Document:

ROCKY MOUNTAIN
HIGH BRANDS, INC.

6 MONTH 6% CONVERTIBLE PROMISSORY NOTE

 

$79,000.00

("Principal")

May 19, 2017

("Effective Date"}

 

This
Convertible Promissory Note, dated May 19, 2017, (the "Note"), is by and
between ROCKY MOUNTAIN HIGH BRANDS,
INC., a Nevada corporation (the "Company"), its successors and assigns, and LSW
Holdings, LLC, to which
the Company is issuing this Note as ("Holder''). This Note is being issued pursuant to exemptions from registration under
the Securities Act of 1933 of the United States, as amended.

 

1.            
PRINCIPAL, INTEREST, MATURITY DATE. In consideration
of complete and total satisfaction of a prior unsecured, undocumented loan to the Company in the same amount and effective the
same date as this convertible promissory note and without further recourse for that loan other than the terms of this note, satisfying
and superseding all obligations of the prior debt, The Company, its successors and assigns, hereby promises to pay to the Holder,
or its successors or assigns, in immediately available funds, the total principal sum of SEVENTY NINE THOUSAND DOLLARS ($79,000.00
U.S.) under the terms and conditions of this Note. The principal hereof and any unpaid and continuing to accrue interest
thereon shall be due and payable to the Holder (unless such payment date is accelerated as provided in Section 8 hereof) not later
than six months from the Effective Date, or November 19, 2017 (the "Maturity
Date"). Payment of all amounts due hereunder shall be made at the address of the Holder provided for in Section
10 hereof. Interest on the unpaid principal balance of this Note shall accrue from the above date first written and shall continue
to accrue until all unpaid principal and interest is paid in full. Interest shall be calculated at the simple interest rate of
six percent (6%) per annum. Unless Holder of the Note elects to
convert the note to stock, the Company shall have effectively received a CALL notice, requiring the Company to pay Holder all unpaid
principal and interest upon the maturity of this note.

 

2.                 
PREPAYMENT. The Company may, at its
option, at any time and from time to time, prepay all or any part of the principal balance of this Note (the "Prepayment"
or "Prepayments") without penalty or premium, provided that concurrently with each such Prepayment the Company shall
pay accrued interest on the principal, if any.

 

3.            
RENEWAL. The Company may renew this Note upon
not less than thirty {30) days advance written notice to the Holder, wherein the granting of such renewal shall be at the sole
option and discretion of the Holder.

 

4.            TRANSFERABILITY.
This Note shall not be transferred, pledged, hypothecated, or assigned by the Company without the express written consent of
the Holder. In the event any third party acquires a controlling interest in the Company or acquires substantially all of the
assets of the Company (a "Reorganization Event"), this Note will survive and become an obligation of the party that
a quires such controlling interest or assets. In the event of a Reorganization Event the Company agrees to make the party
that acquires such controlling interest or assets, aware of
the terms of this Section and this Note. This Note, in whole or in part, may be transferred, pledged, hypothecated, or assigned
by the Holder in its sole option and discretion, the ''Transfer'', and all rights to the Conversion of this Note (as hereinafter
defined), shall likewise be transferred, pledged, hypothecated, or assigned, in whole or in part, by the Holder in its sole option
and discretion upon such Transfer.

 

    	 	1	 

    	 

    

 

 

		5.	CONVERSION OF PROMISSORY NOTE.

 

(a)                
Conversion Rights· Conversion Dates· Conversion Price. The Holder shall
provide the Company with written notice of any Conversion (the "Conversion Notice") within five

(5)
business days of the date of Holder's verbal or written advice to the Company that the Holder is executing said Conversion (the
"Conversion Date"), in a form similar or identical to the attached Exhibit A. The Company agrees to execute any
Conversion requested by the Holder within the terms and conditions of the following Section 5 (b), "Method of Conversion".
The Holder may continue to request conversion of the outstanding principal and interest of the Note until all outstanding principal
and interest of this Note is paid in full, including any additional amounts due under Default or an Event of Default. Any amount
so converted will be converted into common stock at a conversion price per share of 50% of the average of the 3 lowest closing
bid prices of the Common Stock of the Company during the 10 trading days prior to the conversion. USD (the "Conversion
Price").

 

		(b)	Method of Conversion.

(i)           
Notwithstanding anything to the contrary set forth herein, upon Conversion of this Note
in accordance with the terms hereof, the Holder shall not be required to physically surrender this Note to the Company unless the
entire unpaid principal and interest of this Note is so converted.

 

(ii)          
The Company shall not be required to pay any tax which may be payable in respect of any
transfer involved in the issuance and delivery of shares of common stock or other securities or property on conversion of this
Note in a name other than that of the Holder (or its street address), and the Company shall not be required to issue or deliver
any such shares or other securities or property unless and until the person or persons (other than the Holder or the custodian
in whose street name such shares are to be held for the Holder's account) requesting the issuance thereof, shall have paid to the
Company the amount of any such tax or shall have established to the satisfaction of the Company that such tax has been paid.

 

		(iii)	The Conversion Shares are to be issued
by the Company's transfer agent via express courier to the Holder within seven (7) business days from the Company's receipt of
the Conversion Notice (the "Delivery Date"). Upon receipt of the Conversion Notice, the Company will immediately issue
an instruction letter with all supporting documentation, as required by law, to facilitate the issuance of the Conversion Shares
by the Delivery Date. The Company willbear all costs related to the issuance of the Conversion Shares, including all costs of obtaining
an attorney's opinion letter regarding the Conversion, and the overnight delivery of the Conversion Shares, and shall maintain adequate authorized capital stock, in
type and quantity, at all times until this Note is paid in full to, or fully converted by, the Holder, in order to facilitate the
terms and conditions of this Section. Any failure of the Company to comply with the provisions of this paragraph shall be deemed
by the Holder an Event of Default under this Note.

 

    	 	2	 

    	 

    

	 	(iv)	All Conversion Shares to be issued are to be fully-paid, non-assessable, and lawfully issued by the Company. The
Conversion Shares are to be freely transferrable on the books and records of the Company as and to the extent provided in this
Note and applicable law.

