Document:

FLKS 2014.12.31 Ex-10.4

Exhibit 10.4
FLEX PHARMA, INC. 
2015 EQUITY INCENTIVE PLAN 
 
OPTION AGREEMENT 
(INCENTIVE STOCK OPTION OR NONSTATUTORY STOCK OPTION)
Pursuant to your Stock Option Grant Notice (“Grant Notice”) and this Option Agreement, Flex Pharma, Inc. (the “Company”) has granted you an option under its 2015 Equity Incentive Plan (the “Plan”) to purchase the number of shares of the Company’s Common Stock indicated in your Grant Notice at the exercise price indicated in your Grant Notice.  The option is granted to you effective as of the date of grant set forth in the Grant Notice (the “Date of Grant”).  If there is any conflict between the terms in this Option Agreement and the Plan, the terms of the Plan will control. Capitalized terms not explicitly defined in this Option Agreement or in the Grant Notice but defined in the Plan will have the same definitions as in the Plan.
The details of your option, in addition to those set forth in the Grant Notice and the Plan, are as follows:
1.VESTING.  Subject to the provisions contained herein, your option will vest as provided in your Grant Notice.  Vesting will cease upon the termination of your Continuous Service.
2.    NUMBER OF SHARES AND EXERCISE PRICE.  The number of shares of Common Stock subject to your option and your exercise price per share in your Grant Notice will be adjusted for Capitalization Adjustments.
3.    EXERCISE RESTRICTION FOR NON-EXEMPT EMPLOYEES.  If you are an Employee eligible for overtime compensation under the Fair Labor Standards Act of 1938, as amended (that is, a “Non-Exempt Employee”), and except as otherwise provided in the Plan, you may not exercise your option until you have completed at least six (6) months of Continuous Service measured from the Date of Grant, even if you have already been an employee for more than six (6) months. Consistent with the provisions of the Worker Economic Opportunity Act, you may exercise your option as to any vested portion prior to such six (6) month anniversary in the case of (i) your death or disability, (ii) a Corporate Transaction in which your option is not assumed, continued or substituted, (iii) a Change in Control or (iv) your termination of Continuous Service on your “retirement” (as defined in the Company’s benefit plans).  
4.    EXERCISE PRIOR TO VESTING (“EARLY EXERCISE”).  If permitted in your Grant Notice (i.e., the “Exercise Schedule” indicates “Early Exercise Permitted”) and subject to the provisions of your option, you may elect at any time that is both (i) during the period of your Continuous Service and (ii) during the term of your option, to exercise all or part of your option, including the unvested portion of your option; provided, however, that:
(a)    a partial exercise of your option will be deemed to cover first vested shares of Common Stock and then the earliest vesting installment of unvested shares of Common Stock;
(b)    any shares of Common Stock so purchased from installments that have not vested as of the date of exercise will be subject to the purchase option in favor of the Company as described in the Company’s form of Early Exercise Stock Purchase Agreement;

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(c)    you will enter into the Company’s form of Early Exercise Stock Purchase Agreement with a vesting schedule that will result in the same vesting as if no early exercise had occurred; and
(d)    if your option is an Incentive Stock Option, then, to the extent that the aggregate Fair Market Value (determined at the Date of Grant) of the shares of Common Stock with respect to which your option plus all other Incentive Stock Options you hold are exercisable for the first time by you during any calendar year (under all plans of the Company and its Affiliates) exceeds one hundred thousand dollars ($100,000), your option(s) or portions thereof that exceed such limit (according to the order in which they were granted) will be treated as Nonstatutory Stock Options.
5.    METHOD OF PAYMENT.  You must pay the full amount of the exercise price for the shares you wish to exercise.  You may pay the exercise price in cash or by check, bank draft or money order payable to the Company or in any other manner permitted by your Grant Notice, which may include one or more of the following:
(a)    Provided that at the time of exercise the Common Stock is publicly traded, pursuant to a program developed under Regulation T as promulgated by the Federal Reserve Board that, prior to the issuance of Common Stock, results in either the receipt of cash (or check) by the Company or the receipt of irrevocable instructions to pay the aggregate exercise price to the Company from the sales proceeds.  This manner of payment is also known as a “broker-assisted exercise”, “same day sale”, or “sell to cover”.
(b)    Provided that at the time of exercise the Common Stock is publicly traded, by delivery to the Company (either by actual delivery or attestation) of already-owned shares of Common Stock that are owned free and clear of any liens, claims, encumbrances or security interests, and that are valued at Fair Market Value on the date of exercise.  “Delivery” for these purposes, in the sole discretion of the Company at the time you exercise your option, will include delivery to the Company of your attestation of ownership of such shares of Common Stock in a form approved by the Company.  You may not exercise your option by delivery to the Company of Common Stock if doing so would violate the provisions of any law, regulation or agreement restricting the redemption of the Company’s stock.
(c)    If this option is a Nonstatutory Stock Option, subject to the consent of the Company at the time of exercise, by a “net exercise” arrangement pursuant to which the Company will reduce the number of shares of Common Stock issued upon exercise of your option by the largest whole number of shares with a Fair Market Value that does not exceed the aggregate exercise price.  You must pay any remaining balance of the aggregate exercise price not satisfied by the “net exercise” in cash or other permitted form of payment.  Shares of Common Stock will no longer be outstanding under your option and will not be exercisable thereafter if those shares (i) are used to pay the exercise price pursuant to the “net exercise,” (ii) are delivered to you as a result of such exercise, and (iii) are withheld to satisfy your tax withholding obligations.
6.    WHOLE SHARES.  You may exercise your option only for whole shares of Common Stock.
7.    SECURITIES LAW COMPLIANCE.  In no event may you exercise your option unless the shares of Common Stock issuable upon exercise are then registered under the Securities Act or, if not registered, the Company has determined that your exercise and the issuance of the shares would be exempt from the registration requirements of the Securities Act.  The exercise of your option also must comply with all other applicable laws and regulations governing your option, and you may not exercise your option if the Company determines that such exercise would not be in material compliance with such laws and regulations (including any restrictions on exercise required for compliance with Treas. Reg. 1.401(k)-1(d)(3), if applicable).

