing team produces a weekly newsletter that is distributed to our contacts with the goal of keeping the Company top-of-mind, and this newsletter has historically resulted in conversion of contacts into current customers.

**Customers and Markets**

We primarily sell our products in the United States, but we have completed a few test orders to customers in Spain, Switzerland, Poland, and Italy. On our e-commerce sites, we have thousands of customers. As for our white/private label business, we have approximately 12 customers who use us to manufacture white/private label products for them. As to our Real Stuff™ brand, we plan to sign up master distributors and smaller distributors to carry brand products and increase sales of brand products. We currently sell our products to over 200 liquor and smoke shops in the San Diego, California area.

**Competition**

The smokables industry consists of a few domestic and international tobacco and cigarette companies, most of which have existing relationships in the markets into which we plan to sell, as well as financial, technical, marketing, sales, manufacturing, scaling capacity, distribution and other resources, and name recognition substantially greater than ours. Several domestic cigarette competitors are continuing to research hemp cigarettes.

Cigarette and filtered cigar companies compete primarily on the basis of product quality, brand recognition, brand loyalty, taste, innovation, packaging, service, marketing, advertising, retail shelf space, and price. Hemp cigarette sales can be significantly influenced by weak economic conditions, erosion of consumer confidence, competitors' introduction of low-price products or innovative products, higher taxes, higher absolute prices and larger gaps between price categories, and product regulation that diminishes the ability to differentiate hemp products.

Domestic hemp cigarette competitors included Taat International, Wild Hemp, Pure Hemp, Colorado's Finest, and Redwood Reserve. International hemp cigarette competitors include Heimat and Hemp House.

**Facilities**

We are headquartered in San Diego, California, at the location of our hemp cigarette and rolling paper manufacturing facility, which location is leased from a related party (an entity controlled by our CEO and Director, Sandro Piancone). Our management team, client service team, marketing, operations, and sales team are all primarily based in this location.

Our manufacturing facility at this location has the capacity to produce up to 30 million cigarettes monthly. Our facility is approximately 5,000 square feet in size, and we have the right to lease up to approximately 48,000 additional square feet of co-located manufacturing and warehouse space from the related party as inventory and production needs expand. From our facility, we can ship small-to-large quantities of product—from single displays of product to targeted retail locations to truckloads of product to private label customers—with in-house processing, packing, and shipping capabilities.

**Seasonality and Cyclicality**

Although historically our product sales have not been seasonal or cyclical to any significant degree, we expect that our sales in the future will be greater in the summer months, when more consumers are outdoors, than in the winter months.

**Employees**

As of December 31, 2022, we had 13 full-time and part-time employees, and we consider our employee relations to be good. Our human capital resource objectives are designed to attract, and retain, highly motivated and well qualified employees. We have worked diligently to provide a flexible and safe work environment—especially during the unforeseen COVID-19 global pandemic. The health and safety of our employees and clientele is of the upmost importance to us. We have taken significant steps to protect our workforce during COVID-19 including but not limited to, working remotely, increased cleaning and sanitization of facilities, and social distancing protocols consistent with guidelines issued by federal, state, and local governments.

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**Legal Proceedings**

From time to time, we may become involved in various lawsuits and legal proceedings which arise in the ordinary course of business. However, litigation is subject to inherent uncertainties, and an adverse result in these or other matters may arise from time to time that may harm our business. We are not aware of any such legal proceedings or claims against us except as follows:

On or about October 7, 2022, the Company accepted service in a suit filed in the United States District Court for the Southern District of New York by Long Side Ventures LLC, R & T Sports Marketing Inc., Sierra Trading Corp., Taconic Group LLC, KBW Holdings LLC, Robert Huebsch and Ann E. Huebsch, Joseph Camberato, Joseph Crook, Sachin Jamdar, Michael Matilsky, Gerard Scollan, and Daisy Arnold (collectively "Plaintiffs") against Hempacco Co., Inc., Mexico Franchise Opportunity Fund, LP, Sandro Piancone, Jorge Olson, Neville Pearson, Stuart Titus, Jerry Halamuda, Retail Automated Concepts, Inc. f/k/a Vidbox Mexico Inc., and Vidbox Mexico S.A. De C.V. (collectively "Defendants") (Case No. 1:22-cv-08152 (ALC)), alleging that (i) Plaintiffs previously received a judgment (the "Judgment") in a New York state court action (the "State Action") against Retail Automated Concepts, Inc. ("RAC") and Vidbox Mexico S.A. De C.V. ("Vidbox Mexico"), for breach of promissory notes issued by RAC to Defendants in 2018 and guaranteed by Vidbox Mexico, and (ii) prior to the filing of the State Action, Defendants fraudulently transferred and commingled assets, specifically 600 retail kiosks, in order to avoid enforcement of the Judgment, with Plaintiffs seeking monetary damages from Defendants. On or about November 29, 2022, the court granted Defendants' request to file a motion to dismiss the suit, and on December 30, 2022, Defendants filed the motion to dismiss the suit for failure to state a claim and lack of personal jurisdiction. Defendants believe the suit is without merit and intend to defend the matter vigorously.

**Regulation**

***Trade Regulations***

Our suppliers generally source or manufacture finished goods in parts of the world that may be affected by the imposition of duties, tariffs or other import regulations by the United States. We believe that our redundant network of suppliers provide sufficient capacity to mitigate any dependency risks on a single supplier.

We buy necessary components or ingredients for our products from suppliers or factories both domestically and internationally as needed. We do not depend on any single supplier. However, if we are unable to continue to obtain our finished products from international locations or if our suppliers are unable to source raw materials, it could significantly disrupt our business. Further, we are affected by economic, political and other conditions in the United States and internationally, including those resulting in the imposition or increase of import duties, tariffs and other import regulations and widespread health emergencies, which could have a material adverse effect on our business.

***Laws and Regulations Relating to Our Products***

The production, distribution and sale in the United States of many of our products are subject to the Federal Food, Drug, and Cosmetic Act, the Federal Trade Commission Act, the Lanham Act, state consumer protection laws, competition laws, federal, state and local workplace health and safety laws, various federal, state and local environmental protection laws, various other federal, state and local statutes applicable to the production, transportation, sale, safety, advertising, labeling and ingredients of such products, and rules and regulations adopted pursuant to these laws. Outside the United States, the distribution and sale of our many products and related operations are also subject to numerous similar and other statutes and regulations.

On December 20, 2018, the Agricultural Improvement Act of 2018, which is also known as the "2018 Farm Bill," was enacted and, among other things, further legalized hemp under U.S. federal law, but with compliance still being required with all applicable state hemp laws. The 2018 Farm Bill includes certain benefits for the hemp industry in the United States, including: (i) the extension of the protections for hemp research and researchers and the conditions in which hemp research can be done, (ii) the protection of hemp farmers and hemp production under federal crop insurance programs, (iii) the permitting of the cultivation, interstate transportation and sale of hemp and hemp products in the U.S. in compliance with all other applicable federal and state laws, and (iv) the removal of hemp and hemp derived products from Schedule 1 of the Controlled Substances Act ("CSA").

As of January 1, 2021, federal law and the laws of 47 states in the United States and the District of Columbia have legalized hemp, 36 states in the United States, the District of Columbia, Guam, Puerto Rico, and the U.S. Virgin Islands have enacted laws and/or regulations that recognize, in one form or another, legitimate medical uses for cannabis/marijuana and consumer use of cannabis/marijuana in connection with medical treatment, and 15 states in the United States, the District of Columbia, Guam, and the Northern Mariana Islands have legalized cannabis/marijuana for adult recreational use. Other states are considering similar legislation. Conversely, under the federal CSA, the policies and regulations of the federal government and its agencies are that cannabis/marijuana has no medical benefit, and a range of activities are prohibited, including cultivation, possession, personal use and interstate distribution of cannabis/marijuana.

Our activities in the United States only involve legal hemp in compliance with the CSA. The hemp and the marijuana plants are both part of the same *cannabis* genus, except that hemp does not have more than 0.3% dry weight content of delta-9-tetrahydrocannabinol ("THC"). While 2018 Farm Bill legalized hemp and cannabinoids extracted from hemp in the United States, such extracts remain subject to state laws and regulation by other U.S. federal agencies such as the FDA, U.S. Drug Enforcement Administration ("DEA"), and the U.S. Department of Agriculture ("USDA"). The same plant, with a higher THC content is marijuana, which is legal under certain state laws, but which is currently not legal under U.S. federal law. The similarities between these plants can cause confusion.

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A California law known as Proposition 65 requires a specific warning to appear on any product containing a component listed by the state as having been found to cause cancer or birth defects. The state maintains lists of these substances and periodically adds other substances to these lists. Proposition 65 exposes all food and beverage producers to the possibility of having to provide warnings on their products in California because it does not provide for any generally applicable quantitative threshold below which the presence of a listed substance is exempt from the warning requirement. Consequently, the detection of even a trace amount of a listed substance can subject an affected product to the requirement of a warning label. However, Proposition 65 does not require a warning if the manufacturer of a product can demonstrate that the use of that product exposes consumers to a daily quantity of a listed substance that is:

● below a "safe harbor" threshold that may be established;

● naturally occurring;

● the result of necessary cooking; or

● subject to another applicable exemption.

In January 2019, New York State's governor announced the "Consumer Right to Know Act," a proposed law that would impose similar and potentially more stringent labeling requirements than California Proposition 65. The law has not yet been adopted, and to our knowledge California Proposition 65 remains the most onerous state-level chemical exposure labeling statutory scheme. However, due in part to the large size of California's market, promotional products sold or distributed anywhere in the United States may be subject to California Proposition 65.

We are unable to predict whether a component found in a product that we assisted a client in producing might be added to the California list in the future. Furthermore, we are also unable to predict when or whether the increasing sensitivity of detection methodology may become applicable under this law and related regulations as they currently exist, or as they may be amended.

We are subject to various federal, state and local laws and regulations, including but not limited to, laws and regulations relating to labor and employment, U.S. customs and consumer product safety, including the Consumer Product Safety Improvement Act, or the "CPSIA." The CPSIA created more stringent safety requirements related to lead and phthalates content in children's products. The CPSIA regulates the future manufacture of these items and existing inventories and may cause us to incur losses if we offer for sale or sell any non-compliant items. Failure to comply with the various regulations applicable to us may result in damage to our reputation, civil and criminal liability, fines and penalties and increased cost of regulatory compliance. These current and any future laws and regulations could harm our business, results of operations and financial condition.

Legal requirements apply in various jurisdictions in the United States and overseas requiring deposits or certain taxes or fees be charged for the sale, marketing and use of certain non-refillable beverage containers. The precise requirements imposed by these measures vary. Other types of beverage container-related deposit, recycling, tax and/or product stewardship statutes and regulations also apply in various jurisdictions in the United States and overseas. We anticipate additional, similar legal requirements may be proposed or enacted in the future at local, state and federal levels, both in the United States and elsewhere.

New legislation or regulation, the application of laws from jurisdictions whose laws do not currently apply to our business, or the application of existing laws and regulations to the Internet and e-commerce generally could result in significant additional taxes on our business. Further, we could be subject to fines or other payments for any past failures to comply with these requirements. The continued growth and demand for e-commerce is likely to result in more laws and regulations that impose additional compliance burdens on e-commerce companies.

***Laws and Regulations Relating to Data Privacy***

In the ordinary course of our business, we might collect and store in our internal and external data centers, cloud services and networks sensitive data, including our proprietary business information and that of our customers, suppliers and business collaborators, as well as personal information of our customers and employees. The secure processing, maintenance and transmission of this information is critical to our operations and business strategy. The number and sophistication of attempted attacks and intrusions that companies have experienced from third parties has increased over the past few years. Despite our security measures, it is impossible for us to eliminate this risk.

A number of U.S. states have enacted data privacy and security laws and regulations that govern the collection, use, disclosure, transfer, storage, disposal, and protection of personal information, such as social security numbers, financial information and other sensitive personal information. For example, all 50 states and several U.S. territories now have data breach laws that require timely notification to affected individuals, and at times regulators, credit reporting agencies and other bodies, if a company has experienced the unauthorized access or acquisition of certain personal information. Other state laws, particularly the California Consumer Privacy Act, as amended ("CCPA"), among other things, contain disclosure obligations for businesses that collect personal information about residents in their state and affords those individuals new rights relating to their personal information that may affect our ability to collect and/or use personal information. The Virginia Consumer Data Protection Act ("CDPA") also establishes rights for Virginia consumers to control how companies use individuals' personal data. The CDPA dictates how companies must protect personal data in their possession and respond to consumers exercising their rights, as prescribed by the law, regarding such personal data. The CDPA will go into effect on January 1, 2023. Meanwhile, several other states and the federal government have considered or are considering privacy laws like the CCPA. We will continue to monitor and assess the impact of these laws, which may impose substantial penalties for violations, impose significant costs for investigations and compliance, allow private class-action litigation and carry significant potential liability for our business.

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Outside of the U.S., data protection laws, including the EU General Data Protection Regulation (the "GDPR"), also might apply to some of our operations or business collaborators. Legal requirements in these countries relating to the collection, storage, processing and transfer of personal data/information continue to evolve. The GDPR imposes, among other things, data protection requirements that include strict obligations and restrictions on the ability to collect, analyze and transfer EU personal data/information, a requirement for prompt notice of data breaches to data subjects and supervisory authorities in certain circumstances, and possible substantial fines for any violations (including possible fines for certain violations of up to the greater of 20 million Euros or 4% of total company revenue). Other governmental authorities around the world have enacted or are considering similar types of legislative and regulatory proposals concerning data protection.

The interpretation and enforcement of the laws and regulations described above are uncertain and subject to change, and may require substantial costs to monitor and implement and maintain adequate compliance programs. Failure to comply with U.S. and international data protection laws and regulations could result in government enforcement actions (which could include substantial civil and/or criminal penalties), private litigation and/or adverse publicity and could negatively affect our operating results and business.

***Environmental Regulations***

We use certain plastic, glass, fabric, metal and other products in our business which may be harmful if released into the environment. In view of the nature of our business, compliance with federal, state, and local laws regulating the discharge of materials into the environment, or otherwise relating to the protection of the environment, has had no material effect upon our operations or earnings, and we do not expect it to have a material impact in the foreseeable future.

***Tax Laws and Regulations***

Changes in tax laws or regulations in the jurisdictions in which we do business, including the United States, or changes in how the tax laws are interpreted, could further impact our effective tax rate, further restrict our ability to repatriate undistributed offshore earnings, or impose new restrictions, costs or prohibitions on our current practices and reduce our net income and adversely affect our cash flows.

We are also subject to tax audits in the United States and other jurisdictions and our tax positions may be challenged by tax authorities. Although we believe that our current tax provisions are reasonable and appropriate, there can be no assurance that these items will be settled for the amounts accrued, that additional tax exposures will not be identified in the future or that additional tax reserves will not be necessary for any such exposures. Any increase in the amount of taxation incurred as a result of challenges to our tax filing positions could result in a material adverse effect on our business, results of operations and financial condition.

***Other Regulations***

We are subject to international, federal, national, regional, state, local and other laws and regulations affecting our business, including those promulgated under the Occupational Safety and Health Act, the Consumer Product Safety Act, the Flammable Fabrics Act, the Textile Fiber Product Identification Act, the rules and regulations of the Consumer Products Safety Commission, the Food, Drug, and Cosmetic Act, the Foreign Corrupt Practices Act of 1977 (FCPA), various securities laws and regulations including but not limited to the Securities Exchange Act of 1934, the Securities Exchange Act of 1933, and the Nasdaq Stock Market LLC Rules, various labor, workplace and related laws, and environmental laws and regulations. Failure to comply with such laws and regulations may expose us to potential liability and have an adverse effect on our results of operations.

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**MANAGEMENT**

**Directors and Executive Officers**

Set forth below is information regarding our directors and executive officers as of the date of this prospectus.

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| **Name** | **Age** | **Position** |
| Sandro Piancone | 54 | Chief Executive Officer, President, Treasurer, Secretary, and Director |
| Neville Pearson | 78 | Chief Financial Officer |
| Jorge Olson | 51 | Chief Marketing Officer, Executive Vice President & Director |
| Dr. Stuart Titus | 66 | Chairman of the Board  |
| Jerry Halamuda | 72 | Independent Director |
| Miki Stephens | 49 | Independent Director |

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**Sandro Piancone** co-founded our Company and has served as our President and Chief Executive Officer, Treasurer, Secretary, and Director since inception. Mr. Piancone has served as the Chief Executive Officer of Primus Logistics, a cold storage company since January 2018. He has also served as the Chief Executive Officer of UST Mexico, Inc, a Mexican tobacco company since November 2013. From January 2011 to December 2017, Mr. Piancone served as the Managing Director of Nery's Logistics, Inc, a foodservice and food distributor company in Mexico. From January 2012 to December 2019, he worked as the Chief Executive Officer of Mexico Sales Made Easy-Self Promotion Platform, a marketing company. Mr. Piancone has also been the President, Chief Executive Officer and member of the Board of Directors of Green Globe International, Inc., our majority owner, since March 22, 2021. Mr. Piancone has a track record of building distribution companies with manufacturing, sales, and distribution success. We believe that Mr. Piancone's extensive experience in the cigarette manufacturing, food and beverage industries makes him a valuable member of our Board of Directors.

**Jorge Olson** co-founded our Company and has served as Chief Marketing Officer since inception. Mr. Olson has helped to develop and/or market over 1,000 consumer goods products in the USA and Mexico. He has marketed consumer goods by creating innovative, off-the-shelf display programs that are strategically placed in convenience stores. Mr. Olson has worked with Sandro Piancone for over fifteen years and is the author of *Wholesale MBA* and *Build Your Beverage Empire*. Since 2003, Mr. Olson has been the President of Cube17, Inc., his marketing consulting company. Mr. Olson has also been the Chief Marketing Officer of Green Globe International, Inc., our majority owner, since March 22, 2021. We believe that Mr. Olson's vast consumer goods and beverage experience makes him a valuable member of our Board of Directors.

**Neville Pearson**, who served as our Interim Chief Financial Officer from March 1, 2021-August 31, 2021, was appointed our Chief Financial Officer as of September 1, 2021, and brings extensive and direct experience with financial reporting, management accounting, preparation of SEC filings, and corporate governance and company secretarial functions. As Chief Accountant of the UK Construction Division for John Mowlem & Co. PLC, Mr. Pearson was responsible for over 400 active building and civil engineering projects which include the NatWest Bank Tower in the City financial district, and the Docklands Airport in East London. Mr. Pearson has also been the Chief Financial Officer of Green Globe International, Inc., our majority owner, since March 22, 2021, and he was recently appointed a director of Green Globe International, Inc. in September of 2022. He has been the Chief Financial Officer of ASC Biosciences, Inc. since September 2013, and he was the Interim CFO of American Hemp Ventures, Inc. from December 2018 to May 2020.

**Dr. Stuart Titus** is an expert in hemp and cannabinoids with experience in investing and managing publicly traded companies. He left his position as CEO of Medical Marijuana, Inc., and joined our board in July 2021. Dr. Titus built his financial expertise on Wall Street, where he worked as a bond trader for 11 years, managing a trading and underwriting department as a V.P. for Credit Suisse First Boston Corp. From March 2015 through June of 2021, Dr. Titus was the CEO and a member of the Board of Directors of Medical Marijuana, Inc., and from June 2021 to the present, Dr. Titus has been a consultant with Seaside Sales & Marketing, a sales and marketing consulting company focused on the nutritional supplement industry. Dr. Titus has also been a member of the Board of Directors of Green Globe International, Inc., our majority owner, since March 22, 2021. We believe that Dr. Titus's extensive experience in the cannabis industry makes him a valuable member of our Board of Directors.

**Jerry Halamuda** has started over 20 businesses in the last 50 years; one grew to have approximately $300 million in sales. He is a business operator with agricultural, M&A and investment experience. He founded Color Spot Nurseries Inc. in 1983 and served as its Chief Executive Officer and President through 2016 when he retired for health reasons. He has been the CEO of King Horticulture Supply LLC, a gardening and hydroponics supply company, since December 2019. He has been a Director of EZ Shipper Racks, Inc., since September 2018, and he joined our board in July 2021. Mr. Halamuda has also been a member of the Board of Directors of Green Globe International, Inc., our majority owner, since March 22, 2021. We believe that Mr. Halamuda's hands-on management experience in connection with agricultural product sales companies makes him a valuable member of our Board of Directors.

**Miki Stephens, MBA,** who joined our board on August 29, 2022, is a talented executive and entrepreneur distinguished by her demonstrated success in mergers and acquisitions. Strategy-driven discipline in highly complex and regulated industries provides Ms. Stephens with a well-established background capable of driving material business advantage. From 2017-2020, Ms. Stephens served as Co-founder and COO of Harmony Hemp. Ms. Stephens' operations and financial experience played a key role in the 2020 acquisition of Harmony Hemp by Abacus Health and succession strategies for the company. Ms. Stephens was then the Director of B2B Supply Planning for Charlotte's Web from 2020 to 2022, and is currently focused on further developing her family office through real estate and market investing. Her ability to turn a vision into reality comes from a deep understanding of business capabilities within an organization. Miki brings a deep knowledge of corporate governance from years of working with publicly traded companies.

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**Family Relationships**

There are no family relationships among any of our officers or directors.

**Involvement in Certain Legal Proceedings**

To the best of our knowledge, except as described below, none of our directors or executive officers has, during the past ten years:

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| been convicted in a criminal proceeding or been subject to a pending criminal proceeding (excluding traffic violations and other minor offences); |
| had any bankruptcy petition filed by or against the business or property of the person, or of any partnership, corporation or business association of which he was a general partner or executive officer, either at the time of the bankruptcy filing or within two years prior to that time; |
| been subject to any order, judgment, or decree, not subsequently reversed, suspended or vacated, of any court of competent jurisdiction or federal or state authority, permanently or temporarily enjoining, barring, suspending or otherwise limiting, his involvement in any type of business, securities, futures, commodities, investment, banking, savings and loan, or insurance activities, or to be associated with persons engaged in any such activity; |
| been found by a court of competent jurisdiction in a civil action or by the Securities and Exchange Commission or the Commodity Futures Trading Commission to have violated a federal or state securities or commodities law, and the judgment has not been reversed, suspended, or vacated; |
| been the subject of, or a party to, any federal or state judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated (not including any settlement of a civil proceeding among private litigants), relating to an alleged violation of any federal or state securities or commodities law or regulation, any law or regulation respecting financial institutions or insurance companies including, but not limited to, a temporary or permanent injunction, order of disgorgement or restitution, civil money penalty or temporary or permanent cease-and-desist order, or removal or prohibition order, or any law or regulation prohibiting mail or wire fraud or fraud in connection with any business entity; or |
| been the subject of, or a party to, any sanction or order, not subsequently reversed, suspended or vacated, of any self-regulatory organization (as defined in Section 3(a)(26) of the Exchange Act (15 U.S.C. 78c(a)(26))), any registered entity (as defined in Section 1(a)(29) of the Commodity Exchange Act (7 U.S.C. 1(a)(29))), or any equivalent exchange, association, entity or organization that has disciplinary authority over its members or persons associated with a member. |

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**Corporate Governance**

***Governance Structure***

We chose to appoint a separate Chairman of the Board who is not our Chief Executive Officer. Our board of directors has made this decision based on their belief that an independent Chairman of the Board can act as a balance to the Chief Executive Officer, who also serves as a non-independent director.

***The Board's Role in Risk Oversight***

The board of directors oversees that the assets of our company are properly safeguarded, that the appropriate financial and other controls are maintained, and that our business is conducted wisely and in compliance with applicable laws and regulations and proper governance. Included in these responsibilities is the board's oversight of the various risks facing our company. In this regard, our board seeks to understand and oversee critical business risks. Our board does not view risk in isolation. Risks are considered in virtually every business decision and as part of our business strategy. Our board recognizes that it is neither possible nor prudent to eliminate all risk. Indeed, purposeful and appropriate risk-taking is essential for our company to be competitive on a global basis and to achieve its objectives.

While the board oversees risk management, company management is charged with managing risk. Management communicates routinely with the board and individual directors on the significant risks identified and how they are being managed. Directors are free to, and indeed often do, communicate directly with senior management.

Our board administers its risk oversight function as a whole by making risk oversight a matter of collective consideration. Much of this work has been delegated to committees, which will meet regularly and report back to the full board. The audit committee oversees risks related to our financial statements, the financial reporting process, accounting and legal matters, the compensation committee evaluates the risks and rewards associated with our compensation philosophy and programs, and the nominating and corporate governance committee evaluates risk associated with management decisions and strategic direction.

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***Independent Directors***

Nasdaq's rules generally require that a majority of an issuer's board of directors must consist of independent directors. Our board of directors currently consists of five (5) directors, Mr. Piancone, Mr. Olson, Dr. Titus, Mr. Halamuda, and Ms. Stephens, with Dr. Titus, Mr. Halamuda and Ms. Stephens considered independent within the meaning of Nasdaq's rules.

***Committees of the Board of Directors***

Our board has established an audit committee, a compensation committee, and a nominating and corporate governance committee, each with its own charter approved by the board. The committee charters have been filed as exhibits to the registration statement of which this prospectus is a part. Upon completion of this offering, we intend to make each committee's charter available on our website at https://hempaccoinc.com/.

In addition, our board of directors may, from time to time, designate one or more additional committees, which shall have the duties and powers granted to it by our board of directors.

*<u>Audit Committee</u>*

Ms. Stephens, Dr. Titus, and Mr. Halamuda, each of whom satisfies the "independence" requirements of Rule 10A-3 under the Exchange Act and Nasdaq's rules, serve on our audit committee, with Mr. Halamuda serving as the chairperson. Our board has determined that Mr. Halamuda qualifies as an "audit committee financial expert." The audit committee oversees our accounting and financial reporting processes and the audits of the financial statements of our company.

The audit committee is responsible for, among other things: (i) retaining and overseeing our independent accountants; (ii) assisting the board in its oversight of the integrity of our financial statements, the qualifications, independence and performance of our independent auditors and our compliance with legal and regulatory requirements; (iii) reviewing and approving the plan and scope of the internal and external audit; (iv) pre-approving any audit and non-audit services provided by our independent auditors; (v) approving the fees to be paid to our independent auditors; (vi) reviewing with our chief executive officer and principal financial officer and independent auditors the adequacy and effectiveness of our internal controls; (vii) reviewing hedging transactions; and (viii) reviewing and assessing annually the audit committee's performance and the adequacy of its charter.

*<u>Compensation Committee</u>*

Ms. Stephens, Dr. Titus, and Mr. Halamuda, each of whom satisfies the "independence" requirements of Rule 10C-1 under the Exchange Act and Nasdaq's rules, serve on our compensation committee, with Dr. Titus serving as the chairperson. The members of the compensation committee are also "outside directors" as defined in Section 162(m) of the Internal Revenue Code of 1986, as amended, or the Code, and "non-employee directors" within the meaning of Section 16 of the Exchange Act. The compensation committee assists the board in reviewing and approving the compensation structure, including all forms of compensation, relating to our directors and executive officers.

The compensation committee is responsible for, among other things: (i) reviewing and approving the remuneration of our executive officers; (ii) making recommendations to the board regarding the compensation of our independent directors; (iii) making recommendations to the board regarding equity-based and incentive compensation plans, policies and programs; and (iv) reviewing and assessing annually the compensation committee's performance and the adequacy of its charter.

*<u>Nominating and Corporate Governance Committee</u>*

Ms. Stephens, Dr. Titus, and Mr. Halamuda, each of whom satisfies the "independence" requirements of Nasdaq's rules, serve on our nominating and corporate governance committee, with Ms. Stephens serving as the chairperson. The nominating and corporate governance committee assists the board of directors in selecting individuals qualified to become our directors and in determining the composition of the board and its committees.

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The nominating and corporate governance committee is responsible for, among other things: (i) identifying and evaluating individuals qualified to become members of the board by reviewing nominees for election to the board submitted by shareholders and recommending to the board director nominees for each annual meeting of shareholders and for election to fill any vacancies on the board; (ii) advising the board with respect to board organization, desired qualifications of board members, the membership, function, operation, structure and composition of committees (including any committee authority to delegate to subcommittees), and self-evaluation and policies; (iii) advising on matters relating to corporate governance and monitoring developments in the law and practice of corporate governance; (iv) overseeing compliance with the our code of ethics; and (v) approving any related party transactions.

The nominating and corporate governance committee's methods for identifying candidates for election to our board of directors (other than those proposed by our shareholders, as discussed below) will include the solicitation of ideas for possible candidates from a number of sources - members of our board of directors, our executives, individuals personally known to the members of our board of directors, and other research. The nominating and corporate governance committee may also, from time-to-time, retain one or more third-party search firms to identify suitable candidates.

In making director recommendations, the nominating and corporate governance committee may consider some or all of the following factors: (i) the candidate's judgment, skill, experience with other organizations of comparable purpose, complexity and size, and subject to similar legal restrictions and oversight; (ii) the interplay of the candidate's experience with the experience of other board members; (iii) the extent to which the candidate would be a desirable addition to the board and any committee thereof; (iv) whether or not the person has any relationships that might impair his or her independence; and (v) the candidate's ability to contribute to the effective management of our company, taking into account the needs of our company and such factors as the individual's experience, perspective, skills and knowledge of the industry in which we operate.

A shareholder may nominate one or more persons for election as a director at an annual meeting of shareholders if the shareholder complies with the notice and information provisions contained in our bylaws. Such notice must be in writing to our Company not later than the close of business on the ninetieth (90th) day nor earlier than the close of business on the one-hundred-twentieth (120th) day prior to the first anniversary of the preceding year's annual meeting; provided, however, that in the event that the date of the annual meeting is advanced more than thirty (30) days prior to or delayed by more than thirty (30) days after the anniversary of the preceding year's annual meeting, notice by the stockholder to be timely must be so delivered not earlier than the close of business on the one hundred twentieth (120th) day prior to such annual meeting and not later than the close of business on the later of the ninetieth (90th) day prior to such annual meeting or the tenth (10th) day following the day on which public announcement of the date of such meeting is first made or as otherwise required by the Exchange Act. In addition, shareholders furnishing such notice must be a holder of record on both (i) the date of delivering such notice and (ii) the record date for the determination of shareholders entitled to vote at such meeting.

**Code of Ethics**

We have adopted a code of ethics that applies to all of our directors, officers and employees, including our principal executive officer, principal financial officer and principal accounting officer. Such code of ethics addresses, among other things, honesty and ethical conduct, conflicts of interest, compliance with laws, regulations and policies, including disclosure requirements under the federal securities laws, and reporting of violations of the code.

A copy of the code of ethics has been filed as an exhibit to the registration statement of which this prospectus is a part. We are required to disclose any amendment to, or waiver from, a provision of our code of ethics applicable to our principal executive officer, principal financial officer, principal accounting officer, controller, or persons performing similar functions. We intend to use our website as a method of disseminating this disclosure as well as by SEC filings, as permitted or required by applicable SEC rules. Any such disclosure will be posted to our website within four (4) business days following the date of any such amendment to, or waiver from, a provision of our code of ethics.

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**EXECUTIVE COMPENSATION**

*The following discussion and analysis of compensation arrangements should be read together with the compensation tables and related disclosures that follow. This discussion contains forward-looking statements that are based on our current plans and expectations regarding future compensation programs. Actual compensation programs that we adopt may differ materially from the programs summarized in this discussion. The following discussion may also contain statements regarding corporate performance targets and goals. These targets and goals are disclosed in the limited context of our compensation programs and should not be understood to be statements of management's expectations or estimates of results or other guidance. We specifically caution investors not to apply these statements to other contexts.*

**Summary Compensation Table – Years Ended December 31, 2022 and 2021**

The following table sets forth information concerning all cash and non-cash compensation awarded to, earned by or paid to the named persons for services rendered in all capacities during the noted periods. No other executive officers received total annual salary and bonus compensation in excess of $100,000.

**Summary Compensation Table** 

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|  |  | |  | | **Stock** | **Option** | **All Other** | |
|  | **Fiscal** | **Salary** |  | **Bonus** | **Awards** | **Awards** | **Compensation** | **Total** |
| **Name and Principal Position** | **Year** | **(1)** |  | **(2)** | **(3)** | **(4)** | **(5)** | **($)**  |
| Sandro Piancone | 2022 | $120000 | (6) | $&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; - | $- | $- | $- | $120000 |
| Chief Executive Officer, President, Treasurer & Secretary | 2021 | $300000  | (6) | $- | $- | $- | $- | $300000 |
| Neville Pearson | 2022 | $60000 |  | $- | $- | $- | $- | $60000 |
| Chief Financial Officer (7) | 2021 | $50000 |  | $- | $- | $- | $- | $50000 |
| Jorge Olson | 2022 | $120000  | (8) | $- | $- | $- | $- | $120000 |
| Chief Marketing Officer & Executive Vice President | 2021 | $120000  | (8) | $- | $- | $- | $- | $120000 |

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__________

(1) The dollar value of salary (cash and non-cash) earned. 

(2) The dollar value of bonus (cash and non-cash) earned.

(3) The value of the shares of common stock issued as compensation for services computed in accordance with ASC 718 on the date of grant.

(4) The value of all stock options computed in accordance with ASC 718 on the date of grant.

(5) All other compensation received that could not be properly reported in any other column of the table. 

(6) Mr. Piancone's entity, Strategic Global Partners, Inc., accrued $120,000 in consulting fees during each of the years ended December 31, 2021 and 2020, and it was issued 170,000 shares of Company common stock in satisfaction of the $170,000 accrued balance on May 21, 2021. The remaining balance of $70,000 was paid in cash. Mr. Piancone's entity, UST Mexico, Inc., accrued $180,000 in consulting fees during the years ended December 31, 2021 and 2020, and its accrued balance that had not been paid in cash was $24,600 as of December 31, 2021, and $26,600 as of December 31, 2020. On January 20, 2022, we entered into an employment agreement with Mr. Piancone, which replaced our prior consulting agreement with Mr. Piancone's entity, and pursuant to which Mr. Piancone was paid a salary of $120,000 in 2022.

(7) Mr. Pearson served as our Interim Chief Financial Officer from March 1, 2021 to August 31, 2021, when he was appointed our Chief Financial Officer. On January 20, 2022, we entered into an employment agreement with Mr. Pearson pursuant to which Mr. Pearson was paid a salary of $60,000 in 2022.

(8) Mr. Olson's entity, Cube17, Inc., accrued $15,000 in consulting fees during year ended December 31, 2019, and $120,000 during each of the years ended December 31, 2021 and 2020, and it was issued 185,000 shares of Company common stock in satisfaction of the $185,000 accrued balance on May 21, 2021. The remaining balance of $70,000 was paid in cash. On February 3, 2022, we entered into an employment agreement with Mr. Olson, which replaced our prior consulting agreement with Mr. Olson's entity, and pursuant to which Mr. Olson was paid a salary of $120,000 in 2022.

Employment Agreements

We have not entered into employment or similar agreements with any of our executive officers or directors except as follows:

We entered into a consulting agreement with Cube17, Inc., an entity controlled by our founder and officer, Jorge Olson, on or about November 6, 2019, pursuant to which the entity would provide management, sales and marketing services to us in consideration of the issuance of 400,000 shares of our common stock, cash fees in the amount of $10,000/month, and sales commissions as follows: (i) 5% for direct sales, (ii) 2.5% for sales through an intermediate broker, (iii) 5% for other retail sales (without an intermediate broker), (iv) 5% for sales as a result of online or website leads generated by Cube17, Inc., (v) 10% for direct retail online sales of Company brands (such as The Real Stuff™), and (vi) 5% for machine sales and other business opportunities. The agreement had an initial term of one (1) year and has automatically renewed for successive terms, although either party can terminate the agreement for any reason by providing the other party 30 days' notice.

We entered into a consulting agreement with Strategic Global Partners, Inc., an entity controlled by our founder and CEO, Sandro Piancone, on or about January 3, 2020, pursuant to which the entity would provide management, sales, marketing and logistics services to us in consideration of cash fees of $10,000/month for an initial term of sixty (60) months. The agreement also requires us to reimburse the entity for reasonable and necessary expenses incurred by the entity in performing its duties under the agreement. The agreement is terminable by either party only upon the provision of twelve (12) months' notice to the other party.

We entered into a consulting agreement with UST Mexico, Inc., an entity controlled by our founder and CEO, Sandro Piancone, on or about January 3, 2020, pursuant to which the entity would provide manufacturing, production, supplier management, and equipment maintenance services to us in consideration of cash fees of $15,000/month for an initial term of sixty (60) months. The agreement also requires us to reimburse the entity for reasonable and necessary expenses incurred by the entity in performing its duties under the agreement. The agreement is terminable by either party only upon the provision of twelve (12) months' notice to the other party.

We entered into an Interim Consulting Agreement with Neville Pearson, our Interim Chief Financial Officer, on March 1, 2021, for him to act as our Interim Chief Financial Officer for a period from March 1, 2021, through August 31, 2021, and pursuant which Mr. Pearson would be paid $5,000 per month. Beginning on September 1, 2021, Mr. Pearson entered into an agreement with our majority shareholder, Green Globe International, Inc., pursuant to which he would act as the Chief Financial Officer of it, would be compensated by it instead of us, but would continue to act as our Chief Financial Officer.

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On January 20, 2022, we entered into an employment agreement with Mr. Piancone, which supersedes and replaces our prior consulting agreement with Mr. Piancone's entity, Strategic Global Partners, Inc. Pursuant to the employment agreement, which has an initial term of three years, Mr. Piancone agreed to act as our Chief Executive Officer, devote his full time (approximately 40 hours per week) and attention to the performance of Company duties, and we agreed to pay Mr. Piancone an annual base salary of $120,000, as well as an annual bonus up to 110% of Mr. Piancone's base salary, based on Mr. Piancone's and the Company's performance, each as determined by our Board of Directors (the "Board"). Mr. Piancone is also eligible to receive annual grants of long-term incentive awards (with an initial incentive award target value of 130% of Mr. Piancone's base salary) and participate in other Company employee benefit plans, if any, and is entitled to take 30 days of paid vacation during each 12-month period. Mr. Piancone is to be reimbursed for expenses incurred in connection with his employment, and during the period of Mr. Piancone's employment with the Company and for two years thereafter, Mr. Piancone is prohibited from competing with the Company in the manufacturing of hemp smokable products. Mr. Piancone assigned to the Company any intellectual property rights related to our operations that he may have had prior to the effective date of the employment agreement. Mr. Piancone's employment can be terminated by the Company at any time or by Mr. Piancone upon the provision of 30 days' notice to the Company. If the Company terminates Mr. Piancone's employment for a reason other than "Cause" (as defined below), Mr. Piancone will be entitled to a severance payment in an amount equal to 12 months of Mr. Piancone's base salary in effect as of the termination. If Mr. Piancone's employment is terminated (i) by the Company without Cause following a "Change in Control" (as defined below), or (ii) following a Change in Control, because Mr. Piancone has resigned due to a material reduction in his authority, duties or responsibilities, a material reduction in his base salary or benefits, a mandatory relocation more than 50 miles from Mr. Piancone's then-current place of employment, or the Company's failure to obtain the assumption of the employment agreement upon the Change in Control, then Mr. Piancone will be entitled to a severance payment in an amount equal Mr. Piancone's base salary in effect as of the termination (or the highest base salary during the three years prior to the termination) plus the average annual bonus for the prior three years (or if the termination occurs before the annual bonus is paid for the employee's first year of employment, 110% of the base salary). "Cause" is generally defined as (i) conviction or plea of no contest to the commission of a felony or any misdemeanor that is causing substantial harm to the Company or is a crime of moral turpitude, (ii) repeated intoxication by alcohol or drugs that materially and adversely affects the employee's performance of his duties, (iii) malfeasance in the conduct of the employee's duties, including misuse or diversion of Company funds, embezzlement, or misrepresentations or concealments on any written reports submitted by or on behalf of the Company, (iv) violation of any provision of the employment agreement, (v) failure to perform the duties required by the employee's employment with the Company after the employee shall have been informed, in writing, of the material failure, and given 30 days to remedy the failure, or (vi) failure to follow or comply with the reasonable and lawful written directives or policies of the Company. "Change in Control" is generally defined as an acquisition of 40% or more of the voting securities of the Company, the approval by the Company's stockholders of a complete liquidation or dissolution, or the consummation of a reorganization, merger, consolidation or sale of substantially all of the assets of the Company, unless following the transaction (i) the beneficial owners of the Company's voting securities before the transaction continue to beneficially own more than 60% of the voting securities of the Company after the transaction, (ii) no beneficial owner owns more than 40% of the voting securities of the Company after the transaction unless that ownership existed prior to the transaction, and (iii) at least a majority of the Board members after the transaction were members of the Board before the transaction.

On January 20, 2022, we entered into an employment agreement with Mr. Pearson. Pursuant to the employment agreement, which has an initial term of three years, Mr. Pearson agreed to act as our Chief Financial Officer, devote his full time (approximately 40 hours per week) and attention to the performance of Company duties, and we agreed to pay Mr. Pearson an annual base salary of $60,000, as well as an annual bonus up to 110% of Mr. Pearson's base salary, based on Mr. Pearson's and the Company's performance, each as determined by the Board. Mr. Pearson is also eligible to receive annual grants of long-term incentive awards (with an initial incentive award target value of 130% of Mr. Pearson's base salary) and participate in other Company employee benefit plans, if any, and is entitled to take 30 days of paid vacation during each 12-month period. Mr. Pearson is to be reimbursed for expenses incurred in connection with his employment, and during the period of Mr. Pearson's employment with the Company and for two years thereafter, Mr. Pearson is prohibited from competing with the Company in the manufacturing of hemp smokable products. Mr. Pearson assigned to the Company any intellectual property rights related to our operations that he may have had prior to the effective date of the employment agreement. Mr. Pearson's employment can be terminated by the Company at any time or by Mr. Pearson upon the provision of 30 days' notice to the Company. If the Company terminates Mr. Pearson's employment for a reason other than "Cause" (as defined below), Mr. Pearson will be entitled to a severance payment in an amount equal to 12 months of Mr. Pearson's base salary in effect as of the termination. If Mr. Pearson's employment is terminated (i) by the Company without Cause following a "Change in Control" (as defined below), or (ii) following a Change in Control, because Mr. Pearson has resigned due to a material reduction in his authority, duties or responsibilities, a material reduction in his base salary or benefits, a mandatory relocation more than 50 miles from Mr. Pearson's then-current place of employment, or the Company's failure to obtain the assumption of the employment agreement upon the Change in Control, then Mr. Pearson will be entitled to a severance payment in an amount equal Mr. Pearson's base salary in effect as of the termination (or the highest base salary during the three years prior to the termination) plus the average annual bonus for the prior three years (or if the termination occurs before the annual bonus is paid for the employee's first year of employment, 110% of the base salary). "Cause" is generally defined as (i) conviction or plea of no contest to the commission of a felony or any misdemeanor that is causing substantial harm to the Company or is a crime of moral turpitude, (ii) repeated intoxication by alcohol or drugs that materially and adversely affects the employee's performance of his duties, (iii) malfeasance in the conduct of the employee's duties, including misuse or diversion of Company funds, embezzlement, or misrepresentations or concealments on any written reports submitted by or on behalf of the Company, (iv) violation of any provision of the employment agreement, (v) failure to perform the duties required by the employee's employment with the Company after the employee shall have been informed, in writing, of the material failure, and given 30 days to remedy the failure, or (vi) failure to follow or comply with the reasonable and lawful written directives or policies of the Company. "Change in Control" is generally defined as an acquisition of 40% or more of the voting securities of the Company, the approval by the Company's stockholders of a complete liquidation or dissolution, or the consummation of a reorganization, merger, consolidation or sale of substantially all of the assets of the Company, unless following the transaction (i) the beneficial owners of the Company's voting securities before the transaction continue to beneficially own more than 60% of the voting securities of the Company after the transaction, (ii) no beneficial owner owns more than 40% of the voting securities of the Company after the transaction unless that ownership existed prior to the transaction, and (iii) at least a majority of the Board members after the transaction were members of the Board before the transaction.

On February 3, 2022, we entered into an employment agreement with Mr. Olson, which supersedes and replaces our prior consulting agreement with Mr. Olson's entity, Cube17, Inc. Pursuant to the employment agreement, which has an initial term of three years, Mr. Olson agreed to act as our Chief Marketing Officer, devote his full time (approximately 40 hours per week) and attention to the performance of Company duties, and we agreed to pay Mr. Olson an annual base salary of $120,000, as well as an annual bonus up to 500% of Mr. Olson's base salary, based on Mr. Olson's and the Company's performance, each as determined by the Board. Mr. Olson is also eligible to receive annual grants of long-term incentive awards (with an initial incentive award target value of 1,000% of Mr. Olson's base salary) and participate in other Company employee benefit plans, if any, and is entitled to take 30 days of paid vacation during each 12-month period. Mr. Olson is to be reimbursed for expenses incurred in connection with his employment, and to receive $350 per diem for Company-related travel outside San Diego, California, and during the period of Mr. Olson's employment with the Company and for two years thereafter, Mr. Olson is prohibited from competing with the Company in the manufacturing of hemp smokable products. Mr. Olson assigned to the Company any intellectual property rights he developed for the Company that he may have had prior to the effective date of the employment agreement (but specifically not including rights to Mr. Olson's literary works; marketing funnels; LinkedIn groups, Facebook groups, or other social media contacts and accounts; audios, podcasts, videos and courses not connected to the Company; and websites not connected to the Company). Mr. Olson's employment can be terminated by the Company or by Mr. Olson upon the provision of 30 days' notice to the other party. If (i) the Company terminates Mr. Olson's employment for a reason other than "Cause" (as defined below), or (ii) Mr. Olson's employment is terminated following a "Change in Control" (as defined below) because Mr. Olson has resigned due to a material reduction in his authority, duties or responsibilities, a material reduction in his base salary or benefits, a mandatory relocation more than 50 miles from Mr. Olson's then-current place of employment, or the Company's failure to obtain the assumption of the employment agreement upon the Change in Control, then Mr. Olson will be entitled to a severance payment in an amount equal two times the sum of (i) Mr. Olson's base salary in effect as of the termination (or the highest base salary during the three years prior to the termination), and (ii) the average annual bonus for the prior three years (or if the termination occurs before the annual bonus is paid for the employee's first year of employment, 110% of the base salary). "Cause" is generally defined as (i) conviction or plea of no contest to the commission of a felony or any misdemeanor that is causing substantial harm to the Company or is a crime of moral turpitude, (ii) repeated intoxication by alcohol or drugs that materially and adversely affects the employee's performance of his duties, (iii) malfeasance in the conduct of the employee's duties, including misuse or diversion of Company funds, embezzlement, or misrepresentations or concealments on any written reports submitted by or on behalf of the Company, (iv) violation of any provision of the employment agreement, (v) failure to perform the duties required by the employee's employment with the Company after the employee shall have been informed, in writing, of the material failure, and given 30 days to remedy the failure, or (vi) failure to follow or comply with the reasonable and lawful written directives or policies of the Company. "Change in Control" is generally defined as an acquisition of 40% or more of the voting securities of the Company, the approval by the Company's stockholders of a complete liquidation or dissolution, or the consummation of a reorganization, merger, consolidation or sale of substantially all of the assets of the Company, unless following the transaction (i) the beneficial owners of the Company's voting securities before the transaction continue to beneficially own more than 60% of the voting securities of the Company after the transaction, (ii) no beneficial owner owns more than 40% of the voting securities of the Company after the transaction unless that ownership existed prior to the transaction, and (iii) at least a majority of the Board members after the transaction were members of the Board before the transaction.

On August 29, 2022, we entered into an independent director agreement with Ms. Stephens, pursuant to which she would serve as an independent director on our Board of Directors, but pursuant to which Ms. Stephens' compensation terms were to be determined as of a later date.

**Outstanding Equity Awards at Fiscal Year-End**

No executive officer named above had any unexercised options, stock that has not vested or equity incentive plan awards outstanding as of December 31, 2022 and 2021.

**Director Compensation**

No member of our board of directors received any compensation for his or her services as a director during the fiscal years ending December 31, 2022 and 2021, nor do they currently receive any compensation for such services.

Effective September 2, 2022, we determined to begin compensating each of our directors as follows: (i) during the first year (September 2, 2022-September 1, 2023), no cash compensation will be paid; (ii) during the second year, the directors will be paid $12,000 for the year, prorated and paid monthly; (iii) during the third year, the directors will be paid $24,000 for the year, prorated and paid monthly; and (iv) each director shall receive options to purchase 75,000 shares of our common stock at $2.00/share, which shall vest monthly over three years and shall be exercisable for seven years from the date of grant. No written agreements have been entered into to implement this director compensation structure.

**Equity Incentive Plans**

*Long-Term Incentive Plans.* The Company does not provide its officers or employees with pension, stock appreciation rights, long-term incentive or other plans, nor does it provide non-qualified deferred compensation to its officers or employees, and therefore, the Summary Compensation Table above does not include columns for nonequity incentive plan compensation and nonqualified deferred compensation earnings since there were none.

*Employee Pension, Profit Sharing or other Retirement Plans.* The Company does not have a defined benefit, pension plan, profit sharing or other retirement plan, although it may adopt one or more of such plans in the future.

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**CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS**

**Transactions with Related Persons**

The following includes a summary of transactions during the fiscal years ending December 31, 2021 and 2020, or any currently proposed transaction, in which we were or are to be a participant and the amount involved exceeded or exceeds the lesser of $120,000 or one percent of the average of our total assets at year-end for the last three completed fiscal years, and in which any related person had or will have a direct or indirect material interest (other than compensation described under "*Executive Compensation*" above). We believe the terms obtained or consideration that we paid or received, as applicable, in connection with the transactions described below were comparable to terms available or the amounts that would be paid or received, as applicable, in arm's-length transactions.

On October 22, 2019, we entered into a Kiosk Acquisition Agreement with Mexico Franchise Opportunity Fund LP ("MFOF"), a related party entity owned approximately 31% by our founder and CEO, Sandro Piancone, and approximately 25% by our founder and officer, Jorge Olson, to purchase 600 vending kiosks for total consideration of $3,638,357, payable by the issuance of 8,000,000 shares of Series A Preferred Shares to MFOF. Due to the related party status of MFOF, and since the entities were under common control, we used the carryover basis of accounting, and the 600 kiosks were recorded at net book value of $3,638,357 upon acquisition.

As of December 31, 2021 and 2020, we owed $29,000 and $53,877, respectively, to UST Mexico, Inc. ("UST"), an entity controlled by our founder and CEO, Mr. Piancone, which manufactures tobacco cigarettes in Mexico, for consulting fees payable to UST for manufacturing, production, supplier management, and equipment maintenance services. As of December 31, 2021 and 2020, we were owed $132,147 and $0, respectively, by UST for products we sold to UST and for equipment parts provided to UST. The value of goods and services we provided to UST was $152,147 and $62,174 for the years ended December 31, 2021 and 2020, respectively, and the value of goods and services provided by UST to us was $251,000 and $205,127 for the years ended December 31, 2021 and 2020, respectively. The value of goods and services provided by UST to us was $147,182 for the nine months ended September 30, 2022. As of September 30, 2022, we were owed $134,534 by UST for products we sold to UST and for equipment parts provided to UST. The value of goods and services we provided to UST was $31,840 for the nine months ended September 30, 2022, and as of September 30, 2022, we owed $12,181 to UST.

As of December 31, 2020, we owed $120,000 to Strategic Global Partners, Inc. ("SGP"), Mr. Piancone's entity, for consulting fees payable to the entity for Mr. Piancone's management, sales and other services to us during 2020. We accrued another $50,000 in consulting fees to SGP through May of 2021, and on May 21, 2021, we issued 170,000 shares of common stock to SGP in satisfaction of the total accrued fees of $170,000. As of December 31, 2021, we owed $70,000 to SGP for services rendered by SGP to us. Consulting expenses of $60,000 were recorded for the nine months ended September 30, 2022, and as of September 30, 2022, we owed $28,000 to SGP for services rendered by SGP to us.

As of December 31, 2019, we owed $15,000 to Cube17, Inc. ("Cube"), Mr. Olson's entity, for consulting fees payable to the entity for Mr. Olson's sales, marketing and other services to us during 2019. We accrued another $120,000 in consulting fees to Cube in 2020, and another $50,000 through May of 2021, and on May 21, 2021, we issued 185,000 shares of common stock to Cube in satisfaction of the total accrued fees of $185,000. As of December 31, 2021 and 2020, we owed $63,404 and $135,000, respectively to Cube for services rendered by Cube to us. Consulting expenses to Cube of $30,000 were recorded for the nine months ended September 30, 2022. As of September 30, 2022, we owed $47,738 to Cube for services rendered by Cube to us.

As of December 31, 2021 and 2020, we owed Primus Logistics, our landlord and an entity which is owned 90% by Mr. Piancone, $0 and $116,940, respectively, for rent, inventory and product storage. As of December 31, 2021, Primus Logistics had been paid $14,764 in advance for rent. As of September 30, 2022, we owed Primus Logistics $9. As of September 30, 2022, Primus Logistics had been paid $17,752 in advance for rent.

Lake Como is also owned and controlled by Mr. Piancone. This entity is used by us primarily as a sales company for our products, and it sometimes sells products it purchases from us. As of December 31, 2021 and 2020, we had receivables of $150 and $5,586, respectively, from Lake Como for sales of our products made by Lake Como. As of September 30, 2022, we had receivables of $150 from Lake Como for sales of our products made by Lake Como.

On or about March 18, 2022, we borrowed $50,000 from Jerry Halamuda, one of our directors, and issued Mr. Halamuda a $50,000 promissory note, accruing interest at 8% per annum, which originally matured on June 18, 2022, and was extended to mature on December 18, 2022. The note is secured by 50,000 shares of our common stock.

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*<u>Transactions in Connection with Green Globe International, Inc.</u>*

In February 2021, we negotiated the acquisition from an unrelated third party of 100 shares of super-voting Series A Preferred Stock (the "Control Block") of Green Globe International, Inc., a Delaware corporation ("Green Globe"), for a purchase price of $50,000, with the understanding that the officers and directors of Green Globe at the time would resign and our officers and directors and nominees would be appointed as the officers and directors of Green Globe upon payment of the $50,000 acquisition purchase price. The Control Block was entitled to approximately 80% of the voting rights of the capital stock of Green Globe, and there were approximately 3,700,640,356 shares of Green Globe common stock outstanding at the time. Green Globe had not filed any quarterly or annual reports with OTCMarkets.com since May 16, 2019, and we viewed Green Globe as insolvent because, at that time, its liabilities exceeded its assets, it had no current assets and had a working capital deficit, it was not generating revenues, and it was not generating any cash flows from operations, investing activities, or financing activities. Subsequent reports filed by Green Globe with OTCMarkets.com indicated that it was a shell company (i.e., a company with no or nominal non-cash assets and no or nominal operations) at that time. We also determined that upon acquiring control of Green Globe, we would cancel the Control Block and have Green Globe acquire Hempacco in a share exchange transaction by issuing 70,312,160,174 shares of Green Globe common stock in exchange for all outstanding shares of Hempacco, such that (i) Hempacco would become a wholly-owned subsidiary of Green Globe, (ii) Hempacco's shareholders immediately prior to acquiring Hempacco would receive 95% of the common stock of Green Globe (70,312,160,174 shares out of 74,012,800,530 that would be outstanding following the share exchange), and (iii) Green Globe's common shareholders immediately prior to acquiring Hempacco would retain 5% of Green Globe's common stock (3,700,640,356 shares out of 74,012,800,530 shares that would be outstanding following the share exchange). We also determined at the time that we did not want to effect the share exchange with Green Globe until we had resolved as many of our outstanding liabilities as practicable. We did not obtain any fairness opinion or other valuation of either Green Globe or Hempacco at the time, and the 70,312,160,174-share number (the number of shares of Green Globe we determined would be issued to Hempacco's shareholders in the share exchange transaction) was arbitrarily determined by us without reference to any particular valuation or book value.

On or about March 22, 2021, we paid the $50,000 purchase price for the Control Block and acquired it, the officers and directors of Green Globe resigned, and our officers, our sole director at the time, and two other director nominees selected by us were appointed as the officers and directors of Green Globe as follows: (i) our CEO and sole director, Sandro Piancone, was appointed as CEO and director of Green Globe; (ii) Neville Pearson, our Chief Financial Officer, was appointed as the Chief Financial Officer, Secretary and Treasurer of Green Globe; (iii) Jorge Olson, our Chief Marketing Officer, was appointed as the Chief Marketing Officer of Green Globe; and (iv) Jerry Halamuda and Dr. Stuart Titus, who at the time had no positions with us, were appointed as directors of Green Globe at our direction.

As of March 22, 2021, we had outstanding approximately 8,478,000 shares of common stock and 8,000,000 Series A Preferred Shares. Between March 22, 2021, and May 21, 2021, we negotiated with counterparties owed funds by us, including the related parties described below, with the goal of resolving as much of our outstanding obligations as possible prior to effecting the share exchange with Green Globe. We then issued 9,917,532 shares of our common stock, and then closed the share exchange with Green Globe on May 21, 2021, with all 18,395,532 shares of our outstanding common stock transferred to Green Globe in consideration of Green Globe's issuance of an aggregate of 70,312,160,174 shares to our shareholders. The 9,917,532 shares of common stock we issued on May 21, 2021, are described below. Between March 22, 2021, and May 21, 2021, Mr. Piancone was our CEO and sole director, he was the CEO and one of the directors of Green Globe, he was the officer and control person of several of the related party entities described below, and he functionally controlled both us and Green Globe.

On October 22, 2019, we had entered into a Kiosk Acquisition Agreement with Mexico Franchise Opportunity Fund LP ("MFOF") (a related party entity of which approximately 31% is owned by our founder and CEO, Sandro Piancone, and approximately 25% is owned by our founder and CMO, Jorge Olson) to purchase 600 vending kiosks for total consideration of $3,638,357, payable by the issuance of 8,000,000 shares of our Series A Preferred Shares to MFOF. On May 21, 2021, we issued 8,757,479 shares of common stock to MFOF upon conversion of the 8,000,000 shares of Series A Preferred Shares into common stock at $1.00 per share, and payment of 757,479 shares of common stock for accrued dividends of $757,479, due on the preferred shares, at $1.00 per share.

On May 21, 2021, we issued 357,006 shares of common stock to eight third-party lenders shares for conversion of debt owed to the lenders at $1.00 per share, with 336,500 of such shares issued upon conversion of principal of $336,500, and 20,506 of such shares issued upon conversion of accrued interest of $20,506.

On May 21, 2021, we issued 127,016 shares of common stock to Mr. Halamuda (now considered a related party as he was appointed as a member of our Board of Directors in July 2021) for conversion of debt owed to Mr. Halamuda at $1.00 per share, with 125,000 of such shares issued upon conversion of principal of $125,000, and 2,016 of such shares issued upon conversion of accrued interest of $2,016.

On May 21, 2021, we issued 51,030 shares of common stock to a lender (Dr. Stuart Titus, now considered a related party as he was appointed as our Chairman of the Board of Directors in July 2021) for conversion of debt owed to Dr. Titus at $1.00 per share, with 50,000 of such shares issued upon conversion of principal of $50,000, and 1,030 of such shares issued upon conversion of accrued interest of $1,030.

On May 21, 2021, we issued 170,000 shares of common stock to an entity (Strategic Global Partners, Inc.) controlled by our founder and CEO, Mr. Piancone, in satisfaction of $170,000 of accrued fees for management services owed to the entity by us.

On May 21, 2021, we issued 185,000 shares of common stock to an entity (Cube17, Inc.) controlled by our founder and CMO, Mr. Olson, in satisfaction of $185,000 of accrued fees for management services owed to the entity by us.

On May 21, 2021, we issued 170,000 shares of common stock to an entity (Primus Logistics) controlled by our founder and CEO, Mr. Piancone, for rent of our manufacturing and office facility from January 1, 2020, to May 31, 2021, valued at $170,000.

On May 21, 2021, we issued 100,000 shares of common stock to a third party for information technology, software development, and kiosk technical services provided by them to us valued at $100,000.

On or about March 1, 2022, we entered into a mutual line of credit agreement with Green Globe to facilitate our short-term borrowing needs on an interest-free basis, with advances being subject to repayment within 90 days with a maximum of $500,000 allowed to be outstanding within any 90-day period. During the nine months ended September 30, 2022, Green Globe and its other subsidiaries advanced or paid $621,755 to us under the line of credit, and we advanced or paid $683,100 to Green Globe and its subsidiaries under the line of credit. As of September 30, 2022, the balance owed to us by Green Globe was $61,345.

**Promoters and Certain Control Persons**

Each of our executive officers may be deemed a "promoter" as defined by Rule 405 of the Securities Act. For information regarding compensation, including items of value, that have been provided or that may be provided to these individuals, please refer to "*Executive Compensation*" above.

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**PRINCIPAL SHAREHOLDERS**

The following table sets forth certain information with respect to the beneficial ownership of our common stock as of the date of this prospectus for (i) each of our named executive officers and directors; (ii) all of our named executive officers and directors as a group; and (iii) each other shareholder known by us to be the beneficial owner of more than 5% of our outstanding common stock. The following table assumes that the underwriters have not exercised the over-allotment option.

Beneficial ownership is determined in accordance with SEC rules and generally includes voting or investment power with respect to securities. For purposes of this table, a person or group of persons is deemed to have "beneficial ownership" of any shares of common stock that such person or any member of such group has the right to acquire within sixty (60) days of the date of this prospectus. For purposes of computing the percentage of outstanding shares of our common stock held by each person or group of persons named above, any shares that such person or persons has the right to acquire within sixty (60) days of the date of this prospectus are deemed to be outstanding for such person, but not deemed to be outstanding for the purpose of computing the percentage ownership of any other person. The inclusion herein of any shares listed as beneficially owned does not constitute an admission of beneficial ownership by any person.

The percentages below are calculated based on 23,477,999 shares of our common stock, and 0 shares of our preferred stock, issued and outstanding as of December 31, 2022. We do not have any outstanding options, warrants exercisable for, or other securities convertible into shares of our common stock within the next 60 days which are deemed beneficially owned by the holder thereof. Unless otherwise indicated, the address of each beneficial owner listed in the table below is c/o our company, Hempacco Co., Inc., 9925 Airway Road, San Diego, CA, 92154.

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| **Name of Beneficial Owner**  | **Title of Class**  | **Amount and Nature of Beneficial Ownership** | **Percent of Class Before This Offering** | **Percent of Class After This Offering** |
| Sandro Piancone <sup>(1)</sup> | Common Stock | 17609688<br><sup>(2)</sup> | 75.0% |  |
| Dr. Stuart Titus <sup>(3)</sup> | Common Stock | 17709688<br><sup>(4)(5)</sup> | 75.4% |  |
| Jerry Halamuda <sup>(3)</sup> | Common Stock | 17659688<br><sup>(4)(6)</sup> | 75.2% |  |
| Neville Pearson <sup>(7)</sup> | Common Stock | 17659688<br><sup>(4)(8)</sup> | 75.2% |  |
| Jorge Olson<sup>(9)</sup> | Common Stock | -<br><sup>(10)</sup> | - |  |
| **All Officers and Directors as a Group** | **Common Stock** | **17809688**<br>**<sup>(11)</sup>** | **75.9% %**<br> |  |
| Rafael Rojas<sup>(12)</sup> | Common Stock | 1400000 | 6.0% |  |

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<sup>(1)</sup> CEO and Director of Hempacco; CEO and Director of our majority shareholder, Green Globe International, Inc.

<sup>(2)</sup> Mr. Piancone does not directly own any shares of our common stock. However, he is one of the directors of our majority shareholder, Green Globe International, Inc. (the majority of its directors are also directors or officers of us), and he owns approximately 31% of Mexico Franchise Opportunities Fund LP, which is the holder of approximately 25% of the common stock and a majority of the Series C preferred stock of Green Globe International, Inc. Accordingly, Mr. Piancone may be deemed to be the beneficial owner of shares held in the name of Green Globe International, Inc. As of December 31, 2022, 17,609,688 shares of our common stock were owned by Green Globe International, Inc.

<sup>(3)</sup> Director of Hempacco; director of our majority shareholder, Green Globe International, Inc.

<sup>(4)</sup> Dr. Titus, Mr. Halamuda and Neville Pearson are directors of our majority shareholder, Green Globe International, Inc., and therefore they share voting and dispositive power with respect to shares held in the name of Green Globe International, Inc., and may be deemed to be beneficial owners of shares held in the name of Green Globe International, Inc. As of December 31, 2022, 17,609,688 shares of our common stock were owned by Green Globe International, Inc.

<sup>(5)</sup> Includes 100,000 shares held by Dr. Titus, as well as 17,609,688 shares held by Green Globe International, Inc.

<sup>(6)</sup> Includes 50,000 shares held in the name of the Halamuda Family Trust, which shares are deemed to be beneficially owned by Mr. Halamuda, as well as 17,609,688 shares held by Green Globe International, Inc.

<sup>(7)</sup> CFO of Hempacco; CFO and director of our majority shareholder, Green Globe International, Inc.

<sup>(8)</sup> Includes 50,000 shares held jointly with his spouse, as well as 17,609,688 shares held by Green Globe International, Inc. 

<sup>(9)</sup> CMO and Director; CMO of our majority shareholder, Green Globe International, Inc.

<sup>(10)</sup> Mr. Olson is the CMO of our majority shareholder, Green Globe International, Inc., but he is not a director of it, he does not have or share voting or dispositive power with respect to shares held in the name of Green Globe International, Inc., and he beneficially owns no other shares of our stock.

<sup>(11)</sup> Includes 17,609,688 shares held by Green Globe International, Inc., 100,000 shares held by Dr. Titus, 50,000 shares held in the name of the Halamuda Family Trust, and 50,000 shares held by Mr. Pearson with his spouse.

<sup>(12)</sup> Held in the name of Nery's Logistics, Inc. The Company believes that Mr. Rojas has voting and dispositive power of shares held in the name of Nery's Logistics, Inc., as he is its sole director and majority shareholder. 

We do not currently have any arrangements which if consummated may result in a change of control of our company.