6.                 
CONVERSION LIMITATION. Notwithstanding Section
5 above, neither the Holder nor the Company may convert any outstanding amounts due under this Note if at the time of such conversion
the amount of common stock issued for the conversion, when added to other shares of Company common stock owned by the Holder or
which can be acquired by Holder upon exercise or conversion of any other instrument, would cause the Holder to own more than four
and nine-tenths percent {4.99%) of the Company's outstanding common stock. The restriction described in this paragraph may be revoked
upon sixty-one (61) days prior notice from Holder to the Company.

 

7.                
DEFAULT. The occurrence of any one of the
following events shall constitute a Default or an Event of Default:

 

(a)               
The non-payment, when due or not later than the Maturity Date, of any principal or interest pursuant to this Note;

 

(b)                The
material breach of any representation or warranty in this Note, or the terms and conditions of any Section of this Note,
including, but not limited to, Section 4, Section 6 or Section 10. In the event the Holder becomes aware of a breach of this
Section ll{b), the absolute determination of the existence of such breach being in the sole judgment of the Holder,
the Holder shall notify the Company in writing of such breach
and the Company shall have five business days after notice to cure such breach;

 

(c)               
The commencement against the Company of any proceeding relating to the Company under any bankruptcy, reorganization,
arrangement, insolvency, adjustment of debt, receivership, dissolution or liquidation law or statute of any jurisdiction, whether
now or hereafter in effect, provided, however, that the commencement of such a proceeding shall not constitute an Event of Default
unless the Company consents to the same or admits in writing the material allegations of same, or said proceeding shall remain
undismissed for 20 days; or the issuance of any order, judgment or decree for the appointment of a receiver or trustee for the
Company or for all or a substantial part of the property of the Company, which order, judgment or decree remains undismissed for
20 days; or a warrant of attachment, execution, or similar process shall be issued against any substantial part of the property
of the Company.

 

Upon the occurrence of any
Default or Event of Default, the Holder, may, by written notice to the Company, declare all or any portion of the unpaid
principal amount due to Holder, together with all accrued interest thereon, immediately due and payable (the thirty (30) day
notice period in Section 1, above, will not be applicable in the case of an Event of Default), in which event it shall
immediately be and become due and payable; provided that upon the occurrence of an Event of Default as set forth in paragraph
(d) or paragraph (e) hereof, all or any portion of the unpaid principal amount due to Holder, together with all accrued
interest thereon, shall immediately become due and payable without any such notice.

 

    	 	3	 

    	 

    

 

 

 

Upon
the occurrence of any Default or Event of Default, the Holder at its sole discretion may elect to immediately, or at any time,
convert the outstanding principal amount of this Note, or any portion of the principal amount hereof, and any accrued interest,
in whole or in part, into shares of the common stock of theCompany.

 

8.                 
NOTICES.
Notices to be given hereunder shall be in writing and shall be deemed to have been sufficiently given if delivered personally or
sent by overnight courier, or by facsimile or other electronic transmission (e.g., email), return receipt/or confirmation of receipt
requested. Notice shall be deemed to have been received on the date and time of personal or overnight delivery or electronic transmission,
if received during normal business hours of the recipient; if not, then on the next business day.

 

Notices
to the Company shall be sent to:

ROCKY MOUNTAIN
HIGH BRANDS, INC.

9101 LBJ Freeway, Suite 200

Dallas, TX 75243

ATTN: Michael R. Welch

 

 

 Notices
to the Holder shall be sent to:

LSW HOLDINGS, LLC

c/o
Lily Li 4858 Route 32

Catskill, NY 12414

 

 

    	 	4	 

    	 

    

 

9.
REPRESENTATIONS AND WARRANTIES.The Company hereby makes the following representations and warranties to the
Holder:

 

(a)                
Organization. Good Standing and Power. The Company is a corporation duly incorporated, validly existing and
in good standing under the laws of the State of Nevada and has the requisite corporate power to own, lease and operate its properties
and assets and to conduct its business as it is now being conducted.

 

(b)                
Authorization· Enforcement. The Company has the requisite corporate power and authority to enter into
and perform this Note and to issue and sell this Note. The execution, delivery and performance of this Note by the Company, and
the consummation by it of the Transactions contemplated hereby, have been duly and validly authorized by all necessary corporate
action. This Note, when executed and delivered, will constitute a valid and binding obligation of the Company enforceable against
the Company in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization,
moratorium, liquidation, conservatorship, receivership or similar laws relating to, or affecting generally the enforcement of,
creditor's rights and remedies or by other equitable principles of general application.

 

10.       
REPRESENTATIONS AND WARRANTIES OF
THE HOLDER. The Holder hereby represents and warrants to the Company that:

 

(a)                
the Holder is an "accredited investor'' as such term is defined in Rule 501 of Regulation D promulgated under
the United States Securities Act of 1933, as amended, and the securities to be acquired by it upon Conversion of the Note (the
"Securities") will be acquired for its own account and, as of the date hereof, not with a view toward, or for sale in
connection with, any distribution thereof except in compliance with applicable United States federal and state securities law;
provided that the disposition of the Holder's property shall at all times be and remain within its control;

 

		(b)	the Holder represents that (I) it is not in fact acting only as agent for another Holder

(ii) that it is not
a financial institution or other institutional investor, and (iii) it is acting for its own account or as a bona fide trustee for
a trust organized and existing other than for the purpose of acquiring the Securities;

 

11.         GOVERNING
LAW. THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS APPLICABLE TO CONTRACTS MADE AND
TO BE PERFORMED ENTIRELY THEREIN, WITHOUT GIVING EFFECT TO THE RULES OR PRINCIPLES OF CONFLICTS OF LAW.

 

12.          
ATTORNEYS FEES.
In the event the Holder hereof shall refer this Note to an attorney to enforce the terms hereof, the Company agrees
to pay all the costs and expenses incurred in attempting or effecting the enforcement of the Holder's rights, whether or not suit
is instituted, including reasonable attorney's and paralegals' fees and costs through and Including all
trial and appellate
levels and post-judgment
proceedings and enforcements.

 

    	 	5	 

    	 

    

 

 

 

13.         
CONFORMITY WITH LAW.
It is the intention of the Company and of the Holder to conform strictly to applicable usury and similar laws. Accordingly, notwithstanding
anything to the contrary in this Note, it is agreed that the aggregate of all charges
which constitute interest under applicable usury and similar laws that are contracted for, chargeable or receivable under or in
respect of this Note, shall under no
circumstances exceed the maximum amount of interest permitted by such laws, and any excess, whether occasioned by acceleration
or maturity of this Note or otherwise, shall be canceled automatically,
and if theretofore paid, shall be either refunded to the Company or credited
on the principal amount of this Note.

