Document:

Exhibit 10.4

 

Executed Version

 

SUBSCRIPTION AGREEMENT

 

This SUBSCRIPTION AGREEMENT
(this “Subscription Agreement”) is entered into on October 13, 2022, by and among Innovative International Acquisition
Corp., a Cayman Islands exempted company (the “Issuer”) and the undersigned (“Subscriber”).

 

WHEREAS,
substantially concurrently with the execution and delivery of this Subscription Agreement, the Issuer is entering into that certain Agreement
and Plan of Merger and Reorganization, dated as of the date of this Subscription Agreement (as may be amended or supplemented from time
to time, the “Merger Agreement”), by and among the Issuer, Innovative International Merger Sub Inc., a Delaware
corporation and a wholly-owned subsidiary of the Issuer (“Merger Sub”), Greg Moran, acting as representative of the
Target (as defined below), and ZoomCar, Inc., a Delaware corporation (together with its direct and indirect subsidiaries, “Target”),
pursuant to which, among other things, (i) the Issuer will domesticate as a Delaware corporation in accordance with the
applicable provisions of the Delaware General Corporation Law and the Cayman Islands Companies Act (As Revised) (the “Domestication”)
and (ii) immediately following the consummation of the Domestication, Merger Sub will merge with and into Target (the “Merger”
and, together with the Domestication, the “Transactions”, and the consummation of the Merger in accordance with the
Merger Agreement, the “Merger Closing”), with the Target surviving the Merger.

 

WHEREAS, in connection with
the Transactions, the Issuer is seeking commitments from interested investors to purchase, prior to the Merger Closing, the Issuer’s
common stock, par value $0.0001 per share (the “Common Shares”); and

 

WHEREAS, in connection with
the Transactions, on the terms and subject to the conditions set forth in this Subscription Agreement, Subscriber desires to subscribe
for and purchase from the Issuer the number of Common Shares, set forth on the signature page hereto (the “Acquired Shares”)
for a purchase price of $10.00 per share (the “Share Purchase Price,” and the aggregate purchase price set forth on
the signature page hereto for the Acquired Shares, the “Purchase Price”), and the Issuer desires to issue and
sell to Subscriber the Acquired Shares in consideration of the payment of the Purchase Price by or on behalf of Subscriber to the Issuer
at or prior to the Closing Date (as defined herein);

 

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

 

1.            Subscription.
Subject to the terms and conditions hereof, Subscriber hereby irrevocably subscribes for and agrees to purchase from the Issuer, and
the Issuer hereby agrees that the Issuer shall issue and sell to Subscriber, upon the payment of the Purchase Price, the Acquired Shares
(such subscription and issuance, the “Subscription”). Subscriber acknowledges and agrees that, as a result of the
Domestication, the Acquired Shares issued pursuant hereto shall be Common Shares of the Issuer as a Delaware corporation (and not, for
the avoidance of doubt, ordinary shares of Issuer as a Cayman Islands exempted company).

 

     

     

    

 

2.            Closing.

 

2.1            Subject
to the satisfaction or waiver of the conditions set forth in Section 2 (other than those conditions that by their nature are
to be satisfied at the closing of the Subscription contemplated hereby (the “Closing”), but without affecting the requirement
that such conditions be satisfied or waived at the Closing), the Closing shall occur following the Domestication and on the date of, and
substantially concurrently with and conditioned upon, the effectiveness and closing of the Transactions and immediately prior to the Effective
Time (as defined in the Merger Agreement) (such date, the “Closing Date”) in the sequence contemplated in the recitals
to this Subscription Agreement and is contingent upon the subsequent occurrence of the consummation of the Transactions. Prior to the
anticipated Closing Date (the “Scheduled Closing Date”), the Issuer shall deliver, at least two (2) business days
prior to the Scheduled Closing Date, written notice to Subscriber (the “Closing Notice”) specifying (i) the Scheduled
Closing Date, (ii) the wire instructions for delivery of the Purchase Price to the Issuer (or, to the extent previously agreed by
the parties to the Merger Agreement, to an escrow account established by the Issuer for this purpose (if so established, the “Escrow
Account”)) and, to the extent applicable, any other information reasonably requested by the Issuer or by the escrow agent (the
 “Escrow Agent”), if any, engaged by the Issuer to establish and maintain the Escrow Account. The wire transfer shall
identify the Subscriber and, unless otherwise agreed by Issuer, the funds shall be wired from an account in the Subscriber’s name.
Upon the Closing, the Issuer shall provide instructions to the Escrow Agent, if any, to release the funds in the Escrow Account to the
Issuer against delivery to the Subscriber of the Acquired Shares. On the Closing Date, promptly after the Closing, the Issuer shall deliver
(or cause delivery of) the number of Acquired Shares set forth on the signature page to this Subscription Agreement in book entry
form with restrictive legends to the Subscriber as indicated on the signature page or to a custodian designated by the Subscriber,
as applicable, as indicated below; provided, however, that the Issuer’s obligation to issue the Acquired Shares to
the Subscriber is contingent upon the Issuer having received the Purchase Price in full accordance with this Section 2. If this Subscription
Agreement is terminated prior to the Closing and any funds have already been sent by the Investor to the Issuer or to the Escrow Agent,
as applicable, then, promptly after such termination, the Issuer will promptly return (or, to the
extent applicable, instruct the Escrow Agent to promptly return) the Purchase Price in full to the Subscriber to the account specified
in writing by the Subscriber. For the purposes of this Subscription Agreement, (x) “business day” means any other
day other than a Saturday, Sunday, legal holiday or any other day on which commercial banking institutions located in New York, New York
are required or authorized to be closed (excluding as a result of “stay at home”, “shelter-in-place”, “non-essential
employee” or any other similar orders or restrictions or the closure of any physical branch locations at the direction of any governmental
authority so long as the electronic funds transfer systems, including for wire transfers, of commercially banking institutions in New
York, New York are generally open for use by customers on such day); (y) “person” shall refer to any individual, corporation,
partnership, trust, limited liability company or other entity or association, including any governmental or regulatory body, whether acting
in an individual, fiduciary or any other capacity; and (z) “affiliate” shall mean, with respect to any specified person,
any other person or group of persons acting together that, directly or indirectly, through one or more intermediaries controls, is controlled
by or is under common control with such specified person (where the term “control” (and any correlative terms) means the possession,
direct or indirect, of the power to direct or cause the direction of the management and policies of such person, whether through the ownership
of voting securities, by contract or otherwise).

 

2.2           Subject
to the satisfaction or waiver of the conditions set forth in Section 2.3 and Section 2.4 (other than those
conditions that by their nature are to be satisfied at Closing, but without affecting the requirement that such conditions be satisfied
or waived at Closing):

 

2.2.1            Subscriber
shall deliver to the Issuer, no later than two business days before the Closing Date (as specified in the Closing Notice) or such other
date as otherwise agreed to by the Issuer and Subscriber (such date, the “Purchase Price Payment Date”) the Purchase
Price for the Acquired Shares by wire transfer of U.S. dollars in immediately available funds to the account specified by the Issuer in
the Closing Notice (which account shall be for the benefit of Subscriber until the Closing Date), and any information that is reasonably
requested in the Closing Notice that is required in order to enable the Issuer to issue the Acquired Shares, including, without limitation,
the legal name of the person (or nominee) in whose name such Acquired Shares are to be issued and a duly executed Internal Revenue Service
Form W-9 or W-8, as applicable, provided, however, in the case of a Subscriber that is an “investment company”
registered under the Investment Company Act of 1940, as amended, payment may be made to an account specified by the Issuer and subject
to such procedures otherwise mutually agreed by Subscriber and the Issuer.

 

     

     

    

 

2.2.2            Subscriber may, in lieu
of its obligation to transfer funds pursuant to Section 2.2.1, pay for the Acquired Shares by foregoing payment of all or
a portion of the payment obligations owed to Subscriber by the Target pursuant to and in accordance with the terms of that certain Note
Purchase Agreement, by Target and Subscriber, and the Promissory Note, issued by Target to Subscriber, each dated as of the date hereof.

 

2.2.3            On
the Closing Date, the Issuer shall deliver to Subscriber (i) the Acquired Shares against and upon payment by Subscriber (including
by foregoing payment under the Note Purchase Agreement and the Promissory Note as set forth in Section 2.2.2 herein) in book-entry
form, free and clear of any liens or other restrictions whatsoever (other than those arising under state or federal securities laws and
the lock-up restrictions set forth herein), in the name of Subscriber (or its nominee in accordance with its delivery instructions) or
to a custodian designated by Subscriber, as applicable and (ii) evidence from the Issuer’s transfer agent of the issuance of
the Acquired Shares were issued to Subscriber in book-entry form on and as of the Closing Date; provided, however, that the Issuer’s
obligation to issue the Acquired Shares to Subscriber is contingent upon the Issuer having received the Purchase Price in full in accordance
with this Section 2.

 

2.2.4            Each
book entry for the Acquired Shares shall contain a legend in substantially the following form:

 

THE OFFER AND SALE OF THE SECURITIES REPRESENTED
HEREBY HAS NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE OR OTHER
JURISDICTION, AND MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN EXEMPTION THEREFROM.

 

2.3            The
Issuer’s obligation to effect the Closing shall be subject to the satisfaction on the Closing Date, or, to the extent permitted
by applicable law, the waiver by the Issuer, of each of the following conditions:

 

2.3.1            all
representations and warranties of Subscriber contained in this Subscription Agreement shall be true and correct in all material respects
(other than representations and warranties that are qualified as to materiality or Subscriber Material Adverse Effect (as defined herein),
which representations and warranties shall be true and correct in all respects) at and as of the Closing Date (except for representations
and warranties made as of a specific date, which shall be true and correct in all material respects (other than representations and warranties
that are qualified as to materiality or Subscriber Material Adverse Effect, which representations and warranties shall be true and correct
in all respects) as of such date) and the consummation of the Closing shall constitute a reaffirmation by Subscriber of each of the representations
and warranties of Subscriber contained in this Subscription Agreement as of the Closing Date;

 

2.3.2            Subscriber
shall have performed, satisfied and complied in all material respects with all covenants, agreements and conditions required by this Subscription
Agreement to be performed, satisfied or complied with by it at or prior to the Closing;

 

     

     

    

 

2.3.3            no
governmental authority of competent jurisdiction with respect to the sale of the Acquired Shares shall have issued, enforced or entered
any judgment or order (whether temporary, preliminary or permanent) which is then in effect and has the effect of making consummation
of the Subscription illegal or otherwise preventing or prohibiting consummation of the Subscription;

 

2.3.4            all
conditions precedent to the Issuer’s obligation to effect the Transactions set forth in the Merger Agreement shall have been satisfied
or waived (as determined in good faith by the parties to the Merger Agreement and other than those conditions that (i) may only
be satisfied at the closing of the Transactions, but subject to the satisfaction or waiver of such conditions as of the closing of the
Transactions or (ii) will be satisfied by the Closing);

 

2.3.5            the
Domestication shall have been completed and effective in all respects.

 

2.4            Subscriber’s
obligation to effect the Closing shall be subject to the satisfaction on the Closing Date, or to the extent permitted by applicable law,
the written waiver by Subscriber, of each of the following conditions:

 

2.4.1            no
suspension of the listing or qualification for offering or sale or trading on the Nasdaq Global Market (“Nasdaq”),
of the Common Shares, and to the Issuer’s knowledge, no initiation nor threatening of any proceedings for any of such purposes,
shall have occurred and be continuing, and the Acquired Shares shall have been approved for listing, subject to official notice of issuance,
on Nasdaq;

 

2.4.2            all
representations and warranties of the Issuer contained in this Subscription Agreement shall be true and correct in all material respects
at and as of the Closing Date (except for representations and warranties made as of a specific date, which shall be true and correct in
all material respects as of such date), in each case except where such non-compliance, default or violation has not had and would not
reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect;

 

2.4.3            the
Issuer shall have performed, satisfied and complied in all material respects with all covenants, agreements and conditions required by
this Subscription Agreement to be performed, satisfied or complied with by it at or prior to the Closing, except where the failure of
such performance, satisfaction or compliance would not or would not reasonably be expected to prevent, materially delay or materially
impair the ability of the Issuer to consummate the Closing;

 

2.4.4            no
governmental authority of competent jurisdiction with respect to the sale of the Acquired Shares shall have issued, enforced or entered
any judgment or order (whether temporary, preliminary or permanent) which is then in effect and has the effect of making consummation
of the Subscription illegal or otherwise preventing or prohibiting consummation of the Subscription;

 

2.4.5            without
limiting Section 2.4.6, all conditions precedent to the closing of the Transactions as set forth in the Merger Agreement shall
have been satisfied or waived (as determined in good faith by the parties to the Merger Agreement and other than those conditions that
(i) may only be satisfied at the closing of the Transactions, but subject to the satisfaction or waiver of such conditions as of
the closing of the Transactions or (ii) will be satisfied by the Closing); and

 

2.4.6            except
to the extent consented to in writing by Subscriber, the Merger Agreement (as filed with the Securities and Exchange Commission (the “Commission”)
on or shortly after the date hereof) shall not have been amended, modified, supplemented or waived in a manner that would reasonably be
expected to materially and adversely affect the economic benefits that Subscriber (in its capacity as such) would reasonably expect to
receive under this Subscription Agreement.

 

     

     

    

 

2.5            Prior
to or at the Closing, the parties hereto shall execute and deliver such additional documents and take such additional actions as the
parties reasonably may deem to be practical and necessary in order to consummate the Subscription as contemplated by this Subscription
Agreement.

 

2.6            In
the event that the closing of the Transactions does not occur within three business days of the Scheduled Closing Date specified in the
Closing Notice, unless otherwise agreed by the Issuer and Subscriber, the Issuer shall instruct the Escrow Agent to promptly (but not
later than five (5) business days after the Scheduled Closing Date specified in the Closing Notice) return the funds delivered by
Subscriber for payment of the Acquired Shares by wire transfer in immediately available funds to the account specified in writing by Subscriber,
and any book entries representing the Acquired Shares shall be deemed cancelled. Notwithstanding such cancellation, failure to close on
the Closing Date specified in the Closing Notice shall not, by itself, be deemed to be a failure of any of the conditions to Closing set
forth in this Section 2 to be satisfied or waived, unless and until this Subscription Agreement is terminated in accordance
with Section 7 herein, Subscriber shall remain obligated (i) to redeliver funds to the Issuer following the Issuer’s
delivery to Subscriber of a new Closing Notice with a new Closing Date in accordance with the terms and conditions of this Section 2
and (ii) upon satisfaction or waiver of the conditions set forth in this Section 2 to consummate the Closing immediately
prior to or substantially concurrently with the consummation of the Transactions. For the avoidance of doubt, if any termination hereof
occurs after the delivery by Subscriber of the Purchase Price for the Acquired Shares, the Issuer shall promptly (and no later than three
business days after such termination) return the Purchase Price to Subscriber by wire transfer of U.S. dollars in immediately available
funds to the account specified by Subscriber without any deduction for or on account of any tax, withholding, charges or set-off.

 

3.            Issuer
Representations, Warranties and Covenants. The Issuer represents and warrants as of the date hereof and covenant on the Closing Date,
that:

 

3.1            As
of the date hereof, the Issuer is an exempted company duly incorporated, validly existing and in good standing under the laws of the Cayman
Islands. As of the Closing Date, following the Domestication, the Issuer will be duly incorporated, validly existing as a corporation
and in good standing under the laws of the State of Delaware. The Issuer has, and will have following the Domestication, the requisite
power and authority to own, lease and operate its properties and conduct its business as presently conducted and as shall be conducted
following the Domestication and to enter into, deliver and perform its obligations under this Subscription Agreement.

 

3.2            As
of the Closing Date, the Acquired Shares will have been duly authorized and, when issued and delivered to Subscriber against full payment
for the Acquired Shares in accordance with the terms of this Subscription Agreement, the Acquired Shares will be validly issued, fully
paid and non-assessable, free and clear of any liens or other restrictions whatsoever (other than those arising under state or federal
securities laws and the lock-up restrictions set forth herein) and will not have been issued in violation of or subject to any preemptive
or similar rights created under the Issuer’s certificate of incorporation and bylaws (as in effect at such time of issuance) or
under the laws of the State of Delaware.

 

3.3            This
Subscription Agreement and the Merger Agreement (collectively, the “Transaction Documents”) have been duly authorized,
executed and delivered by the Issuer and, assuming that the Transaction Documents have been duly authorized, executed and delivered by
the other parties thereto, constitute the valid and legally binding obligation of the Issuer, enforceable against the Issuer in accordance
with their respective terms, except as may be limited or otherwise affected by (i) bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium or other laws relating to or affecting the rights of creditors generally and (ii) principles of equity,
whether considered at law or equity.

 

     

     

    

 

3.4            Assuming
the accuracy of Subscriber’s representations and warranties in Section 4, the execution and delivery by the Issuer
of the Transaction Documents, and the performance by the Issuer of their obligations under the Transaction Documents, including the issuance
and sale of the Acquired Shares and the consummation of the other transactions contemplated herein and therein, do not and will not conflict
with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, or result in the creation
or imposition of any lien, charge or encumbrance upon any of the property or assets of the Issuer pursuant to the terms of (i) any
indenture, mortgage, deed of trust, loan agreement, lease, license or other agreement or instrument to which the Issuer is a party or
by which the Issuer is bound or to which any of the property or assets of the Issuer is subject, which would reasonably be expected to
have, individually or in the aggregate, a material adverse effect on the business, properties, financial condition, shareholders’
equity or results of operations of the Issuer (a “Material Adverse Effect”) or materially affect the validity of the
Acquired Shares or the legal authority of the Issuer to comply in all material respects with the terms of this Subscription Agreement;
(ii) the organizational documents of the Issuer; or (iii) any statute or any judgment, order, rule or regulation of
any court or governmental agency or body, domestic or foreign, having jurisdiction over the Issuer or any of its properties that would
reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect or materially affect the validity of the
Acquired Shares or the legal authority of the Issuer to comply in all material respects with the terms of this Subscription Agreement.

 

3.5            There
are no securities or instruments issued by or to which the Issuer is a party containing anti-dilution or similar provisions that will
be triggered by the issuance of the Acquired Shares that have not been or will not be validly waived on or prior to the Closing Date.

 

3.6            Assuming
the accuracy of Subscriber’s representations and warranties in Section 4, the execution, delivery and performance of
this Subscription Agreement and the consummation by the Issuer of the transactions that are the subject of this Subscription Agreement
(including the issuance and sale of the Acquired Shares) will not result in a default or violation (including any event which, with notice
or the lapse of time or both, would constitute a default or violation) of any term, condition or provision of (i) the organizational
documents of the Issuer, (ii) any loan or credit agreement, guarantee, note, bond, mortgage, indenture, lease or other agreement,
permit, franchise or license to which the Issuer is now a party or by which the Issuer’s properties or assets are bound, or (iii) any
statute or any judgment, order, rule or regulation of any court or governmental agency or body, domestic or foreign, having jurisdiction
over the Issuer or any of its properties, except, in the case of clauses (ii) and (iii), for defaults or violations that have not
had and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.

 

3.7            Assuming
the accuracy of Subscriber’s representations and warranties in Section 4, the Issuer is not required to obtain any consent,
waiver, authorization or order of, give any notice to, or make any filing or registration with, any court or other federal, state, local
or other governmental authority, self-regulatory organization, or other person in connection with the execution, delivery and performance
by the Issuer of this Subscription Agreement (including, without limitation, the issuance of the Acquired Shares), other than: (i) the
filing with the Commission of the Registration Statement (as defined below); (ii) the filings required by applicable state or federal
securities laws; (iii) the filings required in accordance with Section 8.13, (iv) those required by Nasdaq, including
with respect to obtaining shareholder approval; (v) any filing, the failure of which to obtain would not reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect or have a material adverse effect of the Issuer’s ability to consummate
the transactions contemplated hereby, including the sale and issuance of the Acquired Shares; and (vi) as set forth in the Merger
Agreement.

 

     

     

    

 

3.8            As
of the date hereof, the authorized share capital of the Issuer consists of (i) 1,000,000 preference shares, par value $0.0001 per
share (the “SPAC Preference Shares”), (ii) 200,000,000 Class A ordinary shares, par value $0.0001 per share
(the “SPAC Class A Shares”) and (iii) 20,000,000 Class B ordinary shares, par value $0.0001 per share
(the “SPAC Class B Shares”). As of the date hereof and as of immediately prior to the Domestication (A) no
SPAC Preference Shares are or will be issued and outstanding, (B) 24,060,000 SPAC Class A Shares are and will be issued and
outstanding, (C) 8,050,000 SPAC Class B Shares are and will be issued and outstanding, and (D) 10,000,000 warrants (the
 “SPAC Warrants”), each evidencing the right to purchase one SPAC Class A Share at an exercise price of $11.50
per SPAC Class A Share, are and will be outstanding. All (i) issued and outstanding SPAC Class A Shares and SPAC Class B
Shares have been duly authorized and validly issued, are fully paid and are non-assessable and are not subject to preemptive rights and
(ii) outstanding warrants have been duly authorized and validly issued, are fully paid and are not subject to preemptive rights.
Except as set forth above and pursuant to the Merger Agreement, there are no outstanding options, warrants or other rights to subscribe
for, purchase or acquire from SPAC any SPAC Class A Shares, SPAC Class B Shares, or other equity interests in SPAC, or securities
convertible into or exchangeable or exercisable for such equity interests. As of the date hereof, SPAC has no direct subsidiaries (other
than the Issuer) and does not own, directly or indirectly, interests or investments (whether equity or debt) in any person, whether incorporated
or unincorporated. There are no shareholder agreements, voting trusts or other agreements or understandings to which SPAC is a party or
by which it is bound relating to the voting of any securities of SPAC, other than (A) as set forth in the SEC Documents (as defined
below) and (B) as contemplated by the Merger Agreement.