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**DESCRIPTION OF SECURITIES**

**General**

Our authorized capital stock currently consists of 250,000,000 shares, consisting of 200,000,000 shares of common stock, par value $0.001 per share, and 50,000,000 shares of "blank check" preferred stock, par value $0.001 per share.

The following description summarizes important terms of the classes of our capital stock following the filing of our articles of incorporation. This summary does not purport to be complete and is qualified in its entirety by the provisions of our articles of incorporation and our bylaws which have been filed as exhibits to the registration statement of which this prospectus is a part.

As of the date of this prospectus, there were 23,477,999 shares of common stock and no shares of preferred stock issued and outstanding. Upon closing of this offering, we will have 28,207,728 shares of common stock issued and outstanding (or 28,917,187 shares if the underwriters exercise the over-allotment option in full), and no shares of preferred stock will be issued and outstanding.

**Common Stock**

*Voting Rights.* The holders of common stock are entitled to one vote for each share held of record on all matters submitted to a vote of the shareholders. Under our articles of incorporation and bylaws, any corporate action to be taken by vote of shareholders other than for election of directors shall be authorized by the affirmative vote of the majority of votes cast. Directors are elected by a plurality of votes. Shareholders do not have cumulative voting rights.

*Dividend Rights*. Subject to preferences that may be applicable to any then-outstanding preferred stock, holders of common stock are entitled to receive ratably those dividends, if any, as may be declared from time to time by the board of directors out of legally available funds.

*Liquidation Rights*. In the event of our liquidation, dissolution or winding up, holders of common stock will be entitled to share ratably in the net assets legally available for distribution to shareholders after the payment of all of our debts and other liabilities and the satisfaction of any liquidation preference granted to the holders of any then-outstanding shares of preferred stock.

*Other Rights*. Holders of common stock have no preemptive, conversion or subscription rights and there are no redemption or sinking fund provisions applicable to the common stock. The rights, preferences and privileges of the holders of common stock are subject to, and may be adversely affected by, the rights of the holders of shares of any series of preferred stock.

**Preferred Stock**

Our articles of incorporation authorize our board to issue up to 50,000,000 shares of preferred stock in one or more series, to determine the designations and the powers, preferences and rights and the qualifications, limitations and restrictions thereof, including the dividend rights, conversion or exchange rights, voting rights (including the number of votes per share), redemption rights and terms, liquidation preferences, sinking fund provisions and the number of shares constituting the series. Our board of directors could, without shareholder approval, issue preferred stock with voting and other rights that could adversely affect the voting power and other rights of the holders of common stock and which could have the effect of making it more difficult for a third party to acquire, or of discouraging a third party from attempting to acquire, a majority of our outstanding voting stock.

**Warrants**

Upon the closing of this offering, there will be up to 331,081 shares of common stock issuable upon exercise of the Representatives' warrants (up to 380,743 shares if the underwriters exercise their over-allotment option in full). See "*Underwriting*" below for a description of the Representatives' warrants.

**Options**

Although we may issue options to purchase our capital stock in the future, there are no outstanding options to purchase our capital stock, nor do we anticipate issuing options to purchase our common stock immediately after consummation of this offering.

**Anti-Takeover Provisions**

Provisions of the Nevada Revised Statutes, our articles of incorporation and our bylaws could have the effect of delaying or preventing a third-party from acquiring us, even if the acquisition would benefit our stockholders. Such provisions of the Nevada Revised Statutes, our articles of incorporation and our bylaws are intended to enhance the likelihood of continuity and stability in the composition of our board of directors and in the policies formulated by the board of directors and to discourage certain types of transactions that may involve an actual or threatened change of control of our company. These provisions are designed to reduce our vulnerability to an unsolicited proposal for a takeover that does not contemplate the acquisition of all of our outstanding shares, or an unsolicited proposal for the restructuring or sale of all or part of our company.

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***Nevada Anti-Takeover Statutes***

Pursuant to our articles of incorporation, we have elected not to be governed by the terms and provisions of Nevada's control share acquisition laws (Nevada Revised Statutes 78.378–78.3793), which prohibit an acquirer, under certain circumstances, from voting shares of a corporation's stock after crossing specific threshold ownership percentages, unless the acquirer obtains the approval of the issuing corporation's stockholders. The first such threshold is the acquisition of at least one-fifth but less than one-third of the outstanding voting power.

Pursuant to our articles of incorporation, we have also elected not to be governed by the terms and provisions of Nevada's combination with interested stockholder statutes (Nevada Revised Statutes §§ 78.411–78.444), which prohibit an "interested stockholder" from entering into a "combination" with the corporation, unless certain conditions are met. An "interested stockholder" is a person who, together with affiliates and associates, beneficially owns (or within the prior two years, did beneficially own) 10 percent or more of the corporation's voting stock, or otherwise has the ability to influence or control such corporation's management or policies.

***Bylaws***

In addition, various provisions of our bylaws may also have an anti-takeover effect. These provisions may delay, defer or prevent a tender offer or takeover attempt of the Company that a stockholder might consider in his or her best interest, including attempts that might result in a premium over the market price for the shares held by our stockholders. Our bylaws may be adopted, amended or repealed by the affirmative vote of the holders of at least a majority of our outstanding shares of capital stock entitled to vote for the election of directors, and except as provided by Nevada law, our board of directors shall have the power to adopt, amend or repeal the bylaws by a vote of not less than a majority of our directors. Any bylaw provision adopted by the board of directors may be amended or repealed by the holders of a majority of the outstanding shares of capital stock entitled to vote for the election of directors. Our bylaws also contain limitations as to who may call special meetings as well as require advance notice of stockholder matters to be brought at a meeting. Additionally, our bylaws also provide that no director may be removed by less than a two-thirds vote of the issued and outstanding shares entitled to vote on the removal. Our bylaws also permit the board of directors to establish the number of directors and fill any vacancies and newly created directorships. These provisions will prevent a shareholder from increasing the size of our board of directors and gaining control of our board of directors by filling the resulting vacancies with its own nominees.

Our bylaws establish an advance notice procedure for shareholder proposals to be brought before an annual meeting of our shareholders, including proposed nominations of persons for election to the board of directors. Shareholders at an annual meeting will only be able to consider proposals or nominations specified in the notice of meeting or brought before the meeting by or at the direction of the board of directors or by a shareholder who was a shareholder of record on the record date for the meeting, who is entitled to vote at the meeting and who has given us timely written notice, in proper form, of the shareholder's intention to bring that business before the meeting. Although our bylaws do not give the board of directors the power to approve or disapprove shareholder nominations of candidates or proposals regarding other business to be conducted at a special or annual meeting, our bylaws may have the effect of precluding the conduct of certain business at a meeting if the proper procedures are not followed or may discourage or deter a potential acquirer from conducting a solicitation of proxies to elect its own slate of directors or otherwise attempting to obtain control of our company.

***Authorized but Unissued Shares***

Our authorized but unissued shares of common stock are available for our board of directors to issue without stockholder approval. We may use these additional shares for a variety of corporate purposes, including raising additional capital, corporate acquisitions and employee stock plans. The existence of our authorized but unissued shares of common stock could render it more difficult or discourage an attempt to obtain control of the Company by means of a proxy context, tender offer, merger or other transaction since our board of directors can issue the Company large amounts of capital stock as part of a defense to a take-over challenge. In addition, we have authorized in our articles of incorporation 50,000,000 shares of preferred stock, none of which are currently designated or outstanding. However, the board acting alone and without approval of our stockholders can designate and issue one or more series of preferred stock containing super-voting provisions, enhanced economic rights, rights to elect directors, or other dilutive features, that could be utilized as part of a defense to a take-over challenge.

***Supermajority Voting Provisions***

Nevada Law provides generally that the affirmative vote of a majority of the shares entitled to vote on any matter is required to amend a corporation's articles of incorporation or bylaws, unless a corporation's articles of incorporation or bylaws, as the case may be, require a greater percentage. Although our articles of incorporation and bylaws do not currently provide for such a supermajority vote on any matters, our board of directors can amend our bylaws and we can, with the approval of our stockholders, amend our articles of incorporation to provide for such a super-majority voting provision.

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***Cumulative Voting***

Furthermore, neither the holders of our common stock nor the holders of our preferred stock have cumulative voting rights in the election of our directors. The combination of the present ownership by a few shareholders of a significant portion of our issued and outstanding common stock and lack of cumulative voting makes it more difficult for other shareholders to replace our board of directors or for a third party to obtain control of our company by replacing its board of directors.

**Transfer Agent and Registrar**

Transfer Online, Inc., 512 SE Salmon Street, Portland, Oregon, 97214, telephone (503) 227-2950, is the transfer agent for our common stock.

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**SHARES ELIGIBLE FOR FUTURE SALE**

Before this offering, there has not been a public market for shares of our common stock. Future sales of substantial amounts of shares of our common stock, including shares issued upon the conversion of convertible notes, the exercise of outstanding options and warrants, in the public market after this offering, or the possibility of these sales occurring, could cause the prevailing market price for our common stock to fall or impair our ability to raise equity capital in the future.

Immediately following the closing of this offering, we will have 28,207,728 shares of common stock issued and outstanding. In the event the underwriters exercise in full the over-allotment option to purchase additional shares of common stock, we will have 28,917,187 shares of common stock issued and outstanding. The common stock sold in this offering will be freely tradable without restriction or further registration or qualification under the Securities Act.

Previously issued shares of common stock that were not offered and sold in this offering, as well as shares issuable upon the exercise of warrants and subject to employee stock options, are or will be upon issuance, "restricted securities," as that term is defined in Rule 144 under the Securities Act. These restricted securities are eligible for public sale only if such public resale is registered under the Securities Act or if the resale qualifies for an exemption from registration under Rule 144 or Rule 701 under the Securities Act, which are summarized below.

**Rule 144**

In general, a person who has beneficially owned restricted shares of our common stock for at least twelve months, or at least six months in the event we have been a reporting company under the Exchange Act for at least ninety (90) days before the sale, would be entitled to sell such securities, provided that such person is not deemed to be an affiliate of ours at the time of sale or to have been an affiliate of ours at any time during the ninety (90) days preceding the sale. A person who is an affiliate of ours at such time would be subject to additional restrictions, by which such person would be entitled to sell within any three-month period only a number of shares that does not exceed the greater of the following:

· 1% of the number of shares of our common stock then outstanding; or

· 1% of the average weekly trading volume of our common stock during the four calendar weeks preceding the filing by such person of a notice on Form 144 with respect to the sale;

provided that, in each case, we are subject to the periodic reporting requirements of the Exchange Act for at least 90 days before the sale. Rule 144 trades must also comply with the manner of sale, notice and other provisions of Rule 144, to the extent applicable.

**Rule 701**

In general, Rule 701 allows a shareholder who purchased shares of our capital stock pursuant to a written compensatory plan or contract and who is not deemed to have been an affiliate of ours during the immediately preceding 90 days to sell those shares in reliance upon Rule 144, but without being required to comply with the public information, holding period, volume limitation or notice provisions of Rule 144. All holders of Rule 701 shares, however, are required to wait until ninety (90) days after the date of this prospectus before selling shares pursuant to Rule 701.

**Lock-Up Agreements**

Our executive officers, directors and our security holder(s) of five percent (5%) or more of our securities have agreed not to offer, sell, agree to sell, directly or indirectly, or otherwise dispose of any shares of our common stock for a lock-up period through August 30, 2023, subject to certain exceptions, and we have agreed not to offer or sell any shares of stock until September 1, 2023. See the "*Underwriting*" section below for more information.

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**MATERIAL U.S. FEDERAL TAX CONSIDERATIONS FOR NON-U.S. HOLDERS OF OUR SECURITIES**

The following is a summary of the material U.S. federal income and estate tax consequences of the ownership and disposition of our common stock that is being issued pursuant to this offering. This summary is limited to Non-U.S. Holders (as defined below) that hold our common stock as a capital asset (generally, property held for investment) for U.S. federal income tax purposes. This summary does not discuss all of the aspects of U.S. federal income and estate taxation that may be relevant to a Non-U.S. Holder in light of the Non-U.S. Holder's particular investment or other circumstances. Accordingly, all prospective Non-U.S. Holders should consult their own tax advisors with respect to the U.S. federal, state, local and non-U.S. tax consequences of the ownership and disposition of our common stock.

This summary is based on provisions of the Code, applicable U.S. Treasury regulations and administrative and judicial interpretations, all as in effect or in existence on the date of this prospectus. Subsequent developments in U.S. federal income or estate tax law, including changes in law or differing interpretations, which may be applied retroactively, could alter the U.S. federal income and estate tax consequences of owning and disposing of our common stock as described in this summary. There can be no assurance that the Internal Revenue Service, or IRS, will not take a contrary position with respect to one or more of the tax consequences described herein and we have not obtained, nor do we intend to obtain, a ruling from the IRS with respect to the U.S. federal income or estate tax consequences of the ownership or disposition of our common stock.

As used in this summary, the term "Non-U.S. Holder" means a beneficial owner of our common stock that is not, for U.S. federal income tax purposes:

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| an individual who is a citizen or resident of the United States; |
| a corporation (or other entity treated as a corporation) created or organized in or under the laws of the United States, any state thereof, or the District of Columbia; |
| an entity or arrangement treated as a partnership; |
| an estate whose income is includible in gross income for U.S. federal income tax purposes regardless of its source; or |
| a trust, if (1) a U.S. court is able to exercise primary supervision over the trust's administration and one or more "United States persons" (within the meaning of the Code) has the authority to control all of the trust's substantial decisions, or (2) the trust has a valid election in effect under applicable U.S. Treasury regulations to be treated as a United States person. |

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If an entity or arrangement treated as a partnership for U.S. federal income tax purposes holds our common stock, the tax treatment of a partner in such a partnership generally will depend upon the status of the partner, the activities of the partnership and certain determinations made at the partner level. Partnerships, and partners in partnerships, that hold our common stock should consult their own tax advisors as to the particular U.S. federal income and estate tax consequences of owning and disposing of our common stock that are applicable to them.

This summary does not consider any specific facts or circumstances that may apply to a Non-U.S. Holder and does not address any special tax rules that may apply to particular Non-U.S. Holders, such as:

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| a Non-U.S. Holder that is a financial institution, insurance company, tax-exempt organization, pension plan, broker, dealer or trader in securities, dealer in currencies, U.S. expatriate, controlled foreign corporation or passive foreign investment company; |
| a Non-U.S. Holder holding our common stock as part of a conversion, constructive sale, wash sale or other integrated transaction or a hedge, straddle or synthetic security; |
| a Non-U.S. Holder that holds or receives our common stock pursuant to the exercise of any employee stock option or otherwise as compensation; or |
| a Non-U.S. Holder that at any time owns, directly, indirectly or constructively, 5% or more of our outstanding common stock. |

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In addition, this summary does not address any U.S. state or local, or non-U.S. or other tax consequences, or any U.S. federal income or estate tax consequences for beneficial owners of a Non-U.S. Holder, including shareholders of a controlled foreign corporation or passive foreign investment company that holds our common stock.

**Each Non-U.S. Holder should consult its own tax advisor regarding the U.S. federal, state, local and non-U.S. income and other tax consequences of owning and disposing of our common stock.**

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**Distributions on Our Common Stock**

We do not currently expect to pay any cash dividends on our common stock. If we make distributions of cash or property (other than certain pro rata distributions of our common stock) with respect to our common stock, any such distributions generally will constitute dividends for U.S. federal income tax purposes to the extent paid from our current or accumulated earnings and profits, as determined under U.S. federal income tax rules. If a distribution exceeds our current and accumulated earnings and profits, the excess will be treated as a nontaxable return of capital to the extent of the Non-U.S. Holder's adjusted tax basis in our common stock and will reduce (but not below zero) such Non-U.S. Holder's adjusted tax basis in our common stock. Any remaining excess will be treated as gain from a disposition of our common stock subject to the tax treatment described below in "*— Dispositions of Our Common Stock*."

Distributions on our common stock that are treated as dividends and that are effectively connected with a Non-U.S. Holder's conduct of a trade or business in the United States will be taxed on a net income basis at the regular graduated rates and in the manner applicable to United States persons. An exception may apply if the Non-U.S. Holder is eligible for, and properly claims, the benefit of an applicable income tax treaty and the dividends are not attributable to a permanent establishment or fixed base maintained by the Non-U.S. Holder in the United States. In such case, the Non-U.S. Holder may be eligible for a lower rate under an applicable income tax treaty between the United States and its jurisdiction of tax residence. Dividends that are effectively connected with a Non-U.S. Holder's conduct of a trade or business in the United States will not be subject to the U.S. withholding tax if the Non-U.S. Holder provides to the applicable withholding agent a properly executed IRS Form W-8ECI (or other applicable form) in accordance with the applicable certification and disclosure requirements. A Non-U.S. Holder treated as a corporation for U.S. federal income tax purposes may also be subject to a "branch profits tax" at a 30% rate (unless the Non-U.S. Holder is eligible for a lower rate under an applicable income tax treaty) on the Non-U.S. Holder's earnings and profits (attributable to dividends on our common stock or otherwise) that are effectively connected with the Non-U.S. Holder's conduct of a trade or business within the United States. The amount of taxable earnings and profits is generally reduced by amounts reinvested in the operations of the U.S. trade or business and increased by any decline in its equity.

The certifications described above must be provided to the applicable withholding agent prior to the payment of dividends and must be updated periodically. A Non-U.S. Holder may obtain a refund or credit of any excess amounts withheld by timely filing an appropriate claim for a refund with the IRS. Non-U.S. Holders should consult their own tax advisors regarding their eligibility for benefits under any relevant income tax treaty and the manner of claiming such benefits.

The foregoing discussion is subject to the discussions below under "*Backup Withholding and Information Reporting*" and "*FATCA Withholding*."

**Dispositions of Our Common Stock**

A Non-U.S. Holder generally will not be subject to U.S. federal income tax (including U.S. withholding tax) on gain recognized on any sale or other disposition of our common stock unless:

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| the gain is effectively connected with the Non-U.S. Holder's conduct of a trade or business in the United States (and, if required by an applicable income tax treaty, is attributable to a permanent establishment or fixed base maintained by the Non-U.S. Holder in the United States); in such case, the gain would be subject to U.S. federal income tax on a net income basis at the regular graduated rates and in the manner applicable to United States persons (unless an applicable income tax treaty provides otherwise) and, if the Non-U.S. Holder is treated as a corporation for U.S. federal income tax purposes, the "branch profits tax" described above may also apply; |
| the Non-U.S. Holder is an individual who is present in the United States for 183 days or more in the taxable year of the disposition and meets certain other requirements; in such case, except as otherwise provided by an applicable income tax treaty, the gain, which may be offset by certain U.S. source capital losses, generally will be subject to a flat 30% U.S. federal income tax, even if the Non-U.S. Holder is not treated as a resident of the United States under the Code; or |
| we are or have been a "United States real property holding corporation" for U.S. federal income tax purposes at any time during the shorter of (i) the five-year period ending on the date of disposition and (ii) the period that the Non-U.S. Holder held our common stock. |

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Generally, a corporation is a "United States real property holding corporation" if the fair market value of its "United States real property interests" equals or exceeds 50% of the sum of the fair market value of its worldwide real property interests plus its other assets used or held for use in a trade or business. We believe that we are not currently, and we do not anticipate becoming in the future, a United States real property holding corporation. However, because the determination of whether we are a United States real property holding corporation is made from time to time and depends on the relative fair market values of our assets, there can be no assurance in this regard. If we were a United States real property holding corporation, the tax relating to disposition of stock in a United States real property holding corporation generally will not apply to a Non-U.S. Holder whose holdings, direct, indirect and constructive, constituted 5% or less of our common stock at all times during the applicable period, provided that our common stock are "regularly traded on an established securities market" (as provided in applicable U.S. Treasury regulations) at any time during the calendar year in which the disposition occurs. However, no assurance can be provided that our common stock will be regularly traded on an established securities market for purposes of the rules described above. Non-U.S. Holders should consult their own tax advisors regarding any possible adverse U.S. federal income tax consequences to them if we are, or were to become, a United States real property holding corporation.

The foregoing discussion is subject to the discussions below under "*Backup Withholding and Information Reporting*" and "*FATCA Withholding*."

**Federal Estate Tax**

Any shares of our common stock that are owned (or treated as owned) by an individual who is not a U.S. citizen or resident of the United States (as specially defined for U.S. federal estate tax purposes) at the time of death will be included in that individual's gross estate for U.S. federal estate tax purposes, unless an applicable estate tax or other treaty provides otherwise and, therefore, may be subject to U.S. federal estate tax.

**Backup Withholding and Information Reporting**

Backup withholding (currently at a rate of 24%) may apply to dividends paid by U.S. corporations in some circumstances, but will not apply to payments of dividends on our common stock to a Non-U.S. Holder if the Non-U.S. Holder provides to the applicable withholding agent a properly executed IRS Form W-8BEN or W-8BEN-E (or other applicable form) certifying under penalties of perjury that the Non-U.S. Holder is not a United States person or is otherwise entitled to an exemption. However, the applicable withholding agent generally will be required to report to the IRS (and to such Non-U.S. Holder) payments of dividends on our common stock and the amount of U.S. federal income tax, if any, withheld from those payments. In accordance with applicable treaties or agreements, the IRS may provide copies of such information returns to the tax authorities in the country in which the Non-U.S. Holder resides.

The gross proceeds from sales or other dispositions of our common stock may be subject, in certain circumstances discussed below, to U.S. backup withholding and information reporting. If a Non-U.S. Holder sells or otherwise disposes of any of our common stock outside the United States through a non-U.S. office of a non-U.S. broker and the disposition proceeds are paid to the Non-U.S. Holder outside the United States, the U.S. backup withholding and information reporting requirements generally will not apply to that payment. However, U.S. information reporting, but not U.S. backup withholding, will apply to a payment of disposition proceeds, even if that payment is made outside the United States, if a Non-U.S. Holder sells our common stock through a non-U.S. office of a broker that is a United States person or has certain enumerated connections with the United States, unless the broker has documentary evidence in its files that the Non-U.S. Holder is not a United States person and certain other conditions are met or the Non-U.S. Holder otherwise qualifies for an exemption.

If a Non-U.S. Holder receives payments of the proceeds of a disposition of our common stock to or through a U.S. office of a broker, the payment will be subject to both U.S. backup withholding and information reporting unless the Non-U.S. Holder provides to the broker a properly executed IRS Form W-8BEN or W-8BEN-E (or other applicable form) certifying under penalties of perjury that the Non-U.S. Holder is not a United States person, or the Non-U.S. Holder otherwise qualifies for an exemption.

Backup withholding is not an additional tax. Any amounts withheld under the backup withholding rules may be credited against the Non-U.S. Holder's U.S. federal income tax liability (which may result in the Non-U.S. Holder being entitled to a refund), provided that the required information is timely furnished to the IRS.

**FATCA Withholding**

The Foreign Account Tax Compliance Act and related Treasury guidance (commonly referred to as FATCA) impose U.S. federal withholding tax at a rate of 30% on payments to certain foreign entities of (i) U.S.-source dividends (including dividends paid on our common stock) and (ii) the gross proceeds from the sale or other disposition of property that produces U.S.-source dividends (including sales or other dispositions of our common stock). This withholding tax applies to a foreign entity, whether acting as a beneficial owner or an intermediary, unless such foreign entity complies with (i) certain information reporting requirements regarding its U.S. account holders and its U.S. owners and (ii) certain withholding obligations regarding certain payments to its account holders and certain other persons. Accordingly, the entity through which a Non-U.S. Holder holds its common stock will affect the determination of whether such withholding is required. While withholding under FATCA would have also applied to payments of gross proceeds from the sale or other disposition of our common stock on or after January 1, 2019, U.S. Treasury regulations proposed in December 2018 eliminate such withholding on payments of gross proceeds entirely. Taxpayers generally may rely on these proposed U.S. Treasury regulations until final U.S. Treasury regulations are issued. Non-U.S. Holders are encouraged to consult their tax advisors regarding FATCA.

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**UNDERWRITING**

In connection with this offering, we expect to enter an underwriting agreement with Boustead Securities, LLC and EF Hutton (which we refer to as the Representatives), as representatives of the underwriters named in this prospectus, with respect to the common stock in this offering. Under the terms and subject to the conditions contained in the underwriting agreement, the Representatives will agree to purchase from us on a firm commitment basis the respective number of shares of commons stock at the public price less the underwriting discounts and commissions set forth on the cover page of this prospectus, and each of the underwriters has severally agreed to purchase, and we have agreed to sell to the underwriters, at the public offering price per shares less the underwriting discounts and commissions set forth on the cover page of this prospectus, the number of shares of common stock listed next to its name in the following table.

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| **Underwriters** | **Number**<br>**of Shares** |
| Boustead Securities, LLC | ___ |
| EF Hutton, division of Benchmark Investments, Inc.  | ___ |
| Total |  |

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The shares of common stock sold by the underwriters to the public will initially be offered at the initial public offering price set forth on the cover page of this prospectus. Any shares of common stock sold by the underwriters to securities dealers may be sold at a discount from the initial public offering price not to exceed $__ per share. If all of the shares are not sold at the initial offering price, the Representatives may change the offering price and the other selling terms. The Representatives have advised us that the underwriters do not intend to make sales to discretionary accounts. The underwriting agreement will provide that the obligations of the underwriters to pay for and accept delivery of the shares of common stock are subject to the passing upon certain legal matters by counsel and certain conditions such as confirmation of the accuracy of representations and warranties by us about our financial condition and operations and other matters. The obligation of the underwriters to purchase the shares of common stock is conditioned upon our receiving approval to list the shares of common stock on NASDAQ.

If the underwriters sell more shares of common stock than the total number set forth in the table above, we have granted to the Representatives an option, exercisable one or more times in whole or in part, not later than 45 days after the date of this prospectus, to purchase up to 709,459 additional shares of common stock at the public offering price less the underwriting discounts and commissions set forth on the cover page of this prospectus, constituting 15% of the total number of shares of common stock to be offered in this offering (excluding shares subject to this option). The Representatives may exercise this option solely for the purpose of covering over-allotments in connection with this offering. This offering is being conducted on a firm commitment basis. Any shares of common stock issued or sold under the option will be issued and sold on the same terms and conditions as the other shares of common stock that are the subject of this offering.

**Discounts and Commissions; Expenses**

The underwriting discounts and commissions are a cash fee equal to: (i) seven percent (7%) of gross proceeds from the sale of securities in this offering. We have been advised by the Representatives that the underwriters propose to offer the common stock to the public at the public offering price set forth on the cover of this prospectus and to dealers at a price that represents a concession not in excess of $__ per share under the public offering price. After the offering, the Representatives may change the public offering price and other selling terms.

The following table summarizes the public offering price and the underwriting discounts and commissions payable to the underwriters by us in connection with this offering (assuming both the exercise in full and non-exercise of the over-allotment option that we have granted to the Representatives):

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|  | **Per Share** | **Total**<br>**Without**<br>**Over-**<br>**Allotment**<br>**Option** | **Total With**<br>**Full Over-**<br>**Allotment**<br>**Option** |
| Assumed public offering price | $| $5250000 | $6037500 |
| Underwriting discounts and commissions (1) | $| $367500 | $422625 |
| Non-accountable expense allowance (1%) | $| $52500 | $60375 |
| Proceeds, before expenses, to us | $| $4830000 | $5554500 |

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(1) Does not include (i) the warrant to purchase a number of shares of common stock equal to 7% of the number of shares sold in the offering, or (ii) amounts representing reimbursement of certain out-of-pocket expenses, each as described below.

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**Representatives' Warrants** 

We have agreed to issue to the Representatives (or their permitted assignees) warrants to purchase up to a total number of shares of common stock equal to 7% of the total number of shares of common stock sold in this offering at an exercise price equal to 100% of the public offering price of the common stock sold in this offering. The Representatives' warrants will be exercisable at any time, and from time to time, in whole or in part, commencing from the closing of the offering and expiring five (5) years from the effectiveness of the offering, will have a cashless exercise provision and will terminate on the fifth anniversary of the effective date of the registration statement of which this prospectus is a part. The Representatives' warrants are not exercisable or convertible for more than five years from the commencement of sales of the public offering. The Representatives' warrants also provide for customary anti-dilution provisions and immediate "piggyback" registration rights with respect to the registration of the shares underlying the warrants for a period of seven years from commencement of sales of this offering. We have registered the Representatives' warrants and the shares underlying the Representatives' warrants in this offering.

The Representatives' warrants and the underlying shares are deemed to be compensation by FINRA, and therefore will be subject to a 180-day lock-up period pursuant to FINRA Rule 5110(e)(1). In accordance with FINRA Rule 5110(e)(1), neither the Representatives' warrants nor any of our common stock issued upon exercise of the Representatives' warrants may be sold, transferred, assigned, pledged or hypothecated, or be the subject of any hedging, short sale, derivative, put or call transaction that would result in the effective economic disposition of such securities by any person, for a period of 180 days immediately following commencement of sale of this offering subject to certain exceptions permitted by FINRA Rule 5110(e)(2).

We have agreed to pay the Representatives a non-accountable expense allowance equal to 1% of the gross proceeds received at the closing of this offering.

We have agreed to reimburse the Representatives for reasonable out-of-pocket expenses incurred by the Representatives in connection with this offering, regardless of whether the offering is consummated, up to $55,000. The Representatives out-of-pocket expenses include but are not limited to: (i) road show and travel expenses, (ii) reasonable fees of Representatives' legal counsel, (iii) the cost of background check on our officers, directors and major shareholders and due diligence expenses. Any such out-of-pocket expenses described in the preceding sentence above $5,000 shall have been pre-approved by the Company. Any advance payments made by the Company to the Representatives to be applied against their actual out-of-pocket accountable expenses will be returned to us to the extent any portion of the advance is not actually incurred, in accordance with FINRA Rule 5110(g)(4)(A).

In connection with the offering, the underwriters may purchase and sell shares in the open market. Purchases and sales in the open market may include short sales, purchases to cover short positions, which may include purchases pursuant to the over-allotment option, and stabilizing purchases.

● Short sales involve secondary market sales by an underwriter of a greater number of shares than they are required to purchase in the offering.

● "Covered" short sales are sales of shares in an amount up to the number of shares represented by the over-allotment option.

● "Naked" short sales are sales of shares in an amount in excess of the number of shares represented by the over-allotment option.

● Covering transactions involve purchases of shares either pursuant to the over-allotment option or in the open market after the distribution has been completed in order to cover short positions.

● To close a naked short position, an underwriter must purchase shares in the open market after the distribution has been completed. A naked short position is more likely to be created if an underwriter is concerned that there may be downward pressure on the price of the shares in the open market after pricing that could adversely affect investors who purchase in the offering.

● To close a covered short position, an underwriter must purchase shares in the open market after the distribution has been completed or must exercise the over-allotment option. In determining the source of shares to close the covered short position, the underwriters will consider, among other things, the price of shares available for purchase in the open market as compared to the price at which they may purchase shares through the over-allotment option.

● Stabilizing transactions involve bids to purchase shares so long as the stabilizing bids do not exceed a specified maximum.

Purchases to cover short positions and stabilizing purchases, as well as other purchases by an underwriter for its own account, may have the effect of preventing or retarding a decline in the market price of the common stock. They may also cause the price of the common stock to be higher than the price that would otherwise exist in the open market in the absence of these transactions. The underwriters may conduct these transactions in the over-the-counter market or otherwise. If the underwriters commence any of these transactions, they may discontinue them at any time.

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**Determination of Offering Price**

In determining the initial public offering price, we and the Representatives have considered a number of factors, including:

● the information set forth in this prospectus and otherwise available to the Representatives;

● our prospects and the history and prospects for the industry in which we compete;

● an assessment of our management;

● our prospects for future revenue and earnings;

● the general condition of the securities markets at the time of this offering;

● the recent prices of, and demand for, shares sold by us prior to this offering;

● the recent market prices of, and demand for, publicly traded securities of generally comparable companies; and

● other factors deemed relevant by the Representatives and us.

The initial public offering price set forth on the cover page of this preliminary prospectus is subject to change as a result of market conditions and other factors. Neither we nor the Representatives can assure investors that an active trading market will develop for our common stock, or that the shares will trade in the public market at or above the initial public offering price.

**Indemnification**

We have agreed to indemnify the Representatives and the other underwriters against certain liabilities, including liabilities under the Securities Act. If we are unable to provide this indemnification, we will contribute to payments that the Representatives and the other underwriters may be required to make for these liabilities.

**Right of First Refusal**

The Representatives have the right of first refusal for two (2) years following the consummation of this offering or the termination or expiration of the engagement with the Representatives to act as financial advisor or to act as joint financial advisor on at least equal economic terms on any public or private financing (debt or equity), merger, business combination, recapitalization or sale of some or all of our equity or our assets, whether in conjunction with another broker-dealer or on the Company's own volition (collectively, "Future Services"). In the event that we engage the Representatives to provide such Future Services, the Representatives will be compensated consistent with the engagement agreement with the Representatives, unless we mutually agree otherwise. To the extent we are approached by a third party to lead any public or private financing (debt or equity), merger, business combination, recapitalization or sale of some or all of our equity or assets, the Representatives will be notified of the transaction and be granted the right to participate in such transaction under any syndicate formed by such third party.

**No Sales of Similar Securities**

We have agreed not to offer, issue, sell, contract to sell, encumber, grant any option for the sale of or otherwise dispose of any shares of our common stock or other securities convertible into or exercisable or exchangeable for shares of common stock, or modify the terms of any existing securities, whether in conjunction with another broker-dealer or on the Company's own volition until September 1, 2023, without the prior written consent of the Representatives.

**Lock-Up Agreements**

Our officers, directors, Green Globe International, Inc. (our majority shareholder which owns approximately 78.7% of our common stock as of December 31, 2022), and Nery's Logistics, Inc. (which owns approximately 6.0% of our common stock as of December 31, 2022) have each agreed not to offer, sell, agree to sell, directly or indirectly, or otherwise dispose of any shares of our common stock for a period through August 30, 2023 (the "Lock-Up Period"), except that the shareholders are permitted to transfer shares so long as (a) the transferee executes a lock-up agreement for the balance of the Lock-Up Period, (b) the transfer is not a disposition for value, (c) the transfer is not required to be reported in any public report or filing with the SEC, and (d) the shareholder does not voluntarily effect any public filing or report regarding such transfer: (i) as a gift, (ii) to any immediate family member, (iii) if the shareholder is a business entity that transfers the shares to another entity that is an affiliate of the shareholder or if the shareholder is a business entity that transfers the shares to its limited partners, members or stockholders, (iv) if the shareholder is a trust that transfers the shares to a trust beneficiary, or (v) by will or other testamentary document or intestate succession, or by operation of law pursuant to a domestic order or in connection with a divorce settlement. Additionally, our investors, who purchased in the aggregate 1,508,000 shares of our common stock in December of 2021 and April of 2022 (and which shares constitute in the aggregate approximately 6.5% of our outstanding common stock as of December 31, 2022) (such shareholders the "Pre-IPO Shareholders," and such shares the "Pre-IPO Shares"), have agreed not to sell, transfer or otherwise dispose of any of the Pre-IPO Shares until the 180<sup>th</sup> day after August 30, 2022 (the "Lock-Up Trigger Date"). Between 181 and 270 days after the Lock-Up Trigger Date, each of the Pre-IPO Shareholders has agreed not to sell, transfer or otherwise dispose of more than one-third of their Pre-IPO Shares, subject to a maximum sale on any trading day of 3% of the daily trading volume. Between 271 and 365 days after the Lock-Up Trigger Date, each of the Pre-IPO Shareholders has agreed not to sell, transfer or otherwise dispose of more than one-third of their Pre-IPO Shares, subject to a maximum sale on any trading day of 3% of the daily trading volume. After 365 days after the Lock-Up Trigger Date, the Pre-IPO Shareholders can sell their remaining Pre-IPO Shares without contractual restriction.

Additionally, commencing 90 days after the Lock-Up Trigger Date, if the price per share of the Company's common stock is at least 50% higher than the price per share in this offering and trades at least 100,000 shares daily, both for ten (10) consecutive trading days, each Pre-IPO Shareholder may sell one-third of its shares subject to a maximum sale on any trading day of 3% of the daily volume; and if the Company's common share price is at least 100% higher than the price per share in this offering and trades at least 100,000 shares daily, both for ten (10) consecutive trading days, each Pre-IPO Shareholder may sell up to an additional one-third of its shares subject to a maximum sale on any trading day of 3% of the daily volume; and if the Company common share price is at least 150% higher than the price per share in this offering and trades at least 100,000 shares daily, both for ten (10) consecutive trading days, each Pre-IPO Shareholder may sell an additional one-third constituting a maximum total of all of its shares subject to a maximum sale on any trading day of 3% of the daily volume.

The underwriters of this offering may engage in stabilization activities as described above. The Representatives may in its sole discretion and at any time without notice release some or all of the shares subject to lock-up agreements prior to the expiration of the Lock-Up Period. When determining whether or not to release shares from the lock-up agreements, the Representatives will consider, among other factors, the security holder's reasons for requesting the release, the number of shares for which the release is being requested and market conditions at the time.

**Electronic Offer, Sale and Distribution of Common Stock**

A prospectus in electronic format may be made available on the websites maintained by the Representatives. In addition, shares of common stock may be sold by the Representatives to securities dealers who resell our common stock to online brokerage account holders. Other than the prospectus in electronic format, the information on the Representatives' website and any information contained in any other website maintained by the Representatives is not part of the prospectus or the registration statement of which this prospectus forms a part, has not been approved and/or endorsed by us or the Representatives in its capacity as Representatives and should not be relied upon by investors.

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**Selling Restrictions**

No action has been taken in any jurisdiction (except in the United States) that would permit a public offering of our common stock, or the possession, circulation or distribution of this prospectus or any other material relating to us or our common stock, where action for that purpose is required. Accordingly, our common stock may not be offered or sold, directly or indirectly, and neither this prospectus nor any other offering material or advertisements in connection with our common stock may be distributed or published, in or from any country or jurisdiction except in compliance with any applicable rules and regulations of any such country or jurisdiction.

**Offer Restrictions Outside the United States**

Other than in the United States, no action has been taken by us or the underwriters that would permit a public offering of the securities offered by this prospectus in any jurisdiction where action for that purpose is required. The securities offered by this prospectus may not be offered or sold, directly or indirectly, nor may this prospectus or any other offering material or advertisements in connection with the offer and sale of any such securities be distributed or published in any jurisdiction, except under circumstances that will result in compliance with the applicable rules and regulations of that jurisdiction. Persons into whose possession this prospectus comes are advised to inform themselves about and to observe any restrictions relating to this offering and the distribution of this prospectus. This prospectus does not constitute an offer to sell or a solicitation of an offer to buy any securities offered by this prospectus in any jurisdiction in which such an offer or a solicitation is unlawful. In particular, our common stock has not been qualified for distribution by prospectus in Canada and may not be offered or sold in Canada during the course of their distribution hereunder except pursuant to a Canadian prospectus or prospectus exemption.

**LEGAL MATTERS**

Brunson Chandler & Jones, PLLC, has acted as our counsel in connection with the preparation of this prospectus. The validity of the securities offered, shares of common stock, and warrants covered by this prospectus will be passed upon for us by Brunson Chandler & Jones, PLLC. The underwriters have been represented in connection with this offering by Bevilacqua PLLC.

**EXPERTS**

The financial statements of our company included in this registration statement and have been audited by dbbmckennon, an independent registered public accounting firm, as indicated in its report with respect thereto, and have been so included in reliance upon the report of such firm given on the authority of said firm as experts in accounting and auditing.

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| 66 |
| *[**Table of Contents**](#toc)* |

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**WHERE YOU CAN FIND MORE INFORMATION**

We have filed a registration statement, of which this prospectus is a part, on Form S-1 with the SEC relating to this offering. This prospectus does not contain all of the information in the registration statement and the exhibits included with the registration statement. For further information pertaining to us and the securities to be sold in this offering, you should refer to the registration statement and its exhibits, portions of which have been omitted as permitted by SEC rules and regulations. References in this prospectus to any of our contracts, agreements or other documents are not necessarily complete, and you should refer to the exhibits attached to the registration statement for copies of the actual contracts, agreements or documents. You may read and copy the registration statement, the related exhibits and other material we file with the SEC at the SEC's public reference room in Washington, D.C. at 100 F Street, Room 1580, N.E., Washington, D.C. 20549. You can also request copies of those documents, upon payment of a duplicating fee, by writing to the SEC. Please call the SEC at 1-800-SEC-0330 for further information on the operation of the public reference rooms. The SEC also maintains an internet site that contains reports, proxy and information statements and other information regarding issuers that file with the SEC. The website address is http://www.sec.gov.

Upon the effectiveness of the registration statement, we will be subject to the informational requirements of the Exchange Act, and, in accordance with the Exchange Act, will file reports, proxy and information statements and other information with the SEC. Such annual, quarterly and special reports, proxy and information statements and other information can be inspected and copied at the locations set forth above. We also anticipate making these documents publicly available, free of charge, on our website at https://hempaccoinc.com/ as soon as reasonably practicable after filing such documents with the SEC. Information on, or accessible through, our website is not part of this prospectus.

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| 67 |
| *[**Table of Contents**](#toc)* |

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**HEMPACCO CO., INC.**

**(FORMERLY THE HEMPACCO CO., INC.)**

**INDEX TO CONSOLIDATED FINANCIAL STATEMENTS**

---

| | |
|:---|:---|
|  | **Page** |
| [Report of Independent Registered Public Accounting Firm](#re) | F-2 |
| [Consolidated Balance Sheets at December 31, 2021 and 2020](#bs) | F-3 |
| [Consolidated Statements of Operations for the years ended December 31, 2021 and 2020](#op) | F-4 |
| [Consolidated Statements of Stockholders' Equity for the years ended December 31, 2021 and 2020](#eq) | F-5 |
| [Consolidated Statements of Cash Flows for the years ended December 31, 2021 and 2020](#cf) | F-6 |
| [Notes to the Consolidated Financial Statements](#note) | F-7 |
| [Condensed Consolidated Balance Sheets at September 30, 2022 and December 31, 2021](#bs2) | F-21 |
| [Condensed Consolidated Statements of Operations for the three months and nine months ended September 30, 2022 and 2021](#soi2) | F-22 |
| [Condensed Consolidated Statements of Stockholders' Equity as of September 30, 2022 and 2021](#sse2) | F-23 |
| [Condensed Consolidated Statements of Cash Flows for the nine months ended September 30, 2022 and 2021](#scf2) | F-24 |
| [Notes to the Condensed Consolidated Financial Statements](#n2) | F-25 |

---

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| |
|:---|
| F-1 |
| *[**Table of Contents**](#TOCFS)* |

---

**REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**

To the Board of Directors and

Stockholders of Hempacco Co., Inc.

**Opinion on the Financial Statements**

We have audited the accompanying consolidated balance sheets of Hempacco Co., Inc. (the "Company") as of December 31, 2021 and 2020, the related consolidated statements of operations, stockholders' equity, and cash flows, for the years then ended and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of December 31, 2021 and 2020, and the results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America.

**Basis for Opinion**

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion.

Our audit included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audit provides a reasonable basis for our opinion.

**Going Concern**

The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the financial statements, the Company has suffered recurring losses from operations and has used cash in operating activities, which raises substantial doubt about its ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 1. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

**Critical Audit Matters**

The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of the critical audit matter does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing separate opinions on the critical audit matter or on the accounts or disclosures to which it relates.

**Revenue Recognition**

Description of the Matter:

As disclosed in Note 2 and 11, the Company recognizes revenue when or as the Company satisfies a customer agreement performance obligation by transferring control of a product or service to a customer, in an amount that reflects the consideration the Company expects to receive in exchange for those products or services. In determining revenue recognition for certain customer agreements, significant judgment was exercised by the Company, and included the following: 1) An assessment of the products and services promised in contracts or customer agreements, and the identification of a performance obligation for each promise to transfer to the customer a product or service that is distinct. 2) Determination of relative standalone selling price for distinct performance obligations. 3) The timing of product or service delivery for performance obligations. Given these factors, the related audit effort in evaluating management's judgments in determining revenue recognition for these customer agreements was extensive, which led us to determine this as a critical audit matter

How We Addressed the Matter in our Audit:

Our principal audit procedures related to the Company's revenue recognition for these customer agreements included an evaluation of the controls related to the identification of distinct performance obligations and the determination of the timing of revenue recognition. We also evaluated management's significant accounting policies related to certain customer agreements. In addition, we selected customer agreements and performed the following procedures: 1) Obtained and read the customer agreements or contracts for each selected agreement. 2) Evaluated and tested management's identification of significant terms for completeness, including the identification of distinct performance obligations. 3) Evaluated the appropriateness of management's application of their accounting principles, in their determination of revenue recognition conclusions. 4) Tested he mathematical accuracy of management's calculations of revenue and the associated timing of revenue recognized in the financial statements.

/s/ dbb*mckennon*

PCAOB #3501

We have served as the Company's auditors since 2021

San Diego, California

March 23, 2022

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|:---|
| F-2 |
| *[**Table of Contents**](#TOCFS)* |

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---

| |
|:---|
| **Hempacco Co., Inc.** |
| **(Formerly The Hempacco Co., Inc.)** |
| **CONSOLIDATED BALANCE SHEETS** |

---

---

| | | |
|:---|:---|:---|
|  | **December 31,**<br>**2021** | **December 31,**<br>**2020** |
| **ASSETS** |  |  |
| **Current Assets** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Cash | $933469 | $500 |
| &nbsp;&nbsp;&nbsp;&nbsp;Accounts Receivable – Related Parties | 137297 | 5587 |
| &nbsp;&nbsp;&nbsp;&nbsp;Accounts Receivable | 144246 | 10390 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Less: Receivables Impairment Allowance |  | (10290) |
| &nbsp;&nbsp;&nbsp;&nbsp;Inventory at Cost Less Obsolescence Allowance | 198936 | 92699 |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits & Prepayments | 703690 | 2576 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total Current Assets** | 2117638 | 101462 |
| **Property and Equipment** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Leasehold Improvements | 12431 | 12431 |
| &nbsp;&nbsp;&nbsp;&nbsp;Furniture, Fixtures & Equipment | 5147693 | 5067730 |
| &nbsp;&nbsp;&nbsp;&nbsp;Accumulated Depreciation | (161353) | (74852) |
| **Total Property and Equipment** | 4998771 | 5005309 |
| **Other Assets** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Operating Lease – Right of Use Asset | 642752 | 642752 |
| &nbsp;&nbsp;&nbsp;&nbsp;Right of Use Assets – Accumulated Amortization | (188638) | (91629) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total Other Assets** | 454114 | 551123 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total Assets** | $7570523 | $5657894 |
| **LIABILITIES AND STOCKHOLDERS' EQUITY**  |  |  |
| Current Liabilities |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Accounts Payable & Accrued Expenses | $97800 | $70828 |
| &nbsp;&nbsp;&nbsp;&nbsp;Accounts Payable – Related Parties | 162405 | 425817 |
| &nbsp;&nbsp;&nbsp;&nbsp;Accrued Interest on Long Term Notes | 9416 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Long Term Promissory Notes Payable | 175000 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Customer Pre-paid Invoices & Deferred Revenue | 2128393 | 756971 |
| &nbsp;&nbsp;&nbsp;&nbsp;Loans Payable – Related Parties | 9600 | 26600 |
| &nbsp;&nbsp;&nbsp;&nbsp;Equipment Loan | 1482681 | 1469535 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other Short-Term Loans |  | 85000 |
| &nbsp;&nbsp;&nbsp;&nbsp;Operating Lease – Right of Use Liability – Short Term Portion | 102969 | 97010 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total Current Liabilities** | 4168264 | 2931761 |
| Long Term Liabilities |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Other Long-Term Loans | 168328 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Long Term Promissory Notes Payable |  | 11500 |
| &nbsp;&nbsp;&nbsp;&nbsp;Long Term Promissory Notes Payable – Related Parties |  | 25000 |
| &nbsp;&nbsp;&nbsp;&nbsp;Accrued Interest on Long Term Notes |  | 3590 |
| &nbsp;&nbsp;&nbsp;&nbsp;Right of Use Liability – Straight-Line Rent Rule – Deferred Rent | 15126 | 9362 |
| &nbsp;&nbsp;&nbsp;&nbsp;Right of Use Liability – Long Term Portion | 351145 | 454113 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total Long-Term Liabilities** | 534599 | 503565 |
| &nbsp;&nbsp;&nbsp;&nbsp;**Total Liabilities** | 4702863 | 3435326 |
| **Stockholders' Equity** |  |  |
| Preferred stock, $0.001 and $0.01 par value as of December 31, 2021 and 2020 respectively; 50,000,000 shares and 20,000,000 shares authorized as of December 31, 2021 and 2020 respectively. 10,000,000 shares designated as Series A Preferred Stock as of December 31, 2021 and December 31, 2020 respectively.  |  |  |
| Series A Preferred stock, $0.001 and $0.01 par value as of December 31, 2021 and 2020 respectively; 50,000,000 and 20,000,000 shares authorized as of December 31, 2021 and 2020 respectively. 0 shares and 8,000,000 issued and outstanding as of December 31, 2021 and 2020 respectively.  |  | 3638357 |
| Common stock, $0.001 and $0.01 par value as of December 31, 2021 and 2020 respectively; 200,000,000 and 20,000,000 shares authorized as of December 31, 2021 and 2020 respectively. 19,695,532 and 8,478,000 shares issued and outstanding as of December 31, 2021 and 2020 respectively.  | 19696 | 84780 |
| Additional Paid in Capital | 6321428 | 102220 |
| &nbsp;&nbsp;&nbsp;&nbsp;Accumulated Deficit | (3459214) | (1602789) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Total Stockholders' Equity** | 2881910 | 2222568 |
| &nbsp;&nbsp;&nbsp;&nbsp;Non-Controlling Interests | (14250) | - |
| **Total Equity for Hempacco Co., Inc.** | 2867660 | 2222568 |
| **Total Liabilities and Stockholders' Equity** | $7570523 | $5657894 |

---

The accompanying notes are an integral part of these Consolidated Financial Statements

---

| |
|:---|
| F-3 |
| *[**Table of Contents**](#TOCFS)* |

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**Hempacco Co., Inc.**

**(Formerly The Hempacco Co., Inc.)**

**CONSOLIDATED STATEMENT OF OPERATIONS** 

---

| | | |
|:---|:---|:---|
|  | **For the**<br>**Year**<br>**Ended**<br>**December 31,**<br>**2021** | **For the**<br>**Year**<br>**Ended**<br>**December 31,**<br>**2020** |
| **Revenue** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Sale of Materials | $**805969** | $135867 |
| &nbsp;&nbsp;&nbsp;&nbsp;Sale of Materials – Related Parties | **139114** | 64290 |
| &nbsp;&nbsp;&nbsp;&nbsp;White Label Production & Consulting | **242190** | 145832 |
| **Total Revenue** | **1187273** | 345989 |
| **Cost of Goods Sold (including inventory obsolescence of $623,375 in 2020)** | **850901** | 899699 |
| **Gross Profit / (Loss) from Operations** | **336372** | (553710) |
| **Expenses** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;General & Administrative | **981676** | 303682 |
| &nbsp;&nbsp;&nbsp;&nbsp;General & Administrative – Related Parties | **469259** | 420000 |
| &nbsp;&nbsp;&nbsp;&nbsp;Sales & Marketing | **542680** | 27597 |
| &nbsp;&nbsp;&nbsp;&nbsp;Research & Development | **2090** | - |
| **Total Expenses** | **1995705** | 751279 |
| **Operating Loss** | **(1659333)** | (1304989) |
| **Other Income / (Expenses)** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest expense | **(209676)** | (160423) |
| &nbsp;&nbsp;&nbsp;&nbsp;Other Expenses | **(1666)** | (32) |
| **Total Other Expenses** | **(211342)** | (160455) |
| **Net Loss** | **(1870675)** | (1465444) |
| &nbsp;&nbsp;&nbsp;&nbsp;Net Loss attributable to non-controlling interests | **14250** | - |
| **Net Loss attributable to Hempacco Co., Inc.** | **(1856425)** | (1465444) |
| &nbsp;&nbsp;&nbsp;&nbsp;Dividend issued to preferred stockholders | **(757479)** | - |
| **Net Loss attributable to common stockholders** | $**(2613904)** | $(1465444) |
| **PER SHARE DATA:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;*Earnings per common share – basic*  | $(0.18) | $(0.17) |
| *Weighted average & contingently issuable shares outstanding & dilutive* | 14641224 | 8440466 |

---

The accompanying notes are an integral part of these Consolidated Financial Statements

---

| |
|:---|
| F-4 |
| *[**Table of Contents**](#TOCFS)* |

---

 **Hempacco Co., Inc.**

**(Formerly The Hempacco Co., Inc.)**

**CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY**

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Series A Preferred** <br>**Shares** | **Stock $**<br>**Amnt @ Par** | **Common**<br>**Shares** | **Stock $**<br>**Amnt @ Par** | **Additional**<br>**Paid in** <br>**Capital** | **Accumulated**<br>**Deficit** | **Non-Controlling**<br>**Interests** | **Stockholders'**<br>**Equity** |
|  | - | $- | - | $- | $- | $- | $- | $- |
| **Balances – December 31, 2019** | 8000000 | 3638357 | 8400000 | 84000 | - | (137345) | - | 3585012 |
| Common stock issued with convertible notes |  |  | 50000 | 500 | 49500 |  |  | 50000 |
| Beneficial conversion feature |  |  |  |  | 25000 |  |  | 25000 |
| Conversion of notes payable and accrued interest |  |  | 28000 | 280 | 27720 |  |  | 28000 |
| Net loss | - | - | - | - | - | (1465444) | - | (1465444) |
| **Balances – December 31, 2020** | 8000000 | $3638357 | 8478000 | $84780 | $102220 | $(1602789) | $- | $2222568 |
| Convertible Notes Converted to Common Stock |  |  | 535053 | 5350 | 529703 |  |  | 535053 |
| Shares issued for Consulting Services |  |  | 100000 | 1000 | 99000 |  |  | 100000 |
| Dividend on Preferred Stock |  | 757479 |  |  | (757479) |  |  |  |
| Related Party Accounts Payable Converted to Common Stock |  |  | 525000 | 5250 | 519750 |  |  | 525000 |
| Preferred Stock Converted to Common Stock | (8000000) | (4395836) | 8757479 | 87575 | 4308261 |  |  |  |
| Discount on Promissory Note Due to Issuance of Warrants |  |  |  |  | 149831 |  |  | 149831 |
| Reduction of Par Value of Common Stock |  |  |  | (165559) | 165559 |  |  |  |
| Pre-IPO Common Share Issuance – Expense |  |  |  |  | (272435) |  |  | (272435) |
| Pre-IPO Common Share Issuance |  |  | 1300000 | 1300 | 1298700 |  |  | 1300000 |
| Issue of 100m Parent Company Warrants to Broker |  |  |  |  | 178318 |  |  | 178318 |
| Net Loss attributable to Non-controlling interests |  |  |  |  |  |  | (14250) | (14250) |
| Net Loss for the Year ended December 31, 2021 | - | - | - | - | - | (1856425) | - | (1856425) |
| **Balances – December 31, 2021** | 0 | $0 | 19695532 | $19696 | $6321428 | $(3459214) | (14250) | $2867660 |

---

The accompanying notes are an integral part of these Consolidated Financial Statements

---

| |
|:---|
| F-5 |
| *[**Table of Contents**](#TOCFS)* |

---

**Hempacco Co., Inc.**

**(Formerly The Hempacco Co., Inc.)**

**CONSOLIDATED STATEMENTS OF CASH FLOWS**

---

| | | |
|:---|:---|:---|
| **CASH FLOWS FROM OPERATING ACTIVITIES** | **For the**<br>**Year**<br>**Ended**<br>**December 31,**<br>**2021** | **For the**<br>**Year**<br>**Ended**<br>**December 31,**<br>**2020** |
| Net Loss | $**(1870675)** | $(1465444) |
| **Adjustments to reconcile net loss to net cash used in operating activities:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization | 86501 | 69519 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amortization of discount and shares issued with related party convertible notes | 180296 | **-** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Warrants issued in connection with commission agreement | 178317 | 154162 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Stock Based Compensation | 100000 | **-** |
| **Changes in Operating Assets and Liabilities** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Receivables | (155878) | (5687) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Related party receivables | (137297) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prepaids | (701114) | 30 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inventory  | (106237) | 546969 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable | 26972 | 471645 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Related party accounts payable | 261588 | 9900 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued liabilities | 35144 | 15624 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred revenues | 1371422 | 133596 |
| **Net Cash Used in Operating Activities:** | **(730961)** | (69686) |
| **CASH FLOWS FROM INVESTING ACTIVITIES:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Purchase of property and equipment | (79963) | (51431) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Net Cash Used in Investing Activities:** | **(79963)** | (51431) |
| **CASH FLOWS FROM FINANCING ACTIVITIES:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Proceeds from other short-term loans | 83328 | 85000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Advances from (repayments to) related parties | (17000) | (25000) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Proceeds from convertible notes payable | 650000 | 11500 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Proceeds from the sale of common stock | 1300000 | **-** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Offering costs paid in connection with sale of common stock | (272435) | 50000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**Net Cash Provided by Financing Activities** | **1743893** | 121500 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**CHANGE IN CASH & CASH EQUIVALENTS:** | 932969 | 383 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**CASH BALANCE AT BEGINNING OF PERIOD:** | 500 | 117 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**CASH BALANCE AT END OF PERIOD:** | $**933469** | $500 |
| **SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash Paid for Interest | $**-** | $**-** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Cash Paid for Taxes | $**-** | $38 |
| **NON-CASH INVESTING AND FINANCING ACTIVITIES:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Conversion of convertible notes payable and accrued interest to common stock | $535054 | $**-** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Warrants issued with Convertible note | $149831 | $**-** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Conversion of preferred stock into common stock | $4395836 | $**-** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Dividend on preferred stock recorded against additional paid-in capital | $757479 | $**-** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Related party accounts payable converted into common stock | $525000 | $**-** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Reduction of notes payable through products and services provided | $17319 | $**-** |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Beneficial conversion feature on related party convertible notes payable | $**-** | $25000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Initial recording of right of use asset and liability | $**-** | $642745 |

---

The accompanying notes are an integral part of these Consolidated Financial Statements

---

| |
|:---|
| F-6 |
| *[**Table of Contents**](#TOCFS)* |

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**HEMPACCO CO., INC.**

**(Formerly The Hempacco Co., Inc.)**

**Notes to the Consolidate Financial Statements**

**December 31, 2021 and 2020**

**NOTE 1 – ORGANIZATION, BUSINESS AND LIQUIDITY**

***Organization and Operations***

Hempacco Co., Inc., (the "Company" or "Hempacco" was incorporated in Nevada on April 1, 2019, as The Hempacco Co., Inc.

On April 23, 2021, the Company filed a second amendment to its Articles of Incorporation changing the name of the Company from The Hempacco Co., Inc. to Hempacco Co., Inc.

The Company was acquired by Green Globe International, Inc. ("GGII") on May 21, 2021, and became a wholly-owned subsidiary of GGII.

These financial statements are those of Hempacco Co., Inc and its subsidiaries only.

During 2021, the Company entered into the following Joint Ventures:

---

| | |
|:---|:---|
| a)  | On or about March 10, 2021, the Company entered into a joint venture partnership agreement with VZ Ventures and BX2SD Hospitality, LLC for the sale and marketing of a proprietary brand of smokables containing the D8 infused variety of hemp. Cali Vibes D8, LLC was formed as the entity's business vehicle which will be 50% owned by the Company. The Company will manage the business operations and accounting, as well as manufacturing the product and provide the majority of funding required. |
| b)  | On or about June 22, 2021, the Company's Parent Company, entered into a joint venture agreement with Hemp Hop Global, LLC, a Florida based company in the hip hop talent management business and the sale and distribution of branded snack food products. Hemp Hop Global is managed by Rick Ross, an American Rapper and record executive and his business partner James Lindsay. Hempacco will produce a range of smokable products under the Hemp Hop brand, and Hemp Hop Smokables, LLC was formed as the business entity, of which the Company owns 50%. The Company will manage the business operations and accounting of the entity, as well as manufacturing the product and provide the majority of funding required, and three of the five directors of the entity are nominees of the Company. |
|  | On December 14, 2021, GGII assigned all of the membership and other equity and ownership interests in Hemp Hop Smokables LLC to Hempacco., Co., Inc. |

---

Hempacco manufactures and distributes hemp smokables both under its own name and white label products for clients. Hempacco also owns high-tech CBD vending kiosks that it plans to place in retail venues throughout the US, in conjunction with a number of joint venture partners.

***Going Concern Matters***

The accompanying financial statements have been prepared in conformity with generally accepted accounting principles in the United States ("GAAP"), which contemplates the Company's continuation as a going concern. The Company incurred a net loss of $1,856,425 (exclusive of a $757,479 dividend distribution to preference shareholders – see Note 13) during the year ended December 31, 2021 and has an accumulated deficit of $3,473,464 as of December 31, 2021. In addition, the Company has a working capital deficit of $1,947,658 as of December 31, 2021 exclusive of a $102,969 "Right of Use Asset" liability which is offset by a Right of Use Asset in the Other Assets section of the Balance Sheet.

Management intends to raise additional operating funds through equity and/or debt offerings. However, there can be no assurance management will be successful in its endeavors.

---

| |
|:---|
| F-7 |
| *[**Table of Contents**](#TOCFS)* |

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There are no assurances that the Company will be able to either (1) achieve a level of revenues adequate to generate sufficient cash flow from operations; or (2) obtain additional financing through either private placement, public offerings and/or bank financing necessary to support its working capital requirements. To the extent that funds generated from operations and any private placements, public offerings and/or bank financing are insufficient, the Company will have to raise additional working capital. No assurance can be given that additional financing will be available, or if available, will be on terms acceptable to the Company. If adequate working capital is not available to the Company, it may be required to curtail or cease its operations.

Due to uncertainties related to these matters, there exists a substantial doubt about the ability of the Company to continue as a going concern. The accompanying financial statements do not include any adjustments related to the recoverability or classification of asset-carrying amounts or the amounts and classification of liabilities that may result should the Company be unable to continue as a going concern. If we are not able to successfully execute on our future operating plans, our financial condition and results of operation may be materially adversely affected, and we may not be able to continue as a going concern.

***COVID-19***

A novel strain of coronavirus (COVID-19) was first identified in December 2019, and subsequently declared a global pandemic by the World Health Organization on March 11, 2020. As a result of the outbreak, many companies have experienced disruptions in their operations and in markets served. The Company considered the impact of COVID-19 on the assumptions and estimates used and determined that there were no material adverse impacts on the Company's results of operations and financial position at December 31, 2021.

**NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES**

***Basis of Presentation***

The financial statements of the Company have been prepared in accordance with the Generally Accepted Accounting Principles of the United States ("GAAP") and are presented in US dollars.

***Principles of Consolidation***

The financial statements include the accounts of the Company and all of its wholly owned subsidiaries. All significant inter-company balances and transactions have been eliminated in consolidation.

Joint Venture entities where the company owns at least 51% and controls the accounting and administration of the entities will be accounted for under ASC 810-10 which will allow full consolidation of the assets and liabilities into the Company's balance sheet, with non-controlling interests being calculated and disclosed in the balance sheet and operating statement of the Company. Joint Venture entities where the company owns less than 51% are evaluated for treatment as variable interest entities. The Company may provide accounting and administration for these entities, may have board of director control, and may provide majority of funding for these entities. Any entities not falling within this criterion will be accounted for under ASC 323-30. These consolidated financial statements include the operating results and the assets of two joint venture entities that have been deemed variable interest entities for the period ended December 31, 2021. The non-controlling interests of these ventures have been disclosed on the consolidated balance sheet and income statement.

***Use of Estimates***

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Some of these judgments can be subjective and complex, and, consequently, actual results may differ from these estimates.

***Concentration of Credit Risk***

Financial instruments, which potentially subject us to concentrations of credit risk, consist principally of cash. Our cash balances are maintained in accounts held by major banks and financial institutions located in the United States. The Company occasionally maintains amounts on deposit with a financial institution that are in excess of the federally insured limit of $250,000. The risk is managed by maintaining all deposits in high quality financial institutions.

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| F-8 |
| *[**Table of Contents**](#TOCFS)* |

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***Revenue Concentration***

Sales to one of our customers made up approximately 41% of our revenues for the twelve months ended December 31, 2021, and the balance receivable from this customer at December 31, 2021 represents approximately 37% of the total accounts receivable balances of $281,543 as of that date. We do not have a binding purchase agreement with this customer, and were we to lose this customer, our revenues would significantly decline, and our business might be harmed.

***Cash and Cash Equivalents***

Cash and cash equivalents consist of cash and highly liquid investments with remaining maturities of less than ninety days at the date of purchase. We have not experienced any losses related to these balances, and we believe credit risk to be minimal. The Company does not have any cash equivalents.

***Accounts Receivable***

Accounts receivables are recorded in accordance with ASC 310, "Receivables." Accounts receivables are recorded at the invoiced amount and do not bear interest. The allowance for doubtful accounts is the Company's best estimate of the amount of probable credit losses in its existing accounts receivable. As of December 31, 2021, the Company reported no allowance for doubtful accounts, however a credit of $4,230 for previous doubtful accounts written off was booked during the year ended December 31, 2021. Based on the foregoing, and management's estimate and based on all accounts being current, the Company has deemed it unnecessary to reserve for doubtful accounts at this time. The Company had a reserve of $0 and $10,290 as of December 31, 2021 and 2020, respectively.

***Inventory***

Inventory is stated at the lower of cost and net realizable value on a first-in first-out basis. Net realizable value is the estimated selling price in the ordinary course of business less any applicable selling expenses. Cost includes all expenses directly attributable to the manufacturing process as well as suitable portions of related production overheads, based on normal operating capacity. The Company periodically reviews the value of items in inventory and provides write-downs or write-offs of inventory based on its assessment of market conditions, including forecasted demand compared to quantities on hand, as well as other factors such as potential excess or aged inventories based on product shelf life, and other factors that affect inventory obsolescence.

***Basic and Diluted Net Loss per Common Share***

Pursuant to ASC 260, "Earnings Per Share," basic net income and net loss per share are computed by dividing the net income and net loss by the weighted average number of common shares outstanding. Diluted net income and net loss per share is the same as basic net income and net loss per share when their inclusion would have an anti-dilutive effect due to our continuing net losses.