 

14.          
WAIVERS. All
waivers must be in writing by the Holder. Any waiver or failure to enforce any provision
of this Note on one occasion will not be deemed a waiver of any other provision or of such provision on any other occasion.

 

15.          
HEADINGS.
The headings in this Note are for convenience and are not to be used in interpreting this Note.

 

16.          
COUNTERPARTS . This
Note may be executed in any number of counterparts, each of which shall be an original, but all
of which together shall constitute one instrument. The parties hereto agree that this Note,
agreements ancillary to it, and related documents to be entered into in connection with this Note will be considered signed
when the signature of a party is delivered by facsimile transmission, or an electronic copy of this Note is
delivered bearing electronic signatures of the parties thereto. Such facsimile or electronic signature shall be treated
in all respects as having the same effect as an original signature.

 

17.          
FURTHER ASSURANCES. The
Company, its officers, directors and majority shareholders hereto shall cooperate with one another at reasonable times and on
reasonable conditions and shall promptly execute and deliver any and all instruments
and documents requested by the Holder as may be reasonably necessary in order to fully carry out the intent and purposes of this
Note as contemplated by the Holder at any time prior to full repayment of the principal and interest due under this Note.

 

18.        
AUTHORITY TO BIND. A responsible
officer of the Company has read and understands the contents of this Note and is empowered
and duly authorized on behalf of the Company and its Board of Directors to execute it,
and bind the Company to it.

 

IN WITNESS
WHEREOF, the below parties have signed this Note as of the Effective Date.

 

"Company"

 

ROCKY MOUNTAIN HIGH
BRANDS, IN C.

a Nevada corporation

 

 

By:
                                         /s/ Michael Welch

Michael
R. Welch,
President & CEO

 

 

"Holder"

 

LSW HO LD ING S, LLC

a Limited Liability Corporation

 

 

By:_______________ 

 

    	 	6	 

    	 

    

 

 

 EXHIBIT
A

CONVERSION NOTICE

 

To:[Company Name]

 

The
undersigned hereby irrevocably elects to exercise the right, represented by that certain Convertible Promissory Note dated (the
"Note"), a copy of which is attached hereto, to convert in_outstanding principal amount, and

In accrued
but unpaid interest on the Note into _ shares of common stock (the "Shares") of[Company Name] (the "Company"),
or its successors and assigns.The undersigned requests that certificates for such
Shares be issued in the following names and quantities:

 

 

Dated: ________20_:

 

 

[Name]

By: ______________

 

Name:
____________

 

    	 	7	 

    	 

    

Annex

 

List of Conversions

 

	Conversion Date	Price Per Share	Number of Shares	Amount Converted	Holder
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 

 

    	 	8KeHE Distributors-Vendor Policies 
&
Procedures

 

NATURE’S
BEST

KeHE

 

KeHE

KeHE
Distributors

 Vendor
Poilicies & Procedures

 

Effective
May 31, 2015

 

 

At
KeHE Distributors, LLC C'KeHE''), we
SERVE to make lives better. We achieve success by staying
focused on our three Strategic Anchors: WIN/WIN Vendor Partnerships, GREAT Customer Experience, and
a Smart Supply Chain. We believe a clear understanding of KeHE Distributors' Vendor Policies
and Procedures will deliver on our desire for WIN/WIN Vendor
partnerships.

 

These
Vendor Policies & Procedures
set forth the terms and conditions for the purchase of
products from all of KeHE's Vendors, and cover all business conducted
through current & future
KeHE Distributors' facilities. This includes facilities
that carry the Nature's
Best, Powered
by KeHE branding. Acceptance
of a purchase order from KeHE shall be deemed to be acceptance
of these

Vendor Policies & Procedures.

 

The
terms set forth in this document supersede
any previous or conflicting agreements or terms of purchase,
unless agreed upon in writing by an authorized member of
KeHE's Vendor Management team.

 

If
you have any questions related to these Vendor Policies
& Procedures
or need additional information, please contact the appropriate
Vendor Manager.

 

    	 	1	 

    	 

    

 

 

		1	VENDOR REQUIREMENTS

		1.1	Vendor Submission

 

All
Vendors must complete and submit a KeHE "Vendor Packet" to KeHE's Vendor Manager prior to being setup in
any of KeHE's systems. Key documents and requirements:

		•	Completed Vendor Information
Form including Federal Tax ID & Bio-terrorism
fotm / FDA compliance form.

		•	Signed Hold Harmless Agreement and Guarantee/Warranty of Product Agreement.

		•	Certificate of Product
Liability Insurance for $2,000,000 minimum per occurrence, and $2,000,000
in the aggregate, for general and product liability, with KeHE Distributors, LLC
& its affiliates, successors, subsidiaries, and assigns named as an additional
insured. Minimum per occurrence of $5,000,000 is required for Vitamins, Minerals, Herbs, & Nutritional Supplements.

		•	Completed &
Signed W9 Form, Request for Taxpayer Identification Number and Certification.

		•	Copy of Vendor's blank invoice.

		•	Broker of Record Form, if applicable.

		•	Signed Policy & Procedure Document.

		•	Product Pricing and Spec Sheet

 

		1.2	Vendor Portal

KeHE
will provide Vendor access to KeHE's Vendor Portal. KeHE will use the Vendor
Portal to communicate information to Vendors, as well as access to all forms, schedules, contact

information,
and supporting documents noted in these Vendor Policies & Procedures
within the Vendor Portal. KeHE reserves the right to
amend or modify these Vendor Policies &
Procedures by communicating modifications and/or amendments on the Vendor Portal from

time to time. Vendor shall monitor
the Vendor Portal for any updates on a regular basis.