 

3.9            Immediately following the
Domestication, the authorized share capital of the Issuer will consist of (i) 1,000,000 shares of preferred stock, par value $0.0001
per share (the “Preferred Stock”) and (ii) 220,000,000 Common Shares. As of immediately following the Domestication:
(A) no shares of Preferred Stock will be issued and outstanding, (B) Common Shares will be issued and outstanding, and (C) 0
warrants, each evidencing the right to purchase one Common Share at an exercise price of $11.50 per Common Share, will be outstanding.
All (i) issued and outstanding Common Shares will have been duly authorized and validly issued, fully paid and are non-assessable
and are not subject to preemptive rights, and (ii) outstanding warrants will have been duly authorized and validly issued, fully
paid and will not be subject to preemptive rights. Except as set forth above and pursuant to the Merger Agreement, there will be no outstanding
options, warrants or other rights to subscribe for, purchase or acquire from the Issuer any Common Shares or other equity interests in
the Issuer, or securities convertible into or exchangeable or exercisable for such equity interests. As of immediately prior to the Domestication,
the Issuer will have no direct subsidiaries (other than Merger Sub) and will not own, directly or indirectly, interests or investments
(whether equity or debt) in any person, whether incorporated or unincorporated. There will be no shareholder agreements, voting trusts
or other agreements or understandings to which the Issuer is a party or by which it is bound relating to the voting of any securities
of the Issuer, other than (A) as set forth in the SEC Documents (as defined below) and (B) as contemplated by the Merger
Agreement.

 

3.10          The
Issuer is in compliance with all applicable laws, except where such non-compliance would not reasonably be expected to have a Material
Adverse Effect. The Issuer has not received any written communication from a governmental entity that alleges that the Issuer is not in
compliance with or are in default or violation of any applicable law, except where such non- compliance, default or violation would not,
individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

 

3.11          The
issued and outstanding SPAC Class A Shares are (and following the Domestication, the Common Shares will be) registered pursuant to
Section 12(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and are listed for
trading on Nasdaq. There is no suit, action, proceeding or investigation pending or, to the knowledge of the Issuer, threatened against
the Issuer by Nasdaq or the Commission with respect to any intention by such entity to deregister the SPAC Class A Shares or prohibit
or terminate the listing of the SPAC Class A Shares or Common Shares on Nasdaq. Except in the connection with the Transactions, the
Issuer has taken no action that is designed to terminate the registration of the SPAC Class A Shares under the Exchange Act or the
listing of the SPAC Class A Shares on Nasdaq.

 

     

     

    

 

3.12          Assuming the accuracy of
Subscriber’s representations and warranties set forth in Section 4, no registration under the Securities Act of 1933,
as amended (the “Securities Act”) is required for the offer and sale of the Acquired Shares by the Issuer to Subscriber
in the manner contemplated by this Subscription Agreement, and the Acquired Shares are not being offered in a manner involving a public
offering under, or in a distribution in violation of, the Securities Act or any state securities laws.

 

3.13          Neither
the Issuer nor any person acting on its behalf has engaged or will engage in any form of general solicitation or general advertising (within
the meaning of Regulation D of the Securities Act) in connection with any offer or sale of the Acquired Shares.

 

3.14          The
Issuer has made available to Subscriber (including via the Commission’s EDGAR system) a copy of each form, report, statement, schedule,
prospectus, proxy, registration statement and other document, if any, filed by the Issuer with the Commission since its initial registration
of the SPAC Class A Shares (the “SEC Documents”), which SEC Documents, as of their respective filing dates, complied
in all material respects with the requirements of the Exchange Act and Securities Act applicable to the SEC Documents and the rules and
regulations of the Commission promulgated thereunder applicable to the SEC Documents. None of the SEC Documents filed under the Exchange
Act (except to the extent that information contained in any SEC Document has been superseded by a later timely filed SEC Document) contained,
when filed, any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to
make the statements therein not misleading, in the case of any SEC Document that is a registration statement, or included, when filed,
any untrue statement of a material fact or omitted to state a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading, in the case of all other SEC Documents; provided, that,
with respect to the Transactions or any other information relating to the Transactions or to Target or any of its affiliates that is included
the proxy statement/prospectus to be filed by the Issuer in connection with the Transactions, any SEC Document or exhibit thereto filed
by the Issuer, the representation and warranty in this sentence is made to the Issuer’s knowledge. SPAC has timely filed each SEC
Document that the Issuer was required to file with the Commission since its inception. There are no material outstanding or unresolved
comments in comment letters from the staff of the Commission with respect to any of the SEC Documents.

 

3.15          Except
for such matters as have not had and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect,
there is no (i) action, suit, claim or other proceeding pending, or, to the knowledge of the Issuer, threatened against the Issuer
or (ii) judgment, decree, injunction, ruling or order of any governmental entity or arbitrator outstanding against the Issuer.

 

3.16          No
broker or finder is entitled to any brokerage or finder’s fee or commission solely in connection with the sale of the Acquired Shares
to Subscriber.

 

3.17          The
Issuer is not, and immediately after receipt of payment for the Acquired Shares will not be, an “investment company” within
the meaning of the Investment Company Act of 1940, as amended.

 

3.18          None
of the Issuer, its subsidiaries or any of its affiliates, nor any person acting on their behalf has, directly or indirectly, made any
offers or sales of any security or solicited any offers to buy any security, under circumstances that would require registration of the
issuance of any of the Acquired Shares under the Securities Act, whether through integration with prior offerings pursuant to Rule 502(a) of
the Securities Act or otherwise.

 

     

     

    

 

3.19          The
Issuer will not directly or indirectly use the proceeds of the sale of the Acquired Shares, or lend, contribute or otherwise make available
such proceeds to a subsidiary, joint venture partner or other person or entity, (i) to fund a person or entity named on the List
of Specially Designated Nationals and Blocked Persons, the Executive Order 13599 List, the Foreign Sanctions Evaders List, or the Sectoral
Sanctions Identification List, each of which is administered by the U.S. Treasury Department’s Office of Foreign Assets Control
(“OFAC”) (collectively “OFAC Lists”), (ii) owned or controlled by, or acting on behalf of,
a person, that is named on an OFAC List, (iii) organized, incorporated, established, located, resident or born in, or a citizen,
national, or the government, including any political subdivision, agency, or instrumentality thereof, of, Cuba, Iran, North Korea,
Syria, the Crimea region of Ukraine, or any other country or territory embargoed or subject to substantial trade restrictions by the
United States, (iv) that is a Designated National (as defined in the Cuban Assets Control Regulations, 31 C.F.R. Part 515)
or (v) that is a non-U.S. shell bank or providing banking services indirectly to a non-U.S. shell bank.

 

4.            Subscriber
Representations and Warranties. Subscriber represents and warrants as of the date hereof and covenants that on the Closing Date, that:

 

4.1            Subscriber
has been duly formed or incorporated and is validly existing in good standing (to the extent the concept of good standing is applicable
in such jurisdiction) under the laws of its jurisdiction of incorporation or formation, with the requisite entity power and authority
to enter into, deliver and perform its obligations under this Subscription Agreement.

 

4.2            This
Subscription Agreement has been duly authorized, executed and delivered by Subscriber. Assuming the due authorization, execution and delivery
of the same by the Issuer, this Subscription Agreement constitutes the valid and legally binding obligation of Subscriber, enforceable
against Subscriber in accordance with its terms, except as such enforceability may be limited or otherwise affected by (i) bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium or other laws relating to or affecting the rights of creditors generally
and (ii) principles of equity, whether considered at law or equity.

 

4.3            The
execution and delivery by Subscriber of this Subscription Agreement, and the performance by Subscriber of its obligations under this Subscription
Agreement, including the purchase of the Acquired Shares and the consummation of the other transactions contemplated herein, will not
conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, or result in the
creation or imposition of any lien, charge or encumbrance upon any of the property or assets of Subscriber pursuant to the terms of (i) any
indenture, mortgage, deed of trust, loan agreement, lease, license or other agreement or instrument to which Subscriber is a party or
by which Subscriber is bound or to which any of the property or assets of Subscriber is subject, which would reasonably be expected to
have a material adverse effect on the business, properties, financial condition, shareholders’ equity or results of operations of
Subscriber, taken as a whole (a “Subscriber Material Adverse Effect”), or materially affect the legal authority of
Subscriber to comply in all material respects with the terms of this Subscription Agreement; (ii) the organizational documents of
Subscriber; or (iii) any statute or any judgment, order, rule or regulation of any court or governmental agency or body, domestic
or foreign, having jurisdiction over Subscriber or any of Subscriber’s properties that would reasonably be expected to have a Subscriber
Material Adverse Effect or materially affect the legal authority of Subscriber to comply in all material respects with this Subscription
Agreement.

 

     

     

    

 

4.4            Subscriber
(i) is a “qualified institutional buyer” (as defined in Rule 144A under the Securities Act) or an “accredited
investor” (within the meaning of Rule 501) under the Securities Act), in each case, satisfying the applicable requirements
set forth on Schedule A, (ii) is acquiring the Acquired Shares only for its own account and not for the account of others,
or if Subscriber is subscribing for the Acquired Shares as a fiduciary or agent for one or more investor accounts, each owner of such
account is a “qualified institutional buyer” or an “accredited investor” (each as defined above) and Subscriber
has full investment discretion with respect to each such account, and the full power and authority to make the acknowledgements, representations
and agreements herein on behalf of each owner of each such account and (iii) is not acquiring the Acquired Shares with a view to,
or for offer or sale in connection with, any distribution thereof in violation of the Securities Act. Subscriber has completed Schedule
A following the signature page hereto and the information contained therein is accurate and complete in all material respects.
Subscriber is not an entity formed for the specific purpose of acquiring the Acquired Shares, unless Subscriber is a newly formed entity
in which all of the equity owners are accredited investors, and is an “institutional account” as defined by FINRA Rule 4512(c).
Accordingly, Subscriber is aware that this offering of the Acquired Shares meets the exemptions from filing under FINRA Rule 5123(b)(1)(A),
(C) or (J).

 

4.5            Subscriber understands that
the Acquired Shares are being offered in a transaction not involving any public offering within the meaning of the Securities Act and
that the Acquired Shares have not been registered under the Securities Act. Subscriber understands that the Acquired Shares may not be
offered, resold, transferred, pledged or otherwise disposed of by Subscriber absent an effective registration statement under the Securities
Act, except: (i) to the Issuer or a subsidiary thereof; (ii) to non-U.S. persons pursuant to offers and sales that occur
outside the United States within the meaning of Regulation S under the Securities Act; (iii) pursuant to Rule 144 promulgated
under the Securities Act (“Rule 144”), provided that all of the applicable conditions thereof have been
met; or (iv) pursuant to another applicable exemption from the registration requirements of the Securities Act, including pursuant
to a private sale effected under Section 4(a)(7) of the Securities Act or applicable formal or informal Commission interpretation
or guidance, such as a so-called “4(a)(1) and a half” sale, and that any book-entry records representing the Acquired
Shares shall contain a legend to such effect. Subscriber acknowledges that the Acquired Shares will not be eligible for resale pursuant
to Rule 144A under the Securities Act. Subscriber understands and agrees that the Acquired Shares will be subject to the foregoing
transfer restrictions and, as a result of these transfer restrictions, Subscriber may not be able to readily resell the Acquired Shares
and may be required to bear the financial risk of an investment in the Acquired Shares for an indefinite period of time. Subscriber acknowledges
and agrees that the Acquired Shares will not be eligible for offer, resale, transfer, pledge or disposition pursuant to Rule 144
until at least one year from the filing of certain required information with the Commission after the Closing Date. Subscriber understands
that it has been advised to consult legal counsel prior to making any offer, resale, pledge or transfer of any of the Acquired Shares.

 

4.6            Subscriber
understands and agrees that Subscriber is purchasing the Acquired Shares directly from the Issuer. Subscriber further acknowledges that
there have been no representations, warranties, covenants and agreements made to Subscriber by the Issuer or any of its control persons,
officers, directors, employees, partners, agents or representatives, any other party to the Transactions or any other person or entity,
expressly or by implication, other than those representations, warranties, covenants and agreements included in this Subscription Agreement.
Subscriber acknowledges that certain information provided by the Issuer was based on projections, and such projections were prepared based
on assumptions and estimates that are inherently uncertain and are subject to a wide variety of significant business, economic and competitive
risks and uncertainties that could cause actual results to differ materially from those contained in the projections.

 

     

     

    

 

4.7            Subscriber’s
acquisition and holding of the Acquired Shares will not constitute or result in a non-exempt prohibited transaction under section 406
of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), section 4975 of the Internal Revenue
Code of 1986, as amended (the “Code”), or any applicable similar law.

 

4.8            In
making its decision to subscribe for and purchase the Acquired Shares, Subscriber represents that it has relied solely upon its own independent
investigation and the Issuer’s representations and warranties in Section 3. Subscriber acknowledges and agrees that
Subscriber has received and has had the opportunity to review such information as Subscriber deems necessary in order to make an investment
decision with respect to the Acquired Shares, including with respect to the Issuer, Target, and the Transactions. Subscriber represents
and agrees that Subscriber and Subscriber’s professional advisor(s), if any, have (i) had the full opportunity to ask such
questions, receive such answers and obtain such information as Subscriber and such Subscriber’s professional advisor(s), if any,
have deemed necessary to make an investment decision with respect to the Acquired Shares, (ii) conducted and completed its own
independent due diligence with respect to the Transactions, and (iii) has reviewed the SEC Documents and the Merger Agreement.
Except for the representations, warranties and agreements of the Issuer expressly set forth in this Subscription Agreement, Subscriber
is relying exclusively on its own sources of information, investment analysis and due diligence (including professional advice it deems
appropriate) with respect to the Transactions, the Acquired Shares and the business, condition (financial and otherwise), management,
operations, properties and prospects of the Issuer including, but not limited to, all business, legal, regulatory, accounting, credit
and tax matters.

 

4.9            Subscriber
became aware of this offering of the Acquired Shares solely by means of direct contact between Subscriber and the Issuer Target or a representative
of the Issuer and the Acquired Shares were offered to Subscriber solely by direct contact between Subscriber and the Issuer or Target
or a representative of the Issuer. Subscriber did not become aware of this offering of the Acquired Shares, nor were the Acquired Shares
offered to Subscriber, by any other means. Subscriber acknowledges that the Issuer represents and warrants that the Acquired Shares (i) were
not offered by any form of general solicitation or general advertising and (ii) are not being offered in a manner involving a public
offering under, or in a distribution in violation of, the Securities Act, or any state securities laws.

 

4.10          Subscriber
acknowledges that it is aware that there are substantial risks incident to the purchase and ownership of the Acquired Shares, including
those set forth in the SEC Documents. Subscriber has such knowledge and experience in financial and business matters as to be capable
of evaluating the merits and risks of an investment in the Acquired Shares, and Subscriber has sought such accounting, legal and tax advice
as Subscriber has considered necessary to make an informed investment decision. Accordingly, Subscriber acknowledges that the offering
of the Acquired Shares meets the institutional account exemptions from filing under FINRA Rule 2111(b).

 

4.11          Subscriber
acknowledges and agrees that neither the Issuer nor any of its respective affiliates (nor any officer, director, employee or representative
of any of the Issuer or its respective affiliates) has provided Subscriber with any information or advice with respect to the Acquired
Shares, nor is such information or advice necessary or desired. Subscriber acknowledges that neither the Issuer, its affiliates, nor any
of its officers, directors, employees, representatives or controlling persons have (i) made any representation as to the Issuer or
the quality of the Acquired Shares, and the Placement Agent may have acquired non-public information with respect to the Issuer which
Subscriber agrees, subject to applicable law, need not be provided to it; (ii) made an independent investigation with respect to
the Issuer or the Acquired Shares or the accuracy, completeness or adequacy of any information supplied to Subscriber by the Issuer; (iii) acted
as Subscriber’s financial advisor or fiduciary in connection with the issuance and purchase of the Acquired Shares; or (iv) prepared
a disclosure or offering document in connection with the offer and sale of the Acquired Shares.

 

     

     

    

 

4.12          Subscriber
acknowledges and agrees that neither the Issuer, any affiliate of the Issuer, nor any of its officers, directors, employees, representatives
or controlling persons will have any liability to Subscriber in connection with Subscriber’s purchase of the Acquired Shares. Without
limitation of the foregoing, Subscriber hereby further acknowledges and agrees that the Issuer will have no responsibility with respect
to (A) any representations, warranties or agreements made by any person or entity under or in connection with the transactions contemplated
hereby or any of the documents furnished pursuant thereto or in connection therewith, or the execution, legality, validity or enforceability
(with respect to any person) of any thereof, or (B) the financial condition, business, or any other matter concerning the Issuer
or the transactions contemplated hereby.

 

4.13          Subscriber represents and
acknowledges that Subscriber, alone or together with any professional advisor(s), has analyzed and considered the risks of an investment
in the Acquired Shares and determined that the Acquired Shares are a suitable investment for Subscriber and that Subscriber is able at
this time and in the foreseeable future to bear the economic risk of a total loss of Subscriber’s investment in the Issuer. Subscriber
acknowledges specifically that a possibility of total loss exists.

 

4.14          Subscriber
understands that no federal or state agency has passed upon or endorsed the merits of the offering of the Acquired Shares or made any
findings or determination as to the fairness of an investment in the Acquired Shares.

 

4.15          Subscriber
is not (i) a person or entity named on the OFAC Lists, (ii) owned or controlled by, or acting on behalf of, a person, that is
named on an OFAC List, (iii) organized, incorporated, established, located, resident or born in, or a citizen, national, or the government,
including any political subdivision, agency, or instrumentality thereof, of, Cuba, Iran, North Korea, Syria, the Crimea region of
Ukraine, or any other country or territory embargoed or subject to substantial trade, economic and financial restrictions by the United
States (including without limitation the U.S. Department of the Treasury, Office of Foreign Assets Control, the U.S. Department of State,
and the U.S. Department of Commerce), the European Union and enforced by its member states, the United Nations and the United Kingdom,
(iv) a Designated National as defined in the Cuban Assets Control Regulations, 31 C.F.R. Part 515, or (v) a non-U.S. shell
bank or providing banking services indirectly to a non-U.S. shell bank. Subscriber represents that if it is a financial institution subject
to the Bank Secrecy Act (31 U.S.C. section 5311 et seq.), as amended by the USA PATRIOT Act of 2001, and its implementing regulations
(collectively, the “BSA/PATRIOT Act”), that Subscriber maintains policies and procedures reasonably designed to comply
with applicable obligations under the BSA/PATRIOT Act. Subscriber also represents that, to the extent required, it maintains policies
and procedures reasonably designed to ensure compliance with OFAC-administered sanctions programs, including for the screening of its
investors against the OFAC Lists. Subscriber further represents and warrants that, to the extent required, it maintains policies and procedures
reasonably designed to ensure that the funds held by Subscriber and used to purchase the Acquired Shares were legally derived and any
returns from Subscriber’s investment will not be used to finance any illegal activities.

 

4.16          Subscriber
is not owned or controlled by or acting on behalf of (in connection with this Transaction), a person or entity resident in, or whose funds
used to purchase the Subscribed Shares are transferred from or through, a country, territory or entity that (i) has been designated
as non-cooperative with international anti-money laundering or counter terrorist financing principles or procedures by the United States
or by an intergovernmental group or organization, such as the Financial Action Task Force, of which the United States is a member; (ii) is
the subject of an advisory issued by the Financial Crimes Enforcement Network of the U.S. Department of the Treasury; or (iii) has
been designated by the Secretary of the Treasury under Section 311 of the USA PATRIOT Act as warranting special measures due to money
laundering concerns (any such country or territory, a “Non-cooperative Jurisdiction”), or an entity or individual that
resides or has a place of business in, or is organized under the laws of, a Non-cooperative Jurisdiction.

 

     

     

    

 

4.17          Subscriber does not have,
as of the date hereof, and during the 30-day period immediately prior to the date hereof such Subscriber has not entered into, any “put
equivalent position” as such term is defined in Rule 16a-1 under the Exchange Act or Short Sale positions with respect to
the securities of the Issuer. Notwithstanding the foregoing, in the case of a Subscriber that is a multi-managed investment vehicle whereby
separate portfolio managers manage separate portions of such Subscriber’s assets and the portfolio managers have no direct knowledge
of the investment decisions made by the portfolio managers managing other portions of such Subscriber’s assets, the representation
set forth above shall only apply with respect to the portion of assets managed by the portfolio manager that made the investment decision
to purchase the Acquired Shares covered by this Agreement.

 

4.18          Subscriber
is not currently (and at all times through the Closing will refrain from being or becoming) a member of a “group” (within
the meaning of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act or any successor provision) acting for the
purpose of acquiring, holding, voting or disposing of equity securities of the Issuer (within the meaning of Rule 13d-5(b)(1) under
the Exchange Act).

 

4.19          If
Subscriber is or is acting on behalf of (i) an employee benefit plan that is subject to Title I of ERISA, (ii) a plan, an individual
retirement account or other arrangement that is subject to section 4975 of the Code, (iii) an entity whose underlying assets are
considered to include “plan assets” of any such plan, account or arrangement described in clauses (i) and (ii) (each,
an “ERISA Plan”), or (iv) an employee benefit plan that is a governmental plan (as defined in section 3(32) of
ERISA), a church plan (as defined in section 3(33) of ERISA), a non-U.S. plan (as described in section 4(b)(4) of ERISA) or other
plan that is not subject to the foregoing clauses (i), (ii) or (iii) but may be subject to provisions under any other federal,
state, local, non-U.S. or other laws or regulations that are similar to such provisions of ERISA or the Code (collectively, “Similar
Laws,” and together with the ERISA Plans, the “Plans”) Subscriber represents and warrants that (i) neither
the Issuer, nor any of its respective affiliates (the “Transaction Parties”) has provided investment advice or has
otherwise acted as a Plan’s fiduciary, with respect to its decision to acquire and hold the Acquired Shares, and none of the Transaction
Parties is or shall at any time be a Plan’s fiduciary with respect to any decision to acquire and hold the Acquired Shares, and
none of the Transaction Parties is or shall at any time be a Plan’s fiduciary with respect to any decision in connection with Subscriber’s
investment in the Acquired Shares; and (ii) its purchase of the Acquired Shares will not result in a non-exempt prohibited transaction
under section 406 of ERISA or section 4975 of the Code, or any applicable Similar Law.

 

4.20          At
the Purchase Price Payment Date, Subscriber will have sufficient funds to pay the Purchase Price pursuant to Section 2.2.1.

 

4.21          Subscriber
agrees that no party to the Merger Agreement, including any such party’s representatives, affiliates or any of its or their control
persons, officers, directors or employees, that is not a party hereto, shall be liable to Subscriber pursuant to this Subscription Agreement
for any action heretofore or hereafter taken or omitted to be taken by any of them in connection with the purchase of the Acquired Shares.