For the year ended December 31, 2021 and 2020, the following outstanding dilutive securities were excluded from the computation of diluted net loss per share as the result of the computation was anti-dilutive.

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| | | |
|:---|:---|:---|
|  | **December 31** | **December 31** |
|  | **2021**<br>**(Shares)** | **2020**<br>**(Shares)** |
| Series A Preferred Stock |  | 8000000 |
| Promissory Note convertible to shares | 50000 | 36500 |
| Outstanding Warrants | - | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;TOTAL | 50000 | 8036500 |

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| F-9 |
| *[**Table of Contents**](#TOCFS)* |

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***Leases***

We determine if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use ("ROU") assets, operating lease liabilities – current, and operating lease liabilities – noncurrent on the balance sheets. Finance leases are included in property and equipment, other current liabilities, and other long-term liabilities in our balance sheets.

ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. As our single lease does not provide an implicit rate, we have used our incremental borrowing rate ("IBR") based on the estimated rate of interest for collateralized borrowing over a similar term of the lease payments at commencement date.

The operating lease ROU asset also includes any lease payments made and excludes lease incentives. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for lease payments is recognized on a straight-line basis over the lease term.

***Long-Lived Assets***

Long-lived assets are evaluated for impairment whenever events or changes in business circumstances indicate that the carrying amount of the assets may not be fully recoverable or that the useful lives of these assets are no longer appropriate. Each impairment test is based on a comparison of the undiscounted future cash flows to the recorded value of the asset. If impairment is indicated, the asset is written down to its estimated fair value. The Company incurred no impairment of long-lived assets as of December 31, 2021 and 2020, respectively.

***Property and Equipment***

Property and equipment are stated at cost. Depreciation is computed using the straight-line method. The depreciation and amortization methods are designed to amortize the cost of the assets over their estimated useful lives, in years, of the respective assets as follows:

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| | |
|:---|:---|
| Kiosks | 5 years |
| Leasehold improvements | 6 years or shorter of lease life |
| Production Equipment | 20 years |

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Maintenance and repairs are charged to expense as incurred. Improvements of a major nature are capitalized. At the time of retirement or other disposition of property and equipment, the cost and accumulated depreciation are removed from the accounts and any gains or losses are reflected in income.

The kiosks that the Company acquired have not been placed into service as of December 31, 2021, thus depreciation has yet to commence. However, Kiosks used for demonstration and marketing purposes have been depreciated since January 1, 2021.

***Fair Value of Financial Instruments***

FASB ASC 820, *Fair Value Measurements and Disclosure*s ("ASC 820") establishes a framework for all fair value measurements and expands disclosures related to fair value measurement and developments. ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

ASC 820 requires that assets and liabilities measured at fair value are classified and disclosed in one of the following three categories:

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| Level 1*—*Quoted market prices for identical assets or liabilities in active markets or observable inputs. |
| Level 2*—*Significant other observable inputs that can be corroborated by observable market data; and |
| Level 3*—*Significant unobservable inputs that cannot be corroborated by observable market data. |

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| F-10 |
| *[**Table of Contents**](#TOCFS)* |

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The carrying amounts of cash, accounts receivable, accounts receivable – related parties, inventory, deposits and prepayments, accounts payable and accrued liabilities, accounts payable – related parties, customer pre-paid invoices & deposits, other short-term liabilities – equipment loan, operating lease – right of use liability – short term portion approximate fair value because of the short-term nature of these items.

***Share-Based Compensation***

The Company accounts for share-based compensation in accordance with ASC 718, "Compensation – Stock Compensation," which requires all such compensation to employees and non-employees, including the grant of employee stock options, to be calculated based on its fair value at the measurement date (generally the grant date), and recognized in the statement of operations over the requisite service period or as vesting occurs.

The Company recorded $100,000 and $0 in share-based compensation expense for the years ended December 31, 2021 and 2020, respectively.

***Income Taxes***

The Company accounts for income taxes using the asset and liability method in accordance with ASC 740, "Accounting for Income Taxes". The asset and liability method provides that deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities and for operating loss and tax credit carry forwards. Deferred tax assets and liabilities are measured using the currently enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company records a valuation allowance to reduce deferred tax assets to the amount that is believed more likely than not to be realized.

As of December 31, 2021 and 2020, the Company did not have any amounts recorded pertaining to uncertain tax positions.

***Advertising and Marketing Costs***

Costs associated with advertising and marketing promotions are expensed as incurred. Advertising and marketing expense was $542,680 and $27,597 for the years ended December 31, 2021 and 2020, respectively.

***Revenue Recognition***

The Company recognizes revenue in accordance with ASC 606, Revenue from Contracts with Customers. The Company generally earns its revenue by supplying goods or providing services under contracts with its customers in two primary revenue streams: manufacturing and commercial product supply and white label development services. The Company measures the revenue from customers based on the consideration specified in its contracts, or the value of the amount invoiced should the initial order be a basic purchase order or emailed order.

The Company recognizes revenue from customers when control of the goods or services are transferred to the customer, generally when products are shipped, at an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods.

Per Company policy, any product that doesn't meet the customer's expectations can be returned within the first 30 days of delivery in exchange for another product or for a full refund. Any product sold through a distributor or retailer must be returned to the original purchase location for any return or exchange. For the years ended December 31, 2021 and 2020, the Company has not recorded any reserves on revenue.

The majority of the Company's revenue is derived from sales of branded products to consumers via our direct-to-consumer (DTC) ecommerce website, distributors, and retail and wholesale "white label" business-to-business (B2B) customers.

For larger orders, the Company requires the customer to make a deposit equal to 50% of the invoice or order total which is recorded as customer prepaid invoices and deferred revenue on the balance sheet. When the product is shipped the customer deposit is recorded into revenue. The Company recorded $1,505,018 and $133,596 in customer pre-paid invoices and deposits for goods ordered but not delivered, as of December 31, 2021 and 2020, respectively.

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| F-11 |
| *[**Table of Contents**](#TOCFS)* |

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In 2019, the Company entered into an arrangement with a customer whereby the Company was provided with product from the customer for the Company's and the customer's use. Under the arrangement, 50% of the product provided by the customer was to compensate the Company for their services for processing and packaging the customers remaining 50% share. The transaction was recorded at the fair market value of the inventory received, which was similar to the cost of the services to which were to be provided with an increase of $623,375 to inventory and customer deposits. As of December 31, 2021 and 2020, the customer deposit liability of $623,375 remained. The Company will defer revenue on customer deposits and record as revenue once product is delivered.

***Non-Controlling Interests***

The Company accounts for the non-controlling interests in its subsidiaries and joint ventures in accordance with U.S. GAAP.

The Company has chosen to record the Minority interests (NCI's) in the equity section of the balance sheet, and on the income statement, the profit or loss attributable to the minority interest will be reported as a separate non-operating line item.

The Company measures its NCI's using the percentage of ownership interest held by the respective NCI's during the accounting period. For the year ended December 31, 2021 the Company reported a minority interest in its accumulated losses of $14,250. No net assets were held by the NCI's as of December 31, 2021.

***Recent Accounting Pronouncements***

In December 2019, the Financial Accounting Standards Board (FASB) issued Accounting Standard Update No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (ASU 2019-12), which simplifies the accounting for income taxes. This guidance will be effective for entities for the fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020 on a prospective basis, with early adoption permitted. We adopted the new standard effective January 1, 2021 and do not expect the adoption of this guidance to have a material impact on our financial statements.

In August 2020, the FASB issued ASU 2020-06, ASC Subtopic 470-20 "Debt—Debt with "Conversion and Other Options" and ASC subtopic 815-40 "Hedging—Contracts in Entity's Own Equity". The standard reduced the number of accounting models for convertible debt instruments and convertible preferred stock. Convertible instruments that continue to be subject to separation models are (1) those with embedded conversion features that are not clearly and closely related to the host contract, that meet the definition of a derivative, and that do not qualify for a scope exception from derivative accounting; and, (2) convertible debt instruments issued with substantial premiums for which the premiums are recorded as paid-in capital. The amendments in this update are effective for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020, including interim periods within those fiscal years.

The Company has reviewed all other recently issued, but not yet effective, accounting pronouncements and does not believe the future adoption of any such pronouncements may be expected to cause a material impact on our financial statements.

**NOTE 3 – ACCOUNTS RECEIVABLE** 

As of December 31, 2021 and 2020, accounts receivable consisted of the following:

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| | | |
|:---|:---|:---|
|  | **December 31,**<br>**2021** | **December 31,**<br>**2020** |
| Accounts receivable | $144246 | $10390 |
| Accounts receivable – related parties\* | 137297 | 5587 |
| Allowance for doubtful accounts | - | (10290) |
| Total accounts receivable | $281543 | $5687 |

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\* Due from UST Mexico, Inc. for Hemp products (70%) and manufacturing services (30%)

See Note 11 for additional information on related party transactions related to receivables.

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| F-12 |
| *[**Table of Contents**](#TOCFS)* |

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**NOTE 4 – INVENTORY**

As of December 31, 2021 and 2020, inventory, which consists primarily of the Company's raw materials, finished products and packaging is stated at the following amounts:

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| | | |
|:---|:---|:---|
|  | **December 31,**<br>**2021** | **December 31,**<br>**2020** |
| Finished goods | $41088 | $11111 |
| Raw materials (Net of obsolescence allowance) | 157848 | 81588 |
| Total inventory at cost less obsolescence allowance | $198936 | $92699 |

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The Company identified a potential for obsolescence in particular raw materials and provided an allowance for this risk in full in the year ended December 31, 2020 which was recorded within cost of goods sold in the amount of $623,375. This obsolescence allowance is continually re-evaluated and adjusted as necessary.

**NOTE 5 – PROPERTY AND EQUIPMENT**

See Note 10 for further information concerning the acquisition of kiosks.

As of December 31, 2021 and 2020, property and equipment consisted of the following:

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| | | |
|:---|:---|:---|
|  | **December 31,**<br>**2021** | **December 31,**<br>**2020** |
| Production equipment  | $1461586 | $1390373 |
| Leasehold improvements | 12431 | 12431 |
| Kiosks plus Improvements | 3686107 | 3677357 |
| Less accumulated depreciation | (161353) | (74852) |
| Total property and equipment | $4998771 | $5005309 |

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Depreciation expense totaled $86,501 and $69,519 for the years ended December 31, 2021 and 2020, respectively.

**NOTE 6 – OPERATING LEASE – RIGHT OF USE ASSET**

The Company entered into a 60-month lease to lease approximately 5,000 square feet of office space on January 1, 2020 for a period of 6 years with a related party, an entity controlled by the Company's CEO. Approximately 3,000 sf is used as a manufacturing facility with the balance used as corporate offices and storage. There was no security deposit paid, and the lease carries no optional extension periods. The term of the lease is for six years. At inception of the lease, the Company recorded a right of use asset and liability. The Company used an effective borrowing rate of 6.232% within the calculation.

Base monthly rent commenced at $10,000 per month, with subsequent defined annual increases. All operating expenses are born by the lessee. Amounts payable to the related party for rent as of December 31, 2021 and 2020 were $0 and $116,940 respectively. On December 31, 2021 an amount of $14,764 of prepaid rent was included in the deposits and prepayments account.

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| F-13 |
| *[**Table of Contents**](#TOCFS)* |

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Operating lease right-of-use ("ROU") assets and liabilities are recognized at commencement date based on the present value of lease payments over the lease term. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Generally, the implicit rate of interest in arrangements is not readily determinable and the Company utilizes its incremental borrowing rate in determining the present value of lease payments. The Company's incremental borrowing rate is a hypothetical rate based on its understanding of what its credit rating would be. The operating lease ROU asset includes any lease payments made and excludes lease incentives. Our variable lease payments primarily consist of maintenance and other operating expenses from our real estate leases. Variable lease payments are excluded from the ROU assets and lease liabilities and are recognized in the period in which the obligation for those payments is incurred. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term.

The following are the expected lease payments as of December 31, 2021. The lease is considered an "operating lease" and consequently lease payments are calculated on a straight-line basis, including the total amount of interest related.

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| | |
|:---|:---|
| **Year Ending December 31** | **Operating Leases** |
| 2022 | $129362 |
| 2023 | 129362 |
| 2024 | 129362 |
| 2025 | 129362 |
| Total lease payments | 517448 |
| Less: Imputed interest/present value discount | (63334) |
| Total | $454114 |

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Lease expense, on the straight-line basis was $129,362 during the years ended December 31, 2021 and 2020.

**NOTE 7 – OTHER SHORT-TERM LIABILITIES – EQUIPMENT LOAN**

On December 11, 2019, the Company entered into a short-term loan for equipment to use in its production. The terms of the loan were, $1,500,000 over 18 months with zero interest, which necessitated the calculation of an imputed discount of $109,627, which was being amortized over 18 months. During the year ended December 31, 2021, the Company amortized the remaining discount of $30,465 to interest expense. The balance on the note was $1,482,681 as of December 31, 2021, having been reduced by the application of $17,319 of accounts receivable due from, and with the agreement of, the lender.

The loan is secured by the equipment, and the lender recently agreed to repayments of $50,000 per month, interest free, which would take approximately thirty months to retire the loan, assuming no additional paydowns were made by supplying smokable products. As of December 31, 2021 and 2020, the principle balance of the loan was $1,482,681 and $1,500,000, respectively.

As of December 31, 2020, a balance of $30,465 of unamortized loan discount was deducted from the loan balance.

Please refer to Note 14 for additional information.

**NOTE 8 – CONVERTIBLE NOTES**

During the year ended December 31, 2021, Hempacco issued twelve convertible promissory notes totaling $650,000 and warrants to purchase up to 750,000 shares of Hempacco common stock at $1.00 per share were issued to two related party members of the Board of Directors. Subsequently, as a result of the merger and share exchange agreement of May 21, 2021 between Hempacco and Green Globe International, Inc. these warrants were cancelled and replaced on November 9, 2021 with equivalent warrants to purchase Green Globe common shares. See Note 9 below for additional details.

Individual note holders converted $511,500 in principle and $23,552 in accrued interest into 535,052 shares of Hempacco common stock. On May 21, 2021, these shares were exchanged for 2,236,213,775 of GGII's common shares.

On February 17, 2020, the Company entered into a financing arrangement with a related party (Jerry Halamuda, a Board of Directors member, to provide working capital. The Company received proceeds of $50,000. An additional 25,000 shares were offered as an inducement which created a beneficial conversion feature of $25,000, which was charged to interest expense over the term of the loan. The terms of this loan were three months with zero interest rate, maturing on May 17, 2020. On May 17, 2020 Hempacco issued 25,000 shares as an inducement to extend the loan for three months until August 17, 2020. The Company incurred an interest expense of $25,000 in connection with this inducement.

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| F-14 |
| *[**Table of Contents**](#TOCFS)* |

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On June 30, 2020, Hempacco repaid $25,000 of the principal on the note. As of December 31, 2020, the balance on the note was $25,000. The Note was convertible into common shares on a $1 for $1 basis. The Note was converted on May 21, 2021 in the total amount of $25,000 inclusive of accrued interest for 25,000 Hempacco shares.

On February 16, 2021, the Company entered into a financing arrangement with a related party (Dr. Stuart Titus, a Board of Directors member, to provide working capital. Hempacco received proceeds of $50,000. The terms of this loan were one year and annual interest rate was 8%, maturing on February 15, 2022. The Note was convertible into common shares on a $1 for $1 basis. The Note was converted on May 21, 2021 in the total amount of $51,030 inclusive of accrued interest of $1,030 for 51,030 Hempacco shares.

On July 23, 2020, the Company entered into a financing arrangement to provide working capital. Hempacco received proceeds of $11,500. The terms of this loan were one year and annual interest rate was 12%, maturing on July 23, 2021. As of December 31, 2020, the balance on the note was $11,500. In addition, $590 of interest had been accrued as of December 31, 2020. The Note was convertible into common shares on a $1 for $1 basis. The Note was converted on May 21, 2021 in the total amount of $12,623 inclusive of accrued interest of $1,123 into 12,623 Hempacco shares.

During May and June 2021, the Company entered into financing arrangements to provide working capital. Hempacco received proceeds of $175,000 from three private investors. The promissory notes carried interest at the rate of between 8% and 12% and mature between May 4, 2022 and October 23, 2022. The Notes automatically convert at 75% of the 30-day average bid price of the obligor common stock (or the public company common stock as the case may be), with the exception of the $50,000 Taverna 12% Note which converts at $1.00 per share or the current market price of Hempacco stock. The Notes cannot be converted prior to maturity. The Taverna Note matured on November 4, 2021 and has been extended to May 4, 2022 by mutual agreement.

**NOTE 9 – WARRANTS**

The 750,000 Hempacco warrants issued to Jerry Halamuda and Dr. Stuart Titus in February 2021 were effectively cancelled on May 21, 2021, as a result of the merger and share exchange between Hempacco and Green Globe International, Inc. but not re-issued by Green Globe International, Inc. until November 11, 2021. The total number of replacement warrants issued was 27,173,925 at a strike price of $.027600 which is the equivalent of 750,000 warrants exercisable at $1.00 each.

A Black-Scholes valuation discount of $149,831 was initially recorded. The discount was amortized over the warrant term with the balance remaining at the conversion date being expensed to interest. No further expense was incurred as a result of the modifications of the warrants to GGII warrants. The valuation discount represents the fair market value as derived by using the Black-Scholes formula, which produced an initial valuation of the Hempacco warrants of $0.4986 per share. The Black-Scholes formula applied to the GGII warrants on June 9, 2021 produced a valuation of $.0138 per share.

The Black-Scholes model uses the following variables to calculate the value of an option or warrant:

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| | |
|:---|:---|
| **Description**  | **Input Range** |
| a) Price of the Issuer's Security  | $1.00 - $2.00 |
| b) Exercise (strike) price of Security  | $0.75 - $1.50 |
| c) Time to Maturity in years  | 3 to 5 years |
| d) Annual Risk-Free Rate  | 2-year T-Bill |
| e) Annualized Volatility (Beta)  | 25% - 75% |

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On August 11, 2021, the Company signed an agreement with Boustead Securities, LLC (the "Representative"), which was amended on or about March 18, 2022, effective as of August 11, 2021, with respect to a number of proposed financing transactions, including the initial public offering ("IPO") of the Company's common stock for which a listing on NASDAQ has been applied for, the private placement of Company securities prior to the IPO ("pre-IPO Financings"), and other financings separate from the IPO or the pre-IPO Financings (each such other financing an "Other Financing"). See Note 13 below for further details.

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| F-15 |
| *[**Table of Contents**](#TOCFS)* |

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In addition to the other compensation delineated in the agreement, the Company agreed to issue and sell to the Representative (and/or its designees) on the closing date of an IPO or Other Financing as applicable, five-year warrants to purchase shares of Company common stock equal to 7% of the gross offering amount, at an initial exercise price of 150% of the offering price per share in the IPO, or 100% of the offering price in an Other Financing.

On November 23, 2021, the Company entered into a Broker Representation Agreement with a third-party sales agent, whereby the sales broker would receive a commission of 10% on any net product sales brought to the Company by their efforts or introductions. In particular, as a bonus for introducing a major client, the broker was to be granted 100,000,000 warrants to purchase common stock of Green Globe International, Inc., exercisable at $0.01 each for a period of three years.

The Black-Scholes valuation of the 100,000,000 warrants as of the contract date is $0.0018 per share for a total valuation of $178,317 which has been recorded as a one-time charge to the income statement due to there being no future performance obligations with respect to the Company arising from this warrant award.

See Note 14 for additional issuances of warrants.

**NOTE 10 – LOAN PAYABLE**

On June 15, 2020, the Company entered into a loan agreement with a third party whereby the Company received $85,000. The terms of the loan was for one year, with 0% interest. On January 15, 2021, the lender advanced a further $83,328 on the same terms. In December 2021 a letter agreement and loan extension was signed by the lender in which it was confirmed that the new maturity date of the loan would be August 15, 2023. The lender also confirmed that $41,000 of the original loan principal had not yet been extended. As of December 31, 2021 the balance outstanding was $168,328. The same customer advanced a deposit of $40,000 for the purchase of 10 kiosks which were delivered in February 2022.

**NOTE 11 – RELATED PARTY TRANSACTIONS**

As of December 31, 2021, the Company had entered into the following transactions with Related Parties:

On October 22, 2019, the Company entered in to a Kiosk Acquisition Agreement with Mexico Franchise Opportunities Fund LP ("MFOF") to purchase 600 Vending Kiosks for total consideration of $3,638,357 payable by the issuance of 8,000,000 Series A Preferred Shares. Due to the related party status of MFOF, whereby the entities were under common control, the Company used the carryover basis of accounting. Thus the 600 Kiosks were recorded at net book value of $3,638,357 upon acquisition.

With the exception of kiosks that are used for marketing and demonstration purposes, no depreciation expense is charged until the kiosks are placed in service. As of December 31, 2021 no kiosks, other than placed for marketing purposes, had yet been placed in service.

In May 2021, Cube17, Inc., a related party sales and marketing consulting company, converted all outstanding consulting fees earned since the inception of Hempacco in the amount of $185,000 for 185,000 shares of Hempacco common stock, for $1 per share. On May 21, 2021, these shares were exchanged for 707,113,562 common shares of Green Globe International, Inc. Consulting expenses of $120,000 and $120,000 were recorded for the years ended December 31, 2021 and 2020. Consulting fee balances payable were $63,404 and $135,000 as of December 31, 2021, and 2020.

In addition, Cube17, Inc., as a founder of Hempacco, converted its 400,000 founders shares into 1,528,997,476 common shares of Green Globe International, Inc.

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| F-16 |
| *[**Table of Contents**](#TOCFS)* |

---

In May of 2021, Primus Logistics was issued 170,000 common shares of Hempacco as compensation for $170,000 of accrued and unpaid rent owed at that time by Hempacco from inception. On May 21, 2021, these shares were exchanged for 649,780,985 common shares of the Company. Hempacco CEO, Sandro Piancone, is the 90% owner of Primus Logistics which is considered a related party. Rent Expenses are reported in Note 6 above.

As of December 31, 2021 and 2020, the Company owed Primus Logistics $0 and $116,940 respectively, for routine business transactions. As of December 31, 2021 Primus Logistics had been paid $14,764 in advance for rent. Sandro Piancone is the 90% owner of Primus Logistics.

In May of 2021, Strategic Global Partners, Inc. was issued 170,000 Hempacco common shares as compensation for $170,000 worth of consulting services incurred since Hempacco's inception by the CEO, Sandro Piancone, President and Owner of Strategic Global. On May 21, 2021, these shares were exchanged for 649,780,985 common shares of Green Globe International, Inc. Strategic Global Partners is a related party. Consulting expenses of $120,000 and $120,000 were recorded for the years ended December 31, 2021 and 2020. Unpaid consulting fee balances of $70,000 and $120,000 were outstanding as of December 31, 2021 and 2020, respectively.

As of December 31, 2021 and December 31, 2020, the Company owed $29,000 and $53,877 and was owed $132,147 and $0, respectively, by UST Mexico, Inc. ("UST"). Hempacco sells hemp products to UST and also provides manufacturing consulting services. The value of goods and services provided to UST Mexico, Inc was $152,147 and $62,174 for the years ended December 31, 2021 and 2020 respectively, and the value of goods and services provided by UST Mexico, Inc. was $251,000 and $205,127 for the years ended December 31, 2021 and 2020 respectively. UST Mexico, Inc.is a manufacturer of tobacco cigarettes in Mexico and provides consulting services and parts for Hempacco equipment.

UST currently owns 30,577,928,723 shares of common stock of Green Globe International, Inc., representing 56.4% of the issued and outstanding common stock of the parent company of Hempacco. UST is a related party by virtue of Sandro Piancone's 29.38% interest in UST.

Lake Como is owned/controlled by Sandro Piancone. This entity is used primarily as a sales company, and sometimes sells products purchased from the Company. The Company had receivables of $150 and $5,586 due from Lake Como as of December 31, 2021 and 2020 respectively.

**NOTE 12 – INCOME TAXES**

The Company provides for income taxes under ASC 740, "*Income Taxes."* Under the asset and liability method of ASC 740, deferred tax assets and liabilities are recorded based on the differences between the financial statement and tax basis of assets and liabilities and the tax rates in effect when these differences are expected to reverse. A valuation allowance is provided for certain deferred tax assets if it is more likely than not that the Company will not realize tax assets through future operations.

The following is a reconciliation of income tax expense for the year ended December 31, 2021 and 2020.

---

| | | |
|:---|:---|:---|
|  | **2021** | **2020** |
| Current: |  |  |
| Federal | $- | $- |
| State |  |  |
| Foreign | - | - |
| Deferred: |  |  |
| Federal | (292851) | (264815) |
| State | (81363) | (73573) |
|  | (374214) | (338388) |
| Valuation allowance | 374214 | 338388 |
| Total provision for income taxes | $- | $- |

---

---

| |
|:---|
| F-17 |
| *[**Table of Contents**](#TOCFS)* |

---

The Company's net deferred tax assets at December 31, 2021 and 2020 consisted of the following:

---

| | | |
|:---|:---|:---|
|  | **2021** | **2020** |
| Depreciation & Amortization | $- |  |
| Reserves and Accruals | 171338 | 169791 |
| Research & Development Credits |  |  |
| Net Operating Loss Carryforwards | 555578 | 182911 |
| Gross Deferred Tax Assets | 726916 | 352702 |
| Valuation Allowance | (726916) | (352702) |
| Net Deferred Tax Assets | $- | $- |

---

The Company has provided for a full valuation allowance against the deferred tax assets, on the expected future tax benefits from the net operating loss carryforwards, as the management believes it is more likely than not that these assets will not be realized in the future.

The difference between the effective tax rate and the stated tax rate is primarily due to a full valuation allowance on the deferred tax assets and permanent differences due to non-cash related charges.

As of December 31, 2021, the Company's net operating losses (NOL's) on a gross basis were $2,070,397, which can be carried forward indefinitely to offset future taxable income. The losses carried forward are limited to 80% of future taxable income.

In California, the FTB allows NOL's to be carried back to the prior two years, and/or carried forward in accordance with IRS rules

For taxable years 2020. 2021 and 2022, California has suspended the NOL carryover deduction. Corporations may continue to compute and carryover an NOL during the suspension period.

The Company's tax returns are subject to examination by United States Internal Revenue Service authorities as well as the California Franchise Tax Board, beginning with the period ended December 31, 2019. There are no current tax examinations.

**NOTE 13 – STOCKHOLDERS' EQUITY**

*Preferred Stock*

*Series A Preferred Shares*

On May 20, 2021, the Company's Board of Directors declared and authorized a 6% common share dividend to Series A Preferred Shareholders. Mexico Franchise Opportunities Fund ("MFOF") received dividends of $757,479 which, together with MFOF's 8,000,000 preferred shares were converted into 8,757,479 shares of Hempacco common shares. On May 21, 2021, MFOF exchanged these Hempacco common shares for 33,473,197,809 shares of GGII common shares.

On September 28, 2021, the Company amended its Articles of Incorporation to increase the number of authorized shares of preferred stock to 50,000,000, and changed its preferred stock par value to $0.001 per share.

The holder of the Company's Series A Preferred Stock was entitled to a dividend of 6% payable in common shares, if and when declared by the Company's Board of Directors. The Series A preferred shares shall not have the right to vote on matters presented to the holders of junior stock.

---

| |
|:---|
| F-18 |
| *[**Table of Contents**](#TOCFS)* |

---

As of December 31, 2021, the Company had no shares of Series A Preferred Stock, nor any other shares of preferred stock, issued and outstanding.

*Common Stock*

On May 21, 2021, Hempacco issued 100,000 shares of common stock to a consultant for services rendered. The share were paid in exchange for software development and IT services related to the Company's automated CBD kiosks. The Hempacco common stock was valued at $100,000 (based upon the price for which convertible notes were being converted at) and was exchanged for 382,224,109 shares of GGII's common shares.

On August 11, 2021, the Company signed an agreement with Boustead Securities, LLC (the "Representative"), which was amended on or about March 18, 2022, effective as of August 11, 2021, with respect to a number of proposed financing transactions, including the initial public offering ("IPO") of the Company's common stock for which a listing on NASDAQ has been applied for, the private placement of Company securities prior to the IPO ("pre-IPO Financings"), and other financings separate from the IPO or the pre-IPO Financings (each such other financing an "Other Financing"). A commission of 7% of gross offering proceeds is payable to the Representative, as well as a non-accountable expense allowance of 1% of offering proceeds. In addition, the Company will reimburse Boustead for due diligence, legal and road show expenses up to $205,000.

On September 28, 2021, the Company amended its Articles of Incorporation to increase its authorized common shares to 200,000,000, and changed its par value to $0.001 per share. Each common share entitles the holder to one vote, in person or proxy, on any matter on which action of the stockholders of the Company is sought.

On or about December 6, 2021, the Company sold 805,541 shares of Company common stock at $1.00 per share to 19 investors, 17 of which were third parties. Neville Pearson, Company CFO, and Dr. Stuart Titus, Company director, purchased 50,000 of the shares for $50,000, and 100,000 of the shares for $100,000, respectively. The Company received gross proceeds of $805,541, and net proceeds of $724,255 after payment of commissions and expenses to the Company's registered broker and the payment of expenses associated with the private offering and the Public Offering.

On or about December 14, 2021, the Company sold 494,459 shares of Company common stock at $1.00 per share to 5 investors, 4 of which were third parties. The family trust of Jerry Halamuda, Company director, purchased 50,000 of the shares for $50,000. The Company received gross proceeds of $494,459, and net proceeds of $333,309.98 after payment of commissions and expenses to the Company's registered broker and the payment of expenses associated with the private offering and the Public Offering.

See Notes 8, 9 and 11 for additional discussion of issuances of common stock.

**NOTE 14 – SUBSEQUENT EVENTS**

The Company has evaluated subsequent events through March 23, 2022, the date of issuance of these financial statements.

---

| |
|:---|
| The following events and transactions occurred subsequent to December 31, 2021: |
| On or about January 1, 2022, the Company entered into a joint venture agreement with Cheech and Chong's Cannabis Company, a Nevada corporation ("CCCC"), to form a joint venture entity in Nevada, which entity will market and sell Cheech & Chong-branded hemp smokable products. Pursuant to the agreement, the joint venture entity will be owned 50% by each of us and CCCC, we are required to fund $10,000 to the joint venture entity, we are required to manufacture joint venture product and provide accounting, inventory management, staff training, and trade show and marketing services for the joint venture entity, and CCCC is required to provide online marketing and promotion, design and branding, brand management and development, trademark receipt, and sales and distribution services. CCCC is also required to ensure that Cheech Marin and Tommy Chong attend and make appearances at joint venture entity events. As an incentive to enter into this joint venture CCCC was awarded 100,000,000 Green Globe International warrants with a Black-Scholes valuation of $.0003 per share for a total valuation of $34,318 on the issue date. |

---

---

| |
|:---|
| F-19 |
| *[**Table of Contents**](#TOCFS)* |

---

On or about January 19, 2022, the Company entered into a joint venture agreement with Stick-It Labs Ltd. ("Stick-It"), an Israeli corporation that manufactures cannabinoid sticks, to develop and sell hemp smokables products in the United States and Mexico utilizing each of the parties' respective expertise. Pursuant to the agreement, the Company is required to fund $750,000 to the joint venture entity, Stick-It USA, Inc., ("StickIt US") a newly formed Delaware corporation, and the Company will then receive preferred shares entitling us to 75% of distributable profits of the joint venture entity until the Company has been repaid $750,000, after which the preferred shares will convert into 750,000 shares of common stock. StickIt will also receive 750,000 shares of common stock. The agreement grants the right to Stick-It to purchase 100,000,000 five-year warrants of Green Globe International, Inc. common stock at an exercise price of $0.01 per share. The warrants are issuable in three tranches, the first 25,000,000 on signing the JV agreement, the second 25,000,000 when StickIt US achieves annual sales revenue in excess of $5,000,000, and the third tranche will be issued upon StickIt US achieving annual sales revenue in excess of $10,000,000. On or about January 20, 2022, the Company entered into employment agreements with Sandro Piancone, the Company's CEO, Neville Pearson, the Company's CFO, and Jorge Olson, the Company's CMO. These agreements supersede and replace the Company's consulting agreements with Mr. Piancone's entity, Strategic Global Partners, Inc., and Mr. Olson's entity, Cube17, Inc. Mr. Pearson's employment agreement with Green Globe International, Inc. remains in place.

On or about February 9, 2022, the Company, through its Investment Banker offered a second pre-IPO round of 500,000 Hempacco common shares to accredited investors at a price of $2.00 per share. The offer will remain open until the maximum subscription is reached or March 31, 2022, whichever occurs first. However, the offering can be extended at the discretion of Boustead and Hempacco.

On January 6, 2022 the first payment of $50,000 was made to Titan Agency Management against the outstanding balance of the equipment loan Refer to Note 8 for further information.

---

| |
|:---|
| F-20 |
| *[**Table of Contents**](#TOCFS)* |

---

**HEMPACCO CO., INC.**

**UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS**

---

| | | |
|:---|:---|:---|
|  | **September 30,**<br>**2022** | **December 31,**<br>**2021** |
| **ASSETS** |  |  |
| Current assets: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Cash and cash equivalents | $2973686 | $933469 |
| &nbsp;&nbsp;&nbsp;&nbsp;Trade receivables, net | 303771 | 144246 |
| &nbsp;&nbsp;&nbsp;&nbsp;Trade receivables, related parties | 153778 | 137297 |
| &nbsp;&nbsp;&nbsp;&nbsp;Loans receivable, related parties | 61345 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Inventories | 798508 | 198936 |
| &nbsp;&nbsp;&nbsp;&nbsp;Deposits and prepayments | 906503 | 703690 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total current assets | 5197591 | 2117638 |
| Property and equipment |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Leasehold Improvements | 12431 | 12431 |
| &nbsp;&nbsp;&nbsp;&nbsp;Furniture, Fixtures and Equipment | 8656979 | 5147693 |
| &nbsp;&nbsp;&nbsp;&nbsp;Accumulated Depreciation | (230319) | (161353) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total property and equipment | 8439091 | 4998771 |
| Other Assets |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;ROU operating leases less accumulated amortization | 377479 | 454114 |
| &nbsp;&nbsp;&nbsp;&nbsp;Other intangible assets – net of amortization | 649899 | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total other assets | 1027378 | 454114 |
| Total assets | $14664060 | $7570523 |
| **LIABILITIES AND STOCKHOLDERS' EQUITY** |  |  |
| Current liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Accounts payable and accrued expenses | $250839 | $97800 |
| &nbsp;&nbsp;&nbsp;&nbsp;Accounts payable, related parties | 75747 | 162405 |
| &nbsp;&nbsp;&nbsp;&nbsp;Accrued interest on notes | 15751 | 9416 |
| &nbsp;&nbsp;&nbsp;&nbsp;Short term promissory notes payable, related parties | 50000 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Convertible promissory notes payable | 125000 | 175000 |
| &nbsp;&nbsp;&nbsp;&nbsp;Equipment loans |  | 1482681 |
| &nbsp;&nbsp;&nbsp;&nbsp;Loans payable, related parties | 566 | 9600 |
| &nbsp;&nbsp;&nbsp;&nbsp;Customer prepaid invoices and deposits | 1013127 | 2128393 |
| &nbsp;&nbsp;&nbsp;&nbsp;ROU operating lease liability, short term portion | 107845 | 102969 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total current liabilities | 1638875 | 4168264 |
| Long term liabilities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Long-term debt | 158328 | 168328 |
| &nbsp;&nbsp;&nbsp;&nbsp;ROU straight-line rent liability | 16668 | 15126 |
| Operating lease ROU liability | 269634 | 351145 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total long-term liabilities | 444630 | 534599 |
| Contingencies and commitments | - | - |
| Total liabilities | 2083505 | 4702863 |
| Stockholders' equity: |  |  |
| Preferred stock, $0.001 par value; 50,000,000 shares authorized; 10,000,000 shares designated as Series A Preferred Stock and 0 issued and outstanding |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Series A Preferred stock, $0.001 par value; 10,000,000 shares authorized; 0 shares issued and outstanding  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Common stock, $0.001 par value; 200,000,000 shares authorized; 23,373,213 and 19,695,532 shares issued and outstanding as of September 30, 2022 and December 31, 2021, respectively | 23373 | 19696 |
| Additional paid in capital | 18054685 | 6321428 |
| Accumulated deficit | (5490216) | (3459214) |
| &nbsp;&nbsp;&nbsp;&nbsp;Total stockholders' equity | 12587842 | 2881910 |
| Non-controlling interests | (7287) | (14250) |
| &nbsp;&nbsp;&nbsp;&nbsp;Total equity attributable to Hempacco Co., Inc. | 12580555 | 2867660 |
| Total liabilities and stockholders' equity | $14664060 | $7570523 |

---

The accompanying notes are an integral part of these Condensed Consolidated Interim Financial Statements.

---

| |
|:---|
| F-21 |
| *[**Table of Contents**](#TOCFS)* |

---

**HEMPACCO CO., INC.**

**CONDENSED CONSOLIDATED STATEMENTS OF INCOME**

**(Unaudited)**

---

| | | | | |
|:---|:---|:---|:---|:---|
|  | **Three months ended September 30,** | **Three months ended September 30,** | **Nine months ended September 30,** | **Nine months ended September 30,** |
|  | **2022** | &nbsp;&nbsp;**2021** | **2022** | &nbsp;&nbsp;&nbsp;**2021** |
| Revenues: |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Product sales | $561818 | $275769 | $3373380 | $542728 |
| &nbsp;&nbsp;&nbsp;&nbsp;Product sales – related parties | 16940 | 37914 | 22940 | 95517 |
| &nbsp;&nbsp;&nbsp;&nbsp;Manufacturing service | 6653 | 63538 | 33248 | 224813 |
| &nbsp;&nbsp;&nbsp;&nbsp;Kiosk Revenues | 6824 |  | 8890 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Consulting services – related parties | - | 47950 | - | 47950 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total revenues | 592235 | 425171 | 3438458 | 911008 |
| &nbsp;&nbsp;&nbsp;&nbsp;Cost of sales | 598627 | 315281 | 2795661 | 613784 |
| &nbsp;&nbsp;&nbsp;&nbsp;Gross profit from operations | (6392) | 109890 | 642797 | 297224 |
| &nbsp;&nbsp;&nbsp;&nbsp;General and administrative | 791562 | 107891 | 1758561 | 736812 |
| &nbsp;&nbsp;&nbsp;&nbsp;General and administrative, related parties | 45000 | 283973 | 195000 | 403973 |
| &nbsp;&nbsp;&nbsp;&nbsp;Sales and marketing | 200976 | 31815 | 685086 | 96638 |
| Research and development |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total operating expenses | 1037538 | 423679 | 2638647 | 1237423 |
| Operating loss | (1043930) | (313789) | (1995850) | (940199) |
| Other income (expense): |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Interest expense, net | (3684) | (3513) | (13080) | (206145) |
| &nbsp;&nbsp;&nbsp;&nbsp;Other expense, net | (1859) | (50001) | (15109) | (50359) |
| Income before income taxes | (1049473) | (367303) | (2024039) | (1196703) |
| Provision for income taxes |  |  |  |  |
| Net loss | $(1049473) | $(367303) | $(2024039) | $(1196703) |
| Net loss attributable to non-controlling interests | 617 | - | 2200 | - |
| Net loss attributable to Hempacco Co., Inc. | (1048856) | (367303) | (2021839) | (1196703) |
| Dividends issued to preferred stockholders | - | - | - | 757479 |
| Net loss attributable to common shareholders | (1048856) | (367303) | (2021839) | (1954182) |
| Basic and dilutive earnings per share: | $(0.05) | $(0.02) | $(0.10) | $(0.12) |
| Shares outstanding – basic and diluted: | 21689509 | 18395532 | 20421159 | 16072448 |

---

The accompanying notes are an integral part of these Condensed Consolidated Interim Financial Statements.

---

| |
|:---|
| F-22 |
| *[**Table of Contents**](#TOCFS)* |

---

**HEMPACCO CO., INC.**

**CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY**

**(Unaudited)**

---

| | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Number of shares of** <br> **preference**<br>**shares** | **Preference shares** <br>**par value** | **Number of shares of** <br>**common** <br>**shares**  | **Common** <br>**Shares** <br>**par value** | **Additional** <br>**paid-in capital** | **Accumulated** <br>**deficit** | **Non-**<br>**controlling** <br>**interests** | **Stockholders'** <br>**deficit** |
| **For the three months ended September 30, 2022** |  |  |  |  |  |  |  |  |
| Balance as of June 30, 2022 |  | $- | 19960124 | $19960 | $7154605 | $(4432197) | $(15833) | $2726535 |
| &nbsp;&nbsp;&nbsp;&nbsp;Acquisition of machinery and trademarks |  |  | 2000000 | 2000 | 3998000 |  |  | 4000000 |
| &nbsp;&nbsp;&nbsp;&nbsp;Conversion of accounts payable to common stock |  |  | 50000 | 50 | 99950 |  |  | 100000 |
| &nbsp;&nbsp;&nbsp;&nbsp;JV partner capital contribution to joint venture |  |  |  |  | 52000 |  |  | 52000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IPO common shares issuance |  |  | 1000000 | 1000 | 5999000 |  |  | 6000000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IPO capital raise expense |  |  |  |  | (531188) |  |  | (531188) |
| &nbsp;&nbsp;&nbsp;&nbsp;Boustead cashless warrant conversion |  |  | 54928 | 55 | (55) |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Titan General Agency Ltd. debt repayment |  |  | 266667 | 267 | 1182414 |  |  | 1182681 |
| &nbsp;&nbsp;&nbsp;&nbsp;North Equities USA Ltd. – marketing services |  |  | 41494 | 41 | 99959 |  |  | 100000 |
| &nbsp;&nbsp;&nbsp;&nbsp;Equity attributable to non-controlling interests |  |  |  |  |  | (9163) | 9163 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Net loss attributable to non-controlling interests |  |  |  |  |  | 617 | (617) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Net loss for three months ended September 30, 2022 | - | - | - | - | - | (1049473) | - | (1049473) |
| Balance as of September 30, 2022 | - | $- | 23373213 | $23373 | $18054685 | $(5490216) | $(7287) | $12580555 |
| **For the nine months ended September 30, 2022** |  |  |  |  |  |  |  |  |
| Balance as of December 31, 2021 |  | $- | 19695532 | $19696 | $6321428 | $(3459214) | $(14250) | $2867660 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Warrant valuation expense |  |  |  |  | 437375 |  |  | 437375 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pre-IPO 2 capital raise |  |  | 208000 | 208 | 415792 |  |  | 416000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Pre-IPO 2 capital raise expenses |  |  |  |  | (76525) |  |  | (76525) |
| &nbsp;&nbsp;&nbsp;&nbsp;Convertible note converted to common stock |  |  | 56592 | 56 | 56535 |  |  | 56591 |
| &nbsp;&nbsp;&nbsp;&nbsp;Acquisition of machinery and trademarks |  |  | 2000000 | 2000 | 3998000 |  |  | 4000000 |
| &nbsp;&nbsp;&nbsp;&nbsp;Conversion of accounts payable to common stock |  |  | 50000 | 50 | 99950 |  |  | 100000 |
| &nbsp;&nbsp;&nbsp;&nbsp;JV partner capital contribution to joint venture |  |  |  |  | 52000 |  |  | 52000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IPO common shares issuance |  |  | 1000000 | 1000 | 5999000 |  |  | 6000000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;IPO capital raise expense |  |  |  |  | (531188) |  |  | (531188) |
| &nbsp;&nbsp;&nbsp;&nbsp;Boustead cashless warrant conversion |  |  | 54928 | 55 | (55) |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Titan General Agency Ltd. debt repayment |  |  | 266667 | 267 | 1182414 |  |  | 1182681 |
| &nbsp;&nbsp;&nbsp;&nbsp;North Equities USA Ltd. – marketing services |  |  | 41494 | 41 | 99959 |  |  | 100000 |
| &nbsp;&nbsp;&nbsp;&nbsp;Equity attributable to non-controlling interests |  |  |  |  |  | (9163) | 9163 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Net loss attributable to non-controlling interests |  |  |  |  |  | 2200 | (2200) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Net loss for nine months ended September 30, 2022 | - | - | - | - | - | (2024039) | - | (2024039) |
| Balance as of September 30, 2022 | - | $- | 23373213 | $23373 | $18054685 | $(5490216) | $(7287) | $12580555 |
| **For the three months ended September 30, 2021** |  |  |  |  |  |  |  |  |
| Balance as of June 30, 2021 |  | $- | 18395531 | $183955 | $4951286 | $(2431910) | $- | $2703331 |
| &nbsp;&nbsp;&nbsp;&nbsp;Conversion of preference shares |  |  |  | (165559) | 165559 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net loss for three months ended September 30, 2021 | - | - | - | - | - | (367303) | - | (367303) |
| Balance as of September 30, 2021 | - | $- | 18395531 | $18396 | $5116845 | (2799492) | $- | $2335749 |
| **For the nine months ended September 30, 2021** |  |  |  |  |  |  |  |  |
| Balance as of December 31, 2020 | 8000000 | $3638357 | 8478000 | $84780 | $102220 | $(1602789) | $- | $2222568 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Promissory note investors |  |  | 535052 | 5350 | 529703 |  |  | 535053 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Related party accounts payable converted to common stock |  |  | 525000 | 5250 | 519750 |  |  | 525000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Preference share dividend issued | 757479 |  |  |  | (757479) |  |  | (757479) |
| &nbsp;&nbsp;&nbsp;&nbsp;Creation of related party warrant discounts |  |  |  |  | 149831 |  |  | 149831 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Service expenses paid with shares |  |  | 100000 | 1000 | 99000 |  |  | 100000 |
| &nbsp;&nbsp;&nbsp;&nbsp;Conversion of preference shares | (8757479) | (3638357) | 8757479 | 87575 | 4308262 |  |  | 757479 |
| &nbsp;&nbsp;&nbsp;&nbsp;Reduction of par value of common stock |  |  |  | (165559) | 165559 |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net loss for nine months ended September 30, 2021 | - | - | - | - | - | (1196703) | - | (1196703) |
| Balance as of September 30, 2021 | - | $- | 18395531 | $18396 | $5116845 | $(2799492) | $- | $2335749 |

---

The accompanying notes are an integral part of these Condensed Consolidated Interim Financial Statements.

---

| |
|:---|
| F-23 |
| *[**Table of Contents**](#TOCFS)* |

---

**HEMPACCO CO., INC.**

**CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS**

**(Unaudited)**

---

| | | |
|:---|:---|:---|
|  | **Nine months ended September 30,** | **Nine months ended September 30,** |
|  | **2022** | **2021** |
| **Cash flows from operating activities:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Net loss | $(2024039) | $(1196703) |
| &nbsp;&nbsp;&nbsp;&nbsp;**Adjustments to reconcile net loss to net cash used in operating activities** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Depreciation and amortization | 171098 | 73032 |
| &nbsp;&nbsp;&nbsp;&nbsp;Non-cash warrant valuation expense | 437375 | 180296 |
| &nbsp;&nbsp;&nbsp;&nbsp;Stock based compensation for services | 100000 | 100000 |
| &nbsp;&nbsp;&nbsp;&nbsp;Gain / loss) on disposal of assets | 10690 |  |
| **Changes in operating assets and liabilities, net of acquisitions:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Trade receivables, net | (159525) | (221071) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Related party receivables | (16481) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prepaid expenses | (202813) | 2576 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inventories | (599572) | (78027) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable | 253039 | 38260 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable – related parties | (86658) | 186317 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued liabilities | 14468 | 30173 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred revenues | (1115266) | (81096) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash used | (3217684) | (966243) |
| Cash flows from investing activities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Purchases of property, plant and equipment | (169398) | (17289) |
| &nbsp;&nbsp;&nbsp;&nbsp;Franchise fees and licenses related to joint venture | (152609) | - |
| &nbsp;&nbsp;&nbsp;&nbsp;Proceeds from disposal of equipment | 40000 | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash provided by (used in) investing activities | (282007) | (17289) |
| Cash flows from financing activities: |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Equipment loan repayment | (300000) |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Long Term Loan Repayment |  | 83328 |
| &nbsp;&nbsp;&nbsp;&nbsp;Advances from / (repayments to) related parties | (70379) | 294558 |
| &nbsp;&nbsp;&nbsp;&nbsp;Proceeds from short-term promissory note, related parties | 50000 | 650000 |
| &nbsp;&nbsp;&nbsp;&nbsp;Proceeds from the sale of common stock | 6468000 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Offering costs paid in connection with sale of common stock | (607713) | - |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Net cash (used in) provided by financing activities | 5539908 | 1027886 |
| Increase in cash and cash equivalents | 2040217 | 44354 |
| Cash and cash equivalents at beginning of period | 933469 | 500 |
| Cash and cash equivalents at end of period | $2973686 | $44854 |
| **SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Cash Paid for Interest | $- | $- |
| &nbsp;&nbsp;&nbsp;&nbsp;Cash Paid for Taxes | $3635 | $334 |
| **NON-CASH INVESTING AND FINANCING ACTIVITIES:** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Conversion of convertible notes payable and accrued interest to common stock | 56592 | 535054 |
| &nbsp;&nbsp;&nbsp;&nbsp;Conversion of convertible preference shares and accrued dividend with common shares |  | 8757479 |
| &nbsp;&nbsp;&nbsp;&nbsp;Payment for marketing services with common stock | 100000 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Conversion of accounts payable to common stock | 100000 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Payment of equipment loan with common shares | 1182681 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Payment for equipment and intangible assets with common stock | 4000000 |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Payment of related party accrued management fees and rent with common shares |  | 525000 |

---

The accompanying notes are an integral part of these Condensed Consolidated Interim Financial Statements.

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| F-24 |
| *[**Table of Contents**](#TOCFS)* |

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**Notes to the Condensed Consolidated Financial Statements**

 **September 30, 2022 and 2021**

 **(UNAUDITED)**

**NOTE 1 – ORGANIZATION, BUSINESS AND LIQUIDITY**

***Organization and Operations***

Hempacco Co., Inc. the ("Company" or "Hempacco") was formed on April 1, 2019, as a Nevada Corporation.

Hempacco manufactures and distributes hemp smokables both under its own name and white label products for clients. The Company also owns high-tech CBD vending kiosks that it plans to place in retail venues throughout the US, in conjunction with a number of joint venture partners.

These financial statements are those of Hempacco and its subsidiaries.

During 2021, The Company entered into the following Joint Ventures:

a) On or about March 10, 2021, the Company entered into a joint venture partnership agreement with VZ Ventures and BX2SD Hospitality, LLC for the sale and marketing of a proprietary brand of smokables containing the D8 infused variety of hemp. Cali Vibes D8, LLC was formed as the entity's business vehicle which is 50% owned by the Company. The Company will manage the business operations and accounting, as well as manufacturing the product.

b) On or about June 22, 2021, the Company's parent company, GGII, entered into a joint venture agreement with Hemp Hop Global, LLC, a Florida based company in the hip hop talent management business and the sale and distribution of branded snack food products. Hemp Hop Global is managed by Rick Ross, an American Rapper and record executive and his business partner James Lindsay. Hempacco will produce a range of smokable products under the Hemp Hop brand, and Hemp Hop Smokables, LLC was formed as the business entity, of which GGII owns 50%.

On December 14, 2021, GGII assigned all of the membership and other equity and ownership interests in Hemp Hop Smokables LLC to Hempacco., Co., Inc. The business launched on or about May 25, 2022.

During the nine-months ended September 30, 2022, the Company entered into the following Joint Ventures and other significant agreements.

On April 23, 2021 the Company filed a second amendment to its Articles of Incorporation changing the name of the company from The Hempacco Co., Inc. to Hempacco Co., Inc.

The Company merged with, and became a subsidiary of, Green Globe International, Inc. ("GGII") on May 21, 2021.

On August 29, 2022, the Company entered into an underwriting agreement with Boustead Securities, LLC, as representative (the "<u>Representative</u>") of the underwriters (the "<u>Underwriters</u>") in connection with the initial public offering of the Company (the "<u>IPO</u>"). The Underwriting Agreement provides for the offer and sale of 1,000,000 shares of the Company's common stock, par value $0.001 (the "<u>Common Stock</u>") at a price to the public of $6.00 per share (the "<u>Offering</u>"). In connection therewith, the Company agreed to issue 70,000 warrants to purchase shares of Common Stock, exercisable from September 1, 2022, through August 29, 2027, and initially exercisable at $9.00 per share subject to adjustment as provided therein (the "Representative's Warrants"). The Company also granted the Underwriters an option for a period of 45 days to purchase up to an additional 150,000 shares of Common Stock. The Offering is being made pursuant to a Registration Statement on Form S-1 (File No. 333-263805) (the "Registration Statement"), which was declared effective by the Securities and Exchange Commission on August 29, 2022.

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| *[**Table of Contents**](#TOCFS)* |

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The Underwriting Agreement includes customary representations, warranties and covenants by the Company. It also provides that the Company will indemnify the Underwriters against certain liabilities, including liabilities under the Securities Act of 1933, as amended (the "Securities Act"), or contribute to payments the Underwriter may be required to make because of any of those liabilities.

On September 1, 2022, the Offering was completed. At the closing, the Company (i) sold 1,000,000 shares of Common Stock for total gross proceeds of $6,000,000, and (ii) issued the Representative's Warrants. After deducting the underwriting commission and expenses, the Company received net proceeds of $5,468,812.

On or about January 20, 2022, the Company entered into employment agreements with Sandro Piancone, Hempacco's CEO, Neville Pearson, the Company's CFO, and Jorge Olson, the Company's CMO. These agreements supersede and replace the Company's consulting agreements with Mr. Piancone's entity, Strategic Global Partners, Inc., and Mr. Olson's entity, Cube17, Inc. They key terms of Mr. Piancone's and Mr. Olsen's employment provide for a base salary of $10,000 per month each, with the potential to earn a performance-based bonus of up to 110% of the annual base salary. Mr. Piancone and Mr. Olsen will also be eligible to participate in any stock or option-based incentive plans that the board of directors may approve in the future. The initial employment period is for three years, with a one-year option to extend being available to the Company. Mr. Pearson's employment agreement with Green Globe International, Inc. remains in place.

On or about January 1, 2022, the Company entered into a joint venture agreement with Cheech and Chong's Cannabis Company, a Nevada corporation ("CCCC"), to form a joint venture entity in Nevada, which entity will market and sell Cheech & Chong-branded hemp smokable products. Pursuant to the agreement, the joint venture entity will be owned 50% by each of us and CCCC, we are required to fund $10,000 to the joint venture entity. As of the date of publication of these financial statements this contribution had not been made, however Hempacco has been producing product inventory at its own expense prior to the official launch of the product in July 2022.

The joint venture agreement calls for the Company to manufacture joint venture product and provide accounting, inventory management, staff training, and trade show and marketing services for the joint venture entity, and CCCC is required to provide online marketing and promotion, design and branding, brand management and development, trademark receipt, and sales and distribution services. CCCC is also required to ensure that Cheech Marin and Tommy Chong attend and make appearances at joint venture entity events. As an incentive to enter into this joint venture, CCCC was awarded 100,000,000 Green Globe International warrants with a Black-Scholes valuation of $0.0031 per share for a total valuation of $309,990 on the issue date. This theoretical value was expensed within general and administrative expense on the statement of operations.

On or about January 19, 2022, the Company entered into a joint venture agreement with Stick-It Labs Ltd. ("Stick-It"), an Israeli corporation that manufactures cannabinoid sticks, to develop and sell hemp smokables products in the United States and Mexico utilizing each of the parties' respective expertise. Pursuant to the original agreement, the Company was required to fund $750,000 to the joint venture entity, Stick-It USA, Inc. ("StickIt USA), a Delaware corporation. On September 7, 2022, the agreement was amended to reduce the initial capital contribution to $250,000. On September 12, 2022, the Company funded $250,000 to StickIt USA, for such funding will receive preferred shares entitling the Company to 75% of distributable profits of the joint venture entity until the Company has been repaid $250,000, after which the preferred shares will convert into 250,000 shares of common stock of StickIt USA, which will then constitute 50% ownership of StickIt USA, with the other 250,000 shares of StickIt USA common stock then owned by StickIt.

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| F-26 |
| *[**Table of Contents**](#TOCFS)* |

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The agreement grants the right to Stick-It to purchase 100,000,000 five-year warrants of Green Globe International, Inc. common stock at an exercise price of $0.01 per share. The warrants are issuable in three tranches, the first 25,000,000 on signing the JV agreement, the second 25,000,000 when StickIt USA achieves annual sales revenue in excess of $5,000,000, and the third tranche will be issued upon StickIt USA achieving annual sales revenue in excess of $10,000,000. The first tranche of 25,000,000 Green Globe International warrants were valued by the Black-Scholes method at $0.0051 per share for a total capitalized value of $127,385. This amount was also expensed within general and administrative expense on the statement of operations.

***Going Concern Matters***

The accompanying financial statements have been prepared on a going concern basis, which assumes the Company will be able to realize its assets and settle its liabilities in the normal course of business for the foreseeable future.

**NOTE 2 – SIGNIFICANT ACCOUNTING POLICIES**

***Basis of Presentation***

The accompanying unaudited interim condensed consolidated financial statements include all adjustments consisting of normal recurring adjustments that are, in the opinion of management, necessary for a fair presentation of the financial position and results of operations and cash flows for the interim periods presented. The results of operations for the three and nine months ended September 30, 2022 are not necessarily indicative of results for a full fiscal year or any other period.

The accompanying condensed consolidated financial statements for the three and nine months ended September 30, 2022 and 2021 have been prepared by us in accordance with U.S. generally accepted accounting principles ("U.S. GAAP") for interim financial information and pursuant to the rules and regulations of the United States ("U.S.") Securities and Exchange Commission ("SEC"). Certain information and footnote disclosures normally contained in financial statements prepared in accordance with accounting principles generally accepted in the U.S. ("U.S. GAAP") have been condensed or omitted. These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto contained in our Annual Report for the fiscal year ended December 31, 2021 contained in our registration statement in form S-1 filed on March 24, 2022.

***Principles of Consolidation***

The financial statements include the accounts of the Company and all of its wholly owned subsidiaries. All significant inter-company balances and transactions have been eliminated in consolidation.

Joint Venture entities where the company owns at least 51% and controls the accounting and administration of the entities will be accounted for under ASC 810-10 which will allow full consolidation of the assets and liabilities into the Company's balance sheet, with non-controlling interests being calculated and disclosed in the balance sheet and operating statement of the Company. Joint Venture entities where the company owns less than 51% are evaluated for treatment as variable interest entities. The Company may provide accounting and administration for these entities, may have board of director control, and may provide majority of funding for these entities. Any entities not falling within this criterion will be accounted for under ASC 323-30. These condensed consolidated interim financial statements include the operating results and the assets of the two currently operating, joint venture entities from the four that have been deemed variable interest entities for the period ended September 30, 2022. The non-controlling interests of these ventures have been disclosed on the consolidated balance sheet and income statement.

***Use of Estimates***

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Some of these judgments can be subjective and complex, and, consequently, actual results may differ from these estimates.

***Revenue Concentration***

Sales to one of the Company's customers made up approximately 81.5% and 81.3% of our revenues for the three and nine months ended September 30, 2022, and the balance receivable from this customer at September 30, 2022 represents approximately 46.5% of the total accounts receivable balances of $469,730 as of that date. We do not have a binding purchase agreement with this customer, and the loss of this customer would have an impact on our operations and cash flows.

***Basic and Diluted Net Loss per Common Share***

Pursuant to ASC 260, "Earnings Per Share," basic net income and net loss per share are computed by dividing the net income and net loss by the weighted average number of common shares outstanding. Diluted net income and net loss per share is the same as basic net income and net loss per share when their inclusion would have an anti-dilutive effect due to our continuing net losses.

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| *[**Table of Contents**](#TOCFS)* |

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For the nine months ended September 30, 2022 and 2021 the following outstanding dilutive securities were excluded from the computation of diluted net loss per share as the result of the computation was anti-dilutive.

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| | | | | |
|:---|:---|:---|:---|:---|
|  | **September 30**  | **September 30**  | **September 30**  | **September 30**  |
|  | **2022** | **2022** | **2021** | **2021** |
|  | (Shares) | (Shares) | (Shares) | (Shares) |
| **Promissory Notes convertible to shares** |  | 125,000 |  | 175,000 |
| TOTAL |  | 125,000 |  | 175,000 |

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***Fair Value of Financial Instruments***

FASB ASC 820, *Fair Value Measurements and Disclosure*s ("ASC 820") establishes a framework for all fair value measurements and expands disclosures related to fair value measurement and developments. ASC 820 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

ASC 820 requires that assets and liabilities measured at fair value are classified and disclosed in one of the following three categories:

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| Level 1*—*Quoted market prices for identical assets or liabilities in active markets or observable inputs. |
| Level 2*—*Significant other observable inputs that can be corroborated by observable market data; and |
| Level 3*—*Significant unobservable inputs that cannot be corroborated by observable market data. |

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The carrying amounts of cash, accounts receivable, accounts receivable – related parties, inventory, deposits and prepayments, accounts payable and accrued liabilities, accounts payable – related parties, customer pre-paid invoices & deposits, other short-term liabilities – equipment loan, operating lease – right of use liability – short term portion approximate fair value because of the short-term nature of these items.

***Advertising and Marketing Costs***

Costs associated with advertising and marketing promotions are expensed as incurred. Advertising and marketing expense were $685,086 and $96,638 for the nine months ended September 30, 2022 and 2021, respectively.

***Revenue Recognition***

The Company recognizes revenue in accordance with ASC 606, Revenue from Contracts with Customers. The Company generally earns its revenue by supplying goods or providing services under contracts with its customers in two primary revenue streams: manufacturing and commercial product supply and white label development services. The Company measures the revenue from customers based on the consideration specified in its contracts, or the value of the amount invoiced should the initial order be a basic purchase order or emailed order.

The Company recognizes revenue from customers when control of the goods or services are transferred to the customer, generally when products are shipped, at an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods.

Per Company policy, any product that doesn't meet the customer's expectations can be returned within the first 30 days of delivery in exchange for another product or for a full refund. Any product sold through a distributor or retailer must be returned to the original purchase location for any return or exchange. For the nine months ended September 30, 2022 and 2021, the Company has not recorded any reserves on revenue.

The majority of the Company's revenue is derived from sales of branded products to consumers via our direct-to-consumer (DTC) ecommerce website, distributors, and retail and wholesale "white label" business-to-business (B2B) customers.

For larger orders, the Company requires the customer to make a deposit equal to 50% of the invoice or order total which is recorded as customer prepaid invoices and deferred revenue on the balance sheet. When the product is shipped the customer deposit is recorded into revenue. The Company recorded $388,752 and $1,505,018 in customer pre-paid invoices and deposits for goods ordered but not delivered, as of September 30, 2022 and December 31, 2021, respectively. These numbers do not include the $623,375 referenced in the ensuing paragraph.

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In 2019, the Company entered into an arrangement with a customer whereby the Company was provided with product from the customer for the Company's and the customer's use. Under the arrangement, 50% of the product provided by the customer was to compensate the Company for their services for processing and packaging the customers remaining 50% share. The transaction was recorded at the fair market value of the inventory received, which was similar to the cost of the services to which were to be provided with an increase of $623,375 to inventory and customer deposits. As of September 30, 2022 and December 31, 2021, the customer deposit liability of $623,375 remained. The Company will defer revenue on customer deposits and record as revenue once product is delivered.

***Non-Controlling Interests***

The Company accounts for the non-controlling interests in its subsidiaries and joint ventures in accordance with U.S. GAAP and ASC 805-20.

The Company has chosen to record the minority interests (NCI's) in the equity section of the balance sheet, and on the income statement, the profit or loss attributable to the minority interests will be reported as a separate non-operating line item.

The Company measures its NCI's using the percentage of ownership interest held by the respective NCI's during the accounting period. As of September 30, 2022 and December 31, 2021, the Company reported a minority interest in its accumulated losses and its net assets of $7,287 and $14,250, respectively.

***Recent Accounting Pronouncements***

In December 2019, the Financial Accounting Standards Board (FASB) issued Accounting Standard Update No. 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (ASU 2019-12), which simplifies the accounting for income taxes. This guidance will be effective for entities for the fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020 on a prospective basis, with early adoption permitted. We adopted the new standard effective January 1, 2021 and do not expect the adoption of this guidance to have a material impact on our financial statements.

In August 2020, the FASB issued ASU 2020-06, ASC Subtopic 470-20 "Debt—Debt with "Conversion and Other Options" and ASC subtopic 815-40 "Hedging—Contracts in Entity's Own Equity". The standard reduced the number of accounting models for convertible debt instruments and convertible preferred stock. Convertible instruments that continue to be subject to separation models are (1) those with embedded conversion features that are not clearly and closely related to the host contract, that meet the definition of a derivative, and that do not qualify for a scope exception from derivative accounting; and, (2) convertible debt instruments issued with substantial premiums for which the premiums are recorded as paid-in capital. The amendments in this update are effective for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. The Company adopted this standard effective January 1, 2021.

The Company has reviewed all other recently issued, but not yet effective, accounting pronouncements and does not believe the future adoption of any such pronouncements may be expected to cause a material impact on our financial statements.

**NOTE 3 – ACCOUNTS RECEIVABLE**

As of September 30, 2022 and December 31, 2021, accounts receivable consisted of the following:

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|:---|:---|:---|
|  | **September 30**<br>**2022** | **December 31** <br>**2021** |
| Accounts receivable | $306288 | $144246 |
| Accounts receivable – related parties\* | 153778 | 137297 |
| Allowance for doubtful accounts | (2517) | - |
| **Total accounts receivable** | $457549 | $281543 |

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\* Includes $122,352 and $132,147 as of September 30, 2022 and December 31, 2021 respectively, due from UST Mexico, Inc. for Hemp products (72%) and manufacturing services (28%). See Note 11 for additional information on related party transactions related to receivables.