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8.    TERM.  You may not exercise your option before the Date of Grant or after the expiration of the option’s term.  The term of your option expires, subject to the provisions of Section 5(a) of the Plan, upon the earliest of the following:
(a)    immediately upon the termination of your Continuous Service for Cause;
(b)    three (3) months after the termination of your Continuous Service for any reason other than Cause, your Disability or your death (except as otherwise provided in Section 8(d) below); provided, however, that if during any part of such three (3) month period your option is not exercisable solely because of the condition set forth in the section above relating to “Securities Law Compliance,” your option will not expire until the earlier of the Expiration Date or until it has been exercisable for an aggregate period of three (3) months after the termination of your Continuous Service; provided further, if during any part of such three (3) month period, the sale of any Common Stock received upon exercise of your option would violate the Company’s insider trading policy, then your option will not expire until the earlier of the Expiration Date or until it has been exercisable for an aggregate period of three (3) months after the termination of your Continuous Service during which the sale of the Common Stock received upon exercise of your option would not be in violation of the Company’s insider trading policy.  Notwithstanding the foregoing, if (i) you are a Non-Exempt Employee, (ii) your Continuous Service terminates within six (6) months after the Date of Grant, and (iii) you have vested in a portion of your option at the time of your termination of Continuous Service, your option will not expire until the earlier of (x) the later of (A) the date that is seven (7) months after the Date of Grant, and (B) the date that is three (3) months after the termination of your Continuous Service, and (y) the Expiration Date;
(c)    twelve (12) months after the termination of your Continuous Service due to your Disability (except as otherwise provided in Section 8(d)) below;
(d)    eighteen (18) months after your death if you die either during your Continuous Service or within three (3) months after your Continuous Service terminates for any reason other than Cause;
(e)    the Expiration Date indicated in your Grant Notice; or
(f)    the day before the tenth (10th) anniversary of the Date of Grant.
If your option is an Incentive Stock Option, note that to obtain the federal income tax advantages associated with an Incentive Stock Option, the Code requires that at all times beginning on the Date of Grant and ending on the day three (3) months before the date of your option’s exercise, you must be an employee of the Company or an Affiliate, except in the event of your death or Disability.  The Company has provided for extended exercisability of your option under certain circumstances for your benefit but cannot guarantee that your option will necessarily be treated as an Incentive Stock Option if you continue to provide services to the Company or an Affiliate as a Consultant or Director after your employment terminates or if you otherwise exercise your option more than three (3) months after the date your employment with the Company or an Affiliate terminates.
9.    EXERCISE.
(a)    You may exercise the vested portion of your option (and the unvested portion of your option if your Grant Notice so permits) during its term by (i) delivering a Notice of Exercise (in a form designated by the Company) or completing such other documents and/or procedures designated by the Company for exercise and (ii) paying the exercise price and any applicable withholding taxes to the Company’s 

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Secretary, stock plan administrator, or such other person as the Company may designate, together with such additional documents as the Company may then require.
(b)    By exercising your option you agree that, as a condition to any exercise of your option, the Company may require you to enter into an arrangement providing for the payment by you to the Company of any tax withholding obligation of the Company arising by reason of (i) the exercise of your option, (ii) the lapse of any substantial risk of forfeiture to which the shares of Common Stock are subject at the time of exercise, or (iii) the disposition of shares of Common Stock acquired upon such exercise.
(c)    If your option is an Incentive Stock Option, by exercising your option you agree that you will notify the Company in writing within fifteen (15) days after the date of any disposition of any of the shares of the Common Stock issued upon exercise of your option that occurs within two (2) years after the Date of Grant or within one (1) year after such shares of Common Stock are transferred upon exercise of your option.
(d)    By exercising your option you agree that you will not sell, dispose of, transfer, make any short sale of, grant any option for the purchase of, or enter into any hedging or similar transaction with the same economic effect as a sale, any shares of Common Stock or other securities of the Company held by you, for a period of one hundred eighty (180) days following the effective date of a registration statement of the Company filed under the Securities Act or such longer period as the underwriters or the Company will request to facilitate compliance with FINRA Rule 2711 or NYSE Member Rule 472 or any successor or similar rules or regulation (the “Lock-Up Period”); provided, however, that nothing contained in this section will prevent the exercise of a repurchase option, if any, in favor of the Company during the Lock-Up Period.  You further agree to execute and deliver such other agreements as may be reasonably requested by the Company or the underwriters that are consistent with the foregoing or that are necessary to give further effect thereto.  In order to enforce the foregoing covenant, the Company may impose stop-transfer instructions with respect to your shares of Common Stock until the end of such period.  You also agree that any transferee of any shares of Common Stock (or other securities) of the Company held by you will be bound by this Section 9(d).  The underwriters of the Company’s stock are intended third party beneficiaries of this Section 9(d) and will have the right, power and authority to enforce the provisions hereof as though they were a party hereto.
10.    TRANSFERABILITY.  Except as otherwise provided in this Section 10, your option is not transferable, except by will or by the laws of descent and distribution, and is exercisable during your life only by you.  
(a)    Certain Trusts.  Upon receiving written permission from the Board or its duly authorized designee, you may transfer your option to a trust if you are considered to be the sole beneficial owner (determined under Section 671 of the Code and applicable state law) while the option is held in the trust.  You and the trustee must enter into transfer and other agreements required by the Company.  
(b)    Domestic Relations Orders.  Upon receiving written permission from the Board or its duly authorized designee, and provided that you and the designated transferee enter into transfer and other agreements required by the Company, you may transfer your option pursuant to the terms of a domestic relations order, official marital settlement agreement or other divorce or separation instrument as permitted by Treasury Regulation 1.421-1(b)(2) that contains the information required by the Company to effectuate the transfer.  You are encouraged to discuss the proposed terms of any division of this option with the Company prior to finalizing the domestic relations order or marital settlement agreement to help ensure the required information is contained within the domestic relations order or marital settlement agreement.  If this option is an Incentive Stock Option, this option may be deemed to be a Nonstatutory Stock Option as a result of such transfer.

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(c)    Beneficiary Designation.  Upon receiving written permission from the Board or its duly authorized designee, you may, by delivering written notice to the Company, in a form approved by the Company and any broker designated by the Company to handle option exercises, designate a third party who, on your death, will thereafter be entitled to exercise this option and receive the Common Stock or other consideration resulting from such exercise.  In the absence of such a designation, your executor or administrator of your estate will be entitled to exercise this option and receive, on behalf of your estate, the Common Stock or other consideration resulting from such exercise.
11.    OPTION NOT A SERVICE CONTRACT.  Your option is not an employment or service contract, and nothing in your option will be deemed to create in any way whatsoever any obligation on your part to continue in the employ of the Company or an Affiliate, or of the Company or an Affiliate to continue your employment.  In addition, nothing in your option will obligate the Company or an Affiliate, their respective stockholders, boards of directors, officers or employees to continue any relationship that you might have as a Director or Consultant for the Company or an Affiliate.
12.    WITHHOLDING OBLIGATIONS.
(a)    At the time you exercise your option, in whole or in part, and at any time thereafter as requested by the Company, you hereby authorize withholding from payroll and any other amounts payable to you, and otherwise agree to make adequate provision for (including by means of a “same day sale” pursuant to a program developed under Regulation T as promulgated by the Federal Reserve Board to the extent permitted by the Company), any sums required to satisfy the federal, state, local and foreign tax withholding obligations of the Company or an Affiliate, if any, which arise in connection with the exercise of your option.  
(b)    If this option is a Nonstatutory Stock Option, then upon your request and subject to approval by the Company, and compliance with any applicable legal conditions or restrictions, the Company may withhold from fully vested shares of Common Stock otherwise issuable to you upon the exercise of your option a number of whole shares of Common Stock having a Fair Market Value, determined by the Company as of the date of exercise, not in excess of the minimum amount of tax required to be withheld by law (or such lower amount as may be necessary to avoid classification of your option as a liability for financial accounting purposes).  If the date of determination of any tax withholding obligation is deferred to a date later than the date of exercise of your option, share withholding pursuant to the preceding sentence shall not be permitted unless you make a proper and timely election under Section 83(b) of the Code, covering the aggregate number of shares of Common Stock acquired upon such exercise with respect to which such determination is otherwise deferred, to accelerate the determination of such tax withholding obligation to the date of exercise of your option.  Notwithstanding the filing of such election, shares of Common Stock shall be withheld solely from fully vested shares of Common Stock determined as of the date of exercise of your option that are otherwise issuable to you upon such exercise.  Any adverse consequences to you arising in connection with such share withholding procedure shall be your sole responsibility.
(c)    You may not exercise your option unless the tax withholding obligations of the Company and/or any Affiliate are satisfied.  Accordingly, you may not be able to exercise your option when desired even though your option is vested, and the Company will have no obligation to issue a certificate for such shares of Common Stock or release such shares of Common Stock from any escrow provided for herein, if applicable, unless such obligations are satisfied.
13.    TAX CONSEQUENCES. You hereby agree that the Company does not have a duty to design or administer the Plan or its other compensation programs in a manner that minimizes your tax liabilities. You will not make any claim against the Company, or any of its Officers, Directors, Employees or Affiliates related to tax liabilities arising from your option or your other compensation. In particular, you acknowledge 