 

4.22          Subscriber
understands that the foregoing representations and warranties shall be deemed material to and have been relied upon by the Issuer.

 

     

     

    

 

5.            Registration
Rights.

 

5.1            The Issuer agrees that,
as soon as practicable (but in any case within 60 calendar days after the consummation of the Transactions (the “Filing Date”)),
the Issuer shall file with the Commission (at the Issuer’s sole cost and expense) a registration statement (the “Registration
Statement”), registering the resale of the Acquired Shares (which may be a “shelf” registration statement), which
Registration Statement may include shares of the Issuer’s common stock issuable upon exercise of outstanding warrants or those
held by Innovative International Sponsor I LLC, a Delaware limited liability company (the “Sponsor”), and the Issuer
shall use its commercially reasonable efforts to have the Registration Statement, or another shelf registration statement that includes
Acquired Shares to be declared effective as soon as practicable after the filing thereof. Pubco agrees to cause such Registration Statement,
or another shelf registration statement that includes the Purchased Shares to be sold pursuant to this Subscription Agreement, to remain
effective until the earliest of (i) the second anniversary of the Closing, (ii) the date on which the Investor ceases to
hold any Registrable Securities covered by such Registration Statement, or (iii) on the first date on which the Investor is able
to sell all of its Registrable Securities issued pursuant to this Subscription Agreement (or shares received in exchange therefor) under
Rule 144 promulgated under the Securities Act (“Rule 144”) without limitation as to the manner of sale
or the amount of such securities that may be sold.); provided, however, that the Issuer’s obligations to include
the Acquired Shares in the Registration Statement are contingent upon Subscriber furnishing in writing to the Issuer such information
regarding Subscriber, the securities of the Issuer held by Subscriber, and the intended method of disposition of the Acquired Shares
as shall be reasonably requested by the Issuer to effect the registration of the Acquired Shares (including but not limited to Subscriber’s
beneficial ownership, as determined in accordance with Rule 13d-3 of the Exchange Act), and Subscriber shall execute such documents
in connection with such registration as the Issuer may reasonably request that are customary of a selling stockholder in similar situations,
including providing that the Issuer shall be entitled to postpone and suspend the effectiveness or use of the Registration Statement
during any customary blackout or similar period or as permitted hereunder; provided, that, Subscriber shall not in connection
with the foregoing be required to execute any lock-up or similar agreement or otherwise be subject to any contractual restriction on
the ability to transfer the Acquired Shares (other than any such restrictions that may exist hereunder). Notwithstanding the foregoing,
if the Commission prevents the Issuer from including any or all of the shares proposed to be registered under the Registration Statement
for the resale of the Acquired Shares or other shares included in the Registration Statement by the applicable stockholders or otherwise,
such Registration Statement shall register for resale such number of Acquired Shares which is equal to the maximum number of Acquired
Shares as is permitted by the Commission. In such event, the number of Common Shares to be registered for each selling stockholder named
in the Registration Statement shall be reduced pro rata among all such selling stockholders. Upon notification by the Commission that
the Registration Statement has been declared effective by the Commission, within five business days thereafter, the Issuer shall file
the final prospectus under Rule 424 of the Securities Act. The Issuer will provide a draft of the Registration Statement to Subscriber
for review (but not comment) reasonably in advance of filing the Registration Statement; provided, that, for the avoidance of
doubt, in no event shall the Issuer be required to delay or postpone the filing of such Registration Statement as a result of or in connection
with Subscriber’s review. In no event shall Subscriber be identified as a statutory underwriter in the Registration Statement unless
requested by the Commission; provided, that if the Commission requests that Subscriber be identified as a statutory underwriter
in the Registration Statement, Subscriber will have an opportunity to withdraw from the Registration Statement. Subscriber shall not
be entitled to use the Registration Statement for an underwritten offering of Acquired Shares. For purposes of clarification, any failure
by the Issuer to file the Registration Statement by the Filing Date or to effect such Registration Statement by the Effective Date shall
not otherwise relieve the Issuer of its obligations to file the Registration Statement or effect the registration of the Acquired Shares
set forth in this Section 5. For purposes of this Section 5, “Acquired Shares” shall include
any equity security of the Issuer issued or issuable with respect to the Acquired Shares by way of share split, dividend, distribution,
recapitalization, merger, exchange, replacement or similar event or otherwise.

 

     

     

    

 

5.2            In the case of the registration
effected by the Issuer pursuant to this Subscription Agreement, the Issuer shall, upon reasonable request, inform Subscriber as to the
status of such registration. At its expense the Issuer shall:

 

5.2.1            except
for such times as the Issuer is permitted hereunder to suspend the use of the prospectus forming part of a Registration Statement, use
its commercially reasonable efforts to keep such registration, and any qualification, exemption or compliance under state securities laws
that the Issuer determines to obtain, continuously effective with respect to Subscriber, and to keep the applicable Registration Statement
or any subsequent shelf registration statement free of any material misstatements or omissions, until the earliest of the following to
occur: (i) Subscriber ceases to hold any Acquired Shares, (ii) the date all Acquired Shares held by Subscriber may be sold under
Rule 144 within 90 calendar days, without limitation as to any public information, volume and manner of sale restrictions and without
the requirement for the Issuer to be in compliance with the current public information required under Rule 144(c)(1) or Rule 144(i)(2),
and (iii) the date that is two years from the Effective Date of the Registration Statement.

 

5.2.2            advise
Subscriber within three business days:

 

(a)            when
a Registration Statement or any amendment thereto has been filed with the Commission and when becomes effective;

 

(b)            of
any request by the Commission for amendments or supplements to any Registration Statement or the prospectus included therein or for additional
information;

 

(c)            of
the issuance by the Commission of any stop order suspending the effectiveness of any Registration Statement or the initiation of any proceedings
for such purpose;

 

(d)            of
the receipt by the Issuer of any notification with respect to the suspension of the qualification of the Acquired Shares included therein
for sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose; and

 

(e)             in
accordance with Section 5.3 of this Subscription Agreement, of the occurrence of any event that requires the making of any
changes in any Registration Statement or prospectus so that, as of such date, any Registration Statement does not contain an untrue statement
of a material fact or does not omit to state a material fact required to be stated therein or necessary to make the statements therein
not misleading, or any prospectus does not include an untrue statement of a material fact or does not omit to state a material fact necessary
in order to make the statements therein, in the light of the circumstances under which they were made, not misleading.

 

Notwithstanding anything to
the contrary set forth herein, the Issuer shall not, when so advising Subscriber of such events, provide Subscriber with any material,
nonpublic information regarding the Issuer other than to the extent that providing notice to Subscriber of the occurrence of the events
listed in Section 5.2.2(a) through Section 5.2.2(e) above constitutes material, nonpublic information
regarding the Issuer;

 

5.2.3            use
its commercially reasonable efforts to obtain the withdrawal of any order suspending the effectiveness of any Registration Statement as
soon as reasonably practicable;

 

     

     

    

 

5.2.4            upon
the occurrence of any event contemplated in Section 5.2.2(e), except for such times as the Issuer is permitted hereunder to
suspend, and has suspended, the use of a prospectus forming part of a Registration Statement, the Issuer shall use its commercially reasonable
efforts to as soon as reasonably practicable prepare a post-effective amendment to such Registration Statement or a supplement to the
related prospectus, or file any other required document so that, as thereafter delivered to purchasers of the Acquired Shares included
therein, such prospectus will not include any untrue statement of a material fact or omit to state any material fact necessary in order
to make the statements therein, in the light of the circumstances under which they were made, not misleading;

 

5.2.5           use its commercially reasonable
efforts to cause all Acquired Shares to be listed on each securities exchange or market, if any, on which the SPAC Class A Shares
issued by the Issuer have been listed;

 

5.2.6            use
its commercially reasonable efforts to take all other steps necessary to effect the registration of the Acquired Shares contemplated hereby
and, for so long as Subscriber holds Acquired Shares, to enable Subscriber to sell the Acquired Shares under Rule 144; and

 

5.2.7            subject
to receipt from Subscriber by the Issuer and its transfer agent of customary representations and other documentation reasonably acceptable
to the Issuer and the transfer agent in connection therewith, including, if required by the transfer agent, an opinion of the Issuer’s
counsel, in a form reasonably acceptable to the transfer agent, to the effect that the removal of such restrictive legends in such circumstances
may be effected under the Securities Act, upon Subscriber’s request, the Issuer will reasonably cooperate with the Issuer’s
transfer agent, such that any remaining restrictive legend set forth on such Acquired Shares will be removed from the book entry position
evidencing its Acquired Shares following the earliest of such time as such Acquired Shares hereunder are either eligible to be sold (i) pursuant
to an effective registration statement or (ii) without restriction under, and without the requirement for the Issuer to be in compliance
with the current public information requirements of, Rule 144 under the Securities Act. The Issuer shall be responsible for the fees
of its transfer agent, its legal counsel and all Depository Trust Company fees associated with such issuance.

 

5.3            Notwithstanding
anything to the contrary in this Subscription Agreement, the Issuer shall be entitled to delay or postpone the filing or effectiveness
of the Registration Statement, and from time to time to require Subscriber not to sell under the Registration Statement or to suspend
the effectiveness or use thereof, if it determines, upon the advice of outside legal counsel, that the negotiation or consummation of
a transaction by the Issuer or its subsidiaries is pending or an event has occurred, which negotiation, consummation or event, the Issuer
reasonably believes would require additional disclosure by the Issuer in the Registration Statement of material information that the Issuer
has a bona fide business purpose for keeping confidential and the non-disclosure of which in the Registration Statement would be expected,
in the reasonable determination of the Issuer, upon advice of legal counsel, to cause the Registration Statement to fail to comply with
applicable disclosure requirements (each such circumstance, a “Suspension Event”). Upon receipt of any written notice
from the Issuer of the happening of any Suspension Event during the period that the Registration Statement is effective or if as a result
of a Suspension Event the Registration Statement contains any untrue statement of a material fact or omits to state any material fact
required to be stated therein or necessary to make the statements therein not misleading, or any related prospectus includes any untrue
statement of a material fact or omits to state any material fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading, Subscriber agrees that (i) it will immediately discontinue offers and sales
of the Acquired Shares under the Registration Statement until Subscriber receives copies of a supplemental or amended prospectus (which
the Issuer agrees to promptly prepare) that corrects the misstatement(s) or omission(s) referred to above and receives notice
that any post-effective amendment has become effective or unless otherwise notified by the Issuer that it may resume such offers and sales
and (ii) it will maintain the confidentiality of any information included in such written notice delivered by the Issuer unless otherwise
required by law or subpoena. Notwithstanding anything to the contrary, the Issuer shall use its commercially reasonable efforts to cause
its transfer agent to deliver unlegended shares to a transferee of Subscriber in connection with any sale of Acquired Shares with respect
to which Subscriber has entered into a contract for sale, prior to Subscriber’s receipt of the notice of a Suspension Event and
which has not yet settled. If so directed by the Issuer, Subscriber will deliver to the Issuer or, in Subscriber’s sole discretion
destroy, all copies of the prospectus covering the Acquired Shares in Subscriber’s possession; provided, however,
that this obligation to deliver or destroy all copies of the prospectus covering the Acquired Shares shall not apply (A) to the extent
Subscriber is required to retain a copy of such prospectus (x) in order to comply with applicable legal, regulatory, self-regulatory
or professional requirements or (y) in accordance with a bona fide pre-existing document retention policy or (B) to copies stored
electronically on archival servers as a result of automatic data back-up. In addition, Subscriber agrees that any sales under the Registration
Statement will be suspended from the time that the Issuer files its first annual report on Form 10-K with the Commission after the
Effective Date until such time as the Commission declares any applicable post-effective amendment to the Registration Statement effective.
The Issuer shall use its commercially reasonable efforts to limit such period of suspension and shall notify Subscriber when sales can
recommence under the Registration Statement within two business days of the Effective Date. For the avoidance of doubt, such suspension
shall not constitute a Suspension Event or be subject to any of the provisions relating thereto in this Section 5.3 (other
than with respect to notification of the occurrence of such suspension).

 

     

     

    

 

5.4            Subscriber
may deliver written notice (an “Opt-Out Notice”) to the Issuer requesting that Subscriber not receive notices from
the Issuer otherwise required by this Section 5; provided, however, that Subscriber may later revoke any such
Opt-Out Notice in writing. Following receipt of an Opt-Out Notice from Subscriber (unless subsequently revoked), (i) the Issuer
shall not deliver any such notices to Subscriber and Subscriber shall no longer be entitled to the rights associated with any such notice
and (ii) each time prior to Subscriber’s intended use of an effective Registration Statement, Subscriber will notify the
Issuer in writing at least two business days in advance of such intended use, and if a notice of a Suspension Event was previously delivered
(or would have been delivered but for the provisions of this Section 5.4) and the related suspension period remains in effect,
the Issuer will so notify Subscriber, within one business day of Subscriber’s notification to the Issuer, by delivering to Subscriber
a copy of such previous notice of Suspension Event, and thereafter will provide Subscriber with the related notice of the conclusion
of such Suspension Event or other event immediately upon its availability.

 

5.5            The
Issuer shall, indemnify, defend and hold harmless Subscriber (to the extent a seller under the Registration Statement), its directors,
officers, agents, trustees, affiliates, advisers and employees and each person who controls Subscriber (within the meaning of Section 15
of the Securities Act or Section 20 of the Exchange Act) to the fullest extent permitted by applicable law, from and against any
and all out-of-pocket losses, claims, damages, liabilities, costs (including reasonable attorneys’ fees) and expenses (collectively,
 “Losses”), as incurred, that arise out of or are based upon (i) any untrue or alleged untrue statement of a material
fact contained in the Registration Statement or in any amendment or supplement thereto, or arising out of or relating to any omission
or alleged omission to state a material fact required to be stated therein or necessary to make the statements therein not misleading
or (ii) any untrue or alleged untrue statement of a material fact included in any prospectus included in the Registration Statement,
or any form of prospectus, or in any amendment or supplement thereto or in any preliminary prospectus, or arising out of or relating to
any omission or alleged omission to state a material fact necessary in order to make the statements therein, in the light of the circumstances
under which they were made, not misleading, or (iii) any violation or alleged violation by the Issuer of the Securities Act, Exchange
Act or any state securities law or any rule or regulation thereunder in connection with the performance of its obligations under
this Section 5, except to the extent, but only to the extent, that such untrue statements, alleged untrue statements, omissions
or alleged omissions are based upon information regarding Subscriber furnished in writing to the Issuer by Subscriber expressly for use
therein or Subscriber has omitted a material fact from such information; provided, however, that the indemnification contained
in this Section 5 shall not apply to amounts paid in settlement of any Losses if such settlement is effected without the consent
of the Issuer (which consent shall not be unreasonably withheld, conditioned or delayed), nor shall the Issuer be liable for any Losses
to the extent they arise out of or are based upon a violation that occurs (A) in reliance upon and in conformity with written information
furnished by Subscriber, (B) in connection with any failure of such person to deliver or cause to be delivered a prospectus made
available by the Issuer in a timely manner or (C) in connection with any offers or sales effected by or on behalf of Subscriber in
violation of Section 5.3 hereof. The Issuer shall notify Subscriber promptly of the institution, threat or assertion of any
proceeding arising from or in connection with the transactions contemplated by this Section 5 of which the Issuer receives
notice in writing.

 

     

     

    

 

5.6            Subscriber
shall indemnify and hold harmless the Issuer, its directors, officers, agents and employees, and each person who controls the Issuer
(within the meaning of Section 15 of the Securities Act and Section 20 of the Exchange Act), to the fullest extent permitted
by applicable law, from and against all Losses, as incurred, that arise out of or are based upon (i) any untrue or alleged untrue
statement of a material fact contained in any Registration Statement or in any amendment or supplement thereto or arising out of or relating
to any omission or alleged omission of a material fact required to be stated therein or necessary to make the statements therein not
misleading or (ii) any untrue or alleged untrue statement of a material fact included in any prospectus included in the Registration
Statement, or any form of prospectus, or in any amendment or supplement thereto or in any preliminary prospectus, or arising out of or
relating to any omission or alleged omission of a material fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading but only to the extent that such untrue or alleged untrue statements or omissions
or alleged omissions are based upon information regarding Subscriber furnished in writing to the Issuer by Subscriber expressly for use
therein or a material fact that Subscriber has omitted from such information; provided, however, that the indemnification contained
in this Section 5.6 shall not apply to amounts paid in settlement of any Losses if such settlement is effected without the
consent of Subscriber (which consent shall not be unreasonably withheld, conditioned or delayed). In no event shall the liability of
Subscriber be greater in amount than the dollar amount of the net proceeds received by Subscriber upon the sale of the Acquired Shares
giving rise to such indemnification obligation. Subscriber shall notify the Issuer promptly of the institution, threat or assertion of
any proceeding arising from or in connection with the transactions contemplated by this Section 5.6 of which Subscriber
is aware.

 

5.7            Any
person or entity entitled to indemnification herein shall (i) give prompt written notice to the indemnifying party of any claim with
respect to which it seeks indemnification (provided that the failure to give prompt notice shall not impair any person’s
or entity’s right to indemnification hereunder to the extent such failure has not prejudiced the indemnifying party) and (ii) unless,
in such indemnified party’s reasonable judgment, a conflict of interest between such indemnified and indemnifying parties may exist
with respect to such claim, permit such indemnifying party to assume the defense of such claim with counsel reasonably satisfactory to
the indemnified party. If such defense is assumed, the indemnifying party shall not be subject to any liability for any settlement made
by the indemnified party without its consent (but such consent shall not be unreasonably withheld, conditioned or delayed). An indemnifying
party who is not entitled to, or elects not to, assume the defense of a claim shall not be obligated to pay the fees and expenses of more
than one counsel for all parties indemnified by such indemnifying party with respect to such claim, unless in the reasonable judgment
of legal counsel to any indemnified party a conflict of interest exists between such indemnified party and any other of such indemnified
parties with respect to such claim. No indemnifying party shall, without the consent of the indemnified party, consent to the entry of
any judgment or enter into any settlement that cannot be settled in all respects by the payment of money (and such money is so paid by
the indemnifying party pursuant to the terms of such settlement) or which settlement includes a statement or admission of fault and culpability
on the part of such indemnified party or which does not include as an unconditional term thereof the giving by the claimant or plaintiff
to such indemnified party of a release from all liability in respect to such claim or litigation.

 

     

     

    

 

5.8            The indemnification provided
for under this Subscription Agreement shall remain in full force and effect regardless of any investigation made by or on behalf of the
indemnified party or any officer, director, employee, agent, affiliate or controlling person or entity of such indemnified party and
shall survive the transfer of the Acquired Shares purchased pursuant to this Subscription Agreement solely with respect to Losses that
occur or arise out of indemnifiable acts or omissions during the time that the Subscriber owns the Acquired Shares.

 

5.9            In
the event Subscriber becomes a party to the Amended and Restated Registration Rights Agreement entered into by certain shareholders of
the Issuer in connection with the Merger Closing (the “Registration Rights Agreement”), this Section 5
shall not apply and not be effective with respect to such Subscriber. For the avoidance of doubt, the Issuer acknowledges and agrees that
Subscriber is not party to the Registration Rights Agreement.

 

6.            Transfer
Restrictions.

 

6.1            The
Subscriber shall not Transfer (as defined below) any Acquired Shares until the earlier of (i) six months after the completion of
the Issuer’s initial business combination or (ii) subsequent to the Issuer’s initial business combination, (x) if
the last sale price of the Common Shares equals or exceeds $12.00 per Common Share (as adjusted for share splits, share capitalizations,
rights issuances, subdivisions, reorganizations, recapitalizations and the like) for any 20 trading days within any 30-trading day period
commencing at least 150 days after the Issuer’s initial Business Combination or (y) the date on which the Issuer completes
a liquidation, merger, share exchange, reorganization or other similar transaction that results in all of the Issuer’s shareholders
having the right to exchange their Common Shares for cash, securities or other property.

 

6.2            Notwithstanding
the provisions set forth in Section 6.1, Transfers of the Acquired Shares that are held by the Subscriber or any of its
permitted transferees (that have complied with this Section 6.2), are permitted (i) to the Issuer’s officers
or directors, any affiliates or family members of any of the Issuer’s officers or directors, any members of the Sponsor, or any
affiliates of the Sponsor; (ii) in the case of an individual, transfers by gift to a member of the individual’s immediate family,
to a trust, the beneficiary of which is a member of the individual’s immediate family or an affiliate of such person, or to a charitable
organization; (iii) in the case of an individual, transfers by virtue of laws of descent and distribution upon death of the individual;
(iv) in the case of an individual, transfers pursuant to a qualified domestic relations order; (v) transfers by private sales
or transfers made in connection with the consummation of a business combination at prices no greater than the price at which the securities
were originally purchased; (vi) transfers in the event of the Issuer’s liquidation prior to the completion of an initial business
combination; and (vii) transfers by virtue of the laws of the State of Delaware or the Sponsor’s limited liability company
agreement upon dissolution of the Sponsor; provided, however, that in the case of clauses (i) through (v) or (vii), these permitted
transferees must enter into a written agreement agreeing to be bound by the restrictions herein. As
used in this Agreement, “Transfer” shall mean the (x) sale of, offer to sell, contract or agreement to sell, hypothecation,
pledge, grant of any option to purchase or otherwise dispose of or agreement to dispose of, directly or indirectly, or establishment or
increase of a put equivalent position or liquidation with respect to or decrease of a call equivalent position (within the meaning of
Section 16 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the rules and regulations
of the SEC promulgated thereunder) with respect to, any of the Securities; (y) entry into any swap or other arrangement that transfers
to another, in whole or in part, any of the economic consequences of ownership of any of the Securities, whether any such transaction
is to be settled by delivery of such Securities, in cash or otherwise, or (z) public announcement of any intention to effect any
transaction specified in clause (x) or (y).

