Document:

Exhibit

Exhibit 10.1

AMENDMENT NUMBER SEVENTEEN TO CREDIT AGREEMENT
THIS AMENDMENT NUMBER SEVENTEEN TO CREDIT AGREEMENT (this "Amendment"), dated as of September 21, 2016, is entered into by and among the lenders identified on the signature pages hereof (such Lenders, together with their respective successors and permitted assigns, are referred to hereinafter each individually as a "Lender" and, collectively, as the "Lenders"), WELLS FARGO BANK, NATIONAL ASSOCIATION, a national banking association ("Wells Fargo"), as administrative agent for each member of the Lender Group and the Bank Product Providers (as such terms are defined in the below referenced Credit Agreement) (in such capacity, together with its successors and assigns in such capacity, "Agent"), ERICKSON INCORPORATED (formerly known as Erickson Air-Crane Incorporated), a Delaware corporation ("EAC"), ERICKSON HELICOPTERS, INC. (formerly known as Evergreen Helicopters, Inc.), an Oregon corporation ("Helicopters") (Helicopters, together with EAC, are referred to hereinafter each individually as a "Borrower", and individually and collectively, jointly and severally, as the "Borrowers"), the Subsidiaries of Borrowers identified on the signature pages hereof (such Subsidiaries are referred to hereinafter each individual as a "Guarantor", and individually and collectively, jointly and severally, as the "Guarantors"), and in light of the following:
WITNESSETH
WHEREAS, Lenders, Agent, Wells Fargo, as lead arranger, book runner, syndication agent, and documentation agent, and Borrowers are parties to that certain Credit Agreement, dated as of May 2, 2013 (as amended, restated, supplemented, or otherwise modified from time to time, the "Credit Agreement");
WHEREAS, Agent and Borrowers are parties to that certain amendment fee letter, dated as of September 9, 2016 (the "Amendment Number Sixteen Fee Letter");
WHEREAS, Borrowers have requested that Agent and Lenders make certain amendments to the Credit Agreement and the Amendment Number Sixteen Fee Letter; and
WHEREAS, upon the terms and conditions set forth herein, Agent and Required Lenders are willing to accommodate Borrowers' requests.
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants herein contained, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereby agree as follows:
1.Defined Terms.  All initially capitalized terms used herein (including the preamble and recitals hereof) without definition shall have the meanings ascribed thereto in the Credit Agreement (including Schedule 1.1 thereto), as amended hereby.
2.Amendments.  Subject to the satisfaction (or waiver in writing by Agent) of the conditions precedent set forth in Section 4 hereof, the Credit Agreement and the Amendment Number Sixteen Fee Letter are hereby amended as follows: 

(a)Clause (c) of Article 7 of the Credit Agreement is hereby amended and restated in its entirety as follows:
(c)    Excess Availability.  Borrowers shall have Excess Availability at all times of at least (i) as of any date of determination during the period from July 25, 2016 through and including August 29, 2016, $10,000,000, (ii) as of any date of determination during the period from August 30, 2016 through and including September 28, 2016, $13,000,000, (iii) as of any date of determination during the period from September 29, 2016 through and including October 10, 2016, $17,500,000, and (iv) as of any date of determination during the period from October 11, 2016 through and including December 31, 2016, $20,000,000. 
(b)Schedule 1.1 to the Credit Agreement is hereby amended by inserting the following new definitions therein in the appropriate alphabetical order:
"Seventeenth Amendment" means that certain Amendment Number Seventeen dated as of September 21, 2016 (and effective as of the Seventeenth Amendment Effective Date) among Agent, the Lenders party thereto, Borrowers, and the Guarantors party thereto.
"Seventeenth Amendment Effective Date" shall have the meaning assigned thereto in the Seventeenth Amendment.
(c)Effective as of September 16, 2016, Section B of the Amendment Number Sixteen Fee Letter is hereby amended by replacing the reference therein to "September 16, 2016" with a reference to "September 21, 2016 (or such later date as Agent may agree to in writing)".
3.[Reserved.]
4.Conditions Precedent to Amendment.  The satisfaction (or waiver in writing by Agent) of each of the following shall constitute conditions precedent to the effectiveness of the Amendment (such date being the "Seventeenth Amendment Effective Date"):
(a)the Seventeenth Amendment Effective Date shall occur on or prior to September 21, 2016.
(b)Agent shall have received this Amendment, duly executed by the parties hereto, and the same shall be in full force and effect.
(c)Agent shall have received an amendment fee letter, dated as of the date hereof, by and among Agent and Borrowers, in form and substance satisfactory to Agent, duly executed and delivered by the parties thereto.
(d)Agent shall have received the Updated DIP Budget (as defined in the Amendment Number Sixteen Fee Letter), in form and substance reasonably satisfactory to Agent and which shall have been prepared by Financial Advisor (as defined in the Amendment Number Sixteen Fee Letter) in consultation with Borrowers' management.