 

		1.3	KeHE Vendor Diversity Initiative
(SDI)

It
is KeHE's policy to offer minority and woman-owned businesses the opportunity to compete on
an equal basis with all of our vendors. No vendor shall be marketed as an SDI Vendor unless proof of current certification by a
national or regional Minority Vendor Development Council or other approved certification entity has been provided to KeHE. Certification
should be sent to vendorsupport@kehe.com

 

    	 	2	 

    	 

    

 

 

		2	ITEM REQUIREMENTS

		2.1	New Item Submission

 

KeHE's
Vendor Portal is the required
method of submission for all new items.
In addition to submitting the
required new
item information through the portal,
a minimum of one "live" sample unit of any open stock items must
be submitted
to the appropriate Vendor Manager.

 

		2.2	New Item Set-Up Fee

Vendor
will be charged a per-SKU new item set-up fee for each KeHE facility in
which items are activated.
The charge will be $50 for initial
setup into the Central Database and
$50 for each warehouse, to be charged at
the initial purchase
order for each warehouse.
Vendor will also be charged a one-time per SKU amount
of $40 for required product imaging.

 

		2.3	New Item Introductory Allowances

KeHE requires
a minimum 15% off invoice allowance on alt new items introduced
to each KeHE
warehouse.

 

		2.4	UPC Requirements

All
items must have a UPC
number both on the item and
on the outer shipping case. If applicable, Vendor should
provide the EAN code (for European products) and GTIN
code.

 

		2.5	Cut Cases

KeHE strives to
ship items in the most efficient case pack when
possible. There are times when the marketplace dictates smaller
case pack sizes and KeHE does have the capability to
reduce case packs to smaller quantities. When
"cutting cases" is required, KeHE provide the
service and charge back Vendor $0.75 per case. "Master Cases" where KeHE
can simply remove smaller "inner'' case packs, and
where the inner case is the unit of sale, will not be subject
to the fee. Please note KeHE
requires a consistent case pack for all KeHE facilities.

 

		2.6	Item Changes

If an item has
a specification change (e.g. description, pack, weight)
the Vendor must provide KeHE with an Item Change Form. A
copy of the Item Change Form can
be found on the Vendor Portal and must be submitted
to vendorsupoort@KeHE.com once completed. KeHE
must receive a minimum of 90 days advance notice of changes
prior to any purchase orders being created that will be filled with "updated" product. Vendor is
subject to applicable
new item charges in Section 2.2 and 2.3 for any product
specification changes requiring a new item set up.

 

    	 	3	 

    	 

    

		2.7	Initial Orders

KeHE
requires a six month guaranteed sale of new items on initial POs for each KeHE warehouse. Vendor will accept financial responsibility
and provide full credit for any unsold
items at KeHE's landed
cost Vendors are encouraged to collaborate with KeHE's
Supply Chain team to determine
appropriate initial order quantities on new items. For initial purchase orders from a new Vendor,
KeHE will not release payment until
the opening inventory has been sold to
retail customers.

 

		2.8	Discontinued, Short Dated, Expired, and Underperforming Items

Vendor
will accept financial responsibility and provide full credit at KeHE's
landed cost for items in KeHE's inventory
that are (a) discontinued by retailers, Vendor or KeHE; (b) short dated, expired, or out-of-date;
or (c) underperforming and/or overstocked items.
In such cases, Vendor's Products in KeHE's
inventory may be returned, donated, or salvaged, at KeHE's discretion. Vendors are also expected to be active in monitoring and
maintaining proper inventory
levels for both new and existing Products.

		•	For discontinued items by
KeHE or Vendor,
KeHE will use its reasonable discretion
whether discontinued Products will be sold or returned immediately.

		•	Code date sensitive
items will be donated or salvaged
and charged back to Vendor when they fall
below KeHE's days-to-retail guaranteed dates.

		•	Excess inventory
deemed unsalable after a reasonable time period will be donated or salvaged
and charged back to Vendor.

		•	For items returned to the
Vendor,
KeHE will provide current inventory and the landed cost of inventory. If the
Vendor does not make arrangements to have the item returned within 14 days of notification,
KeHE will donate or discard the item and charge the landed cost back to the
Vendor. Vendor is responsible for any freight charges.

 

		2.9	Guarantee by Vendor

Vendor
guarantees the return purchase from KeHE of all items with
UPC changes, pack changes, or size changes. KeHE will provide Vendor with a full count of the remaining items in inventory along
with KeHE's landed cost. If disposition arrangements are not made within 14 days from notice,
KeHE will dispose of
Products in its discretion and charge full landed cost
of inventory back to Vendor.

 

		2.10	Product Information and License

In
connection with KeHE's purchase and resale of Vendor's Products, Vendor authorizes KeHE to use Vendor's product information, obtained
from Vendor or other sources, including but not limited
to, trademarks, trade dress,
advertisements, labels,
photographs, images, packaging,
and nutritional content relating to Vendor's Products sold to KeHE. Vendor grants KeHE a worldwide,
non-exclusive license to use and sublicense Vendor's product
information in connection with KeHE's sale and promotion
of Vendor's Products. Vendor represents and warrants it owns, or otherwise has the right to license to KeHE, the product information
and is authorized to sell the Products to KeHE.

 

    	 	4	 

    	 

    

 

 

		3	PAYMENT TERMS AND PRICING

		3.1	Payment Terms

 

KeHE's
payment terms are 2% 10 days - net 30. The payment due
date is calculated from date of receipt of
invoice at KeHE's billing address or date when goods are available
for sale whichever is later. Payment discounts are calculated
based on the net
invoice amount. An invoice referencing
the correct KeHE purchase order(s) is required for
payment. KeHE will deduct from payment all deductions detailed
herein.

 

		3.2	Special Event Terms

During
special event
or seasonal periods, KeHE requires 2% 60, net 61 day terms on
pre packs and seasonal SKUs. KeHE also requires 2% 60 -
Net 61 day terms on all merchandise for new KeHE warehouse
openings.

 

		3.3	Open Balances Due to KeHE

All
amounts due to Vendor are subject to set off and deduction
of amounts due to KeHE by Vendor. If deductions owed by
Vendor to KeHE are greater than any outstanding invoices
owed by KeHE to Vendor, and such balances remains open
for a period of sixty (60) days, KeHE will invoice Vendor for such outstanding amounts and Vendor
shall pay such amounts to KeHE. Invoices that
are set off due to amounts owed to KeHE are still subject to cash discounts under KeHE's
payment terms.