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that this option is exempt from Section 409A of the Code only if the exercise price per share specified in the Grant Notice is at least equal to the “fair market value” per share of the Common Stock on the Date of Grant and there is no other impermissible deferral of compensation associated with the option. 
14.    NOTICES.  Any notices provided for in your option or the Plan will be given in writing (including electronically) and will be deemed effectively given upon receipt or, in the case of notices delivered by mail by the Company to you, five (5) days after deposit in the United States mail, postage prepaid, addressed to you at the last address you provided to the Company.  The Company may, in its sole discretion, decide to deliver any documents related to participation in the Plan and this option by electronic means or to request your consent to participate in the Plan by electronic means.  By accepting this option, you consent to receive such documents by electronic delivery and to participate in the Plan through an on-line or electronic system established and maintained by the Company or another third party designated by the Company.
15.    GOVERNING PLAN DOCUMENT.  Your option is subject to all the provisions of the Plan, the provisions of which are hereby made a part of your option, and is further subject to all interpretations, amendments, rules and regulations, which may from time to time be promulgated and adopted pursuant to the Plan.  If there is any conflict between the provisions of your option and those of the Plan, the provisions of the Plan will control.  In addition, your option (and any compensation paid or shares issued under your option) is subject to recoupment in accordance with The Dodd–Frank Wall Street Reform and Consumer Protection Act and any implementing regulations thereunder, any clawback policy adopted by the Company and any compensation recovery policy otherwise required by applicable law.
16.    OTHER DOCUMENTS.  You hereby acknowledge receipt of and the right to receive a document providing the information required by Rule 428(b)(1) promulgated under the Securities Act, which includes the Plan prospectus.  In addition, you acknowledge receipt of the Company’s policy permitting certain individuals to sell shares only during certain “window” periods and the Company’s insider trading policy, in effect from time to time.
17.    EFFECT ON OTHER EMPLOYEE BENEFIT PLANS.  The value of this option will not be included as compensation, earnings, salaries, or other similar terms used when calculating your benefits under any employee benefit plan sponsored by the Company or any Affiliate, except as such plan otherwise expressly provides. The Company expressly reserves its rights to amend, modify, or terminate any of the Company’s or any Affiliate’s employee benefit plans.
18.    VOTING RIGHTS.  You will not have voting or any other rights as a stockholder of the Company with respect to the shares to be issued pursuant to this option until such shares are issued to you.   Upon such issuance, you will obtain full voting and other rights as a stockholder of the Company.  Nothing contained in this option, and no action taken pursuant to its provisions, will create or be construed to create a trust of any kind or a fiduciary relationship between you and the Company or any other person.
19.    SEVERABILITY.  If all or any part of this Option Agreement or the Plan is declared by any court or governmental authority to be unlawful or invalid, such unlawfulness or invalidity will not invalidate any portion of this Option Agreement or the Plan not declared to be unlawful or invalid.  Any Section of this Option Agreement (or part of such a Section) so declared to be unlawful or invalid shall, if possible, be construed in a manner which will give effect to the terms of such Section or part of a Section to the fullest extent possible while remaining lawful and valid.
20.    MISCELLANEOUS.

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(a)    The rights and obligations of the Company under your option will be transferable to any one or more persons or entities, and all covenants and agreements hereunder will inure to the benefit of, and be enforceable by the Company’s successors and assigns. 
(b)    You agree upon request to execute any further documents or instruments necessary or desirable in the sole determination of the Company to carry out the purposes or intent of your option.
(c)    You acknowledge and agree that you have reviewed your option in its entirety, have had an opportunity to obtain the advice of counsel prior to executing and accepting your option, and fully understand all provisions of your option.
(d)    This Option Agreement will be subject to all applicable laws, rules, and regulations, and to such approvals by any governmental agencies or national securities exchanges as may be required.
(e)    All obligations of the Company under the Plan and this Option Agreement will be binding on any successor to the Company, whether the existence of such successor is the result of a direct or indirect purchase, merger, consolidation, or otherwise, of all or substantially all of the business and/or assets of the Company.

*    *    *

This Option Agreement will be deemed to be signed by you upon the signing by you of the Stock Option Grant Notice to which it is attached. 

7.

FLEX PHARMA, INC. 
STOCK OPTION GRANT NOTICE 
(2015 EQUITY INCENTIVE PLAN)
Flex Pharma, Inc. (the “Company”), pursuant to its 2015 Equity Incentive Plan (the “Plan”), hereby grants to Optionholder an option to purchase the number of shares of the Company’s Common Stock set forth below.  This option is subject to all of the terms and conditions as set forth in this notice, in the Option Agreement, the Plan and the Notice of Exercise, all of which are attached hereto and incorporated herein in their entirety.  Capitalized terms not explicitly defined herein but defined in the Plan or the Option Agreement will have the same definitions as in the Plan or the Option Agreement. If there is any conflict between the terms in this notice and the Plan, the terms of the Plan will control.

	
		
	Optionholder:
	 

	Date of Grant:
	 

	Vesting Commencement Date:
	 

	Number of Shares Subject to Option:
	 

	Exercise Price (Per Share):
	 

	Total Exercise Price:
	 

	Expiration Date:
	 

Type of Grant:     ̈  Incentive Stock Option      ̈  Nonstatutory Stock Option
Exercise Schedule:     ̈  Same as Vesting Schedule       ̈  Early Exercise Permitted
		
	Vesting Schedule: 
	[One-fourth (1/4th) of the shares vest one year after the Vesting Commencement Date; the balance of the shares vest in a series of thirty-six (36) successive equal monthly installments measured from the first anniversary of the Vesting Commencement Date, subject to Optionholder’s Continuous Service as of each such date.]

Payment:     By one or a combination of the following items (described in the Option Agreement):
ý     By cash, check, bank draft or money order payable to the Company
ý    Pursuant to a Regulation T Program if the shares are publicly traded
ý    By delivery of already-owned shares if the shares are publicly traded
ý    If and only to the extent this option is a Nonstatutory Stock Option, and subject to the Company’s consent at the time of exercise, by a “net exercise” arrangement

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Additional Terms/Acknowledgements:  Optionholder acknowledges receipt of, and understands and agrees to, this Stock Option Grant Notice, the Option Agreement and the Plan.  Optionholder acknowledges and agrees that this Stock Option Grant Notice and the Option Agreement may not be modified, amended or revised except as provided in the Plan.  Optionholder further acknowledges that as of the Date of Grant, this Stock Option Grant Notice, the Option Agreement, and the Plan set forth the entire understanding between Optionholder and the Company regarding this option award and supersede all prior oral and written agreements, promises and/or representations on that subject with the exception of (i) options previously granted and delivered to Optionholder, (ii) any compensation recovery policy that is adopted by the Company or is otherwise required by applicable law and (iii) any written employment or severance arrangement that would provide for vesting acceleration of this option upon the terms and conditions set forth therein.  By accepting this option, Optionholder consents to receive such documents by electronic delivery and to participate in the Plan through an on-line or electronic system established and maintained by the Company or another third party designated by the Company.
	