- 2 -

(e)the representations and warranties herein and in the Credit Agreement and the other Loan Documents as amended hereby shall be true, correct and complete in all material respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof) on and as of the date hereof, as though made on such date (except to the extent that such representations and warranties relate solely to an earlier date, in which case such representations and warranties shall be true, correct and complete in all material respects as of such earlier date).
(f)no Default or Event of Default shall have occurred and be continuing or shall result from the consummation of the transactions contemplated herein.
(g)No injunction, writ, restraining order, or other order of any nature prohibiting, directly or indirectly, the consummation of the transactions contemplated herein shall have been issued and remain in force by any Governmental Authority against any Loan Party, Agent, or any Lender.
(h)Borrowers shall pay concurrently with the closing of the transactions evidenced by this Amendment, all fees, costs, expenses and taxes then payable pursuant to the Credit Agreement and Section 6 of this Amendment.
(i)All other documents and legal matters in connection with the transactions contemplated by this Amendment shall have been delivered, executed, or recorded and shall be in form and substance satisfactory to Agent.
5.Representations and Warranties.  Each Loan Party hereby represents and warrants to Agent and the Lenders as follows:
(a)It (i) is duly organized and existing and in good standing under the laws of the jurisdiction of its organization, (ii) is qualified to do business in any state where the failure to be so qualified could reasonably be expected to result in a Material Adverse Effect, and (iii) has all requisite power and authority to own and operate its properties, to carry on its business as now conducted and as proposed to be conducted, to enter into this Amendment and the other Loan Documents to which it is a party and to carry out the transactions contemplated hereby and thereby.
(b)The execution, delivery, and performance by it of this Amendment and the other Loan Documents to which it is a party (i) have been duly authorized by all necessary action on the part of such Loan Party and (ii) do not and will not (A) violate any material provision of federal, state, or local law or regulation applicable to such Loan Party, the Governing Documents of Borrower, or any order, judgment, or decree of any court or other Governmental Authority binding on such Loan Party, (B) conflict with, result in a breach of, or constitute (with due notice or lapse of time or both) a default under any Material Contract of such Loan Party except to the extent that any such conflict, breach or default could not individually or in the aggregate reasonably be expected to have a Material Adverse Effect, (C) result in or require the creation or imposition of any Lien of any nature whatsoever upon any assets of such Loan Party, other than Permitted Liens, (D) require any approval of such Loan Party's interest holders or any approval or consent of any Person under any Material Contract of such Loan Party, other than consents or approvals that have been obtained 

- 3 -

and that are still in force and effect and except, in the case of Material Contracts, for consents or approvals, the failure to obtain could not individually or in the aggregate reasonably be expected to cause a Material Adverse Effect, or (E) require any registration with, consent, or approval of, or notice to, or other action with or by, any Governmental Authority, other than registrations, consents, approvals, notices, or other actions that have been obtained and that are still in force and effect and except for filings and recordings with respect to the Collateral to be made, or otherwise delivered to Agent for filing or recordation in connection with this Amendment.
(c)This Amendment has been duly executed and delivered by each Loan Party.  This Amendment and each Loan Document to which such Loan Party is a party is the legally valid and binding obligation of such Loan Party, enforceable against such Loan Party in accordance with its respective terms, except as enforcement may be limited by equitable principles or by bankruptcy, insolvency, reorganization, moratorium, or similar laws relating to or limiting creditors' rights generally.
(d)No injunction, writ, restraining order, or other order of any nature prohibiting, directly or indirectly, the consummation of the transactions contemplated herein has been issued and remains in force by any Governmental Authority against any Loan Party, Agent or any Lender.
(e)No Default or Event of Default has occurred and is continuing as of the date of the effectiveness of this Amendment, and no condition exists which constitutes a Default or an Event of Default.
(f)The representations and warranties in the Credit Agreement and the other Loan Documents as amended hereby are true, correct and complete in all material respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof) on and as of the date hereof, as though made on such date (except to the extent that such representations and warranties relate solely to an earlier date, in which case such representations and warranties shall be true, correct and complete in all material respects as of such earlier date).
6.Payment of Costs and Fees.  Borrowers agree to pay all out-of-pocket costs and expenses of Agent (including, without limitation, the reasonable fees and disbursements of outside counsel to Agent) in connection with the preparation, negotiation, execution and delivery of this Amendment and any documents and instruments relating hereto.
7.Release.
(a)Each Loan Party hereby acknowledges and agrees that the Obligations under the Credit Agreement and the other Loan Documents are payable pursuant to the Credit Agreement and the other Loan Documents as modified hereby without defense, offset, withholding, counterclaim, or deduction of any kind.
(b)Effective on the date hereof, each Loan Party, for itself and on behalf of its successors, assigns, and officers, directors, employees, agents and attorneys, and any Person acting for or on behalf of, or claiming through it, hereby waives, releases, remises and forever discharges 