 

		3.4	Request for Repayment
Procedures

If
Vendor wishes to dispute any payment deductions, Vendor
must send its detailed request electronically
to vendorperformance@KeHEco.m
within 180
days of KeHE's
deduction from Vendor's invoice. Vendor
is responsible for providing all necessary back up and/or detail which is in Vendor's
possession when sending the request, including written (electronically or by
hand) communication between Vendor, broker or KeHE personnel (account manager or vendor
manager). Vendor will be credited for deductions only if
KeHE determines that a deduction error has occurred.

 

		3.5	Vendor Pricing

 

Vendor
must provide KeHE With pricing for both F.O.B. origin (per KeHE's pickup) and
F.O.B. destination (delivery by Vendor) pricing to KeHE warehouses.
Additionally, Vendor shall include all taxes, duties, and other fees to KeHE in the
pricing provided. Unless otherwise agreed, all new VendQrs will be setup F.O.B. origin with KeHE's transportation department managing
the freight. Vendor pricing and terms shall be no
less favorable to KeHE than offered to any other distributor
purchasing comparable quantities.

 

    	 	5	 

    	 

    

		3.6	Price Change Notification and Justification

In
order to meet processing and lead-time requirements for price changes in the marketplace, KeHE requires all Vendor cost changes
be received a minimum of 90 days prior to KeHE's published price change effective date. The current KeHE Price Change calendar
can be found on KeHE's Vendor
Portal. Price change submissions require a Vendor Cost
Change Letter, completed KeHE Cost Change Notification
Form, completed Price Change Detail Form, and copies of published Vendor price lists including
all FOB, Delivered, and bracket options available. Price
changes must be submitted, via e-mail, to vendorsuppor@t
KeHE.com. Price changes will not be
considered submitted until all required information has been received by KeHE. No price changes will be accepted during deal periods
or during pack change conversions. If a Vendor has an EDLP
or EDLC agreement with a retailer, Vendor will honor any price difference caused by a price change until said EDLP or EDLC agreement
expires. KeHE reserves the rights to reject the submitted
price change if the increase is unreasonable in light of
available information from the marketplace or what competing Vendor price change submissions reveal. In the event of a price decrease,
Price Protection of existing inventory is required and KeHE will charge back Vendor based on the lost inventory value at the time
the new price is effective.

 

Price
Protection means, in the event of a price reduction by Vendor, the Vendor shall credit KeHE for the difference between prior price
paid by KeHE and Vendor's new lower price for all Vendor product in KeHE's inventory.

 

		3.7	Audits

Vendor
shall keep full and detailed accounts for a period of not less than two (2) years and shall exercise such controls as may
be necessary for proper financial management with respect to transactions with KeHE. KeHE reserves the right to audit up to
two (2) years of Vendor's transactions with KeHE. Auditable transactions include, but are not limited to items such as
invoices, price changes, promotions, credits and charge backs. In the event a retailer deducts
audit claims from KeHE for a Vendor's Products or agreements, KeHE reserves the right to charge
these amounts back to Vendor beyond the (2) year limitation noted. When audit claims are identified by a third party,
amounts will be deducted from amounts due Vendor after 30 days' notice. Claims resulting from
an internal KeHE or retailer audit will be subject to deduction from amounts due Vendor immediately.

 

    	 	6	 

    	 

    

 

 

 

 

 

 

		4	PURCHASE ORDERS

 

		4.1	Purchase Order Transmission and Confirmation

KeHE
requires a purchase order for
all product shipments. Purchase orders will be communicated electronically via electronic fax
or EDI. KeHE does not guarantee any purchase
or performance levels of a retailer.
Vendor shall confirm purchase orders within one
(1) business day of receipt and confirm items/quantities
on all purchase orders five (5) business days prior to
pick up or shipping. Advance shipment confirmation to KeHE's Supply Chain team
with detail as to product shortages and/or delays by
SKUs is required.

 

 

		4.2	No Substitutions or Backorders

No
change in the Products or quantities ordered on a KeHE PO
shall be made other than product shortages due to Vendor out
of stocks. Any adjustment must be made by receiving a revised
PO from KeHE. KeHE does not accept backorders.

 

 

		4.3	Purchase Order Payment

 

KeHE
will only pay Vendor
invoices based on the lower
of KeHE's
purchase order net price or Vendor's
invoice amount. Any adjustments to purchase order pricing
or discounts will require
a revised PO.

 

 

		4.4	Order Cancellation

KeHE
may immediately cancel all
or any part
of any order
without liability to Vendor in the
event Vendor fails to make progress
so as to endanger timely and proper completion of services or delivery of goods, Vendor becomes
insolvent, files for bankruptcy or in the
event of the appointment of a receiver or trustee for Vendor.

 

    	 	7	 

    	 

    

 

 

 

 

 

		5	SHIPPING AND RECEIVING

 

		5.1	Shipping and Receiving

Vendor
agrees to all the terms of KeHE's "
I nbound Routing Guide & Vendor Compliance Instructions", a copy of
which
has been made available on KeHE's Vendor Portal, and which may be
updated from time
to time in
KeHE's
sole discretion.
If a Vendor
chooses to ship on a pre-paid basis
(delivered), Vendor is responsible for
any and all shipping charges, fuel surcharges, and accessorial costs (e.g.
detention, re-weighing, and re-delivery).

 

		5.2	Lumping
Fees

Payment
of lumping fees, sort
and segregate charges, and non-compliance fees,
or any similar
fees will be the responsibility of the carrier delivering Vendor's Products, and
Vendor shall be responsible for any disputed fees. Vendor is not responsible for these fees on inbound
freight managed by KeHE as they are included in the Inbound Cost. Refer to KeHE's Inbound Routing Guide & Vendor Compliance
Instructions for current rates and additional information. Such fees are subject to change
with reasonable advance notice.

 

		5.3	Delivery (Prepaid) and Pickup (FOB)

Time
is of the essence. Deliveries shall be made when, where
and in such quantities as specified by KeHE's
purchase order. Vendor shall pack all Products ordered hereunder in a manner suitable for
shipment and sufficient to enable the Products to withstand the effects of shipping, including
handling conforming to normal industry practices, during loading and
unloading. Vendor shall notify KeHE's Transportation Department and KeHE's Supply Chain Management team if a delivery ls not expected
to be made on time. Contact
information for these departments is available on the Vendor Portal. If notice is not given that delivery is expected to be late,
KeHE may cancel the delivery immediately upon
written notice to Vendor. Absent such cancellation, Vendor may take reasonable steps, at its own costs, to expedite delivery. Product
for pick-up by KeHE, or its authorized third-party freight company, shall be ready on the pick-up date identified in KeHE's purchase
order.