		
	FLEX PHARMA, INC.
By:                                                                                   
Signature
Title:                                                                               
Date:                                                                               
	OPTIONHOLDER:
                                                                                           
Signature
Date:                                                                                   

ATTACHMENTS:  Option Agreement, 2015 Equity Incentive Plan and Notice of Exercise

9.

ATTACHMENT I
OPTION AGREEMENT

10.

ATTACHMENT II
2015 EQUITY INCENTIVE PLAN

11.

ATTACHMENT III
NOTICE OF EXERCISE
FLEX PHARMA, INC.
800 Boylston Street, 24th Floor
Boston, MA 02481    Date of Exercise: _______________

Ladies and Gentlemen:
This constitutes notice under my stock option that I elect to purchase the number of shares for the price set forth below.
	
			
	Type of option (check one):
	Incentive   ̈
	Nonstatutory   ̈

	Stock option dated:
	_______________
	 

	Number of shares as 
to which option is 
exercised:
	_______________
	 

	Certificates to be 
issued in name of:
	_______________
	 

	Total exercise price:
	$______________
	 

	Cash payment delivered 
herewith:
	$______________
	 

By this exercise, I agree (i) to provide such additional documents as you may require pursuant to the terms of the 2015 Equity Incentive Plan, (ii) to provide for the payment by me to you (in the manner designated by you) of your withholding obligation, if any, relating to the exercise of this option, and (iii) if this exercise relates to an incentive stock option, to notify you in writing within fifteen (15) days after the date of any disposition of any of the shares of Common Stock issued upon exercise of this option that occurs within two (2) years after the date of grant of this option or within one (1) year after such shares of Common Stock are issued upon exercise of this option.
Very truly yours,
                    

Address:

                    

                    

                    

12.Exhibit 10.1

 

EMPLOYMENT AGREEMENT

 

This Employment Agreement
(this “Agreement”) is made as of March 23, 2015, by and among CannLabs, Inc., a Nevada corporation (the “Employer”),
and GENIFER MURRAY (the “Executive”).

 

RECITALS

 

WHEREAS, the Employer
considers it essential and in the best interest of the stockholders to foster the employment of key management personnel and desires
to engage the services of the Executive on the terms and conditions hereinafter set forth; and

 

WHEREAS, Executive
desires to render services to the Employer on the terms and conditions provided in this Agreement.

 

NOW, THEREFORE, in
consideration of the mutual covenants and agreements herein contained, the parties hereto, intending to be legally bound hereby,
agree as follows:

 

The parties, intending
to be legally bound, agree as follows:

 

1.           DEFINITIONS

 

For the purposes of this
Agreement, the following terms have the meanings specified or referred to in this Section 1:

 

“Agreement”
means this Employment Agreement, as amended from time to time.

 

“Basic Compensation”
shall include all items of base and bonus compensation, benefits and signing benefits provided for in Section 3.1 of this Agreement.

 

“Benefits”
is defined in Section 3.1(c).

 

“Board of Directors”
means the board of directors of Employer.

 

“Change
of Control” shall mean (i) the closing of the sale, transfer or other disposition of all or substantially all of the Employer’s
assets, (ii) the consummation of the merger or consolidation of the Employer with or into another entity (except a merger or consolidation
in which the holders of capital stock of the Employer immediately prior to such merger or consolidation continue to hold not less
than fifty percent (50%) of the voting power of the capital stock of the Employer or the surviving or acquiring entity immediately
following such merger or consolidation), or (iii) a liquidation, dissolution or winding up of the Employer; provided, however,
that a transaction shall not constitute a Change of Control if its sole purpose is to change the state of the Employer’s
incorporation or to create a holding company that will be owned in substantially the same proportions by the persons who held the
Employer’s securities immediately prior to such transaction.

 

    	 

    	 

    

 

“Code” means
the Internal Revenue Code of 1986, as amended.

 

“Disability”
shall mean once the Executive is unable for the “Disability Period” (as hereafter defined) to perform the essential
functions of the Executive’s duties with reasonable accommodation. The disability of the Executive will be determined by
a medical doctor selected by written agreement of the Employer and the Executive upon the request of either party by notice to
the other. If the Employer and the Executive cannot agree on the selection of a medical doctor, each of them will select a medical
doctor and the two medical doctors will attempt to make a determination of disability. If they cannot agree, they will select a
third medical doctor who will determine whether the Executive has a disability. The determination of the third medical doctor selected
under this provision will be binding on both parties. The Executive must submit to a reasonable number of examinations by the medical
doctor making the determination of disability under this provision, and the Executive hereby authorizes the disclosure and release
to the Employer of such determination and all supporting medical records. If the Executive is not legally competent, the Executive’s
legal guardian or duly authorized attorney-in-fact will act in the Executive’s stead for the purposes of submitting the Executive
to the examinations, and providing the authorization of disclosure, required under this provision.

 

“Disability Period”
shall mean 180 consecutive days or such lesser number of days as elapse until disability insurance benefits commence under any
disability insurance coverage furnished by Employer to Executive, if any.

 

“Effective Date”
means June 11, 2014.

 

“Employment Period”
means the term of the Executive’s employment under this Agreement as defined in Section 2.2.

 

“For Cause”
shall mean: (a) the Executive’s conviction of or plea of guilty to a crime that constitutes a felony only if such felony
materially impairs the Executive’s ability to perform services for the Employer; (b) a breach of fiduciary duty for personal
profit; (c) fraud, dishonesty or other acts of willful misconduct in the rendering of services on behalf of the Employer or relating
to the Executive’s employment; (d) willful misconduct by the Executive which would cause the Employer to violate any state
or federal law relating to sexual harassment or age, sex or other prohibited discrimination or any violation of written policy
of the Employer or any successor entity adopted in respect to such law; (e) failure to follow the lawful instructions of the Board
of Directors of the Employer, provided compliance with such directive was reasonably within the scope of the Executive’s
duties and the Executive was given written notice that his or her conduct could give rise to termination and such conduct is not,
or could not be cured; or (f) any violation by the Executive of the terms of this Agreement; provided, however, that in order to
terminate Executive For Cause, Employer must first provide Executive with thirty (30) days written notice of the particular For
Cause events alleged by Employer; however, in the event of a For Cause event specified at sub-sections (e) and (f) above, the thirty
(30) day notice period must be accompanied with a right to cure within such thirty (30) day period.

 

    	2

    	 

    

 

“Good Reason”
shall mean, unless Executive shall have consented in writing thereto, any of the following: (i) a reduction in Executive’s
title, duties, responsibilities or status which are inconsistent with Executive’s position with Employer; (ii) the assignment
to Executive of duties inconsistent with the duties normally assigned to Persons in offices of similar position to that of Executive;
(iii) a reduction by Employer in Executive’s Basic Compensation; (iv)  relocation of the Executive’s principal
place of employment by more than 10 miles; (v) the Employer’s failure to obtain an agreement from any successor to the Employer
to assume and agree to perform this Agreement in the same manner and to the same extent that the Employer would be required to
perform if no succession had taken place, except where such assumption occurs by operation of law; or (vi) the breach by Employer
of any agreement or obligation under this Agreement after notice and a thirty (30) day right to cure.