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| F-29 |
| *[**Table of Contents**](#TOCFS)* |

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**NOTE 4 – INVENTORY**

As of September 30, 2022 and December 31, 2021, inventory, which consists primarily of the Company's raw materials, finished products and packaging is stated at the following amounts:

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|:---|:---|:---|
|  | **September 30**<br>**2022** | **December 31** <br>**2021** |
| Finished goods | $261236 | $41088 |
| Raw materials (Net of obsolescence allowance) | 537272 | 157848 |
| Total inventory at cost less obsolescence allowance | $798508 | $198936 |

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The Company identified a potential for obsolescence in particular raw materials and provided an allowance for this risk in full in the year ended December 31, 2020. As of September 30, 2022 and December 31, 2021, this allowance remains unchanged. This obsolescence allowance is continually re-evaluated and adjusted as necessary.

**NOTE 5 – PROPERTY AND EQUIPMENT**

See Note 11 for further information concerning the acquisition of kiosks.

As of September 30, 2022 and December 31, 2021, property and equipment consisted of the following:

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| | | |
|:---|:---|:---|
|  | **September 30**<br>**2022** | **December 31** <br>**2021** |
| Production equipment | $5025700 | $1461586 |
| Leasehold improvements | 12431 | 12431 |
| Kiosks plus improvements | 3631279 | 3686107 |
| Less accumulated depreciation | (230319) | (161353) |
| Total property and equipment | $8439091 | $4998771 |

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Depreciation expense totaled $68,388 and $73,032 for the nine months ended September 30, 2022 and 2021, respectively.

**NOTE 6 – OPERATING LEASES – RIGHT OF USE ASSETS**

The Company entered into a 60-month lease to lease approximately 6,300 square feet of manufacturing, storage and office space on January 1, 2020 for a period of 6 years with a related party, an entity controlled by the Company's CEO. Approximately 1,800 sf (28.5%) is used as a manufacturing facility with the balance used as corporate offices and storage. There was no security deposit paid, and the lease carries no optional extension periods. The term of the lease is for six years. At inception of the lease, the Company recorded a right of use asset and liability. The Company used an effective borrowing rate of 6.232% within the calculation.

Base monthly rent commenced at $10,000 per month, with subsequent defined annual increases. All operating expenses are born by the lessee. Amounts payable to the related party for rent as of September 30, 2022 and December 31, 2021 were $9 and $0 respectively. On September 30, 2022 and December 31, 2021, the amounts of $16,752 and $14,764 respectively, of prepaid rent were included in the deposits and prepayments account.

Lease expense, on the straight-line basis was $97,020 during the nine months ended September 30, 2022 and 2021.

**NOTE 7 – OTHER SHORT-TERM LIABILITIES – EQUIPMENT LOAN**

On December 11, 2019, The Company entered into a short-term loan for equipment to use in its production. The terms of the loan were, $1,500,000 over 18 months with zero interest, which necessitated the calculation of an imputed discount of $109,627, which was being amortized over 18 months. During the year ended December 31, 2021, the Company amortized the remaining discount of $30,465 to interest expense.

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| F-30 |
| *[**Table of Contents**](#TOCFS)* |

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The loan is secured by the equipment, and the lender recently agreed to repayments of $50,000 per month, interest free, which would take approximately thirty months to retire the loan, assuming no additional paydowns were made by supplying smokable products. As of September 30, 2022 and December 31, 2021, the principal balance of the loan was $0 and $1,482,681, respectively. On January 6, 2022 the first payment of $50,000 was made to Titan Agency Management. The Company was granted forbearance with respect to further loan payments until the Company's planned IPO was funded.

On September 6, 2022, a settlement agreement and mutual release was signed by the Company and the Titan Agency Management providing for the full repayment of the outstanding loan balance with a cash payment of $250,000 and the issuance of 266,667 restricted shares of Hempacco common stock.

**NOTE 8 – CONVERTIBLE NOTES**

During the year ended December 31, 2021, the Company issued twelve convertible promissory notes totaling $650,000 and warrants to purchase up to 750,000 shares of Hempacco common stock at $1.00 per share were issued to two related party members of the Board of Directors. Subsequently, as a result of the merger and share exchange agreement of May 21, 2021 between Hempacco and Green Globe International, Inc. these warrants were cancelled and replaced on November 9, 2021 with equivalent warrants to purchase Green Globe common shares. See Note 9 below for additional details.

Individual note holders converted $511,500 in principle and $23,552 in accrued interest into 535,052 shares of Hempacco common stock. On May 21, 2021, these shares were exchanged for 2,236,213,775 of GGII's common shares.

During May and June 2021, the Company entered into financing arrangements to provide working capital. The Company received proceeds of $175,000 from three private investors. The promissory notes carried interest at the rate of between 8% and 12% and mature between May 4, 2022 and October 23, 2022. The Notes automatically convert at 75% of the 30-day average bid price of the obligor common stock (or the public company common stock as the case may be), with the exception of the $50,000 Taverna 12% Note which converts at $1.00 per share or the current market price of Hempacco stock. The Notes cannot be converted prior to maturity. The Taverna note matured on May 4, 2022, and was converted, along with accrued interest, into 56,592 shares of Hempacco common stock on June 7, 2022.

On or about March 18, 2022 the Company issued a promissory note to a related party for $50,000. The note carries an interest rate of 8% and matures on June 18, 2022. The note is secured by 50,000 common shares of the Company. On June 18, 2022, the Company and the investor signed Amendment No. 1 to the promissory note extending the maturity date to September 18, 2022. Subsequently an Amendment No.2 was executed which extends the maturity date to December 18, 2022.

**NOTE 9 – WARRANTS**

The 750,000 Hempacco warrants issued to Jerry Halamuda and Dr. Stuart Titus in February 2021 were effectively cancelled on May 21, 2021, as a result of the merger and share exchange between Hempacco and Green Globe International, Inc. but not re-issued by Green Globe International, Inc. until November 11, 2021. The total number of replacement warrants issued was 27,173,925 at a strike price of $0.027600 which is the equivalent of 750,000 warrants exercisable at $1.00 each.

A Black-Scholes valuation discount of $149,831 was initially recorded. The discount was expensed as interest in the three months ended March 31, 2021. No further expense was incurred as a result of the modifications of the warrants to GGII warrants. The valuation discount represents the fair market value as derived by using the Black-Scholes formula, which produced an initial valuation of the Hempacco warrants of $0.4986 per share. The Black-Scholes formula applied to the GGII warrants on June 9, 2021 produced a valuation of $0.0138 per share.

The Black-Scholes model uses the following variables to calculate the value of an option or warrant:

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| | | |
|:---|:---|:---|
| **Description** | **Description** | **Input Range** |
| (a) | Price of the Issuer's Security | $1.00-$2.00 |
| (b) | Exercise (strike) price of Security | $0.75-$1.50 |
| (c) | Time to Maturity in years | 3 to 5 years |
| (d) | Annual Risk-Free Rate | 1-year T-Bill |
| (e) | Annualized Volatility (Beta) | 59%-493% |

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| F-31 |
| *[**Table of Contents**](#TOCFS)* |

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On August 11, 2021, The Company signed an agreement with Boustead Securities, LLC (the "Representative"), which was amended on or about March 18, 2022, effective as of August 11, 2021, with respect to a number of proposed financing transactions, including the initial public offering ("IPO") of the Company's common stock for which a listing on NASDAQ has been applied for, the private placement of Hempacco securities prior to the IPO ("pre-IPO Financings"), and other financings separate from the IPO or the pre-IPO Financings (each such other financing an "Other Financing"). See Note 12 below for further details.

In addition to the other compensation delineated in the agreement, The Company agreed to issue and sell to the Representative (and/or its designees) on the closing date of an IPO or Other Financing as applicable, five-year warrants to purchase shares of the Company's common stock equal to 7% of the gross offering amount, at an initial exercise price of 150% of the offering price per share in the IPO, or 100% of the offering price in an Other Financing.

On November 23, 2021, The Company entered into a Broker Representation Agreement with a Third Party, whereby Broker would receive a commission of 10% on any Net sales brought to the Company by their efforts or introductions. In particular, as a bonus for introducing a major client, Broker shall be granted 100,000,000 warrants to purchase common stock of Green Globe International, Inc. exercisable at $0.01 each for a period of three years.

The Black-Scholes valuation of the 100,000,000 warrants as of the contract date is $0.0018 per share for a total valuation of $178,317 which has been recorded as a one-time charge to the income statement in the fourth quarter of 2021 due to there being no future performance obligations arising from this warrant award.

**NOTE 10 – OTHER LOANS PAYABLE**

On June 15, 2020, Hempacco entered into a loan agreement with a third party whereby the Company received $85,000. The terms of the loan were for one year, with 0% interest. On January 15, 2021, the lender advanced a further $83,328 on the same terms. In December 2021 a letter agreement and loan extension were signed by the lender in which it was confirmed that the new maturity date of the loan would be August 15, 2023. The lender also confirmed that $41,000 of the original loan principal had not yet been extended. As of September 30, 2022 and December 31, 2021, the balance outstanding was $168,328 and $168,328 respectively. The lender, also a customer, advanced a deposit of $40,000 for the purchase of 10 vending kiosks which were delivered in February 2022.

**NOTE 11 – RELATED PARTY TRANSACTIONS**

With the exception of kiosks that are used for marketing and demonstration purposes, no depreciation expense is charged until the kiosks are placed in service. As of September 30, 2022, we have placed three kiosks from our remaining inventory of 590 kiosks. Ten kiosks were sold to a buyer in February 2022.

In May 2021, Cube17, Inc., a related party sales and marketing consulting company, converted all outstanding consulting fees earned since the inception of the Company in the amount of $185,000 for 185,000 shares of Hempacco common stock, for $1 per share. On May 21, 2021, these shares were exchanged for 707,113,562 common shares of Green Globe International, Inc. Consulting expenses of $30,000 and $30,000 were recorded for the three months ended March 31, 2022 and 2021. Consulting fee balances payable were $74,000 and $63,404 as of March 31, 2022, and December 31, 2021. In addition, Cube17, Inc., as a founder of the Company, converted its 400,000 founders shares into 1,528,997,476 common shares of Green Globe International, Inc. on May 21, 2021.

In May 2021, Primus Logistics was issued 170,000 common shares of Hempacco as compensation for $170,000 of accrued and unpaid rent owed at that time by from its inception. On May 21, 2021, these shares were exchanged for 649,780,985 common shares of the Company. The Company's CEO, Sandro Piancone, is the 90% owner of Primus Logistics which is considered a related party. Rent Expenses are reported in Note 6 above.

As of September 30, 2022 and December 31, 2021, the Company owed Primus Logistics $9 and $0 respectively, for routine business transactions. As of September 30, 2022 and December 31, 2021, Primus Logistics had been paid $17,752 and $14,764 respectively, in advance, for rent. Sandro Piancone is the 90% owner of Primus Logistics.

In May 2021, Strategic Global Partners, Inc. was issued 170,000 Hempacco common shares as compensation for $170,000 worth of consulting services incurred since Hempacco's inception by the CEO, Sandro Piancone, President and Owner of Strategic Global. On May 21, 2021, these shares were exchanged for 649,780,985 common shares of Green Globe International, Inc. Strategic Global Partners is a related party. Consulting expenses of $60,000 and $60,000 were recorded for the nine months ended September 30, 2022 and 2021 respectively. Unpaid consulting fee balances of $28,000 and $70,000 were outstanding as of September 30, 2022 and December 31, 2021, respectively.

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As of September 30, 2022 and December 31, 2021, the Company owed $12,181 and $29,000 and was owed $134,534 and $132,147, respectively, by UST Mexico, Inc. ("UST"). The Company sells hemp products to UST and provides manufacturing consulting services. The value of goods and services provided to UST Mexico, Inc was $31,840 and $66,635 for the nine months ended September 30, 2022 and 2021 respectively, and the value of goods and services provided by UST Mexico, Inc. was $147,182 and $135,127 for the nine months ended September 30, 2022 and 2021 respectively. UST Mexico, Inc. is a manufacturer of tobacco cigarettes in Mexico and provides consulting services and parts for the Company's equipment.

As of September 30, 2022, UST owned 947,200,000 shares of common stock of Green Globe International, Inc., representing 1.75% of the issued and outstanding common stock of the parent company of Hempacco. UST is a related party by virtue of Sandro Piancone's 25% interest in UST.

Lake Como is owned/controlled by Sandro Piancone. This entity is used primarily as a sales company, and sometimes sells products purchased from Hempacco. The Company had receivables of $150 and $150 due from Lake Como as of September 30, 2022 and December 31, 2021 respectively.

On or about March 1, 2022, the Company entered into a mutual line of credit agreement with its parent company, Green Globe International, Inc. The purpose is to facilitate short-term borrowing needs on an interest free basis, with advances being subject to repayment within 90 days with a maximum of $500,000 allowed to be outstanding within any 90-day period. During the nine months ended September 30, 2022, GGII and its other subsidiaries made to the Company, and received from the Company, payments of $621,755 and $683,100, respectively, under the line of credit. As of September 30, 2022, the balance owed to the Company by GGII was $61,345.

**NOTE 12 – STOCKHOLDERS' EQUITY**

***Hempacco – Series A Preferred Shares***

On May 20, 2021, the Hempacco's Board of Directors declared and authorized a 6% common share dividend to Series A Preferred Shareholders. Mexico Franchise Opportunities Fund ("MFOF") received dividends of $757,479 which, together with MFOF's 8,000,000 preferred shares were converted into 8,757,479 shares of the Company's common shares.

On May 21, 2021 MFOF exchanged these Hempacco common shares for 33,473,197,809 shares of GGII common shares.

On September 28, 2021, the Company amended its Articles of Incorporation to increase the number of authorized shares of preferred stock to 50,000,000, and changed its par value to $0.001.

The holder of Hempacco's Series A Preferred Stock is entitled to a dividend of 6% payable in common shares, if and when declared by Hempacco's Board of Directors. The Series A preferred shares shall not have the right to vote on matters presented to the holders of junior stock.

***Common Stock***

On May 21, 2021, the Company issued 100,000 shares of common stock to a consultant for services rendered. The shares were paid in exchange for software development and IT services related to Hempacco's automated CBD kiosks. The Company's common stock was valued at $100,000 (based upon the contract for services and the agreed upon rates for labor and materials) and was exchanged for 382,224,109 shares of GGII's common shares.

During the year ended December 31, 2021, Hempacco issued convertible promissory notes totaling $650,000 and warrants to purchase up to 750,000 shares of common stock at $1 per share. On or about November 11, 2021 these Hempacco warrants were converted to GGII warrants. See Note 10 above for further details. On May 21, 2021, individual note holders converted $511,500 in principle and $23,552 in accrued interest into 535,052 shares of Hempacco common stock. On May 21, 2021 these shares were exchanged for approximately 2,045,094,734 of Green Globe International Inc. common shares.

On August 11, 2021, the Company signed an agreement with Boustead Securities, LLC (the "Representative"), which was amended on or about March 18, 2022, effective as of August 11, 2021, with respect to a number of proposed financing transactions, including the initial public offering ("IPO") of Hempacco's common stock for which a listing on NASDAQ has been applied for, the private placement of the Company's securities prior to the IPO ("pre-IPO Financings"), and other financings separate from the IPO or the pre-IPO Financings (each such other financing an "Other Financing"). A commission of 7% of gross offering proceeds is payable to the Representative, as well as a non-accountable expense allowance of 1% of offering proceeds. In addition, the Company will reimburse Boustead for the diligence, legal and road show expenses up to $205,000.

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On September 28, 2021, the Company amended its Articles of Incorporation to increase its authorized common shares to 200,000,000, and changed its par value to $0.001 per share. Each common share entitles the holder to one vote, in person or proxy, on any matter on which action of the stockholders of Hempacco is sought.

On or about December 6, 2021, the Company sold 805,541 shares of Hempacco common stock at $1.00/share to 19 investors, 17 of which were third parties. Neville Pearson, Company CFO, and Dr. Stuart Titus, Company director, purchased 50,000 of the shares for $50,000, and 100,000 of the shares for $100,000, respectively. The Company received gross proceeds of $805,541, and net proceeds of $724,255 after payment of commissions and expenses to the Company's registered broker and the payment of expenses associated with the private offering and the Public Offering.

On or about December 14, 2021, the Company sold 494,459 shares of Hempacco common stock at $1.00/share to 5 investors, 4 of which were third parties. The family trust of Jerry Halamuda, Company director, purchased 50,000 of the shares for $50,000. The Company received gross proceeds of $494,459, and net proceeds of $333,309 after payment of commissions and expenses to the Company's registered broker and the payment of expenses associated with the private offering and the Public Offering.

On or about April 7, 2022, the Company sold 208,000 shares of Hempacco common stock at $2.00/share to nine investors, eight of which were third parties. The Company received gross proceeds of $416,000, and net proceeds of $339,475 after payment of commissions and expenses of $76,525 to the Company's registered broker and the payment of expenses associated with the private offering and the Public Offering.

On or about July 15, 2022, the Company acquired from Nery's Logistics, Inc. two cigarette production equipment lines together with multiple cigarette and cigar-related trademarks. The total acquisition price was deemed to be $4,000,000 to be paid solely by the issuance of 2,000,000 common shares of the Company. $3,400,000 was allocated to the value of the equipment, and the balance of $600,000 was allocated to the intangible assets.

On July 15, 2022, the Company also settled two vendor accounts payable balances totaling $100,000 by the issuance of 50,000 common shares of the Company.

On September 1, 2022 the Company sold 1,000,000 shares of Hempacco common stock at $6.00 per share to our underwriters pursuant to the IPO and the underwriting agreement with Boustead Securities, LLC. After deducting the underwriting commission and expenses, the Company received net proceeds of $5,468,812.

On September 6, 2022, Boustead Securities LLC submitted a notice of the exercise of the warrant purchase option, pursuant to paragraph 1.3.1 of the Underwriting Agreement. Boustead elected to exercise its right to purchase 70,000 common shares using the cashless basis formula into 54,928 shares of common stock.

On September 17, 2022 the Company entered a Marketing Services Agreement with North Equities Corp. of Toronto, Canada, effective September 19, 2022 for an initial period of 6-months. Compensation for the initial period will be by the issuance of 41,494 rule 144 restricted shares of the Company's common stock. This amount represents a market value of approximately $100,000 as of the effective date. The Company will also reimburse North Equities for all direct, pre-approved and reasonable expenses incurred in performing the marketing services. The share issuance

**NOTE 13 – COMMITMENTS AND CONTINGENCIES**

On or about October 7, 2022, the Company accepted service in a suit filed in the United States District Court for the Southern District of New York by Long Side Ventures LLC, R & T Sports Marketing Inc., Sierra Trading Corp., Taconic Group LLC, KBW Holdings LLC, Robert Huebsch and Ann E. Huebsch, Joseph Camberato, Joseph Crook, Sachin Jamdar, Michael Matilsky, Gerard Scollan, and Daisy Arnold (collectively "Plaintiffs") against Hempacco Co., Inc., Mexico Franchise Opportunity Fund, LP, Sandro Piancone, Jorge Olson, Neville Pearson, Stuart Titus, Jerry Halamuda, Retail Automated Concepts, Inc. f/k/a Vidbox Mexico Inc., and Vidbox Mexico S.A. De C.V. (collectively "Defendants") (Case No. 1:22-cv-08152 (ALC)), alleging that (i) Plaintiffs previously received a judgment (the "Judgment") in a New York state court action (the "State Action") against Retail Automated Concepts, Inc. ("RAC") and Vidbox Mexico S.A. De C.V. ("Vidbox Mexico"), for breach of promissory notes issued by RAC to Defendants in 2018 and guaranteed by Vidbox Mexico, and (ii) prior to the filing of the State Action, Defendants fraudulently transferred and commingled assets, specifically 600 retail kiosks, in order to avoid enforcement of the Judgment, with Plaintiffs seeking monetary damages from Defendants. On or about November 29, 2022, the court granted Defendants' request to file a motion to dismiss the suit, and on December 30, 2022, Defendants filed the motion to dismiss the suit for failure to state a claim and lack of personal jurisdiction. Defendants believe the suit is without merit and intend to defend the matter vigorously.

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**NOTE 14 – SUBSEQUENT EVENTS**

The Company has evaluated subsequent events through February 3, 2023, the date of issuance of these financial statements.

On October 4, 2022, we issued North Equities USA Ltd. ("North") 41,494 shares of Company common stock for six months of marketing services to be rendered by North to us, commencing on September 19, 2022, and including content management of our YouTube channel, establishment of a brand ambassador, and social media services.

On October 12, 2022, the Company entered a Broadcasting and Billboard Agreement with FMW Media Works LLC ("FMW") of Hauppauge, New York, for a period of three months. FMW will produce an informative TV show which will discuss the Company and its business. Total compensation will be made by the issuance of 63,292 restricted shares of Company common stock.

In October 2022, we entered into a joint venture agreement with Sonora Paper Co., Inc., a California corporation ("Sonora"), to form a joint venture entity in Delaware, Hempacco Paper Co., Inc., which will market and sell hemp rolling papers. Pursuant to the agreement, the joint venture entity will be owned 80% by us and 20% by Sonora, we are required to manufacture and package joint venture product and provide accounting, inventory management, staff training, and trade show and marketing services for the joint venture entity, and Sonora is required to provide its patented and patent-pending technologies for the joint venture's use, with the joint venture obligated to pay royalties of $0.0025 per paper cone manufactured by the joint venture entity and provide lodging for Sonora's director, Daniel Kempton.

In November 2022, we entered into a joint venture agreement with High Sierra Technologies, Inc. ("High Sierra"), a Nevada corporation and subsidiary of High Sierra Technologies, Inc., a Colorado corporation, to form a joint venture entity in Nevada, Organipure, Inc., which will market and sell hemp smokables products. Pursuant to the agreement, the joint venture entity will be owned will be owned 50% by each of us and High Sierra, with each of us contributing $1,000 to the joint venture initially, we are required to manufacture joint venture product, High Sierra is required to process raw hemp biomass initially, and each of us is required to provide joint accounting, inventory management, staff training, and trade show and marketing services for the joint venture entity.

In January 2023, we entered into a joint venture agreement with Alfalfa Holdings, LLC ("Alfalfa"), a California limited liability company, to operate a joint venture entity in California, HPDG, LLC (the "Joint Venture"), which will market and sell hemp smokables products. Pursuant to the agreement, the Joint Venture will be owned 50% by each of us and Alfalfa, we are required to fund $10,000 to the Joint Venture, we are required to manufacture Joint Venture product and provide accounting, inventory management, staff training, and trade show and marketing services for the Joint Venture, and Alfalfa is required to provide online marketing and promotion, design and branding, and brand management and development services to the Joint Venture, as well as Snoop Dogg attendance and appearances at Joint Venture events subject to professional availability, and subject to a services agreement between Alfalfa, the Joint Venture, and Spanky's Clothing, Inc., and Calvin Broadus, Jr. p/k/a "Snoop Dogg" (collectively "Talent"). Pursuant to the services agreement, Talent will endorse the Joint venture's smokable hemp products and serve as a spokesperson for the products in the United States, and the Joint Venture shall (i) pay Talent's legal expenses of $7,500 in connection with entering into the Joint Venture agreement and services agreement; (ii) cause the Company to issue to Talent a fully vested warrant to acquire 450,000 shares of Company common stock at a strike price of $1.00 per share (the "Talent Warrants"); (iii) cause the Company to issue to Talent's designee a fully vested warrant to acquire 50,000 shares of Company common stock at a strike price of $1.00 per share (the "Talent Designee Warrants"); and (iv) pay Talent royalties of 10% of Joint Venture gross revenue, with minimum annual royalty payments of $450,000 by the end of the first two years of the initial term of the services agreement, an additional $600,000 by the end of the third year of the initial term, and an additional $1,200,000 by the end of the fourth year of the initial term. On or about January 30, 2023, the Company issued the Talent Warrants and Talent Designee Warrants as required by the services agreement between the Joint Venture, Alfalfa, and Talent.

Subsequent to September 30, 2022, the Company has loaned GGII and related entities an additional approximately $1,295,000. As of the date of this filing, total amounts due from GGII and related entities is approximately $1,356,000.

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![hemp_s1img3.jpg](hemp_s1img3.jpg)

Hempacco Co., Inc.

**_____________________________________**

**PRELIMINARY PROSPECTUS**

**_____________________________________**

*Underwriter*

BOUSTEAD SECURITIES, LLC

 **___________, 2023**

Until ____________, 2023, 25 days after the date of this prospectus, all dealers that buy, sell or trade our securities, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to the dealers' obligation to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions.

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**PART II**

**INFORMATION NOT REQUIRED IN THE PROSPECTUS**

**Item 13. Other Expenses of Issuance and Distribution**

The following table sets forth the costs and expenses, other than underwriting discounts and commissions, payable by us in connection with the sale of common stock being registered. All amounts, other than the SEC registration fee, are estimates. We will pay all these expenses.

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|  | **Amount** |
| SEC registration fee | $711.91 |
| FINRA filing fee | 3000 |
| Accounting fees and expenses | 50000 |
| Legal fees and expenses | 100000 |
| Transfer agent fees and expenses | 5000 |
| Printing and related fees | 10000 |
| Miscellaneous | 20000 |
| **Total** | $188711.91 |

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**Item 14. Indemnification of Directors and Officers**

We are a Nevada corporation. The Nevada Revised Statutes and certain provisions of our bylaws under certain circumstances provide for indemnification of our officers, directors and controlling persons against liabilities which they may incur in such capacities. A summary of the circumstances in which such indemnification is provided for is contained herein, but this description is qualified in its entirety by reference to our bylaws and to the statutory provisions.

In general, any officer, director, employee or agent may be indemnified against expenses, fines, settlements or judgments arising in connection with a legal proceeding to which such person is a party, if that person's actions were in good faith, were believed to be in our best interest, and were not unlawful. Unless such person is successful upon the merits in such an action, indemnification may be awarded only after a determination by independent decision of our board of directors, by legal counsel, or by a vote of our stockholders, that the applicable standard of conduct was met by the person to be indemnified.

The circumstances under which indemnification is granted in connection with an action brought on our behalf is generally the same as those set forth above; however, with respect to such actions, indemnification is granted only with respect to expenses actually incurred in connection with the defense or settlement of the action. In such actions, the person to be indemnified must have acted in good faith and in a manner believed to have been in our best interest, and have not been adjudged liable for negligence or misconduct.

Indemnification may also be granted pursuant to the terms of agreements which may be entered in the future or pursuant to a vote of stockholders or directors. The Nevada Revised Statutes also grant us the power to purchase and maintain insurance which protects our officers and directors against any liabilities incurred in connection with their service in such a position, and such a policy may be obtained by us.

To the maximum extent permitted by law, our articles of incorporation eliminate or limit the liability of our directors to us or our shareholders for monetary damages for breach of a director's fiduciary duty as a director.

We intend to enter into separate indemnification agreements with our directors and officers. Each indemnification agreement will provide, among other things, for indemnification to the fullest extent permitted by law and our articles of incorporation and bylaws against any and all expenses, judgments, fines, penalties and amounts paid in settlement of any claim. The indemnification agreements will provide for the advancement or payment of all expenses to the indemnitee and for reimbursement to us if it is found that such indemnitee is not entitled to such indemnification under applicable law and our articles of incorporation and bylaws.

We are in the process of obtaining standard policies of insurance under which coverage is provided (a) to our directors and officers against loss rising from claims made by reason of breach of duty or other wrongful act, and (b) to us with respect to payments which we may make to such officers and directors pursuant to the above indemnification provision or otherwise as a matter of law.

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The underwriting agreement, filed as Exhibit 1.1 to this registration statement, will provide for indemnification, under certain circumstances, by the underwriters of us and our officers and directors for certain liabilities arising under the Securities Act or otherwise.

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers or persons controlling us under the foregoing provisions, we have been informed that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable.

**Item 15. Recent Sales of Unregistered Securities**

During the past three years, we issued the following securities, which were not registered under the Securities Act.

On or about April 1, 2019, the Company issued 8,000,000 shares of common stock to an entity controlled by its founder and CEO, Sandro Piancone, in consideration of founding services valued at $80,000.

On October 22, 2019, the Company entered into a Kiosk Acquisition Agreement with Mexico Franchise Opportunity Fund LP ("MFOF"), a related party entity owned approximately 31% by the Company's founder and CEO, Sandro Piancone, and approximately 25% by the Company's founder, Jorge Olson, to purchase 600 vending kiosks for total consideration of $3,638,357, payable by the issuance of 8,000,000 shares of Series A Preferred Shares of the Company to MFOF on or about the same date.

On or about November 6, 2019, the Company issued 400,000 shares of common stock to an entity controlled by its founder, Jorge Olson, in consideration of founding services valued at $4,000.

On or about February 17, 2020, the Company issued 25,000 shares of common stock to a lender (Jerry Halamuda, now considered a related party as he was appointed as a member of the Company's Board of Directors in July 2021) as additional consideration for the lender's loan of $50,000 to the Company. On or about May 17, 2020, the Company issued an additional 25,000 shares of common stock to the lender in consideration of the lender's loan maturity date extension to August 17, 2020, from May 17, 2020.

On or about November 21, 2020, the Company issued 28,000 shares of common stock to two third-party lenders for conversion of debt with 25,000 of such shares issued upon conversion of principal of $25,000, and 3,000 of such shares issued upon conversion of accrued interest of $3,000.

On May 21, 2021, the Company issued 357,006 shares of common stock to eight third-party lenders shares for conversion of debt owed to the lenders, with 336,500 of such shares issued upon conversion of principal of $336,500, and 20,506 of such shares issued upon conversion of accrued interest of $20,506.

On May 21, 2021, the Company issued 127,016 shares of common stock to Mr. Halamuda (now considered a related party as he was appointed as a member of the Company's Board of Directors in July 2021) for conversion of debt owed to Mr. Halamuda, with 125,000 of such shares issued upon conversion of principal of $125,000, and 2,016 of such shares issued upon conversion of accrued interest of $2,016.

On May 21, 2021, the Company issued 51,030 shares of common stock to a lender (Dr. Stuart Titus, now considered a related party as he was appointed as the Company's Chairman of the Board of Directors in July 2021) for conversion of debt owed to Dr. Titus, with 50,000 of such shares issued upon conversion of principal of $50,000, and 1,030 of such shares issued upon conversion of accrued interest of $1,030.

On May 21, 2021, the Company issued 8,757,479 shares of common stock to its preferred shareholder, Mexico Franchise Opportunities Fund LP ("MFOF"), a related party entity owned approximately 31% by the Company's founder and CEO, Mr. Piancone, and approximately 25% by the Company's founder, Mr. Olson, upon conversion of 8,000,000 shares of Series A Preferred Shares of the Company into common stock at $1.00 per share, and payment of 757,479 shares of common stock for accrued dividends of $757,479, due on the preferred shares, at $1.00 per share.

On May 21, 2021, the Company issued 170,000 shares of common stock to an entity controlled by the Company's founder and CEO, Mr. Piancone, in satisfaction of $170,000 of accrued fees for management services owed to the entity by the Company.

On May 21, 2021, the Company issued 185,000 shares of common stock to an entity controlled by the Company's founder, Mr. Olson, in satisfaction of $185,000 of accrued fees for management services owed to the entity by the Company.

On May 21, 2021, the Company issued 170,000 shares of common stock to an entity controlled by the Company's founder and CEO, Mr. Piancone, for rent of the Company's manufacturing and office facility from January 1, 2020, to May 31, 2021, valued at $171,500.

On May 21, 2021, the Company issued 100,000 shares of common stock to a third party for information technology, software development, and kiosk technical services to the Company valued at $100,000.

On or about December 6, 2021, the Company sold 805,541 shares of Company common stock at $1.00 per share to 19 investors, 17 of which were third parties. Neville Pearson, Company CFO, and Dr. Stuart Titus, Company director, purchased 50,000 of the shares for $50,000, and 100,000 of the shares for $100,000, respectively. The Company received gross proceeds of $805,541, and net proceeds of $724,255 after payment of commissions and expenses to the Company's registered broker and the payment of expenses associated with the private offering and the initial public offering hereunder.

On or about December 14, 2021, the Company sold 494,459 shares of Company common stock at $1.00 per share to 5 investors, 4 of which were third parties. The family trust of Jerry Halamuda, Company director, purchased 50,000 of the shares for $50,000. The Company received gross proceeds of $494,459, and net proceeds of $333,309.98 after payment of commissions and expenses to the Company's registered broker and the payment of expenses associated with the private offering and the initial public offering hereunder.

On or about April 7, 2022, the Company sold 208,000 shares of Company common stock at $2.00 per share to 9 investors, all of which were third parties. The Company received gross proceeds of $416,000, and net proceeds of $355,475 after payment of commissions and expenses to the Company's registered broker and the payment of expenses associated with the private offering and the initial public offering hereunder. These shares were sold pursuant to the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended, and Rule 506(b) promulgated thereunder, as there was no general solicitation in the offering, the investors were accredited, and the transaction did not involve a public offering.

On or about June 10, 2022, the Company issued 56,592 shares of Company common stock to its lender, Mario Taverna, in conversion of $50,000 in principal and $6,592 of accrued interest due to Mr. Taverna under a convertible promissory note.

On or about July 15, 2022, the Company issued 2,000,000 shares of Company common stock to Nery's Logistics, Inc. in consideration of the acquisition of two cigarette production equipment lines and multiple trademarks from it.

On July 15, 2022, the Company settled two vendor accounts payable balances totaling $100,000 by issuing 50,000 shares of Company common stock (25,000 shares issued to each of the vendors) to the vendors.

On August 29, 2022, the Company entered into an underwriting agreement with Boustead Securities, LLC ("Boustead"), in connection with the initial public offering of the Company's common stock (the "IPO"), pursuant to which the Company agreed to (i) sell 1,000,000 shares of its common stock (the "IPO Shares") at a price to the public of $6.00 per share, (ii) issue Boustead warrants to purchase 70,000 shares of common stock, exercisable from September 1, 2022, through August 29, 2027, and initially exercisable at $9.00 per share (the "Boustead Warrants"), and (iii) grant Boustead an option for a period of 45 days to purchase up to an additional 150,000 shares of common stock. On September 1, 2022, the IPO closed, and the Company (i) issued the IPO Shares for total gross proceeds of $6,000,000, and (ii) issued Boustead the Boustead Warrants. On September 6, 2022, Boustead exercised the Boustead Warrants, which were part of Boustead's compensation as underwriter in the IPO, in full on a cashless basis, and on September 7, 2022, the Company issued 54,928 shares of common stock to Boustead.

On September 6, 2022, the Company entered into a settlement agreement with Titan General Agency Ltd. ("Titan"), the Company's creditor equipment financier which was owed approximately $1,450,000 by the Company as of September 6, 2022 (the "Titan Debt"), pursuant to which the Company agreed to pay Titan $250,000 in cash (the "Settlement Cash Payment") and issue Titan 266,667 shares of Company common stock (the "Settlement Shares"), in full satisfaction of the Titan Debt. On or about September 8, 2022, the Company issued Titan the Settlement Shares.

On October 4, 2022, the Company issued North Equities USA Ltd. ("North") 41,494 shares of Company common stock for six months of marketing services to be rendered by North to the Company, commencing on September 19, 2022, and including content management for the Company's YouTube channel, establishment of a brand ambassador, and social media services.

On October 12, 2022, the Company issued FMW Media Works LLC ("FMW") 63,292 shares of Company common stock, in consideration of TV show production and broadcasting services to be rendered to the Company by FMW.

On or about January 30, 2023, the Company issued the Talent Warrants and Talent Designee Warrants described in the "Business" section on page 40 herein as required by the services agreement between the Joint Venture, Alfalfa, and Talent.

Except for the IPO Shares and the shares underlying the Boustead Warrants, which were registered under the Securities Act of 1933, as amended, the other securities described in this Item 15 were issued in reliance on the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933, as amended, as there was no general solicitation, and the transactions did not involve a public offering. No underwriter was engaged in connection with the sales of those securities, but Boustead was engaged as the underwriter in connection with the sale of the IPO Shares in the IPO. The Company has reason to believe that all of the purchasers of Company securities (other than the IPO Shares and the shares underlying the Boustead Warrants, which were registered) were familiar with or had access to information concerning the operations and financial conditions of the Company, and all of those individuals purchasing those securities represented that they were accredited investors, acquiring the shares for investment and without a view to the distribution thereof. At the time of issuance, all of the foregoing securities (except for the IPO Shares and the shares underlying the Boustead Warrants) were deemed to be restricted securities for purposes of the Securities Act, and the certificates representing such securities bore legends to that effect.

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| 70 |
| *[**Table of Contents**](#toc)* |

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**Item 16. Exhibits**

(a) Exhibits.

---

| | |
|:---|:---|
| **Exhibit No.** | **Description** |
| [1.1](http://www.sec.gov/Archives/edgar/data/1892480/000147793222006638/hemp_ex11.htm) | [Underwriting Agreement, between Hempacco Co., Inc. and Boustead Securities, LLC, dated August 29, 2022 (incorporated by reference to Exhibit 1.1 to Current Report on Form 8-K filed on September 2, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222006638/hemp_ex11.htm) |
| [1.2](hemp_ex12.htm) | [Form of Underwriting Agreement](hemp_ex12.htm) |
| [3.1](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex31.htm) | [Articles of Incorporation (incorporated by reference to Exhibit 3.1 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex31.htm) |
| [3.2](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex32.htm) | [Amended and Restated Articles of Incorporation dated April 23, 2021 (incorporated by reference to Exhibit 3.2 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex32.htm) |
| [3.3](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex33.htm) | [Amended and Restated Articles of Incorporation dated September 28, 2021 (incorporated by reference to Exhibit 3.3 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex33.htm) |
| [3.4](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex34.htm) | [Bylaws of Hempacco Co., Inc. (incorporated by reference to Exhibit 3.4 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex34.htm) |
| [4.1](hemp_ex12.htm) | [Form of Representatives' Warrant (included in Exhibit 1.2)](hemp_ex12.htm) |
| [5.1](hemp_ex51.htm) | [Opinion of Brunson Chandler & Jones, PLLC as to the legality of the shares](hemp_ex51.htm) |
| [10.1](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex101.htm) | [Agreement for Share Exchange between Hempacco Co., Inc. and Green Globe International, Inc., dated May 21, 2021 (incorporated by reference to Exhibit 10.1 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex101.htm) |
| [10.2](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex102.htm) | [Patent License Agreement between Hempacco Co., Inc., and Old Belt Extracts, LLC d/b/a Open Book Extracts, dated April 1, 2021 (incorporated by reference to Exhibit 10.2 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex102.htm) |
| [10.3](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex103.htm) | [Limited Liability Company Agreement of Cali Vibes D8 LLC, dated April 20, 2021 (incorporated by reference to Exhibit 10.3 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex103.htm) |
| [10.4](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex104.htm) | [Joinder Agreement between Cali Vibes D8 LLC, Hempacco Co., Inc., and BX2SD Hospitality, LLC, dated June 3, 2021 (incorporated by reference to Exhibit 10.4 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex104.htm) |
| [10.5](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex105.htm) | [Assignment Agreement between Hempacco Co., Inc. and Green Globe International, Inc., dated December 14, 2021 (incorporated by reference to Exhibit 10.5 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex105.htm) |
| [10.6](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex106.htm) | [Joinder Agreement of Hemp Hop Smokables LLC, by Hempacco Co., Inc., dated December 14, 2021 (incorporated by reference to Exhibit 10.6 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex106.htm) |
| [10.7](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex107.htm) | [Joint Venture Agreement between Hempacco Co., Inc. and Cheech and Chong's Cannabis Company, dated January 1, 2022 (incorporated by reference to Exhibit 10.7 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex107.htm) |
| [10.8](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex108.htm) | [Joint Venture Agreement between Hempacco Co., Inc. and StickIt Ltd., dated January 19, 2022 (incorporated by reference to Exhibit 10.8 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex108.htm) |
| [10.9](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex109.htm) | [Purchase Finance Agreement between Hempacco Co., Inc., and Titan General Agency Ltd., dated December 3, 2019 (incorporated by reference to Exhibit 10.9 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex109.htm) |
| [10.10](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1010.htm) | [Loan Agreement between Hempacco Co., Inc. and Courier Labs, LLC, dated June 15, 2020 (incorporated by reference to Exhibit 10.10 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1010.htm) |
| [10.11](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1011.htm) | [Security Agreement between Hempacco Co., Inc. and Courier Labs, LLC, dated June 15, 2020 (incorporated by reference to Exhibit 10.11 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1011.htm) |
| [10.12](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1012.htm) | [Side Letter Agreement & Loan Extension between Hempacco Co., Inc. and Courier Labs, LLC (incorporated by reference to Exhibit 10.12 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1012.htm) |
| [10.13](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1013.htm) | [12% 6 Month Note issued to Mario Taverna, dated May 4, 2021 (incorporated by reference to Exhibit 10.13 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1013.htm) |
| [10.14](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1014.htm) | [Note Extension Agreement between Hempacco Co., Inc. and Mario Taverna, dated November 5, 2021 (incorporated by reference to Exhibit 10.14 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1014.htm) |
| [10.15](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1015.htm) | [Convertible Promissory Note issued to Miguel Cambero Villasenor, dated May 6, 2021 (incorporated by reference to Exhibit 10.15 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1015.htm) |
| [10.16](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1016.htm) | [Convertible Promissory Note issued to Miguel Cambero Villasenor, dated June 7, 2021 (incorporated by reference to Exhibit 10.16 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1016.htm) |
| [10.17](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1017.htm) | [Convertible Promissory Note issued to Ernest Sparks and Julee A. Sparks, Joint Tenants, dated May 10, 2021 (incorporated by reference to Exhibit 10.17 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1017.htm) |
| [10.18](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1018.htm) | [12% One Year Note issued to Dennis Holba & Raffaella Marsh, dated November 12, 2019 (incorporated by reference to Exhibit 10.18 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1018.htm) |
| [10.19](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1019.htm) | [Secured Promissory Note issued to Jerry Halamuda, dated February 17, 2020 (incorporated by reference to Exhibit 10.19 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1019.htm) |
| [10.20](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1020.htm) | [Promissory Note issued to Jerry Halamuda, dated February 16, 2021 (incorporated by reference to Exhibit 10.20 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1020.htm) |
| [10.21](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1021.htm) | [Promissory Note Agreement Amendment 1 between Hempacco Co., Inc. and Jerry Halamuda, dated May 17, 2020 (incorporated by reference to Exhibit 10.21 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1021.htm) |
| [10.22](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1022.htm) | [12% One Year Note issued to Mario Taverna, dated March 5, 2021 (incorporated by reference to Exhibit 10.22 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1022.htm) |
| [10.23](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1023.htm) | [12% One Year Note issued to Mario Taverna, dated March 10, 2021 (incorporated by reference to Exhibit 10.23 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1023.htm) |
| [10.24](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1024.htm) | [12% One Year Note issued to Valentino Mordini, dated March 9, 2021 (incorporated by reference to Exhibit 10.24 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1024.htm) |
| [10.25](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1025.htm) | [12% One Year Note issued to Romeo Fiori, dated March 10, 2021 (incorporated by reference to Exhibit 10.25 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1025.htm) |
| [10.26](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1026.htm) | [12% One Year Note issued to J Lin Inc., dated March 15, 2021 (incorporated by reference to Exhibit 10.26 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1026.htm) |
| [10.27](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1027.htm) | [12% One Year Note issued to Sylvester Barnes, dated April 1, 2021 (incorporated by reference to Exhibit 10.27 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1027.htm) |
| [10.28](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1028.htm) | [12% One Year Note issued to Roger Ladd, dated April 13, 2021 (incorporated by reference to Exhibit 10.28 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1028.htm) |
| [10.29](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1029.htm) | [Standard Industrial/Commercial Multi-Tenant Lease Agreement between Hempacco Co., Inc. and Primus Logistics, Inc., dated January 1, 2020 (incorporated by reference to Exhibit 10.29 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1029.htm) |
| [10.30\*](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1030.htm) | [Sales and Marketing Agreement between Hempacco Co., Inc., and Cube17, Inc., dated November 6, 2019 (incorporated by reference to Exhibit 10.30 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1030.htm) |
| [10.31\*](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1031.htm) | [Consulting & Marketing Agreement between Hempacco Co., Inc., and Strategic Global Partners, Inc., dated January 3, 2020 (incorporated by reference to Exhibit 10.31 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1031.htm) |
| [10.32\*](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1032.htm) | [Consulting & Marketing Agreement between Hempacco Co., Inc., and UST Mexico, Inc., dated January 3, 2020 (incorporated by reference to Exhibit 10.32 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1032.htm) |
| [10.33\*](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1033.htm) | [Interim Consulting Agreement between Hempacco Co., Inc. and Neville Pearson, dated March 1, 2021 (incorporated by reference to Exhibit 10.33 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1033.htm) |
| [10.34\*](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1034.htm) | [Employment Agreement between Hempacco Co., Inc. and Sandro Piancone, dated January 20, 2022 (incorporated by reference to Exhibit 10.34 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1034.htm) |
| [10.35\*](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1035.htm) | [Employment Agreement between Hempacco Co., Inc. and Neville Pearson, dated January 20, 2022 (incorporated by reference to Exhibit 10.35 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1035.htm) |
| [10.36\*](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1036.htm) | [Employment Agreement between Hempacco Co., Inc. and Jorge Olson, dated February 3, 2022 (incorporated by reference to Exhibit 10.36 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_ex1036.htm) |
| [10.37\*](http://www.sec.gov/Archives/edgar/data/1892480/000147793222006638/hemp_ex101.htm) | [Indemnification Agreement, between Hempacco Co., Inc. and Sandro Piancone, dated August 29, 2022 (incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K filed on September 2, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222006638/hemp_ex101.htm) |
| [10.38\*](http://www.sec.gov/Archives/edgar/data/1892480/000147793222006638/hemp_ex102.htm) | [Indemnification Agreement, between Hempacco Co., Inc. and Neville Pearson, dated August 29, 2022 (incorporated by reference to Exhibit 10.2 to Current Report on Form 8-K filed on September 2, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222006638/hemp_ex102.htm) |
| [10.39\*](http://www.sec.gov/Archives/edgar/data/1892480/000147793222006638/hemp_ex103.htm) | [Indemnification Agreement, between Hempacco Co., Inc. and Jorge Olson, dated August 29, 2022 (incorporated by reference to Exhibit 10.3 to Current Report on Form 8-K filed on September 2, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222006638/hemp_ex103.htm) |
| [10.40\*](http://www.sec.gov/Archives/edgar/data/1892480/000147793222006638/hemp_ex104.htm) | [Indemnification Agreement, between Hempacco Co., Inc. and Stuart Titus, dated August 29, 2022 (incorporated by reference to Exhibit 10.4 to Current Report on Form 8-K filed on September 2, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222006638/hemp_ex104.htm) |
| [10.41\*](http://www.sec.gov/Archives/edgar/data/1892480/000147793222006638/hemp_ex105.htm) | [Indemnification Agreement, between Hempacco Co., Inc. and Jerry Halamuda, dated August 29, 2022 (incorporated by reference to Exhibit 10.5 to Current Report on Form 8-K filed on September 2, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222006638/hemp_ex105.htm) |
| [10.42\*](http://www.sec.gov/Archives/edgar/data/1892480/000147793222006638/hemp_ex106.htm) | [Indemnification Agreement, between Hempacco Co., Inc. and Miki Stephens, dated August 29, 2022 (incorporated by reference to Exhibit 10.6 to Current Report on Form 8-K filed on September 2, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222006638/hemp_ex106.htm) |
| [10.43\*](http://www.sec.gov/Archives/edgar/data/1892480/000147793222006638/hemp_ex107.htm) | [Independent Director Agreement, between Hempacco Co., Inc. and Miki Stephens, dated August 29, 2022 (incorporated by reference to Exhibit 10.7 to Current Report on Form 8-K filed on September 2, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222006638/hemp_ex107.htm) |
| [10.44](http://www.sec.gov/Archives/edgar/data/1892480/000147793222002874/hemp_ex1039.htm) | [Broker Representation Agreement between Hempacco Co., Inc. and Wizards and Kings LLC, dated November 23, 2021 (incorporated by reference to Exhibit 10.39 to Amendment No. 1 to Registration Statement on Form S-1 filed on May 3, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222002874/hemp_ex1039.htm) |
| [10.45](http://www.sec.gov/Archives/edgar/data/1892480/000147793222005650/hemp_ex1040.htm) | [Asset Purchase Agreement between Hempacco Co., Inc. and Nery's Logistics, Inc., dated July 12, 2022 (incorporated by reference to Exhibit 10.40 to Amendment No. 4 to Registration Statement on Form S-1 filed on August 5, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222005650/hemp_ex1040.htm) |
| [10.46](http://www.sec.gov/Archives/edgar/data/1892480/000147793222005650/hemp_ex1041.htm) | [8% 90 Day Note issued to Jerry Halamuda, dated May 18, 2022 (incorporated by reference to Exhibit 10.41 to Amendment No. 4 to Registration Statement on Form S-1 filed on August 5, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222005650/hemp_ex1041.htm) |
| [10.47](http://www.sec.gov/Archives/edgar/data/1892480/000147793222005650/hemp_ex1042.htm) | [Promissory Note Agreement Amendment 1 between Hempacco Co., Inc. and Jerry Halamuda, dated June 18, 2022 (incorporated by reference to Exhibit 10.42 to Amendment No. 4 to Registration Statement on Form S-1 filed on August 5, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222005650/hemp_ex1042.htm) |
| [10.48](hemp_ex1048.htm) | [Joint Venture Agreement between Hempacco Co., Inc. and Sonora Paper Co., Inc., dated October 2, 2022](hemp_ex1048.htm) |
| [10.49](hemp_ex1049.htm) | [Joint Venture Agreement between Hempacco Co., Inc. and High Sierra Technologies, Inc., dated November 10, 2022](hemp_ex1049.htm) |
| [10.50](http://www.sec.gov/Archives/edgar/data/1892480/000147793223000689/hemp_ex101.htm) | [Operating Agreement between Hempacco Co., Inc., Alfalfa Holdings, LLC, and HPDG, LLC, dated January 24, 2023 (incorporated by reference to Exhibit 10.1 to Current Report on Form 8-K filed on February 2, 2023)](http://www.sec.gov/Archives/edgar/data/1892480/000147793223000689/hemp_ex101.htm)  |
| [14.1](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_exh141.htm) | [Code of Ethics and Business Conduct (incorporated by reference to Exhibit 14.1 to Registration Statement on Form S-1 filed on March 24, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222001592/hemp_exh141.htm) |
| [23.1](hemp_ex231.htm) | [Consent of dbbmckennon](hemp_ex231.htm) |
| [23.2](http://www.sec.gov/Archives/edgar/data/1892480/000147793222005650/hemp_ex51.htm) | [Consent of Brunson Chandler & Jones, PLLC (included in Exhibit 5.1)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222005650/hemp_ex51.htm) |
| 24.1 | Power of Attorney (included on the signature page of this registration statement) |
| [99.1](http://www.sec.gov/Archives/edgar/data/1892480/000147793222004450/hemp_ex995.htm) | [Form of Lock-Up Agreement between Underwriter and Shareholder, dated June 3, 2022 (incorporated by reference to Exhibit 99.5 to Amendment No. 2 to Registration Statement on Form S-1 filed on June 16, 2022)](http://www.sec.gov/Archives/edgar/data/1892480/000147793222004450/hemp_ex995.htm) |
| [99.2](hemp_ex992.htm) | [Settlement Agreement and Mutual Release between Hempacco Co., Inc. and Titan General Agency Ltd., dated September 6, 2022](hemp_ex992.htm) |
| [107](hemp_ex107.htm) | [Filing Fee Table](hemp_ex107.htm) |

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\* Executive compensation plan or arrangement.

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(b) Financial Statement Schedules.

All financial statement schedules are omitted because the information called for is not required or is shown either in the financial statements or in the notes thereto.

(b) Financial Statement Schedules.

All financial statement schedules are omitted because the information called for is not required or is shown either in the financial statements or in the notes thereto.

**Item 17. Undertakings**

The undersigned registrant hereby undertakes to provide to the underwriters at the closing specified in the underwriting agreement, certificates in such denominations and registered in such names as required by the underwriters to permit prompt delivery to each purchaser.

Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.

The undersigned registrant hereby undertakes:

(1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:

a. To include any prospectus required by section 10(a)(3) of the Securities Act of 1933;

b. To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement;

c. To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement.

(2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

(3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.

(4) That, for the purpose of determining liability under the Securities Act of 1933 to any purchaser:

a. If the registrant is relying on Rule 430B:

i. Each prospectus filed by the registrant pursuant to Rule 424(b)(3) shall be deemed to be part of the registration statement as of the date the filed prospectus was deemed part of and included in the registration statement; and

ii. Each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) as part of a registration statement in reliance on Rule 430B relating to an offering made pursuant to Rule 415(a)(1)(i), (vii), or (x) for the purpose of providing the information required by section 10(a) of the Securities Act of 1933 shall be deemed to be part of and included in the registration statement as of the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale of securities in the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the issuer and any person that is at that date an underwriter, such date shall be deemed to be a new effective date of the registration statement relating to the securities in the registration statement to which that prospectus relates, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such effective date, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such effective date; or

b. If the registrant is subject to Rule 430C, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use.

(5) That, for the purpose of determining liability of the registrant under the Securities Act of 1933 to any purchaser in the initial distribution of the securities the undersigned registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:

a. Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424;

b. Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;

c. The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and

d. Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.

The undersigned registrant hereby undertakes that:

(1) For purposes of determining any liability under the Securities Act, the information omitted from the form of prospectus filed as part of this registration statement in reliance upon Rule 430A and contained in a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective.

(2) For purposes of determining any liability under the Securities Act, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

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**SIGNATURES**

Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of San Diego, State of California, on February 3, 2023.

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| | |
|:---|:---|
| **Hempacco Co., Inc.** | **Hempacco Co., Inc.** |
| By:  | /s/ Sandro Piancone  |
|  | Sandro Piancone<br>Chief Executive Officer |

---

**POWER OF ATTORNEY**

Each person whose signature appears below constitutes and appoints Sandro Piancone as his or her true and lawful attorneys-in-fact and agents with full power of substitution and resubstitution, for him and his name, place stead, in any and all capacities, to sign any or all amendments (including post-effective amendments) to this registration statement and to file a new registration statement under Rule 461, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto said attorneys-in-fact and agents full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the foregoing, as fully to all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or their substitutes, may lawfully do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the dates indicated.

---

| | | |
|:---|:---|:---|
| **SIGNATURE** | **TITLE** | **DATE** |
| /s/ Sandro Piancone  | Chief Executive Officer, President and Director (principal executive officer) | February 3, 2023 |
| Sandro Piancone |  |  |
| /s/ Neville Pearson  | Chief Financial Officer (principal financial and accounting officer) | February 3, 2023 |
| Neville Pearson |  |  |
| /s/ Dr. Stuart Titus  | Chairman of the Board of Directors | February 3, 2023 |
| Dr. Stuart Titus |  |  |
| /s/ Jerry Halamuda  | Member of the Board of Directors | February 3, 2023 |
| Jerry Halamuda |  |  |
| /s/ Miki Stephens  | Member of the Board of Directors | February 3, 2023 |
| Miki Stephens |  |  |

---

73<br>

## Exhibit 1.2

**EXHIBIT 1.2**

**UNDERWRITING AGREEMENT**

[\*], 2023

Boustead Securities, LLC

6 Venture, Suite 395

Irvine, CA 92618

EF Hutton,

division of Benchmark Investments, LLC

590 Madison Avenue, 39<sup>th</sup> Floor

New York, New York 10022

*As Representatives of the several Underwriters named on Schedule 1 attached hereto*

Ladies and Gentlemen:

The undersigned, Hempacco Co., Inc., a Nevada corporation (the "**Company**"), hereby confirms its agreement (this "**Agreement**") with Boustead Securities, LLC and EF Hutton (hereinafter referred to as "you" (including its correlatives) or the "**Representatives**" and with the other underwriters named on <u>Schedule 1</u> hereto for which the Representatives are acting as representatives (the Representatives and such other underwriters being collectively called the "**Underwriters**" or, individually, an "**Underwriter**") as follows:

1. <u>Purchase and Sale of Shares</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1 *<u>Firm Shares</u>.*

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1.1. <u>Nature and Purchase of Firm Shares</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) On the basis of the representations and warranties herein contained, but subject to the terms and conditions herein set forth, the Company agrees to sell in the aggregate [\*] shares of common stock of the Company, par value $0.001 per share (the "**Common Stock**"), and each Underwriter agrees to purchase, severally and not jointly, at the Closing, an aggregate of [\*] shares ("**Firm Shares**") of the Common Stock.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) The Firm Shares are to be offered together to the public at the offering price per one Firm Share as set forth on <u>Schedule 2-A</u> hereto (the "**Purchase Price**"). The Underwriters, severally and not jointly, agree to purchase from the Company the number of Firm Shares set forth opposite their respective names on <u>Schedule 1</u> attached hereto and made a part hereof at the purchase price for one Firm Share of $[\*] (or 93% of the Purchase Price).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.1.2. <u>Firm Shares Payment and Delivery</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Delivery and payment for the Firm Shares shall be made at 10:00 a.m., Eastern time, on the second (2<sup>nd</sup>) Business Day following the effective date (the "**Effective Date**") of the Registration Statement (as defined in <u>Section 2.1.1</u> below) (or the third (3<sup>rd</sup>) Business Day following the Effective Date if the Registration Statement is declared effective after 4:01 p.m., Eastern time) or at such earlier time as shall be agreed upon by the Representatives and the Company, at the offices of Bevilacqua PLLC ("**Representatives' Counsel**"), or at such other place (or remotely by facsimile or other electronic transmission) as shall be agreed upon by the Representatives and the Company. The hour and date of delivery and payment for the Firm Shares is called the "**Closing Date**."

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Payment for the Firm Shares shall be made on the Closing Date by wire transfer in Federal (same day) funds, payable to the order of the Company upon delivery of the certificates (in form and substance satisfactory to the Underwriters) representing the Firm Shares (or through the facilities of the Depository Trust Company ("**DTC**")) for the account of the Underwriters. The Firm Shares shall be registered in such name or names and in such authorized denominations as the Representatives may request in writing prior to the Closing Date. The Company shall not be obligated to sell or deliver the Firm Shares except upon tender of payment by the Representatives for all of the Firm Shares. The term "**Business Day**" means any day other than a Saturday, a Sunday or a legal holiday or a day on which banking institutions are authorized or obligated by law to close in New York, New York.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2. *<u>Over-allotment Option</u>.*

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2.1. <u>Option Shares</u>. For the purposes of covering any over-allotments in connection with the distribution and sale of the Firm Shares, the Company hereby grants to the Underwriters an option (the "**Over-allotment Option**") to purchase, in the aggregate, up to [\*] additional shares of the Common Stock (the "**Option Shares**", and along with the Firm Shares, the "**Shares**"), representing fifteen percent (15%) of the Firm Shares sold in the offering, from the Company. The purchase price to be paid per Option Share shall be equal to the price per Option Share set forth in <u>Schedule 2-A</u>. The Shares shall be issued directly by the Company and shall have the rights and privileges described in the Registration Statement, the Pricing Disclosure Package and the Prospectus referred to below. The offering and sale of the Shares is herein referred to as the "**Offering**."

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2.2. <u>Exercise of Option</u>. The Over-allotment Option granted pursuant to <u>Section 1.2.1</u> hereof may be exercised by the Representatives as to all (at any time) or any part (from time to time) of the Option Shares within forty-five (45) days after the Effective Date. The Underwriters shall not be under any obligation to purchase any of the Option Shares prior to the exercise of the Over-allotment Option. The Over-allotment Option granted hereby may be exercised by the giving of written notice to the Company from the Representatives, setting forth the number of the Option Shares to be purchased and the date and time for delivery of and payment for the Option Shares (the "**Option Closing Date**"), which shall not be later than five (5) full Business Days after the date of the notice or such other time as shall be agreed upon by the Company and the Representatives, at the offices of Representatives' Counsel or at such other place (including remotely by facsimile or other electronic transmission) as shall be agreed upon by the Company and the Representatives. If such delivery and payment for the Option Shares does not occur on the Closing Date, the Option Closing Date will be as set forth in the notice. Upon exercise of the Over-allotment Option with respect to all or any portion of the Option Shares subject to the terms and conditions set forth herein, (i) the Company shall become obligated to sell to the Underwriters the number of the Option Shares specified in such notice and (ii) each of the Underwriters, acting severally and not jointly, shall purchase that portion of the total number of the Option Shares then being purchased as set forth in <u>Schedule 1</u> opposite the name of such Underwriter.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.2.3. <u>Payment and Delivery</u>. Payment for the Option Shares shall be made on the Option Closing Date by wire transfer in Federal (same day) funds, payable to the order of the Company upon delivery to you of certificates (in form and substance satisfactory to the Underwriters) representing the Option Shares (or through the facilities of DTC or via DWAC transfer) for the account of the Underwriters. The Option Shares shall be registered in such name or names and in such authorized denominations as the Representatives may request in writing prior to the Option Closing Date. The Company shall not be obligated to sell or deliver the Option Shares except upon tender of payment by the Representatives for applicable Option Shares. The Option Closing Date may be simultaneous with, but not earlier than, the Closing Date, and in the event that such time and date are simultaneous with the Closing Date, the term "Closing Date" share refer to the time and date of delivery of the Firm Shares and the Option Shares.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.3 *<u>Representatives' Warrants</u>*.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.3.1. <u>Purchase Warrants</u>. The Company hereby agrees to issue and sell to the Representatives (and/or their designees) on the Closing Date an option ("**Representatives' Warrants**") as applicable, five-year warrants for the purchase of a number of the Firm Shares equal to 7% of the number of the Firm Shares and Option Shares, if any, issued in the Offering, pursuant to a warrant in the form attached hereto as **<u>Exhibit A</u>**, at an initial exercise price of $[\*] (or 100% of the public offering price per Firm Share). The Representatives' Warrants and the Shares issuable upon exercise thereof are hereinafter referred to together as the "**Representatives' Securities**." The Representatives understand and agree that there are significant restrictions pursuant to FINRA Rule 5110 against transferring the Representatives' Warrants and the underlying Shares during the one hundred eighty (180) days after the Effective Date and by its acceptance thereof shall agree that it will not sell, transfer, assign, pledge or hypothecate the Representatives' Warrants, or any portion thereof, or be the subject of any hedging, short sale, derivative, put or call transaction that would result in the effective economic disposition of such securities for a period of one hundred eighty (180) days following the Effective Date other than as permitted by FINRA Rule 5110(e)(2).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.3.2. <u>Delivery</u>. Delivery of the Representatives' Warrants shall be made on the Closing Date and shall be issued in the name or names and in such authorized denominations as the Representatives may request.

2. <u>Representations and Warranties of the Company</u>. The Company represents and warrants to the Underwriters as of the Applicable Time (as defined below), as of the Closing Date and as of the Option Closing Date, if any, as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.1. <u>Filing of Registration Statement</u>.*

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1.1. <u>Pursuant to the Securities Act</u>. The Company has filed with the U.S. Securities and Exchange Commission (the "**Commission**") a registration statement, and an amendment or amendments thereto, on Form S-1 (File No. [\*]), including any related prospectus or prospectuses, for the registration of the Shares and the Representatives' Securities under the Securities Act of 1933, as amended (the "**Securities Act**"), which registration statement and amendment or amendments have been prepared by the Company in all material respects in conformity with the requirements of the Securities Act and the rules and regulations of the Commission under the Securities Act (the "**Securities Act Regulations**") and will contain all material statements that are required to be stated therein in accordance with the Securities Act and the Securities Act Regulations. Except as the context may otherwise require, such registration statement, as amended, on file with the Commission at the time the registration statement became effective (including the Preliminary Prospectus included in the registration statement, financial statements, schedules, exhibits and all other documents filed as a part thereof and all information deemed to be a part thereof as of the Effective Date pursuant to paragraph (b) of Rule 430A of the Securities Act Regulations (the "**Rule 430A Information**")), is referred to herein as the "**Registration Statement**." If the Company files any registration statement pursuant to Rule 462(b) of the Securities Act Regulations, then after such filing, the term "**Registration Statement**" shall include such registration statement filed pursuant to Rule 462(b). The Registration Statement has been declared effective by the Commission on the date hereof.

Each prospectus used prior to the effectiveness of the Registration Statement, and each prospectus that omitted the Rule 430A Information that was used after such effectiveness and prior to the execution and delivery of this Agreement, is herein called a "**Preliminary Prospectus**." The Preliminary Prospectus, subject to completion, dated [\*], 2023, that was included in the Registration Statement immediately prior to the Applicable Time is hereinafter called the "**Pricing Prospectus**." The final prospectus in the form first furnished to the Underwriters for use in the Offering is hereinafter called the "**Prospectus**." Any reference to the "**most recent Preliminary Prospectus**" shall be deemed to refer to the latest Preliminary Prospectus included in the Registration Statement.

"**Applicable Time**" means 4:00 p.m., Eastern time, on the date of this Agreement.

"**Issuer Free Writing Prospectus**" means any "issuer free writing prospectus," as defined in Rule 433 of the Securities Act Regulations ("**Rule 433**"), including without limitation any "free writing prospectus" (as defined in Rule 405 of the Securities Act Regulations) relating to the Shares that is (i) required to be filed with the Commission by the Company, (ii) a "road show that is a written communication" within the meaning of Rule 433(d)(8)(i), whether or not required to be filed with the Commission, or (iii) exempt from filing with the Commission pursuant to Rule 433(d)(5)(i) because it contains a description of the Shares or of the Offering that does not reflect the final terms, in each case in the form filed or required to be filed with the Commission or, if not required to be filed, in the form retained in the Company's records pursuant to Rule 433(g).

"**Issuer General Use Free Writing Prospectus**" means any Issuer Free Writing Prospectus that is intended for general distribution to prospective investors (other than a "*bona fide* electronic road show," as defined in Rule 433 (the "**Bona Fide Electronic Road Show**")), as evidenced by its being specified in <u>Schedule 2-B</u> hereto.

"**Issuer Limited Use Free Writing Prospectus**" means any Issuer Free Writing Prospectus that is not an Issuer General Use Free Writing Prospectus.