 

		5.4	Temperature Controls

Refrigerated
and frozen foods should be
delivered to KeHE's
dock consistent with the customary standard temperature range declared for that Product, with
"perishable" or "frozen" clearly marked on
each outer case, and with all accompanying bills of lading clearly stating the temperature
range that the product should be maintained at during warehousing and during transit time to
retail customers. KeHE may reject (at Vendor's expense) any Product if its temperature is outside the stated standard temperature
range. The phrase "Keep
Refrigerated/Frozen''
or similar type language must be clearly marked on the exterior
of case on all refrigerated/frozen Products.
All bills of lading for
all product, whether Vendor delivered or picked up by KeHE or its authorized third party freight company, will clearly have the
shipping temperature requirements notated on the document.

 

    	 	8	 

    	 

    

		5.5	Fill Rate

Vendor
shall maintain a minimum inbound fill rate of 98% and
a minimum inbound/on-time performance of 92% on
a consistent basis.
Failure to maintain the required inbound performance
rates may result in product discontinuation,
and KeHE reserves the right to charge administrative
and other fees as a result of such failure. Vendor shall
furnish KeHE with a written
explanation, via email
to unavailablelongterm@kehec.
om, for any
Product that is out of stock, or likely
to be out of stock, in excess of twenty eight (28) days.
This written explanation
must include the reason for
the product availability issue
and an estimated date of correction.
KeHE may share this information with its retail customers.
Items that
do not ship against KeHE purchase orders
for sixty (60) days
may be subject
to discontinuation at KeHE's sole discretion.

 

		5.6	Title and Risk of Loss

Title
and risk of loss and damage shall
remain with Vendor until
the Products are delivered to the location specified in KeHE's purchase order, or upon pick-up
by KeHE or KeHE's carrier at Vendor's warehouse.
All deliveries
are subject to inspection
and acceptance at a KeHE facility.

 

		5.7	Pallets

KeHE
requires pallet costs be built
into a Vendor's list product price. Any Vendor or shipping company
charges to KeHE for pallets must be negotiated in advance and agreed
to in writing by a KeHE Vendor
Manager. KeHE does not
participate in any pallet pool type programs (e.g. Chep pallets).

 

		5.8	Inspection and Shipment Confirmations

All
shipments are subject
to KeHE's right
of inspection and approval. KeHE shall have
the right to reject any Products or services that do not conform to Vendor's
warranty, specifications or other obligations
as outlined within these
Vendor Policies & Procedures. KeHE
relies on the case count
confirmed at its
warehouses as the basis for
payment to Vendor. KeHE
will not accept
any liability relating to documentation signed
at the point of origin
by either its drivers or its third party
logistics drivers, and Vendor
agrees to rely on KeHE's case count at its warehouse. An Unload Discrepancy Report (UDR)
will be provided to Vendor
noting items, quantities, and reason for product not received at the time of PO
receipt.

 

		5.9	Quantity
Shipped in Excess of
Quantity Ordered

If
Vendor ships more than the quantity stated in KeHE's Purchase
Order for any SKU, KeHE will notify Vendor of the
over shipment requesting disposition
of the overage.  If
KeHE elects to receive the overage, KeHE will receive the
product at a 30%
discount. KeHE will NOT
pay for items shipped by Vendor that are not on
the original KeHE PO or invoiced to KeHE under the
correct purchase order number.

 

    	 	9	 

    	 

    

 

		6	MARKETING AND PROMOTIONS

		6.1	Submission

All
general trade promotional allowances must be submitted through KeHE's Vendor Portal prior
to the published promotional deadlines listed in KeHE's
Promotion Schedule available on the Vendor Portal, as may be updated from time to
time by KeHE. Promotional allowances negotiated
via brokers or other agents of Vendor shall be honored by Vendor.

 

		6.2	Off Invoice Allowances

Providing
KeHE with off invoice allowances based on KeHE purchases is the preferred method for a Vendor's
promotions into the marketplace. KeHE requires specific buy dates for promotional periods. These buy dates can be referenced on
the KeHE Promotional Schedule available on KeHE's Vendor
Portal. Quoted allowances must be available on all purchase orders placed by KeHE during the promotional period and will be taken
from the date the purchase order was written .

 

		6.3	Promotional Price Protection

Although
KeHE always does our best to manage proper inventory levels,
occasionally inventory bought at full price will be carried
into a promotional period. In such cases, Vendor shall
provide Price Protection for all Products shipped to retailers during the promotional period.
The discount on all full price inventory sold during the promotional period will be charged
back to Vendor allowing KeHE to honor the promotion to retailers.

 

		6.4	Manufacturer Charge Backs (''MCBs'')

KeHE
also accepts Manufacturer Charge Back ("MCB") arrangements for promotions-with the chargeback amount based on outbound
case movement during the promotional period. MCB promotions will be charged back to Vendor on a bi-weekly basis. KeHE will charge
a bi weekly processing fee of 5% of the MCB amount (with a minimum of $65 per purchasing Vendor/facility). MCB invoice backup will
be provided through KeHE's Vendor Portal.

 

		6.5	Extra Performance

Vendor
is responsible
for all promotional amounts and retailer fees related to Extra Performance processed by KeHE for retailer and Vendor convenience,
including but not limited to retailers' advertising, scans, in-store demos, placement fees, and slotting
fees. KeHE will "pass through" these amounts to Vendor along with an administrative charge of 5% on the total amount
of each invoice with a maximum of $175 per invoice. Extra Performance refers to any vendor promotional support funds or any payments,
negotiated directly between retailers and vendors, but collected by KeHE on behalf of retailer.

		6.6	Free Products at New Points of Distribution and New Store Grand Openings

Vendor
shall offer new placement allowances or "Free Placements" to all retailers on an equal and proportionate basis. Free
Placements means Vendor will provide the first case of Vendor's Products (based on KeHE's standard unit of sale) at no charge to
retailer for new points of distribution for that Product including New Store Grand Openings and new SKU's placed in retailer stores.
Free Placements will be processed and charged back to Vendor at
KeHE's landed cost plus an 18%
administrative fee depending on retailer relationship.