 

“Person”
means any individual, corporation (including any non-profit corporation), general or limited partnership, limited liability company,
joint venture, estate, trust, association, organization, or governmental body.

 

2.           EMPLOYMENT TERMS
AND DUTIES

 

2.1           EMPLOYMENT

 

Commencing on the Effective
Date, the Employer agrees to employ the Executive for the term of this Agreement upon the terms and conditions set forth in this
Agreement, and the Executive agrees to commence employment for Employer also upon the terms and conditions set forth in this Agreement.

 

2.2           TERM

 

  Subject to the provisions
of Section 6, the Employment Period for the Executive’s employment under this Agreement will be three (3) years, beginning
on the Effective Date, and shall be automatically renewed for consecutive one-year renewal terms thereafter, unless, not less than
sixty (60) days prior to the end of the original term or any renewal term, either party gives the other party written notice of
termination of employment which termination shall be effective as of the end of such original term or renewal term.

 

2.3           DUTIES

 

  The Executive will
serve as Founder and President of Employer and will perform all duties required in furtherance of her position, including without
limitation, all such duties as are customarily associated with such position or such duties as are assigned or delegated to the
Executive by the Board of Directors. The Executive agrees to perform in good faith and to the best of her ability all services
which may be required of her hereunder and will devote her full-time efforts and business time, skill, attention and energies as
are reasonably necessary to perform her duties and responsibilities under this Agreement and to promote the success of the Employer’s
business.

 

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3.           COMPENSATION

 

3.1           BASIC COMPENSATION

 

(a)   Base Salary.
The Executive will be paid an initial annual base salary of $120,000, subject to further adjustment as provided below (the “Base
Salary”), which will be payable in equal periodic installments according to the Employer’s customary payroll practices,
but no less frequently than monthly. The Executive’s Base Salary will be reviewed by Employer’s Board of Directors
not less frequently than annually, and may be adjusted by Employer but in no event will be less than $120,000 per year.

 

(b)           Bonus.
Executive shall be eligible to receive annual bonus compensation at the discretion of Employer’s Board of Directors and in
accordance with Employer’s executive bonus or incentive compensation plan that may be in effect from time to time. In addition,
Executive will be eligible to participate in an annual incentive plan which will provide an incentive payment based upon achievement
of agreed upon performance goals. The Compensation Committee of Employer will determine the goals to be measured against as well
as the target incentive (the “Target Incentive”), expressed as a percentage of base salary, to be up to 50% of Base
Salary, and in no event less than 25% of Base Salary (“Annual Bonus”) provided that the Company has positive cash flow
not to include cash flows from financing, as defined and in accordance with generally accepted accounting principles. In the event
that the Executive is employed for a partial year, she shall be entitled to such Annual Bonus as declared by the Compensation Committee
or as set forth in an incentive plan adopted by the Compensation Committee or Board of Directors, on a prorata basis for that period
of the year for which she was employed. The Annual Bonus will be paid within two and a half (2 1/2) months after the end of the
applicable calendar year.

 

(c)           Restricted
Stock Grant.  In addition to Base Salary, as part of the Executive’s overall compensation, the Executive shall
receive a restricted stock award of 1,200,000 shares of Employer’s common stock (the “Shares”). For so long
as the Executive remains continuously employed by the Employer, the Shares shall vest as follows: 50% of the Shares shall vest
immediately and the remaining 50% vest on June 12, 2015.

 

(d)           Benefits.

 

(i)           General Benefits.
The Executive will, during the Employment Period, be permitted to participate in such pension, profit sharing, bonus (subject to
the provisions of Section 3.1 (b)), life insurance, hospitalization, major medical, and other employee benefit plans of the Employer
that may be in effect from time to time, to the extent the Executive is eligible under the terms of those plans (collectively,
the “Benefits”). The Executive shall also be entitled to such other fringe benefits as are now or may become available
to all of Employer’s other Executive officers.

 

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(ii)           Life and Disability
Insurance. During the term of this Agreement, the Employer shall pay Executive an annual amount not to exceed $2,500 per annum
(prorated for less than annual periods) to reimburse Executive for the cost of Executive securing life or disability insurance
policies in an amount and to the extent Executive may select.

 

(e)           Signing Bonus.
The Executive shall be paid a one-time transition bonus of Fifty Thousand Dollars ($50,000) in conjunction with raising a minimum
of $500,000 in capital.

 

4.           EXPENSE REIMBURSEMENT

 

The Employer will pay
reasonable expenses incurred by the Executive in the performance of the Executive’s duties pursuant to this Agreement, including
without limitation reasonable expenses incurred by the Executive in attending conventions, other business meetings and for promotional
expenses, provided that any such activities must be related to Employer’s business. All individual expenses (or those aggregated
for a single convention, seminar or other business trip, excluding airfare and hotel expenses) greater than $3,000 must be approved
by either Employer’s Chief Financial Officer or its Board of Directors.

 

5.           VACATIONS AND
HOLIDAYS

 

The Executive will be
entitled to four (4) weeks paid vacation each calendar year, but in no event more than two (weeks) consecutively in accordance
with the vacation policies of the Employer in effect for its Executive officers from time to time. The Executive will also be entitled
to the paid holidays and other paid leave set forth in the Employer’s policies. Vacation days during any calendar year that
are not used by the Executive by March 31st of the following calendar year shall be forfeited.

 

6.           TERMINATION

 

6.1         EVENTS OF TERMINATION

 

The Executive’s
employment pursuant to this Agreement may be terminated by Employer on the following grounds:

 

(a)           upon the death
of the Executive;

 

(b)           upon the Disability
of the Executive immediately upon notice from either party to the other;

 

(c)           For Cause (following
the expiration of any applicable notice period from Employer to Executive);

 

		(d)	 at the discretion of Employer other than For Cause.

 

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The Executive may terminate
her employment on the following grounds:

 

(e)           without Good
Reason, provided that Executive gives Employer at least thirty (30) days prior written notice of her termination of employment;
or

 

(f)           for Good Reason
(following the expiration of any applicable notice period from Executive to Employer).

 

6.2         
TERMINATION PAY

 

Effective upon the
termination of this Agreement, the Employer will be obligated to pay the Executive (or, in the event of her death, her designated
beneficiary as defined below) the compensation provided in this Section 6.2:

 

(a)           Termination by the Employer
For Cause or Termination by Executive Without Good Reason. If the Employer terminates this Agreement For Cause or Executive
resigns or terminates her employment for other than Good Reason, the Executive will be entitled to receive her (i) Basic Compensation
only through the date such termination is effective, (ii) any current and carried-over unused vacation days, and (iii) unpaid but
accrued reimbursement for travel and business expenses. Executive will not be entitled to any accrued bonus compensation for the
calendar year during which such termination occurs, however, will be entitled to retain any bonus compensation paid prior to such
termination. Executive’s options or restricted stock grants will be treated, in this case, as set forth in any option or
restricted stock grant agreement between Executive and Employer.