"**Pricing Disclosure Package**" means any Issuer General Use Free Writing Prospectus issued at or prior to the Applicable Time, the Pricing Prospectus and the information included on <u>Schedule 2-A</u> hereto, all considered together.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1.2. <u>Pursuant to the Exchange Act</u>. The Company has filed with the Commission a Form 8-A (File Number 001-41487) providing for the registration pursuant to Section 12(b) under the Securities Exchange Act of 1934, as amended (the "**Exchange Act**"), of the Common Stock. The registration of the Common Stock under the Exchange Act has become effective on or prior to the date hereof. The Company has taken no action designed to, or likely to have the effect of, terminating the registration of the Common Stock under the Exchange Act, nor has the Company received any notification that the Commission is contemplating terminating such registration.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.2. <u>Share Exchange Listing</u>.* The Shares and the shares of Common Stock underlying the Representatives' Warrants have been approved for listing on the Nasdaq Capital Market (the "**Exchange**"), and the Company has taken no action designed to, or likely to have the effect of, delisting of the Shares or the shares of Common Stock underlying the Representatives' Warrants from the Exchange, nor has the Company received any written notification that the Exchange is contemplating terminating such listing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.3. <u>No Stop Orders, etc</u>.* Neither the Commission nor, to the Company's knowledge, any state regulatory authority has issued any written order preventing or suspending the use of the Registration Statement, any Preliminary Prospectus or the Prospectus or has instituted or, to the Company's knowledge, threatened to institute, any proceedings with respect to such an order. The Company has complied with each request (if any) from the Commission for additional information.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.4. <u>Disclosures in Registration Statement</u>.*

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4.1. <u>Compliance with Securities Act and 10b-5 Representation</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Each of the Registration Statement and any post-effective amendment thereto, at the time it became effective, complied in all material respects with the requirements of the Securities Act and the Securities Act Regulations. Each Preliminary Prospectus, including the prospectus filed as part of the Registration Statement as originally filed or as part of any amendment or supplement thereto, and the Prospectus, at the time each was filed with the Commission, complied in all material respects with the requirements of the Securities Act and the Securities Act Regulations. Each Preliminary Prospectus delivered to the Underwriters for use in connection with this Offering and the Prospectus was or will be identical to the electronically transmitted copies thereof filed with the Commission pursuant to EDGAR, except to the extent permitted by Regulation S-T.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Neither the Registration Statement nor any amendment thereto, at its effective time, as of the Applicable Time, at the Closing Date or at any Option Closing Date (if any), contained, contains or will contain an untrue statement of a material fact or omitted, omits or will omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) The Pricing Disclosure Package, as of the Applicable Time, at the Closing Date or at any Option Closing Date (if any), did not, does not and will not include an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; and each Issuer Limited Use Free Writing Prospectus hereto does not conflict with the information contained in the Registration Statement, any Preliminary Prospectus, the Pricing Prospectus or the Prospectus, and each such Issuer Limited Use Free Writing Prospectus, as supplemented by and taken together with the Pricing Prospectus as of the Applicable Time, did not include an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading; *provided*, *however*, that this representation and warranty shall not apply to statements made in reliance upon and in conformity with written information furnished to the Company in writing with respect to the Underwriters by the Representatives expressly for use in the Registration Statement, the Pricing Prospectus or the Prospectus or any amendment thereof or supplement thereto. The parties acknowledge and agree that such information provided by or on behalf of any Underwriter consists solely of the disclosure contained in the "Underwriting" subsections "- Discounts and Commissions; Expenses," and "Representatives' Warrants," of the Prospectus (the "**Underwriters' Information**").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Neither the Prospectus nor any amendment or supplement thereto (including any prospectus wrapper), as of its issue date, at the time of any filing with the Commission pursuant to Rule 424(b), at the Closing Date or at any Option Closing Date, included, includes or will include an untrue statement of a material fact or omitted, omits or will omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; *provided*, *however*, that this representation and warranty shall not apply to the Underwriters' Information.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4.2. <u>Disclosure of Agreements</u>. The agreements and documents described in the Registration Statement, the Pricing Disclosure Package and the Prospectus conform in all material respects to the descriptions thereof contained therein and there are no agreements or other documents required by the Securities Act and the Securities Act Regulations to be described in the Registration Statement, the Pricing Disclosure Package and the Prospectus or to be filed with the Commission as exhibits to the Registration Statement, that have not been so described or filed. Each agreement or other instrument (however characterized or described) to which the Company is a party or by which it is or may be bound or affected and (i) that is referred to in the Registration Statement, the Pricing Disclosure Package and the Prospectus, or (ii) is material to the Company's business, has been duly authorized and validly executed by the Company, is in full force and effect in all material respects and is enforceable against the Company and, to the Company's knowledge, the other parties thereto, in accordance with its terms, except (x) as such enforceability may be limited by bankruptcy, insolvency, reorganization or similar laws affecting creditors' rights generally, (y) as enforceability of any indemnification or contribution provision may be limited under the federal and state securities laws, and (z) that the remedy of specific performance and injunctive and other forms of equitable relief may be subject to the equitable defenses and to the discretion of the court before which any proceeding therefor may be brought. None of such agreements or instruments has been assigned by the Company, and neither the Company nor, to the Company's knowledge, any other party is in default thereunder and, to the Company's knowledge, no event has occurred that, with the lapse of time or the giving of notice, or both, would constitute a default thereunder, except for any default or event which would not reasonably be expected to result in a Material Adverse Change (as defined below). To the Company's knowledge, performance by the Company of the material provisions of such agreements or instruments will not result in a violation of any existing applicable law, rule, regulation, judgment, order or decree of any governmental agency or court, domestic or foreign, having jurisdiction over the Company or any of its assets or businesses (each, a "**Governmental Entity**"), including, without limitation, those relating to environmental laws and regulations, except for any violation which would not reasonably be expected to result in a Material Adverse Change (as defined below).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4.3. <u>Prior Securities Transactions</u>. During the past three (3) years from the date of this Agreement, no securities of the Company have been sold by the Company or by or on behalf of, or for the benefit of, any person or persons controlling, controlled by or under common control with the Company, except as disclosed in the Registration Statement, the Pricing Disclosure Package and any Preliminary Prospectus.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4.4. <u>Regulations</u>. The disclosures in the Registration Statement, the Pricing Disclosure Package and the Prospectus concerning the effects of federal, state, local and all foreign regulation on the Offering and the Company's business as currently contemplated are correct in all material respects and no other such regulations are required to be disclosed in the Registration Statement, the Pricing Disclosure Package and the Prospectus which are not so disclosed

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.5. <u>Changes after Dates in Registration Statement</u>.*

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.5.1. <u>No Material Adverse Change</u>. Since the respective dates as of which information is given in the Registration Statement, the Pricing Disclosure Package and the Prospectus, except as otherwise specifically stated therein: (i) there has been no material adverse change in the financial position or results of operations of the Company or its Subsidiaries taken as a whole, nor any change or development that, singularly or in the aggregate, would involve a material adverse change in or affecting the condition (financial or otherwise), results of operations, business, or assets of the Company or its Subsidiaries taken as a whole (a "**Material Adverse Change**"); (ii) there have been no material transactions entered into by the Company or its Subsidiaries, other than as contemplated pursuant to this Agreement; and (iii) no officer or director of the Company has resigned from any position with the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.5.2. <u>Recent Securities Transactions, etc</u>. Subsequent to the respective dates as of which information is given in the Registration Statement, the Pricing Disclosure Package and the Prospectus, and except as may otherwise be indicated or contemplated herein or disclosed in the Registration Statement, the Pricing Disclosure Package and the Prospectus, the Company has not: (i) issued any securities or incurred any liability or obligation, direct or contingent, for borrowed money; or (ii) declared or paid any dividend or made any other distribution on or in respect to its capital stock.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.6. <u>Independent Accountants</u>*. To the knowledge of the Company, dbbmckennon LLC ("**Auditor**"), whose report is filed with the Commission as part of the Registration Statement, the Pricing Disclosure Package and the Prospectus, is an independent registered public accounting firm as required by the Securities Act and the Securities Act Regulations and the Public Company Accounting Oversight Board. The Auditor has not, during the periods covered by the financial statements included in the Registration Statement, the Pricing Disclosure Package and the Prospectus, provided to the Company any non-audit services, as such term is used in Section 10A(g) of the Exchange Act.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.7. <u>Financial Statements, etc</u>.* The financial statements, including the notes thereto and supporting schedules, if any, included in the Registration Statement, the Pricing Disclosure Package and the Prospectus, fairly present in all material respects the financial position and the results of operations of the Company at the dates and for the periods to which they apply; and such financial statements have been prepared in conformity with U.S. generally accepted accounting principles ("**GAAP**"), consistently applied throughout the periods involved (provided that unaudited interim financial statements are subject to year-end audit adjustments that are not expected to be material in the aggregate and do not contain all footnotes required by GAAP); and any supporting schedules included in the Registration Statement present fairly in all material respects the information required to be stated therein. Except as included therein, no historical or pro forma financial statements are required to be included in the Registration Statement, the Pricing Disclosure Package or the Prospectus under the Securities Act or the Securities Act Regulations. The pro forma and pro forma as adjusted financial information and the related notes, if any, included in the Registration Statement, the Pricing Disclosure Package and the Prospectus have been properly compiled and prepared in accordance with the applicable requirements of the Securities Act and the Securities Act Regulations and present fairly in all material respects the information shown therein, and the assumptions used in the preparation thereof are reasonable and the adjustments used therein are appropriate to give effect to the transactions and circumstances referred to therein. All disclosures contained in the Registration Statement, the Pricing Disclosure Package or the Prospectus regarding "non-GAAP financial measures" (as such term is defined by the rules and regulations of the Commission), if any, comply with Regulation G of the Exchange Act and Item 10 of Regulation S-K of the Securities Act, to the extent applicable. Each of the Registration Statement, the Pricing Disclosure Package and the Prospectus discloses all material off-balance sheet transactions, arrangements, obligations (including contingent obligations), and other relationships of the Company with unconsolidated entities or other persons that may have a material current or future effect on the Company's financial condition, changes in financial condition, results of operations, liquidity, capital expenditures, capital resources, or significant components of revenues or expenses. Except as disclosed in the Registration Statement, the Pricing Disclosure Package and the Prospectus, (a) neither the Company nor any of its subsidiaries listed in Exhibit 21.1 to the Registration Statement (each, a "**Subsidiary**" and, collectively, the "**Subsidiaries**"), has incurred any material liabilities or obligations, direct or contingent, or entered into any material transactions other than in the ordinary course of business, (b) the Company has not declared or paid any dividends or made any distribution of any kind with respect to its Common Stock or preferred stock (c) there has not been any change in the capital of the Company or any of its Subsidiaries, or, other than in the course of business, any grants under any stock compensation plan, and (d) there has not been any Material Adverse Change in the Company's long-term or short-term debt. The Company represents that it has no direct or indirect subsidiaries other than those listed in Exhibit 21.1 to the Registration Statement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.8. <u>Authorized Capital; Options, etc</u>*. The Company had, at the date or dates indicated in the Registration Statement, the Pricing Disclosure Package and the Prospectus, the duly authorized, issued and outstanding capitalization as set forth therein. Based on the assumptions stated in the Registration Statement, the Pricing Disclosure Package and the Prospectus, the Company will have on the Closing Date the adjusted capitalization set forth therein. Except as set forth in, or contemplated by, the Registration Statement, the Pricing Disclosure Package and the Prospectus, on the Effective Date, as of the Applicable Time and on the Closing Date and any Option Closing Date, there will be no options, warrants, or other rights to purchase or otherwise acquire any authorized, but unissued Common Stock or any security convertible or exercisable into Common Stock, or any contracts or commitments to issue or sell Common Stock or any such options, warrants, rights or convertible securities.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.9. <u>Valid Issuance of Securities, etc.</u>*

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.9.1. <u>Outstanding Securities</u>. All issued and outstanding securities of the Company issued prior to the transactions contemplated by this Agreement have been duly authorized and validly issued and are fully paid and non-assessable; the holders thereof have no rights of rescission with respect thereto, and are not subject to personal liability by reason of being such holders; and none of such securities were issued in violation of the preemptive rights of any holders of any security of the Company or similar contractual rights granted by the Company. The Common Stock, preferred stock, and any other securities outstanding or to be outstanding upon consummation of the Offering conform in all material respects to all statements relating thereto contained in the Registration Statement, the Pricing Disclosure Package and the Prospectus. The offers and sales of the outstanding Common Stock were at all relevant times either registered under the Securities Act and the applicable state securities or "blue sky" laws or, based in part on the representations and warranties of the purchasers of such shares, exempt from such registration requirements.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.9.2. <u>Securities Sold Pursuant to this Agreement</u>. The Shares and Representatives' Warrants have been duly authorized for issuance and sale and, when issued and paid for, will be validly issued, fully paid and non-assessable; the holders thereof are not and will not be subject to personal liability by reason of being such holders; the Shares and Representatives' Warrants are not and will not be subject to the preemptive rights of any holders of any security of the Company or similar contractual rights granted by the Company; and all corporate action required to be taken for the authorization, issuance and sale of the Shares and Representatives' Warrants has been duly and validly taken; the Common Stock issuable upon exercise of the Representatives' Warrants have been duly authorized and reserved for issuance by all necessary corporate action on the part of the Company and when issued in accordance with such Representatives' Warrants, as the case may be, such Common Stock will be validly issued, fully paid and non-assessable. The Shares and the Representatives' Warrants conform in all material respects to all statements with respect thereto contained in the Registration Statement, the Pricing Disclosure Package and the Prospectus.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.10. <u>Registration Rights of Third Parties</u>*. Except as set forth in the Registration Statement, the Pricing Disclosure Package and the Prospectus, no holders of any securities of the Company or any rights exercisable for or convertible or exchangeable into securities of the Company have the right to require the Company to register any such securities of the Company under the Securities Act or to include any such securities in a registration statement to be filed by the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.11. <u>Validity and Binding Effect of Agreements</u>.* This Agreement and the Representatives' Warrants have been duly and validly authorized by the Company, and, when executed and delivered, will constitute, the valid and binding agreements of the Company, enforceable against the Company in accordance with their respective terms, except: (i) as such enforceability may be limited by bankruptcy, insolvency, reorganization or similar laws affecting creditors' rights generally; (ii) as enforceability of any indemnification or contribution provision may be limited under the federal and state securities laws; and (iii) that the remedy of specific performance and injunctive and other forms of equitable relief may be subject to the equitable defenses and to the discretion of the court before which any proceeding therefor may be brought.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.12. <u>No Conflicts, etc</u>.* The execution, delivery and performance by the Company of this Agreement and all ancillary documents, the consummation by the Company of the transactions herein and therein contemplated and the compliance by the Company with the terms hereof and thereof do not and will not, with or without the giving of notice or the lapse of time or both: (i) result in a material breach of, or conflict with any of the terms and provisions of, or constitute a material default under, or result in the creation, modification, termination or imposition of any lien, charge or encumbrance upon any property or assets of the Company pursuant to the terms of any agreement or instrument to which the Company is a party; (ii) result in any violation of the provisions of the Company's Certificate of Incorporation (as the same may be amended or restated from time to time, the "**Charter**") or the by-laws of the Company; or (iii) violate any existing applicable law, rule, regulation, judgment, order or decree of any Governmental Entity as of the date hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.13. <u>No Defaults; Violations</u>.* No material default exists in the due performance and observance of any term, covenant or condition of any material license, contract, indenture, mortgage, deed of trust, note, loan or credit agreement, or any other agreement or instrument evidencing an obligation for borrowed money, or any other material agreement or instrument to which the Company is a party or by which the Company may be bound or to which any of the properties or assets of the Company is subject. The Company is not (i) in violation of any term or provision of its Charter or by-laws, or (ii) in violation of any franchise, license, permit, applicable law, rule, regulation, judgment or decree of any Governmental Entity, except in the cases of clause (ii) for such violations which would not reasonably be expected to cause a Material Adverse Change.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.14. <u>Corporate Power; Licenses; Consents</u>.*

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.14.1. <u>Conduct of Business</u>. Except as described in the Registration Statement, the Pricing Disclosure Package and the Prospectus, the Company has all requisite corporate power and authority, and has all necessary authorizations, approvals, orders, licenses, certificates and permits of and from all governmental regulatory officials and bodies that it needs as of the date hereof to conduct its business purpose as described in the Registration Statement, the Pricing Disclosure Package and the Prospectus, except for the absence of which would not reasonably be expected to have a Material Adverse Change.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.14.2. <u>Transactions Contemplated Herein</u>. The Company has all corporate power and authority to enter into this Agreement and to carry out the provisions and conditions hereof, and all consents, authorizations, approvals and orders required in connection therewith have been obtained. No consent, authorization or order of, and no filing with, any court, government agency, the Exchange or other body is required for the valid issuance, sale and delivery of the Shares and the consummation of the transactions and agreements contemplated by this Agreement and the delivery of the Representatives' Warrants and as contemplated by the Registration Statement, the Pricing Disclosure Package and the Prospectus, except with respect to applicable Securities Act Regulations, state securities laws and the rules and regulations of the Financial Industry Regulatory Authority, Inc. ("**FINRA**").

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.15. <u>D&O Questionnaires</u>.* To the Company's knowledge, all information contained in the questionnaires (the "**Questionnaires**") completed by each of the Company's directors and officers immediately prior to the Offering (the "**Insiders**") as supplemented by all information concerning the Company's directors, officers and principal shareholders as described in the Registration Statement, the Pricing Disclosure Package and the Prospectus, as well as in the Lock-Up Agreement (as defined in <u>Section 2.24</u> below), provided to the Underwriters, is true and correct in all material respects and the Company has not become aware of any information which would cause the information disclosed in the Questionnaires to become materially inaccurate and incorrect.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.16. <u>Litigation; Governmental Proceedings</u>.* There is no action, suit, proceeding, inquiry, arbitration, investigation, litigation or governmental proceeding pending or, to the Company's knowledge, threatened against, or involving the Company or, to the Company's knowledge, any executive officer or director which has not been disclosed in the Registration Statement, the Pricing Disclosure Package and the Prospectus*.*

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.17. <u>Good Standing</u>.* The Company has been duly organized and is validly existing as a corporation and is in good standing under the laws of the State of Nevada as of the date hereof, and is duly qualified to do business and is in good standing in each other jurisdiction in which its ownership or lease of property or the conduct of business requires such qualification, except where the failure to qualify, singularly or in the aggregate, would not have or reasonably be expected to result in a Material Adverse Change.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.18. <u>Insurance</u>.* The Company carries or is entitled to the benefits of insurance, (including, without limitation, as to directors and officers insurance coverage), with, to the Company's knowledge, reputable insurers, in the amount of directors and officers insurance coverage at least equal to $1,000,000 and the Company has included each Underwriter as an additional insured party to the directors and officers insurance coverage and all such insurance is in full force and effect. The Company has no reason to believe that it will not be able (i) to renew its existing insurance coverage as and when such policies expire or (ii) to obtain comparable coverage from similar institutions as may be necessary or appropriate to conduct its business as now conducted and at a cost that would not result in a Material Adverse Change.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.19. <u>Transactions Affecting Disclosure to FINRA</u>.*

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.19.1. <u>Finder's Fees</u>. Except as described in the Registration Statement, the Pricing Disclosure Package and the Prospectus, there are no claims, payments, arrangements, agreements or understandings relating to the payment of a finder's, consulting or origination fee by the Company or any Insider with respect to the sale of the Shares hereunder or any other arrangements, agreements or understandings of the Company or, to the Company's knowledge, any of its shareholders that may affect the Underwriters' compensation, as determined by FINRA.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.19.2. <u>Payments within Six (6) Months</u>. Except as described in the Registration Statement, the Pricing Disclosure Package and the Prospectus, the Company has not made any direct or indirect payments (in cash, securities or otherwise) to: (i) any person, as a finder's fee, consulting fee or otherwise, in consideration of such person raising capital for the Company or introducing to the Company persons who raised or provided capital to the Company; (ii) any FINRA member; or (iii) any person or entity that has any direct or indirect affiliation or association with any FINRA member, within the six (6) months immediately prior to the original filing of the Registration Statement, other than the payment to the Underwriters as provided hereunder in connection with the Offering.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.19.3. <u>Use of Proceeds</u>. None of the net proceeds of the Offering will be paid by the Company to any participating FINRA member or its affiliates, except as specifically authorized herein.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.19.4. <u>FINRA Affiliation</u>. To the Company's knowledge, and except as may otherwise be disclosed in FINRA questionnaires provided to the Representatives' Counsel, there is no (i) officer or director of the Company, (ii) beneficial owner of 5% or more of any class of the Company's securities or (iii) beneficial owner of the Company's unregistered equity securities which were acquired during the 180-day period immediately preceding the filing of the Registration Statement that is an affiliate or associated person of a FINRA member participating in the Offering (as determined in accordance with the rules and regulations of FINRA).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.19.5. <u>Information</u>. All information provided by the Company in its FINRA questionnaire to Representatives' Counsel specifically for use by Representatives' Counsel in connection with its Public Offering System filings (and related disclosure) with FINRA is true, correct and complete in all material respects.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.20. <u>Foreign Corrupt Practices Act</u>.* None of the Company and its Subsidiaries or, to the Company's knowledge, any director, officer, agent, employee or affiliate of the Company and its Subsidiaries or any other person acting on behalf of the Company and its Subsidiaries, has, directly or indirectly, given or agreed to give any money, gift or similar benefit (other than legal price concessions to customers in the ordinary course of business) to any customer, supplier, employee or agent of a customer or supplier, or official or employee of any governmental agency or instrumentality of any government (domestic or foreign) or any political party or candidate for office (domestic or foreign) or other person who was, is, or may be in a position to help or hinder the business of the Company (or assist it in connection with any actual or proposed transaction) that (i) might subject the Company to any damage or penalty in any civil, criminal or governmental litigation or proceeding, (ii) if not given in the past, might have had a Material Adverse Change or (iii) if not continued in the future, might adversely affect the assets, business, operations or prospects of the Company. The Company has taken reasonable steps to ensure that its accounting controls and procedures are sufficient to cause the Company to comply in all material respects with the Foreign Corrupt Practices Act of 1977, as amended.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.21. <u>Compliance with OFAC</u>.* None of the Company and its Subsidiaries or, to the Company's knowledge, any director, officer, agent, employee or affiliate of the Company and its Subsidiaries or any other person acting on behalf of the Company and its Subsidiaries, is currently subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury ("**OFAC**"), and the Company will not, directly or indirectly, use the proceeds of the Offering hereunder, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other person or entity, for the purpose of financing the activities of any person currently subject to any U.S. sanctions administered by OFAC.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.22. <u>Money Laundering Laws</u>.* The operations of the Company and its Subsidiaries are and have been conducted at all times in compliance with applicable financial recordkeeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended, the money laundering statutes of all jurisdictions, the rules and regulations thereunder and any related or similar rules, regulations or guidelines, issued, administered or enforced by any Governmental Entity (collectively, the "**Money Laundering Laws**"); and no action, suit or proceeding by or before any Governmental Entity involving the Company with respect to the Money Laundering Laws is pending or, to the best knowledge of the Company, threatened.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.23. <u>Officers' Certificate</u>.* Any certificate signed by any duly authorized officer of the Company and delivered to you or to Representatives' Counsel shall be deemed a representation and warranty by the Company to the Underwriters as to the matters covered thereby.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.24. <u>Lock-Up Agreements</u>*<u>. Schedule 3</u> hereto contains a complete and accurate list of the Company's officers, directors and each owner of the Company's outstanding Common Stock (or securities convertible or exercisable into Common Stock) (collectively, the "**Lock-Up Parties**"). The Company has caused each of the Lock-Up Parties to deliver to the Representatives an executed Lock-Up Agreement, in a form substantially similar to that attached hereto as <u>Exhibit B</u> (the "**Lock-Up Agreement**"), prior to the execution of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.25. <u>Subsidiaries</u>*. All Subsidiaries of the Company are duly organized and in good standing under the laws of the place of organization or incorporation, and each Subsidiary is in good standing in each jurisdiction in which its ownership or lease of property or the conduct of business requires such qualification, except where the failure to qualify would not have a Material Adverse Change. The Company's ownership and control of each Subsidiary is as described in the Registration Statement, the Pricing Disclosure Package and the Prospectus.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.26. <u>Related Party Transactions</u>.* There are no business relationships or related party transactions involving the Company or any other person required to be described in the Registration Statement, the Pricing Disclosure Package and the Prospectus that have not been described as required by the Securities Act Regulations.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.27. <u>Board of Directors</u>.* The Board of Directors of the Company is comprised of the persons set forth under the heading of the Pricing Prospectus and the Prospectus captioned "Management." The qualifications of the persons serving as board members and the overall composition of the board comply with the Exchange Act, the Exchange Act Regulations, the Sarbanes-Oxley Act of 2002 and the rules promulgated thereunder (the "**Sarbanes-Oxley Act**") applicable to the Company and the listing rules of the Exchange. At least one member of the Audit Committee of the Board of Directors of the Company qualifies as an "audit committee financial expert," as such term is defined under Regulation S-K and the listing rules of the Exchange. In addition, at least a majority of the persons serving on the Board of Directors qualify as "independent," as defined under the listing rules of the Exchange.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.28. <u>Sarbanes-Oxley Compliance</u>.*

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.28.1. <u>Disclosure Controls</u>. Except as disclosed in the Registration Statement, Pricing Disclosure Package and the Prospectus, the Company has developed and currently maintains disclosure controls and procedures that will comply with Rule 13a-15 or 15d-15 under the Exchange Act Regulations, and such controls and procedures are effective to ensure that all material information concerning the Company will be made known on a timely basis to the individuals responsible for the preparation of the Company's Exchange Act filings and other public disclosure documents.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.28.2. <u>Compliance</u>. The Company is, or at the Applicable Time and on the Closing Date will be, in material compliance with the provisions of the Sarbanes-Oxley Act applicable to it, and has implemented or will implement such programs and has taken reasonable steps to ensure the Company's future compliance (not later than the relevant statutory and regulatory deadlines therefor) with all of the material provisions of the Sarbanes-Oxley Act.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.29.* <u>Accounting Controls</u>. Except as disclosed in the Registration Statement, Pricing Disclosure Package and the Prospectus, the Company maintains systems of "internal control over financial reporting" (as defined under Rules 13a-15 and 15d-15 under the Exchange Act Regulations) that comply in all material respects with the requirements of the Exchange Act and have been designed by, or under the supervision of, its respective principal executive and principal financial officers, or persons performing similar functions, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP, including, but not limited to, internal accounting controls sufficient to provide reasonable assurance that (i) transactions are executed in accordance with management's general or specific authorizations; (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with GAAP and to maintain asset accountability; (iii) access to assets is permitted only in accordance with management's general or specific authorization; and (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences. Except as disclosed in the Registration Statement, the Pricing Disclosure Package and the Prospectus, the Company is not aware of any material weaknesses in its internal control over financial reporting, and, if applicable, with respect to such remedial actions disclosed in the Registration Statement, the Pricing Disclosure Package and the Prospectus, the Company represents that it has taken all remedial actions set forth in such disclosure. The Company's Auditor and the Audit Committee of the Board of Directors of the Company have been advised of: (i) all significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are known to the Company's management and that have adversely affected or are reasonably likely to adversely affect the Company' ability to record, process, summarize and report financial information; and (ii) any fraud known to the Company's management, whether or not material, that involves management or other employees who have a significant role in the Company's internal controls over financial reporting.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.30. <u>No Investment Company Status</u>*. The Company is not and, after giving effect to the Offering and the application of the proceeds thereof as described in the Registration Statement, the Pricing Disclosure Package and the Prospectus, will not be, required to register as an "investment company," as defined in the Investment Company Act of 1940, as amended.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.31. <u>No Labor Disputes</u>.* No labor dispute with the employees of the Company or any of its Subsidiaries exists or, to the knowledge of the Company, is imminent.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.32. <u>Intellectual Property Rights</u>*. The Company and each of its Subsidiaries owns or possesses or has valid rights to use all patents, patent applications, trademarks, service marks, trade names, trademark registrations, service mark registrations, copyrights, licenses, inventions, trade secrets and similar rights ("**Intellectual Property Rights**") necessary for the conduct of the business of the Company and its Subsidiaries as currently carried on and as described in the Registration Statement, the Pricing Disclosure Package and the Prospectus. To the knowledge of the Company, no action or use by the Company or any of its Subsidiaries necessary for the conduct of its business as currently carried on and as described in the Registration Statement and the Prospectus will involve or give rise to any infringement of, or license or similar fees for, any Intellectual Property Rights of others. Neither the Company nor any of its Subsidiaries has received any written notice alleging any such infringement, fee or conflict with asserted Intellectual Property Rights of others. Except as would not reasonably be expected to result, individually or in the aggregate, in a Material Adverse Change (A) to the knowledge of the Company, there is no infringement, misappropriation or violation by third parties of any of the Intellectual Property Rights owned by the Company; (B) there is no pending or, to the knowledge of the Company, threatened action, suit, proceeding or claim by others challenging the rights of the Company in or to any such Intellectual Property Rights, and the Company is unaware of any facts which would form a reasonable basis for any such claim, that would, individually or in the aggregate, together with any other claims in this <u>Section 2.32</u>, reasonably be expected to result in a Material Adverse Change; (C) the Intellectual Property Rights owned by the Company and, to the knowledge of the Company, the Intellectual Property Rights licensed to the Company have not been adjudged by a court of competent jurisdiction invalid or unenforceable, in whole or in part, and there is no pending or, to the Company's knowledge, threatened action, suit, proceeding or claim by others challenging the validity or scope of any such Intellectual Property Rights, and the Company is unaware of any facts which would form a reasonable basis for any such claim that would, individually or in the aggregate, together with any other claims in this <u>Section 2.32</u>, reasonably be expected to result in a Material Adverse Change; (D) there is no pending or, to the Company's knowledge, threatened action, suit, proceeding or claim by others that the Company infringes, misappropriates or otherwise violates any Intellectual Property Rights or other proprietary rights of others, the Company has not received any written notice of such claim and the Company is unaware of any other facts which would form a reasonable basis for any such claim that would, individually or in the aggregate, together with any other claims in this <u>Section 2.32</u>, reasonably be expected to result in a Material Adverse Change; and (E) to the Company's knowledge, no employee of the Company is in or has ever been in violation in any material respect of any term of any employment contract, patent disclosure agreement, invention assignment agreement, non-competition agreement, non-solicitation agreement, nondisclosure agreement or any restrictive covenant to or with a former employer where the basis of such violation relates to such employee's employment with the Company, or actions undertaken by the employee while employed with the Company and could reasonably be expected to result, individually or in the aggregate, in a Material Adverse Change. To the Company's knowledge, all material technical information developed by and belonging to the Company which has not been patented has been kept confidential. The Company is not a party to or bound by any options, licenses or agreements with respect to the Intellectual Property Rights of any other person or entity that are required to be set forth in the Registration Statement, the Pricing Disclosure Package and the Prospectus and are not described therein. The Registration Statement, the Pricing Disclosure Package and the Prospectus contain in all material respects the same description of the matters set forth in the preceding sentence. None of the technology employed by the Company has been obtained or is being used by the Company in violation of any contractual obligation binding on the Company or, to the Company's knowledge, any of its officers, directors or employees, or otherwise in violation of the rights of any persons.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.33. <u>Taxes</u>*. Each of the Company and its Subsidiaries has filed all returns (as hereinafter defined) required to be filed with taxing authorities prior to the date hereof or has duly obtained extensions of time for the filing thereof, except in any case in which the failure so to file would not reasonably be expected to cause a Material Adverse Change. Each of the Company and its Subsidiaries has paid all taxes (as hereinafter defined) shown as due on such returns that were filed and has paid all taxes imposed on or assessed against the Company or such respective Subsidiary, except for any such taxes that are currently being contested in good faith or as would not reasonably be expected to cause a Material Adverse Change. The provisions for taxes payable, if any, shown on the financial statements filed with or as part of the Registration Statement are sufficient for all accrued and unpaid taxes, whether or not disputed, and for all periods to and including the dates of such consolidated financial statements. Except as disclosed in writing to the Underwriters, (i) no issues have been raised (and are currently pending) by any taxing authority in connection with any of the returns or taxes asserted as due from the Company or its Subsidiaries, and (ii) no waivers of statutes of limitation with respect to the returns or collection of taxes have been given by or requested from the Company or its Subsidiaries. The term "taxes" means all federal, state, local, foreign and other net income, gross income, gross receipts, sales, use, ad valorem, transfer, franchise, profits, license, lease, service, service use, withholding, payroll, employment, excise, severance, stamp, occupation, premium, property, windfall profits, customs, duties or other taxes, fees, assessments or charges of any kind whatever, together with any interest and any penalties, additions to tax or additional amounts with respect thereto. The term "returns" means all returns, declarations, reports, statements and other documents required to be filed in respect to taxes.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.34. <u>ERISA Compliance</u>.* The Company is not subject to the Employee Retirement Income Security Act of 1974, as amended, or the regulations and published interpretations thereunder.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.35. <u>Compliance with Laws</u>*. Except as otherwise disclosed in the Registration Statement, Pricing Disclosure Package and Prospectus and as could not, individually or in the aggregate, be expected to result in a Material Adverse Change, each of the Company and each Subsidiary, the Company: (A) is and at all times has been in compliance with all statutes, rules, or regulations applicable to the services provided by the Company ("**Applicable Laws**"), except as could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Change; (B) has not received any warning letter, untitled letter or other correspondence or notice from any other governmental authority alleging or asserting noncompliance with any Applicable Laws or any licenses, certificates, approvals, clearances, authorizations, permits and supplements or amendments thereto required by any such Applicable Laws ("**Authorizations**"); (C) possesses all material Authorizations and such material Authorizations are valid and in full force and effect and are not in material violation of any term of any such Authorizations; (D) has not received written notice of any claim, action, suit, proceeding, hearing, enforcement, investigation, arbitration or other action from any governmental authority or third party alleging that any product operation or activity is in violation of any Applicable Laws or Authorizations and has no knowledge that any such governmental authority or third party is considering any such claim, litigation, arbitration, action, suit, investigation or proceeding that if brought would result in a Material Adverse Change; (E) has not received written notice that any Governmental Authority has taken, is taking or intends to take action to limit, suspend, modify or revoke any Authorizations and has no knowledge that any such Governmental Authority is considering such action; (F) has filed, obtained, maintained or submitted all material reports, documents, forms, notices, applications, records, claims, submissions and supplements or amendments as required by any Applicable Laws or Authorizations and that all such reports, documents, forms, notices, applications, records, claims, submissions and supplements or amendments were complete and correct in all material respects on the date filed (or were corrected or supplemented by a subsequent submission); and (G) has not, either voluntarily or involuntarily, initiated, conducted, or issued or caused to be initiated, conducted or issued, any recall, market withdrawal or replacement, safety alert, post-sale warning, or other notice or action relating to the alleged lack of safety of any product or any alleged product defect or violation and, to the Company's knowledge, no third party has initiated, conducted or intends to initiate any such notice or action.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.36. <u>Ineligible Issuer</u>.* At the time of filing the Registration Statement and any post-effective amendment thereto, at the time of effectiveness of the Registration Statement and any amendment thereto, at the earliest time thereafter that the Company or another offering participant made a bona fide offer (within the meaning of Rule 164(h)(2) of the Securities Act Regulations) of the Shares and at the date hereof, the Company was not and is not an "ineligible issuer," as defined in Rule 405, without taking account of any determination by the Commission pursuant to Rule 405 that it is not necessary that the Company be considered an ineligible issuer.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.37. <u>Real Property</u>.* Except as set forth in the Registration Statement, the Pricing Disclosure Package and the Prospectus, the Company and its Subsidiaries have good and marketable title in fee simple to, or have valid rights to lease or otherwise use, all items of real or personal property which are material to the business of the Company and its Subsidiaries taken as a whole, in each case free and clear of all liens, encumbrances, security interests, claims and defects that do not, singly or in the aggregate, materially affect the value of such property and do not interfere with the use made and proposed to be made of such property by the Company or its Subsidiaries; and all of the leases and subleases material to the business of the Company and its Subsidiaries, considered as one enterprise, and under which the Company or any of its Subsidiaries holds properties described in the Registration Statement, the Pricing Disclosure Package and the Prospectus, are in full force and effect, and neither the Company nor any Subsidiary has received any written notice of any material claim of any sort that has been asserted by anyone adverse to the rights of the Company or any Subsidiary under any of the leases or subleases mentioned above, or affecting or questioning the rights of the Company or such Subsidiary to the continued possession of the leased or subleased premises under any such lease or sublease, which would result in a Material Adverse Change.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.38. <u>Contracts Affecting Capital</u>*. There are no transactions, arrangements or other relationships between and/or among the Company, any of its affiliates (as such term is defined in Rule 405 of the Securities Act Regulations) and any unconsolidated entity, including, but not limited to, any structured finance, special purpose or limited purpose entity that could reasonably be expected to materially affect the Company's or its Subsidiaries' liquidity or the availability of or requirements for their capital resources required to be described or incorporated by reference in the Registration Statement, the Pricing Disclosure Package and the Prospectus which have not been described or incorporated by reference as required.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.39. <u>Loans to Directors or Officers</u>.* There are no outstanding loans, advances (except normal advances for business expenses in the ordinary course of business) or guarantees or indebtedness by the Company or its Subsidiaries to or for the benefit of any of the officers or directors of the Company, its Subsidiaries or any of their respective family members, except as disclosed in the Registration Statement, the Pricing Disclosure Package and the Prospectus.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.40. <u>Industry Data; Forward-looking statements</u>.* The statistical and market-related data included in each of the Registration Statement, the Pricing Disclosure Package and the Prospectus are based on or derived from sources that the Company reasonably and in good faith believes are reliable and accurate or represent the Company's good faith estimates that are made on the basis of data derived from such sources. No forward-looking statement (within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act) contained in the Prospectus has been made or reaffirmed without a reasonable basis or has been disclosed other than in good faith.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.41. <u>Intentionally omitted.</u>*

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.42. <u>Intentionally omitted.</u>*

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.43. <u>Electronic Road Show</u>.* The Company has made available a Bona Fide Electronic Road Show in compliance with Rule 433(d)(8)(ii) of the Securities Act Regulations such that no filing of any "road show" (as defined in Rule 433(h) of the Securities Act Regulations) is required in connection with the Offering.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.44. <u>Margin Securities</u>.* The Company owns no "margin securities" as that term is defined in Regulation U of the Board of Governors of the Federal Reserve System (the "**Federal Reserve Board**"), and none of the proceeds of Offering will be used, directly or indirectly, for the purpose of purchasing or carrying any margin security, for the purpose of reducing or retiring any indebtedness which was originally incurred to purchase or carry any margin security or for any other purpose which might cause any of the Common Stock to be considered a "purpose credit" within the meanings of Regulation T, U or X of the Federal Reserve Board*.*

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.45. <u>Dividends and Distributions</u>*. Except as disclosed in the Pricing Disclosure Package, Registration Statement and the Prospectus, no Subsidiary of the Company is currently prohibited or restricted, directly or indirectly, from paying any dividends to the Company, from making any other distribution on such Subsidiary's capital stock, from repaying to the Company any loans or advances to such Subsidiary from the Company or from transferring any of such Subsidiary's property or assets to the Company or any other Subsidiary of the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*2.46. <u>Lending Relationships</u>*. Except as disclosed in the Pricing Disclosure Package, Registration Statement and the Prospectus, the Company (i) does not have any material lending or other relationship with any bank or lending affiliate of the Underwriters and (ii) does not intend to use any of the proceeds from the sale of the Securities hereunder to repay any outstanding debt owed to any affiliate of the Underwriters.

3. <u>Covenants of the Company</u>. The Company covenants and agrees as follows:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*3.1. <u>Amendments to Registration Statement</u>.* The Company shall deliver to the Representatives, prior to filing, any amendment or supplement to the Registration Statement or Prospectus proposed to be filed after the Effective Date and not file any such amendment or supplement to which the Representatives shall reasonably object in writing.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*3.2. <u>Federal Securities Laws</u>.*

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2.1. <u>Compliance</u>. The Company, subject to <u>Section 3.2.2</u>, shall comply with the requirements of Rule 430A of the Securities Act Regulations, and will notify the Representatives promptly, and confirm the notice in writing, (i) when any post-effective amendment to the Registration Statement shall become effective or any amendment or supplement to the Prospectus shall have been filed; (ii) of the receipt of any comments from the Commission; (iii) of any request by the Commission for any amendment to the Registration Statement or any amendment or supplement to the Prospectus or for additional information; (iv) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or any post-effective amendment or of any order preventing or suspending the use of any Preliminary Prospectus or the Prospectus, or of the suspension of the qualification of the Shares and the Representatives' Warrants for offering or sale in any jurisdiction, or of the initiation or threatening of any proceedings for any of such purposes or of any examination pursuant to Section 8(d) or 8(e) of the Securities Act concerning the Registration Statement and (v) if the Company becomes the subject of a proceeding under Section 8A of the Securities Act in connection with the Offering of the Shares and Representatives' Warrants. The Company shall effect all filings required under Rule 424(b) of the Securities Act Regulations, in the manner and within the time period required by Rule 424(b) (without reliance on Rule 424(b)(8)), and shall take such steps as it deems necessary to ascertain promptly whether the form of prospectus transmitted for filing under Rule 424(b) was received for filing by the Commission and, in the event that it was not, it will promptly file such prospectus. The Company shall use its reasonable best efforts to prevent the issuance of any stop order, prevention or suspension and, if any such order is issued, to obtain the lifting thereof at the earliest possible moment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2.2. <u>Continued Compliance</u>. The Company shall comply with the Securities Act, the Securities Act Regulations, the Exchange Act and the Exchange Act Regulations so as to permit the completion of the distribution of the Shares as contemplated in this Agreement and in the Registration Statement, the Pricing Disclosure Package and the Prospectus. If at any time when a prospectus relating to the Shares is (or, but for the exception afforded by Rule 172 of the Securities Act Regulations ("**Rule 172**"), would be) required by the Securities Act to be delivered in connection with sales of the Shares, any event shall occur or condition shall exist as a result of which it is necessary, in the opinion of counsel for the Underwriters or for the Company, to (i) amend the Registration Statement in order that the Registration Statement will not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading; (ii) amend or supplement the Pricing Disclosure Package or the Prospectus in order that the Pricing Disclosure Package or the Prospectus, as the case may be, will not include any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein not misleading in the light of the circumstances existing at the time it is delivered to a purchaser or (iii) amend the Registration Statement or amend or supplement the Pricing Disclosure Package or the Prospectus, as the case may be, in order to comply with the requirements of the Securities Act or the Securities Act Regulations, the Company will promptly (A) give the Representatives notice of such event; (B) prepare any amendment or supplement as may be necessary to correct such statement or omission or to make the Registration Statement, the Pricing Disclosure Package or the Prospectus comply with such requirements and, a reasonable amount of time prior to any proposed filing or use, furnish the Representatives with copies of any such amendment or supplement and (C) file with the Commission any such amendment or supplement; *provided* that the Company shall not file or use any such amendment or supplement to which the Representatives or Representatives' Counsel shall reasonably object. The Company will furnish to the Underwriters such number of copies of such amendment or supplement as the Underwriters may reasonably request. The Company has given the Representatives notice of any filings made pursuant to the Exchange Act or the Exchange Act Regulations within 48 hours prior to the Applicable Time. The Company shall give the Representatives notice of its intention to make any such filing from the Applicable Time until the later of the Closing Date and the exercise in full or expiration of the Over-allotment Option specified in <u>Section 1.2</u> hereof and will furnish the Representatives with copies of the related document(s) a reasonable amount of time prior to such proposed filing, as the case may be, and will not file or use any such document to which the Representatives or counsel for the Underwriters shall reasonably object.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2.3. <u>Exchange Act Registration</u>. Until three (3) years after the date of this Agreement, the Company shall use its commercially reasonable efforts to maintain the registration of the Common Stock under the Exchange Act.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2.4. <u>Free Writing Prospectuses</u>. The Company agrees that, unless it obtains the prior consent of the Representatives, it shall not make any offer relating to the Shares that would constitute an Issuer Free Writing Prospectus or that would otherwise constitute a "free writing prospectus," or a portion thereof, required to be filed by the Company with the Commission or retained by the Company under Rule 433; *provided* that the Representatives shall be deemed to have consented to each Issuer General Use Free Writing Prospectus set forth in <u>Schedule 2-B</u>. The Company represents that it has treated or agrees that it will treat each such free writing prospectus consented to, or deemed consented to, by the Underwriters as an "issuer free writing prospectus," as defined in Rule 433, and that it has complied and will comply with the applicable requirements of Rule 433 with respect thereto, including timely filing with the Commission where required, legending and record keeping. If at any time following issuance of an Issuer Free Writing Prospectus there occurred or occurs an event or development as a result of which such Issuer Free Writing Prospectus conflicted or would conflict with the information contained in the Registration Statement or included or would include an untrue statement of a material fact or omitted or would omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances existing at that subsequent time, not misleading, the Company will promptly notify the Underwriters and will promptly amend or supplement, at its own expense, such Issuer Free Writing Prospectus to eliminate or correct such conflict, untrue statement or omission.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2.5. <u>Testing-the-Waters Communications</u>. If at any time following the distribution of any Written Testing-the-Waters Communication there occurred or occurs an event or development as a result of which such Written Testing-the-Waters Communication included or would include an untrue statement of a material fact or omitted or would omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances existing at that subsequent time, not misleading, the Company shall promptly notify the Representatives and shall promptly amend or supplement, at its own expense, such Written Testing-the-Waters Communication to eliminate or correct such untrue statement or omission.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*3.3. <u>Delivery to the Underwriters of Registration Statements</u>*. The Company has delivered or made available or shall deliver or make available to the Representatives and Representatives' Counsel, without charge, signed copies of the Registration Statement as originally filed and each amendment thereto (including exhibits filed therewith) and signed copies of all consents and certificates of experts, and upon request will also deliver to the Underwriters, without charge, a conformed copy of the Registration Statement as originally filed and each amendment thereto (without exhibits) for each of the Underwriters. The copies of the Registration Statement and each amendment thereto furnished to the Underwriters will be identical to the electronically transmitted copies thereof filed with the Commission pursuant to EDGAR, except to the extent permitted by Regulation S-T.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*3.4. <u>Delivery to the Underwriters of Prospectuses</u>.* The Company has delivered or made available or will deliver or make available to each Underwriter, without charge, as many copies of each Preliminary Prospectus as such Underwriter reasonably requested, and the Company hereby consents to the use of such copies for purposes permitted by the Securities Act. The Company will furnish to each Underwriter, without charge, during the period when a prospectus relating to the Shares is (or, but for the exception afforded by Rule 172, would be) required to be delivered under the Securities Act, such number of copies of the Prospectus (as amended or supplemented) as such Underwriter may reasonably request. The Prospectus and any amendments or supplements thereto furnished to the Underwriters will be identical to the electronically transmitted copies thereof filed with the Commission pursuant to EDGAR, except to the extent permitted by Regulation S-T.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*3.5. <u>Effectiveness and Events Requiring Notice to the Representatives</u>.* The Company shall use its commercially reasonable efforts to cause the Registration Statement covering the issuance of the shares of Common Stock underlying the Representatives' Warrants to remain effective with a current prospectus for at least nine (9) months after the Applicable Time, and shall notify the Representatives immediately and confirm the notice in writing: (i) of the cessation of the effectiveness of the Registration Statement and any amendment thereto; (ii) of the issuance by the Commission of any stop order or of the initiation, or the threatening, of any proceeding for that purpose; (iii) of the issuance by any state securities commission of any proceedings for the suspension of the qualification of the shares underlying the Representatives' Warrants for offering or sale in any jurisdiction or of the initiation, or the threatening, of any proceeding for that purpose; (iv) of the mailing and delivery to the Commission for filing of any amendment or supplement to the Registration Statement or Prospectus; (v) of the receipt of any comments or request for any additional information from the Commission; and (vi) of the happening of any event during the period described in this <u>Section 3.5</u> that, in the judgment of the Company, makes any statement of a material fact made in the Registration Statement, the Pricing Disclosure Package or the Prospectus untrue or that requires the making of any changes in (a) the Registration Statement in order to make the statements therein not misleading, or (b) in the Pricing Disclosure Package or the Prospectus in order to make the statements therein, in light of the circumstances under which they were made, not misleading. If the Commission or any state securities commission shall enter a stop order or suspend such qualification at any time, the Company shall make every reasonable effort to obtain promptly the lifting of such order.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*3.6. <u>Review of Financial Statements.</u>* For a period of three (3) years after the date of this Agreement, the Company, at its expense, shall cause its regularly engaged independent registered public accounting firm to review (but not audit) the Company's financial statements for each of the three fiscal quarters immediately preceding the announcement of any quarterly financial information.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*3.7. <u>Listing</u>.* The Company shall use its commercially reasonable efforts to maintain the listing of the Shares and the shares of Common Stock underlying the Representatives' Warrant on the Exchange for at least three (3) years from the date of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*3.8. <u>Intentionally omitted</u>*.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*3.9. <u>Reports to the Representatives</u>.*

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.9.1. <u>Periodic Reports, etc</u>. For a period of three (3) years after the date of this Agreement, the Company shall furnish or make available to the Representatives copies of such financial statements and other periodic and special reports as the Company from time to time furnishes generally to holders of any class of its securities and also furnish or make available to the Representatives: (i) a copy of each periodic report the Company shall be required to file with the Commission under the Exchange Act and the Exchange Act Regulations; (ii) a copy of every press release and every news item and article with respect to the Company or its affairs which was released by the Company; (iii) a copy of each Form 8-K prepared and filed by the Company; (iv) a copy of each registration statement filed by the Company under the Securities Act; and (v) such additional documents and information with respect to the Company and the affairs of any future subsidiaries of the Company as the Representatives may from time to time reasonably request; *provided* the Representatives shall sign, if requested by the Company, a Regulation FD compliant confidentiality agreement which is reasonably acceptable to the Representatives and Representatives' Counsel in connection with the Representatives' receipt of such information. Documents filed with the Commission pursuant to its EDGAR system shall be deemed to have been delivered to the Representatives pursuant to this <u>Section 3.9.1</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.9.2. <u>Transfer Agent; Transfer Sheets</u>. For a period of three (3) years after the date of this Agreement, the Company shall retain a transfer agent and registrar acceptable to the Representatives (the "**Transfer Agent**") and shall furnish to the Representatives at the Company's sole cost and expense such transfer sheets of the Company's securities as the Representatives may reasonably request, including the daily and monthly consolidated transfer sheets of the Transfer Agent and DTC. Transfer Online, Inc. is acceptable to the Representatives to act as Transfer Agent for the Common Stock.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.9.3. <u>Trading Reports</u>. For a period of six (6) months after the date hereof, during such time as the Shares are listed on the Exchange, the Company shall provide to the Representatives, at the Company's expense, such reports published by the Exchange relating to price trading of the Shares, as the Representatives shall reasonably request.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*3.10. <u>Payment of Expenses</u>*

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.10.1. <u>General Expenses Related to the Offering</u>. The Company hereby agrees to pay on each of the Closing Date and the Option Closing Date, if any, to the extent not paid at the Closing Date, all expenses incident to the performance of the obligations of the Company under this Agreement, including, but not limited to: (a) all filing fees and communication expenses relating to the registration of the Shares to be sold in the Offering (including the Option Shares) with the Commission; (b) all Public Filing System filing fees associated with the review of the Offering by FINRA; (c) all fees, expenses and disbursements relating to the registration, qualification or exemption of the Shares under the securities laws of such foreign jurisdictions as the Representatives may reasonably designate; (d) the costs associated with receiving commemorative mementos and lucite tombstones; (e) fees and expenses of the Representatives' Counsel; and (f) the Underwriters' "road show" expenses for the Offering, with all of the Underwriters' actual out-of-pocket expenses under sub-sections 3.10.1(d)-(f) not to exceed $55,000. Any such out-of-pocket expenses described in the preceding sentence above $5,000 shall have been pre-approved by the Company. The Representatives may deduct from the net proceeds of the Offering payable to the Company on the Closing Date, or the Option Closing Date, if any, the expenses set forth herein to be paid by the Company to the Underwriters; *provided*, *however*, that in the event that the Offering is terminated, the Company agrees to reimburse the Underwriters pursuant to <u>Section 7.3</u> hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.10.2. <u>Non-accountable Expenses</u>. The Company further agrees that, in addition to the expenses payable pursuant to <u>Section 3.10.1</u>, on the Closing Date it shall pay to the Representatives, by deduction from the net proceeds of the Offering contemplated herein, a non-accountable expense allowance equal to one percent (1.0%) of the gross proceeds received by the Company from the sale of the Firm Shares.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*3.11. <u>Application of Net Proceeds</u>.* The Company shall apply the net proceeds from the Offering received by it in a manner consistent with the application thereof described under the caption "Use of Proceeds" in the Registration Statement, the Pricing Disclosure Package and the Prospectus.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*3.12. <u>Delivery of Earnings Statements to Security Holders</u>*. The Company shall make generally available to its security holders as soon as practicable, but not later than the first day of the fifteenth (15<sup>th</sup>) full calendar month following the date of this Agreement, an earnings statement (which need not be certified by independent registered public accounting firm unless required by the Securities Act or the Securities Act Regulations, but which shall satisfy the provisions of Rule 158(a) under Section 11(a) of the Securities Act) covering a period of at least twelve (12) consecutive months beginning after the date of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*3.13. <u>Stabilization</u>.* Neither the Company nor, to its knowledge, any of its employees, directors or shareholders has taken or shall take, directly or indirectly, any action designed to or that has constituted or that might reasonably be expected to cause or result in, under Regulation M of the Exchange Act, or otherwise, stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of the Shares.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*3.14. <u>Internal Controls</u>*. Except to the extent disclosed in the Registration Statement, Pricing Disclosure Package and Prospectus, the Company shall maintain a system of internal accounting controls sufficient to provide reasonable assurances that: (i) transactions are executed in accordance with management's general or specific authorization; (ii) transactions are recorded as necessary in order to permit preparation of financial statements in accordance with GAAP and to maintain accountability for assets; (iii) access to assets is permitted only in accordance with management's general or specific authorization; and (iv) the recorded accountability for assets is compared with existing assets at reasonable intervals and appropriate action is taken with respect to any differences.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*3.15. <u>Accountants</u>*. As of the date of this Agreement, the Company has retained an independent registered public accounting firm reasonably acceptable to the Representatives, and the Company shall continue to retain a nationally recognized independent registered public accounting firm for a period of at least three (3) years after the date of this Agreement. The Representatives acknowledges that the Auditor is acceptable to the Representatives.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*3.16. <u>FINRA</u>*. For a period of ninety (90) days from the later of the Closing Date or the Option Closing Date, the Company shall advise the Representatives (who shall make an appropriate filing with FINRA) if it is or becomes aware that (i) any officer or director of the Company, (ii) any beneficial owner of 5% or more of any class of the Company's securities or (iii) any beneficial owner of the Company's unregistered equity securities which were acquired during the 180 days immediately preceding the filing of the original Registration Statement is or becomes an affiliate or associated person of a FINRA member participating in the Offering (as determined in accordance with the rules and regulations of FINRA).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*3.17. <u>No Fiduciary Duties</u>*. The Company acknowledges and agrees that the Underwriters' responsibility to the Company is solely contractual in nature and that none of the Underwriters or their affiliates or any selling agent shall be deemed to be acting in a fiduciary capacity, or otherwise owes any fiduciary duty to the Company or any of its affiliates in connection with the Offering and the other transactions contemplated by this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*3.18<u>.</u><u>Company Lock-Up</u>*<u>.</u> The Company, on behalf of itself and any successor entity, agrees that, without the prior written consent of the Representatives, it will not, for a period beginning on the date of this Agreement and continuing until September 1, 2023 (the "<u>Lock-Up Period</u>"), (i) offer, pledge, announce the intention to sell, sell, contract to sell, sell any option or contract to purchase, purchase any option or contract to sell, grant or modify the terms of any option, right or warrant to purchase, lend, or otherwise transfer or dispose of, directly or indirectly, any shares of capital stock of the Company or any securities convertible into or exercisable or exchangeable for shares of capital stock of the Company or modify the terms of any existing securities, in each case, whether in conjunction with another broker-dealer or on the Company's own volition; (ii) file or cause to be filed any registration statement with the Commission relating to the offering of any shares of capital stock of the Company or any securities convertible into or exercisable or exchangeable for shares of capital stock of the Company (other than pursuant to a registration statement on Form S-8 for employee benefit plans); or (iii) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of capital stock of the Company, whether any such transaction described in clause (i), (ii) or (iii) above is to be settled by delivery of shares of capital stock of the Company or such other securities, in cash or otherwise. The restrictions contained in this section shall not apply to (i) the Shares and the Representatives' Warrants and shares underlying the Representatives' Warrants to be sold hereunder; and (ii) the issuance by the Company of Common Stock upon the exercise of an outstanding option or warrant or the conversion of a security outstanding on the date hereof or disclosed in the Registration Statement and the Pricing Disclosure Package.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*3.19. <u>Release of D&O Lock-up Period</u>*. If the Representatives, in their sole discretion, agrees to release or waive the restrictions set forth in the Lock-Up Agreements described in <u>Section 2.24</u> hereof for an officer or director of the Company and provides the Company with notice of the impending release or waiver at least three (3) Business Days before the effective date of the release or waiver, the Company agrees to announce the impending release or waiver by a press release substantially in the form of <u>Exhibit C</u> hereto through a major news service at least two (2) Business Days before the effective date of the release or waiver.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*3.20. <u>Blue Sky Qualifications</u>.* The Company shall use its best efforts, in cooperation with the Underwriters, if necessary, to qualify the Shares for offering and sale under the applicable securities laws of such states and other jurisdictions (domestic or foreign) as the Representatives may designate and to maintain such qualifications in effect so long as required to complete the distribution of the Shares; *provided*, *however*, that the Company shall not be obligated to file any general consent to service of process or to qualify as a foreign corporation or as a dealer in securities in any jurisdiction in which it is not so qualified or to subject itself to taxation in respect of doing business in any jurisdiction in which it is not otherwise so subject.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*3.21. <u>Reporting Requirements</u>.* The Company, during the period when a prospectus relating to the Shares is (or, but for the exception afforded by Rule 172, would be) required to be delivered under the Securities Act, will file all documents required to be filed with the Commission pursuant to the Exchange Act within the time periods required by the Exchange Act and Exchange Act Regulations. Additionally, the Company shall report the use of proceeds from the issuance of the Shares as may be required under Rule 463 under the Securities Act Regulations.

4. <u>Conditions of Underwriters' Obligations</u>. The obligations of the Underwriters to purchase and pay for the Shares, as provided herein, shall be subject to (i) the continuing accuracy of the representations and warranties of the Company as of the date hereof and as of each of the Closing Date and the Option Closing Date, if any; (ii) the accuracy of the statements of officers of the Company made pursuant to the provisions hereof; (iii) the performance by the Company of its obligations hereunder; and (iv) the following conditions:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*4.1. <u>Regulatory Matters</u>.*

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1.1. <u>Effectiveness of Registration Statement; Rule 430A Information</u>. The Registration Statement has become effective not later than 5:00 p.m., Eastern time, on the date of this Agreement or such later date and time as shall be consented to in writing by you, and, at each of the Closing Date and any Option Closing Date, no stop order suspending the effectiveness of the Registration Statement or any post-effective amendment thereto has been issued under the Securities Act, no order preventing or suspending the use of any Preliminary Prospectus or the Prospectus has been issued and no proceedings for any of those purposes have been instituted or are pending or, to the Company's knowledge, contemplated by the Commission. The Company has complied with each request (if any) from the Commission for additional information. The Prospectus containing the Rule 430A Information shall have been filed with the Commission in the manner and within the time frame required by Rule 424(b) (without reliance on Rule 424(b)(8)) or a post-effective amendment providing such information shall have been filed with, and declared effective by, the Commission in accordance with the requirements of Rule 430A.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1.2. <u>FINRA Clearance</u>. On or before the date of this Agreement, the Representatives shall have received clearance from FINRA as to the amount of compensation allowable or payable to the Underwriters as described in the Registration Statement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1.3. <u>Exchange Share Market Clearance</u>. On the Closing Date, the Firm Shares shall have been approved for listing on the Exchange, subject only to official notice of issuance. On the first Option Closing Date (if any), the Option Shares shall have been approved for listing on the Exchange, subject only to official notice of issuance.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*4.2. <u>Company Counsel Matters</u>.*

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2.1. <u>Closing Date Opinion of Counsel for the Company</u>. On the Closing Date, the Representatives shall have received the favorable opinion and negative assurances statement of Brunson Chandler & Jones, PLLC, counsel for the Company, dated the Closing Date, in customary form and substance reasonably satisfactory to Representatives' Counsel addressed to the Representatives and stating that such opinions may be relied upon by Representatives' Counsel.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2.3. <u>Option Closing Date Opinion of Counsel for the Company</u>. On the Option Closing Date, if any, the Representatives shall have received the favorable opinion and negative assurances statement of Brunson Chandler & Jones, PLLC, counsel for the Company, dated the Option Closing Date, addressed to the Representatives and in customary form and substance reasonably satisfactory to the Representatives, confirming as of the Option Closing Date, the statements made by such counsel in their opinions delivered on the Closing Date.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2.5. <u>Reliance</u>. In rendering such opinions, such counsel may rely: (i) as to matters involving the application of laws other than the laws of the United States and jurisdictions in which they are admitted, to the extent such counsel deems proper and to the extent specified in such opinion, if at all, upon an opinion or opinions (in form and substance reasonably satisfactory to the Representatives) of other counsel reasonably acceptable to the Representatives, familiar with the applicable laws; and (ii) as to matters of fact, to the extent they deem proper, on certificates or other written statements of officers of the Company and officers of departments of various jurisdictions having custody of documents respecting the corporate existence or good standing of the Company, *provided* that copies of any such statements or certificates shall be delivered to Representatives' Counsel if requested.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*4.3. <u>Comfort Letters</u>.*

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3.1. <u>Cold Comfort Letter</u>. At the time this Agreement is executed you shall have received a cold comfort letter containing statements and information of the type customarily included in accountants' comfort letters with respect to the financial statements and certain financial information contained in the Registration Statement, the Pricing Disclosure Package and the Prospectus, addressed to the Representatives and in form and substance satisfactory in all respects to you and to the Auditor, dated as of the date of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3.2. <u>Bring-down Comfort Letter</u>. At each of the Closing Date and the Option Closing Date, if any, the Representatives shall have received from the Auditor a letter, dated as of the Closing Date or the Option Closing Date, as applicable, to the effect that the Auditor reaffirms the statements made in the letter furnished pursuant to <u>Section 4.3.1</u>, except that the specified date referred to shall be a date not more than three (3) Business Days prior to the Closing Date or the Option Closing Date, as applicable.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*4.4. <u>Officers' Certificates</u>.*

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4.1. <u>Officers' Certificate</u>. The Company shall have furnished to the Representatives a certificate, dated the Closing Date and any Option Closing Date (if such date is other than the Closing Date), of its Chief Executive Officer, its President and its Chief Financial Officer stating that (i) such officers have carefully examined the Registration Statement, the Pricing Disclosure Package, any Issuer Free Writing Prospectus and the Prospectus and, in their opinion, the Registration Statement and each amendment thereto, as of the Applicable Time and as of the Closing Date (or any Option Closing Date if such date is other than the Closing Date) did not include any untrue statement of a material fact and did not omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading, and the Pricing Disclosure Package, as of the Applicable Time and as of the Closing Date (or any Option Closing Date if such date is other than the Closing Date), any Issuer Free Writing Prospectus as of its date and as of the Closing Date (or any Option Closing Date if such date is other than the Closing Date), the Prospectus and each amendment or supplement thereto, as of the respective date thereof and as of the Closing Date, did not include any untrue statement of a material fact and did not omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances in which they were made, not misleading, (ii) since the effective date of the Registration Statement, no event has occurred which should have been set forth in a supplement or amendment to the Registration Statement, the Pricing Disclosure Package or the Prospectus, (iii) to the best of their knowledge after reasonable investigation, as of the Closing Date (or any Option Closing Date if such date is other than the Closing Date), the representations and warranties of the Company in this Agreement are true and correct in all material respects (except for those representations and warranties qualified as to materiality, which shall be true and correct in all respects and except for those representations and warranties which refer to facts existing at a specific date, which shall be true and correct as of such date) and the Company has complied with all agreements and satisfied all conditions on its part to be performed or satisfied hereunder at or prior to the Closing Date (or any Option Closing Date if such date is other than the Closing Date), and (iv) there has not been, subsequent to the date of the most recent audited financial statements included or incorporated by reference in the Pricing Disclosure Package, a Material Adverse Change.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4.2. <u>Secretary's Certificate</u>. At each of the Closing Date and the Option Closing Date, if any, the Representatives shall have received a certificate of the Company signed by the Secretary of the Company, dated the Closing Date or the Option Date, as the case may be, respectively, certifying: (i) that each of the Charter and Bylaws is true and complete, has not been modified and is in full force and effect; (ii) that the resolutions of the Company's Board of Directors (and any pricing committee thereof) relating to the Offering are in full force and effect and have not been modified; (iii) as to the accuracy and completeness of all correspondence between the Company or its counsel and the Commission; and (iv) as to the incumbency of the officers of the Company. The documents referred to in such certificate shall be attached to such certificate.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*4.5. <u>No Material Changes</u>*. Prior to and on each of the Closing Date and each Option Closing Date, if any: (i) there shall have been no Material Adverse Change in the condition or prospects or the business activities, financial or otherwise, of the Company from the latest dates as of which such condition is set forth in the Registration Statement, the Pricing Disclosure Package and the Prospectus; (ii) no action, suit or proceeding, at law or in equity, shall have been pending or threatened against the Company or any Insider before or by any court or federal or state commission, board or other administrative agency wherein an unfavorable decision, ruling or finding may reasonably be expected to cause a Material Adverse Change, except as set forth in the Registration Statement, the Pricing Disclosure Package and the Prospectus; (iii) no stop order shall have been issued under the Securities Act and no proceedings therefor shall have been initiated or threatened by the Commission; and (iv) the Registration Statement, the Pricing Disclosure Package and the Prospectus and any amendments or supplements thereto shall contain all material statements which are required to be stated therein in accordance with the Securities Act and the Securities Act Regulations and shall conform in all material respects to the requirements of the Securities Act and the Securities Act Regulations, and neither the Registration Statement, the Pricing Disclosure Package nor the Prospectus nor any amendment or supplement thereto shall contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*4.6. <u>Delivery of Agreements</u>.*

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.6.1. <u>Lock-Up Agreements</u>. On or before the date of this Agreement, the Company shall have delivered to the Representatives executed copies of the Lock-Up Agreements from each of the persons listed in <u>Schedule 3</u> hereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*4.7. <u>Additional Documents</u>*. At the Closing Date and at each Option Closing Date (if any) Representatives' Counsel shall have been furnished with such documents and opinions as they may require for the purpose of enabling Representatives' Counsel to deliver an opinion to the Underwriters, or in order to evidence the accuracy of any of the representations or warranties, or the fulfillment of any of the conditions, herein contained; and all proceedings taken by the Company in connection with the issuance and sale of the Shares and the Representatives' Warrants as herein contemplated shall be satisfactory in form and substance to the Representatives and Representatives' Counsel.