- 4 -

each member of the Lender Group, each Bank Product Provider, and each of their respective Affiliates, and each of their respective successors in title, past, present and future officers, directors, employees, limited partners, general partners, investors, attorneys, assigns, subsidiaries, shareholders, trustees, agents and other professionals and all other persons and entities to whom any member of the Lenders would be liable if such persons or entities were found to be liable to such Loan Party (each a "Releasee" and collectively, the "Releasees"), from any and all past, present and future claims, suits, liens, lawsuits, adverse consequences, amounts paid in settlement, debts, deficiencies, diminution in value, disbursements, demands, obligations, liabilities, causes of action, damages, losses, costs and expenses of any kind or character, whether based in equity, law, contract, tort, implied or express warranty, strict liability, criminal or civil statute or common law (each a "Claim" and collectively, the "Claims"), whether known or unknown, fixed or contingent, direct, indirect, or derivative, asserted or unasserted, matured or unmatured, foreseen or unforeseen, past or present, liquidated or unliquidated, suspected or unsuspected, which such Loan Party ever had from the beginning of the world to the date hereof, or now has, against any such Releasee which relates, directly or indirectly to the Credit Agreement, any other Loan Document, or to any acts or omissions of any such Releasee with respect to the Credit Agreement or any other Loan Document, or to the lender-borrower relationship evidenced by the Loan Documents, except for the duties and obligations set forth in any of the Loan Documents or in this Amendment. As to each and every Claim released hereunder, each Loan Party hereby represents that it has received the advice of legal counsel with regard to the releases contained herein, and having been so advised, specifically waives the benefit of the provisions of Section 1542 of the Civil Code of California which provides as follows:
"A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH A CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM, MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR."
As to each and every Claim released hereunder, each Loan Party also waives the benefit of each other similar provision of applicable federal or state law (including without limitation the laws of the state of California), if any, pertaining to general releases after having been advised by its legal counsel with respect thereto. 
Each Loan Party each acknowledges that it may hereafter discover facts different from or in addition to those now known or believed to be true with respect to such Claims and agrees that this instrument shall be and remain effective in all respects notwithstanding any such differences or additional facts. Each Loan Party understands, acknowledges and agrees that the release set forth above may be pleaded as a full and complete defense and may be used as a basis for an injunction against any action, suit or other proceeding which may be instituted, prosecuted or attempted in breach of the provisions of such release. 
(c)Each Loan Party, for itself and on behalf of its successors, assigns, and officers, directors, employees, agents and attorneys, and any Person acting for or on behalf of, or claiming through it, hereby absolutely, unconditionally and irrevocably, covenants and agrees with and in favor of each Releasee above that it will not sue (at law, 