 

(b)           Termination
upon Disability. If this Agreement is terminated by either party as a result of the Executive’s Disability, the Executive
will be entitled to receive her (i) Basic Compensation and Benefits for twelve (12) months from the date such termination is effective,
(ii) any current and carried-over unused vacation days, and (iii) unpaid but accrued reimbursement for travel and business expenses.
Executive shall also be entitled to receive that part of the Executive’s accrued bonus compensation, if any, for the calendar
year during which her Disability occurs, prorated through the end of the calendar quarter during which her termination is effective.
If this Agreement is terminated as a result of the Executive’s Disability, Executive shall fully vest in 100% of all options
which Executive received in connection with her employment by Employer, and Executive shall have the full term of such options
in which to exercise any or all of them, notwithstanding any accelerated exercise period contained in any such option.

 

(c)           Termination
upon Death. If this Agreement is terminated because of the Executive’s death, Employer will continue to pay Executive’s
estate her (i) Basic Compensation for twelve (12) months from the date such termination is effective, (ii) any current and carried-over
unused vacation days, (iii) unpaid but accrued reimbursement for travel and business expenses, and (iv) that part of the Executive’s
accrued bonus compensation, if any, for the calendar year during which her death occurs, prorated through the end of the calendar
quarter during which her death occurs. If this Agreement is terminated as a result of the Executive’s death, Executive shall
fully vest in 100% of all options and restricted stock grants which Executive received in connection with her employment by Employer,
and Executive shall have the full term of such options in which to exercise any or all of them, notwithstanding any accelerated
exercise period contained in any such option.

 

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(d)            Termination by Executive
For Good Reason or Termination by Employer Without Cause. If this Agreement is terminated by Executive for Good Reason, or
if this Agreement is terminated by Employer other than For Cause then Employer shall pay to Executive (i) Base Salary and Benefits
for a period of twelve (12) months, (ii) unpaid but accrued reimbursement for travel and business expenses, and (iii) that part
of the Executive’s accrued bonus compensation, if any, for the calendar year during which termination under this Section
6(d) occurs. All options and restricted stock grants in Employer which Executive received in connection with her employment by
Employer shall immediately vest and Executive shall have the full term of such options in which to exercise any or all of them,
notwithstanding any accelerated exercise period contained in any such option.

(e)            Acceleration
of Vesting. If this Agreement is terminated by Employer other than for Cause within initial six (6) months of Term, 200,000
Shares shall automatically vest.  If this Agreement is terminated by Employer without cause after first 6 months of the
Term, an additional 33,333 Shares shall vest for each month of service beyond initial 6 months of Term. If terminated upon a Change
of Control, vesting of all Shares shall immediately accelerate.

 

7.            SECTION
409A.

 

(a)           This Agreement
is intended to comply with the requirements of Code Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”).
Payments of Non-Qualified Deferred Compensation (as such term is defined under Code Section 409A and the regulations promulgated
thereunder) may only be made under this Agreement upon an event and in a manner permitted by Code Section 409A. Any amounts payable
solely on account of an involuntary separation from service of Executive within the meaning of Code Section 409A shall be excludible
from the requirements of Code Section 409A, either as involuntary separation pay or as short-term deferral amounts, to the maximum
possible extent. For purposes of Code Section 409A, the right to a series of installment payments under this Agreement shall be
treated as a right to a series of separate payments. All reimbursements and in-kind benefits provided under this Agreement shall
be made or provided in accordance with Code Section 409A including, where applicable, the requirement that (i) any reimbursement
is for expenses incurred during the period of time specified in this Agreement, (ii) the amount of expenses available for reimbursement,
or the in-kind benefits provided, during a calendar year may not affect the expenses eligible for reimbursement, or in-kind benefits
provided, in any other calendar year, (iii) the reimbursement of an eligible expense will be made no later than the last day of
the calendar year following the year in which the expense in incurred, and (iv) the right to reimbursement or in-kind benefits
is not subject to liquidation or exchange for another benefit.

 

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(b)           To the extent
required by Code Section 409A, and notwithstanding any other provision of this Agreement to the contrary, no payment of Non-Qualified
Deferred Compensation will be provided to, or with respect to, the Executive on account of her separation from service until the
first to occur of (i) the date of Executive’s death or (ii) the date which is one day after the six (6) month anniversary
of her separation from service, and in either case only if she is a “specified employee” (as defined under Code Section
409A(a)(2)(B)(i) of the Code and the regulations promulgated thereunder) in the year of her separation from service. Any payment
that is delayed pursuant to the provisions of the immediately preceding sentence shall instead be paid in a lump sum (subject to
all applicable withholding) promptly following the first to occur of the two dates specified in such immediately preceding sentence.

(c)           Any payment of
Non-Qualified Deferred Compensation made under Section 4 pursuant to a voluntary or involuntary termination of Executive’s
employment with the Employer shall be withheld until Executive incurs both (i) a termination of her employment relationship with
the Employer and (ii) the first instance of a “separation from service” with the Employer, as such term is defined
in Treas. Reg. Section 1.409A-1(h).

 

(d)           The preceding
provisions of this Section 7 shall not be construed as a guarantee by the Employer of any particular tax effect to Executive under
this Agreement, under any plan or program sponsored or maintained by the Employer or under any other agreement by and between Executive
and the Employer. The Employer shall not be liable to Executive for any additional tax, penalty or interest imposed under Code
Section 409A nor for reporting in good faith any payment made under this Agreement or under any such other plan, program or agreement
as an amount includible in gross income under Code Section 409A.

 

8.           CHARACTER OF
TERMINATION PAYMENTS; MITIGATION

 

 The amounts payable
to Executive upon any termination of this Agreement shall be considered severance pay in consideration of past services rendered
on behalf of the Employer and her continued service from the date hereof to the date she becomes entitled to such payments. Executive
shall have no duty to mitigate her damages by seeking other employment and, should Executive actually receive compensation from
any such other employment, the payments required hereunder shall not be reduced or offset by any such other compensation.

 

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		9.	CONFIDENTIALITY AND RELATED MATTERS.

 

9.1           NON-DISCLOSURE
COVENANT

 

Employer and the Executive
acknowledge that the services to be performed by the Executive under this Agreement are unique and valuable and that, as a result
of the Executive’s employment, the Executive will be in a relationship of confidence and trust with Employer and will come
into possession of “Confidential Information” (i) owned or controlled by Employer and its subsidiaries and affiliates;
(ii) in the possession of Employer and its subsidiaries and affiliates and belonging to third parties; or (iii) conceived, originated,
discovered or developed, in whole or in part, by the Executive during the term of this Agreement and relating to her duties for
the Employer under this Agreement. As used herein “Confidential Information” means trade secrets and other confidential
or proprietary business, technical, personnel or financial information of Employer, whether or not the Executive’s work product,
in written, graphic, oral or other tangible or intangible forms, including but not limited to specifications, samples, records,
data, computer programs, drawings, diagrams, models, consumer names, ID’s or e-mail addresses, business or marketing plans,
studies, analyses, projections and reports, communications by or to attorneys (including attorney-client privileged communications),
memos and other materials prepared by attorneys or under their direction (including attorney work product), and software systems
and processes that are not readily available to the public, even it is not specifically marked as a trade secret or confidential,
unless Employer advises the Executive otherwise in writing or unless the information has been shared by Employer with entities
not bound by non-disclosure agreements. In consideration of the compensation and benefits to be paid or provided to the Executive
by the Employer under this Agreement, the Executive agrees not to directly or indirectly use or disclose to anyone, either during
the Employment Period or after the termination of this Agreement, except in the performance of her duties of her employment with
Employer or with Employer’s prior written consent, any Confidential Information of Employer. This non-disclosure covenant
does not apply to information that is disclosed or becomes public through another source that is not bound by a confidentiality
agreement with Employer; which Executive is required to disclose pursuant to court order, subpoena or applicable law (provided
that Executive will use reasonable efforts to provide Employer with prompt notice of any such requests or requirement so that Employer
may seek an appropriate protective order); or which is disclosed in any proceeding to enforce or interpret this Agreement. The
Executive agrees that in the event of the termination of the Executive’s employment for any reason, the Executive will deliver
to Employer, upon request, all property belonging to Employer, including all documents and materials of any nature pertaining to
the Executive’s work with Employer and will not take with her any documents or materials of any description, or any reproduction
thereof of any description, containing or pertaining to any Confidential Information.