5. <u>Indemnification</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*5.1. <u>Indemnification of the Underwriters</u>.*

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1.1. <u>General</u>. Subject to the conditions set forth below, the Company agrees to indemnify, defend and hold harmless each Underwriter, its affiliates and each of its and their respective directors, officers, members, employees, representatives, partners, shareholders, affiliates, counsel, and agents and each person, if any, who controls any such Underwriter within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act (collectively the "**Underwriter Indemnified Parties**," and each an "**Underwriter Indemnified Party**"), from and against any and all loss, liability, claim, damage and expense whatsoever (including but not limited to any and all legal or other expenses reasonably incurred in investigating, preparing or defending against any litigation, commenced or threatened, or any claim whatsoever, whether arising out of any action between any of the Underwriter Indemnified Parties and the Company or between any of the Underwriter Indemnified Parties and any third party, or otherwise) to which they or any of them may become subject under the Securities Act, the Exchange Act or any other statute or at common law or otherwise or under the laws of foreign countries (a "**Claim**"), arising out of or based upon any untrue statement or alleged untrue statement of a material fact contained, or the omission or alleged omission therefrom of a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, in (A) the Registration Statement, the Pricing Disclosure Package, any Preliminary Prospectus, the Prospectus, or in any Issuer Free Writing Prospectus or in any Written Testing-the-Waters Communication (as from time to time each may be amended and supplemented); (B) any materials or information provided to investors by, or with the approval of, the Company in connection with the marketing of the Offering, including any "road show" or investor presentations made to investors by the Company (whether in person or electronically); or (C) any application or other document or written communication (in this <u>Section 5</u>, collectively called "application") executed by the Company or based upon written information furnished by the Company in any jurisdiction in order to qualify the Shares and Representatives' Warrants under the securities laws thereof or filed with the Commission, any state securities commission or agency, the Exchange or any other national securities exchange; *unless*, with respect to each subsection (A) through (C), such statement or omission was made in reliance upon, and in conformity with, the Underwriters' Information. With respect to any untrue statement or omission or alleged untrue statement or omission made in the Registration Statement, Pricing Disclosure Package or Prospectus, the indemnity agreement contained in this <u>Section 5.1.1</u> shall not inure to the benefit of any Underwriter Indemnified Party to the extent that any loss, liability, claim, damage or expense of such Underwriter Indemnified Party results from the fact that a copy of the Prospectus was not given or sent to the person asserting any such loss, liability, claim or damage at or prior to the written confirmation of sale of the Shares to such person as required by the Securities Act and the Securities Act Regulations, and if the untrue statement or omission has been corrected in the Prospectus, unless such failure to deliver the Prospectus was a result of non-compliance by the Company with its obligations under <u>Section 3.3</u> hereof. The Company also agrees that it will reimburse each Underwriter Indemnified Party for all reasonable fees and expenses (including but not limited to any and all legal or other expenses reasonably incurred in investigating, preparing or defending against any litigation, commenced or threatened, or any claim whatsoever, whether arising out of any action between any of the Underwriter Indemnified Parties and the Company or between any of the Underwriter Indemnified Parties and any third party, or otherwise) (collectively, the "**Expenses**"), and further agrees wherever and whenever possible to advance payment of Expenses as they are incurred by an Underwriter Indemnified Party in investigating, preparing, pursuing or defending any Claim.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1.2. <u>Procedure</u>. If any action is brought against an Underwriter Indemnified Party in respect of which indemnity may be sought against the Company pursuant to <u>Section 5.1.1</u>, such Underwriter Indemnified Party shall promptly notify the Company in writing of the institution of such action and the Company shall assume the defense of such action, including the employment and fees of counsel (subject to the approval of such Underwriter Indemnified Party (which approval shall not be unreasonably withheld)) and payment of actual expenses if an Underwriter Indemnified Party requests that the Company do so. Such Underwriter Indemnified Party shall have the right to employ its or their own counsel in any such case, and the fees and expenses of such counsel shall be at the expense of the Company and shall be advanced by the Company; *provided*, *however*, that the Company shall not be obligated to bear the reasonable fees and expenses of more than one firm of attorneys selected by the Underwriter Indemnified Party (in addition to local counsel). Notwithstanding anything to the contrary contained herein, and provided that the Company has timely honored its obligations under <u>Section 5</u>, the Underwriter Indemnified Party shall not enter into any settlement without the prior written consent (which shall not be unreasonably withheld) of the terms of any settlement by the Company. The Company shall not be liable for any settlement of any action effected without its prior written consent (which shall not be unreasonably withheld). In addition, the Company shall not, without the prior written consent of the Underwriters (which consent shall not be unreasonably withheld), settle, compromise or consent to the entry of any judgment in or otherwise seek to terminate any pending or threatened action in respect of which advancement, reimbursement, indemnification or contribution may be sought hereunder (whether or not such Underwriter Indemnified Party is a party thereto) unless such settlement, compromise, consent or termination (i) includes an unconditional release of each Underwriter Indemnified Party, acceptable to such Underwriter Indemnified Party, from all liabilities, expenses and claims arising out of such action for which indemnification or contribution may be sought and (ii) does not include a statement as to or an admission of fault, culpability or a failure to act, by or on behalf of any Underwriter Indemnified Party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*5.2. <u>Indemnification of the Company</u>*. Each Underwriter, severally and not jointly, agrees to indemnify and hold harmless the Company, its directors, its officers who signed the Registration Statement and persons who control the Company within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act against any and all loss, liability, claim, damage and expense described in the foregoing indemnity from the Company to the several Underwriters, as incurred, but only with respect to such losses, liabilities, claims, damages and expenses (or actions in respect thereof) which arise out of or are based upon untrue statements or omissions, or alleged untrue statements or omissions made in the Registration Statement, any Preliminary Prospectus, the Pricing Disclosure Package or Prospectus or any amendment or supplement thereto or in any application, in reliance upon, and in conformity with, the Underwriters' Information. In case any action shall be brought against the Company or any other person so indemnified based on any Preliminary Prospectus, the Registration Statement, the Pricing Disclosure Package or Prospectus or any amendment or supplement thereto or any application, and in respect of which indemnity may be sought against any Underwriter, such Underwriter shall have the rights and duties given to the Company, and the Company and each other person so indemnified shall have the rights and duties given to the several Underwriters by the provisions of <u>Section 5.1.2</u>. The Company agrees promptly to notify the Representatives of the commencement of any litigation or proceedings against the Company or any of its officers, directors or any person, if any, who controls the Company within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act, in connection with the issuance and sale of the Shares or in connection with the Registration Statement, the Pricing Disclosure Package, the Prospectus, or any Issuer Free Writing Prospectus or any Written Testing-the-Waters Communication.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*5.3. <u>Contribution</u>.* If the indemnification provided for in this Section 5 shall for any reason be unavailable to or insufficient to hold harmless an indemnified party under Section 5.1 or 5.2 in respect of any liabilities and Expenses referred to therein, then each indemnifying party shall, in lieu of indemnifying such indemnified party, contribute to the amount paid or payable by such indemnified party as a result of such liabilities and Expenses, (i) in such proportion as shall be appropriate to reflect the relative benefits received by the Company, on the one hand, and each of the Underwriters, on the other hand, from the Offering, or (ii) if the allocation provided by clause (i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of the Company, on the one hand, and the Underwriters, on the other hand, in connection with the matters as to which such liabilities or Expenses relate, as well as any other relevant equitable considerations. The relative benefits received by the Company, on the one hand, and the Underwriters, on the other, with respect to such Offering shall be deemed to be in the same proportion as the total net proceeds actually received by the Company from the Offering of the Shares purchased under this Agreement (before deducting expenses) received by the Company bear to the total underwriting discounts and commissions actually received by the Underwriters in connection with the Offering, in each case as set forth in the table on the cover page of the Prospectus. The relative fault of the Company, on the one hand, and the Underwriters, on the other, shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company, on the one hand, or the Underwriters, on the other, and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such untrue statement, omission, act or failure to act; *provided* that the parties hereto agree that the written information furnished to the Company through the Representatives by or on behalf of any Underwriter for use in any Preliminary Prospectus, any Registration Statement or the Prospectus, or in any amendment or supplement thereto, consists solely of the Underwriters' Information. The Company and the Underwriters agree that it would not be just and equitable if contributions pursuant to this subsection (d) were determined by pro rata allocation (even if the Underwriters were treated as one entity for such purpose) or by any other method of allocation which does not take into account the equitable considerations referred to above in this subsection (d). Notwithstanding the above, no person guilty of fraudulent misrepresentation within the meaning of Section 11(f) of the Securities Act shall be entitled to contribution from a party who was not guilty of such fraudulent misrepresentation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*5.4. <u>Limitation</u>*. The Company also agrees that no Underwriter Indemnified Party shall have any liability (whether direct or indirect, in contract or tort or otherwise) to the Company for or in connection with advice or services rendered or to be rendered by any Underwriter Indemnified Party pursuant to this Agreement, the transactions contemplated thereby or any Underwriter Indemnified Party's actions or inactions in connection with any such advice, services or transactions, except to the extent that a court of competent jurisdiction has made a finding that liabilities (and related Expenses) of the Company have resulted from such Underwriter Indemnified Party's fraud, bad faith, gross negligence or willful misconduct in connection with any such advice, actions, inactions or services or such Underwriter Indemnified Party's breach of this Agreement or any obligations of confidentiality owed to the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*5.5. <u>Survival & Third-Party Beneficiaries</u>*. The advancement, reimbursement, indemnity and contribution obligations set forth in this Section 5 shall remain in full force and effect regardless of any termination of, or the completion of any Underwriter Indemnified Party's services under or in connection with, this Agreement. Each Underwriter Indemnified Party's is an intended third-party beneficiary of this Section 5, and has the right to enforce the provisions of Section 5 as if he/she/it was a party to this Agreement.

6. <u>Right of First Refusal</u>. During the period ending two years after the Closing Date, if and only if the closing of the purchase of the Firm Shares hereunder actually occurs, the Company grants the Representatives the right of first refusal to act as financial advisor, or as lead managing underwriter, book runner, placement agent, or to act as joint advisor, underwriter, or placement agent, on at least equal economic terms on any public or private financing (debt or equity), merger, business combination, recapitalization or sale of some or all of the equity or assets of the Company, whether in conjunction with another broker-dealer or on the Company's own volition, (collectively, "<u>Future Services</u>"). In the event the Company notifies Representatives of its intention to pursue an activity that would enable Representatives to exercise its right of first refusal to provide Future Services, Representatives shall notify the Company of its election to provide such Future Services, including notification of the compensation and other terms to which Representatives shall be entitled, within thirty (30) days of written notice by the Company. In the event the Company engages Representatives to provide such Future Services, Representatives will be compensated consistent with the compensation in this Agreement, unless mutually agreed otherwise by the Company and Representatives.

7. <u>Effective Date of this Agreement and Termination Thereof</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*7.1. <u>Effective Date</u>*. This Agreement shall become effective when both the Company and the Representatives have executed the same and delivered counterparts of such signatures to the other party.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*7.2. <u>Termination</u>.* The Representatives shall have the right to terminate this Agreement at any time prior to any Closing Date, (i) if any domestic or international event or act or occurrence has materially disrupted, or in your opinion will in the immediate future materially disrupt, general securities markets in the United States; or (ii) if trading on the New York Stock Exchange or the Nasdaq Stock Market LLC shall have been suspended or materially limited, or minimum or maximum prices for trading shall have been fixed, or maximum ranges for prices for securities shall have been required by FINRA or by order of the Commission or any other government authority having jurisdiction; or (iii) if the United States shall have become involved in a new war or an increase in major hostilities; or (iv) if a banking moratorium has been declared by a New York State or federal authority; or (v) if a moratorium on foreign exchange trading has been declared which materially adversely impacts the United States securities markets; or (vi) if the Company shall have sustained a material loss by fire, flood, accident, hurricane, earthquake, theft, sabotage or other calamity or malicious act which, whether or not such loss shall have been insured, will, in your opinion, make it inadvisable to proceed with the delivery of the Firm Shares or Option Shares; or (vii) if the Company is in material breach of any of its representations, warranties or covenants hereunder; or (viii) if the Representatives shall have become aware after the date hereof of such a Material Adverse Change, or such adverse material change in general market conditions as in the Representatives' judgment would make it impracticable to proceed with the offering, sale and/or delivery of the Shares or to enforce contracts made by the Underwriters for the sale of the Shares.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*7.3. <u>Expenses</u>.* Notwithstanding anything to the contrary in this Agreement, in the event that this Agreement shall not be carried out for any reason whatsoever, within the time specified herein or any extensions thereof pursuant to the terms herein, the Company shall be obligated to pay to the Underwriters their actual and accountable out-of-pocket expenses related to the transactions contemplated herein then due and payable up to the amounts set forth in *Section 3.10.1* and upon demand the Company shall pay such amount thereof to the Representatives on behalf of the Underwriters; *provided*, *however*, that such expense cap in no way limits or impairs the indemnification and contribution provisions of this Agreement. Notwithstanding the foregoing, any advance received by the Representatives will be reimbursed to the Company to the extent not actually incurred in compliance with FINRA Rule 5110(g)(4)(A).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*7.4. <u>Indemnification</u>*. Notwithstanding any contrary provision contained in this Agreement, any election hereunder or any termination of this Agreement, and whether or not this Agreement is otherwise carried out, the provisions of <u>Section 5</u> shall remain in full force and effect and shall not be in any way affected by, such election or termination or failure to carry out the terms of this Agreement or any part hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*7.5. <u>Representations, Warranties, Agreements to Survive</u>*. All representations, warranties and agreements contained in this Agreement or in certificates of officers of the Company submitted pursuant hereto, shall remain operative and in full force and effect regardless of (i) any investigation made by or on behalf of any Underwriter or its Affiliates or selling agents, any person controlling any Underwriter, its officers or directors or any person controlling the Company or (ii) delivery of and payment for the Shares.

8. <u>Miscellaneous</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*8.1. <u>Notices</u>.* All communications hereunder, except as herein otherwise specifically provided, shall be in writing and shall be mailed (registered or certified mail, return receipt requested), personally delivered or sent by facsimile transmission and confirmed and shall be deemed given when so delivered or faxed and confirmed or if mailed, two (2) days after such mailing.

If to the Representatives:

**Boustead Securities, LLC**

6 Venture, Suite 395

Irvine, CA 92618

Attn: Keith Moore

Fax No: (815) 301-8099

**EF Hutton**

590 Madison Avenue, 39<sup>th</sup> Floor

New York, New York 10022

Attn: [\*]

Fax No.: [\*]

*With a copy (which shall not constitute notice) to:*

**Bevilacqua PLLC**

1050 Connecticut Ave, NW, Suite 500

Washington, DC 20036

Attention: Louis A. Bevilacqua

Fax No: 202-869-0889

If to the Company:

**Hempacco Co., Inc.**

9925 Airway Road

San Diego, California 92154

Attention: Sandro Piancone

Fax No: (619) 779-0715

*With a copy (which shall not constitute notice) to*:

**BRUNSON CHANDLER & JONES, PLLC**

175 S. Main Street, Suite 1410

Salt Lake City, UT 84111

Attention: Lance Brunson, Esq.

Attention: Callie Tempest Jones, Esq.

Fax No: 855-362-6049

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*8.2. <u>Headings</u>.* The headings contained herein are for the sole purpose of convenience of reference, and shall not in any way limit or affect the meaning or interpretation of any of the terms or provisions of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*8.3. <u>Amendment</u>.* This Agreement may only be amended by a written instrument executed by each of the parties hereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*8.4. <u>Entire Agreement</u>.* This Agreement (together with the other agreements and documents being delivered pursuant to or in connection with this Agreement) constitutes the entire agreement of the parties hereto with respect to the subject matter hereof and thereof, and supersedes all prior agreements and understandings of the parties, oral and written, with respect to the subject matter hereof. Notwithstanding anything to the contrary set forth herein, it is understood and agreed by the parties hereto that all other terms and conditions of that certain engagement letter between the Company and Boustead Securities LLC, dated August 11, 2021, as such engagement letter may be amended from time to time, shall remain in full force and effect.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*8.5. <u>Binding Effect</u>.* This Agreement shall inure solely to the benefit of and shall be binding upon the Representatives, the Underwriters, the Company and the controlling persons, directors and officers referred to in <u>Section 5</u> hereof, and their respective successors, legal representatives, heirs and assigns, and no other person shall have or be construed to have any legal or equitable right, remedy or claim under or in respect of or by virtue of this Agreement or any provisions herein contained. The term "successors and assigns" shall not include a purchaser, in its capacity as such, of securities from any of the Underwriters.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*8.6. <u>Governing Law; Consent to Jurisdiction; Trial by Jury</u>.* This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of New York, without giving effect to conflict of laws principles thereof. The Company hereby agrees that any action, proceeding or claim against it arising out of, or relating in any way to this Agreement shall be brought and enforced in the New York Supreme Court, County of New York, or in the United States District Court for the Southern District of New York, and irrevocably submits to such jurisdiction, which jurisdiction shall be exclusive. The Company hereby waives any objection to such exclusive jurisdiction and that such courts represent an inconvenient forum. Any such process or summons to be served upon the Company may be served by transmitting a copy thereof by registered or certified mail, return receipt requested, postage prepaid, addressed to it at the address set forth in <u>Section 8.1</u> hereof. Such mailing shall be deemed personal service and shall be legal and binding upon the Company in any action, proceeding or claim. The Company agrees that the prevailing party(ies) in any such action shall be entitled to recover from the other party(ies) all of its reasonable attorneys' fees and expenses relating to such action or proceeding and/or incurred in connection with the preparation therefor. The Company (on its behalf and, to the extent permitted by applicable law, on behalf of its Shareholders and affiliates) and each of the Underwriters hereby irrevocably waives, to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal proceeding arising out of or relating to this Agreement or the transactions contemplated hereby.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*8.7. <u>Execution in Counterparts</u>.* This Agreement may be executed in one or more counterparts, and by the different parties hereto in separate counterparts, each of which shall be deemed to be an original, but all of which taken together shall constitute one and the same agreement, and shall become effective when one or more counterparts has been signed by each of the parties hereto and delivered to each of the other parties hereto. Delivery of a signed counterpart of this Agreement by facsimile or email/pdf transmission shall constitute valid and sufficient delivery thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;*8.8. <u>Waiver, etc</u>*. The failure of any of the parties hereto to at any time enforce any of the provisions of this Agreement shall not be deemed or construed to be a waiver of any such provision, nor to in any way effect the validity of this Agreement or any provision hereof or the right of any of the parties hereto to thereafter enforce each and every provision of this Agreement. No waiver of any breach, non-compliance or non-fulfillment of any of the provisions of this Agreement shall be effective unless set forth in a written instrument executed by the party or parties against whom or which enforcement of such waiver is sought; and no waiver of any such breach, non-compliance or non-fulfillment shall be construed or deemed to be a waiver of any other or subsequent breach, non-compliance or non-fulfillment.

*[Signature Page Follows]*

If the foregoing correctly sets forth the understanding between the Underwriters and the Company, please so indicate in the space provided below for that purpose, whereupon this letter shall constitute a binding agreement between us.

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| | |
|:---|:---|
| Very truly yours, | Very truly yours, |
| **Hempacco Co., Inc.** | **Hempacco Co., Inc.** |
| By: |  |
|  | Name: Sandro Piancone |
|  | Title: Chief Executive Officer |

---

Confirmed as of the date first written above mentioned, on behalf of itself and as Representative of the several Underwriters named on <u>Schedule 1</u> hereto:

---

| | |
|:---|:---|
| **Boustead Securities, LLC** | **Boustead Securities, LLC** |
| By: |  |
|  | Name: Keith Moore |
|  | Title: Chief Executive Officer |

---

---

| | |
|:---|:---|
| **EF Hutton,** <br> **division of Benchmark Investments, LLC** | **EF Hutton,** <br> **division of Benchmark Investments, LLC** |
| By: |  |
|  | Name:  |
|  | Title:  |

---

**<u>SCHEDULE 1</u>**

---

| | | |
|:---|:---|:---|
| ***Underwriter*** | **Total** <br> Number<br> of<br> Firm<br> Shares<br> to be<br> Purchased | **Number of** <br> Additional<br> Option Shares<br> to be<br> Purchased if the<br> Over-<br> Allotment<br> Option is<br> Fully Exercised |
| **Boustead Securities, LLC** |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp; **EF Hutton, division of Benchmark Investments, LLC** |  |  |
| **TOTAL** |  |  |

---

**<u>SCHEDULE 2-A</u>**

**Pricing Information**

Number of Firm Shares:

Number of Option Shares:

Public Offering Price per Firm Share: $

Public Offering Price per Option Share: $

Underwriting Discount per Firm Share: $

Underwriting Discount per Option Share: $

Non-Accountable Expense Allowance per Firm Share: $

Non-Accountable Expense Allowance per Option Share: $

**<u>SCHEDULE 2-B</u>**

**Issuer General Use Free Writing Prospectuses**

None

**<u>SCHEDULE 2-C</u>**

**Written Testing-the-Waters Communications**

**<u>SCHEDULE 3</u>**

**List of Lock-Up Parties**

**Directors and Officers**

Sandro Piancone

Neville Pearson

Jorge Olson

Dr. Stuart Titus

Jerry Halamuda

Miki Stephens

**Shareholders**

---

| | |
|:---|:---|
| Green Globe International | Sanzo, Louis |
| Adegbenro, Adewale | Titus, Stuart W |
| Beasley, Roger K | Uchimura, Ross S |
| Celli, Victor | Gonda, Richard |
| Dimick, Charles D Rev Tr | Matthews, Gilbert |
| Davila, Pedro | Dimick, Charles D Rev Tr |
| Ennis, Duane | Drake, David |
| Halamuda Trust | Gonda, Richard |
| Harris, Marsha | Martinez, Lisa |
| Joseph, Phillip | Nakamura, Yuki |
| Lurch, Bert | Rich, Michael T. |
| Mendolia, Savatore D | Seneca, J. Conrad |
| Pearson, Neville and Sharon | Uchimura, Ross S |
| Pashayan, Richard | Nery Logistics |
| Sacchetti, Anna |  |

---

**<u>EXHIBIT A</u>**

**Form of Representatives' Warrant**

THE REGISTERED HOLDER OF THIS PURCHASE WARRANT BY ITS ACCEPTANCE HEREOF, AGREES THAT IT WILL NOT SELL, TRANSFER OR ASSIGN THIS PURCHASE WARRANT EXCEPT AS HEREIN PROVIDED AND THE REGISTERED HOLDER OF THIS PURCHASE WARRANT AGREES THAT IT WILL NOT SELL, TRANSFER, ASSIGN, PLEDGE OR HYPOTHECATE THIS PURCHASE WARRANT FOR A PERIOD OF ONE HUNDRED EIGHTY DAYS FOLLOWING [\*], 2023 (THE "**EFFECTIVE DATE**") TO ANYONE OTHER THAN (I) BOUSTEAD SECURITIES, LLC OR A SELECTED DEALER IN CONNECTION WITH THE OFFERING FOR WHICH THIS PURCHASE WARRANT WAS ISSUED TO THE UNDERWRITER AS CONSIDERATION (THE "OFFERING"), OR (II) A BONA FIDE OFFICER OR PARTNER OF BOUSTEAD SECURITIES, LLC.

THIS PURCHASE WARRANT IS NOT EXERCISABLE PRIOR TO [\*], 2023 (THE DATE OF ISSUANCE). VOID AFTER 5:00 P.M., EASTERN TIME, [\*], 2028 (THE DATE THAT IS FIVE YEARS FROM COMMENCEMENT OF SALES OF COMMON STOCK IN THE OFFERING).

**COMMON STOCK PURCHASE WARRANT**

For the Purchase of [\*] Shares of Common Stock

of

Hempacco Co., Inc.

1. <u>Purchase Warrant</u>. THIS CERTIFIES THAT, in consideration of funds duly paid by or on behalf of Boustead Securities, LLC ("**Holder**"), as registered owner of this Purchase Warrant, to Hempacco Co., Inc., a Nevada corporation (the "**Company**"), Holder is entitled, at any time or from time to time beginning [\*], 2023 (the "**Issue Date**"), and at or before 5:00 p.m., Eastern time, [\*], 2028 (the "**Expiration Date**"), but not thereafter, to subscribe for, purchase and receive, in whole or in part, up to [\*] shares of common stock of the Company, par value $0.001 per share (the "**Shares**"), subject to adjustment as provided in Section 6 hereof. If the Expiration Date is a day on which banking institutions are authorized by law to close, then this Purchase Warrant may be exercised on the next succeeding day which is not such a day in accordance with the terms herein. During the period ending on the Expiration Date, the Company agrees not to take any action that would terminate this Purchase Warrant. This Purchase Warrant is initially exercisable at **$**[\*] per Share<sup>1</sup>; <u>provided</u>, <u>however</u>, that upon the occurrence of any of the events specified in Section 6 hereof, the rights granted by this Purchase Warrant, including the exercise price per Share and the number of Shares to be received upon such exercise, shall be adjusted as therein specified. The term "**Exercise Price**" shall mean the initial exercise price or the adjusted exercise price, depending on the context.

2. <u>Exercise</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1 <u>Exercise Form</u>. In order to exercise this Purchase Warrant, the exercise form attached hereto must be duly executed and completed and delivered to the Company, together with this Purchase Warrant and payment of the Exercise Price for the Shares being purchased payable in cash by wire transfer of immediately available funds to an account designated by the Company or by certified check or official bank check. If the subscription rights represented hereby shall not be exercised at or before 5:00 p.m., Eastern time, on the Expiration Date, this Purchase Warrant shall become and be void without further force or effect, and all rights represented hereby shall cease and expire. Each exercise hereof shall be irrevocable.

_____________________________

<sup>1</sup> 100% of public offering price

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2 <u>Cashless Exercise</u>. In lieu of exercising this Purchase Warrant by payment of cash or check payable to the order of the Company pursuant to Section 2.1 above, Holder may elect to receive the number of Shares equal to the value of this Purchase Warrant (or the portion thereof being exercised), by surrender of this Purchase Warrant to the Company, together with the exercise form attached hereto, in which event the Company will issue to Holder Shares in accordance with the following formula:

X = <u>Y(A-B)</u> <br> A

---

| | | | |
|:---|:---|:---|:---|
| Where, |  |  |  |
| | X | = | The number of Shares to be issued to Holder; |
| | Y | = | The number of Shares for which the Purchase Warrant is being exercised; |
| | A | = | The fair market value of one Share; and |
| | B | = | The Exercise Price. |

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For purposes of this Section 2.2, the fair market value means, for any date, the price determined by the first of the following clauses that applies: (a) if the common stock is then listed or quoted on a Eligible Market, the value shall be deemed to be the highest intra-day or closing price on any trading day on such Eligible Market on which the common stock is then listed or quoted as reported by Bloomberg L.P. (based on a Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)) during the five trading days preceding the exercise, (b) if OTCQB or OTCQX is not an Eligible Market, the value shall be deemed to be the highest intra-day or closing price on any trading day on the OTCQB or OTCQX on which the common stock is then quoted as reported by Bloomberg L.P. (based on a Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)) during the five trading days preceding the exercise, as applicable, (c) if the common stock is not then listed or quoted for trading on OTCQB or OTCQX and if prices for the common stock are then reported in the "Pink Sheets" published by OTC Markets Group, Inc. (or a similar organization or agency succeeding to its functions of reporting prices), the "OTC Markets Group", the value shall be deemed to be the highest intra-day or closing price on any trading day on the Pink Sheets on which the common stock is then quoted as reported by OTC Markets Group (based on a Trading Day from 9:30 a.m. (New York City time) to 4:02 p.m. (New York City time)) during the five trading days preceding the exercise, or (d) in all other cases, the fair market value of a share of common stock as determined by an independent appraiser selected in good faith by the Holder and reasonably acceptable to the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3 <u>Legend</u>. Each certificate for the securities purchased under this Purchase Warrant shall bear a legend as follows unless such securities have been registered under the Securities Act of 1933, as amended (the "**Act**"):

"The securities represented by this certificate have not been registered under the Securities Act of 1933, as amended (the "**Act**"), or applicable state law. Neither the securities nor any interest therein may be offered for sale, sold or otherwise transferred except pursuant to an effective registration statement under the Act, or pursuant to an exemption from registration under the Act and applicable state law which, in the opinion of counsel to the Company, is available."

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4 <u>Resale of Shares</u>. Holder and the Company acknowledge that as of the date hereof the Staff of the Division of Corporation Finance of the SEC has published Compliance & Disclosure Interpretation 528.04 in the Securities Act Rules section thereof, stating that the holder of securities issued in connection with a public offering may not rely upon Rule 144 promulgated under the Act to establish an exemption from registration requirements under Section 4(a)(1) under the Act, but may nonetheless apply Rule 144 constructively for the resale of such shares in the following manner: (a) provided that six months has elapsed since the last sale under the registration statement, an underwriter or finder may resell the securities in accordance with the provisions of Rule 144(c), (e), and (f), except for the notice requirement; (b) a purchaser of the shares from an underwriter receives restricted securities unless the sale is made with an appropriate, current prospectus, or unless the sale is made pursuant to the conditions contained in (a) above; (c) a purchaser of the shares from an underwriter who receives restricted securities may include the underwriter's holding period, provided that the underwriter or finder is not an affiliate of the issuer; and (d) if an underwriter transfers the shares to its employees, the employees may tack the firm's holding period for purposes of Rule 144(d), but they must aggregate sales of the distributed shares with those of other employees, as well as those of the underwriter or finder, for a six-month period from the date of the transfer to the employees. Holder and the Company also acknowledge that the Staff of the Division of Corporation Finance of the SEC has advised in various no-action letters that the holding period associated with securities issued without registration to a service provider commences upon the completion of the services, which the Company agrees and acknowledges shall be the final closing of the Offering, and that Rule 144(d)(3)(ii) provides that securities acquired from the issuer solely in exchange for other securities of the same issuer shall be deemed to have been acquired at the same time as the securities surrendered for conversion (which the Company agrees is the date of the initial issuance of this Purchase Warrant). In the event that following a reasonably-timed written request by Holder to transfer the Shares in accordance with Compliance & Disclosure Interpretation 528.04 counsel for the Company in good faith concludes that Compliance & Disclosure Interpretation 528.04 no longer may be relied upon as a result of changes in applicable laws, regulations, or interpretations of the SEC Division of Corporation Finance, or as a result of judicial interpretations not known by the Company or its counsel on the date hereof, then the Company shall promptly, and in any event within five (5) business days following the request, provide written notice to Holder of such determination. As a condition to giving such notice, the parties shall negotiate in good faith a single demand registration right pursuant to an agreement in customary form reasonably acceptable to the parties; provided that notwithstanding anything to the contrary, the obligations of the Company pursuant to this Section 2 shall terminate on the fifth anniversary of the Effective Date. In the absence of such conclusion by counsel for the Company, the Company shall, upon such a request of Holder given no earlier than six months after the final closing of the Offering, instruct its transfer agent to permit the transfer of such shares in accordance with Compliance & Disclosure Interpretation 528.04, provided that Holder has provided such documentation as shall be reasonably be requested by the Company to establish compliance with the conditions of Compliance & Disclosure Interpretation 528.04. Notwithstanding anything to the contrary, pursuant to FINRA Rule 5110(g)(8)(B)-(D), the Holder shall not be entitled to more than one demand registration right hereunder and the duration of the registration rights hereunder shall not exceed five years from the Effective Date.

3. <u>Transfer</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.1 <u>General Restrictions</u>. The registered Holder of this Purchase Warrant agrees by his, her or its acceptance hereof, that such Holder will not for a period of one hundred eighty (180) days following the Effective Date: (a) sell, transfer, assign, pledge or hypothecate this Purchase Warrant to anyone other than: (i) Boustead Securities LLC ("**Boustead**") or an underwriter, placement agent, or a selected dealer participating in the Offering, or (ii) a bona fide officer or partner of Boustead or of any such underwriter, placement agent or selected dealer, in each case in accordance with FINRA Conduct Rule 5110(e)(1), or (b) cause this Purchase Warrant or the securities issuable hereunder to be the subject of any hedging, short sale, derivative, put or call transaction that would result in the effective economic disposition of this Purchase Warrant or the securities hereunder, except as provided for in FINRA Rule 5110(e)(2). After 180 days after the Effective Date, transfers to others may be made subject to compliance with or exemptions from applicable securities laws. In order to make any permitted assignment, the Holder must deliver to the Company the assignment form attached hereto duly executed and completed, together with the Purchase Warrant and payment of all transfer taxes, if any, payable in connection therewith. The Company shall within five (5) Business Days transfer this Purchase Warrant on the books of the Company and shall execute and deliver a new Purchase Warrant or Purchase Warrants of like tenor to the appropriate assignee(s) expressly evidencing the right to purchase the aggregate number of Shares purchasable hereunder or such portion of such number as shall be contemplated by any such assignment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.2 <u>Restrictions Imposed by the Act</u>. The securities evidenced by this Purchase Warrant shall not be transferred unless and until: (i) if required by applicable law, the Company has received the opinion of counsel for the Company that the securities may be transferred pursuant to an exemption from registration under the Act and applicable state securities laws, or (ii) a registration statement or a post-effective amendment to the Registration Statement relating to the offer and sale of such securities has been filed by the Company and declared effective by the U.S. Securities and Exchange Commission (the "**Commission**") and compliance with applicable state securities law has been established.

4. <u>Piggyback Registration Rights</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.1 <u>Grant of Right</u>. Whenever the Company proposes to register any shares of its common stock under the Act (other than (i) a registration effected solely to implement an employee benefit plan or a transaction to which Rule 145 of the Act is applicable, or (ii) a registration statement on Form S-4, S-8 or any successor form thereto or another form not available for registering the Shares issuable upon exercise of this Purchase Warrant for sale to the public, whether for its own account or for the account of one or more stockholders of the Company (a "Piggyback Registration"), the Company shall give prompt written notice (in any event no later than ten (10) Business Days prior to the filing of such registration statement) to the Holder of the Company's intention to effect such a registration and, subject to the remaining provisions of this Section 4.1, shall include in such registration such number of Shares underlying this Purchase Warrant (the "**Registrable Securities**") that the Holders have (within ten (10) Business Days of the respective Holder's receipt of such notice) requested in writing (including such number) to be included within such registration. If a Piggyback Registration is an underwritten offering and the managing underwriter advises the Company that it has determined in good faith that marketing factors require a limit on the number of shares of common stock to be included in such registration, including all Shares issuable upon exercise of this Purchase Warrant (if the Holder has elected to include such shares in such Piggyback Registration) and all other shares of common stock proposed to be included in such underwritten offering, , the Company shall include in such registration (i) first, the number of shares of common stock that the Company proposes to sell and (ii) second, the number of shares of common stock, if any, requested to be included therein by selling stockholders (including the Holder) allocated pro rata among all such persons on the basis of the number of shares of common stock then owned by each such person. If any Piggyback Registration is initiated as a primary underwritten offering on behalf of the Company, the Company shall select the investment banking firm or firms to act as the managing underwriter or underwriters in connection with such offering. Notwithstanding anything to the contrary, the obligations of the Company pursuant to this Section 4.1 shall terminate on the earlier of (i) the seventh anniversary of the Effective Date and (ii) the date that Rule 144 would allow the Holder to sell its Registrable Securities during any ninety (90) day period.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.2 <u>Indemnification</u>. The Company shall indemnify the Holder(s) of the Registrable Securities to be sold pursuant to any registration statement hereunder and each person, if any, who controls such Holders within the meaning of Section 15 of the Act or Section 20 (a) of the Securities Exchange Act of 1934, as amended ("**Exchange Act**"), against all loss, claim, damage, expense or liability (including all reasonable attorneys' fees and other out-of-pocket expenses reasonably incurred in investigating, preparing or defending against any claim whatsoever) to which any of them may become subject under the Act, the Exchange Act or otherwise, arising from such registration statement but only to the same extent and with the same effect as the provisions pursuant to which the Company has agreed to indemnify Boustead contained in the Underwriting Agreement between Boustead and the Company, dated as of [\*], 2023. The Holder(s) of the Registrable Securities to be sold pursuant to such registration statement, and their successors and assigns, shall severally, and not jointly, indemnify the Company, against all loss, claim, damage, expense or liability (including all reasonable attorneys' fees and other expenses reasonably incurred in investigating, preparing or defending against any claim whatsoever) to which they may become subject under the Act, the Exchange Act or otherwise, arising from information furnished by or on behalf of such Holders, or their successors or assigns, in writing, for specific inclusion in such registration statement to the same extent and with the same effect as the provisions contained in the Underwriting Agreement pursuant to which Boustead has agreed to indemnify the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.3 <u>Exercise of Purchase Warrants</u>. Nothing contained in this Purchase Warrant shall be construed as requiring the Holder(s) to exercise their Purchase Warrants prior to or after the initial filing of any registration statement or the effectiveness thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.4 <u>Documents Delivered to Holders</u>. The Company shall deliver promptly to each Holder participating in the offering requesting the correspondence and memoranda described below, copies of all correspondence between the Commission and the Company, its counsel or auditors and all memoranda relating to discussions with the Commission or its staff with respect to the registration statement and permit each Holder and underwriter to do such investigation, upon reasonable advance notice, with respect to information contained in or omitted from the registration statement as it deems reasonably necessary to comply with applicable securities laws or rules of FINRA. Such investigation shall include access to books, records and properties and opportunities to discuss the business of the Company with its officers and independent auditors, all to such reasonable extent and at such reasonable times, during normal business hours, as any such Holder shall reasonably request.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.5 <u>Underwriting Agreement</u>. The Holders shall be parties to any underwriting agreement relating to a Piggyback Registration. Such Holders shall not be required to make any representations or warranties to or agreements with the Company or the underwriters except as they may relate to such Holders, their Shares and the amount and nature of their ownership thereof and their intended methods of distribution.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.6 <u>Documents to be Delivered by Holder(s)</u>. Each of the Holder(s) participating in any of the foregoing offerings shall furnish to the Company a completed and executed questionnaire provided by the Company requesting information customarily sought of selling security holders.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.7 <u>Damages</u>. Should the Company fail to comply with such provisions, the Holder(s) shall, in addition to any other legal or other relief available to the Holder(s), be entitled to obtain specific performance or other equitable (including injunctive) relief against the threatened breach of such provisions or the continuation of any such breach, without the necessity of proving actual damages and without the necessity of posting bond or other security.

5. <u>New Purchase Warrants to be Issued</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.1 <u>Partial Exercise or Transfer</u>. Subject to the restrictions in Section 3 hereof, this Purchase Warrant may be exercised or assigned in whole or in part. In the event of the exercise or assignment hereof in part only, upon surrender of this Purchase Warrant for cancellation, together with the duly executed exercise or assignment form and funds sufficient to pay any Exercise Price and/or transfer tax if exercised pursuant to Section 2.1 hereto, the Company shall cause to be delivered to the Holder without charge a new Purchase Warrant of like tenor to this Purchase Warrant in the name of the Holder evidencing the right of the Holder to purchase the number of Shares purchasable hereunder as to which this Purchase Warrant has not been exercised or assigned.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.2 <u>Lost Certificate</u>. Upon receipt by the Company of evidence satisfactory to it of the loss, theft, destruction or mutilation of this Purchase Warrant and of reasonably satisfactory indemnification or the posting of a bond, determined in the sole discretion of the Company, the Company shall execute and deliver a new Purchase Warrant of like tenor and date. Any such new Purchase Warrant executed and delivered as a result of such loss, theft, mutilation or destruction shall constitute a substitute contractual obligation on the part of the Company.

6. <u>Adjustments</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1 <u>Adjustments to Exercise Price and Number of Securities</u>. The Exercise Price and the number of Shares underlying the Purchase Warrant shall be subject to adjustment from time to time as hereinafter set forth:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1.1 <u>Share Dividends; Split Ups.</u> If, after the date hereof, and subject to the provisions of Section 6.3 below, the number of outstanding Shares is increased by a stock dividend payable in Shares or by a split up of Shares or other similar event, then, on the effective day thereof, the number of Shares purchasable hereunder shall be increased in proportion to such increase in outstanding Shares, and the Exercise Price shall be proportionately decreased.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1.2 <u>Aggregation of Shares</u>. If, after the date hereof, and subject to the provisions of Section 6.3 below, the number of outstanding Shares is decreased by a consolidation, combination or reclassification of Shares or other similar event, then, on the effective date thereof, the number of Shares purchasable hereunder shall be decreased in proportion to such decrease in outstanding Shares, and the Exercise Price shall be proportionately increased.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1.3 <u>Replacement of Securities upon Reorganization, etc.</u> In case of any reclassification or reorganization of the outstanding Shares other than a change covered by Section 6.1.1 or 6.1.2 hereof or that solely affects the par value of such Shares, or in the case of any share reconstruction or amalgamation or consolidation or merger of the Company with or into another corporation (other than a consolidation or share reconstruction or amalgamation or merger in which the Company is the continuing corporation and that does not result in any reclassification or reorganization of the outstanding Shares), or in the case of any sale or conveyance to another corporation or entity of the property of the Company as an entirety or substantially as an entirety in connection with which the Company is dissolved, the Holder of this Purchase Warrant shall have the right thereafter (until the expiration of the right of exercise of this Purchase Warrant) to receive upon the exercise hereof, for the same aggregate Exercise Price payable hereunder immediately prior to such event, the kind and amount of shares of stock or other securities or property (including cash) receivable upon such reclassification, reorganization, share reconstruction or amalgamation, or consolidation, or upon a dissolution following any such sale or transfer, by a Holder of the number of Shares of the Company obtainable upon exercise of this Purchase Warrant immediately prior to such event; and if any reclassification also results in a change in Shares covered by Section 6.1.1 or 6.1.2, then such adjustment shall be made pursuant to Sections 6.1.1, 6.1.2 and this Section 6.1.3. The provisions of this Section 6.1.3 shall similarly apply to successive reclassifications, reorganizations, share reconstructions or amalgamations, or consolidations, sales or other transfers.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.1.4 <u>Changes in Form of Purchase Warrant.</u> This form of Purchase Warrant need not be changed because of any change pursuant to this Section 6.1, and Purchase Warrants issued after such change may state the same Exercise Price and the same number of Shares as are stated in the Purchase Warrants initially issued pursuant to this Agreement. The acceptance by any Holder of the issuance of new Purchase Warrants reflecting a required or permissive change shall not be deemed to waive any rights to an adjustment occurring after the Issue Date or the computation thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2 <u>Substitute Purchase Warrant</u>. In case of any consolidation of the Company with, or share reconstruction or amalgamation or merger of the Company with or into, another corporation (other than a consolidation or share reconstruction or amalgamation or merger which does not result in any reclassification or change of the outstanding Shares), the corporation formed by such consolidation or share reconstruction or amalgamation shall execute and deliver to the Holder a supplemental Purchase Warrant providing that the holder of each Purchase Warrant then outstanding or to be outstanding shall have the right thereafter (until the stated expiration of such Purchase Warrant) to receive, upon exercise of such Purchase Warrant, the kind and amount of shares of stock and other securities and property receivable upon such consolidation or share reconstruction or amalgamation, by a holder of the number of Shares of the Company for which such Purchase Warrant might have been exercised immediately prior to such consolidation, share reconstruction or amalgamation or merger, sale or transfer. Such supplemental Purchase Warrant shall provide for adjustments which shall be identical to the adjustments provided for in this Section 6. The above provision of this Section shall similarly apply to successive consolidations or share reconstructions or amalgamations or mergers.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.3 <u>Elimination of Fractional Interests</u>. The Company shall not be required to issue certificates representing fractions of Shares upon the exercise of the Purchase Warrant, nor shall it be required to issue scrip or pay cash in lieu of any fractional interests, it being the intent of the parties that all fractional interests shall be eliminated by rounding any fraction up or down, as the case may be, to the nearest whole number of Shares or other securities, properties or rights.

7. <u>Reservation</u>. The Company shall at all times reserve and keep available out of its authorized Shares, solely for the purpose of issuance upon exercise of the Purchase Warrants, such number of Shares or other securities, properties or rights as shall be issuable upon the exercise thereof. The Company covenants and agrees that, upon exercise of the Purchase Warrants and payment of the Exercise Price therefor, in accordance with the terms hereby, all Shares and other securities issuable upon such exercise shall be duly and validly issued, fully paid and non-assessable and not subject to preemptive rights of any shareholder.

8. <u>Certain Notice Requirements</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.1 <u>Holder's Right to Receive Notice</u>. Nothing herein shall be construed as conferring upon the Holders the right to vote or consent or to receive notice as a shareholder for the election of directors or any other matter, or as having any rights whatsoever as a shareholder of the Company. If, however, at any time prior to the expiration of the Purchase Warrants and their exercise, any of the events described in Section 8.2 shall occur, then, in one or more of said events, the Company shall deliver to each Holder a copy of each notice relating to such events given to the other shareholders of the Company at the same time and in the same manner that such notice is given to the shareholders.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.2 <u>Events Requiring Notice</u>. The Company shall be required to give the notice described in this Section 8 upon one or more of the following events: (i) if the Company shall take a record of the holders of its Shares for the purpose of entitling them to receive a dividend or distribution payable otherwise than in cash, or a cash dividend or distribution payable otherwise than out of retained earnings, as indicated by the accounting treatment of such dividend or distribution on the books of the Company, or (ii) the Company shall offer to all the holders of its Shares any additional shares of capital stock of the Company or securities convertible into or exchangeable for shares of capital stock of the Company, or any option, right or warrant to subscribe therefor.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.3 <u>Notice of Change in Exercise Price</u>. The Company shall, promptly after an event requiring a change in the Exercise Price pursuant to Section 6 hereof, send notice to the Holders of such event and change ("**Price Notice**"). The Price Notice shall describe the event causing the change and the method of calculating same.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.4 <u>Transmittal of Notices</u>. All notices, requests, consents and other communications under this Purchase Warrant shall be in writing and shall be deemed to have been duly made when hand delivered, or mailed by express mail or private courier service: (i) if to the registered Holder of the Purchase Warrant, to the address of such Holder as shown on the books of the Company, or (ii) if to the Company, to following address or to such other address as the Company may designate by notice to the Holders:

If to the Holder:

Boustead Securities, LLC

6 Venture, Suite 395

Irvine, CA 92618

Attention: Keith Moore, Chief Executive Officer

Fax No: (815) 301-8099

with a copy (which shall not constitute notice) to:

Bevilacqua PLLC

1050 Connecticut Avenue NW, Suite 500

Washington, DC 20036

Attn: Louis Bevilacqua, Esq.

Fax No.: (202) 869-0889

If to the Company:

Hempacco Co., Inc.

9925 Airway Road

San Diego, California 92154

Attention: Sandro Piancone

Fax No: (619) 779-0715

with a copy (which shall not constitute notice) to:

BRUNSON CHANDLER & JONES, PLLC

175 S. Main Street, Suite 1410

Salt Lake City, UT 84111

Attention: Lance Brunson, Esq.

Attention: Callie Tempest Jones, Esq.

Fax No: 855-362-6049

9. <u>Miscellaneous</u>.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.1 <u>Amendments</u>. The Company and Boustead may from time to time supplement or amend this Purchase Warrant without the approval of any of the Holders in order to cure any ambiguity, to correct or supplement any provision contained herein that may be defective or inconsistent with any other provisions herein, or to make any other provisions in regard to matters or questions arising hereunder that the Company and Boustead may deem necessary or desirable and that the Company and Boustead deem shall not adversely affect the interest of the Holders. All other modifications or amendments shall require the written consent of and be signed by (i) the Company and (ii) the Holder(s) of Purchase Warrants then-exercisable for at least a majority of the Shares then-exercisable pursuant to all then-outstanding Purchase Warrants.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.2 <u>Headings</u>. The headings contained herein are for the sole purpose of convenience of reference, and shall not in any way limit or affect the meaning or interpretation of any of the terms or provisions of this Purchase Warrant.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.3. <u>Entire Agreement</u>. This Purchase Warrant (together with the other agreements and documents being delivered pursuant to or in connection with this Purchase Warrant) constitutes the entire agreement of the parties hereto with respect to the subject matter hereof, and supersedes all prior agreements and understandings of the parties, oral and written, with respect to the subject matter hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.4 <u>Binding Effect</u>. This Purchase Warrant shall inure solely to the benefit of and shall be binding upon, the Holder and the Company and their permitted assignees, respective successors, legal representative and assigns, and no other person shall have or be construed to have any legal or equitable right, remedy or claim under or in respect of or by virtue of this Purchase Warrant or any provisions herein contained.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.5 <u>Governing Law; Submission to Jurisdiction; Trial by Jury</u>. This Purchase Warrant shall be governed by and construed and enforced in accordance with the laws of the State of California, without giving effect to conflict of laws principles thereof. The Company hereby agrees that any action, proceeding or claim against it arising out of, or relating in any way to this Purchase Warrant shall be brought and enforced in the courts located in Los Angeles, California, or in the United States District Court located in Los Angeles, California, and irrevocably submits to such jurisdiction, which jurisdiction shall be exclusive. The Company hereby waives any objection to such exclusive jurisdiction and that such courts represent an inconvenient forum. Any process or summons to be served upon the Company may be served by transmitting a copy thereof by registered or certified mail, return receipt requested, postage prepaid, addressed to it at the address set forth in Section 8 hereof. Such mailing shall be deemed personal service and shall be legal and binding upon the Company in any action, proceeding or claim. The Company and the Holder agree that the prevailing party(ies) in any such action shall be entitled to recover from the other party(ies) all of its reasonable attorneys' fees and expenses relating to such action or proceeding and/or incurred in connection with the preparation therefor. The Company (on its behalf and, to the extent permitted by applicable law, on behalf of its stockholders and affiliates) and the Holder hereby irrevocably waive, to the fullest extent permitted by applicable law, any and all right to trial by jury in any legal proceeding arising out of or relating to this Agreement or the transactions contemplated hereby.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.6 <u>Waiver, etc</u>. The failure of the Company or the Holder to at any time enforce any of the provisions of this Purchase Warrant shall not be deemed or construed to be a waiver of any such provision, nor to in any way affect the validity of this Purchase Warrant or any provision hereof or the right of the Company or any Holder to thereafter enforce each and every provision of this Purchase Warrant. No waiver of any breach, non-compliance or non-fulfillment of any of the provisions of this Purchase Warrant shall be effective unless set forth in a written instrument executed by the party or parties against whom or which enforcement of such waiver is sought; and no waiver of any such breach, non-compliance or non-fulfillment shall be construed or deemed to be a waiver of any other or subsequent breach, non-compliance or non-fulfillment.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.7 <u>Exchange Agreement</u>. As a condition of the Holder's receipt and acceptance of this Purchase Warrant, Holder agrees that, at any time prior to the complete exercise of this Purchase Warrant by Holder, if the Company and Boustead enter into an agreement ("**Exchange Agreement**") pursuant to which they agree that all outstanding Purchase Warrants will be exchanged for securities or cash or a combination of both, then Holder shall agree to such exchange and become a party to the Exchange Agreement.

**[*Signature Page Follows*]**

IN WITNESS WHEREOF, the Company has caused this Purchase Warrant to be signed by its duly authorized officer as of the <sup>[\*]</sup> day of [\*], 2023.

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| | |
|:---|:---|
| **Hempacco Co., Inc.** | **Hempacco Co., Inc.** |
| By: |  |
| Name: | Sandro Piancone |
| Title: | Chief Executive Officer |

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[*Form to be used to exercise Purchase Warrant*]

Date: __________, 20___

The undersigned hereby elects irrevocably to exercise the Purchase Warrant for ______ shares of common stock, par value $0.001 per share (the "**Shares**"), of Hempacco Co., Inc., a Nevada corporation (the "**Company**"), and hereby makes payment of $____ (at the rate of $____ per Share) in payment of the Exercise Price pursuant thereto. Please issue the Shares as to which this Purchase Warrant is exercised in accordance with the instructions given below and, if applicable, a new Purchase Warrant representing the number of Shares for which this Purchase Warrant has not been exercised.

or

The undersigned hereby elects irrevocably to convert its right to purchase ___ Shares of the Company under the Purchase Warrant for ______ Shares, as determined in accordance with the following formula:

 X = <u> Y(A-B)</u> <br> A

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| | | | |
|:---|:---|:---|:---|
| Where, |  |  |  |
|  | X | = | The number of Shares to be issued to Holder; |
|  | Y | = | The number of Shares for which the Purchase Warrant is being exercised; |
|  | A | = | The fair market value of one Share which is equal to $_____; and |
|  | B | = | The Exercise Price which is equal to $______ per share |

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The undersigned agrees and acknowledges that the calculation set forth above is subject to confirmation by the Company and any disagreement with respect to the calculation shall be resolved by the Company in its sole discretion.

Please issue the Shares as to which this Purchase Warrant is exercised in accordance with the instructions given below and, if applicable, a new Purchase Warrant representing the number of Shares for which this Purchase Warrant has not been converted.

Signature _____________________________________________

Signature Guaranteed ____________________________________

INSTRUCTIONS FOR REGISTRATION OF SECURITIES

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| Name: |  |
|  | (Print in Block Letters) |
| Address: |  |

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NOTICE: The signature to this form must correspond with the name as written upon the face of the Purchase Warrant without alteration or enlargement or any change whatsoever, and must be guaranteed by a bank, other than a savings bank, or by a trust company or by a firm having membership on a registered national securities exchange.

[*Form to be used to assign Purchase Warrant*]

ASSIGNMENT

(To be executed by the registered Holder to effect a transfer of the within Purchase Warrant):

FOR VALUE RECEIVED, __________________ does hereby sell, assign and transfer unto the right to purchase shares of common stock, par value $0.001 per share, of Hempacco Co., Inc., a Nevada corporation (the "**Company**"), evidenced by the Purchase Warrant and does hereby authorize the Company to transfer such right on the books of the Company.

Dated: __________, 20__

Signature ____________________________________________

Signature Guaranteed ___________________________________

NOTICE: The signature to this form must correspond with the name as written upon the face of the within Purchase Warrant without alteration or enlargement or any change whatsoever, and must be guaranteed by a bank, other than a savings bank, or by a trust company or by a firm having membership on a registered national securities exchange.

**<u>EXHIBIT B</u>**

**Form of Lock-Up Agreement**

**<u>EXHIBIT C</u>**

**Form of Press Release**

## Exhibit 5.1

&nbsp;&nbsp;&nbsp;&nbsp;**EXHIBIT 5.1**

![](hemp_ex51img1.jpg)

**OPINION AND CONSENT OF BRUNSON CHANDLER & JONES, PLLC**

February 3, 2022

Hempacco Co., Inc.

9925 Airway Road

San Diego, CA, 92154

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| | |
|:---|:---|
| **Re:**  | **Hempacco Co., Inc., a Nevada corporation (the "<u>Company</u>")** |
|  | **Registration Statement on Form S-1** |

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Ladies and Gentlemen:

We refer to the Company's Registration Statement on Form S-1 initially filed by the Company with the Securities and Exchange Commission on February 3, 2022 (the "<u>Registration Statement</u>"), under the Securities Act of 1933, as amended. The Registration Statement relates to the registration of (i) up to $6,037,500 of shares (the "<u>Shares</u>") of the Company's common stock, $0.001 par value per share (the "<u>Common Stock</u>"); (ii) underwriter's warrants to purchase a number of shares of Common Stock equal to 7% of the number of the Shares sold pursuant to the Registration Statement at an exercise price of 100% of the price of the Shares offered pursuant to the Registration Statement (the "<u>Warrants</u>"); and (iii) shares of Common Stock underlying the Warrants (the "<u>Warrant Shares</u>").

<u>Assumptions</u>

In rendering the opinion expressed below, we have assumed, with your permission and without independent verification or investigation:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. That all signatures on documents we have examined in connection herewith are genuine and that all items submitted to us as original are authentic and all items submitted to us as copies conform with originals;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Except for the documents stated herein, there are no documents or agreements between the Company and/or any third parties which would expand or otherwise modify the respective rights and obligations of the parties as set forth in the documents referred to herein or which would have an effect on the opinion;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. That as to all factual matters, each of the representations and warranties contained in the documents referred to herein is true, accurate and complete in all material respects, and the opinion expressed herein is given in reliance thereon.

We have examined the following documents in connection with this matter:

1. The Company's Articles of Incorporation, as amended and restated;

2. The Company's Bylaws;

3. The Registration Statement; and

4. Unanimous Consents of the Company's Board of Directors.

We have also examined various other documents, books, records, instruments and certificates of public officials, directors, executive officers and agents of the Company, and have made such investigations as we have deemed reasonable, necessary or prudent under the circumstances. Also, in rendering this opinion, we have reviewed various statutes and judicial precedent as we have deemed relevant or necessary.

1<br>

<u>Conclusions</u>

Based upon our examination mentioned above, and relying on the statements of fact contained in the documents that we have examined, we are of the following opinions:

1. Hempacco Co., Inc. is a corporation duly organized and validly existing under the laws of the State of Nevada.

2. The Shares to be sold pursuant to the terms of the Registration Statement, when issued upon receipt by the Company of the agreed-upon consideration therefore, will be duly authorized and, upon the sale thereof, will be validly issued, fully paid and non-assessable.

3. The issuance of the Warrants has been duly authorized, and when duly executed and authenticated in accordance with their terms and issued and delivered as contemplated by the Registration Statement and the underwriting agreement by and between the Company and the representative of the underwriters, the Warrants will constitute the valid and legally binding obligations of the Company.

4. The issuance of the Warrant Shares has been duly authorized, and upon issuance in accordance with the Registration Statement and the terms of the Warrants, the obligation to issue the Warrant Shares upon exercise of the Warrants will be a binding obligation of the Company, and the Warrant Shares will be validly issued, fully paid and non-assessable.

The opinions set forth above are subject to the following exceptions, limitations and qualifications: (i) the effect of bankruptcy, insolvency, reorganization, moratorium or other similar laws now or hereafter in effect relating to or affecting the rights and remedies of creditors; (ii) the effect of general principles of equity, whether enforcement is considered in a proceeding in equity or at law, and the discretion of the court before which any proceeding therefor may be brought; and (iii) the unenforceability under certain circumstances under law or court decisions of provisions providing for the indemnification of or contribution to a party with respect to a liability where such indemnification or contribution is contrary to public policy. We expressly disclaim any obligation to update our opinions herein, regardless of whether changes in the facts or laws upon which this opinion are based come to our attention after the date hereof.

We hereby consent to the filing of this opinion as Exhibit 5.1 to the Registration Statement and the reference to our firm in the Prospectus in the Registration Statement under the caption "Legal Matters." In providing this consent, we do not thereby admit that we are within the category of persons whose consent is required under Section 7 of the Securities Act of 1933, and the rules and regulations of the Securities and Exchange Commission promulgated thereunder, including Item 509 of Regulation S-K.

Very truly yours,

*/s/ Brunson Chandler & Jones, PLLC*

**BRUNSON CHANDLER & JONES, PLLC**

2<br>

## Exhibit 10.48

**EXHIBIT 10.48**

**JOINT VENTURE AGREEMENT**

This Joint Venture Agreement of **Hempacco Paper Co., Inc**, a Delaware Corporation (the "**Company**" or **"HPC"**), is entered into as of the 2<sup>st</sup> day of October, 2022 (the "**Effective Date**") by and among the Company, **Sonora Paper Co., Inc.** a California Corporation (**"SPC"**), and **Hempacco Co., Inc.** ("**Hempacco**" or "**HPCO**") **a** Nevada Corporation.

**RECITALS**

**WHEREAS**, the Company was formed as **The Real Stuff**, **Inc.** by Hempacco as its sole shareholder as a corporation under the laws of the State of Delaware, for the purposes set forth in Section 2.05 of this Agreement, on March 10, 2021, (the "**Formation Date**"); and

**WHEREAS**, the Company filed a Certificate of Amendment of Certificate of Incorporation on July 16, 2022 whereby the Company name was changed to **Hempacco Paper Co., Inc.**

**WHEREAS**, Hempacco Co., Inc. is a member of the NASDAQ stock exchange and is subject to full SEC quarterly and annual reporting under Section 13 or 15 (d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o (d)), fled pursuant to Rule 13a-13 (17 CFR 240.13a-13) or Rule 15d-13 (17 CFR 240.15d-13). Hempacco is a wholly owned subsidiary of Green Globe International, Inc. (OTC Pink: **"GGII"**) which is obligated to filing quarterly reports under the Alternative Reporting System with the OTC Pink Open Market in accordance with the current regulations and timetable of that governing body.

**WHEREAS**, the parties wish to enter into this Agreement setting forth the terms and conditions governing the operation and management of the Company and the other matters set forth herein;

**NOW, THEREFORE**, in consideration of the mutual covenants and agreements hereinafter set forth and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

**ARTICLE I**

**Definitions**

**Section 1.01 Definitions.** Capitalized terms used herein and not otherwise defined shall have the respective meanings set forth in this Section 1.01 and when not otherwise defined shall have the meanings set forth in DCL:

"**Additional Capital Contribution**" has the meaning set forth in Section 3.02.

"**Affiliate**" means, with respect to any Person, any other Person who, directly or indirectly (including through one or more intermediaries), controls, is controlled by, or is under common control with, such Person. For purposes of this definition, "control," when used with respect to any specified Person, shall mean the power, direct or indirect, to direct or cause the direction of the management and policies of such Person, whether through ownership of voting securities or partnership or other ownership interests, by contract or otherwise; and the terms "controlling" and "controlled" shall have correlative meanings.

"**Agreement**" means this Joint Venture Agreement, as executed and as it may be amended, modified, supplemented, or restated from time to time, as provided herein.

"**Applicable Law**" means all applicable provisions of (a) constitutions, treaties, statutes, laws (including the common law), rules, regulations, decrees, ordinances, codes, proclamations, declarations, or orders of any Governmental Authority, (b) any consents or approvals of any Governmental Authority, and (c) any orders, decisions, advisory or interpretative opinions, injunctions, judgments, awards, decrees of, or agreements with, any Governmental Authority.

"**Articles of Organization**" has the meaning set forth in the Recitals.

"**Available Cash Flow**" means, for any period, the sum of gross revenue received, minus the sum of overhead and operating expenses of the Company, as well as a reasonable reserve for future operational needs as the Directors may determine to be necessary or appropriate. Notwithstanding the preceding sentence, capital contributions, loans, or proceeds from capital transactions and expenses incurred or liabilities of the Company repaid in connection with any thereof shall not be taken into account in computing Available Cash for any period.

**"Budget**" has the meaning set forth in Section 7.03.

**"Business"** means the business of manufacturing, marketing and selling of hemp wraps, hemp tubes and hemp cones and any other related products (the "Products") that the joint venture partners agree to add to their product portfolio, solely within the Territory; it being acknowledged and agreed by the Shareholders that such products may include CBD to the extent and as long as the same is under the CBD category (and not THC category) and can be legally produced and sold in the particular States of the United States of America where the Company intends to carry on business.

"**Business Day**" means a day other than a Saturday, Sunday, or other day on which commercial banks in the State of Delaware are authorized or required to close.

"**Capital Account**" has the meaning set forth in Section 3.03.

"**Capital Contribution**" means any Shareholder's contribution to the capital of the

Company either in cash or as property and equipment.

"**Code"** means the Internal Revenue Code of 1986, as amended.

"**Company**" has the meaning set forth in the Preamble.

"**Confidential Information**" has the meaning set forth in Section 13.03(a).

"**Covered Person**" has the meaning set forth in Section 9.01(a).

"**DGCL**" means the Delaware General Corporation Law, Chapter 1, Title 8 of the Laws of Delaware, as in effect at any given time.

"**Electronic Transmission**" means (a) facsimile telecommunication, (b) email, (c) posting on an electronic message board or network that the Company has designated for communications (together with a separate notice to the recipient of the posting when the transmission is given by the Company), or (d) other means of electronic communication where the recipient has consented to the use of the means of transmission (or, if the transmission is to the Company, the Company has placed in effect reasonable measures to verify that the sender is the Shareholder or Managing Shareholder purporting to send the transmission) and the communication creates a record that is capable of retention, retrieval, and review and may be rendered into clearly legible tangible form.

"**Excess Amount"** has the meaning set forth in Section 6.02(c).

"**Fair Market Value**" of any asset as of any date means the purchase price that a willing buyer having all relevant knowledge would pay a willing seller for such asset in an arm's length transaction.

"**Fiscal Year**" means the calendar year, unless the Company is required to or elects to have a taxable year other than the calendar year, in which case Fiscal Year shall be the period that conforms to its taxable year.

"**For Cause**" shall mean a Director's:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) willful failure to perform his duties (other than any such failure resulting from incapacity due to physical or mental illness) and a failure to cure the same within 10 business days of receipt of written notice thereof from another Shareholder;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) engagement in dishonesty, illegal conduct, or misconduct relating to the business of the Company, which is injurious to the Company or its Affiliates; and the same is not cured (if capable of cure) within 10 business days of receipt of written notice thereof from another Shareholder:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) embezzlement, misappropriation, or fraud, whether or not related to the Company;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) conviction of or plea of guilty or nolo contendere to a crime that constitutes a felony (or state law equivalent) or a crime that constitutes a misdemeanor involving moral turpitude;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) willful unauthorized disclosure of Confidential Information;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) breach of any material obligation under this Agreement which is not cured within 10 business days of receipt of written notice thereof from another Managing Shareholder.