- 5 -

in equity, in any regulatory proceeding or otherwise) any Releasee on the basis of any Claim released, remised and discharged by such Person pursuant to the above release, If any Loan Party or any of its respective successors, assigns, or officers, directors, employees, agents or attorneys, or any Person acting for or on behalf of, or claiming through it violate the foregoing covenant, such Person, for itself and its successors, assigns and legal representatives, agrees to pay, in addition to such other damages as any Releasee may sustain as a result of such violation, all attorneys' fees and costs incurred by such Releasee as a result of such violation.
8.Choice of Law and Venue; Jury Trial Waiver; Judicial Reference.  THIS AMENDMENT SHALL BE SUBJECT TO THE PROVISIONS REGARDING CHOICE OF LAW AND VENUE, JURY TRIAL WAIVER, AND JUDICIAL REFERENCE SET FORTH IN SECTION 12 OF THE CREDIT AGREEMENT, AND SUCH PROVISIONS ARE INCORPORATED HEREIN BY THIS REFERENCE, MUTATIS MUTANDIS.
9.Amendments.  This Amendment cannot be altered, amended, changed or modified in any respect or particular unless each such alteration, amendment, change or modification is made in accordance with the terms and provisions of  Section 14.1 of the Credit Agreement.
10.Counterpart Execution.  This Amendment may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which, when executed and delivered, shall be deemed to be an original, and all of which, taken together shall constitute but one and the same agreement. Delivery of an executed counterpart of this Amendment by facsimile or other electronic method of transmission shall be equally effective as delivery of an original executed counterpart of this Amendment. Any party delivering an executed counterpart of this Amendment by facsimile or other electronic method of transmission also shall deliver an original executed counterpart of this Amendment, but the failure to deliver an original executed counterpart shall not affect the validity, enforceability, and binding effect of this Amendment.
11.Effect on Loan Documents.
(a)Each of the Credit Agreement and the Amendment Number Sixteen Fee Letter, as amended hereby, and each of the other Loan Documents, as amended as of the date hereof, shall be and remain in full force and effect in accordance with their respective terms and hereby are ratified and confirmed in all respects. The execution, delivery, and performance of this Amendment shall not operate, except as expressly set forth herein, as a waiver of, consent to, or a modification or amendment of, any right, power, or remedy of Agent or any Lender under the Credit Agreement, the Amendment Number Sixteen Fee Letter or any other Loan Document. Except for the amendments to the Credit Agreement and the Amendment Number Sixteen Fee Letter expressly set forth herein, the Credit Agreement, the Amendment Number Sixteen Fee Letter and the other Loan Documents shall remain unchanged and in full force and effect.
(b)Upon and after the effectiveness of this Amendment, (i) each reference in the Credit Agreement to "this Agreement", "hereunder", "herein", "hereof" or words of like import referring to the Credit Agreement, and each reference in the other Loan Documents to "the Credit Agreement", "thereunder", "therein", "thereof' or words of like import referring to the Credit 

- 6 -

Agreement, shall mean and be a reference to the Credit Agreement as modified and amended hereby, and (ii) each reference in the Amendment Number Sixteen Fee Letter  to "this Amendment Fee Letter", "hereunder", "herein", "hereof" or words of like import referring to the Amendment Number Sixteen, and each reference in the other Loan Documents to the "Amendment Number Sixteen Fee Letter", "thereunder", "therein", "thereof" or words of like import referring to the Amendment Number Sixteen Fee Letter, shall mean and be a reference to the Amendment Number Sixteen Fee Letter as modified and amended hereby.
(c)To the extent that any of the terms and conditions in any of the Loan Documents shall contradict or be in conflict with any of the terms or conditions of the Credit Agreement or the Amendment Number Sixteen Fee Letter, after giving effect to this Amendment, such terms and conditions are hereby deemed modified or amended accordingly to reflect the terms and conditions of the Credit Agreement and the Amendment Number Sixteen Fee Letter as modified or amended hereby.
(d)This Amendment is a Loan Document.
(e)Unless the context of this Amendment clearly requires otherwise, references to the plural include the singular, references to the singular include the plural, the terms "includes" and "including" are not limiting, and the term "or" has, except where otherwise indicated, the inclusive meaning represented by the phrase "and/or". The words "hereof', "herein", "hereby", "hereunder", and similar terms in this Agreement refer to this Agreement as a whole and not to any particular provision of this Agreement. Section, subsection, clause, schedule, and exhibit references herein are to this Agreement unless otherwise specified. Any reference in this Agreement to any agreement, instrument, or document shall include all alterations, amendments, changes, extensions, modifications, renewals, replacements, substitutions, joinders, and supplements, thereto and thereof, as applicable (subject to any restrictions on such alterations, amendments, changes, extensions, modifications, renewals, replacements, substitutions, joinders, and supplements set forth herein). The words "asset" and "property" shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts, and contract rights. Any reference herein to any Person shall be construed to include such Person's successors and assigns.
12.Entire Agreement.  This Amendment, and the terms and provisions hereof, the Credit Agreement and the other Loan Documents constitute the entire understanding and agreement between the parties hereto with respect to the subject matter hereof and supersede any and all prior or contemporaneous amendments or understandings with respect to the subject matter hereof, whether express or implied, oral or written.
13.Reaffirmation of Obligations.  Each Loan Party hereby reaffirms its obligations under each Loan Document to which it is a party. Each Loan Party hereby further ratifies and reaffirms the validity and enforceability of all of the Liens and security interests heretofore granted, pursuant to and in connection with the Guaranty and Security Agreement, the Aircraft and Engine Security Agreement, or any other Loan Document, to Agent, as collateral security for the obligations under the Loan Documents in accordance with their respective terms, and acknowledges that all of such Liens and security interests, and all collateral heretofore pledged as security for such obligations, 