 

		9.2	WORK MADE FOR HIRE

 

Executive recognizes
and understands that Executive’s duties at the Employer may include the preparation of materials, including without limitation
written or graphic materials, and that any such materials conceived or written by Executive shall be done as “work made for
hire” as defined and used in the Copyright Act of 1976, 17 U.S.C. §§ 1 et seq. In the event
of publication of such materials, Executive understands that since the work is a “work made for hire”, the Employer
will solely retain and own all rights in said materials, including right of copyright.

 

		9.3	DISCLOSURE OF WORKS AND INVENTIONS/ASSIGNMENT OF PATENTS

 

In consideration of
the promises set forth herein, Executive agrees to disclose promptly to the Employer, or to such person whom the Employer may expressly
designate for this specific purpose (its “Designee”), any and all works, inventions, discoveries and improvements authored,
conceived or made by Executive during the period of employment and related to the business or activities of the Employer, and Executive
hereby assigns and agrees to assign all of Executive’s interest in the foregoing to the Employer or to its Designee. Executive
agrees that, whenever she is requested to do so by the Employer, Executive shall execute any and all applications, assignments
or other instruments which the Employer shall deem necessary to apply for and obtain Letters Patent or Copyrights of the United
States or any foreign country or to otherwise protect the Employer’s interest therein. Such obligations shall continue beyond
the termination or nonrenewal of Executive’s employment with respect to any works, inventions, discoveries and/or improvements
that are authored, conceived of, or made by Executive during the period of Executive’s employment, and shall be binding upon
Executive’s successors, assigns, executors, heirs, administrators or other legal representatives.

 

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		10.	NON-COMPETITION AND NON-SOLICITATION MATTERS

 

		10.1	NON-COMPETITION

 

During the term of this
Agreement the Executive agrees that she shall not work for or be interested in any business within 200 miles of any facility owned
by the which acts as an independent marijuana testing lab during her Term of employment or for twelve (12) months following Executive’s
termination (the “Non-Compete Period”). For the purposes of this Agreement, the term “work for or be interested
in any business” means that the Executive is a stockholder, director, officer, employee, partner or individual proprietor,
with that business, but not if her interest is limited solely to the passive ownership of five percent (5%) or less of any class
of the equity or debt securities of a corporation whose shares are listed for trading on a national securities exchange or traded
in the over-the-counter market. In the event that any part of this Section 9 is adjudged invalid or unenforceable by any court
of record, board of arbitration or judicial or quasi-judicial entity having jurisdiction thereof by reason of length of time, geographical
coverage, activities covered, or for any other reason, then the invalid or unenforceable provisions of this covenant shall be deemed
reformed and amended to the maximum extent permissible under applicable law and shall be enforced and enforceable as so amended
in accordance with the intention of the parties as expressed herein.

 

		10.2	NON-SOLICITATION

 

During the Non-Compete
Period, the Executive also agrees that she will not directly or indirectly: (i) solicit the trade of, or trade with, any past,
present or prospective customer of the Employer for any business purpose that directly competes with the business of Employer or
a subsidiary or affiliate of Employer; or (ii) solicit or induce, or attempt to solicit or induce, any employee of Employer to
leave Employer for any reason whatsoever, or assist or participate in the hiring of any employee of Employer to work for another
entity.

 

11.           REPRESENTATIONS
OF EXECUTIVE

 

As a material
inducement to Employer to execute this Agreement and consummate the transactions contemplated thereby, the Executive hereby makes
the following representations to Employer, each of which are true and correct in all material respects as of the date hereof.

 

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11.1            QUESTIONNAIRE

 

  
On or before the date hereof Executive has completed and returned to Employer a Directors and Officers Questionnaire (the
“Questionnaire”) which is true and correct in all material respects.

 

11.2            NO
PRIOR AGREEMENTS

 

  Executive
represents and warrants that Executive is not a party to or otherwise subject to or bound by the terms of any contract, agreement
or understanding which in any manner would limit or otherwise affect Executive’s ability to perform her obligations hereunder,
including without limitation any contract, agreement or understanding containing terms and provisions similar in any manner to
those contained in Sections 9 and 10 of this Agreement. Executive further represents and warrants that her employment with the
Employer will not under any circumstances require her to disclose or use any confidential information belonging to prior Employers
or other persons or entities, or to engage in any conduct which may potentially interfere with the contractual, statutory or common-law
rights of such other Employers, persons or entities. In the event that Executive knows or learns of any facts whatsoever which
suggest that such interference might arguably occur as the result of any proposed actions by either Executive or the Employer,
Executive expressly promises that she will immediately bring such facts to the Employer’s attention.

 

11.3            REVIEW
BY COUNSEL

 

  
 Executive expressly acknowledges and represents that Executive has been given a full and fair opportunity to review this
Agreement with an attorney of Executive’s choice, and that Executive has satisfied herself, with or without consulting
with counsel, that the terms and provisions of this Agreement, specifically including, but not limited to, the restrictive
covenant and related provisions of Section 10 hereof, are reasonable and enforceable.

 

11.4            NO
CONFLICTS OF INTEREST

 

     Executive covenants
that, as of the date hereof, she is not involved in any venture or activity that could compete with Employer or which could potentially
interfere with her ability to perform under this Agreement. During the Term, she will disclose to the Employer, in writing, any
and all interests she may have, whether for profit or compensation or not, in any venture or activity which could potentially interfere
with her ability to perform under this Agreement or create a conflict of interest for her with the Employer. For purposes of this
Section 11.4 only, “conflict of interest” shall mean ownership of greater than one percent (1%) of, or $25,000 worth
of equity in, another company which conducts business similar to that undertaken by the Employer.

 

11.5            EXECUTIVE’S
ABILITY

     Executive represents
that Executive’s experience and capabilities, and the limited provisions of Section 10, are such that she will not be prevented
from earning her livelihood in businesses similar to that of Employer. Executive acknowledges that there are a significant number
of businesses for which her qualifications and experience would render her qualified for employment that do not constitute a competing
businesses such that her ability to become employed after the termination or nonrenewal of this Agreement would not be impaired.

 

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		12.	CHANGE OF CONTROL

 

In the event of a change of control, all unvested
shares and/or options will vest immediately.