"**Governmental Authority**" means any federal, state, local, or foreign government or political subdivision thereof, or any agency or instrumentality of such government or political subdivision, or any self-regulated organization or other non-governmental regulatory authority or quasi-governmental authority (to the extent that the rules, regulations, or orders of such organization or authority have the force of law), or any arbitrator, court, or tribunal of competent jurisdiction.

**"Independent Third Party"** means, with respect to any Shareholder, any Person who is not an Affiliate of such Shareholder.

"**Lien**" means any mortgage, pledge, security interest, option, right of first offer, encumbrance, or other restriction or limitation of any nature whatsoever.

"**Liquidator**" has the meaning set forth in Section 11.03(a).

"**Losses"** has the meaning set forth in Section 9.01(b).

"**Majority**" means 51% or more.

"**Directors(s)**" means, initially, Sandro Piancone and Daniel Kempton, and such other natural Persons as the Board of Directors may subsequently appoint.

"**Shareholder(s)**" means HPCO and SPC and each Person who is hereafter admitted as a Shareholder in accordance with the terms and conditions of this Agreement and DGCL, The Shareholders shall constitute "Shareholders" (as that term is defined in DGCL) of the Company.

"**Shareholders Schedule"** has the meaning set forth in Section 3.01."**Net Income**" and "**Net Loss**" mean, for each Fiscal Year or other period specified in this Agreement, an amount equal to the Company's taxable income or taxable loss, or particular items thereof, determined in accordance with Code Section 703(a) (where, for this purpose, all items of income, gain, loss, or deduction required to be stated separately pursuant to Code Section 703(a)(1) shall be included in taxable income or taxable loss).

"**Officers**" has the meaning set forth in Section 6.04.

"**Percentage Interest**" means the percentage of a Shareholder's Shares in the Company relative to the entire outstanding Shares in the Company, which is equal to the quotient of the Shares

held by a Shareholder divided by all issued and outstanding Shares of the Company held by all Shareholders, as may be adjusted from time to time by the Directors.

"**Person**" means an individual, corporation, partnership, joint venture, limited liability company, Governmental Authority, unincorporated organization, trust, association, or other entity.

"**Regulatory Allocations**" has the meaning set forth in Section 5.02(e).

"**Related Party Agreement**" means any agreement, arrangement, or understanding between the Company and any Managing Shareholder, Shareholder, or Officer, or other employee of the Company or any Affiliate of a Managing Shareholder, Shareholder, Officer, or other employee of the Company; in each case, as such agreement may be amended, modified, supplemented, or restated in accordance with the terms of this Agreement. It is agreed by the Shareholders that any and all Related Party Agreements between the Company and HCI and/or any Affiliate thereof shall provide for the pass-through of HCI's and/or such Affiliate's costs to the Company without markup.

"**Representative**" means, with respect to any Person, any and all Shareholders, officers, employees, consultants, financial advisors, counsel, accountants, and other agents of such Person.

"**Securities Act"** means the Securities Act of 1933, as amended, or any successor federal statute, and the rules and regulations thereunder, which shall be in effect at the time.

"**Shareholders**" means the Joint Venturers

"**Subsidiary"** means, with respect to any Person, any other Person of which a Majority of the outstanding shares or other equity interests having the power to vote for Shareholders or comparable managers are owned, directly or indirectly, by the first Person.

"**Supermajority**" means Shareholders holding a Percentage Interest of 75% or more.

"**Tax Amount**" of a Shareholder for a Fiscal Year means the product of (a) the Tax Rate for such Fiscal Year and (b) the Adjusted Taxable Income of the Shareholder for such Fiscal Year with respect to its Shares.

"**Tax Rate**" of a Corporate Shareholder, for any period, means the highest effective marginal combined federal, state, and local tax rate applicable to a corporation doing business in Wilmington, Delaware, taking into account (a) the character (for example, long-term or short-term capital gain, ordinary or exempt) of the applicable income and (b) if applicable the deduction under IRC Section 199A.

"**Territory**" means USA and Mexico.

"**Transfer"** means to, directly or indirectly, sell, transfer, assign, gift, pledge, encumber, hypothecate, or similarly dispose of, either voluntarily or involuntarily, by operation of law or otherwise, or to enter into any contract, option, or other arrangement or understanding with respect to the sale, transfer, assignment, gift, pledge, encumbrance, hypothecation, or similar disposition of, any Shares owned by a Person or any interest (including a beneficial interest) in any Shares owned by a Person. "**Transfer**" when used as a noun, and "**Transferred**" when used to refer to the past tense, shall have correlative meanings. "**Transferor**" and "**Transferee**" mean a Person who makes or receives a Transfer, respectively.

"**Treasury Regulations**" means the final or temporary regulations issued by the United States Department of Treasury pursuant to its authority under the Code, and any successor regulations.

"**Withholding Advances**" has the meaning set forth in Section 6.03(b).

**Section 1.02 Interpretation.** For purposes of this Agreement, (a) the words "include," "includes," and "including" shall be deemed to be followed by the words "without limitation," (b) the word "or" is not exclusive, and (c) the words "herein," "hereof," "hereby," "hereto," and "hereunder" refer to this Agreement as a whole. The definitions given for any defined terms in this Agreement shall apply equally to both the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine, and neuter forms. Unless the context otherwise requires, references herein (x) to Articles, Sections, Exhibits, and Schedules mean the Articles and Sections of and Exhibits and Schedules attached to this Agreement, (y) to an agreement, instrument, or other document means such agreement, instrument, or other document as amended, restated, supplemented, and modified from time to time to the extent permitted by the provisions thereof, and (z) to a statute or Applicable Law means such statute or Applicable Law as amended from time to time and includes any successor legislation thereto and any regulations promulgated thereunder. This Agreement shall be construed without regard to any presumption or rule requiring construction or interpretation against the party drafting an instrument or causing any instrument to be drafted. The Exhibits and Schedules referred to herein shall be construed with, and as an integral part of, this Agreement to the same extent as if they were set forth verbatim herein.

**ARTICLE II**

**Organization**

**Section 2.01 Formation.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The Company was formed on the Formation Date by HPCO, pursuant to the provisions of DGCL, upon the filing of the Articles of Organization with the Delaware Secretary of State.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) This Agreement shall constitute the "Joint Venture Agreement" (as that term is used in DGCL) of the Company. The rights, powers, duties, obligations, and liabilities of the Shareholders shall be determined pursuant to this Agreement. To the extent that the rights, powers, duties, obligations, and liabilities of any Shareholder are by reason of any provision of this Agreement in conflict with DGCL, this Agreement shall, to the extent permitted by DGCL, control.

**Section 2.02 Name.** The name of the Company is "Hempacco Paper Co., Inc." or such other name or names as may be designated by the Directors; The Company may conduct business under any assumed or fictitious name deemed desirable by the Directors.

**Section 2.03 Principal Office.** The principal office of the Company in the United States is located at 8700 E. Pinnacle Peak Rd. Suite 210, Scottsdale, AZ 96255, or such other place as may from time to time be determined by the Directors. The Directors shall give prompt notice of any such change to each of the Shareholders.

**Section 2.04 Office and Agent for Service of Process.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The office for service of process on the Company in the State of Delaware shall be the office of the initial agent named in the Articles of Organization or such other office (which need not be a place of business of the Company) as the Directors may designate from time to time in the manner provided by DGCL and Applicable Law.

**Section 2.05 Purpose; Powers.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The purpose of the Company is to engage in the Business and any other lawful act or activity for which limited liability companies may be formed under DGCL and to engage in any and all activities necessary or incidental thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Company shall have all the powers necessary or convenient to carry out the purposes for which it is formed, including the powers granted by DGCL.

**Section 2.06 Term.** The term of the Company commenced on the date the Articles of Organization were filed with the Delaware Secretary of State and shall continue in existence perpetually until the Company is dissolved in accordance with the provisions of this Agreement or as provided by Applicable Law.

**ARTICLE III**

**Capital Contributions; Capital Accounts**

**Section 3.01 Initial Capital Contributions.** Contemporaneously with the execution of this Agreement, each Shareholder has made an initial Capital Contribution and is deemed to own the Percentage Interest set forth opposite such Shareholder's name on **Schedule A** attached hereto and incorporated by reference herein (the "**Shareholders Schedule**"). The Directors shall update the Shareholders Schedule upon the issuance or Transfer of any Shares to any new or existing Shareholder in accordance with this Agreement.

**Section 3.02 Additional Capital Contributions.** No Shareholder shall be required to make any additional Capital Contributions to the Company. However, a Shareholder may make an additional Capital Contribution (an "**Additional Capital Contribution**") at any time with the written consent of the Directors and such Shareholder. To the extent that a Shareholder makes such an approved Additional Capital Contribution to the Company, the Directors shall revise the Shareholders Schedule to reflect an increase in the Percentage Interest of the contributing Shareholder, and the corresponding decrease in the Percentage Interest of each non-contributing Shareholder, that fairly and equitably reflects the value of the contributing Shareholder's Additional Capital Contribution in relation to the aggregate amount of all Capital Contributions made by the Shareholders.

**Section 3.03 Maintenance of Capital Accounts.** The Company shall establish and maintain the customary capital accounts required under GAAP for a corporation, which include but are not limited to:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) Issued Common Shares

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) Issued Preference Shares

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) Additional Paid-in Capital

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d) Retained Earnings

The company's financial statements will include a "Statement of Stockholders Equity" which will provide full details of the transactions affecting these capital accounts on a quarterly basis.

**Section 3.06 No Withdrawals From Capital Accounts.** No Shareholder shall be entitled to withdraw any part of its Capital Account or to receive any distribution from the Company, except as otherwise provided in this Agreement. No Shareholder, including the Directors, shall receive any interest, salary, or drawing with respect to its Capital Contributions or its Capital Account, except as otherwise provided in this Agreement. The Capital Accounts are maintained for the sole purpose of allocating items of income, gain, loss, and deduction among the Shareholders and shall have no effect on the amount of any distributions to any Shareholders, in liquidation or otherwise.

**Section 3.07 Treatment of Loans From Shareholders.** Loans by any Shareholder to the Company shall not be considered Capital Contributions and shall not affect the maintenance of such Shareholder's Capital Account, other than to the extent provided in Section 3.03(a)(iii), if applicable.

**ARTICLE IV**

**Shareholders**

**Section 4.01 Admission of New Shareholders.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) New Shareholders, having been approved by the Directors, may be admitted from time to time (i) in connection with the issuance of Shares by the Company, subject to compliance with the provisions of Section 7.02(b) and Section 8.01(b), and (ii) in connection with a Transfer of Shares, subject to compliance with the provisions of ARTICLE VIII, and in either case, following compliance with the provisions of Section 4.01(b).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In order for any Person not already a Shareholder of the Company to be admitted as a Shareholder, whether pursuant to an issuance or Transfer of Shares, such Person shall have delivered to the Company an executed written undertaking substantially in the form of the Joinder Agreement. Upon the amendment of the Shareholders Schedule by the Directors and the satisfaction of all other applicable conditions, including, if a condition, the receipt by the Company of payment for the issuance of Shares, such Person shall be admitted as a Shareholder and deemed listed as such on the books and records of the Company. The Directors shall also adjust the Capital Accounts of the Shareholders as necessary in accordance with Section 3.03.

**Section 4.02 No Personal Liability.** Except as otherwise provided by DGCL, by Applicable Law, or expressly in this Agreement, no Director or Shareholder will be obligated personally for any debt, obligation, or liability of the Company or other Shareholders, whether arising in contract, tort, or otherwise, solely by reason of being or acting as a Shareholder. Except as otherwise provided by DGCL, by Applicable Law, or expressly in this Agreement, no Director will be obligated personally for any debt, obligation, or liability of the Company, whether arising in contract, tort, or otherwise, solely by reason of being or acting as a Director and/or Shareholder.

**Section 4.03 Dissociation.** No Shareholder shall have the ability to dissociate or withdraw as a Shareholder before the dissolution and winding up of the Company, and any such dissociation or withdrawal or attempted dissociation or withdrawal by a Shareholder before the dissolution or winding up of the Company shall be null and void *ab initio*. As soon as any Person who is a Shareholder ceases to hold any Shares, such Person shall no longer be a Shareholder.

**Section 4.04 No Interest in Company Property.** No real or personal property of the Company shall be deemed to be owned by any Shareholder individually, but shall be owned by, and title shall be vested solely in, the Company. Without limiting the foregoing, each Shareholder hereby irrevocably waives during the term of the Company any right that such Shareholder may have to maintain any action for partition with respect to the property of the Company.

**Section 4.05 Certification of Shares.** The Directors will not issue certificates to the Shareholders but shall record or cause to be recorded all issuances, exchanges, and other transactions in Shares involving the Shareholders in a ledger maintained as part of the books and records of the Company.

**Section 4.06 Meetings.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Meetings of the Shareholders regarding matters required to be submitted to the Shareholders under this Agreement may be called by (i) any of the Directors, or (ii) any Shareholder holding a Percentage Interest of 10% or more.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Written notice stating the place, date, and time of the meeting, the means of electronic video screen communication or Electronic Transmission by and to the Company, if any, and the general nature of the business to be transacted at the meeting, shall be delivered not fewer than 5 days and not more than 60 days before the date of the meeting to each Shareholder, by or at the direction of the Directors or the Shareholder(s) calling the meeting, as the case may be. The business to be conducted at such meeting shall be limited to the purposes described in the notice. The Shareholders may hold meetings at the Company's principal office or at such other place, within or outside the State of Delaware, as the Directors or the Shareholder(s) calling the meeting may designate in the notice for such meeting.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Any Shareholder may participate in a meeting of the Shareholders (i) using conference telephone or electronic video screen communication, if all Persons participating in the meeting can talk to and hear each other or (ii) by Electronic Transmission by and to the Company if the Company (1) implements reasonable measures to provide Shareholders, in person or by proxy, a reasonable opportunity to participate and vote, including an opportunity to read or hear the meeting's proceedings substantially concurrently with the proceedings and (2) maintains a record of votes or other action taken by the Shareholders. Participation in a meeting by such means shall constitute presence in person at such meeting.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) On any matter that is to be voted on by the Shareholders, a Shareholder may vote in person or by proxy, and such proxy may be granted in writing signed by such Shareholder, using Electronic Transmission authorized by such Shareholder, or as otherwise permitted by Applicable Law. Every proxy shall be revocable in the discretion of the Shareholder executing it unless otherwise provided in such proxy; provided, that such right to revocation shall not invalidate or otherwise affect actions taken under such proxy before such revocation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Attendance of a Shareholder at any meeting shall constitute a waiver of notice of such meeting, except where a Shareholder attends a meeting for the express purpose of objecting to the transaction of any business on the ground that the meeting is not lawfully called or convened. Attendance of a Shareholder at a meeting is not a waiver of the Shareholder's right to object to consideration of matters required to be described in the notice for the meeting, if the Shareholder expressly objects to such consideration at the meeting.

**Section 4.07 Action Without a Meeting.** Notwithstanding the provisions of Section 4.06, any matter that is to be voted on by the Shareholders may be taken without a meeting by written consent signed and delivered (including by Electronic Transmission) to the Company by the Shareholders holding the requisite Percentage Interest for such matters had a meeting been taken. A record shall be maintained in the Company's books and records by the Directors of each such action taken by written consent of a Shareholder or the Shareholders.

**Section 4.08 Shareholder Services**.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) For so long as HPCO shall remain a Shareholder of the Company, HPCO shall, without limitation, perform or cause to be performed the following services for and on behalf of the Company and without additional compensation:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Final product manufacturing and packaging in the Company's existing manufacturing facilities in Tijuana, Mexico and San Diego, CA.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) CRM management.

iii) Product Development and strategies for increased profitability.

iv) Direct to consumer fulfillment, and wholesale and retail distribution.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) All SEC and OTC filing requirements and PCAOB auditing requirements.

Including full quarterly accounting to GAAP standards.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) Inventory Management

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) Staff training & mentoring.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii) Trade show space & marketing for USA & Mexico

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ix) Kiosk Sales & placement in conjunction with HempBox Vending, Inc.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) For so long as SPC shall remain a Shareholder of the Company, SPC shall, without limitation, perform or cause to be performed the following services for and on behalf of the Company and without additional compensation:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Provide access to SPC's patented and patent pending technologies upon payment of

Royalties, the amount and frequency of which will be subject to a separate agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Assist HPCO with negotiations for new distribution contracts.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Assist HPCO with managing Partnerships with master distributors and retailers.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Assist HPCO in developing new strategies to expand distribution and increase profits.

**Section 4.09 Joint Roles of the Parties.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) The Parties shall work together to establish new products and new services.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) The Parties shall work together to ensure that the business of HPC is run efficiently with a maximization of the profits to be generated by HPC.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) With regard to products produced within the Joint Venture, the Parties agree not to undercut, undermine, or in any way interfere with each other's contracts, agreements, or relationships with their respective clients. Any agreement, relationship or contract between either party and their client that is fulfilled by the Joint Venture will be recognize and honored by the other party, without interference.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) HPCO and SPC shall individually have entered into a manufacturing agreement with HPC for the production of products to be sold by HPCO and SPC directly to their existing customers. The terms and conditions of said manufacturing agreements shall be mutually agreeable to the Parties.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) Any new Joint Venture Agreements between the Company and third parties must be approved by the Boards of Directors of all Parties to this agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) The Parties hereto shall work together to draft a mutually acceptable and all-encompassing Business Plan for HPC.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) The Parties hereto agree to enter into all necessary collateral agreements to establish HPC and the Joint Venture contemplated by this agreement.

**Section 4.10 Other Economic Terms**.

On the execution date of this Agreement, the Company will issue to SPC an number of common shares of the Company equal to 20% of the current issued and outstanding shares, as detailed on the attached Exhibit A.

**ARTICLE V**

**Allocations**

**Section 5.01 Distributions of Net Income and Net Loss to shareholders.** For each Fiscal Year (or portion thereof), Net Income and Net Loss of the Company shall be transferred to the Retained Earnings account of the Company.

After considering further distributions for Federal & State Income Taxes, and after considering the balance of working capital that should be retained in the business, then the Directors will decide on the amount, if any, of dividends that will be distributed to shareholders in accordance with their respective percentage interests.

**ARTICLE VI**

**Section 6.01 Management of the Company.** The Company shall be managed by a Board of Directors, which will be comprised of up to 5 members. Each of HPCO and SPC will have the right to appoint board members in a number equal to their percentage ownership of the Company. Notwithstanding the foregoing, the parties agree that the initial directors of HPC will be Sandro Piancone and Daniel Kempton. HPCO will have the right to appoint up to 3 additional directors of its choosing.

Subject to any other provisions to the contrary in this Agreement, the Directors shall have full and complete discretion to manage and control the business, property, activities, and affairs of the Company, to make all decisions affecting the business, property, activities, and affairs of the Company, and to take all such actions as they deem necessary or appropriate to accomplish the purposes of the Company set forth in Section 2.05. The actions of the Directors taken in accordance with the provisions of this Agreement shall bind the Company.

**Section 6.02 Actions Requiring Supermajority Approval of Shareholders.** HPCO being the owner of a supermajority of the Company's common shares, shall have the right to enter into any of the following commitment to:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) amend, modify, or waive any provisions of the Articles of Organization;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) issue additional Shares or other debt or equity instruments or, except in connection with a Transfer of Shares that complies with the applicable provisions of ARTICLE VIII and Section 4.01(b), admit additional Shareholders to the Company;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) settle any lawsuit, action, dispute, or other proceeding or otherwise assume any liability or agree to the provision of any equitable relief by the Company other than settlements which individually are for less than $10,000; provided, that if the lawsuit, claim, dispute, or other proceeding involves an indemnification claim pursuant to ARTICLE IX, such settlement shall also be approved in accordance with the terms of Section 9.01(c);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) create any incentive equity plan for employees and/or independent contractors;

**Section 6.03 Budgets.** At least sixty (60) days before the beginning of each Fiscal Year, the Company shall prepare and submit to the Directors for approval an annual business plan and budget for the Company through the Fiscal Year ending December 31 (a "**Budget**").

Each Budget shall include detailed capital and operating expense budgets, cash flow projections (which shall include amounts and due dates of all projected calls for Additional Capital Contributions, if any) and profit and loss projections. The Directors shall operate the Company in accordance with the approved Budgets.

**Section 6.04 Officers.** The Directors may appoint individuals as officers of the Company (the "**Officers**") as the Directors deem necessary or desirable to carry on the business of the Company and the Directors may delegate to such Officers such power and authority as they deem advisable. No Officer need be a Shareholder of the Company. Any individual may hold two or more offices of the Company. Each Officer shall hold office until his or her successor is designated by the Directors or until his or her earlier death, resignation, or removal. Any Officer may resign at any time on written notice to the Directors. Any Officer may be removed by the Directors with or without cause at any time. A vacancy in any office occurring because of death, resignation, removal, or otherwise, may, but need not, be filled by the Directors.

**Section 6.05 Compensation.** The Directors shall not be compensated for their services as Directors, but the Company shall reimburse the Directors upon written demand for any and all ordinary, necessary, and direct expenses incurred by the Directors on behalf of the Company in carrying out the Company's business activities. All reimbursements for expenses shall be reasonable in amount, previously approved by the Shareholders, and shall not exceed amounts set forth in the Budget for any Fiscal Year.

**Section 6.06 Removal of Directors.** Any Director may be removed by the shareholder who appointed him.

**Section 6.07 Resignation of a Director.** A Director may resign at any time by giving at least 30 days' prior written notice to the Company. Any such resignation shall be effective on receipt thereof unless it is specified to be effective at some other time or on the occurrence of some other event. The Company's acceptance of a resignation shall not be necessary to make it effective. The resignation of a Director shall not affect its or its Affiliate's rights as a Shareholder (if applicable) and shall not constitute a dissociation of any Shareholder. Following such resignation, a successor Director shall be appointed as provided in Section 7.06 above.

**Section 6.08 Exclusivity.** Any Shareholder and/or any Affiliate of a Shareholder may engage in or possess an interest in other business ventures (including without limitation in cannabidiol and/or cannabis product related ventures) within the Territory, unconnected with the Company and independently or with others. The Company shall not have any rights in or to any such independent venture or the income or profits therefrom by virtue of this Agreement. Notwithstanding the foregoing, no Shareholder nor any Affiliate of a Shareholder shall own, operate, have an interest in or render services for any business (other than the Company) within the Territory that is involved in the sale of hemp smokable products and which is directly competitive with the Business.

**Section 6.08 No Personal Liability.** Except as otherwise provided in DGCL, which gives protection against personal liability for company actions and expenditures provided that Directors and Officers make informed, independent decisions in the performance of their duties no Director nor any Shareholder will be obligated personally for any debt, obligation, or liability of the Company, whether arising in contract, tort, or otherwise, solely by reason of being or acting as a Director or Shareholder.

**ARTICLE VII**

**Transfer**

**Section 7.01 General Restrictions on Transfer.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) No Shareholder shall Transfer all or any portion of its Shares in the Company without written consent of the Directors. No Transfer of Shares to a Person not already a Shareholder of the Company shall be deemed completed until the prospective Transferee is admitted as a Shareholder of the Company in accordance with Section 4.01(b) hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each party to this agreement will have the first right of refusal to purchase from the other joint venture partner, the remaining percentage of the shares of the company not already owned by the joint venture partner.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Notwithstanding any other provision of this Agreement, each Shareholder agrees that it will not Transfer all or any portion of its Shares in the Company, and the Company agrees that it shall not issue any additional shares:

**Section 7.02 Involuntary Transfers.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) On the date of the occurrence of an Involuntary Transfer ("**Transfer Event**"), the Involuntary Transferee of such Shares shall thereupon become an Economic Interest Holder and shall not become, a Shareholder, unless admitted as a Shareholder pursuant to Section 4.01(b). On a Transfer Event, the Involuntary Transferee shall be deemed to have offered for sale, without any further action required, the entire Shares subject to the Involuntary Transfer ("**Affected Shares**").

First, the Company shall have 30 days from said date within which to elect to purchase some or all of the Affected Shares, and if the Company elects not to do so within said 30-day period, then the remaining Shareholders shall have 30 days to elect to purchase their pro-rata share (based on their current Percentage Interest) of the Affected Shares. In the event that the exercise of any such election must be approved in any legal proceeding and such approval does not occur within the time periods set forth in this Section, such time periods shall be extended and tolled until fifteen (15) days after the date of any such approvals in order to permit the orderly exercise of such elections. The purchase price for such Affected Shares shall be Fair Market Value as of the Transfer Event.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In the event that the Company and the remaining Shareholders elect not to purchase some or all of the Affected Shares in accordance with this Section 8.02(a), the Involuntary Transferee of the portion of such Shares that is not purchased shall hold such portion of such Shares solely as an Economic Interest holder and shall be entitled to the Economic Interest derived from such Shares, but not to any other rights of ownership of such Shares.

**Section 7.03 Determination of Fair Market Value.** Each of the selling and purchasing parties shall use best efforts to determine the Fair Market Value of the Shares offered for sale under Section 7.02. If the parties are unable to agree thereon, then each party shall appoint an appraiser within 30 days of purchaser's election to purchase such Shares ("**Appointment Period**"). The two appraisers shall elect a third appraiser within fifteen (15) days of the last day of the Appointment Period who shall determine the Fair Market Value of the Shares being purchased, and the average of the two appraisals which are nearest to each other will be the Fair Market Value of the Shares.

The costs of each of the first two appraisers will be paid by the Shareholder who appointed the appraiser, and the costs of the third appraiser will be paid by the Company. Said determination shall be final and binding on the parties. All appraisers selected will be qualified and will be individuals with the "Accredited in Business Valuation" credential of the American Institute of Certified Public Accountants or the "Accredited Senior Appraiser" designation of the American Society of Appraisers.

**ARTICLE VIII**

**Indemnification**

**Section 8.01 Covered Persons.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**(a) Covered Persons.** As used herein, the term "**Covered Person**" shall mean (i) each Shareholder, (ii) each Director, (iii) each Officer, Shareholder, Manager, Affiliate, employee, agent, or Representative of each Shareholder and of each Director, and each of their respective Affiliates, and (iv) each Officer, employee, agent, or Representative of the Company, and specifically Eli Ben Haroosh and Asher Holzer and their respective companies.

&nbsp;&nbsp;&nbsp;&nbsp;**(b) Indemnification.** To the fullest extent permitted under DGCL (after waiving all DGCL restrictions on indemnification other than those which cannot be eliminated or modified under DGCL), as the same now exists or may hereafter be amended, substituted, or replaced (but, in the case of any such amendment, substitution, or replacement, only to the extent that such amendment, substitution, or replacement permits the Company to provide broader indemnification rights than DGCL permitted the Company to provide before such amendment, substitution, or replacement), the Company shall indemnify, hold harmless, defend, pay, and reimburse any Covered Person against any and all losses, claims, damages, judgments, fines, or liabilities, including reasonable legal fees or other expenses incurred in investigating or defending against such losses, claims, damages, judgments, fines, or liabilities, and any amounts expended in settlement of any claims (collectively, "**Losses**") to which such Covered Person may become subject by reason of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) any act or omission or alleged act or omission performed or omitted to be performed on behalf of the Company, any Shareholder, any Director, or any of their respective direct or indirect Subsidiaries in connection with the business of the Company; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) such Covered Person being or acting in connection with the business of the Company as a Shareholder, Director, Affiliate, Director, Shareholder, officer, employee, agent, or Representative of the Company, any Shareholder, any Director, or any of their respective Affiliates, or such Covered Person serving or having served at the request of the Company as a Shareholder, Director, officer, employee, agent, or Representative of any Person including the Company; provided, that such Loss did not arise from (1) the Covered Person's conduct involving bad faith, willful or intentional misconduct, or a knowing violation of law, (2) a transaction from which such Covered Person derived an improper personal benefit, (3) a circumstance under which the liability provisions for improper distributions of DGCL are applicable, or (4) a breach of such Covered Person's fiduciary duties or obligations under DGCL.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) **Control of Defense.** On a Covered Person's discovery of any claim, lawsuit, or other proceeding relating to any Losses for which such Covered Person may be indemnified pursuant to this Section 8.01, the Covered Person shall give prompt written notice to the Company of such claim, lawsuit, or proceeding; provided, that the failure of the Covered Person to provide such notice shall not relieve the Company of any indemnification obligation under this Section 9.01, unless the Company shall have been materially prejudiced thereby. Subject to the approval of the holders of the Majority of the Shares held by the disinterested Shareholders, the Company shall be entitled to participate in or assume the defense of any such claim, lawsuit, or proceeding at its own expense. After notice from the Company to the Covered Person of its election to assume the defense of any such claim, lawsuit, or proceeding, the Company shall not be liable to the Covered Person under this Agreement or otherwise for any legal or other expenses subsequently incurred by the Covered Person in connection with investigating, preparing to defend, or defending any such claim, lawsuit, or other proceeding. If the Company does not elect (or fails to elect) to assume the defense of any such claim, lawsuit, or proceeding, the Covered Person shall have the right to assume the defense of such claim, lawsuit, or proceeding as it deems appropriate, but it shall not settle any such claim, lawsuit, or proceeding without the consent of the holders of the Majority of the Shares held by the disinterested Shareholders (which consent shall not be unreasonably withheld, conditioned, or delayed).

**Reimbursement.** The Company shall promptly reimburse (or advance to the extent reasonably required) each Covered Person for reasonable legal or other expenses (as incurred) of such Covered Person in connection with investigating, preparing to defend, or defending any claim, lawsuit, or other proceeding relating to any Losses for which such Covered Person may be indemnified pursuant to this Section 8.01; provided, that if it is finally judicially determined that such Covered Person is not entitled to the indemnification provided by this Section 9.01, then such Covered Person shall promptly reimburse the Company for any reimbursed or advanced expenses.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) **Entitlement to Indemnity.** The indemnification provided by this Section 8.01 shall not be deemed exclusive of any other rights to indemnification to which those seeking indemnification may be entitled under any agreement or otherwise. The provisions of this Section 8.01 shall continue to afford protection to each Covered Person regardless of whether such Covered Person remains in the position or capacity pursuant to which such Covered Person became entitled to indemnification under this Section 8.01 and shall inure to the benefit of the executors, administrators, legatees, and distributees of such Covered Person.

**Insurance.** To the extent available on commercially reasonable terms, the Company may purchase, at its expense, insurance (i) to cover Losses covered by the indemnification provisions contained in this ARTICLE IX, and (ii) to otherwise cover Losses for any breach or alleged breach by any Covered Person of such Covered Person's duties whether or not covered by the foregoing indemnifications, in each case, in such amount and with such deductibles as the Directors may reasonably determine; provided, that the failure to obtain such insurance shall not affect the right to indemnification of any Covered Person under the indemnification provisions contained in this ARTICLE IX, including the right to be reimbursed or advanced expenses or otherwise indemnified for Losses hereunder. If any Covered Person recovers any amounts in respect of any Losses from any insurance coverage, then such Covered Person shall, to the extent that such recovery is duplicative, reimburse the Company for any amounts previously paid to such Covered Person by the Company in respect of such Losses.

Funding of Indemnification Obligation. Notwithstanding anything contained herein to the contrary, any indemnity by the Company relating to the matters covered in this Section 8.01 shall be provided out of and to the extent of Company assets only, and no Shareholder (unless such Shareholder otherwise agrees in writing) shall have personal liability on account thereof or shall be required to make additional Capital Contributions to help satisfy such indemnity by the Company.

Savings Clause. If this Section 8.01 or any portion hereof shall be invalidated on any ground by any court of competent jurisdiction, then the Company shall nevertheless indemnify and hold harmless each Covered Person pursuant to this Section 8.01 to the fullest extent permitted by any applicable portion of this Section 8.01 that shall not have been invalidated and to the fullest extent permitted by Applicable Law.

Amendment. The provisions of this Section 8.01 shall be a contract between the Company, on the one hand, and each Covered Person who served in such capacity at any time while this Section 8.01 is in effect, on the other hand, pursuant to which the Company and each such Covered Person intend to be legally bound. No amendment, modification, or repeal of this Section 8.01 that adversely affects the rights of a Covered Person to indemnification for Losses incurred or relating to a state of facts existing before such amendment, modification, or repeal shall apply in such a way as to eliminate or reduce such Covered Person's entitlement to indemnification for such Losses without the Covered Person's prior written consent.

**Section 8.02 Survival.** The provisions of this ARTICLE IX shall survive the dissolution, liquidation, winding up, and termination of the Company.

**ARTICLE IX**

**Accounting; Inspection Rights; Tax Matters**

**Section 9.01 Financial Statements.** The Company shall furnish to each Shareholder the following reports:

**Annual Financial Statements.** As soon as available, and in any event within 90 days after the end of each Fiscal Year, unaudited balance sheets of the Company as of the end of each such Fiscal Year and unaudited statements of income, cash flows, and Shareholders' equity for such Fiscal Year. These financial statements will be prepared on an accrual basis and in accordance with Generally Accepted Accounting Principles ("GAAP") in the United States.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) **Quarterly Financial Statements.** As soon as available, and in any event within 45 days after the end of each quarterly accounting period in each Fiscal Year (other than the last fiscal quarter of the Fiscal Year), unaudited balance sheets of the Company as of the end of each such fiscal quarter and for the current Fiscal Year to date and unaudited statements of income, cash flows, and Shareholders' equity for such fiscal quarter and for the current Fiscal Year to date.

**Section 9.02 Inspection Rights.** Upon reasonable notice from a Shareholder, the Company shall afford the Shareholder and each of its respective Representatives access during normal business hours to (i) the Company's properties, offices, and other facilities, (ii) the corporate, financial, and similar records, reports, and documents of the Company, including, without limitation, all books and records, minutes of proceedings, internal management documents, reports of operations, reports of adverse developments, copies of any management letters, and communications with Shareholders (including the Directors), and permit the Shareholder or and each of its respective Representatives to examine such documents and make copies thereof, and (iii) any Officers, senior employees, and public accountants of the Company, and afford the Shareholder and each of its respective Representatives the opportunity to discuss and advise on the affairs, finances, and accounts of the Company with such Officers, senior employees, and public accountants (and the Company hereby authorizes said accountants and other Persons to discuss with such Shareholder and its Representatives such affairs, finances, and accounts); in each case, to the extent such information is for a purpose reasonably related to the Shareholder's interest as a Shareholder.

**Section 9.03 Income Tax Status.** It is the intent of the Company and the Shareholders that the Company shall be treated as "C" corporation for U.S., federal, state, and local income tax purposes.

**Section 9.04 Tax Returns.** At the expense of the Company and subject to Section 4.08(a)(v) above, the Directors (or any Officer that it may designate pursuant to Section 7.04) shall endeavor to cause the preparation and timely filing (including extensions) of all tax returns required to be filed by the Company pursuant to the Code as well as all other required tax returns in each jurisdiction in which the Company owns property or does business.

As long as HPCO retains an ownership interest in excess of 75% of the Company, the Company may elect to file as a consolidated entity under the GGII group tax return.

**Section 9.05 Company Funds.** All funds of the Company shall be deposited in its name, or in such name as may be designated by the Directors, in such checking, savings, or other accounts, or held in its name in the form of such other investments as shall be designated by the Directors. The funds of the Company shall not be commingled with the funds of any other Person. All withdrawals of such deposits or liquidations of such investments by the Company shall be made exclusively on the signature or signatures of such Officer or Officers as the Directors may designate.

**ARTICLE X**

**Dissolution and Liquidation**

**Section 10.01 Events of Dissolution.** The Company shall be dissolved and its affairs wound up only on the occurrence of any of the following events:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) An election to dissolve the Company made by the Directors;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The sale, exchange, involuntary conversion, or other disposition or Transfer of all or substantially all the assets of the Company;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Passage of 90 consecutive days during which the Company has no Shareholders; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The entry of a decree of judicial dissolution under DGCL.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) The reduction of sales and/or net profits below a pre-determined level agreed upon, in writing, by both Directors prior to the commencement of business. Measurement will be on a cumulative basis but in any event such determination will not be made within the first 12 months of operations.

**Section 10.02 Effectiveness of Dissolution.** Dissolution of the Company shall be effective on the day on which the event described in Section 11.01 occurs. On the occurrence of an event described in Section 11.01, the Liquidator (or, in the case of a dissolution pursuant to Section 11.01(d), the Persons conducting the winding up of the Company's affairs pursuant to DGCL) shall commence the wind up of the Company and the distribution of the assets of the Company as provided in Section 11.03 and shall thereafter file articles of dissolution with the Delaware Secretary of State pursuant to DGCL.

**Section 10.03 Liquidation.** If the Company is dissolved pursuant to Section 10.01, the Company shall be liquidated and its business and affairs wound up in accordance with DGCL and the following provisions:

The Directors shall act as liquidator to wind up the Company (the "Liquidator"). The Liquidator shall have full power and authority to sell, assign, and encumber any or all of the Company's assets and to wind up and liquidate the affairs of the Company in an orderly and business-like manner. The Liquidator will sign off any necessary document and make any necessary actions to perfect the transfer of the exclusive rights to use such names to SIL for no costs.

Notice of Liquidation. The Liquidator (or other Persons winding up the affairs of the Company pursuant to Section 10.02) shall give written notice of the commencement of winding up by mail to all known creditors and claimants whose addresses appear on the records of the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) **Accounting.** As promptly as possible after dissolution and again after final liquidation, the Liquidator shall cause a proper accounting to be made by a recognized firm of certified public accountants of the Company's assets, liabilities, and operations through the last day of the calendar month in which the dissolution occurs or the final liquidation is completed, as applicable.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) **Distribution of Proceeds.** The Liquidator shall liquidate the assets of the Company and distribute the proceeds of such liquidation in the following order of priority, unless otherwise required by mandatory provisions of Applicable Law:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) First, to the payment of all of the Company's known debts and liabilities (including any debts and liabilities to Shareholders who are creditors, if applicable) and the expenses of liquidation (including sales commissions incident to any sales of assets of the Company);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Second, to the establishment of and additions to reserves that are determined by the Liquidator to be reasonably necessary for any contingent unknown liabilities or obligations of the Company; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Third, to the Shareholders, on a pro-rata basis, in accordance with the positive balances in their respective Capital Accounts, as determined after considering all Capital Account adjustments for the taxable year of the Company during which the liquidation of the Company occurs.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) **Discretion of Liquidator.** Notwithstanding the provisions of Section 11.03(d) that require the liquidation of the assets of the Company, but subject to the order of priorities set forth in Section 11.03(d), if on dissolution of the Company the Liquidator reasonably determines that an immediate sale of part or all of the Company's assets would be impractical or could cause undue loss to the Shareholders, the Liquidator may defer the liquidation of any assets except those necessary to satisfy Company liabilities and reserves, and may distribute to the Shareholders, in lieu of cash, as tenants in common and in accordance with the provisions of Section 11.03(d), undivided interests in such Company assets as the Liquidator deems not suitable for liquidation. Any such distribution in kind shall be subject to such conditions relating to the disposition and management of such properties as the Liquidator deems reasonable and equitable and to any agreements governing the operating of such properties at such time. For purposes of any such distribution, any property to be distributed will be valued at its Fair Market Value.

**Section 10.04 Cancellation of Foreign Qualifications.** On completion of the distribution of the assets of the Company as provided in Section 11.03(d) hereof, the Liquidator shall file articles of dissolution with the Delaware Secretary of State and shall cause the cancellation of all qualifications and registrations of the Company as a foreign limited liability company in jurisdictions other than the State of Delaware and shall take such other actions as may be necessary to terminate the Company.

**Section 10.05 Survival of Rights, Duties, and Obligations.** Dissolution, liquidation, winding up, or termination of the Company for any reason shall not release any party from any Loss that at the time of such dissolution, liquidation, winding up, or termination already had accrued to any other party or thereafter may accrue in respect of any act or omission before such dissolution, liquidation, winding up, or termination. For the avoidance of doubt, none of the foregoing shall replace, diminish, or otherwise adversely affect any Shareholder's right to indemnification pursuant to ARTICLE IX.

**Section 10.06 Recourse for Claims.** Each Shareholder shall look solely to the assets of the Company for all distributions with respect to the Company, and shall have no recourse therefor (upon dissolution or otherwise) against the Liquidator or any other Shareholder.

**ARTICLE XI**

**Miscellaneous**

**Section 11.01 Expenses.** Except as otherwise expressly provided herein, all costs and expenses, including fees and disbursements of counsel, financial advisors, and accountants, incurred in connection with the preparation and execution of this Agreement, or any amendment or waiver hereof, and the transactions contemplated hereby shall be paid by the party incurring such costs and expenses.

**Section 11.02 Further Assurances.** In connection with this Agreement and the transactions contemplated hereby, the Company and each Shareholder hereby agrees, at the request of the Company or any other Shareholder, to execute and deliver such additional documents, instruments, conveyances, and assurances and to take such further actions as may be required to carry out the provisions hereof and give effect to the transactions contemplated hereby and to operate the Business in accordance with Applicable Law.

**Section 11.03 Confidentiality.**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Each Shareholder acknowledges that during the term of this Agreement, it will have access to and become acquainted with trade secrets, proprietary information, and confidential information belonging to the Company and its Affiliates that are not generally known to the public, including, but not limited to, customer information, manufacturing information, regulatory information, financial statements, vendor information, employee information and other information provided pursuant to this Agreement, operating practices and methods, expansion plans, strategic plans, marketing plans, contracts, customer lists, or other business documents that the Company treats as confidential, in any format whatsoever (including oral, written, electronic, or any other form or medium) (collectively, "**Confidential Information**"). In addition, each Shareholder acknowledges that (i) the Company has invested, and continues to invest, substantial time, expense, and specialized knowledge in developing its Confidential Information, (ii) the Confidential Information provides the Company with a competitive advantage over others in the marketplace, and (iii) the Company would be irreparably harmed if the Confidential Information were disclosed to competitors or made available to the public. Without limiting the applicability of any other agreement to which any Shareholder is subject, no Shareholder shall, directly or indirectly, disclose or use (other than solely for the purposes of such Shareholder monitoring and analyzing its investment in the Company and carrying out its obligations to the Company) including, without limitation, use for personal, commercial, or proprietary advantage or profit, either during its association with the Company or thereafter, any Confidential Information of which such Shareholder is or becomes aware. Each Shareholder in possession of Confidential Information shall take all appropriate steps to safeguard such information and to protect it against disclosure, misuse, espionage, loss, and theft.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Nothing contained in Section 12.03(a) shall prevent any Shareholder from disclosing Confidential Information (i) on the order of any court or administrative agency, (ii) on the request or demand of any regulatory agency or authority having jurisdiction over such Shareholder, (iii) to the extent compelled by legal process or required or requested pursuant to subpoena, interrogatories, or other discovery requests, (iv) to the extent necessary in connection with the exercise of any remedy hereunder, (v) to any other Shareholder, the Directors, or the Company, or (vi) to such Shareholder's Representatives who, in the reasonable judgment of such Shareholder, need to know such Confidential Information and agree to abide by the provisions of this Section 12.03 as if a Shareholder; provided, that in the case of clause (i), (ii), or (iii), such Shareholder shall notify the Company and other Shareholders of the proposed disclosure as far in advance of such disclosure as practicable (but in no event make any such disclosure before notifying the Company and other Shareholders) and use reasonable efforts to ensure that any Confidential Information so disclosed is accorded confidential treatment satisfactory to the Company, when and if available.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The restrictions of Section 12.03(a) shall not apply to Confidential Information that (i) is or becomes generally available to the public other than as a result of a disclosure by a Shareholder in violation of this Agreement, (ii) is or has been independently developed or conceived by such Shareholder without use of Confidential Information, or (iii) becomes available to such Shareholder or any of its Representatives on a non-confidential basis from a source other than the Company, the other Shareholders, or any of their respective Representatives; provided, that such source is not known by the receiving Shareholder to be bound by a confidentiality agreement regarding the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The obligations of each Shareholder under this Section 12.03 shall survive (i) the termination, dissolution, liquidation, and winding up of the Company, (ii) the termination of such Shareholder from the Company in accordance with Section, and (iii) such Shareholder's Transfer of its Shares.

**Section 11.04 Notices.** All notices, requests, consents, claims, demands, waivers, and other communications hereunder shall be in writing and shall be deemed to have been given (i) when delivered by hand (with written confirmation of receipt), (ii) when received by the addressee if sent by a nationally recognized overnight courier (receipt requested), (iii) on the date sent by facsimile or email of a PDF document (with confirmation of transmission) if sent during normal business hours of the recipient, and on the next Business Day if sent after normal business hours of the recipient, or (iv) on the third day after the date mailed, by certified or registered mail, return receipt requested, postage prepaid. Such communications must be sent to the respective parties at the following addresses (or at such other address for a party as shall be specified in a notice given in accordance with this Section 11.04):

If to the Company:

Hempacco Paper Co., Inc.

8700 E. Pinnacle Peak Rd. Suite 210

Scottsdale, AZ 85255

E-mail: sandro.piancone@ggiigroup.com

Attention: Sandro Piancone

with a copy to:

Brunson, Chandler, and Jones

175 S. Main Street, 14<sup>th</sup> Floor

Salt Lake City, UT 84111

E-mail: Lance@bcjlaw.com

Attention: Lance Brunson

If to Managing Shareholder:

If to Sonora Paper Company, Inc:

Sonora Paper Company, Inc.

4625 S. Alameda Street

Vernon

CA 90058

E-mail: info@sonorapaper.com

Attention: Daniel Kempton

with a copy to:

_________________________

_________________________

___________________________

E-Mail: ____________________

Attention: _________________

If to Hempacco Co., Inc.:

Hempacco Co., Inc.

9925 Airway Road

Sand Diego, CA 92154

E-mail: sandro.piancone@ggiigroup.com

Attention: Sandro Piancone

with a copy to:

Brunson, Chandler and Jones

175 S. Main Street, 14<sup>th</sup> Floor

Salt Lake City, UT 84111

E-mail: Lance@bcjlaw.com

Attention: Lance Brunson

**Section 11.05 Headings.** The headings in this Agreement are inserted for convenience or reference only and are in no way intended to describe, interpret, define, or limit the scope, extent, or intent of this Agreement or any provision of this Agreement.

**Section 11.06 Severability.** If any term or provision of this Agreement is held to be invalid, illegal, or unenforceable under Applicable Law in any jurisdiction, such invalidity, illegality, or unenforceability shall not affect any other term or provision of this Agreement or invalidate or render unenforceable such term or provision in any other jurisdiction. Except as provided in Section 9.01(h), on such determination that any term or other provision is invalid, illegal, or unenforceable, the parties hereto shall negotiate in good faith to modify this Agreement so as to affect the original intent of the parties as closely as possible in a mutually acceptable manner in order that the transactions contemplated hereby be consummated as originally contemplated to the greatest extent possible.

**Section 11.07 Entire Agreement.** This Agreement, together with the Articles of Organization and all related Exhibits and Schedules, constitutes the sole and entire agreement of the parties to this Agreement with respect to the subject matter contained herein and therein, and supersedes all prior and contemporaneous understandings, agreements, records, representations, and warranties, both written and oral, whether express or implied, with respect to such subject matter.

**Section 11.08 Successors and Assigns.** Subject to the restrictions on Transfers set forth herein, this Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective heirs, executors, administrators, successors, and permitted assigns. This Agreement may not be assigned by any Shareholder except as permitted by this Agreement and any assignment in violation of this Agreement shall be null and void *ab initio*.

**Section 11.09 No Third-Party Beneficiaries.** Except as provided in ARTICLE IX, which shall be for the benefit of and enforceable by Covered Persons as described therein, this Agreement is for the sole benefit of the parties hereto (and their respective heirs, executors, administrators, successors, and permitted assigns) and nothing herein, express or implied, is intended to or shall confer upon any other Person, including any creditor of the Company, any legal or equitable right, benefit, or remedy of any nature whatsoever under or by reason of this Agreement.

**Section 11.10 Amendment.** Except as otherwise provided by this Agreement, no provision of this Agreement may be amended or modified except by an instrument in writing executed by all of the Shareholders. Any such written amendment or modification will be binding upon the Company and each Shareholder. Notwithstanding the foregoing, amendments to the Shareholders Schedule following any new issuance, redemption, repurchase, or Transfer of Shares in accordance with this Agreement may be made by the Directors without the consent of or execution by the Shareholders.

**Section 11.11 Waiver.** No waiver by any party of any of the provisions hereof shall be effective unless explicitly set forth in writing and signed by the party so waiving. No waiver by any party shall operate or be construed as a waiver in respect of any failure, breach, or default not expressly identified by such written waiver, whether of a similar or different character, and whether occurring before or after that waiver. No failure to exercise, or delay in exercising, any right, remedy, power, or privilege arising from this Agreement shall operate or be construed as a waiver thereof, nor shall any single or partial exercise of any right, remedy, power, or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power, or privilege. For the avoidance of doubt, nothing contained in this Section 12.11 shall diminish any of the explicit and implicit waivers described in this Agreement, including in hereof.

**Section 11.12 Governing Law.** All issues and questions concerning the application, construction, validity, interpretation, and enforcement of this Agreement shall be governed by and construed in accordance with the internal laws of the State of Delaware, without giving effect to any choice or conflict of law provision or rule (whether of the State of Delaware or any other jurisdiction) that would cause the application of laws of any jurisdiction other than those of the State of Delaware.

**Section 11.13 Submission to Jurisdiction.** The parties hereby agree that any suit, action, or proceeding seeking to enforce any provision of, or based on any matter arising out of or in connection with, this Agreement or the transactions contemplated hereby, whether in contract, tort, or otherwise, shall be brought only in the United States District Court for Delaware or, the courts of the State of Delaware sitting in New Castle County, and any appellate court from any thereof, and that any cause of action arising out of this Agreement shall be deemed to have arisen from a transaction of business in the State of Delaware. Each of the parties hereby irrevocably consents to the jurisdiction of such courts in any such suit, action, or proceeding and irrevocably waives, to the fullest extent permitted by law, any objection that it may now or hereafter have to the laying of the venue of any such suit, action, or proceeding in any such court or that any such suit, action, or proceeding that is brought in any such court has been brought in an inconvenient form. Service of process, summons, notice, or other document by registered mail to the address set forth in Section 11.04 shall be effective service of process for any suit, action, or other proceeding brought in any such court.

**Section 11.14 Equitable Remedies.** Each party hereto acknowledges that a breach or threatened breach by such party of any of its obligations under this Agreement would give rise to irreparable harm to the other parties, for which monetary damages would not be an adequate remedy, and hereby agrees that in the event of a breach or a threatened breach by such party of any such obligations, each of the other parties hereto shall, in addition to any and all other rights and remedies that may be available to them in respect of such breach, be entitled to equitable relief, including a temporary restraining order, an injunction, specific performance, and any other relief that may be available from a court of competent jurisdiction (without any requirement to post bond).

**Section 11.15 Attorneys' Fees.** If any party hereto institutes any legal suit, action, or proceeding, including arbitration, against another party in respect of a matter arising out of or relating to this Agreement, the prevailing party in the suit, action, or proceeding shall be entitled to receive, in addition to all other damages to which it may be entitled, the costs incurred by such party in conducting the suit, action, or proceeding, including reasonable attorneys' fees and expenses and court costs.

**Section 11.16 Remedies Cumulative.** The rights and remedies under this Agreement are cumulative and are in addition to and not in substitution for any other rights and remedies available at law or in equity or otherwise, except to the extent expressly provided herein to the contrary.

**Section 11.17 Counterparts.** This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall be deemed to be one and the same agreement. A signed copy of this Agreement delivered by facsimile, email, or other means of Electronic Transmission shall be deemed to have the same legal effect as delivery of an original signed copy of this Agreement.

***[SIGNATURE PAGE FOLLOWS]***

**IN WITNESS WHEREOF**, the Company and the Shareholders have signed this Joint Venture Agreement of Hempacco Paper Co., Inc. as of the Effective Date.

---

| | |
|:---|:---|
| **COMPANY**: | **COMPANY**: |
| Hempacco Paper Co., Inc.<br> a Delaware Corporation | Hempacco Paper Co., Inc.<br> a Delaware Corporation |
| By: | */s/ Sandro Piancone* |
| Name: | Sandro Piancone |
| Title: | Chief Executive Officer |
| **SHAREHOLDERS**: | **SHAREHOLDERS**: |
| Hempacco Co., Inc.<br> a Nevada Corporation | Hempacco Co., Inc.<br> a Nevada Corporation |
| By: | */s/ Sandro Piancone* |
| Name: | Sandro Piancone |
| Title: | Chief Executive Officer |
| Sonora paper Company, Inc.<br> a California Corporation | Sonora paper Company, Inc.<br> a California Corporation |
| By: | */s/ Daniel Kempton* |
| Name: | Daniel Kempton |
| Title: | Director / Managing Partner |

---

**ADDENDUM**

*see 4.08(i) -Regarding Royalties:*

SPC partner Jawid Wahidi agrees to provide cone making machinery to the *N* in accordance with demand for this product. The JV will pay to Mr Wahidi a royalty of $0.0025 for each cone produced using this equipment.

*see 6.02(a)* - *Regarding Actions Requiring Supermajority Approval of Shareholders:*

removal of section 6.02(a)

*see 4.10 or Article XI???* - *Regarding Accommodations:*

The JV will provide lodging for the SPC director (Daniel Kempton). The location will be in a reasonable proximity to the manufacturing facilities and agreed upon by all parties. The accommodations shall include basic furnishings and appliances (such as bed, stove, refrigerator, mini-splits), parking, and utilities (water, gas, electricity, internet, garbage). Accommodations shall meet reasonable standards in regards to safety, general cleanliness and structural integrity.

***[SIGNATURE PAGE FOLLOWS]***

/s/ Sandro Piancone

/s/ Daniel Kempton

**SCHEDULE A** 

**SHAREHOLDERS SCHEDULE**

---

| | | |
|:---|:---|:---|
| **Shareholder Name** | **Capital Contribution** | **Shares** |
| <br> Hempacco Co., Inc. | <br> The initial property, plant and equipment plus working capital, as needed to commence operations in Mexico and/or the USA. | <br> 80% (800,000 (Common Shares) |
| <br> Sonora Paper Company, Inc.<br>| <br> Know-How, access to SPC's patented and patent pending technologies (on payment of additional, to be agreed, royalty payments) | <br> 20% (200,000 Common Shares) |

---

## Exhibit 10.49

**EXHIBIT 10.49**

JOINT VENTURE AGREEMENT

This Joint Venture Agreement (the "Agreement") of Organipure, Inc, a Nevada Corporation (the "Company"), is entered into and shall be effective as of the 10th day of November, 2022 (the "Effective Date") by and among the Company, High Sierra Technologies, Inc., a Nevada Corporation ("HSTI"), and Hempacco Co., Inc., a Nevada Corporation ("HCI"). The Company, HSTI and HCI are sometimes herein referred to as a "Party" and collectively as the "Parties".

RECITALS

WHEREAS, the Company was formed as a corporation under the laws of the State of Nevada, for the purposes set forth in Section 2.05 of this Agreement, when the Company's articles of incorporation (the "Articles of Incorporation") were filed with the Nevada Secretary of State on November 7, 2022 (the "Formation Date").

WHEREAS, HCI is a corporation formed under the laws of the State of Nevada (NASDAQ: HPCO) and as such is obligated to produce audited GAAP financial statements and file same with the Securities and Exchange Commission in accordance with the current regulations and timetables of that governing body.

WHEREAS, HSTI is currently a wholly owned subsidiary of High Sierra Technologies, Inc., a Colorado Corporation ("HSTICO") [OTCQB: HSTI] and as such is obligated to produce audited GAAP financial statements and file same with the Securities and Exchange Commission in accordance with the current regulations and timetables of that governing body.

WHEREAS, the parties wish to enter into this Agreement setting forth the terms and conditions governing the operation and management of the Company and the other matters set forth herein.

NOW, THEREFORE, in consideration of the mutual promises, covenants and agreements hereinafter set forth and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

ARTICLE I

Definitions

Section 1.01 Definitions. Capitalized terms used herein and not otherwise defined shall have the respective meanings set forth in this Section 1.01 and when not otherwise defined shall have the meanings set forth in the Nevada Revised Statutes, as are amended from time to time, or the Internal Revenue Code of the United States of America of 1986 as is amended from time to time.

"Additional Capital Contribution" has the meaning set forth in Section 3.02.

"Affiliate" means, with respect to any Person, any other Person who, directly or indirectly (including through one or more intermediaries), controls, is controlled by, or is under common control with, such Person. For purposes of this definition, "control," when used with respect to any specified Person, shall mean the power, direct or indirect, to direct or cause the direction of the management and policies of such Person, whether through ownership of voting securities or partnership or other ownership interests, by contract or otherwise; and the terms "controlling" and "controlled" shall have correlative meanings.

"Agreement" means this Joint Venture Agreement, as executed and as it may be amended, modified, supplemented, or restated from time to time, as provided herein.

"Applicable Law" means all applicable provisions of (a) constitutions, treaties, statutes, laws (including the common law), rules, regulations, decrees, ordinances, codes, proclamations, declarations, or orders of any Governmental Authority, (b) any consents or approvals of any Governmental Authority, and (c) any orders, decisions, advisory or interpretative opinions, injunctions, judgments, awards, decrees of, or agreements with, any Governmental Authority.

"Articles of Incorporation" has the meaning set forth in the Recitals.

"Available Cash Flow" means, for any period, the sum of gross revenue received, minus the sum of overhead and operating expenses of the Company, as well as a reasonable reserve for future operational needs as the Officers and Directors may determine to be necessary or appropriate. Notwithstanding the preceding sentence, capital contributions, loans, or proceeds from capital transactions and expenses incurred or liabilities of the Company repaid in connection with any thereof shall not be taken into account in computing Available Cash for any period.

"Budget" has the meaning set forth in Section 7.03.

"Business" means the business of marketing and selling hemp smokable products; it being acknowledged and agreed by the Shareholders that such products may include, without limitation "Delta 8 THC" to the extent the same can be legally produced and sold in the particular States of the United States of America where the Company intends to carry on business.

"Business Day" means a day other than a Saturday, Sunday, or other day on which commercial banks in the State of Nevada are authorized or required to close.

"Capital Account" has the meaning set forth in Section 3.03.

"Capital Contribution" means any Shareholder's contribution to the capital of the Company in cash and cash equivalents and the Book Value of any property contributed to the Company by such Shareholder.

"Code" means the Internal Revenue Code of 1986, as amended from time to time.

"Company" has the meaning set forth in the Preamble.

"Confidential Information" has the meaning set forth in Section 13.03(a).

"Covered Person" has the meaning set forth in Section 9.01(a).

"Directors" means, initially, Vincent C. Lombardi, Sandro Piancone, Gregg W. Koechlein, and Stuart Titus, or such other natural Persons as may be become the Directors pursuant to the terms of this Agreement. Initially, there shall be four (4) Directors of which HCI shall appoint two (2) of the initial Directors and HSTI shall appoint two (2) of the initial Directors. As soon as practicable following the effective date of this Agreement, HCI and HSTI shall mutually agree upon the fifth (5th) initial Director.

"Electronic Transmission" means (a) facsimile telecommunication, (b) email, (c) posting on an electronic message board or network that the Company has designated for communications (together with a separate notice to the recipient of the posting when the transmission is given by the Company), or (d) other means of electronic communication where the recipient has consented to the use of the means of transmission (or, if the transmission is to the Company, the Company has placed in effect reasonable measures to verify that the sender is the Shareholder, Director or Officer purporting to send the transmission) and the communication creates a record that is capable of retention, retrieval, and review and may be rendered into clearly legible tangible form.

"Excess Amount" has the meaning set forth in Section 6.02(c).

"Fair Market Value" of any asset as of any date means the purchase price that a willing buyer having all relevant knowledge would pay a willing seller for such asset in an arm's length transaction.

"Fiscal Year" means the calendar year, unless the Company is required to or elects to have a taxable year other than the calendar year, in which case Fiscal Year shall be the period that conforms to its taxable year.

"For Cause" shall mean an Officer's or a Director's:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) willful failure to perform his duties (other than any such failure resulting from incapacity due to physical or mental illness) and a failure to cure the same within 10 business days of receipt of written notice thereof from another Shareholder, Director or Officer;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) engagement in dishonesty, illegal conduct, or misconduct relating to the business of the Company, which is injurious to the Company or its Affiliates; and the same is not cured (if capable of cure) within ten (10) business days of receipt of written notice thereof from another Shareholder, Director or Officer:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) embezzlement, misappropriation, or fraud, whether or not related to the Company;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) conviction of or plea of guilty or nolo contendere to a crime that constitutes a felony (or state law equivalent) or a crime that constitutes a misdemeanor involving moral turpitude;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) willful unauthorized disclosure of Confidential Information;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) breach of any material obligation under this Agreement which is not cured within ten (10) business days of receipt of written notice thereof from another Shareholder, Director or Officer.

"Governmental Authority" means any federal, state, local, or foreign government or political subdivision thereof, or any agency or instrumentality of such government or political subdivision, or any self-regulated organization or other non-governmental regulatory authority or quasi-governmental authority (to the extent that the rules, regulations, or orders of such organization or authority have the force of law), or any arbitrator, court, or tribunal of competent jurisdiction.

"Independent Third Party" means, with respect to any Shareholder, any Person who is not an Affiliate of such Shareholder.

"Lien" means any mortgage, pledge, security interest, option, right of first offer, encumbrance, or other restriction or limitation of any nature whatsoever.

"Liquidator" has the meaning set forth in Section 11.03(a).

"Losses" has the meaning set forth in Section 9.01(b).

"Majority" means 51% or more of those entitled to vote on any matter.

"NRS" means the Nevada General Corporation Law, Chapter 78 of the Revised Statutes of Nevada as in effect at any given time.

"Shareholder(s)" means HSTI and HCI, and each Person or Entity who is hereafter admitted as a Shareholder in accordance with the terms and conditions of this Agreement and the NRS, The Shareholders shall constitute "Shareholders" (as that term is defined in the NRS) of the Company.

"Shareholders Schedule" has the meaning set forth in Section 3.01.

&nbsp;&nbsp;&nbsp;&nbsp;"Shareholder" A Shareholder (aka Stockholder) is any person, company, or institution that owns shares in a company's stock. Shareholders are subject to capital gains (or losses) and/or dividend payments as residual claimants on a firm's profits. Shareholders also enjoy certain rights such as voting at shareholder meetings to approve the board of directors', dividend distributions, or mergers. In the case of bankruptcy, shareholders can lose up to their entire investment.

"Net Income" and "Net Loss" mean, for each Fiscal Year or other period specified in this Agreement, an amount equal to the Company's taxable income or taxable loss, or particular items thereof, determined in accordance with Code Section 703(a) (where, for this purpose, all items of income, gain, loss, or deduction required to be stated separately pursuant to Code Section 703(a)(1) shall be included in taxable income or taxable loss), but with the following adjustments:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) any gain or loss resulting from any disposition of Company property with respect to which gain or loss is recognized for federal income tax purposes shall be computed by reference to the Book Value of the property so disposed, notwithstanding that the adjusted tax basis of such property differs from its Book Value; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) if the Book Value of any Company property is adjusted as provided in the definition of Book Value, then the amount of such adjustment shall be treated as an item of gain or loss and included in the computation of such taxable income or taxable loss.

"Officers" has the meaning set forth in Section 7.04.

"Percentage Interest" means the percentage of a Shareholder's Shares in the Company relative to the entire outstanding Shares in the Company, which is equal to the quotient of the Shares held by a Shareholder divided by all issued and outstanding Shares of the Company held by all Shareholders, as may be adjusted from time to time by the Managing Directors.

"Person" means an individual, corporation, partnership, joint venture, limited liability company, Governmental Authority, unincorporated organization, trust, association, or other entity.

"Regulatory Allocations" has the meaning set forth in Section 5.02(e).

"Related Party Agreement" means any agreement, arrangement, or understanding between the Company and any Shareholder, Director or Officer, or other employee of the Company or any Affiliate of a Shareholder, Director, Officer, or other employee of the Company; in each case, as such agreement may be amended, modified, supplemented, or restated in accordance with the terms of this Agreement. It is agreed by the Shareholders that any and all Related Party Agreements between the Company and HCI, HSTI and/or any Affiliate thereof shall provide for the pass-through of HCI's, HSTI's and/or such Affiliate's costs to the Company without markup.

"Representative" means, with respect to any Person, any and all Shareholders, officers, employees, consultants, financial advisors, counsel, accountants, and other agents of such Person.

"Securities Act" means the Securities Act of 1933, as amended, or any successor federal statute, and the rules and regulations thereunder, which shall be in effect at the time.

"Shareholders" means the Joint Venturers, those being HSTI and HCI.

"Subsidiary" means, with respect to any Person, any other Person of which a Majority of the outstanding shares or other equity interests having the power to vote for Shareholders or comparable managers are owned, directly or indirectly, by the first Person.

"Supermajority" means Shareholders holding a Percentage Interest of 60% or more.

"Tax Advance" has the meaning set forth in Section 6.02(a).

"Tax Amount" of a Shareholder for a Fiscal Year means the product of (a) the Tax Rate for such Fiscal Year and (b) the Adjusted Taxable Income of the Shareholder for such Fiscal Year with respect to its Shares.

"Tax Rate" of a Corporate Shareholder, for any period, means the highest effective marginal combined federal, state, and local tax rate applicable to a corporation doing business in Reno, Nevada, taking into account (a) the character (for example, long-term or short-term capital gain, ordinary or exempt) of the applicable income and (b) if applicable the deduction under IRC Section 199A.

"Transfer" means to, directly or indirectly, sell, transfer, assign, gift, pledge, encumber, hypothecate, or similarly dispose of, either voluntarily or involuntarily, by operation of law or otherwise, or to enter into any contract, option, or other arrangement or understanding with respect to the sale, transfer, assignment, gift, pledge, encumbrance, hypothecation, or similar disposition of, any Shares owned by a Person or any interest (including a beneficial interest) in any Shares owned by a Person. "Transfer" when used as a noun, and "Transferred" when used to refer to the past tense, shall have correlative meanings. "Transferor" and "Transferee" mean a Person who makes or receives a Transfer, respectively.