 

     

     

    

 

7.           Termination. This
Subscription Agreement shall terminate and be void and of no further force and effect (except for those provisions expressly contemplated
to survive termination of this Subscription Agreement in accordance with Section 9.4), and all rights and obligations of
the parties hereunder shall terminate without any further liability on the part of any party in respect thereof (except for those provisions
expressly contemplated to survive termination of this Subscription Agreement in accordance with Section 9.4), upon the earliest
to occur of (i) such date and time as the Merger Agreement is terminated in accordance with its terms without being consummated,
(ii) upon the mutual written agreement of each of the parties hereto and Target to terminate this Subscription Agreement, and (iii) if
any of the conditions of Closing set forth in Section 2 are not satisfied on or prior to the earlier of the Closing Date
and the Outside Date (as filed with the Commission on or shortly after the date hereof) and, as a result thereof, the transactions contemplated
by this Subscription Agreement are not consummated at the Closing; provided that nothing herein will relieve any party from liability
for any willful breach hereof prior to the time of termination or common law intentional fraud in the making of any representation or
warranty hereunder, and each party will be entitled to any remedies at law or in equity to recover losses, liabilities or damages arising
from such breach or fraud. The Issuer shall promptly notify Subscriber of the termination of the Merger Agreement promptly after the
termination of such agreement, and shall instruct the Escrow Agent to promptly return any monies paid by the Subscriber to the Escrow
Account in connection herewith to the Subscriber.

 

8.            Trust
Account Waiver. Subscriber acknowledges that the Issuer is a blank check company with the powers and privileges to effect a merger,
amalgamation, share exchange, asset acquisition, share purchase, reorganization or similar business combination involving the Issuer and
one or more businesses or assets. Subscriber further acknowledges that, as described in the Issuer’s prospectus relating to its
initial public offering dated October 26, 2021 (the “Prospectus”), available at www.sec.gov, substantially all
of the Issuer’s assets consist of the cash proceeds of the Issuer’s initial public offering and private placements of its
securities, and substantially all of those proceeds have been deposited in a trust account (the “Trust Account”) for
the benefit of the Issuer, its public shareholders and the underwriters of the Issuer’s initial public offering. Except with respect
to interest earned on the funds held in the Trust Account that may be released to the Issuer to pay its tax obligations, if any, the cash
in the Trust Account may be disbursed only for the purposes set forth in the Prospectus. For and in consideration of the Issuer entering
into this Subscription Agreement, the receipt and sufficiency of which are hereby acknowledged, Subscriber, on behalf of itself and its
affiliates, hereby irrevocably waives any and all right, title and interest, or any claim of any kind they have or may have in the future
arising out of this Subscription Agreement, in or to any monies held in the Trust Account, and agrees not to seek recourse against the
Trust Account as a result of, or arising out of, this Subscription Agreement, the transactions contemplated hereby, or the Acquired Shares,
regardless of whether such claim arises based on contract, tort, equity or any other theory of legal liability; provided, however,
that nothing in this Section 8 shall (i) serve to limit or prohibit Subscriber’s right to pursue a claim against
the Issuer for legal relief against assets held outside the Trust Account, for specific performance or other equitable relief, (ii) serve
to limit or prohibit any claims that Subscriber may have in the future against the Issuer’s assets or funds that are not held in
the Trust Account (including any funds that have been released from the Trust Account and any assets that have been purchased or acquired
with any such funds) or (iii) be deemed to limit any Subscriber’s right, title, interest or claim to the Trust Account by virtue
of such Subscriber’s record or beneficial ownership of SPAC Class A Shares acquired by any means other than pursuant to this
Subscription Agreement, including, but not limited to, any redemption right with respect to any such securities of the Issuer.

 

     

     

    

 

9.            Miscellaneous.

 

9.1            Each party hereto acknowledges
that the other party hereto and the Target will rely on the acknowledgments, understandings, agreements, representations and warranties
contained in this Subscription Agreement; provided, however, that this Section 9.1 shall not give any such
party any rights other than those expressly set forth herein. Prior to the Closing, each party hereto agrees to promptly notify the other
party hereto if any of the acknowledgments, understandings, agreements, representations and warranties made by such party as set forth
herein are no longer accurate in all material respects. Subscriber further acknowledges and agrees that each purchase by Subscriber of
Acquired Shares from the Issuer will constitute a reaffirmation to the Issuer of the acknowledgments, understandings, agreements, representations
and warranties herein (as modified by any such notice) by Subscriber as of the time of such purchase.

 

9.2            Each
of the Issuer, the Target and Subscriber is irrevocably authorized to produce this Subscription Agreement or a copy hereof to any interested
party in any administrative or legal proceeding or official inquiry with respect to the matters covered hereby to the extent required
by law or by regulatory bodies.

 

9.3            Notwithstanding
anything to the contrary in this Subscription Agreement, prior to the Closing, Subscriber may not transfer or assign all or a portion
of its rights under this Subscription Agreement, other than to one or more of its affiliates (including other investment funds or accounts
managed or advised by Subscriber or the investment manager or advisor who acts on behalf of Subscriber or an affiliate thereof or by an
affiliate of such investment manager or advisor) without the prior consent of the Issuer; provided that such transferee or assignee
agrees in writing to be bound by and subject to the terms and conditions of this Subscription Agreement, makes the representations and
warranties in Section 4 and completes Schedule A hereto. In the event of such a transfer or assignment, Subscriber
shall complete the form of assignment attached as Schedule B hereto.

 

9.4            All
the agreements, representations, warranties, and covenants made by each party hereto in this Subscription Agreement shall survive the
Closing. All of the covenants and agreements made by each party in this Subscription Agreement shall survive the Closing until the applicable
statute of limitations or in accordance with their respective terms.

 

9.5            The
Issuer may request from Subscriber such additional information as the Issuer may reasonably deem necessary to evaluate the eligibility
of Subscriber to acquire the Acquired Shares and to register the resale of the Acquired Shares, and Subscriber shall provide such information
as may be reasonably requested, to the extent readily available and to the extent consistent with its internal policies and procedures;
provided that the Issuer agrees to keep any such information provided by Subscriber confidential.

 

9.6            This
Subscription Agreement constitutes the entire agreement, and supersedes all other prior agreements, understandings, representations and
warranties, both written and oral, among the parties, with respect to the subject matter hereof.

 

9.7            Except
as otherwise provided herein, this Subscription Agreement shall be binding upon, and inure to the benefit of the parties hereto and their
respective affiliates and their respective heirs, executors, administrators, successors, legal representatives and permitted assigns,
and the agreements, representations, warranties, covenants and acknowledgments contained herein shall be deemed to be made by, and be
binding upon, such heirs, executors, administrators, successors, legal representatives and permitted assigns.

 

     

     

    

 

9.8            If
any provision of this Subscription Agreement shall be invalid, illegal or unenforceable, the validity, legality or enforceability of the
remaining provisions of this Subscription Agreement shall not in any way be affected or impaired thereby and shall continue in full force
and effect.

 

9.9            This Subscription Agreement
may be executed in two or more counterparts (including by electronic means), all of which shall be considered one and the same agreement
and shall become effective when signed by each of the parties and delivered to the other parties, it being understood that all parties
need not sign the same counterpart.

 

9.10          Each
party shall pay all of its own expenses in connection with this Subscription Agreement and the transactions contemplated herein.

 

9.11          The
parties hereto acknowledge and agree that (i) this Subscription Agreement is being entered into in order to induce the Issuer to
execute and deliver the Merger Agreement and (ii) irreparable damage would occur in the event that any of the provisions of this
Subscription Agreement were not performed in accordance with their specific terms or were otherwise breached and that money or other legal
remedies would not be an adequate remedy for such damage. It is accordingly agreed that the parties shall be entitled to equitable relief,
including in the form of an injunction or injunctions to prevent breaches or threatened breaches of this Subscription Agreement and to
enforce specifically the terms and provisions of this Subscription Agreement, this being in addition to any other remedy to which such
party is entitled at law, in equity, in contract, in tort or otherwise. The parties hereto acknowledge and agree that Target shall be
entitled to rely on the provisions of the Subscription Agreement of which Target is a third party beneficiary on the terms and subject
to the conditions set forth herein. The parties hereto further acknowledge and agree: (x) to waive any requirement for the security
or posting of any bond in connection with any such equitable remedy; (y) not to assert that a remedy of specific enforcement pursuant
to this Section 9.11 is unenforceable, invalid, contrary to applicable law or inequitable for any reason; and (z) to
waive any defenses in any action for specific performance, including the defense that a remedy at law would be adequate..

 

9.12          Any
notice or communication required or permitted hereunder shall be in writing and either delivered personally, emailed or telecopied, sent
by overnight mail via a reputable overnight carrier, or sent by certified or registered mail, postage prepaid, and shall be deemed to
be given and received (i) when so delivered personally, (ii) upon receipt of an appropriate electronic answerback or confirmation
when so delivered by telecopy (to such number specified below or another number or numbers as such person may subsequently designate by
notice given hereunder), (iii) when sent, with no mail undeliverable or other rejection notice, if sent by email or (iv) five
business days after the date of mailing to the address below or to such other address or addresses as such person may hereafter designate
by notice given hereunder:

 

if to Subscriber, to such address or addresses set forth on
the signature page hereto;

 

if to the Issuer, to:

 

Innovative International Acquisition Corp.

24681 La Plaza Ste 300

Dana Point, CA 92629

Attention: [ ]

 

with required copies (which copies shall not constitute notice)
to:

 

McDermott Will & Emery

One Vanderbilt Avenue

New York, NY 10017

Attention: Ari Edelman

Email: aedelman@mwe.com

 

     

     

    

 

9.13            This
Subscription Agreement, and any claim or cause of action hereunder based upon, arising out of or related to this Subscription Agreement
(whether based on law, in equity, in contract, in tort or any other theory) or the negotiation, execution, performance or enforcement
of this Subscription Agreement, shall be governed by and construed in accordance with the laws of the State of New York, without giving
effect to the principles of conflicts of law thereof.

 

9.13.1          THE
PARTIES HERETO IRREVOCABLY SUBMIT TO THE EXCLUSIVE JURISDICTION OF THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK,
THE SUPREME COURT OF THE STATE OF NEW YORK AND THE FEDERAL COURTS OF THE UNITED STATES OF AMERICA LOCATED IN THE STATE OF NEW YORK, SOLELY
IN RESPECT OF THE INTERPRETATION AND ENFORCEMENT OF THE PROVISIONS OF THIS SUBSCRIPTION AGREEMENT AND THE DOCUMENTS REFERRED TO IN THIS
SUBSCRIPTION AGREEMENT AND IN RESPECT OF THE TRANSACTIONS CONTEMPLATED HEREBY, AND HEREBY WAIVE, AND AGREE NOT TO ASSERT, AS A DEFENSE
IN ANY ACTION, SUIT OR PROCEEDING FOR INTERPRETATION OR ENFORCEMENT HEREOF OR ANY SUCH DOCUMENT THAT IS NOT SUBJECT THERETO OR THAT SUCH
ACTION, SUIT OR PROCEEDING MAY NOT BE BROUGHT OR IS NOT MAINTAINABLE IN SAID COURTS OR THAT VENUE THEREOF MAY NOT BE APPROPRIATE
OR THAT THIS SUBSCRIPTION AGREEMENT OR ANY SUCH DOCUMENT MAY NOT BE ENFORCED IN OR BY SUCH COURTS, AND THE PARTIES HERETO IRREVOCABLY
AGREE THAT ALL CLAIMS WITH RESPECT TO SUCH ACTION, SUIT OR PROCEEDING SHALL BE HEARD AND DETERMINED BY SUCH A NEW YORK STATE OR FEDERAL
COURT. THE PARTIES HEREBY CONSENT TO AND GRANT ANY SUCH COURT JURISDICTION OVER THE PERSON OF SUCH PARTIES AND OVER THE SUBJECT MATTER
OF SUCH DISPUTE AND AGREE THAT MAILING OF PROCESS OR OTHER PAPERS IN CONNECTION WITH SUCH ACTION, SUIT OR PROCEEDING IN THE MANNER PROVIDED
IN SECTION 9.12 OR IN SUCH OTHER MANNER AS MAY BE PERMITTED BY LAW SHALL BE VALID AND SUFFICIENT SERVICE THEREOF.

 

9.13.2          EACH
PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY THAT MAY ARISE UNDER THIS SUBSCRIPTION AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE EACH SUCH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES
ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO
THIS SUBSCRIPTION AGREEMENT OR THE TRANSACTIONS CONTEMPLATED BY THIS SUBSCRIPTION AGREEMENT. EACH PARTY CERTIFIES AND ACKNOWLEDGES THAT
(I) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD
NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER; (II) SUCH PARTY UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS
OF THE FOREGOING WAIVER; (III) SUCH PARTY MAKES THE FOREGOING WAIVER VOLUNTARILY AND (IV) SUCH PARTY HAS BEEN INDUCED TO ENTER
INTO THIS SUBSCRIPTION AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVER AND CERTIFICATIONS IN THIS SECTION 9.13.

 

     

     

    

 

9.14          The
Issuer shall, by 9:00 a.m., New York City time, on the second business day immediately following the date of this Subscription Agreement,
issue one or more press releases or file with the Commission a Current Report on Form 8-K (collectively, the “Disclosure
Document”) disclosing all material terms of the transactions contemplated hereby and the Transactions. From and after the issuance
of the Disclosure Document, to the Issuer’s knowledge, Subscriber shall not be in possession of any material, nonpublic information
received from the Issuer or any of its officers, directors or employees. Notwithstanding anything in this Subscription Agreement to the
contrary, the Issuer shall not publicly disclose the name of Subscriber or any of its affiliates, or include the name of Subscriber or
any of its affiliates, without the prior written consent of Subscriber, (i) in any press release (ii) or in any filing with
the Commission or any regulatory agency or trading market, except (A) as required by the federal securities law in connection with
the Registration Statement, or (B) to the extent such disclosure is required by law, at the request of the staff of the Commission
or regulatory agency or under the regulations of Nasdaq or by any other governmental authority, in which case the Issuer shall provide
Subscriber with prior written notice of such disclosure permitted under the foregoing clause (ii).

 

9.15          This
Subscription Agreement may not be amended, modified, supplemented or waived except by an instrument in writing, signed by the party against
whom enforcement of such amendment, modification, supplement or waiver is sought; provided that any rights (but not obligations)
of a party under this Subscription Agreement may be waived, in whole or in part, by an instrument in writing, signed by the party against
whom enforcement of such waiver is sought.

 

9.16          No
failure or delay by a party hereto in exercising any right, power or remedy under this Subscription Agreement, and no course of dealing
between the parties hereto, shall operate as a waiver of any such right, power or remedy of such party. No single or partial exercise
of any right, power or remedy under this Subscription Agreement by a party hereto, nor any abandonment or discontinuance of steps to enforce
any such right, power or remedy, shall preclude such party from any other or further exercise thereof or the exercise of any other right,
power or remedy hereunder. The election of any remedy by a party hereto shall not constitute a waiver of the right of such party to pursue
other available remedies. No notice to or demand on a party not expressly required under this Subscription Agreement shall entitle the
party receiving such notice or demand to any other or further notice or demand in similar or other circumstances or constitute a waiver
of the rights of the party giving such notice or demand to any other or further action in any circumstances without such notice or demand.

 

9.17          The
headings herein are for convenience only, do not constitute a part of this Subscription Agreement and shall not be deemed to limit or
affect any of the provisions hereof. The language used in this Subscription Agreement will be deemed to be the language chosen by the
parties hereto to express their mutual intent, and no rules of strict construction will be applied against any party. Unless the
context otherwise requires, (i) all references to Sections, Annexes or Exhibits are to Sections, Annexes or Exhibits contained in
or attached to this Subscription Agreement, (ii) each accounting term not otherwise defined in this Subscription Agreement has the
meaning assigned to it in accordance with GAAP, (iii) words in the singular or plural include the singular and plural and pronouns
stated in either the masculine, the feminine or neuter gender shall include the masculine, feminine and neuter, (iv) the use of the
word “including” in this Subscription Agreement shall be by way of example rather than limitation, and (v) the word “or”
shall not be exclusive.

 

[Signature pages follow]

 

     

     

    

 

 IN
WITNESS WHEREOF, each of SPAC, the Issuer, and Subscriber has executed or caused this Subscription Agreement to be executed by its duly
authorized representative as of the date first written above.

 

	 	INNOVATIVE INTERNATIONAL ACQUISITION CORP.
	 	 
	 	By:	/s/Madan Menon
	 	Name: Madan Menon
	 	Title: Chief Operating Officer
	 	 
	 	ANANDA SMALL BUSINESS TRUST
	 	 
	 	By:	 /s/Mohan Ananda
	 	Name: Mohan Ananda
	 	Title: Authorized Officer of the Trustee, LVN Enterprises, Inc.

 

     

     

    

 

SUBSCRIBER:

 

Name of Subscriber: ANANDA SMALL BUSINESS TRUST

 

Signature of Subscriber:

   

	By:	/s/ Mohan Ananda	 
	Name: Mohan Ananda  	 
	Title: Authorized Officer of the Trustee, LVN Enterprises, Inc.	 

 

Name in which securities are to be registered (if different):

 

Email Address: 

 

Subscriber’s EIN (as applicable): _______________

 

Address: Attn: _______________________________

 

Telephone No.: __________________________

 

Facsimile No.: __________________________

 

Aggregate Number of Acquired Shares subscribed for: 1,000,000

 

Aggregate
Purchase Price: USD $10,000,000.00

 

 EIN Number (as applicable):

 

You must pay the Purchase Price by wire transfer of U.S. dollars in
immediately available funds to the account specified by the Issuer in the Closing Notice.

 

     

     

    

 

Schedule A

 

Accredited Investor Questionnaire

 

Capitalized terms used and not defined in this
Exhibit A shall have the meanings given in the Subscription Agreement to which this Exhibit A is attached.

 

The undersigned Subscriber represents and warrants
that the undersigned Subscriber is an “accredited investor” (an “Accredited Investor”) as such term is
defined in Rule 501(a) of Regulation D under the U.S. Securities Act of 1933, as amended (the “Securities Act”),
for one or more of the reasons specified below (please check all boxes that apply):

 

	__________	(i)	A natural person whose net worth, either individually or jointly with such person’s spouse or spousal equivalent, at the time of
Subscriber’s purchase, exceeds $1,000,000;
	 	 	 
	 	 	The term “net
                                            worth” means the excess of total assets over total liabilities (including personal
                                            and real property, but excluding the estimated fair market value of Subscriber’s
                                            primary home). For the purposes of calculating joint net worth with the person’s spouse
                                            or spousal equivalent, joint net worth can be the aggregate net worth of Subscriber and spouse
                                            or spousal equivalent; assets need not be held jointly to be included in the calculation.
                                            There is no requirement that securities be purchased jointly. A spousal equivalent means
                                            a cohabitant occupying a relationship generally equivalent to a spouse.
	 	 	 
	__________	(ii)	A natural
person who had an individual income in excess of $200,000, or joint income with Subscriber’s spouse or spousal equivalent in excess
of $300,000, in each of the two most recent years and reasonably expects to reach the same income level in the current year;
	 	 	 
	 	 	In determining individual “income,”
Subscriber should add to Subscriber’s individual taxable adjusted gross income (exclusive of any spousal or spousal equivalent income)
any amounts attributable to tax exempt income received, losses claimed as a limited partner in any limited partnership, deductions claimed
for depletion, contributions to an IRA or Keogh retirement plan, alimony payments, and any amount by which income from long-term capital
gains has been reduced in arriving at adjusted gross income.
	 	 	 
	__________	(iii)	A
director or executive officer of the Company;
	 	 	 
	__________	(iv)	A natural
person holding in good standing with one or more professional certifications or designations or other credentials from an accredited educational
institution that the U.S. Securities and Exchange Commission (“SEC”) has designated as qualifying an individual for
accredited investor status;
	 	 	 
	 	 	The SEC has
                                            designated the General Securities Representative license (Series 7), the Private Securities
                                            Offering Representative license (Series 82) and the Licensed Investment Adviser Representative
                                            (Series 65) as the initial certifications that qualify for accredited investor status.
	 	 	 
	__________	(v)	A natural
person who is a “knowledgeable employee” as defined in Rule 3c-5(a)(4) under the Investment Company Act of 1940
(the “Investment Company Act”), of the issuer of the securities being offered or sold where the issuer would be an
investment company, as defined in section 3 of the Investment Company Act, but for the exclusion provided by either section 3(c)(1) or
section 3(c)(7) of the Investment Company Act;

 

     

     

    

 

	__________	(vi)	A bank
as defined in Section 3(a)(2) of the Securities Act, or any savings and loan association or other institution as defined in
Section 3(a)(5)(A) of the Securities Act, whether acting in its individual or fiduciary capacity;
	 	 	 
	__________	(vii)	A broker or dealer registered pursuant to Section 15
of the Securities Exchange Act of 1934, as amended (the “Exchange Act”);
	 	 	 
	 	 	 
	__________	(viii)	An
investment adviser registered pursuant to section 203 of the Investment Advisers Act of 1940 (the “Investment Advisers Act”)
or registered pursuant to the laws of a state, or an investment adviser relying on the exemption from registering with the SEC under the
section 203(l) or (m) of the Investment Advisers Act;
	 	 	 
	__________	(ix)	An
insurance company as defined in section 2(13) of the Exchange Act;
	 	 	 
	__________	(x)	An investment
company registered under the Investment Company Act or a business development company as defined in Section 2(a)(48) of that Act;
	 	 	 
	__________	(xi)	A Small
Business Investment Company licensed by the U.S. Small Business Administration under Section 301(c) or (d) of the Small
Business Investment Act of 1958;
	 	 	 
	__________	(xii)	A
Rural Business Investment Company as defined in section 384A of the Consolidated Farm and Rural Development Act;
	 	 	 
	__________	(xiii)	A
plan established and maintained by a state, its political subdivisions, or any agency or instrumentality of a state, or its political
subdivisions for the benefit of its employees, if such plan has total assets in excess of $5,000,000;
	 	 	 
	__________	(xiv)	An
employee benefit plan within the meaning of the Employee Retirement Income Security Act of 1974, if the investment decision is made by
a plan fiduciary, as defined in Section 3(21) of such act, which is either a bank, savings and loan association, insurance company,
or registered investment adviser, or if the employee benefit plan has total assets in excess of $5,000,000 or, if a self-directed plan,
with investment decisions made solely by persons that are accredited investors;
	 	 	 
	__________	(xv)	A private
business development company as defined in Section 202(a)(22) of the Investment Advisers Act of 1940;
	 	 	 
	__________	(xvi)	An
organization described in Section 501(c)(3) of the Internal Revenue Code, or a corporation, business trust, partnership, or
limited liability company, or any other entity not formed for the specific purpose of acquiring the Securities, with total assets in excess
of $5,000,000;
	 	 	 
	__________	 (xvii)	A
trust, with total assets in excess of $5,000,000, not formed for the specific purpose of acquiring the Securities, whose purchase is directed
by a sophisticated person who has such knowledge and experience in financial and business matters that such person is capable of evaluating
the merits and risks of investing in the Company;
	 	 	 
	__________	(xviii)	A
 “family office” as defined in Rule 202(a)(11)(G)-1 under the Investment Advisers Act with assets under management in
excess of $5,000,000 that is not formed for the specific purpose of acquiring the securities offered and whose prospective investment
is directed by a person who has such knowledge and experience in financial and business matters that such family office is capable of
evaluating the merits and risks of the prospective investment;

 

     

     

    

 

	__________	 (xix)	A
 “family client” as defined in Rule 202(a)(11)(G)-1 under the Investment Advisers Act, of a family office meeting the
requirements set forth in (xviii) and whose prospective investment in the issuer is directed by a person from a family office that
is capable of evaluating the merits and risks of the prospective investment;
	 	 	 
	__________	(xxi)	An
entity, of a type not listed above, not formed for the specific purpose of acquiring the securities offered, owning investments in excess
of $5,000,000; and/or
	 	 	 
	__________	(xx)	A “qualified institutional buyer” as defined in Rule 144A under the Securities
Act;
	 	 	 
	__________	 (xxii)	An
entity in which all of the equity owners qualify as an accredited investor under any of the above subparagraphs.
	 	 	 