    	 	10	 

    	 

    

		6.7	Product Samples

Product samples pulled
from KeHE inventory will be billed back at list wholesale
price.

 

		6.8	Turnover Orders

Turnover
orders are one-time deals that a retail store has authorized a Vendor or broker to submit for shipment on the store's behalf. All
turnover orders are final. No returns are accepted. Turnover order discounts that are submitted, but are not part of any KeHE promotions
at the given time, will be automatically MCB'd off of wholesale. Promotional discounts must
be listed otherwise they will
be treated as an MCB.

 

		6.9	Promotion Allowance Audits

Quoted
off invoice allowances must be in effect and given to KeHE on all purchase orders placed within the
stated KeHE promotion Buy Dates. KeHE also expects 100% fill rate during promotional periods
in order to fill retailer promotional demand. KeHE will perform audits either internally or through a third party to ensure allowances
have been properly received and to recoup losses due to product shortages. KeHE may also audit MCB allowance transaction to ensure
accuracy.

 

		6.10	Marketing Allowance

In
order for KeHE to provide Vendors and retailers with extensive marketing support, Vendor shall
provide a 1.5% marketing allowance on all purchases. KeHE calculates the allowance on the net of each purchase order and requires
this allowance be given off invoice
as a separate line on each Vendor invoice.

 

		6.11	KeHE Advertising and Events

KeHE
provides Vendors with many advertising and event opportunities to drive sales growth such as Marketing Monthly Advertising, KeHE
Holiday Show, KeHE shows and events, and Regional Table Tops. These programs have additional expenses, that when approved by Vendor
will require pre-payment or will be deducted from Vendor. For new Vendors
and new items, KeHE requires advertising as part of Vendor's
go to market plan. Advertising for all new Vendors must be pre-paid
via check or credit card in advance.

 

		6.12	Publication Listing Fees

KeHE
provides many publications to our retail customers that provide
exposure for Vendors, such as catalogs, flyers, and promotional
guides. Vendors are encouraged to take advantage of KeHE's advertising programs. In the event a Vendor
does not advertise, KeHE will charge back applicable fees when Vendor's Products are listed in KeHE publications. Vendor will not
be charged for publication fees when Vendor contracts for advertising in at least one publication during a promotional period or
by participating in KeHE shows covering multiple promotional periods. Current publication listing
fees are available on the Vendor Portal.

 

    	 	11	 

    	 

    

 

 

		7	RETAIL MARKETPLACE EXPENSES

		7.1	Retailer Charges

KeHE
reserves the right to pass
through all expenses which KeHE has incurred from retailers related to Vendor's Products regardless of the time of such expenses.
These expenses include, but are not limited to, store level spoils charged back by retailers, charges for Products discontinued
by retailer, credits for recalls and manufacturer defects, product &
manufacturer performance related fines and fees.

 

		7.2	Spoils

"Spoils"
are any costs or expenses that originate from retailers and require credit for Vendor's Products. Spoils include, but are not limited
to, expired product, mislabels, loose caps, leaking products,
etc. When and if Spoils occur, Vendor will only be held responsible for KeHE's landed cost of goods which have been credited to
a retailer plus a $0.29 per unit processing fee or fixed retailer spoilage rate on product sales depending on retailer program.

 

		7.3	Retailer Reclamation

If
Vendor's Products are sold to
retailers that use reclamation programs, Vendor is subject to the retailer's reclamation deductions,
over and above any off-invoice spoils allowance given to KeHE on purchases. Reclamation charges
include programs operated by retailers, by third parties
on behalf of retailers, and where retailers ask KeHE to operate such reclamation programs or provide administrative support.
Vendor is required to cover 100% of reclamation costs incurred by KeHE for reclamation costs
from retailers. Such charges are deducted from KeHE by retailer and will
be passed through directly to Vendor.

 

		7.4	Retail Services

It
is common for retailers to engage in reset and other merchandising activities using Internal or third party labor. If
a retailer charges vendors for these services and
collects these funds from KeHE, KeHE will deduct these charges from balances due Vendor. If a retailer charges KeHE for these services,
KeHE will deduct these charges from its Vendors on a pro-rated basis based on the products affected.

 

		7.5	Discontinued Items

If a
retailer discontinues any of Vendor's Products (at some or all of its retail locations), KeHE will charge Vendor back at
KeHE's landed cost of goods credited to retailer
plus a $0.29 per unit processing fee. KeHE
will also require Vendor to take back any of KeHE's warehouse inventory should the retailer discontinuation
result in the product no longer maintaining sufficient turns in KeHE's facility, and/or credit for such Products at KeHE's
adjusted cost.

 

    	 	12	 

    	 

    

 

		8	QUALITY STANDARDS

		8.1	Food Safety

KeHE
requires that Vendor's product meet or exceed all FDA and other federal, state and local laws, rules or regulations regarding labeling
compliance/food safety issues at time of shipment and delivery. All importers of Products
must comply with the Bioterrorism Act at the time of shipment and delivery. All Kosher Products
must meet the requirements of the certifying entity whose symbol is featured on
that product's packaging. Vendor shall provide any warnings required
by California's Safe Drinking Water and Toxic Enforcement Act known as Proposition 65.

If
requested by KeHE, Vendor shall provide KeHE a copy of Vendor's most recent food safety audit for any facilities that manufactures
or warehouses Vendor's products, as well as identify the country of origin for each ingredients
or components of Supplier's products.

 

		8.2	Organic Standards

Vendor
shall deliver current organic certificates annually, certified by an accredited USDA certifier, listing all organic Products
by name along with any related documentation. No Products will be marketed as Organic by KeHE unless the current
certification is on file. All certificates should be sent to vendorsupport@kehe.com

 

		8.3	Date Coding

Vendor
guarantees at least 75% of maximum shelf life from time of production for all Products
received at KeHE distribution centers. Shipments of Products to KeHE must meet the stated shelf life
guarantee at the time of product receipt at a KeHE facility. KeHE requires that a "human-readable" date code be clearly
stamped on each exterior carton which shall be in English using the date format of MM/DD/YYYY.
Otherwise, KeHE must be supplied--on the shipping documents--
with the translated code dates specific to the product within the shipment When requested, Vendor
shall deliver to KeHE's Supply Chain Management team information
describing the Product's code dating methodology.