"Treasury Regulations" means the final or temporary regulations issued by the United States Department of Treasury pursuant to its authority under the Code, and any successor regulations.

"Withholding Advances" has the meaning set forth in Section 6.03(b).

Section 1.02 Interpretation. For purposes of this Agreement, (a) the words "include," "includes," and "including" shall be deemed to be followed by the words "without limitation," (b) the word "or" is not exclusive, and (c) the words "herein," "hereof," "hereby," "hereto," and "hereunder" refer to this Agreement as a whole. The definitions given for any defined terms in this Agreement shall apply equally to both the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine, and neuter forms. Unless the context otherwise requires, references herein (x) to Articles, Sections, Exhibits, and Schedules mean the Articles and Sections of and Exhibits and Schedules attached to this Agreement, (y) to an agreement, instrument, or other document means such agreement, instrument, or other document as amended, restated, supplemented, and modified from time to time to the extent permitted by the provisions thereof, and (z) to a statute or Applicable Law means such statute or Applicable Law as amended from time to time and includes any successor legislation thereto and any regulations promulgated thereunder. This Agreement shall be construed without regard to any presumption or rule requiring construction or interpretation against the party drafting an instrument or causing any instrument to be drafted. The Exhibits and Schedules referred to herein shall be construed with, and as an integral part of, this Agreement to the same extent as if they were set forth verbatim herein.

ARTICLE II

Organization

Section 2.01 Formation.

(a)The Company was formed on November 7, 2022, pursuant to the provisions of the NRS, upon the filing of the Articles of Incorporation with the Nevada Secretary of State.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) This Agreement shall constitute the "Joint Venture Agreement" (as that term is used in the NRS or otherwise) of the Company. The rights, powers, duties, obligations, and liabilities of the Shareholders shall be determined pursuant to this Agreement. To the extent that the rights, powers, duties, obligations, and liabilities of any Shareholder are by reason of any provision of this Agreement in conflict with the NRS, this Agreement shall, to the extent permitted by the NRS, control.

Section 2.02 Name. The name of the Company is "Organipure, Inc., a Nevada Corporation" or such other name or names as may be designated by the Directors. The Company may conduct business under any assumed or fictitious name deemed desirable by the Directors.

Section 2.03 Principal Office. The principal office of the Company is located at 1495 Ridgeview Drive, Suite 230A, Reno, NV 89519 or such other place as may from time to time be determined by the Directors. The Directors shall give prompt notice of any such change to each of the Shareholders.

Section 2.04 Office and Agent for Service of Process.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The office for service of process on the Company in the State of Nevada shall be the office of the initial agent named in the Articles of Incorporation or such other office (which need not be a place of business of the Company) as the Directors may designate from time to time in the manner provided by the NRS and Applicable Law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The agent for service of process on the Company in the State of Nevada shall be the initial agent named in the Articles of Incorporation or such other Person or Persons as the Directors may designate from time to time in the manner provided by the NRS and Applicable Law.

Section 2.05 Purpose; Powers.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) The purpose of the Company is to engage in the Business and any other lawful act or activity for which a corporation may be formed under the NRS and to engage in any and all activities necessary or incidental thereto.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The Company shall have all the powers necessary or convenient to carry out the purposes for which it is formed, including the powers granted by the NRS.

Section 2.06 Term. The term of the Company commenced on the date the Articles of Incorporation that were filed with the Nevada Secretary of State and shall continue in existence perpetually until the Company is dissolved in accordance with the provisions of this Agreement or as provided by the NRS or Applicable Law.

ARTICLE III

Capital Contributions; Capital Accounts

Section 3.01 Initial Capital Contributions. Contemporaneously with the execution of this Agreement, each Shareholder has made an initial Capital Contribution and is deemed to own the Percentage Interest set forth opposite such Shareholder's name on Schedule A attached hereto and incorporated by reference herein (the "Shareholders Schedule"). The Managing Directors shall update the Shareholders Schedule upon the issuance or Transfer of any Shares to any new or existing Shareholder in accordance with this Agreement.

Section 3.02 Additional Capital Contributions. No Shareholder shall be required to make any additional Capital Contributions to the Company. However, a Shareholder may make an additional Capital Contribution (an "Additional Capital Contribution") at any time with the written consent of the Directors. Any such Additional Capital Contribution shall be treated as a loan from the contributing Shareholder to the Company and shall have no effect on the Shareholder's relative equity position.

Section 3.03 Maintenance of Capital Accounts. The Company shall establish and maintain the customary capital accounts required under GAAP for a corporation, which include but are not limited to:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a) Issued Common Shares

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b) Issued Preferred Shares

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c) Additional Paid-in Capital

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d) Retained Earnings

The Company's financial statements will include a "Statement of Stockholders Equity" which will provide full details of the transactions affecting these capital accounts on a quarterly basis.

Section 3.04 No Withdrawals From Capital Accounts. No Shareholder shall be entitled to withdraw any part of its Capital Account or to receive any distribution from the Company, except as otherwise provided in this Agreement. No Shareholder, including the Directors, shall receive any interest, salary, or drawing with respect to its Capital Contributions or its Capital Account, except as otherwise provided in this Agreement. The Capital Accounts are maintained for the sole purpose of allocating items of income, gain, loss, and deduction among the Shareholders and shall have no effect on the amount of any distributions to any Shareholders, in liquidation or otherwise.

Section 3.05 Treatment of Loans From Shareholders. Loans by any Shareholder to the Company shall not be considered Capital Contributions and shall not affect the maintenance of such Shareholder's Capital Account, other than to the extent provided in Section 3.03, above, if applicable.

ARTICLE IV

Shareholders

Section 4.01 Admission of New Shareholders.

(a)New Shareholders, having been approved by the Directors, may be admitted from time to time (i) in connection with the issuance of Shares by the Company, subject to compliance with the provisions of Section 7.02(b) and Section 8.01(b), and (ii) in connection with a Transfer of Shares, subject to compliance with the provisions of ARTICLE VII, and in either case, following compliance with the provisions of Section 4.01(b).

(b)In order for any Person not already a Shareholder of the Company to be admitted as a Shareholder, whether pursuant to an issuance or Transfer of Shares, such Person shall have delivered to the Company an executed written undertaking substantially in the form of the Joinder Agreement. Upon the amendment of the Shareholders Schedule by the Directors and the satisfaction of all other applicable conditions, including, if a condition, the receipt by the Company of payment for the issuance of Shares, such Person shall be admitted as a Shareholder and deemed listed as such on the books and records of the Company. The Directors shall also adjust the Capital Accounts of the Shareholders as necessary in accordance with Section 3.03.

Section 4.02 No Personal Liability. Except as otherwise provided by the NRS, by Applicable Law, or expressly in this Agreement, no Director or Shareholder will be obligated personally for any debt, obligation, or liability of the Company or other Shareholders, whether arising in contract, tort, or otherwise, solely by reason of being or acting as a Shareholder. Except as otherwise provided by the NRS, by Applicable Law, or expressly in this Agreement, no Director will be obligated personally for any debt, obligation, or liability of the Company, whether arising in contract, tort, or otherwise, solely by reason of being or acting as a Director.

Section 4.03 Dissociation. No Shareholder shall have the ability to dissociate or withdraw as a Shareholder before the dissolution and winding up of the Company, and any such dissociation or withdrawal or attempted dissociation or withdrawal by a Shareholder before the dissolution or winding up of the Company shall be null and void *ab initio*. As soon as any Person who is a Shareholder ceases to hold any Shares, such Person shall no longer be a Shareholder.

Section 4.04 No Interest in Company Property. No real or personal property of the Company shall be deemed to be owned by any Shareholder individually, but shall be owned by, and title shall be vested solely in, the Company. Without limiting the foregoing, each Shareholder hereby irrevocably waives during the term of the Company any right that such Shareholder may have to maintain any action for partition with respect to the property of the Company.

Section 4.05 Certification of Shares. The Directors shall issue certificates to the Shareholders and shall record or cause to be recorded all issuances, exchanges, and other transactions in Shares involving the Shareholders in a ledger maintained as part of the books and records of the Company.

Section 4.06 Meetings.

(a)The regular Annual Meeting of the Shareholders shall be held as is set forth in the By-laws of the Company. Special meetings of the Shareholders regarding matters required to be submitted to the Shareholders under this Agreement may be called by (i) any of the Directors, or (ii) any Shareholder holding a Percentage Interest of 10% or more.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Written notice stating the place, date, and time of the meeting, the means of electronic video screen communication or Electronic Transmission by and to the Company, if any, and the general nature of the business to be transacted at the meeting, shall be delivered not fewer than 5 days and not more than 60 days before the date of the meeting to each Shareholder, by or at the direction of the Directors or the Shareholder(s) calling the meeting, as the case may be. The business to be conducted at such meeting shall be limited to the purposes described in the notice. The Shareholders may hold meetings at the Company's principal office or at such other place, within or outside the State of Nevada, as the Director(s) or the Shareholder(s) calling the meeting may designate in the notice for such meeting.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Any Shareholder may participate in a meeting of the Shareholders (i) using conference telephone or electronic video screen communication, if all Persons participating in the meeting can talk to and hear each other or (ii) by Electronic Transmission by and to the Company if the Company (1) implements reasonable measures to provide Shareholders, in person or by proxy, a reasonable opportunity to participate and vote, including an opportunity to read or hear the meeting's proceedings substantially concurrently with the proceedings and (2) maintains a record of votes or other action taken by the Shareholders. Participation in a meeting by such means shall constitute presence in person at such meeting.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) On any matter that is to be voted on by the Shareholders, a Shareholder may vote in person or by proxy, and such proxy may be granted in writing signed by such Shareholder, using Electronic Transmission authorized by such Shareholder, or as otherwise permitted by Applicable Law. Every proxy shall be revocable in the discretion of the Shareholder executing it unless otherwise provided in such proxy; provided, that such right to revocation shall not invalidate or otherwise affect actions taken under such proxy before such revocation.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Attendance of a Shareholder at any meeting shall constitute a waiver of notice of such meeting, except where a Shareholder attends a meeting for the express purpose of objecting to the transaction of any business on the ground that the meeting is not lawfully called or convened. Attendance of a Shareholder at a meeting is not a waiver of the Shareholder's right to object to consideration of matters required to be described in the notice for the meeting, if the Shareholder expressly objects to such consideration at the meeting.

Section 4.07 Action Without a Meeting. Notwithstanding the provisions of Section 4.06, any matter that is to be voted on by the Shareholders may be taken without a meeting by written consent signed and delivered (including by Electronic Transmission) to the Company by the Shareholders holding the requisite Percentage Interest for such matters had a meeting been taken. A record shall be maintained in the Company's books and records by the Managing Directors of each such action taken by written consent of a Shareholder or the Shareholders.

Section 4.08 Shareholder Services.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) For so long as HCI and HSTI shall remain as Shareholders of the Company, HCI and HSTI shall, without limitation, perform or cause to be performed the following services for and on behalf of the Company and with such compensation as may be agreed to by HSTI and HCI:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) Product manufacturing and packaging shall be done by HCI. Initially the processing of the raw biomass shall be done by HSTI and subsequently it shall be done by HCI.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) CRM management shall be done mutually by HCI and HSTI.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Product Development shall be done mutually by HCI and HSTI.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv) Direct to consumer fulfillment, wholesale and retail distribution shall be done by HSTI.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v) All GAAP accounting services and auditing requirements including payment processing and income tax preparation shall be done mutually by HCI and HSTI.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi) Inventory Management and Hemp processing shall be done mutually by HCI and HSTI.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii) Research & Development and Intellectual Property shall be done mutually by HCI and HSTI.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(viii) Staff training and mentoring shall be done mutually by HCI and HSTI.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ix) eCommerce shall be done mutually by HCI and HSTI.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(x) Trade show space and Marketing shall be done by HCI.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xi) Kiosk Sales and placement shall be done by HCI.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xii) Investor and Public Relations shall be done mutually by HCI and HSTI.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xiii) Public Accounting, Audits and associated legal expenses shall be done mutually by HCI and HSTI.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xiv) Online marketing and promotion shall be done mutually by HCI and HSTI.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xv) Design and branding shall be done mutually by HCI and HSTI. -

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xvi) Brand Management and Development shall be done mutually by HCI and HSTI.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xvii) Securing Trademarks shall be done mutually by HCI and HSTI.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xviii) Social Media marketing specifications for brands shall be done by HCI.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(xviv) Sales and distribution into current distributors shall be done mutually by HCI and HSTI.

ARTICLE V

Allocations

Section 5.01 Distributions of Net Income and Net Loss to shareholders. For each Fiscal Year (or portion thereof), Net Income and Net Loss of the Company shall be transferred to the Retained Earnings account of the Company.

After considering further distributions for Federal and State Income Taxes, and after considering the balance of working capital that should be retained in the business, then the Directors will decide on the amount, if any, of the dividends that will be distributed to the Shareholders in accordance with their respective percentage interests.

ARTICLE VI

Section 6.01 Management of the Company. The Company shall be managed by a Board of Directors consisting of three (3) to seven (7) board members. Initially the Board of Directors shall have five (5) members. HCI will have the right to appoint two (2) of the initial board members and HSTI shall have the right to appoint two (2) of the initial board members. HCI and HSTI shall mutually agree upon the appointment of a fifth (5th) initial board member.

Subject to any other provisions to the contrary in this Agreement, the Directors shall have full and complete discretion to manage and control the business, property, activities, and affairs of the Company, to make all decisions affecting the business, property, activities, and affairs of the Company, and to take all such actions as they deem necessary or appropriate to accomplish the purposes of the Company set forth in Section 2.05. The actions of the Directors taken in accordance with the provisions of this Agreement shall bind the Company.

Section 6.02 Actions Requiring Supermajority Approval of Shareholders. Notwithstanding anything to the contrary contained herein, without the prior written consent of a Supermajority of the Shareholders, the Company or the Directors, on behalf of the Company, shall not, and shall not enter into any commitment to:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) amend, modify, or waive any provisions of the Articles of Incorporation;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) issue additional Shares or other debt or equity instruments or, except in connection with a Transfer of Shares that complies with the applicable provisions of ARTICLE VII and Section 4.01(b), admit additional Shareholders to the Company;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) enter into, amend, waive, or terminate any Related Party Agreement other than the entry into or the amendment of a Related Party Agreement that is on terms no less favorable to the Company than those that could be obtained from an unaffiliated third party (it being understood and agreed by the Shareholders that any and all Related Party Agreements between the Company and HCI and/or any Affiliate thereof shall provide for the pass-through of HCI's and/or such Affiliate's costs to the Company without markup);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) enter into or effect any transaction or series of related transactions involving the purchase, lease, license, exchange, or other acquisition (including by merger, consolidation, acquisition of stock, or acquisition of assets) by the Company of any assets or equity interests of any Person, other than the license of assets in the ordinary course of business;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) enter into or effect any transaction or series of related transactions involving the sale, lease, license, exchange, or other disposition (including by merger, consolidation, sale of stock, or sale of assets) by the Company of any assets or equity interests, other the license of assets in the ordinary course of business; establish a Subsidiary or enter into any joint venture or similar business arrangement;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) settle any lawsuit, action, dispute, or other proceeding or otherwise assume any liability or agree to the provision of any equitable relief by the Company other than settlements which individually are for less than $10,000; provided, that if the lawsuit, claim, dispute, or other proceeding involves an indemnification claim pursuant to ARTICLE VII, such settlement shall also be approved in accordance with the terms of Section 8.01(c);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) change the number of Directors;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) create any incentive equity plan for employees and/or independent contractors;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) change the Business of the Company in any material way; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(j) dissolve the Company.

Section 6.03 Budgets. At least sixty (60) days before the beginning of each Fiscal Year, the officers of HCI and HSTI shall jointly prepare and submit to the Directors for approval an annual business plan and budget for the Company through the Fiscal Year ending December 31 (a "Budget").

Each Budget shall include detailed capital and operating expense budgets, cash flow projections (which shall include amounts and due dates of all projected calls for Additional Capital Contributions, if any) and profit and loss projections. The Directors shall operate the Company in accordance with the approved Budgets.

Section 6.04 Officers. The Directors may appoint individuals as officers of the Company (the "Officers") as the Directors deem necessary or desirable to carry on the business of the Company and the Directors may delegate to such Officers such power and authority as they deem advisable. No Officer need be a Shareholder of the Company. Any individual may hold two or more offices of the Company. Each Officer shall hold office until his or her successor is designated by the Directors or until his or her earlier death, resignation, or removal. Any Officer may resign at any time on written notice to the Directors. Any Officer may be removed by the Directors for Cause at any time. A vacancy in any office occurring because of death, resignation, removal, or otherwise, may, but need not, be filled by the Directors.

Section 6.05 Compensation. The Directors shall not be compensated for their services as Directors, but the Company shall reimburse the Directors upon written demand for any and all ordinary, necessary, and direct expenses incurred by the Directors on behalf of the Company in carrying out the Company's business activities. All reimbursements for expenses shall be reasonable in amount and shall not exceed amounts set forth in the Budget for any Fiscal Year.

Section 6.06 Removal of Directors. Any Director may be removed by the disinterested Directors at any time For Cause. Following such removal, a successor Director shall be appointed by the unanimous vote of the Shareholders.

Section 6.07 Resignation of a Director. A Director may resign at any time by giving at least 30 days' prior written notice to the Company. Any such resignation shall be effective on receipt thereof unless it is specified to be effective at some other time or on the occurrence of some other event. The Company's acceptance of a resignation shall not be necessary to make it effective. The resignation of a Director shall not affect its or its Affiliate's rights as a Shareholder (if applicable) and shall not constitute a dissociation of any Shareholder. Following such resignation, a successor Director shall be appointed as provided in Section 6.06 above.

Section 6.08 Exclusivity. Any Shareholder and/or any Affiliate of a Shareholder may engage in or possess an interest in other business ventures (including without limitation in cannabidiol and/or cannabis product related ventures), unconnected with the Company and independently or with others. The Company shall not have any rights in or to any such independent venture or the income or profits therefrom by virtue of this Agreement. Notwithstanding the foregoing, no Shareholder nor any Affiliate of a Shareholder shall own, operate, have an interest in or render services for any business (other than the Company) that is involved in the sale of hemp smokable products and which is directly competitive with the Business. Notwithstanding the foregoing, HCI and HSTI shall be entitled to continue to be engaged in any and all of their current business activities and ventures.

Section 6.09 No Personal Liability. Except as otherwise provided in NRS, which gives protection against personal liability for company actions and expenditures provided that Directors and Officers make informed, independent decisions in the performance of their duties no Director nor any Shareholder will be obligated personally for any debt, obligation, or liability of the Company, whether arising in contract, tort, or otherwise, solely by reason of being or acting as a Director or Shareholder.

ARTICLE VII

Transfer

Section 7.01 General Restrictions on Transfer.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) No Shareholder shall Transfer all or any portion of its Shares in the Company without the written consent of the Directors and the other Shareholders. No Transfer of Shares to a Person not already a Shareholder of the Company shall be deemed completed until the prospective Transferee is admitted as a Shareholder of the Company in accordance with Section 4.01(b) hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Each party to this Agreement will have the first right of refusal to purchase from the other joint venture partner, the other 50% of the shares of the company. Such purchase shall be made in accordance with the provisions of Section 7.02.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Notwithstanding any other provision of this Agreement, each Shareholder agrees that it will not Transfer all or any portion of its Shares in the Company, and the Company agrees that it shall not issue any additional shares unless all of the Shareholders approve of such issuance.

Section 7.02 Involuntary Transfers.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) On the date of the occurrence of an Involuntary Transfer ("Transfer Event"), the Involuntary Transferee of such Shares shall thereupon become an Economic Interest Holder and shall not become, a Shareholder, unless admitted as a Shareholder pursuant to Section 4.01(b). On a Transfer Event, the Involuntary Transferee shall be deemed to have offered for sale, without any further action required, the entire Shares subject to the Involuntary Transfer ("Affected Shares").

First, the Company shall have thirty (30) days from said date within which to elect to purchase some or all of the Affected Shares, and if the Company elects not to do so within said 30-day period, then the remaining Shareholders shall have thirty (30) days to elect to purchase their pro-rata share (based on their current Percentage Interest) of the Affected Shares. In the event that the exercise of any such election must be approved in any legal proceeding and such approval does not occur within the time periods set forth in this Section, such time periods shall be extended and tolled until fifteen (15) days after the date of any such approvals in order to permit the orderly exercise of such elections. The purchase price for such Affected Shares shall be Fair Market Value as of the Transfer Event.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) In the event that the Company and the remaining Shareholders elect not to purchase some or all of the Affected Shares in accordance with this Section 7.02(a), the Involuntary Transferee of the portion of such Shares that is not purchased shall hold such portion of such Shares solely as an Economic Interest holder and shall be entitled to the Economic Interest derived from such Shares, but not to any other rights of ownership of such Shares.

Section 7.03 Determination of Fair Market Value. Each of the selling and purchasing parties shall use best efforts to determine the Fair Market Value of the Shares offered for sale under Section 7.02. If the parties are unable to agree thereon, then each party shall appoint an appraiser within thirty (30) days of purchaser's election to purchase such Shares ("Appointment Period"). The two appraisers shall elect a third appraiser within fifteen (15) days of the last day of the Appointment Period who shall determine the Fair Market Value of the Shares being purchased, and the average of the two appraisals which are nearest to each other will be the Fair Market Value of the Shares.

The costs of each of the first two appraisers will be paid by the Shareholder who appointed the appraiser, and the costs of the third appraiser will be paid by the Company. Said determination shall be final and binding on the parties. All appraisers selected will be qualified and will be individuals with the "Accredited in Business Valuation" credential of the American Institute of Certified Public Accountants or the "Accredited Senior Appraiser" designation of the American Society of Appraisers.

ARTICLE VIII

Indemnification

Section 8.01 Covered Persons.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Covered Persons. As used herein, the term "Covered Person" shall mean (i) each Shareholder, (ii) each Director, (iii) each Officer, Shareholder, Manager, Affiliate, employee, agent, or Representative of each Shareholder and of each Director, and each of their respective Affiliates, and (iv) each Officer, employee, agent, or Representative of the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Indemnification. To the fullest extent permitted under the NRS (after waiving all NRS restrictions on indemnification other than those which cannot be eliminated or modified under the NRS), as the same now exists or may hereafter be amended, substituted, or replaced (but, in the case of any such amendment, substitution, or replacement, only to the extent that such amendment, substitution, or replacement permits the Company to provide broader indemnification rights than NRS permitted the Company to provide before such amendment, substitution, or replacement), the Company shall indemnify, hold harmless, defend, pay, and reimburse any Covered Person against any and all losses, claims, damages, judgments, fines, or liabilities, including reasonable legal fees or other expenses incurred in investigating or defending against such losses, claims, damages, judgments, fines, or liabilities, and any amounts expended in settlement of any claims (collectively, "Losses") to which such Covered Person may become subject by reason of:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) any act or omission or alleged act or omission performed or omitted to be performed on behalf of the Company, any Shareholder, any Director, any Officer, or any of their respective direct or indirect Subsidiaries in connection with the business of the Company; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) such Covered Person being or acting in connection with the business of the Company as a Shareholder, Director, Affiliate, Director, Shareholder, officer, employee, agent, or Representative of the Company, any Shareholder, any Director, or any of their respective Affiliates, or such Covered Person serving or having served at the request of the Company as a Shareholder, Director, officer, employee, agent, or Representative of any Person including the Company; provided, that such Loss did not arise from (1) the Covered Person's conduct involving bad faith, willful or intentional misconduct, or a knowing violation of law, (2) a transaction from which such Covered Person derived an improper personal benefit, (3) a circumstance under which the liability provisions for improper distributions of the NRS are applicable, or (4) a breach of such Covered Person's fiduciary duties or obligations under the NRS.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Control of Defense. On a Covered Person's discovery of any claim, lawsuit, or other proceeding relating to any Losses for which such Covered Person may be indemnified pursuant to this Section 8.01, the Covered Person shall give prompt written notice to the Company of such claim, lawsuit, or proceeding; provided, that the failure of the Covered Person to provide such notice shall not relieve the Company of any indemnification obligation under this Section 9.01, unless the Company shall have been materially prejudiced thereby. Subject to the approval of the holders of the Majority of the Shares held by the disinterested Shareholders, the Company shall be entitled to participate in or assume the defense of any such claim, lawsuit, or proceeding at its own expense. After notice from the Company to the Covered Person of its election to assume the defense of any such claim, lawsuit, or proceeding, the Company shall not be liable to the Covered Person under this Agreement or otherwise for any legal or other expenses subsequently incurred by the Covered Person in connection with investigating, preparing to defend, or defending any such claim, lawsuit, or other proceeding. If the Company does not elect (or fails to elect) to assume the defense of any such claim, lawsuit, or proceeding, the Covered Person shall have the right to assume the defense of such claim, lawsuit, or proceeding as it deems appropriate, but it shall not settle any such claim, lawsuit, or proceeding without the consent of the holders of the Majority of the Shares held by the disinterested Shareholders (which consent shall not be unreasonably withheld, conditioned, or delayed).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Reimbursement. The Company shall promptly reimburse (or advance to the extent reasonably required) each Covered Person for reasonable legal or other expenses (as incurred) of such Covered Person in connection with investigating, preparing to defend, or defending any claim, lawsuit, or other proceeding relating to any Losses for which such Covered Person may be indemnified pursuant to this Section 8.01; provided, that if it is finally judicially determined that such Covered Person is not entitled to the indemnification provided by this Section 8.01, then such Covered Person shall promptly reimburse the Company for any reimbursed or advanced expenses.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) Entitlement to Indemnity. The indemnification provided by this Section 8.01 shall not be deemed exclusive of any other rights to indemnification to which those seeking indemnification may be entitled under any agreement or otherwise. The provisions of this Section 9.01 shall continue to afford protection to each Covered Person regardless of whether such Covered Person remains in the position or capacity pursuant to which such Covered Person became entitled to indemnification under this Section 8.01 and shall inure to the benefit of the executors, administrators, legatees, and distributees of such Covered Person.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) Insurance. To the extent available on commercially reasonable terms, the Company may purchase, at its expense, insurance (i) to cover Losses covered by the indemnification provisions contained in this ARTICLE VIII, and (ii) to otherwise cover Losses for any breach or alleged breach by any Covered Person of such Covered Person's duties whether or not covered by the foregoing indemnifications, in each case, in such amount and with such deductibles as the Directors may reasonably determine; provided, that the failure to obtain such insurance shall not affect the right to indemnification of any Covered Person under the indemnification provisions contained in this ARTICLE VIII, including the right to be reimbursed or advanced expenses or otherwise indemnified for Losses hereunder. If any Covered Person recovers any amounts in respect of any Losses from any insurance coverage, then such Covered Person shall, to the extent that such recovery is duplicative, reimburse the Company for any amounts previously paid to such Covered Person by the Company in respect of such Losses.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(f) Funding of Indemnification Obligation. Notwithstanding anything contained herein to the contrary, any indemnity by the Company relating to the matters covered in this Section 8.01 shall be provided out of and to the extent of Company assets only, and no Shareholder (unless such Shareholder otherwise agrees in writing) shall have personal liability on account thereof or shall be required to make additional Capital Contributions to help satisfy such indemnity by the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(g) Savings Clause. If this Section 8.01 or any portion hereof shall be invalidated on any ground by any court of competent jurisdiction, then the Company shall nevertheless indemnify and hold harmless each Covered Person pursuant to this Section 8.01 to the fullest extent permitted by any applicable portion of this Section 8.01 that shall not have been invalidated and to the fullest extent permitted by Applicable Law.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(h) Amendment. The provisions of this Section 8.01 shall be a contract between the Company, on the one hand, and each Covered Person who served in such capacity at any time while this Section 8.01 is in effect, on the other hand, pursuant to which the Company and each such Covered Person intend to be legally bound. No amendment, modification, or repeal of this Section 8.01 that adversely affects the rights of a Covered Person to indemnification for Losses incurred or relating to a state of facts existing before such amendment, modification, or repeal shall apply in such a way as to eliminate or reduce such Covered Person's entitlement to indemnification for such Losses without the Covered Person's prior written consent.

Section 8.02 Survival. The provisions of this ARTICLE VIII shall survive the dissolution, liquidation, winding up, and termination of the Company.

ARTICLE IX

Accounting; Inspection Rights; Tax Matters

Section 9.01 Financial Statements. The Company shall furnish to each Shareholder the following reports:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Annual Financial Statements. As soon as available, and in any event within 90days after the end of each Fiscal Year, unaudited balance sheets of the Company as of the end of each such Fiscal Year and unaudited statements of income, cash flows, and Shareholders' equity for such Fiscal Year. These financial statements will be prepared on an accrual basis and in accordance with Generally Accepted Accounting Principles ("GAAP") in the United States.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Quarterly Financial Statements. As soon as available, and in any event within 45 days after the end of each quarterly accounting period in each Fiscal Year (other than the last fiscal quarter of the Fiscal Year), unaudited balance sheets of the Company as of the end of each such fiscal quarter and for the current Fiscal Year to date and unaudited statements of income, cash flows, and Shareholders' equity for such fiscal quarter and for the current Fiscal Year to date.

Section 9.02 Inspection Rights. Upon reasonable notice from a Shareholder, the Company shall afford the Shareholder and each of its respective Representatives access during normal business hours to (i) the Company's properties, offices, and other facilities, (ii) the corporate, financial, and similar records, reports, and documents of the Company, including, without limitation, all books and records, minutes of proceedings, internal management documents, reports of operations, reports of adverse developments, copies of any management letters, and communications with Shareholders (including the Directors), and permit the Shareholder or and each of its respective Representatives to examine such documents and make copies thereof, and (iii) any Officers, senior employees, and public accountants of the Company, and afford the Shareholder and each of its respective Representatives the opportunity to discuss and advise on the affairs, finances, and accounts of the Company with such Officers, senior employees, and public accountants (and the Company hereby authorizes said accountants and other Persons to discuss with such Shareholder and its Representatives such affairs, finances, and accounts); in each case, to the extent such information is for a purpose reasonably related to the Shareholder's interest as a Shareholder.

Section 9.03 Income Tax Status. It is the intent of the Company and the Shareholders that the Company shall be treated as "C" corporation for federal, state, and local income tax purposes.

Section 9.04 Tax Returns. At the expense of the Company, the Directors (or any Officer that it may designate pursuant to Section 6.04) shall endeavor to cause the preparation and timely filing (including extensions) of all tax returns required to be filed by the Company pursuant to the Code as well as all other required tax returns in each jurisdiction in which the Company owns property or does business.

Section 9.05 Company Funds. All funds of the Company shall be deposited in its name, or in such name as may be designated by the Directors, in such checking, savings, or other accounts, or held in its name in the form of such other investments as shall be designated by the Directors. The funds of the Company shall not be commingled with the funds of any other Person. All withdrawals of such deposits or liquidations of such investments by the Company shall be made exclusively on the signature or signatures of such Officer or Officers as the Directors may designate.

ARTICLE X

Dissolution and Liquidation

Section 10.01 Events of Dissolution. The Company shall be dissolved and its affairs wound up only on the occurrence of any of the following events:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) An election to dissolve the Company made by the Directors;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) The sale, exchange, involuntary conversion, or other disposition or Transfer of all or substantially all the assets of the Company;

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Passage of ninety (90) consecutive days during which the Company has no Shareholders; or

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The entry of a decree of judicial dissolution under the NRS.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(e) The reduction of sales and/or net profits below a pre-determined level agreed upon, in writing, by all of the Directors prior to the commencement of business. Measurement will be on a cumulative basis but in any event such determination will not be made within the first twelve (12) months of operations.

Section 10.02 Effectiveness of Dissolution. Dissolution of the Company shall be effective on the day on which the event described in Section 10.01 occurs. On the occurrence of an event described in Section 10.01, the Liquidator (or, in the case of a dissolution pursuant to Section 10.01(d), the Persons conducting the winding up of the Company's affairs pursuant to the N) shall commence the wind up of the Company and the distribution of the assets of the Company as provided in Section 10.03 and shall thereafter file articles of dissolution with the Nevada Secretary of State pursuant to the NRS.

Section 10.03 Liquidation. If the Company is dissolved pursuant to Section 10.01, the Company shall be liquidated and its business and affairs wound up in accordance with the NRS and the following provisions:

The Directors shall act as liquidator to wind up the Company (the "Liquidator"). The Liquidator shall have full power and authority to sell, assign, and encumber any or all of the Company's assets and to wind up and liquidate the affairs of the Company in an orderly and business-like manner.

Notice of Liquidation. The Liquidator (or other Persons winding up the affairs of the Company pursuant to Section 10.02) shall give written notice of the commencement of winding up by mail to all known creditors and claimants whose addresses appear on the records of the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Accounting. As promptly as possible after dissolution and again after final liquidation, the Liquidator shall cause a proper accounting to be made by a recognized firm of certified public accountants of the Company's assets, liabilities, and operations through the last day of the calendar month in which the dissolution occurs or the final liquidation is completed, as applicable.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Distribution of Proceeds. The Liquidator shall liquidate the assets of the Company and distribute the proceeds of such liquidation in the following order of priority, unless otherwise required by mandatory provisions of applicable law:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i) First, to the payment of all of the Company's known debts and liabilities (including any debts and liabilities to Shareholders who are creditors, if applicable) and the expenses of liquidation (including sales commissions incident to any sales of assets of the Company);

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii) Second, to the establishment of and additions to reserves that are determined by the Liquidator to be reasonably necessary for any contingent unknown liabilities or obligations of the Company; and

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii) Third, to the Shareholders, on a pro-rata basis, in accordance with the positive balances in their respective Capital Accounts, as determined after taking into account all Capital Account adjustments for the taxable year of the Company during which the liquidation of the Company occurs.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) Discretion of Liquidator. Notwithstanding the provisions of Section 10.03(d) that require the liquidation of the assets of the Company, but subject to the order of priorities set forth in Section 10.03(d), if on dissolution of the Company the Liquidator reasonably determines that an immediate sale of part or all of the Company's assets would be impractical or could cause undue loss to the Shareholders, the Liquidator may defer the liquidation of any assets except those necessary to satisfy Company liabilities and reserves, and may distribute to the Shareholders, in lieu of cash, as tenants in common and in accordance with the provisions of Section 10.03(d), undivided interests in such Company assets as the Liquidator deems not suitable for liquidation. Any such distribution in kind shall be subject to such conditions relating to the disposition and management of such properties as the Liquidator deems reasonable and equitable and to any agreements governing the operating of such properties at such time. For purposes of any such distribution, any property to be distributed will be valued at its Fair Market Value.

Section 10.04 Cancellation of Foreign Qualifications. On completion of the distribution of the assets of the Company as provided in Section 10.03(d) hereof, the Liquidator shall file Articles of Dissolution with the Nevada Secretary of State and shall cause the cancellation of all qualifications and registrations of the Company as a foreign corporation in jurisdictions other than the State of Nevada and shall take such other actions as may be necessary to terminate the Company.

Section 10.05 Survival of Rights, Duties, and Obligations. Dissolution, liquidation, winding up, or termination of the Company for any reason shall not release any party from any Loss that at the time of such dissolution, liquidation, winding up, or termination already had accrued to any other party or thereafter may accrue in respect of any act or omission before such dissolution, liquidation, winding up, or termination. For the avoidance of doubt, none of the foregoing shall replace, diminish, or otherwise adversely affect any Shareholder's right to indemnification pursuant to ARTICLE IX.

Section 10.06 Recourse for Claims. Each Shareholder shall look solely to the assets of the Company for all distributions with respect to the Company, and shall have no recourse therefor (upon dissolution or otherwise) against the Liquidator or any other Shareholder.

ARTICLE XI

Miscellaneous

Section 11.01 Expenses. Except as otherwise expressly provided herein, all costs and expenses, including fees and disbursements of counsel, financial advisors, and accountants, incurred in connection with the preparation and execution of this Agreement, or any amendment or waiver hereof, and the transactions contemplated hereby shall be paid by the party incurring such costs and expenses.

Section 11.02 Further Assurances. In connection with this Agreement and the transactions contemplated hereby, the Company and each Shareholder hereby agrees, at the request of the Company or any other Shareholder, to execute and deliver such additional documents, instruments, conveyances, and assurances and to take such further actions as may be required to carry out the provisions hereof and give effect to the transactions contemplated hereby and to operate the Business in accordance with Applicable Law.

Section 11.03 Confidentiality.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(a) Each Shareholder acknowledges that during the term of this Agreement, it will have access to and become acquainted with trade secrets, proprietary information, and confidential information belonging to the Company and its Affiliates that are not generally known to the public, including, but not limited to, customer information, manufacturing information, regulatory information, financial statements, vendor information, employee information and other information provided pursuant to this Agreement, operating practices and methods, expansion plans, strategic plans, marketing plans, contracts, customer lists, or other business documents that the Company treats as confidential, in any format whatsoever (including oral, written, electronic, or any other form or medium) (collectively, "Confidential Information"). In addition, each Shareholder acknowledges that (i) the Company has invested, and continues to invest, substantial time, expense, and specialized knowledge in developing its Confidential Information, (ii) the Confidential Information provides the Company with a competitive advantage over others in the marketplace, and (iii) the Company would be irreparably harmed if the Confidential Information were disclosed to competitors or made available to the public. Without limiting the applicability of any other agreement to which any Shareholder is subject, no Shareholder shall, directly or indirectly, disclose or use (other than solely for the purposes of such Shareholder monitoring and analyzing its investment in the Company and carrying out its obligations to the Company) including, without limitation, use for personal, commercial, or proprietary advantage or profit, either during its association with the Company or thereafter, any Confidential Information of which such Shareholder is or becomes aware. Each Shareholder in possession of Confidential Information shall take all appropriate steps to safeguard such information and to protect it against disclosure, misuse, espionage, loss, and theft.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(b) Nothing contained in Section 11.03(a) shall prevent any Shareholder from disclosing Confidential Information (i) on the order of any court or administrative agency, (ii) on the request or demand of any regulatory agency or authority having jurisdiction over such Shareholder, (iii) to the extent compelled by legal process or required or requested pursuant to subpoena, interrogatories, or other discovery requests, (iv) to the extent necessary in connection with the exercise of any remedy hereunder, (v) to any other Shareholder, the Directors, or the Company, or (vi) to such Shareholder's Representatives who, in the reasonable judgment of such Shareholder, need to know such Confidential Information and agree to abide by the provisions of this Section 11.03 as if a Shareholder; provided, that in the case of clause (i), (ii), or (iii), such Shareholder shall notify the Company and other Shareholders of the proposed disclosure as far in advance of such disclosure as practicable (but in no event make any such disclosure before notifying the Company and other Shareholders) and use reasonable efforts to ensure that any Confidential Information so disclosed is accorded confidential treatment satisfactory to the Company, when and if available.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(c) The restrictions of Section 11.03(a) shall not apply to Confidential Information that (i) is or becomes generally available to the public other than as a result of a disclosure by a Shareholder in violation of this Agreement, (ii) is or has been independently developed or conceived by such Shareholder without use of Confidential Information, or (iii) becomes available to such Shareholder or any of its Representatives on a non-confidential basis from a source other than the Company, the other Shareholders, or any of their respective Representatives; provided, that such source is not known by the receiving Shareholder to be bound by a confidentiality agreement regarding the Company.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(d) The obligations of each Shareholder under this Section 11.03 shall survive (i) the termination, dissolution, liquidation, and winding up of the Company, (ii) the termination of such Shareholder from the Company in accordance with the provisions of this Agreement and (iii) such Shareholder's Transfer of its Shares.

Section 11.04 Notices. All notices, requests, consents, claims, demands, waivers, and other communications hereunder shall be in writing and shall be deemed to have been given (i) when delivered by hand (with written confirmation of receipt), (ii) when received by the addressee if sent by a nationally recognized overnight courier (receipt requested), (iii) on the date sent by facsimile or email of a PDF document (with confirmation of transmission) if sent during normal business hours of the recipient, and on the next Business Day if sent after normal business hours of the recipient, or (iv) on the third day after the date mailed, by certified or registered mail, return receipt requested, postage prepaid. Such communications must be sent to the respective parties at the following addresses (or at such other address for a party as shall be specified in a notice given in accordance with this Section 11.04).

If to the Company:

Organipure, Inc.

1495 Ridgeview Drive, Suite 230A

Reno, NV 89519

Attention: Gregg W. Koechlein

E-mail: <u>gkoechlein@high-sierra.com</u>

Attention: Sandro Piancone

E-mail: sandro@hempaccoinc.com

with a copies to:

Brunson, Chandler and Jones

175 S. Main Street, 14<sup>th</sup> Floor

Salt Lake City, UT 84111

E-mail: lance@bcjlaw.com

Attention: Lance Brunson, Esq.

If to Managing Shareholder:

and

Gregg W. Koechlein, Esq.

2560 Greensboro Drive

Reno, NV 89509

E-Mail: gkoechlein@synergsm.com

If to HSTI:

High Sierra Technologies, Inc.

1495 Ridgeview Drive, Suite 230A

Reno, NV 89519

E-mail: gkoechlein@high-sierra.com

Attention: Gregg W. Koechlein

with a copy to:

Gregg W. Koechlein, Esq.

2560 Greensboro Drive

Reno, NV 89509

E-Mail: gkoechlein@synergsm.com

If to HCI:

Hempacco Co., Inc.

9925 Airway Road

Sand Diego, CA 92154

E-mail: sandro@hempaccoinc.com

Attention: Sandro Piancone

with a copy to:

Brunson, Chandler and Jones

175 S. Main Street, 14<sup>th</sup> Floor

Salt Lake City, UT 84111

E-mail: lance@bcjlaw.com

Attention: Lance Brunson, Esq.

Section 11.05 Headings. The headings in this Agreement are inserted for convenience or reference only and are in no way intended to describe, interpret, define, or limit the scope, extent, or intent of this Agreement or any provision of this Agreement.

Section 11.06 Severability. If any term or provision of this Agreement is held to be invalid, illegal, or unenforceable under Applicable Law in any jurisdiction, such invalidity, illegality, or unenforceability shall not affect any other term or provision of this Agreement or invalidate or render unenforceable such term or provision in any other jurisdiction. Except as provided in this Agreement, on such determination that any term or other provision is invalid, illegal, or unenforceable, the parties hereto shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in a mutually acceptable manner in order that the transactions contemplated hereby be consummated as originally contemplated to the greatest extent possible.

Section 11.07 Entire Agreement. This Agreement, together with the Articles of Organization and all related Exhibits and Schedules, constitutes the sole and entire agreement of the parties to this Agreement with respect to the subject matter contained herein and therein, and supersedes all prior and contemporaneous understandings, agreements, records, representations, and warranties, both written and oral, whether express or implied, with respect to such subject matter.

Section 11.08 Successors and Assigns. Subject to the restrictions on Transfers set forth herein, this Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their respective heirs, executors, administrators, successors, and permitted assigns. This Agreement may not be assigned by any Shareholder except as permitted by this Agreement and any assignment in violation of this Agreement shall be null and void *ab initio*.

Section 11.09 No Third-Party Beneficiaries. Except as provided in ARTICLE VIII, which shall be for the benefit of and enforceable by Covered Persons as described therein, this Agreement is for the sole benefit of the parties hereto (and their respective heirs, executors, administrators, successors, and permitted assigns) and nothing herein, express or implied, is intended to or shall confer upon any other Person, including any creditor of the Company, any legal or equitable right, benefit, or remedy of any nature whatsoever under or by reason of this Agreement.

Section 11.10 Amendment. Except as otherwise provided by this Agreement, no provision of this Agreement may be amended or modified except by an instrument in writing executed by all of the Shareholders. Any such written amendment or modification will be binding upon the Company and each Shareholder. Notwithstanding the foregoing, amendments to the Shareholders Schedule following any new issuance, redemption, repurchase, or Transfer of Shares in accordance with this Agreement may be made by the Directors without the consent of or execution by the Shareholders.

Section 11.11 Waiver. No waiver by any party of any of the provisions hereof shall be effective unless explicitly set forth in writing and signed by the party so waiving. No waiver by any party shall operate or be construed as a waiver in respect of any failure, breach, or default not expressly identified by such written waiver, whether of a similar or different character, and whether occurring before or after that waiver. No failure to exercise, or delay in exercising, any right, remedy, power, or privilege arising from this Agreement shall operate or be construed as a waiver thereof, nor shall any single or partial exercise of any right, remedy, power, or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power, or privilege. For the avoidance of doubt, nothing contained in this Section 11.11 shall diminish any of the explicit and implicit waivers described in this Agreement, including in hereof.

Section 11.12 Governing Law. All issues and questions concerning the application, construction, validity, interpretation, and enforcement of this Agreement shall be governed by and construed in accordance with the internal laws of the State of Nevada, without giving effect to any choice or conflict of law provision or rule (whether of the State of Nevada or any other jurisdiction) that would cause the application of laws of any jurisdiction other than those of the State of Nevada.

Section 11.13 Submission to Jurisdiction. The parties hereby agree that any suit, action, or proceeding seeking to enforce any provision of, or based on any matter arising out of or in connection with, this Agreement or the transactions contemplated hereby, whether in contract, tort, or otherwise, shall be brought: (1) in the case of HSTI being the Plaintiff, then in the United States District Court for the State of Nevada, Northern District or, the courts of the State of Nevada sitting in Washoe County and any appellate court from any thereof using the Laws of the State of Nevada without regard to its conflicts of laws principals, and that any cause of action arising out of this Agreement brought by HSTI shall be deemed to have arisen from a transaction of business in the State of Nevada or (2) in the case of HCI being the Plaintiff, then in the United States District Court for the State of California, Southern District or, the courts of the State of California sitting in San Diego County and any appellate court from any thereof using the Laws of the State of California without regard to its conflicts of laws principals, and that any cause of action arising out of this Agreement brought by HCI shall be deemed to have arisen from a transaction of business in the State of California. Each of the parties hereby irrevocably consents to the jurisdiction of such courts in any such suit, action, or proceeding and irrevocably waives, to the fullest extent permitted by law, any objection that it may now or hereafter have to the laying of the venue of any such suit, action, or proceeding in any such court or that any such suit, action, or proceeding that is brought in any such court has been brought in is an inconvenient forum. Service of process, summons, notice, or other document by registered mail to the address set forth in Section 11.04 shall be effective service of process for any suit, action, or other proceeding brought in any such court.

Section 11.14 Equitable Remedies. Each party hereto acknowledges that a breach or threatened breach by such party of any of its obligations under this Agreement would give rise to irreparable harm to the other parties, for which monetary damages would not be an adequate remedy, and hereby agrees that in the event of a breach or a threatened breach by such party of any such obligations, each of the other parties hereto shall, in addition to any and all other rights and remedies that may be available to them in respect of such breach, be entitled to equitable relief, including a temporary restraining order, an injunction, specific performance, and any other relief that may be available from a court of competent jurisdiction (without any requirement to post bond).

Section 11.15 Attorneys' Fees. If any party hereto institutes any legal suit, action, or proceeding, including arbitration, against another party in respect of a matter arising out of or relating to this Agreement, the prevailing party in the suit, action, or proceeding shall be entitled to receive, in addition to all other damages to which it may be entitled, the costs incurred by such party in conducting the suit, action, or proceeding, including reasonable attorneys' fees and expenses and court costs.

Section 11.16 Remedies Cumulative. The rights and remedies under this Agreement are cumulative and are in addition to and not in substitution for any other rights and remedies available at law or in equity or otherwise, except to the extent expressly provided herein to the contrary.

Section 11.17 Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, but all of which together shall be deemed to be one and the same agreement. A signed copy of this Agreement delivered by facsimile, email, or other means of Electronic Transmission shall be deemed to have the same legal effect as delivery of an original signed copy of this Agreement.

Section 11.18 Conflicts. In the event of any conflict between this Agreement and the By-Laws of the Company, the terms and provisions of this Agreement shall be deemed to be controlling.

Section 11.19 First Refusal Rights. In the event that either party to this Agreement receives an offer to purchase all, or the majority, of its shares of common stock, then the other party shall have a right of first refusal to match any such offer. The party receiving any such offer shall notify the other party within ten (10) business days of its receipt of any such offer. The other party shall then have twenty (20) business days following the receipt of such notice to indicate whether or not it intends to exercise its First Refusal Rights.

IN WITNESS WHEREOF, the Company and the Shareholders have signed this Joint Venture Agreement of Organipure, Inc. as of the Effective Date.

---

| | |
|:---|:---|
| COMPANY: | COMPANY: |
| Organipure, Inc.,<br> a Nevada Corporation | Organipure, Inc.,<br> a Nevada Corporation |
| By: |  |
| Name: | Vincent C. Lombardi |
| Title: | Co-President |
| By: | */s/ Sandro Piacone* |
| Name: | Sando Piancone |
| Title: | Co-President |
| SHAREHOLDERS: | SHAREHOLDERS: |
| High Sierra Technologies, Inc.<br> A Nevada Corporation | High Sierra Technologies, Inc.<br> A Nevada Corporation |
| By: |  |
| Name: | Vincent C. Lombardi |
| Title: | President |
| Hempacco Co., Inc.<br> A Nevada Corporation | Hempacco Co., Inc.<br> A Nevada Corporation |
| By: | */s/ Sandro Piancone* |
| Name: | Sandro Piancone |
| Title: | President |

---

 <u>SCHEDULE A</u> 

SHAREHOLDERS SCHEDULE

---

| | | |
|:---|:---|:---|
| Shareholder Name | Capital Contribution | Percentage of Shares |
| <br> Hempacco Co., Inc. | <br> Initial cash of $1,000.00 and subsequent contributions as needed, IP Licensing, Services and Know-How | <br> 50% |
| <br> High Sierra Technologies, Inc. | <br> Initial cash of $1,000.00 and subsequent contributions as needed, IP Licensing, Services and Know-How | <br> 50% |

---

## Exhibit 23.1

**EXHIBIT 23.1**

**Consent of Independent Registered Public Accounting Firm**

We consent to the use, in this Registration Statement on Form S-1, of our report dated March 23, 2022 related to the consolidated financial statements of Hempacco Co, Inc. as of December 31, 2021 and 2020 and for the years then ended, which includes an explanatory paragraph regarding substantial doubt about Hempacco Co, Inc.'s ability to continue as a going concern. We also consent to the reference to us in the "Experts" section of the Registration Statement.

/s/ dbb*mckennon*

San Diego, California

February 3, 2023

## Exhibit 99.2

**EXHIBIT 99.2**

**<u>SETTLEMENT AGREEMENT AND MUTUAL RELEASE</u>**

This **SETTLEMENT AGREEMENT AND MUTUAL RELEASE** ("<u>Agreement</u>"), is entered into by and among **Titan General Agency Ltd.** ("<u>Titan</u>"), on the one hand, and **Hempacco Co., Inc.** ("<u>HPCO</u>"), on the other hand, who enter into the Agreement effective as of September 6, 2022 (the "<u>Effective Date</u>"). The Parties to this Agreement may be referred to collectively as the "Parties" or individually as a "Party."

**I. <u>RECITALS</u>**

**WHEREAS,** Titan and HPCO entered into that certain purchase finance agreement dated December 3, 2019 (the "<u>Finance Agreement</u>"), pursuant to which HPCO acquired approximately $1,500,000 of cigarette manufacturing machinery and equipment and HPCO agreed to pay Titan $1,500,000 for such equipment within 18 months thereof, and pursuant to which approximately $1,450,000 is due to Titan as of the Effective Date.

**WHEREAS**, Titan has demanded payment in full under the Finance Agreement, and the Parties now desire to settle their dispute regarding the Finance Agreement on the terms and conditions set forth herein.

**NOW, THEREFORE**, for and in consideration of the foregoing recitals, the mutual covenants and agreements of the Parties, and other good and valuable consideration, the parties agree to settle the Finance Agreement as follows:

**II. <u>TERMS OF AGREEMENT</u>**

The Parties hereby agree to the following terms and conditions and further agree to perform any and all acts and to execute any and all documents reasonably necessary or appropriate to implement this Agreement:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A. **<u>Cash Payment.</u>** HPCO shall send $250,000 (the "<u>Cash Payment</u>") in immediately available funds by wire transfer by the later of (i) the close of business on September 6, 2022, (ii) the close of business on the business day following the Effective Date. Such wire shall be sent to the following bank account information:

[ADD TITAN WIRE INSTRUCTIONS]

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B. **<u>Stock Payment.</u>** HPCO shall issue to Titan 266,667 shares of its common stock. Such shares shall be issued pursuant to the "private offering" exemptions from the registration requirements of the Securities Act of 1933, as amended (the "<u>Securities Act</u>"), and in connection therewith, Titan represents that it is an "accredited investor" as defined in Rule 501 promulgated under Regulation D, and acknowledges that the shares issued to it will be issued with standard Securities Act restrictive legend.

Page 1 of 5

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;C. **<u>Mutual Releases.</u>** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. Except as otherwise provided for herein, Titan hereby forever releases, acquits and discharges HPCO and its past and present subsidiary entities, affiliates, joint venturers, predecessors, successors, assigns, officers, directors, members, managers (in their individual and representative capacities), agents, attorneys, employees and any other legal representatives of and from all claims, losses, causes of action, costs, expenses, attorneys' fees, liabilities, indemnities, subrogation (contractual or equitable), duties, and obligations of any nature whatsoever whether known or unknown, fixed or contingent, accrued or not yet accrued, matured or not yet matured, anticipated or unanticipated, asserted or unasserted, arising from or in any manner relating or pertaining to the subject matter of this Agreement or the Finance Agreement.

**2**. Except as otherwise provided for herein, HPCO hereby and forever releases, acquits and discharges Titan, as well as its past and present subsidiary entities, affiliates, joint venturers, predecessors, successors, assigns, officers, directors, members, managers (in their individual and representative capacities), agents, attorneys, employees and any other legal representatives of and from all claims, losses, causes of action, costs, expenses, attorneys' fees, liabilities, indemnities, subrogation (contractual or equitable), duties, and obligations of any nature whatsoever whether known or unknown, fixed or contingent, accrued or not yet accrued, matured or not yet matured, anticipated or unanticipated, asserted or unasserted, arising from or in any manner relating or pertaining to the subject matter of this Agreement or the Finance Agreement.

**III. <u>GENERAL PROVISIONS</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A. **<u>No Assignment.</u>** The Parties warrant and represent that they have not made any assignment or transfer of any right, claim, demand, cause of action, or other matter covered by the releases set forth in this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B. **<u>Attorneys' Fees and Costs.</u>** Each Party shall bear all of its own costs, fees and expenses, including, without limitation, legal and expert fees incurred in connection with the Finance Agreement and this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;C. **<u>Reimbursement for Fees and Costs to Enforce Agreement.</u>** If there is any legal and/or equitable action or proceeding, including any bankruptcy proceeding or any mediation or arbitration proceeding, to enforce or interpret any provision of this Agreement or to protect or establish any right or remedy of any Party, the unsuccessful Party to such action or proceeding, whether such action or proceeding is settled or prosecuted to final judgment, shall pay to the prevailing Party as finally determined, all costs and expenses, including reasonable attorneys' fees and costs, incurred by such prevailing Party in such action or proceeding. The prevailing Party's rights under this section shall not merge into any judgment and shall survive until all such fees and costs have been paid.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;D. **<u>No Construction of Agreement Against Any Party.</u>** This Agreement was negotiated at arm's length and entered into freely by the Parties with the advice of counsel. Each Party has cooperated in the drafting and preparation of this Agreement. Hence, in any construction to be made of this Agreement, it shall not be construed against any Party on the basis such Party drafted this Agreement or any provision thereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;E. **<u>Scope of Promises, Representations, and Inducements.</u>** The Parties acknowledge, warrant and represent that no promises, representations or inducements, except as set forth in this Agreement, have been offered or made by any of the Parties to secure the execution of the releases above or this Agreement, and that the releases and this Agreement are executed without reliance on any statements or any representations not contained herein.

Page 2 of 5

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;F. **<u>Voluntary Agreement.</u>** Each of the Parties acknowledges that it voluntarily executed this Agreement of its own free will and under no threat, menace, coercion, or duress, whether economic or physical, from any other Party, and with full knowledge of the significance and legal effect. Each of the Parties certifies that it is voluntarily entering into this Agreement in good faith based solely and completely upon its own judgment and upon the advice and counsel of its attorneys following its good faith assessment of the matters addressed hereby, and each Party has secured independent legal advice concerning every aspect of this Agreement and the rights and liabilities each is hereby relinquishing or making.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;G. **<u>Survival.</u>** The Parties hereby agree that the provisions of this Agreement, including, without limitation, the representations, warranties, covenants and releases made herein, shall survive the execution of this Agreement and the performance by the Parties of their respective obligations under this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;H. **<u>Severability.</u>** Any part, provision, representation, or warranty of this Agreement that is prohibited or unenforceable, or is held by a court of competent jurisdiction to be void or unenforceable, in any jurisdiction shall, as to such jurisdiction, be ineffective to the provisions, representations, or warranties herein, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. To the extent permitted by applicable law, the Parties hereby knowingly, voluntarily, and intelligently waive any provision of law that prohibits or renders void or unenforceable any part, provision, representation or warranty hereof.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;I. **<u>Entire Agreement and Choice of Law.</u>** This Agreement constitutes the entire agreement of the Parties with respect to the settlement of the Finance Agreement and supersedes all prior and contemporaneous agreements and understandings relating to the subject matter of this Agreement and any and all prior correspondence, conversations, or memoranda are merged into this Agreement and hereby replaced. Any other promise or inducement, representation, oral or written, not set forth in this Agreement shall have no force or effect. This Agreement shall be construed under the laws of the State of Nevada, without regard to its choice of law rules. Venue for any dispute arising under the terms of this Agreement shall be in the Eighth Judicial District Court in and for the County of Clark, State of Nevada, or if appropriate, the United States District Court for the District of Nevada, and the Parties all consent to the exclusive jurisdiction of such courts, and waive any arguments of an inconvenient forum.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;J. **<u>Successors and Assigns.</u>** This Agreement shall be binding upon and inure to the benefit of the Parties, and each of them, their successors, assigns, personal representatives, agents, employees, parents, affiliates and each of their respective directors, officers, members, managers and servants.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;K. **<u>Modifications.</u>** No part or provision of this Agreement may be changed, modified, waived, discharged, or terminated except by an instrument in writing signed by the Party against whom enforcement of such change, modification, waiver, discharge, or termination is sought. The failure of a Party to seek redress for violation of, or to insist upon strict performance of, any provision of this Agreement shall not be a waiver of that provision by that Party or estop that Party from asserting fully any and all of its rights under this Agreement.

Page 3 of 5

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;L. **<u>Waiver.</u>** No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provision, whether or not similar, nor shall any waiver constitute a continuing waiver. No waiver shall be binding unless executed in writing by the Party making the waiver.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;M. **<u>Authorization to Sign.</u>** Each of the Parties hereby represents and warrants that the individual signing this Agreement on its behalf is duly authorized to enter into this Agreement and to execute and legally bind such Party to it.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;N. **<u>Execution in Counterparts and Facsimile Signatures.</u>** This Agreement may be executed in counterparts, each of which shall constitute an original and all of which, when taken together, shall constitute one and the same instrument. Facsimile signatures and/or signatures provided through electronic transmission shall be given the same force and effect as originals.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;O. **<u>No Third Party Rights.</u>** This Agreement is intended to confer rights and benefits on the Parties as identified herein, but does not allow any of the Parties to bind any of the other Parties to anything not explicitly contained in this Agreement. Except as otherwise expressly provided herein, no person or entity other than the Parties shall have any rights under this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;P. **<u>Number and Gender.</u>** Whenever required by the context of this Agreement, the singular shall include the plural and the masculine shall include the feminine or neuter, as the case may be, and vice versa.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Q. **<u>Headings.</u>** The captions or headings of the Sections or Paragraphs of this Agreement are for convenience of reference only and in no way define, limit or affect the scope or substance of any Section or Paragraph of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;R. **<u>Confidentiality.</u>**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1. The Parties acknowledge and agree that the Agreement (including its specific terms) and the payment of the Payment on behalf of the Settling Defendants, were made and entered into in strict confidence and must remain confidential. The Parties on behalf of themselves, their employees, agents and attorneys, except as specifically permitted by this Agreement, will keep the terms of this Agreement (collectively, "<u>Confidential Material</u>") confidential and will not admit, discuss, announce, whether in writing or orally, to any other person or entity directly or indirectly, unless required to do so by law or as necessary to effectuate the terms of this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2. Notwithstanding the foregoing, a Party, may disclose generally that they have entered into an agreement settling the Finance Agreement and, further, may disclose terms of this Agreement upon any of the following: (i) the express written consent of each Party to this Agreement; (ii) as required by an order of a court of competent jurisdiction; or (iii) to the extent disclosure is customary for the purposes of tax, legal or regulatory reporting, for the purposes of obtaining or maintaining insurance coverage, or for the purpose of enforcing or remedying a breach of any term or provision of this Agreement. The representations and covenants in this paragraph are material to the Parties to this Agreement.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3. If any Party is ever compelled, or is sought to be compelled, to disclose the terms of this Agreement to any third parties other than those excepted above, such party agrees to provide sufficient notice to the other Parties immediately by electronic mail and overnight delivery to all counsel of record for the Parties, in order to permit any party entitled to receive notice under this Agreement the opportunity to object and, if necessary, to seek Court protection to preserve the confidentiality of the Confidential Material.

**REMAINDER OF THIS PAGE**

**INTENTIONALLY LEFT BLANK**

Page 4 of 5

**IN WITNESS WHEREOF**, the undersigned Parties have duly executed this Agreement to be effective as of the Effective Date.

**BY TITAN:**

READ AND SIGNED THIS <u>6</u> day of September, 2022.

---

| | |
|:---|:---|
| **TITAN GENERAL AGENCY LTD.:** | **TITAN GENERAL AGENCY LTD.:** |
| By: | /s/ John Tomlinson |
| Name:  | <u>John Tomlinson</u> |
| Title: | <u>Director</u> |

---

**BY HPCO:**

READ AND SIGNED THIS <u>6</u> day of September, 2022.

---

| | |
|:---|:---|
| **HEMPACCO CO., INC.:** | **HEMPACCO CO., INC.:** |
| By: | /s/ Sandro Piancone |
| Name:  | <u>Sandro Piancone</u> |
| Title: | <u>CEO</u> |

---

<br> <u>Page 5 of 5</u>

## Ex-Filing

**EXHIBIT 107**

**Calculation of Filing Fee Tables**

**<u>Form S-1</u>**

(Form Type)

**<u>Hempacco Co., Inc.</u>**

(Exact Name of Registrant as Specified in its Charter)

<u>Table 1: Newly Registered and Carry Forward Securities</u>

---

| | | | | | | | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|:---|
|  | **Security Type** | **Security Class Title** | **Fee Calculation or Carry Forward Rule** | **Amount Registered**  | **Proposed Maximum Offering Price Per Share** | **Maximum Aggregate Offering Price (1)(2)** | **Fee Rate** | **Amount of Registration Fee (4)** | **Carry Forward Form Type** | **Carry Forward File Number** | **Carry Forward Initial effective date** | **Filing Fee Previously Paid In Connection with Unsold Securities to be Carried Forward** |
| **Newly Registered Securities** | **Newly Registered Securities** | **Newly Registered Securities** | **Newly Registered Securities** | **Newly Registered Securities** | **Newly Registered Securities** | **Newly Registered Securities** | **Newly Registered Securities** | **Newly Registered Securities** | **Newly Registered Securities** | **Newly Registered Securities** | **Newly Registered Securities** | **Newly Registered Securities** |
| Fees to be paid | Equity | Common Stock, par value $0.001 per share (3) | 457(o) |  |  | $6037500 | $110.20 per $1,000,000 | $665.33 |  |  |  |  |
|  | Equity | Representatives' Warrants (4) | 457(g) |  |  | - | - | - |  |  |  |  |
|  | Equity | Common stock, par value $0.001 per share (Representatives' Warrant Shares) (3) (5) | 457(g) |  |  | $422625 | $110.20 per $1,000,000 | $46.57 |  |  |  |  |
| Fees previously paid |  |  |  |  |  |  |  |  |  |  |  |  |
| **Carry Forward Securities** | **Carry Forward Securities** | **Carry Forward Securities** | **Carry Forward Securities** | **Carry Forward Securities** | **Carry Forward Securities** | **Carry Forward Securities** | **Carry Forward Securities** | **Carry Forward Securities** | **Carry Forward Securities** | **Carry Forward Securities** | **Carry Forward Securities** | **Carry Forward Securities** |
| Carry Forward Securities |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Total Offering Amounts | Total Offering Amounts | Total Offering Amounts | Total Offering Amounts |  |  |  | $711.91 |  |  |  |  |
|  | Total Fees Previously Paid | Total Fees Previously Paid | Total Fees Previously Paid | Total Fees Previously Paid |  |  |  | $0 |  |  |  |  |
|  | Total Fee Offsets | Total Fee Offsets | Total Fee Offsets | Total Fee Offsets |  |  |  | $0 |  |  |  |  |
|  | Net Fee Due | Net Fee Due | Net Fee Due | Net Fee Due |  |  |  | $711.91 |  |  |  |  |

---

(1) Estimated solely for the purpose of computing the amount of the registration fee pursuant to Rule 457(o) under the Securities Act of 1933, as amended (the "Securities Act").

(2) Includes initial public offering price of shares that the underwriters have the option to purchase to cover over-allotments, if any.

(3) Pursuant to Rule 416 of the Securities Act, the shares of common stock registered hereby also includes an indeterminable number of additional shares of common stock as may from time to time become issuable by reason of stock splits, stock dividends, recapitalizations or other similar transactions.

(4) No fee required pursuant to Rule 457(g) under the Securities Act.

(5) Estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(g) under the Securities Act. The Representatives' Warrants are exercisable for a number of shares equal to 7% of the shares of common stock offered hereby at a per share exercise price equal to 100% of the public offering price per share. As estimated solely for the purpose of calculating the registration fee pursuant to Rule 457(g) under the Securities Act, the proposed maximum aggregate offering price of the Representatives' Warrants (including the over-allotment) is $422,625, which is equal to 100% of $422,625 (7% of $6,037,500).