	__________	 (xxiii)	Subscriber
does not qualify under any of the investor categories set forth in (i) through (xxi) above.

 

		2.1	Type of Subscriber. Indicate the form of entity of Subscriber:

 

	 	 ̈	Individual	  ̈	Limited
Partnership	 
	 	 	 	 	 	 
	 	 ̈	Corporation	  ̈	General
Partnership	 
	 	 	 	 	 	 
	 	 ̈	Revocable
Trust	  ̈	Limited
Liability Company	 
	 	 	 	 	 	 
	 	x	Other Type of Trust (indicate type):	Irrevocable
Trust	 
	 	 	 	 	 	 
	 	 ̈	Other (indicate form of organization):	 	 

 

		2.2.1	If Subscriber is not an individual, indicate
                                            the approximate date Subscriber entity was formed:    2011                              .

 

		2.2.2	If Subscriber is not an individual, initial the line below which correctly describes the
application of the following statement to Subscriber’s situation: Subscriber (x) was not organized or reorganized for the specific
purpose of acquiring the Securities and (y) has made investments prior to the date hereof, and each beneficial owner thereof has
and will share in the investment in proportion to his or her ownership interest in Subscriber.

 

		True	     True

 

			     False

 

If the “False” line is initialed,
each person participating in the entity will be required to fill out a Subscription Agreement.

 

	 	Subscriber:
	 	   
	 	Subscriber Name:	Ananda Small Business Trust

 

	 	By:	/s/Mohan Ananda
	 	Signatory Name: Mohan Ananda
	 	Signatory Title: Officer of the Trustee
	 	 
	 	Date: October 11, 2022

 

     

     

    

 

SCHEDULE B

 

FORM OF ASSIGNMENT

 

This Subscription Assignment and Joinder Agreement
(this “Assignment Agreement”), dated          , 2022, is
made and entered into by and between (“Subscriber”) and (“Assignee”) and acknowledged by Innovative
International Acquisition Corp., a Cayman Islands exempted company (“SPAC”). Capitalized terms used but not defined
herein shall have the meanings ascribed to such terms in the Subscription Agreement (as defined below).

 

WHEREAS,
SPAC and Subscriber entered into that certain Subscription Agreement (the “Subscription Agreement”), dated [ ], 2022,
pursuant to which Subscriber agreed to subscribe for and purchase the Issuer’s Common Shares (the “Acquired Shares”)
and SPAC has agreed that the Issuer shall issue and sell to Subscriber such Acquired Shares;

 

WHEREAS,
Subscriber and Assignee are affiliated investment funds; and

 

WHEREAS,
for administrative reasons, Subscriber desires to assign its rights to subscribe for and purchase of the Acquired Shares along with the
rights and obligations set forth in the Subscription Agreement of such Acquired Shares (the “Assigned Shares”) to Assignee.

 

NOW,
THEREFORE, pursuant to Section 9.3 of the Subscription Agreement, and as further described in the table below,
Subscriber hereby assigns its rights to subscribe for and purchase the Assigned Shares to Assignee and Assignee hereby (i) accepts
the rights to subscribe for and purchase the Assigned Shares and agrees to be bound by and subject to the terms and conditions of the
Subscription Agreement, (ii) expressly makes the representations and warranties in Section 4 of the Subscription Agreement
with respect to the Assigned Shares and (iii) completed Schedule A to the Subscription Agreement and attached it hereto. Notwithstanding
the foregoing, this Assignment Agreement shall not relieve Subscriber of any of its obligations under the Subscription Agreement.

 

The following assignment by Subscriber to Assignee of its rights to
subscribe for and purchase all or a portion of the Acquired Shares have been made:

 

	
    Date of

    Assignment
	 	Subscriber	 	Assignee	 	Number of

Acquired Shares

Assigned	 	Subscriber Revised

Subscription

Amount	 	Assignee

Subscription

Amount
	 	 	 	 	 	 	 	 	 	 	 

 

[Signature Page Follows]

 

     

     

    

 

IN
WITNESS WHEREOF, this Subscription Assignment and Joinder Agreement has been executed by Subscriber and Assignee acknowledged
by SPAC by its duly authorized representative as of the date set forth above.

 

	 	SUBSCRIBER
	 	     
	 	By: 	                                                   
	 	 	Name:
	 	 	Title:
	 	 	 
	 	ASSIGNEE
	 	 
	 	By:   	             
	 	 	Name:
	 	 	Title:
	 	 	 
	 	Assignee’s EIN: ______________
	 	 
	 	Address:

                                                                     Attn:

	 	         _______________________________

 

Acknowledgement by SPAC:

	INNOVATIVE INTERNATIONAL

                                                             ACQUISITION CORP. 
	 
	 	 	 
	By:	                  	 
	Name:	 	 
	Title:	 	 

 

[Signature Page to Assignment]Exhibit 10.1
ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT (the “Agreement”) is entered into October 14, 2022, by and between TREES Corporation (f/k/a General Cannabis Corp.), a corporation organized under the laws of Colorado, (“Parent”), Trees Colorado LLC, a limited liability company organized under the laws of Colorado that is a disregarded entity for federal income tax purposes since it is wholly-owned by Standard Cann, Inc. (a wholly-owned subsidiary of Parent) (“Acquirer”), or the assigns of Parent and Acquirer, STATION 2, LLC, a limited liability company organized under the laws of Colorado (STATION 2, LLC, with its subsidiaries, affiliates and assigns, “Acquired Corporation”), and Timothy Brown, an individual residing in Colorado (“Member”). Parent, Acquirer, Acquired Corporation (each together with their respective subsidiaries, affiliates and assigns) and Member are sometimes referred to individually as a “Party” and collectively as the “Parties.”
SECTION I
DEFINITIONS AND CONSTRUCTION
1.1.Capitalized terms have the meanings set forth below unless defined elsewhere in this Agreement.
“Action” means action, arbitration, grievance, audit, hearing, investigation, litigation, suit or other proceeding.
“Acquired Corporation” shall have the meaning set forth in the Preamble of this Agreement.
“Acquired Corporation’s Financial Statements” shall have the meaning set forth in Section 2.13.
“Acquirer” shall have the meaning as set forth in the Preamble of this Agreement.
“Affiliate” means any Person that directly or indirectly through one or more intermediaries, Controls, is Controlled by or is under common Control with the Person specified.
“Affiliated Acquisitions” shall have the meaning as set forth in Recital H of the Agreement.
“Agreement” shall have the meaning set forth in the Preamble of this Agreement.
“Applicable Local Licensing Authority” means the local Government Agency with regulatory authority over each License of the Acquired Corporation.
“Application Fees” means all fees paid to Governmental Authorities associated with the Change of Ownership applications.
“Assets” means substantially all of the assets of each Acquired Corporation, including without limitation, the Licenses; all stores/dispensaries; leasehold interests and real property interests; inventory, furniture, fixtures, business personal property of any kind, nature, character, or description, operated, owned, or leased by Acquired Corporation at the Leased Premises, and any and all intellectual property owned by Acquired Corporation, as more fully described on Exhibit B.
​
​

“Board” shall have the meaning as set forth in Section 4.11(a).
“Business” shall have the meaning as set forth in Recital B of the Agreement.
“Business Day” means a day other than Saturday, Sunday, or any day on which banks located in the State of Colorado are authorized or obligated to close.
“Capital Stock” shall have the meaning as set forth in Section 3.8.
“CERCLA” means the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, and any rules or regulations promulgated thereunder.
“Change of Ownership” means the transfer of ownership of the Licenses from Acquired Corporation to Acquirer.
“Charter Documents” means with respect to any Person, the articles or certificate of incorporation, formation or organization and by-laws, the limited partnership agreement, the partnership agreement or the limited liability company agreement, or such other organizational documents of the Person, including those that are required to be registered or kept in the place of incorporation, organization or formation of the Person and which establish the legal personality of the Person.
“Claim” means any demand, claim, action, investigation, or Proceeding.
“Claiming Party” shall have the meaning as set forth in Section 8.3(a).
“Closing” and “Closing Date” shall have the meanings respectively as set forth in Exhibit A of the Agreement.
“Code” means the Internal Revenue Code of 1986, as amended.
“Contract” means any legally binding written contract, lease, license, evidence of indebtedness, mortgage, indenture, purchase order, binding bid, letter of credit, security agreement or other written and legally binding arrangement.
“Control” means the power, direct or indirect, to direct or cause the direction of the management and policies of a Person whether through ownership of voting securities or ownership interests, by Contract or otherwise, and specifically with respect to a corporation, partnership or limited liability company, means direct or indirect ownership of at least 50% of the voting securities in the corporation or of the voting interest in a partnership or limited liability company.
“Corporation” shall have the meaning as set forth in the Preamble of this Agreement.
“Dispute Notice” shall have the meaning as set forth in Section 8.1(c)(i).
“Dispute Period” shall have the meaning as set forth in Section 8.1(c)(i).
“Disqualified Designee” shall have the meaning as set forth in Section 4.11(c).
“Disqualification Event” shall have the meaning as set forth in Section 4.11(c).
“Environmental Laws” means judgments, decrees, orders, laws, statutes, license rules or regulations of any governmental authority related to health, safety, or the environment, or pertaining to environmental matters, the protection of the environment, protection of health and safety, including, without limitation, any Release or threatened Release, of any Hazardous
​

2

Materials, or otherwise relating to the treatment, storage, disposal, transport or handling of any Hazardous Materials.
“Exchange Act” means the Securities Exchange Act of 1934, as amended.
“Excluded Liabilities” shall have the meaning as set forth in Section 4.12.
“Final Governmental Approval” means the final decisions by the MED and/or the OLCC, as applicable, and the Applicable Local Licensing Authority in writing approving the Change of Ownership, and such approvals (a) do not include any responsibility of Acquirer, Parent or Parent’s owners for the actions of Acquired Corporation or Acquired Corporation’s owner with respect to an administrative investigation or administrative disciplinary action by the MED or the OLCC, as applicable, or the Applicable Local Licensing Authority; and (b) do not subject Acquirer, Parent or Parent’s owners to discipline by the MED or the OLCC, as applicable, or the Applicable Local Licensing Authority for the actions of Acquired Corporation or Acquired Corporation’s owner with respect to an administrative investigation or administrative disciplinary action by the MED or the OLCC, as applicable, or the Applicable Local Licensing Authority.
“GAAP” means generally accepted accounting principles in the United States of America.
“Governmental Authority” means the government of the United States of America, any other nation or any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government.
“Governmental Authorizations” means any authorization, order, permit, approval, grant, license, quota, consent, commitment, right, franchise, privilege, certificate, judgment, writ, injunction, award, determination, direction, decree or demand or the like which may be issued or granted by law or by rule or regulation of any Governmental Authority.
“Hazardous Materials” means any element, compound, chemical mixture, contaminant, pollutant, material, waste or other substance that is defined, determined or identified as hazardous or toxic under any laws or the Release of which is prohibited or restricted under any laws into or onto the environment.
“Interim Period” means the time period from the date of this Agreement through and including the Closing.
“Knowledge” when used in a particular representation or warranty in this Agreement, means the actual knowledge (as opposed to any constructive or imputed knowledge) of a Party or its owners, without inquiry.
“Laws” means all laws, statutes, rules, regulations, ordinances, and other pronouncements having the effect of law of a Governmental Authority, except for any United States federal law, rule or regulation related to marijuana which this Agreement may violate.
“Liability” means any liability, debt, obligation, trade accounts payable, not payable, loss damage, claim, penalty, fine, duty, guarantee, cost, expense or other charge (including costs of investigation and defense and attorneys’ fees, costs and expenses) of any kind or nature, in each case, whether direct or indirect, accrued or unaccrued, known or unknown, liquidated or
​

3

unliquidated, asserted or unasserted, absolute or contingent, matured or unmatured or disputed or undisputed, including those arising under any Law.
“Leased Premises” means 468 S Federal Blvd., Denver Colorado 80219.
“Licenses” means the following licenses held by Acquired Corporation and any other applicable licenses of Acquired Corporation in the States of Colorado and Oregon:
(a)State of Colorado Retail Marijuana Store License number 402R-00884 and corresponding City and County of Denver Retail Marijuana Store License;
(b)State of Colorado Medical Marijuana Center License number 402-01263 and corresponding City and County of Denver Medical Marijuana Center License;
“Lien” means, with respect to any property, any lien, security interest, mortgage, pledge, hypothecation, pledge, assignment, participation, deposit arrangement, deed of trust, encumbrance, preference, privity right of interest or other security agreement or preferential arrangement of any kind or nature whatsoever, including any conditional sale or other title retention agreement, title defect, right of way, easement, encroachment, and any financing arrangement having substantially the same economic effect as any of the foregoing..
“Loss” means any and all losses, judgments, liabilities, amounts paid in settlement, damages, fines, penalties, deficiencies, losses, and expenses (including interest, court costs, reasonable fees of attorneys, accountants and other experts or other reasonable expenses of litigation or other Proceedings or of any Claim, default or assessment), but only to the extent the losses (a) are not reasonably expected to be covered by a payment from some third party or by insurance or otherwise recoverable from third parties, and (b) are net of any associated benefits arising in connection with the loss.
“Marijuana Code” means collectively, as applicable, Sections 14 and 16 of Article XVIII of the Colorado Constitution, the Colorado Marijuana Code, §§ 44-10-101, et seq., C.R.S., together with §§475B et. al of the Oregon Revised Statues, as the same may be supplemented or amended from time to time, together with the regulations promulgated thereunder, and all applicable local Laws and regulations thereto promulgated by a Governmental Authority.
“Material Adverse Effect” means any occurrence, condition, change, development, event or effect that has or could reasonably be expected to have a materially adverse effect on the assets, properties, financial condition, or results of operations on a Party, as the context dictates, taken as a whole.
“MED” means the Colorado Marijuana Enforcement Division and/or any other applicable Colorado regulatory authority.
“Member” shall have the meaning as set forth in the Preamble of this Agreement.
“OLCC” means the Oregon Liquor Control Commission.
“Parent” shall have the meaning set forth in the Preamble of this Agreement.
“Parent Financial Statements” shall have the meaning set forth in Section 3.12.
“Parent Material Adverse Effect” means the following events (and no others): (i) a “stop trading” order issued by the OTC in respect of the common stock of Parent; or (ii) commencement
​

4

of an enforcement action by a Governmental Authority against Parent or issuance of an order enjoining trading of Parent’s common stock.
“Parent Permits” shall have the meaning as set forth in Section 3.11(a).
“Party” shall have the meaning as set forth in the Preamble of this Agreement.
“Permits” means all licenses (including the Licenses), permits, certificates of authority, authorizations, approvals, registrations, franchises, and similar consents granted by a Governmental Authority related to the transactions contemplated by this Agreement.
“Person” means any natural person, corporation, general partnership, limited partnership, limited liability company, proprietorship, other business organization, trust, union, association, or Governmental Authority.
“Proceeding” means any complaint, lawsuit, action, suit, Claim (including claim of a violation of Law), or other proceeding at law or in equity or order or ruling, in each case by or before any Governmental Authority or arbitral tribunal.
“Purchase Price” means the consideration paid by Acquirer to Acquired Corporation for the Assets, as more particularly described on Exhibit A.
“Recent SEC Report” means Parent’s Annual Report on Form 10-K filed with the SEC for the fiscal year ended December 31, 2020.
“Release” means any release, spill, discharge, emission, leaking, pumping, injection, deposit, disposal, dumping, dispersal, leaching, escaping, emanation, or migration.
“Responding Party” shall have the meaning as set forth in Section 8.3(a).
“S Corp” means a limited liability company or a corporation that has elected to be taxed as an S Corporation under Section 1361 et seq. of the Code.
“Securities Act” means the Securities Act of 1933, as amended.
“Securities Laws” shall have the meaning set forth in Section 3.11(a)
“Set-Off Notice” shall have the meaning as set forth in Section 8.1(c)(i)
“SEC” means the United States Securities and Exchange Commission.
“Signing Date” means the date of execution and delivery of this Agreement.
“Tax” or ”Taxes” means any federal, state, provincial, local or foreign net income, gross income, gross receipts, windfall profit, severance, property, production, sales, use, license, excise, franchise, employment, payroll, withholding, alternative or add-on minimum, ad-valorem, value added, transfer, stamp, or environmental tax, or any other tax, custom, duty, governmental fee or other like assessment or charge or any kind whatsoever, together with any interest or penalty, addition to tax or additional amount imposed by any Governmental Authority (each a “Tax,” and collectively, “Taxes”).
“Tax Return” means any declaration, report, statement, form, return or other document or information required to be supplied to a Governmental Authority in connection with Taxes, including any schedule or attachment thereto, and including any amendment thereof.
​

5

“Trees Designee” shall have the meaning as set forth in Section 4.11(a).
1.2.Rules of Construction.
(a)All article, section, subsection, schedules and exhibit references used in this Agreement are to articles, sections, subsections, schedules and exhibits to this Agreement unless otherwise specified. The exhibits and schedules attached to this Agreement constitute a part of this Agreement and are incorporated herein for all purposes.
(b)If a term is defined as one part of speech (such as a noun), it has a corresponding meaning when used as another part of speech (such as a verb). Unless the context of this Agreement clearly requires otherwise, words importing the masculine gender include the feminine and neutral genders and vice versa. Words in the plural form include the singular form, and words in the singular form include the plural form. The words “includes” or “including” means “including without limitation,” the words “hereof,” “hereby,” “herein,” “hereunder” and similar terms in this Agreement refer to this Agreement as a whole and not any particular section or article in which the words appear and any reference to a Law includes any rules and regulations promulgated thereunder. Currency amounts referenced herein are in U.S. dollars.
(c)Whenever this Agreement refers to a number of days, the number refers to calendar days unless Business Days are specified. Whenever any action must be taken hereunder on or by a day that is not a Business Day, then the action may be validly taken on or by the next day that is a Business Day.
(d)Each Party and its respective attorneys have been given an equal opportunity to negotiate the terms and conditions of this Agreement, and any rule of construction to the effect that ambiguities are to be resolved against the drafting Party or any similar rule operating against the drafter of an agreement will not be applicable to the construction or interpretation of this Agreement.
SECTION II.
ACQUIRED CORPORATION’S REPRESENTATIONS AND WARRANTIES
Acquired Corporation and Member, jointly and severally, covenants, represents, and warrants to Acquirer and Parent that the statements set forth in this Section II are true and correct as of the date hereof and as of the Closing Date:
2.1.Acquired Corporation’s Organization.  Acquired Corporation is a limited liability company duly formed, validly existing and in good standing under each of the Laws of the State of Colorado and has all requisite limited liability company power and authority to conduct its Business as it is now being conducted in accordance with the Laws.
2.2.Authority. Acquired Corporation has all requisite power and authority to execute and deliver this Agreement and each other agreement, document, and instrument related to or contemplated by this Agreement (collectively, the “Transaction Documents”) to which Acquired Corporation is a party, to perform its obligations hereunder and thereunder, and to consummate the transactions contemplated hereby and thereby. Subject to approvals required by the Marijuana Code, the execution and delivery of this Agreement and the Transaction Documents to be delivered by Acquired Corporation at the Closing, and the performance by Acquired Corporation of its
​

6

obligations hereunder and thereunder, have been duly and validly authorized by necessary action. This Agreement has been, and the Transaction Documents to be delivered by Acquired Corporation at the Closing will at the Closing be, duly and validly executed and delivered by Acquired Corporation and constitute (or, in the case of Transaction Documents to be delivered by Acquired Corporation at the Closing, will at the Closing constitute) the legal, valid and binding obligation of Acquired Corporation enforceable against it in accordance with its terms, except as the same may be limited by bankruptcy, insolvency, reorganization, fraudulent conveyance, arrangement, moratorium or other similar Laws relating to or affecting the rights of creditors generally, or by general equitable principles.
2.3.No Conflicts; Consents and Approvals. The execution and delivery by Acquired Corporation of this Agreement do not, and the performance by Acquired Corporation of its obligations under this Agreement does not:
(a)violate or result in a breach of its Charter Documents;
(b)violate or result in a default under any material Contract to which Acquired Corporation is a party, except for any violation or default that would not be expected to result in a Material Adverse Effect on Acquired Corporation’s ability to perform its obligations hereunder; or
(c)(i) violate or result in a breach of any Law applicable to Acquired Corporation or (ii) require any consent or approval of any Governmental Authority other than the MED and the OLCC and the Applicable Local Licensing Authority and under any Law applicable to Acquired Corporation.
2.4.Proceedings. Except as disclosed herein, there is no Proceeding pending, or to Acquired Corporation’s Knowledge threatened, against Acquired Corporation (i) before or by any Governmental Authority, which seeks a writ, judgment, order or decree restraining, enjoining, or otherwise prohibiting or making illegal any of the transactions contemplated by this Agreement; or (ii) brought by or in respect of any third party.
2.5.Broker. Acquired Corporation does not have any liability or obligation to pay fees or commissions to any broker, finder, or agent with respect to the transactions contemplated by this Agreement for which Acquired Corporation or any of its Affiliates could become liable or obligated.
2.6.Compliance with Laws and Orders. Acquired Corporation is in compliance with all Laws and orders applicable to it except where any non-compliance would not reasonably be expected to result in a Material Adverse Effect on Acquired Corporation; provided, however, that this Section 2.6 does not address matters relating to Taxes, which are exclusively addressed by Section 2.7 or Permits, which are exclusively addressed by Section 2.8. Acquired Corporation has no Knowledge of any fact, circumstance, or condition which could cause the Assets or the Leased Premises to violate the Marijuana Code concerning required testing or contaminants. Acquired Corporation has no Knowledge of any fact, circumstance, or condition which could cause the Assets or the Leased Premises to violate the Colorado Pesticide Applicator’s Act, C.R.S. §§ 35-10-101, et. seq. or the Oregon State Pesticide Control Act, ORS §§ 634.005 et seq., as may be applicable to each Acquired Corporation.
​