 

		8.4	Container Deposit Laws

Vendor
shall comply with all applicable federal, state, and local
container deposit laws and shall reimburse KeHE for the
cost of any recycling fees paid by KeHE and for registering Vendor's
labels with the applicable state agencies.

 

    	 	13	 

    	 

    

 

		9	DEFECTIVE PRODUCT

		9.1	Recall of Products

If
Vendor becomes aware that any Products sold by Vendor to KeHE are, may be,
or may become harmful to anyone
or anything or that the Products are
defective or adulterated in any manner, Vendor shall immediately
give written notice to KeHE's Supply
Chain team by
email (to
KeHERecall@KeHE.co)m.
Said notice
shall
include, without
limitation, the
severity level of the recall (if
applicable), the relevant
UPCs and product description
and all relevant information
with respect thereto. Vendor shall assist and cooperate
with KeHE in all respects
of the recall of its
Products,
and shall, in addition
to any other rights or remedies available
to KeHE reimburse KeHE upon demand for its administrative
costs associated with the
recall.

 

		9.2	Recall Charges

KeHE
shall pass through to Vendor any recall penalties that
retailers charge to KeHE for a Vendor's product recall. KeHE shall
also charge the Vendor for costs
that KeHE incurs in
order to execute the
product recall at its
warehouses, from its delivery trucks in
route, and from its retail customers' backrooms and shelves. KeHE's recall expense recovery deductions are
as follows:

		•	For any recall or
                                                                                                                          incident involving only
                                                                                                                          a warehouse hold for return or
                                                                                                                          destruction: $100 per SKU per DC

		•	For a recall
involving a "quality concern" and field
personnel intervention:
$175 per SKU per DC

		•	For a recall
                                                                                                                          involving a "health risk or
                                                                                                                          other hazard" and
                                                                                                                          field personnel intervention: $250 per SKU per DC

 

		9.3	Disposition of Defective Products

In
addition to any other remedy which KeHE may have,
Vendor shall replace at Vendor's sole cost
and expense, including freight and
disposition costs, Products that are found
by KeHE to be damaged,
non-conforming, defective or not
in compliance with
these Vendor Policies
& Procedures.
If Vendor fails to instruct
KeHE as to the disposition of such Defective Products within 14 days of notification by KeHE,
KeHE may dispose of such Defective Products in a commercially reasonable manner and Vendor
shall promptly reimburse KeHE
for all costs, and replace the Defective
Products with conforming Products
without charge, or at KeHE's

election,
refund all payments made by KeHE for the Defective
Products. KeHE
shall have no obligation
to pay for any Products that
are subject to a claim of non-compliance or defect.

 

    	 	14	 

    	 

    

 

 

		10	MISCELLANEOUS

		10.1	Insurance and Indemnification

Vendor
shall execute the Hold Harmless Agreement and Guarantee/Warranty
of Product.

 

		10.2	Governing Law; Jurisdiction; Venue

These
Vendor Policies & Procedures shall be governed by and interpreted in accordance with the
laws of the State of
Illinois. Vendor
submits and consents to the jurisdiction of
any state or federal
court of competent jurisdiction located in Cook County,
Illinois, in any action
or proceeding arising out
of or relating to these
Vendor Policies & Procedures and
waives any defense of inconvenient forum to
action in such court.

 

		10.3	Independent Contractors

Nothing
contained in these Vendor Policies & Procedures shall be construed as creating a partnership
or joint venture between KeHE
and Vendor, and Vendor
shall at all times be
deemed to be an independent contractor with respect to
KeHE, solely responsible for the manner by and
the form in which it fulfills
these Vendor Policies
& Procedures.

 

		10.4	Assignment

Vendor
shall not assign these Vendor Policies &
Procedures without KeHE's prior written consent,
which consent may be withheld or conditioned
in KeHE's sole discretion.

 

		10.5	Entire Agreement

All
purchase orders from KeHE to Vendor, together with these
Vendor Policies & Procedures
and any updates posted
on KeHE's Vendor Portal, shall constitute the complete, exclusive and final expression of the
parties' agreement. Toe invalidity, in whole or in part, of any Section of these Vendor Policies
& Procedures shall not affect any
other Section. To the extent of
any conflict or inconsistency between these Vendor Policies
& Procedures and any
purchase order, or any similar document, these Vendor Policies & Procedures
shall govern.

 

		10.6	Remedies

In
no event will KeHE be
liable to Vendor, for any indirect, incidental,
consequential, special, punitive or exemplary
damages,
including, without limitation, lost
profits,
lost business, damage to goodwill
or reputation.

 

		10.7	Amendment and Waiver

KeHE
reserves the right to modify these Vendor Policies & Procedures
at any time with at least
thirty (30) days prior notice by posting
changes on the Vendor Portal of the
KeHE's website. Any such amendment shall only apply
to purchases of Products on or after the effective date of
such amendment. Toe failure of KeHE to enforce any provision
of these Vendor Policies &
Procedures shall not
be construed as a waiver or limitation of KeHE's
right to subsequently
enforce any provision herein.

 

		10.8	Addendums

Any
variances from these Vendor Policies & Procedures must be
set forth in a written Addendum signed and dated by authorized
representatives of KeHE and the
Vendor.

 

 

    	 	15	 

    	 

    

 

KeHE

NATURE'SBEST

POWERED
BY  ,KeHE

 

 

 

 

I Charles Smith (Print
Name)
as
a duly authorized
representative of Rocky Mountain High Brands, Inc. (Vendor Company Name) have read and agree
to KeHE Distributors Vendor Policies & Procedures, dated May 31, 2015.

/s/ Charles Smith

Authorized Signature

 

Charles Smith

Print Name

 

3/14/18

Date

 

Chief Operating Officer

Print Title

 

Vendor Address:

9101 LBJ Freeway

Suite 200

Dallas, TX 75243

 

 

 

Acceptance of the terms and
conditions set forth in this document shall be deemed
to occur upon (1) Vendor's
signing of the document, (2) Vendor's written acceptance of the
document via email or other written notification, or (3) Vendor's
shipping Products on or after May 31,
2015 that have been ordered by KeHE.

 

    	 	16

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