 

13.           GENERAL PROVISIONS

 

  13.1      INJUNCTIVE RELIEF
AND ADDITIONAL REMEDY

 

The Executive acknowledges
that the injury that would be suffered by the Employer as a result of a breach of the provisions of any provision of Sections 9
and 10 of this Agreement would be irreparable and that an award of monetary damages to the Employer for such a breach would be
an inadequate remedy. Consequently Employer will have the right, in addition to any other rights it may have, to obtain injunctive
relief to restrain any breach or threatened breach or otherwise to specifically enforce any provisions of Sections 9 and 10 of
this Agreement.

 

  13.2      WAIVER

 

The rights and remedies
of the parties to this Agreement are cumulative and not alternative. Neither the failure nor any delay by either party in exercising
any right, power, or privilege under this Agreement will operate as a waiver of such right, power, or privilege, and no single
or partial exercise of any such right, power, or privilege will preclude any other or further exercise of such right, power, or
privilege or the exercise of any other right, power, or privilege.

 

  13.3      Intentionally
Omitted.

 

  13.4      EMPLOYER VIOLATION
NOT A DEFENSE

 

In an action by the
Employer to enforce paragraphs 9 or 10 of this Agreement, any claims asserted by Executive against the Employer shall not constitute
a defense to the Employer’s action.

 

  13.5      INDEMNIFICATION

 

Employer shall indemnify
and defend Executive and his heirs, executors and administrators against any costs or expense (including reasonable attorneys’
fees and amounts paid in settlement, if such settlement is approved by the Employer), fine, penalty, judgment and liability reasonable
incurred by or imposed upon Executive in connection with any action, suit or proceeding, civil or criminal, to which Executive
may be made a party or with which Executive shall be threatened, by reason of Executive’s being or having been an officer
or director, unless with respect to such matter Executive shall have been adjudicated in any proceeding not to have acted in good
faith or in the reasonable belief that the action was in the best interests of the Employer, or unless such indemnification is
precluded by law, public policy.

 

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13.6           NOTICES

 

   All notices, consents,
waivers, and other communications under this Agreement must be in writing and will be deemed to have been duly given when (a) delivered
by hand, (b) sent by facsimile (with written confirmation of receipt), provided that a copy is mailed by registered mail, return
receipt requested, or (c) when received by the addressee, if sent by a nationally recognized overnight delivery service (receipt
requested), in each case to the appropriate addresses and facsimile numbers set forth below (or to such other addresses and facsimile
numbers as a party may designate by notice to the other parties):

 

	If to Employer:	CannLabs, Inc.
	 	3888 E. Mexico Ave., Suite B50
	 	Denver, CO 80210
	 	Telephone No.:  303.309.0105
	 	Facsimile No.:
	 	Attn:  President
	 	 
	If to Executive:	Genifer Murray

            

13.7           ENTIRE AGREEMENT;
AMENDMENTS

 

   This Agreement and
the documents referenced herein, contain the entire agreement between the parties with respect to the subject matter hereof and
supersede all prior agreements and understandings, oral or written, between the parties hereto with respect to the subject matter
hereof. This Agreement may not be amended orally, but only by an agreement in writing signed by the parties hereto.

 

13.8           GOVERNING LAW

 

    This Agreement will
be governed by the laws of the State of Colorado without regard to conflicts of laws principles.

 

13.9           ARBITRATION,
OTHER DISPUTES.

 

                In the event of
any dispute or controversy arising under or in connection with this Agreement, the parties shall first promptly try in good faith
to settle such dispute or controversy by mediation under the applicable rules of the American Arbitration Association before resorting
to arbitration. In the event such dispute or controversy remains unresolved in whole or in part for a period of thirty (30) days
after it arises, the parties will settle any remaining dispute or controversy exclusively by arbitration in Las Vegas, Nevada in
accordance with the commercial arbitration rules of the American Arbitration Association then in effect. Judgment may be entered
on the arbitrator’s award in any court having jurisdiction. All administration fees and arbitration fees shall be paid solely
by Employer. Notwithstanding the above, Employer shall be entitled to seek a restraining order or injunction in any court of competent
jurisdiction to prevent any continuation of any violation of section 9 or 10 hereof. The prevailing party shall be awarded attorneys’
fees in any dispute or controversy arising under or in connection with this Agreement.

 

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13.10       ASSIGNABILITY,
BINDING NATURE

  This Agreement shall
be binding upon and inure to the benefit of the parties and their respective successors, heirs (in the case of the Executive) and
assigns. No rights or obligations of the Executive under this Agreement may be assigned or transferred by the Executive other than
her rights to compensation and benefits, which may be transferred only by will or operation of law.

 

13.11       SURVIVAL

 

  The respective rights
and obligations of the parties hereunder shall survive any termination of the Executive’s employment to the extent necessary
to the intended preservation of such rights and obligations.

 

13.12       SECTION HEADINGS,
CONSTRUCTION

 

  The headings of Sections
in this Agreement are provided for convenience only and will not affect its construction or interpretation. All references to “Section”
or “Sections” refer to the corresponding Section or Sections of this Agreement unless otherwise specified. All words
used in this Agreement will be construed to be of such gender or number as the circumstances require. Unless otherwise expressly
provided, the word “including” does not limit the preceding words or terms.

 

13.13       SEVERABILITY

 

  If any provision of
this Agreement is held invalid or unenforceable by any court of competent jurisdiction, the other provisions of this Agreement
will remain in full force and effect. Any provision of this Agreement held invalid or unenforceable only in part or degree will
remain in full force and effect to the extent not held invalid or unenforceable.

 

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13.14       COUNTERPARTS

 

  This Agreement may
be executed in one or more counterparts, each of which will be deemed to be an original copy of this Agreement and all of which,
when taken together, will be deemed to constitute one and the same agreement. This Agreement (and all other agreements, documents,
instruments and certificates executed and/or delivered in connection herewith) may be executed by facsimile signatures, each of
which shall be deemed an original copy of this Agreement (or other such agreement, document, instrument and certificate).

 

IMPORTANT NOTICE:
THIS AGREEMENT RESTRICTS EXECUTIVE’S RIGHTS TO OBTAIN OTHER EMPLOYMENT FOLLOWING HER EMPLOYMENT WITH THE EMPLOYER. BY SIGNING
IT, EXECUTIVE ACKNOWLEDGES THIS FACT, AND FURTHER ACKNOWLEDGES THAT HE HAS BEEN ADVISED BY THE EMPLOYER TO READ THE AGREEMENT CAREFULLY,
AND/OR TO CONSULT WITH COUNSEL OF HER CHOICE CONCERNING THE LEGAL EFFECTS OF SIGNING THE AGREEMENT, PRIOR TO SIGNING IT.

 

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IN WITNESS WHEREOF,
the parties have executed and delivered this Agreement as of the date first written above.

	 	 	 	 	 
	WITNESS:	 	EMPLOYER:	 
	 	 	 	 
	 	 	 	 	 
	Signature	 	CANNLABS, INC.	 
	 	 	 	 	 
	 	 	By:	/s/ Mark Mirken	 
	Print Name	 	 	Authorized Executive Officer	 
	 	 	 	 	 
	 	 	 	 	 
	Address	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	Address	 	 	 	 
	 	 	 	 	 
	 	 	EMPLOYEE:	 
	 	 	/s/ Genifer Murray	 
	 	 	Genifer Murray	 

 

 

    	16

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00242-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00242-of-00352.parquet"}]]