7

2.7.Taxes. (a) All Tax Returns that are required to have been filed by Acquired Corporation have been duly and timely filed; (b) all Taxes that are required to have been paid by Acquired Corporation have been duly and timely paid or will be paid in full on or before Closing; (c) all withholding Tax requirements imposed on Acquired Corporation have been satisfied in full or will be satisfied in full in all respects on or before Closing; (d) Acquired Corporation does not have in force any waiver of any statute of limitations with respect to Taxes or any extension of time with respect to a Tax assessment or deficiency; and (e) to the Knowledge of Acquired Corporation and Member, there are no threatened, pending, or active audits or Proceedings involving unpaid Taxes of Acquired Corporation or Member.
2.8.Permits. Acquired Corporation possesses all Permits that are required for the ownership and operation of its Business in the manner in which it is currently owned. All Permits described in this Section 2.8 are in full force and effect, and to the Knowledge of Acquired Corporation, Acquired Corporation is in compliance with each such Permit in all material respects.
2.9.Operating Facility. The licensed business at each Leased Premises is a Retail Marijuana Store, as defined in the Marijuana Code in Colorado, or a marijuana retailer, as defined by the Marijuana Code in Oregon, depending on the state in which the Acquired Corporation operates.
2.10.Acquired Corporation’s Members. Member is the only member of Acquired Corporation.
2.11.Environmental Matters.
(a)Acquired Corporation is in material compliance with all Environmental Laws and any other limitations, restrictions, conditions, standards, prohibitions, requirements, obligations, schedules and timetables contained in such Environmental Laws, insofar as failure to comply with the same could result in any liability affecting, or other reduce the value of the Assets. Acquired Corporation has no Knowledge of any liabilities arising in connection with or in any way relating to the Assets of any kind whatsoever, whether accrued, contingent, absolute, determined, determinable or otherwise, arising under or relating to any Environmental Law, and has no Knowledge of any facts, events, conditions, situations or set of circumstances which could reasonably be expected to result in or be the basis for any such liability.
(b)There has not been any event, condition, circumstance, activity, practice, incident, action or plan which will interfere with or prevent continued compliance with or which would give rise to any liability under any Environmental Law or give rise to any common law or statutory liability, based on or resulting from Acquired Corporation’s or its agents’ manufacture, processing, distribution, use, treatment, storage, disposal, transport, or handling, or the emission, discharge, or release into the environment, of any Hazardous Materials, that could result in any liability affecting, or other reduce the value of, the Assets or Business. Acquired Corporation has taken all actions necessary under applicable requirements of Environmental Law to register any products or materials required to be registered by Acquired Corporation (or any of its agents) thereunder. There is no Proceeding, notice or demand letter pending or, to the Knowledge of Acquired Corporation, threatened against Acquired Corporation relating in any way to
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Environmental Laws, or notice or demand letter issued, entered, promulgated or approved thereunder. No property now or previously owned, leased or operated by Acquired Corporation, nor any property to which Hazardous Materials located on or resulting from the use of any Asset or the Leased Premises have been transported, is listed or, to Acquired Corporation’s Knowledge, proposed for listing on the National Priorities List promulgated pursuant to CERCLA, on CERCLIS (as defined in CERCLA) or on any similar federal, state, local or foreign list of sites requiring investigation or cleanup.
2.12.Disclosure of Information. Acquired Corporation has had an opportunity to discuss to Acquired Corporation’s satisfaction Parent’s business, management and financial affairs with Parent’s management and has had an opportunity to review Parent’s business. Such discussions, as well as any written information delivered by Acquirer and Parent to Acquired Corporation, were intended to describe the aspects of Parent’s business which Acquirer and Parent believe to be material.  Further, Acquired Corporation acknowledges that it has reviewed Parent’s filings with the SEC, including Forms 10-K, 10-Q and 8-K, and has had the opportunity to ask questions of management of Parent concerning Parent’s business, operations and financial condition.
2.13.Financial Statements.  Acquired Corporation has delivered to Acquirer and Parent the most recent consolidated financial statements of Acquired Corporation as of December 31, 2020 (the “Acquired Corporation Financial Statements”). The Acquired Corporation Financial Statements:
(a)Fairly and accurately present the financial position of Acquired Corporation as at the respective dates thereof and the consolidated results of their operations and cash flows for the respective periods then ended, and the results of operations, changes in shareholders’ equity, and cash flow of Acquired Corporation as at the dates and as of the periods specified;
(b)do not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading; and
(c)were prepared in accordance with GAAP.
2.14.Undisclosed Liabilities. Except for matters reflected or reserved against in the Acquired Corporation Financial Statements, the Acquired Corporation did not have, as of the date of the Acquired Corporation Financial Statements, nor has incurred since that date, any liabilities of any nature that would be required under GAAP to be reflected on a balance sheet of Acquired Corporation (including the notes thereto), except liabilities or obligations which (i) were incurred in the ordinary course of the Acquired Corporation’s business consistent with past practice or (ii) have not had, and could not be reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect on the Acquired Corporation.
2.15.Absence of Certain Changes.  Except as set forth in Schedule 2.15, as of the date of this Agreement, since the date of the Acquired Corporation Financial Statements, the Acquired Corporation has conducted its business consistent with past practice; and other than in the ordinary course of business of Acquired Corporation consistent with past practice, with respect to the business of Acquired Corporation, there has not been any:
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(a)change, event or development having, or that could be reasonably expected to have a Material Adverse Effect on Acquired Corporation or the financial condition of Acquired Corporation, and Acquired Corporation has no Knowledge of any facts or circumstances that will likely result in or have a Material Adverse Effect on Acquired Corporation or the financial condition of Acquired Corporation;
(b)material change in any method of accounting or accounting practice for the business of Acquired Corporation except as required by GAAP or as disclosed in the notes to the Acquired Corporation Financial Statements;
(c)material change in cash management practices and policies, inventory control, prepayment of expenses, payment of trade accounts payable, accrual of other expenses, deferral of revenue and acceptance of customer deposits;
(d)transfer, assignment, sale or other disposition of any material assets of Acquired Corporation shown or reflected in the Acquired Corporation Financial Statements, except for the sale of inventory in the ordinary course of business;
(e)cancellation of any material debts or claims or amendment, termination or waiver of any rights which could, individually or in the aggregate, have a Material Adverse Effect on the business of the Acquired Corporation;
(f)material damage, destruction or loss, or any material interruption in use, of any material portion of the assets of Acquired Corporation (whether or not covered by insurance) which could, individually or in the aggregate, have a Material Adverse Effect on the business of Acquired Corporation;
(g)acceleration, termination, material modification to or cancellation of any contract, agreement or permit of Acquired Corporation which could, individually or in the aggregate, have a Material Adverse Effect on the business of Acquired Corporation;
(h)action to accelerate the vesting or payment of any compensation or benefit for any current or former employee, officer, director, consultant or independent contractor of Acquired Corporation;
(i)any loan to (or forgiveness of any loan to), or entry into any other transaction with, any current or former directors, officers, or employees of Acquired Corporation;
(j)adoption of any plan of merger, consolidation, reorganization, liquidation or dissolution or filing of a petition in bankruptcy under any provisions of federal or state bankruptcy law or consent to the filing of any bankruptcy petition against Acquired Corporation under any similar law; or
(k)contract or agreement entered into pursuant to which Acquired Corporation is obligated to do any of the foregoing.
2.16.Intellectual Property.  Any and all intellectual property owned or leased by Acquired Corporation and/or used in the operation of Business, including without limitation, any trademarks, designs, patents or copyrights (“Intellectual Property”), is free and clear of any and all Liens and Acquired Corporation has such rights of ownership therein, free and clear of all Liens,
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as are necessary to permit the Acquired Corporation to conduct the Business as presently conducted.  There are no Claims pending, or to the knowledge of Acquired Corporation, threatened, by any Person relating to Acquired Corporation’s use or ownership of any Intellectual Property.  Acquired Corporation is not obligated to pay any royalty or similar fee to any Person in connection with the use of license of any Intellectual Property.
2.17.No Inducement or Reliance; Independent Assessment.  With respect to the Assets and the transactions contemplated by this Agreement and the Transaction Documents, each of Acquired Corporation and Member shall only be entitled to rely on the representations, warranties and statements that are expressly set forth herein (including the Exhibits and Schedules hereto), and (in the absence of fraud) neither Acquired Corporation nor Member will not have any right or remedy arising out of any other representation, warranty or statement.
(Collectively, the covenants, representations, warranties and statements set forth in this Section II are referred to as “Acquired Corporation’s Representations and Warranties”).
SECTION III.
ACQUIRER’S AND PARENT’S REPRESENTATIONS AND WARRANTIES
Except as set forth in the corresponding numbered sections of the Parent Disclosure Schedules, Acquirer and Parent covenant, represent, and warrant to Member and Acquired Corporation that the statements set forth in this SECTION III are true and correct as of the date hereof and as of the Closing Date.
3.1.Organization of Acquirer. Acquirer is Trees Colorado LLC, a limited liability company organized under the laws of Colorado that is a disregarded entity for federal income tax purposes since it is wholly-owned by Standard Cann, Inc. (a wholly-owned subsidiary of Parent), duly formed, validly existing and in good standing under the Laws of the State of Colorado. Acquirer has not conducted any operations prior to the execution of this Agreement and has no material assets or liabilities.
3.2.Authority of Acquirer. Acquirer has all requisite power and authority to execute and deliver this Agreement and the Transaction Documents to be delivered by Acquirer at the
Closing, to perform its obligations hereunder and thereunder, and to consummate the transactions contemplated hereby and thereby. The execution and delivery by Acquirer of this Agreement and the Transaction Documents to be delivered by Acquirer at the Closing, and the performance by Acquirer of its obligations hereunder and thereunder, have been duly and validly authorized by all necessary action. This Agreement has been, and the Transaction Documents to be delivered by Acquirer at the Closing will at the Closing be, duly and validly executed and delivered by Acquirer and constitutes (or, in the case of instruments to be delivered by Acquirer at the Closing, will at the Closing constitute) the legal, valid and binding obligations of Acquirer enforceable against Acquirer in accordance with their terms, except as the same may be limited by bankruptcy, insolvency, reorganization, fraudulent conveyance, arrangement, moratorium or other similar Laws relating to or affecting the rights of creditors generally, or by general equitable principles.
3.3.No Conflicts; Consents and Approvals for Acquirer. The execution, delivery and performance by Acquirer of this Agreement and the Transaction Documents to which it is a party, and the consummation of the transactions contemplated hereby and thereby, do not and will not:
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(a)conflict with or result in a violation or breach of, or default under, any provision of the Charter Documents of Acquirer;
(b)conflict with or result in a violation or breach of any provision of any law or governmental order applicable to the Acquirer;
(c)violate or result in a default under any material Contract to which Acquirer is a party, except for any such violation or default that would not reasonably be expected to result in a Material Adverse Effect on Acquirer’s ability to perform its obligations hereunder;
(d)violate or result in a breach of any Law applicable to Acquirer or (ii) require any consent, approval, permit, governmental order, declaration or filing of or with, or notice to, any Governmental Authority (other than the MED, the OLLC. and any Applicable Local Licensing Authority) under any Law applicable to Acquirer; or
(e)result in the creation or imposition of any Lien upon any material assets or properties used by Acquirer in connection with its business.
3.4.Organization of Parent. Parent is a corporation duly formed, validly existing and in good standing under the Laws of the State of Colorado.  Parent has all requisite corporate power and authority to own, operate, or lease the properties and assets now owned, operated, or leased by it and to carry on its business as currently conducted.
3.5.Authority of Parent. Parent has all requisite power and authority to execute and deliver this Agreement and the Transaction Documents to be delivered by Parent at the Closing, to perform its obligations hereunder and thereunder, and to consummate the transactions contemplated hereby and thereby. The execution and delivery by Parent of this Agreement and the Transaction Documents to be delivered by Parent at the Closing, and the performance by Parent of its obligations hereunder and thereunder, have been duly and validly authorized by all necessary action. This Agreement has been, and the Transaction Documents to be delivered by Parent at the Closing will at the Closing be, duly and validly executed and delivered by Parent and constitutes (or, in the case of instruments to be delivered by Parent at the Closing, will at the Closing constitute) the legal, valid and binding obligations of Parent enforceable against Parent in accordance with their terms, except as the same may be limited by bankruptcy, insolvency, reorganization, fraudulent conveyance, arrangement, moratorium or other similar Laws relating to or affecting the rights of creditors generally, or by general equitable principles.
3.6.No Conflicts; Consents and Approvals for Parent. The execution, delivery and performance by Parent of this Agreement and the Transaction Documents to which it is a party, and the consummation of the transactions contemplated hereby and thereby, do not and will not:
(a)conflict with or result in a violation or breach of, or default under, any provision of the Charter Documents of Parent;
(b)conflict with or result in a violation or breach of any provision of any law or governmental order applicable to the Parent;
(c)violate or result in a default under any material Contract to which Parent is a party, except for any such violation or default that would not reasonably be expected to result in a Material Adverse Effect on Parent’s ability to perform its obligations hereunder;
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(d)violate or result in a breach of any Law applicable to Parent or (ii) require any consent, approval, permit, governmental order, declaration or filing of or with, or notice to, any Governmental Authority (other than the MED, the OLLC. and any Applicable Local Licensing Authority) under any Law applicable to Parent; or
(e)result in the creation or imposition of any Lien upon any material assets or properties used by Parent in connection with its business.
3.7.Legal Proceedings.
(a)Except as set forth in Schedule 3.7 of the Parent’s Disclosure Schedules, there are no Actions pending or, to Parent’s Knowledge, threated against or by Parent that challenge or seek to prevent, enjoin, or otherwise delay the transactions contemplated by this Agreement. No event has occurred nor do circumstances exist that may give rise or serve as a basis for any such Action.
(b)Except as set forth in Schedule 3.7 of the Parent’s Disclosure Schedules, there are no Actions pending or, to Parent’s Knowledge, threatened against or by the Parent relating to or affecting the business of Parent which could be reasonably expected to have a Material Adverse Effect on Parent or materially interfere with Parent’s ability to consummate the transactions contemplated by this Agreement.
(c)Except as set forth in Schedule 3.7 of the Parent’s Disclosure Schedules, there are no outstanding orders and no unsatisfied judgments, penalties or awards against, relating to or affecting the business of Parent which could be reasonably expected to have a Material Adverse Effect on Parent or materially interfere with Parent’s ability to consummate the transactions contemplated by this Agreement.
3.8.Capitalization.  The capitalization of Parent is as set forth on the Recent SEC Report.  All authorized shares of capital stock of Parent (“Capital Stock”) are duly authorized, validly issued, fully paid and nonassessable. Except as set forth in the Recent SEC Report and this Agreement, there are no voting trusts, proxies, or other commitments, understandings, restrictions, or arrangements with respect to, or in any way effecting the voting or the right to participate in distributions or other earnings on, or registration of, any Capital Stock.
3.9.Compliance with Laws; Permits. Parent holds all permits, licenses, variances, exemptions, orders and approvals of all governmental and regulatory authorities necessary for the lawful conduct of its business (the “Parent Permits”), except for failures to hold such permits, licenses, variances, exemptions, orders and approvals which, individually or in the aggregate, are not having and could not be reasonably expected to have a Material Adverse Effect on Parent.  Parent is in compliance with the terms of all Parent Permits, except failures so to comply which, individually or in the aggregate, are not having and could not be reasonably expected to have a Material Adverse Effect on Parent.  Parent is not in violation of or default under any law or order of any governmental or regulatory authority, except for such violations or defaults which, individually or in the aggregate, are not having and could not be reasonably expected to have a Material Adverse Effect on Parent.
3.10.Broker. Parent does not have any liability or obligation to pay fees or commissions to any broker, finder, or agent with respect to the transactions contemplated by this Agreement for which Acquired Corporation or any of its Affiliates could become liable or obligated.
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3.11.SEC Filings; Securities Law Matters.
(a)SEC Filings. Parent has filed with the SEC all reports, schedules, forms, statements, and other documents required to be filed with the SEC since January 1, 2020.  Parent’s SEC filings (including financial statements) comply in all material respect with all applicable laws and stock exchange requirements, and did not, as of the date filed (or, if amended or superseded by a subsequent filing prior to the Closing Date, on the date of such filing), contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements contained therein not misleading in light of the circumstances in which they are made. There are no outstanding or unresolved comments in comment letters from any governmental authority with respect to any of Parent’s filings and to the Knowledge of Parent, Parent is not subject of an ongoing audit, review, comment or investigation by any securities commission. Except as publicly disclosed, there is not presently any material change, as defined under U.S. securities laws, relating to Parent or any change in any material fact, as defined under U.S. securities laws, relating to any of the Parent’s common stock, which has not been fully disclosed in accordance with the requirements of all laws and regulations in any way related to securities or the issuance or sale thereof (collectively, “Securities Laws”).
(b)Securities Law Matters. The Capital Stock is listed and posted for trading on the OTCQB. Parent is not in default of any material requirements of any Securities Laws or the rules and regulations of the OTCQB.  No delisting, suspension of trading or cease trade or other order or restriction with respect to any securities of Parent is pending, in effect, has been threatened, or is expected to be implemented or undertaken, and Parent is not subject to any formal or informal review, enquiry, investigation or other proceeding relating to any such order or restriction. Parent has timely filed or furnished to any governmental authority all material forms, reports, schedules, statements and other material documents required to be filed under Securities Laws or furnished by Parent with the appropriate governmental authority.
3.12.Financial Statements.  Parent has delivered to Member the Recent SEC Report containing consolidated financial statements of Parent as of December 31, 2020 (the “Parent Financial Statements”). The Parent Financial Statements:
(a)Fairly and accurately present the financial position of Parent as at the respective dates thereof and the consolidated results of their operations and cash flows for the respective periods then ended, and the results of operations, changes in shareholders’ equity, and cash flow of Parent as at the dates and as of the periods specified;
(b)do not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading; and
(c)were prepared in accordance with GAAP.
3.13.Undisclosed Liabilities. Except for matters reflected or reserved against in the Parent Financial Statements, the Parent did not have, as of the date of the Parent Financial Statements, nor has incurred since that date, any liabilities of any nature that would be required
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under GAAP to be reflected on a balance sheet of Parent (including the notes thereto), except liabilities or obligations which (i) were incurred in the ordinary course of the Parent’s business consistent with past practice or (ii) have not had, and could not be reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect on the Parent.
3.14.Absence of Certain Changes.  As of the date of this Agreement, since the date of the Parent Financial Statements, the Parent has conducted its business consistent with past practice; and other than in the ordinary course of business of Parent consistent with past practice, with respect to the business of Parent, there has not been any:
(a)change, event or development having, or that could be reasonably expected to have a Material Adverse Effect on Parent or the financial condition of Parent, and Parent has no Knowledge of any facts or circumstances that will likely result in or have a Material Adverse Effect on Parent or the financial condition of Parent;
(b)material change in any method of accounting or accounting practice for the business of Parent except as required by GAAP or as disclosed in the notes to the Parent Financial Statements;
(c)material change in cash management practices and policies, inventory control, prepayment of expenses, payment of trade accounts payable, accrual of other expenses, deferral of revenue and acceptance of customer deposits;
(d)transfer, assignment, sale or other disposition of any material assets of Parent shown or reflected in the Parent Financial Statements, except for the sale of inventory in the ordinary course of business;
(e)cancellation of any material debts or claims or amendment, termination or waiver of any rights which could, individually or in the aggregate, have a Material Adverse Effect on the business of the Parent;
(f)material damage, destruction or loss, or any material interruption in use, of any material portion of the assets of Parent (whether or not covered by insurance) which could, individually or in the aggregate, have a Material Adverse Effect on the business of Parent;
(g)acceleration, termination, material modification to or cancellation of any contract, agreement or permit of Parent which could, individually or in the aggregate, have a Material Adverse Effect on the business of Parent;
(h)action to accelerate the vesting or payment of any compensation or benefit for any current or former employee, officer, director, consultant or independent contractor of Parent;
(i)any loan to (or forgiveness of any loan to), or entry into any other transaction with, any current or former directors, officers, or employees of Parent;
(j)adoption of any plan of merger, consolidation, reorganization, liquidation or dissolution or filing of a petition in bankruptcy under any provisions of federal or state bankruptcy law or consent to the filing of any bankruptcy petition against Parent under any similar law;
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(k)contract or agreement entered into pursuant to which Parent is obligated to do any of the foregoing;
(l)breach or violation by Parent of, or default by Parent under, any contract or agreement to which Parent is a party or by which any of its assets or properties are bound, except for breach, violations, and defaults which, individually or in the aggregate, are not having and could not be reasonably expected to have a Material Adverse Effect on Parent.
(m)Notice by a Governmental Authority of alleged violations by Parent of Environmental Laws, or, to the Knowledge of Parent, proposal to include property now owned or previously owned, leased, or operated by Parent on the National Priorities List promulgated pursuant to CERCLA, on CERCLIS (as defined in CERCLA) or on any similar federal, state, local or foreign list of sites requiring investigation or cleanup; or
(n)Actions against Parent, or to the Knowledge of Parent threatened, to be brought or filed, by or with any governmental authority or arbitrator in connection with the employment of any current or former employee, consultant, volunteer, intern, or independent contractor of Parent, except as set forth in Schedule 3.14 of the Parent Disclosure Schedules.
3.15.Taxes.
(a)All Taxes due and owing on or before the Closing Date by or on behalf of Parent (whether or not shown on any Tax Return) have been, or will be, timely paid and all Tax Returns, required to be filed by or on behalf of Parent for any Tax period ending on or before the Closing Date have been, or will be, timely filed;
(b)All Taxes required to have been withheld and paid in connection with amounts paid or owing to any employee, independent contractor, creditor, customer, member or other party have been or will be timely withheld and paid on or before the Closing Date, and all information reporting and backup withholding provisions of applicable law have been or will be timely complied with on or before the Closing Date;
(c)No extensions or waivers of statutes of limitations have been given or requested with respect to any Taxes of or with respect to Parent;
(d)All deficiencies asserted, or assessments made, against or with respect to Parent as a result of any examinations by any taxing authority have been fully paid or are being contested in good faith;
(e)Parent (x) is not a party to any Action by any taxing authority, and (y) has no pending or threatened Actions by any taxing authority against it;
(f)there are no Liens for Taxes upon any of Parent’s assets nor, to Parent’s Knowledge, is any taxing authority in the process of imposing any Liens for Taxes on any of the Parent’s assets (other than for current Taxes not yet due and payable);
(g)Parent is not and has not been a party to or a promoter of a “reportable transaction” within the meaning of Section 6707A(c)(1) of the Code and Treasury Regulations Section 1.6011 4(b); and
(h)none of the Parent’s assets is (i) subject to Section 168(g)(1)(A) of the Code, or (ii) subject to a disqualified leaseback or long-term agreement as defined in Section 467 of the Code.
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3.16.No Inducement or Reliance; Independent Assessment.  With respect to the Assets and the transactions contemplated by this Agreement and the Transaction Documents, Parent shall only be entitled to rely on the representations, warranties and statements that are expressly set forth herein (including the Exhibits and Schedules hereto), and (in the absence of fraud) Parent will not have any right or remedy arising out of any other representation, warranty or statement.
(Collectively, the covenants, representations, warranties and statements set forth in this SECTION III are referred to as “Acquirer’s and Parent’s Representations and Warranties”).
SECTION IV.
COVENANTS
4.1.Regulatory and Other Approvals. During the Interim Period:
(a)Each Party shall attempt to obtain as promptly as practicable all material consents and approvals that either Party or its respective Affiliates are required to obtain in order to consummate the transactions contemplated hereby; provided that, for purposes of clarification, and notwithstanding anything to the contrary in this Agreement, the obtaining of the consents and approvals will not be a condition to the Closing except to the extent set forth in SECTION V or SECTION VI, as applicable.
(b)The Parties shall cooperate with each other in every way, and each Party, promptly upon the request of the other, shall do such commercially reasonable acts and shall execute and have acknowledged and delivered to the other Party, as may be appropriate, any and all further documents or instruments as may be reasonably requested or in order to consummate the transactions contemplated hereby.  Without limiting the generality of the foregoing, each Party shall (i) make or cause to be made the filings required of the Person or any of its applicable Affiliates under any Laws applicable to it with respect to the transactions contemplated by this Agreement and to pay any fees due of it in connection with the filings, as promptly as is reasonably practicable, provided that, for purposes of clarification, and notwithstanding anything to the contrary in this Agreement, the filings and payments will not be conditions to the Closing except to the extent set forth in SECTION V or SECTION VI,; (ii) use reasonable efforts to cause the expiration of the notice or waiting periods under any Laws applicable to it with respect to the consummation of the transactions contemplated by this Agreement as promptly as is reasonably practicable; (iii) promptly inform the other Party of any communication from or to, and any proposed understanding or agreement with, any Governmental Authority in respect of the filings; (iv) reasonably consult and cooperate with the other Party in connection with any analyses, appearances, presentations, memoranda, briefs, arguments, and opinions made or submitted by or on behalf of any Party in connection with all meetings, actions or other Proceedings with Governmental Authorities relating to the filings; (v) comply, as promptly as is reasonably practicable, with any requests received by the Party under any Laws for additional information, documents or other materials with respect to the filings, (vi) attempt to resolve any objections as may be asserted by any Governmental Authority with respect to the transactions contemplated by this Agreement; and (vii) contest and resist any action or other Proceeding instituted (or threatened in
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writing to be instituted) by any Governmental Authority challenging the transactions contemplated by this Agreement as violative of any Law.
(c)If a Party (or any of its applicable Affiliates) intends to participate in any meeting with any Governmental Authority with respect to the filings and if permitted by, or acceptable to, the applicable Governmental Authority, it shall give the other Party reasonable prior notice of, but in any event not less than five business days prior to such meeting (unless by the nature of the meeting such notice is impractical) and an opportunity to participate in, the meeting.
(d)In connection with any such filings, Acquirer and Parent shall cooperate in good faith with Governmental Authorities and with Acquired Corporation and undertake promptly any and all action required to lawfully complete the transactions contemplated by this Agreement.
(e)Each Party shall provide prompt notification to the other when it becomes aware that any such consent or approval referred to in this Section 4.1 is obtained, taken, made, given or denied, as applicable.
(f)In furtherance of the foregoing covenants:
		(i)
	Each Party shall prepare, or cause its Affiliates to prepare, as soon as is practicable following the execution of this Agreement, all necessary filings applicable to it and in connection with the transactions contemplated by this Agreement that may be required under any Laws; provided that, for purposes of clarification, and notwithstanding anything to the contrary in this Agreement, the filings will not be conditions to the Closing except to the extent set forth SECTION V or SECTION VI.

		(ii)
	Each Party shall promptly furnish the other Party with copies of any notices, correspondence or other written communication received by it from the relevant Governmental Authority, shall promptly make any appropriate or necessary subsequent or supplemental filings required of it, and shall cooperate in the preparation of the filings as is reasonably necessary and appropriate.

		(iii)
	 Each Party shall not, and shall cause its respective Affiliates not to, take any action that could reasonably be expected to adversely affect the approval of any Governmental Authority.

		(iv)
	 Member shall cooperate with Acquirer and Parent to promptly file such disclosures and applications with the MED, the OLCC, or the Applicable Local Licensing Authority, as required by the Marijuana Code or reasonably requested by Acquirer or Parent.

4.2.Access of Acquirer and Parent; Due Diligence. During the Interim Period, Acquired Corporation shall provide Acquirer and Parent with reasonable access, upon reasonable notice and during normal business hours, to the Business and the Leased Premises, subject to the Marijuana
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Code. During the Interim Period, each Party shall provide each other Party, upon request, with access to its books and records, standard operating procedures, and with reasonable access to its employees in order to allow for appropriate due diligence.
4.3.Certain Restrictions. During the Interim Period, except as permitted or required by the other terms of this Agreement, or consented to in writing by Acquirer and Parent, Acquired Corporation shall not take any of the following actions:
(a)Sell, lease, transfer, pledge or otherwise dispose of any of the Assets or place any Liens or encumbrances thereon;
(b)Fail to maintain in full force and effect any of the Licenses;
(c)Fail to perform obligations under any Contracts;
(d)Increase the salary or compensation or benefits of any employee or contractor, except in the ordinary course consistent with past practice, and provided Acquired Corporation delivers written notice to Acquirer and Parent of same;
(e)Incur any liabilities of Acquired Corporation other than in the ordinary course of business.
(f)Make capital expenditures in excess of $10,000;
(g)Invest in or make any loans to any person or entity in excess of $10,000;
(h)Dissolve Acquired Corporation or file or declare bankruptcy, insolvency or similar action;
(i)Sell the Business or any Assets outside of the ordinary course of business;
(j)Enter into or materially amend any material Contract, lease or other arrangement; or
(k)Enter into any agreement, commitment or understanding, whether in writing or not, to take any of the above actions.
4.4.Updating. From time to time prior to the Closing, Acquired Corporation may, at its option, supplement or amend and deliver updates to Acquirer and Parent as necessary to complete or correct any information in this Agreement or Acquired Corporation’s representations and warranties; provided that any such supplement, amendment or update may only be made as to circumstances occurring after the date hereof.
4.5.Further Assurances. Subject to the terms and conditions of this Agreement, at any time or from time to time after the Closing, at a Party’s request and without further consideration, the other Party shall execute and deliver to the requesting Party such other instruments of sale, transfer, conveyance, assignment and confirmation, provide such materials and information and take such other actions as the Party may reasonably request in order to consummate the transactions contemplated by this Agreement.
4.6.Acquirer’s and Parent’s Obligations if No Closing. If the Closing, or in the case of multiple Closings as contemplated in Exhibit A, a single Closing, does not occur by reason of Acquirer’s or Parent’s default for any reason or if Acquirer and Parent terminate this Agreement after Final Governmental Approval, Acquirer and Parent shall cooperate with Acquired
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Corporation by executing all documents reasonably necessary to void the Change of Ownership with respect only to those Assets that have not been transferred as a result of such default or termination; it being understood and agreed by the Parties that no such Change of Ownership shall occur for Assets already transferred pursuant to a Closing.
4.7.Application Fees. Acquirer shall pay the change of ownership application fees and prorated annual license renewal fees for all state and local licenses.
4.8.Non-Competition; Non-Solicitation.
(a)The “Restricted Period” begins on the Closing Date and ends on the later of (i) the second anniversary of the Closing Date or (ii) two years following the termination of employment of Member from Acquirer or Parent for any reason.
(b)“Competing Business” means any business, except for the Business explicitly related to the Assets, engaged in the cultivation, manufacture and sale of marijuana or marijuana-related products, and/or dispensaries in respect thereof.
(c)During the Restricted Period, Acquired Corporation and its Affiliates shall not
(i)engage in, invest in, or otherwise participate in, directly or indirectly, any Competing Business unless agreed to in writing by the Parties; or
(ii)employ, retain, engage or solicit the employment or engagement of services of any employee of Acquirer or Parent, the Business or any of Acquirer’s or Parent’s Affiliates on a full- or part-time basis.
(d)During the Restricted Period, Acquired Corporation and its Affiliates shall not solicit customers of the Business in connection with a Competing Business.
(e)Notwithstanding anything to the contrary set forth in this Section 4.8, Acquirer and Parent hereby agree that the covenants set forth in this Section 4.8 shall not be breached (or be deemed breached) by Acquired Corporation or any of its Affiliates as a result of the ownership by Acquired Corporation or any of its Affiliates of less than an aggregate of 5% of any class of stock of a Competing Business provided that such stock is listed on a national securities exchange or is quoted on the OTC Market.
(f)Any violation of this Section 4.8 may result in irreparable injury to Acquirer, Parent and the Business and Acquirer and/or Parent will be entitled to seek an injunction against Acquired Corporation and its Affiliates from any court having jurisdiction over the matter, restraining any further violation of this Section 4.8, which rights shall be cumulative and in addition to any other rights or remedies to which Acquirer or Parent may be entitled. Each of Acquired Corporation and its Affiliates acknowledges that it has carefully read this Agreement and has given careful consideration to the restraints imposed upon Acquired Corporation by this Section 4.8, and is in full accord as to their necessity for the reasonable and proper protection of the legitimate business interests relating to the Business and Acquirer’s and Parent’s business now existing and to be developed in the future. Each of Acquired Corporation and its Affiliates expressly acknowledges and agrees that each and every restraint imposed by this Section 4.8 is reasonable with respect to subject matter, time period and geographical area.
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(g)If any covenant set forth in this Section 4.8 is adjudicated to exceed the time, geographic, product or service or other limitations permitted by applicable law in any jurisdiction, then any court is expressly empowered to reform such covenant, and such covenant will be deemed reformed, in such jurisdiction to the maximum time, geographic, product or service or other limitations permitted by the applicable Law. The covenants contained in this Section 4.8 and each provision thereof are severable and distinct covenants and provisions. The invalidity or unenforceability of any such covenant or provision as written will not invalidate or render unenforceable the remaining covenants or provisions hereof, and any such invalidity or unenforceability in any jurisdiction will not invalidate or render unenforceable such covenant or provision in any other jurisdiction. To the extent the provisions of this Section 4.8  conflict with the provisions of Section 9.12, the provisions of this Section 4.8 will control.
(h)Acquired Corporation shall cause its Affiliates to comply with the obligations set forth in this Section 4.8.
4.9.Post-Closing Covenants Concerning Disposition of Assets.  Neither Acquirer nor Parent shall sell or otherwise dispose of any Asset, if such sale or disposition would result in the transactions contemplated herein not qualifying as a reorganization under the Section 368 of the Code.
4.10.Non-Assumption of Liabilities.  Upon the sale and purchase of the Assets, neither Acquirer nor Parent shall assume nor agree to pay or discharge when due any debt, obligation, responsibility, claim or liability of Acquired Corporation or Member, whether known or unknown, contingent or absolute, which shall include, but not be limited to: (i) all liabilities, obligations, contracts and commitments arising out of the ownership and operation of the Business; (ii) any obligation or liability related to any present or former officer, director, shareholder, employee or agent of Acquired Corporation or Member or any person or entity controlled or under common control with any such person; (iii) any obligation or liability of any kind arising out of noncompliance with any federal, state or local Laws; (iv) any indebtedness for borrowed money or any guarantee of Acquired Corporation; (v) any amounts due any shareholder of Acquired Corporation or Member or any Affiliate thereof; (vi) any liability relating to pension, profit-sharing, worker’s compensation or other employee benefit plan or policy; (vii) any Taxes; or (viii) any liability resulting from injury to persons or property (collectively, “Excluded Liabilities”).
SECTION V.
ACQUIRER’S CONDITIONS TO CLOSING
The obligation of Acquirer to consummate the Closing with regard to any specific Asset or group of Assets is subject to the fulfillment of each of the following conditions (except to the extent waived in writing by Acquirer in its sole discretion):
5.1.Representations and Warranties.
(a)Acquired Corporation’s Representations and Warranties will be true and correct on and as of the Closing as though made on and as of the Closing (other than those Representations and Warranties that speak to an earlier date); and
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(b)in the case of Acquired Corporation’s Representations and Warranties that speak to an earlier date, such Representations and Warranties will be true and correct as of the earlier date.
5.2.Performance. Acquired Corporation has performed and complied in all material respects with the agreements, covenants, and obligations required by this Agreement to be performed or complied with by Acquired Corporation at or before the Closing.
5.3.Acquired Corporation’s Deliverables. Acquired Corporation has delivered to Acquirer at the Closing Acquired Corporation’s Closing Documents.
5.4.Orders and Laws. There is no Law or order (except for any such order issued in connection with a Proceeding instituted by Acquirer or Parent or their respective Affiliates) restraining, enjoining or otherwise prohibiting or making illegal the consummation of the transactions contemplated by this Agreement or the operation of the Business.
5.5.Consents and Approvals. All terminations or expirations of waiting periods imposed by any Governmental Authority with respect to this Agreement have occurred; provided, however, that the absence of any appeals and the expiration of any appeal period with respect to any of the foregoing will not constitute a condition to the Closing hereunder.
5.6.No Material Adverse Effect. No Material Adverse Effect with respect to Acquired Corporation exists or is likely to exist as determined in the reasonable discretion of Acquirer.
5.7.Final Governmental Approval. Final Governmental Approval shall have occurred regarding the Change of Ownership of the Assets proposed for Closing.
5.8.Acquirer’s Diligence. Acquirer and Parent will have conducted any and all due diligence, including without limitation, an appraisal of the Assets, the results of which will be satisfactory to Acquirer, Parent and their respective financing sources in their sole discretion.
5.9.Lease. The landlord for the Leased Premises applicable to the Assets proposed for Closing will have agreed in writing to a new lease for such Leased Premises with Acquirer as tenant, in form and substance acceptable to Acquirer in Acquirer’s sole discretion.
SECTION VI.
ACQUIRED CORPORATION’S CONDITIONS TO CLOSING
The obligation of Acquired Corporation to consummate the Closing is subject to the fulfillment of each of the following conditions (except to the extent waived in writing by Acquired Corporation in its sole discretion):
6.1. Representations and Warranties.
(a)Acquirer’s and Parent’s Representations and Warranties will be true and correct on and as of the Closing as though made on and as of the Closing (other than those Representations and Warranties that speak to an earlier date); and
(b)in the case of those Representations and Warranties that speak as to an earlier date, such Representations and Warranties will be true and correct as of the earlier date.
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6.2.Performance. Acquirer and Parent will have performed and complied in all material respects with the agreements, covenants and obligations required by this Agreement to be so performed or complied with by Acquirer and/or Parent at or before the Closing.
6.3.Acquirer’s Deliverables. Acquirer will have delivered to Acquired Corporation the Purchase Price, the Acquirer’s Officer’s Certificate, the Opinion Letter, and resolutions of the Board of Directors of Acquirer authorizing this Agreement and the transactions contemplated hereby.
6.4.No Parent Material Adverse Effect. No Parent Material Adverse Effect exists.
6.5.Orders and Laws. There is no Law or order (except for any such order issued in connection with a Proceeding instituted by Acquired Corporation or its Affiliates) restraining, enjoining or otherwise prohibiting or making illegal the consummation of the transactions contemplated by this Agreement.
6.6.Consents and Approvals. All terminations or expirations of waiting periods imposed by any Governmental Authority with respect to this Agreement will have occurred; provided, however, that the absence of any appeals and the expiration of any appeal period with respect to any of the foregoing will not constitute a condition to the Closing hereunder.
6.7.Final Governmental Approval. Final Governmental Approval shall have occurred.
SECTION VII.
TERMINATION
7.1.Termination. This Agreement may be terminated in one or more of the following ways:
(a)At any time before the Closing, by Acquired Corporation, on the one hand, or Acquirer and Parent, on the other hand, by written notice to the other, if any Law or final order of a Governmental Authority restrains, enjoins or otherwise prohibits or makes illegal the sale of the Assets pursuant to this Agreement.
(b)At any time before the Closing, by Acquirer and Parent, by written notice to Acquired Corporation, if Acquired Corporation has materially breached Acquired Corporation’s Representations and Warranties or obligations under this Agreement and the breach would or does result in the failure of any condition set forth in SECTION VI.
(c)At any time before the Closing, by Acquired Corporation, by written notice to Acquirer and Parent if Acquirer and/or Parent has materially breached Acquirer’s and Parent’s Representations and Warranties or obligations under this Agreement and the breach would or does result in the failure of any condition set forth in SECTION VI.
(d)At any time before the Closing, by Acquirer and Parent, by written notice to Acquired Corporation, if Acquirer and Parent have discovered any fact, circumstance, or condition which would render any of Acquired Corporation’s Representations and Warranties false, or create a Material Adverse Effect upon any of the Assets, in Acquirer’s and Parent’s reasonable discretion.
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(e)At any time before Closing, by Acquired Corporation, by written notice to Acquirer and Parent, if Acquired Corporation has discovered any fact, circumstance, or condition which would render any of Acquirer’s and Parent’s Representations and Warranties false, or create an Acquirer Material Adverse Effect, in Acquired Corporation’s reasonable discretion.
7.2.Effect of Valid Termination. If this Agreement is validly terminated pursuant to this Section 7.2, there will be no liability or obligation hereunder on the part of either Party or any of their respective Affiliates, except for
(a)obligations of confidentiality and non-use with respect to the other Party’s confidential information, and
(b)Liabilities relating to any breach by any Party of any representation, warranty, covenant or agreement set forth herein.  Notwithstanding the foregoing, Section I, Section VIII, and Section IX will survive any such termination.
SECTION VIII.
LIMITATIONS ON LIABILITY, THIRD-PARTY CLAIMS, AND ARBITRATION
8.1.Indemnity. From and after the Closing:
(a)Acquired Corporation and Member shall, jointly and severally, indemnify, defend, and hold harmless Acquirer and Parent from and against all Losses incurred or suffered by Acquirer and/or Parent resulting from:
(i)any breach as of the Closing (as though made on and as of the Closing except to the extent a representation or warranty is expressly made as of an earlier date, in which case only as of the earlier date) of Acquired Corporation’s Representations and Warranties; and
(ii)any breach of any covenant or agreement of Acquired Corporation contained in this Agreement.
(iii)any Tax liability whatsoever of Acquired Corporation or any Affiliates.
(iv)any Excluded Liabilities.
(b)Acquirer and Parent shall, jointly and severally, indemnify, defend, and hold Acquired Corporation and Member harmless from and against all Losses incurred or suffered by Acquired Corporation or Member resulting from:
(i)any breach as of the Closing (as though made on and as of the Closing Date except to the extent a representation or warranty is expressly made as of an earlier date, in which case only as of the earlier date) of Acquirer’s and Parent’s Representations and Warranties; and
(ii)any breach of any covenant or agreement of Acquirer and/or Parent contained in this Agreement.
(c)If Acquirer and/or Parent suffers any Loss, for which Acquired Corporation and Member are obligated to indemnify Acquirer and Parent pursuant to Section 8.1(a)
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above, Acquirer and Parent may, at their sole option, either (i) set-off any and all such Losses against any cash consideration then owed to Acquired Corporation pursuant to Section 1.2(b) of Exhibit A; or (ii) redeem certain Parent Shares from Acquired Corporation or Member, as follows:
(i)Acquirer and Parent will deliver written notice (“Set-Off Notice”) to Acquired Corporation and Member of (a) the nature of; (b) the amount of; (c) the date of the Loss for which Acquirer and Parent are entitled to indemnification, along with the amount to be set off, or alternatively, the number of Parent Shares required to compensate Acquirer and Parent for such Loss, calculated at the average daily price for Parent’s common stock on the date of the Loss identified in such the Set-Off Notice (the “Redemption Shares”).
(ii)Acquired Corporation and Member shall have a period of fifteen (15) calendar days from the date of the Set-Off Notice to dispute any matter contained in the Set-Off Notice (“Dispute Period”), by delivering written notice to Acquirer and Parent stating the nature of its dispute before the expiration of the Dispute Period (“Dispute Notice”).  In such event, the Parties shall covenant and agree to use their respective commercially reasonable efforts to resolve such dispute as soon as reasonably practicable, but in no event later than 30 days from the date of the Dispute Notice.
(iii)If Acquired Corporation and/or Member does not deliver a Dispute Notice, Acquirer and Parent shall have the right to proceed with the cash set-off or redemption as set forth in subparagraph (iv) below upon the expiration of the Dispute Period; alternatively, in the event Acquired Corporation and/or Member delivers a Dispute Notice and the Parties are unable to agree on a resolution within the aforementioned 30-day period, Acquirer and Parent shall have the right to proceed with the cash set-off or redemption as set forth in subparagraph (iv) below upon the expiration of such 30-day period.
(iv)Subject to subparagraphs (i) – (iii) above, Acquirer and Parent shall be entitled to effectuate the cash set-off or, in the event Parent elects to redeem shares, Parent shall redeem the Redemption Shares, and Acquired Corporation and Member shall allow Parent to redeem such Redemption Shares, for the aggregate price of one dollar.
8.2.Limitations of Liability. Notwithstanding anything in this Agreement to the contrary:
(a)Acquired Corporation’s Representations and Warranties and Acquirer’s and Parent’s Representations and Warranties will survive the Closing for so long as the appropriate statute of limitations in respect thereof is applicable.
(b)Acquirer and Parent shall give written notice to Acquired Corporation and Member within a reasonable period of time after becoming aware of any breach by Acquired Corporation of any representation or warranty, covenant, agreement, or
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obligation in this Agreement, but in any event no later than 30 days after becoming aware of such breach.
(c)Acquired Corporation shall give written notice to Acquirer and Parent within a reasonable period of time after becoming aware of any breach by Acquirer and/or of any representation or warranty, covenant, agreement or obligation in this Agreement, but in any event no later than 30 days after becoming aware of such breach.
(d)the Parties have a duty to reasonably mitigate any Loss in connection with this Agreement.
(e)Acquired Corporation’s and Member’s liability with respect to Section 8.1 is limited to Losses incurred or suffered by Acquirer and/or Parent in an amount not to exceed the Purchase Price; provided, however, that with respect to breaches by Acquired Corporation of Sections 2.5 (Broker), Section 2.7 (Taxes) or Section 2.11 (Environmental Matters), Acquired Corporation’s liability in respect thereof shall be unlimited.
(f)Acquirer’s and Parent’s aggregate liability with respect to Section 8.1 is limited to Losses incurred or suffered by Acquired Corporation in an amount not exceeding the Purchase Price.
8.3.Procedure with Respect to Third-Party Claims.
(a)If a Party is threatened with or becomes subject to a third party Claim, and such Party (the “Claiming Party”) believes it has a claim entitled to indemnification from the other Party (the “Responding Party”) as provided in Section 8.1 as a result, then the Claiming Party shall notify the Responding Party in writing of the basis for the Claim setting forth the nature of the Claim in reasonable detail. The failure of the Claiming Party to so notify the Responding Party will not relieve the Responding Party of liability hereunder except to the extent that the defense of the Claim is prejudiced by the failure to give the notice.
(b)If any Proceeding is brought by a third party against a Claiming Party and the Claiming Party gives notice to the Responding Party pursuant to this Section 8.3(a), the Responding Party may participate in the Proceeding and, to the extent that it wishes, to assume the defense of the Proceeding, if (i) the Responding Party provides written notice to the Claiming Party that the Responding Party intends to undertake the defense, (ii) the Responding Party conducts the defense of the third-party Claim actively and diligently with counsel reasonably satisfactory to the Claiming Party, and (iii) if the Responding Party is a party to the Proceeding, the Responding Party or the Claiming Party has not determined in good faith that joint representation would be inappropriate because of a conflict of interest. The Claiming Party may, in its sole discretion, employ separate counsel (who may be selected by the Claiming Party in its sole discretion) in any such action and to participate in the defense thereof, and the Claiming Party shall pay the fees and expenses of its counsel. The Claiming Party shall cooperate with the Responding Party and its counsel in the defense or compromise of the Claim. If the Responding Party assumes the defense of a Proceeding, no compromise or settlement of the Claims may be effected by the Responding Party without the Claiming Party’s consent unless (x) there is no finding or admission of any violation of Law or any violation of the rights of any Person and no effect on any other
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Claims that may be made against the Claiming Party, and (y) the sole relief provided is monetary damages that the Responding Party pays in full.
(c)If notice is given to the Responding Party of the commencement of any third-party Proceeding and the Responding Party does not, within 14 days after the Claiming Party’s notice is given pursuant to this Section 8.3(a), give notice to the Claiming Party of its election to assume the defense of the Proceeding, any of the conditions set forth in clauses (i) through (iii) of Section 8.3(b) above become unsatisfied or a Claiming Party determines in good faith that there is a reasonable probability that a Proceeding may adversely affect it other than as a result of monetary damages for which it would be entitled to indemnification from the Responding Party under this Agreement, then the Claiming Party may (upon notice to the Responding Party) undertake the defense, compromise or settlement of the Claim; provided, however, that the Responding Party shall reimburse the Claiming Party for the Losses associated with defending against the third-party Claim (including reasonable attorneys’ fees and expenses) and will remain otherwise responsible for any liability with respect to amounts arising from or related to the third-party Claim, in both cases to the extent it is ultimately determined that the Responding Party is liable with respect to the third-party Claim for a breach under this Agreement. The Responding Party may elect to participate in the Proceedings, negotiations or defense at any time at its own expense.
8.4.Mandatory Binding Arbitration.
(a)Except for Claims arising under Section 4.8 or Section 9.11, any dispute, Claim, interpretation, controversy, or issues of public policy arising out of or relating to this Agreement, including the determination of the scope or applicability of this Section 8.4, will be determined exclusively by arbitration held in Denver, Colorado, and will be governed exclusively by the Colorado Revised Arbitration Act, §§ 13-22-201, et seq., C.R.S. (the “CRAA”).
(b)The arbitrator will be selected from the roster of arbitrators at Judicial Arbiter Group, Inc. in Denver, Colorado (“JAG”), unless the Parties agree otherwise. If the Parties do not agree on the selection of a single arbitrator within ten days after a demand for arbitration is made, then the arbitrator will be selected by JAG from among its available professionals. Arbitration of all disputes and the outcome of the arbitration will remain confidential between the Parties except as necessary to obtain a court judgment on the award or other relief or to engage in collection of the judgment.
(c)The Parties irrevocably submit to the exclusive jurisdiction of the state courts located in Denver, Colorado, with respect to this Section 8.4 to compel arbitration, to confirm an arbitration award or order, or to handle court functions permitted under the CRAA. The Parties irrevocably waive defense of an inconvenient forum to the maintenance of any such action or other proceeding. The Parties may seek recognition and enforcement of any Colorado state court judgment confirming an arbitration award or order in any United States state court or any court outside the United States or its territories having jurisdiction with respect to recognition or enforcement of such judgment.
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(d)The Parties waive (i) any right of removal to the United States federal courts and (ii) any right in the United States federal courts to compel arbitration, to confirm any arbitration award or order, or to seek any aid or assistance of any kind.
SECTION IX.
MISCELLANEOUS
9.1.No Third-Party Beneficiaries. The terms and provisions of this Agreement are intended solely for the benefit of the Parties and their respective successors or permitted assigns, and it is not the intention of the Parties to confer third-party beneficiary rights upon any other Person.
9.2.Entire Agreement. This Agreement supersedes all prior discussions and agreements between the Parties and/or their Affiliates with respect to the subject matter hereof and contains the sole and entire agreement between the Parties and their Affiliates with respect to the subject matter hereof.
9.3.Waiver. Any term or condition of this Agreement may be waived at any time by the Party that is entitled to the benefit thereof, but no such waiver will be effective unless set forth in a written instrument duly executed by or on behalf of the Party waiving the term or condition. No waiver by a Party of any term or condition of this Agreement, in any one or more instances, will be deemed to be or construed as a waiver of the same or any other term or condition of this Agreement on any future occasion. All remedies, either under this Agreement or by Law, are cumulative and not alternative.
9.4.Succession and Assignment. This Agreement is binding upon and will inure to the benefit of the Parties and their successors and assigns. Acquirer and Parent may assign their rights, interests and obligations hereunder. Acquired Corporation may not assign this Agreement or any of its rights, interests, or obligations hereunder.
9.5.Counterparts; Electronic or Fax Signatures. This Agreement may be executed in counterparts, each of which will be an original and all of which, when taken together, will constitute one instrument notwithstanding that all parties have not executed the same counterpart. Signatures that are transmitted electronically or by fax will be effective as originals.
9.6.Headings. The headings used in this Agreement have been inserted for convenience of reference only and do not modify, define, or limit any of its terms or provisions.
9.7.Notices. Any notice, request, demand, Claim, or other communication hereunder will be in writing and will be deemed delivered: (a) three Business Days after it is sent by U.S. mail, certified mail, return receipt requested, postage prepaid; or (b) one Business Day after it is sent via a reputable nationwide overnight courier or sent via email, in each of the foregoing cases to the intended recipient as set forth below:
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	If to Acquirer or Parent:
	    
	Trees Corporation
1901 S Navajo St.
Denver, CO 80223
Attn: David R. Fishkin
dfishkin@treescann.com

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	​

	​

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	With a copy to:
	    
	Hassan Cables
1035 Pearl Street, Suite 200
Boulder, CO 80302
Attn: David Wunderlich
david@hassancables.com

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	If to Acquired Corporation or Member:
	    
	Timothy Brown
1901 S Navajo St.
Denver, CO 80223
Email: tim@trees.menu
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Any Party may give any notice, request, demand, Claim, or other communication hereunder by personal delivery, electronically, or fax, but no such notice, request, demand, Claim, or other communication will be deemed to have been duly given unless and until it is actually received by the Party for whom it is intended. A Party may change the address to which notices, requests, demands, Claims, and other communications hereunder are to be delivered by giving notice to the other Party in the manner herein set forth.
9.8.Governing Law. This Agreement is governed by and construed and enforced in accordance with the Laws of the State of Colorado, without giving effect to any conflict or choice of law provision that would result in imposition of another state’s Law. THE PARTIES ACKNOWLEDGE THAT (A) COLORADO HAS PASSED AMENDMENTS TO THE COLORADO CONSTITUTION AND ENACTED CERTAIN LEGISLATION TO GOVERN THE MARIJUANA INDUSTRY AND (B) THE POSSESSION, SALE, MANUFACTURE, AND CULTIVATION OF MARIJUANA IS ILLEGAL UNDER FEDERAL LAW. THE PARTIES WAIVE ANY DEFENSES BASED UPON INVALIDITY OF CONTRACTS FOR PUBLIC POLICY REASONS AND/OR THE SUBSTANCE OF THE CONTRACT VIOLATING FEDERAL LAW.
9.9.Waiver of Right to Trial by Jury. EACH PARTY IRREVOCABLY AND UNCONDITIONALLY WAIVES TO THE FULLEST EXTENT PERMITTED BYLAW TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING RELATING TO THIS AGREEMENT AND WITH RESPECT TO ANY COUNTERCLAIM THEREIN.
9.10.Attorneys’ Fees. If either Party brings a Proceeding to enforce the provisions of this Agreement, the substantially prevailing Party will be entitled to recover its reasonable attorneys’ fees and expenses incurred in such action from the non-prevailing Party as determined by the arbitrator or a court of law.
9.11.Specific Performance. The Parties acknowledge the rights of each Party to consummate the transactions contemplated hereby (including the satisfaction of any condition to the Closing) are special, unique, and of extraordinary character, and if either Party violates or fails
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or refuses to perform any covenant or agreement made by it herein, the other Party may be without an adequate remedy at law. If either Party violates or fails or refuses to perform any covenant or agreement made by them herein, the other Party may (at any time prior to the earlier of a) valid termination of this Agreement pursuant to Section VII and b) the Closing), subject to the terms hereof, institute and prosecute an action to enforce specific performance of the covenant or agreement. The Parties irrevocably submit to the exclusive jurisdiction of the state courts located in Denver, Colorado, with respect to this Section 9.11. The Parties irrevocably waive defense of an inconvenient forum to the maintenance of any such action or other proceeding with respect to this Section 9.11.
9.12.Invalid Provisions. If a dispute between the Parties arises out of this Agreement or the subject matter of this Agreement, the Parties would want a court or arbitrator to interpret this Agreement as follows:
(a)With respect to any provision held to be unenforceable, by modifying that provision to the minimum extent necessary to make it enforceable or, if that modification is not permitted by law or public policy, by disregarding the provision;
(b)if an unenforceable provision is modified or disregarded in accordance with this Section 9.12, by holding the rest of the Agreement will remain in effect as written;
(c)by holding that any unenforceable provision will remain as written in any circumstances other than those in which the provision is held to be unenforceable; and
(d)if modifying or disregarding the unenforceable provision would result in a failure of an essential purpose of this Agreement, by holding the entire Agreement unenforceable.
Upon the determination that any term or other provision of this Agreement is invalid, illegal or incapable of being enforced, the Parties shall negotiate in good faith to modify this Agreement so as to affect the original intent of the Parties as closely as possible in an acceptable manner to the end that the transactions contemplated hereby are fulfilled to the extent possible.
9.13.Expenses. Except as otherwise provided in this Agreement, whether or not the transactions contemplated hereby are consummated, each Party shall pay its own costs and expenses incurred in anticipation of, relating to and in connection with the negotiation and execution of this Agreement and the transactions contemplated hereby.
9.14.Amendments. The Parties may amend any provision of this Agreement only by a written instrument signed by the Parties.
9.15.Confidentiality and Publicity. This Agreement is confidential and will not be disclosed to any third party (other than the Parties’ Affiliates, attorneys, accountants, auditors, or other advisors, or Governmental Authorities) except as required for Tax purposes or as required by Law. A Party receiving a request for this Agreement shall promptly notify the other Party to afford it the opportunity to object or seek a protective order regarding this Agreement or information contained herein. Acquired Corporation may issue a press release or public announcement, and make any required public filings, concerning any of the transactions contemplated by this Agreement.
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9.16.Advice of Counsel. Each Party has had the opportunity to seek the advice of independent legal counsel and has read and understood each of the terms and provisions of this Agreement.
9.17.Incorporation of Recitals.  The Recitals to this Agreement are true and accurate and are incorporated into, and shall constitute a part of, this Agreement.
9.18.MED/OLCC Reformation. This Agreement and the transactions contemplated hereby are subject to review by the MED, the OLCC and any Applicable Local Licensing Authority. If the MED, the OLCC or an Applicable Local Licensing Authority determines that this Agreement must be reformed, the Parties shall negotiate in good faith to so reform this Agreement according to such Governmental Authority’s requirements while effectuating the original intent of this Agreement as near as possible.
9.18FEDERAL CANNABIS LAWS.  THIS AGREEMENT IS SUBJECT TO STRICT REQUIREMENTS FOR ONGOING REGULATORY COMPLIANCE BY THE PARTIES HERETO, INCLUDING, WITHOUT LIMITATION, REQUIREMENTS THAT THE PARTIES TAKE NO ACTION IN VIOLATION OF LOCAL OR STATE LAW REGARDING THE REGULATION OR ENFORCEMENT OF STATE-COMPLIANT CANNABIS OPERATIONS (TOGETHER WITH ALL RELATED RULES AND REGULATIONS THEREUNDER, AND ANY SUCCESSOR, THE “ACT”) OR THE GUIDANCE OR INSTRUCTION OF ANY APPLICABLE STATE REGULATORY BODY (INCLUDING ANY SUCCESSOR OR REGULATORY BODY WITH OVERLAPPING JURISDICTION, THE “REGULATOR”).
THE PARTIES HERETO AGREE AND ACKNOWLEDGE THAT NO PARTY MAKES, WILL MAKE, OR SHALL BE DEEMED TO MAKE OR HAVE MADE ANY REPRESENTATION OR WARRANTY OF ANY KIND REGARDING THE COMPLIANCE OF THIS AGREEMENT WITH ANY FEDERAL CANNABIS LAWS.  NO PARTY HERETO SHALL HAVE ANY RIGHT OF RESCISSION OR AMENDMENT ARISING OUT OF OR RELATING TO ANY NON-COMPLIANCE WITH FEDERAL CANNABIS LAWS UNLESS SUCH NON-COMPLIANCE ALSO CONSTITUTES A VIOLATION OF APPLICABLE STATE LAW AS DETERMINED IN ACCORDANCE WITH THE ACT OR BY THE REGULATOR, AND NO PARTY SHALL SEEK TO ENFORCE THE PROVISIONS HEREOF IN FEDERAL COURT UNLESS AND UNTIL THE PARTIES HAVE REASONABLY DETERMINED THAT THE ACT IS FULLY COMPLIANT WITH FEDERAL CANNABIS LAWS.  AS USED HEREIN, “FEDERAL CANNABIS LAWS” MEANS ANY U.S. FEDERAL LAWS, CIVIL, CRIMINAL OR OTHERWISE, AS SUCH RELATE, EITHER DIRECTLY OR INDIRECTLY, TO THE CULTIVATION, HARVESTING, PRODUCTION, DISTRIBUTION, SALE AND POSSESSION OF CANNABIS, MARIJUANA OR RELATED SUBSTANCES OR PRODUCTS CONTAINING OR RELATING TO THE SAME, INCLUDING, WITHOUT LIMITATION, THE PROHIBITION ON DRUG TRAFFICKING UNDER 21 U.S.C. § 841(A), ET SEQ., THE CONSPIRACY STATUTE UNDER 18 U.S.C. § 846, THE BAR AGAINST AIDING AND ABETTING THE CONDUCT OF AN OFFENSE UNDER 18 U.S.C. § 2, THE BAR AGAINST MISPRISION OF A FELONY (CONCEALING ANOTHER’S FELONIOUS CONDUCT) UNDER 18 U.S.C. § 4, THE BAR AGAINST BEING AN ACCESSORY AFTER THE FACT TO CRIMINAL CONDUCT UNDER 18 U.S.C. § 3, AND FEDERAL MONEY LAUNDERING
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STATUTES UNDER 18 U.S.C. §§ 1956, 1957, AND 1960 AND THE REGULATIONS AND RULES PROMULGATED UNDER ANY OF THE FOREGOING.
THE PARTIES ACKNOWLEDGE AND UNDERSTAND THAT THE ACT AND/OR THE REQUIREMENTS OF THE REGULATOR ARE SUBJECT TO CHANGE AND ARE EVOLVING AS THE MARKETPLACE FOR STATE-COMPLIANT CANNABIS BUSINESSES CONTINUES TO EVOLVE. IF NECESSARY OR DESIRABLE TO COMPLY WITH THE REQUIREMENTS OF THE ACT AND/OR THE REGULATOR, THE PARTIES HEREBY AGREE TO (AND TO CAUSE THEIR RESPECTIVE AFFILIATES AND RELATED PARTIES AND REPRESENTATIVES TO) USE THEIR RESPECTIVE COMMERCIALLY REASONABLE EFFORTS TO TAKE ALL ACTIONS REASONABLY REQUESTED TO ENSURE COMPLIANCE WITH THE ACT AND/OR THE REGULATOR, INCLUDING, WITHOUT LIMITATION, NEGOTIATING IN GOOD FAITH TO AMEND, RESTATE, AMEND AND RESTATE, SUPPLEMENT, OR OTHERWISE MODIFY THIS AGREEMENT TO REFLECT TERMS THAT MOST CLOSELY APPROXIMATE THE PARTIES’ ORIGINAL INTENTIONS BUT ARE RESPONSIVE TO AND COMPLIANT WITH THE REQUIREMENTS OF THE ACT AND/OR THE REGULATOR.  IN FURTHERANCE, NOT LIMITATION OF THE FOREGOING, THE PARTIES FURTHER AGREE TO COOPERATE WITH THE REGULATOR TO PROMPTLY RESPOND TO ANY INFORMATIONAL REQUESTS, SUPPLEMENTAL DISCLOSURE REQUIREMENTS, OR OTHER CORRESPONDENCE FROM THE REGULATOR AND, TO THE EXTENT PERMITTED BY THE REGULATOR, KEEP ALL OTHER PARTIES HERETO FULLY AND PROMPTLY INFORMED AS TO ANY SUCH REQUESTS, REQUIREMENTS, OR CORRESPONDENCE.
[Signature page follows immediately]
​

32

IN WITNESS WHEREOF, this Agreement has been duly executed and delivered by the Parties as of the date first above written.
TREES CORPORATION
	By: 
	​
	​

	
	​
	Name:
	Adam Hershey

	​
	Title:
	Interim Chief Executive Officer

​
	​

	​

	​

	​

	​

	TREES COLORADO LLC
	STATION 2 LLC

	By: 
	​
	By:
	​

	​
	​
	​
	​

	​
	Name:
	Adam Hershey
	Name:
	Timothy Brown

	​
	Title:
	Interim Chief Executive Officer
	Title:
	Managing Member

​
TIMOTHY BROWN
	​

	​

	​
	​

​
​

33

EXHIBIT A
CASH CONSIDERATION
	1.1
	The Purchase Price is an amount equal to $641,454.27, payable as follows:

		a.
	Cash at Closing of $256,581.71; and

		b.
	An amount equal to $16,036.36 per month for each of the twenty-four (24) months commencing on the first full calendar month following the Closing, for a total of $384,872.56.

CLOSING
	2.1
	At the Closing, Acquired Corporation will retain any uncollected accounts receivable and all cash and funds in depository accounts. Acquired Corporation will be responsible for satisfying all accounts payable after the Closing Date.  Acquired Corporation shall take any and all actions necessary or appropriate to transfer to, and vest control in all such accounts with, Acquirer.

	2.2
	The closing for the purchase and sale of the Assets (the “Closing”) will be held within five Business Days of Final Governmental Approval of all Changes of Ownership contemplated under this Agreement, except as provided in Section 2.2 (the “Closing Date”). The Closing will be at a time and place agreed to by the Parties unless the Parties agree that the Closing need not occur at a specific location.

	2.3
	If Final Governmental Approval is granted by MED or OLCC as to any particular Asset before Final Governmental Approval is granted as to the remaining Assets, the Parties may effectuate multiple Closings, each of which shall transfer only those Assets for which Final Governmental Approval has been so granted, and upon each such Closing, Purchase Price shall be paid by Acquirer only in respect of such Assets (in accordance with the allocation schedule set forth above) for which Final Governmental Approval has been granted. The Parties may, by mutual agreement, schedule or postpone the Closing Date or any particular Closing in order to effect all the Closings simultaneously, to the extent permissible by the Marijuana Code.

​

34

EXHIBIT B
​
ASSETS
​
Substantially all of the assets of each Acquired Corporation, including without limitation:
		●	All Licenses.

		●	All stores/dispensaries.

		●	Any machinery and equipment.

		●	All right, title and interest in and to, and/or assignment of, any contracts to which Acquired Corporation or any affiliate is party thereto.

		●	Any and all leasehold interests and real property interests.

		●	Any and all inventory.

		●	Any and all furniture, fixtures, business personal property of any kind, nature, character, or description, operated, owned, or leased by Acquired Corporation at the Leased Premises.

		●	Any and all intellectual property owned by Acquired Corporation, including the following:

		o	TREES

		o	Any other trademarks or intellectual property relating to TREES

35

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