- 7 -

continue to be and remain collateral for such obligations from and after the date hereof. Each Loan Party hereby further does grant to Agent, for the benefit of each member of the Lender Group and the Bank Product Providers, a perfected security interest in the Collateral (as defined in the Guaranty and Security Agreement) and the Collateral (as defined in the Aircraft and Engine Security Agreement) in order to secure all of its present and future obligations under the Loan Documents.
14.Severability.  In case any provision in this Amendment shall be invalid, illegal or unenforceable, such provision shall be severable from the remainder of this Amendment and the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.
15.Guarantors.  Each of the undersigned Guarantors consent to the amendments to the Loan Documents contained herein. Although the undersigned Guarantors have been informed of the matters set forth herein and have consented to same, each Guarantor understands that no member of the Lender Group has any obligation to inform it of such matters in the future or to seek its acknowledgement or agreement to future consents, waivers, or amendments related to the Credit Agreement, and nothing herein shall create such a duty.
[signature pages follow]

- 8 -

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed and delivered as of the date first above written.
	
	
	ERICKSON INCORPORATED (formerly known as Erickson Air-Crane Incorporated), a Delaware corporation

By: /s/ David W. Lancelot
Name: David W. Lancelot
Title: Chief Financial Officer

	
	
	EAC ACQUISITION CORPORATION, a Delaware corporation

By: /s/ David W. Lancelot
Name: David W. Lancelot
Title: Chief Financial Officer, Treasurer

	
	
	ERICKSON HELICOPTERS, INC. (formerly known as. Evergreen Helicopters, Inc.), an Oregon corporation

By: /s/ David W. Lancelot
Name: David W. Lancelot
Title: Chief Financial Officer

	
	
	ERICKSON TRANSPORT, INC. (formerly known as Evergreen Helicopters of Alaska, Inc.), an Alaska. corporation

By: /s/ David W. Lancelot
Name: David W. Lancelot
Title: Chief Financial Officer, Treasurer

	
	
	EVERGREEN HELICOPTERS INTERNATIONAL, INC., a Texas corporation

By: /s/ David W. Lancelot
Name: David W. Lancelot
Title: Chief Financial Officer, Treasurer, VP

	
	
	EVERGREEN EQUITY, INC., a Nevada corporation

By: /s/ David W. Lancelot
Name: David W. Lancelot
Title: Chief Financial Officer, Treasurer, VP

	
	
	EVERGREEN UNMANNED SYSTEMS, INC., a Delaware corporation

By: /s/ David W. Lancelot
Name: David W. Lancelot
Title: Chief Financial Officer, Treasurer

	
	
	WELLS FARGO BANK, NATIONAL ASSOCIATION, a national banking association, as Agent, Lead Arranger, Book Runner, Syndication Agent, Documentation Agent, and a Lender

By: /s/ Brandi Whittington
Name: Brandi Whittington
Title: VP, Authorized Signatory

	
	
	HSBC BANK USA NA, as a Lender

By: /s/ Eric Dettmer
Name: Eric Dettmer
Title: Vice PresidentExhibit

Exhibit 10.1

GENERAL CANNABIS CORPORATION

PROMISSORY NOTE AND WARRANT

PURCHASE AGREEMENT

September 21, 2016

GENERAL CANNABIS CORPORATION

PROMISSORY NOTE AND WARRANT

PURCHASE AGREEMENT

This Promissory Note and Warrant Purchase Agreement (the “Agreement”) is made as of the 21st day of September 2016 by and between General Cannabis Corporation, a Colorado corporation (the “Company”) and each of the purchasers listed on Exhibit A attached to this Agreement (each a “Purchaser” and together the “Purchasers”).

RECITALS

The Company desires to issue and sell, and each Purchaser desires to purchase, a promissory note in substantially the form attached to this Agreement as Exhibit B (the “Note”) which shall be subject to a security agreement (the “Security Agreement”) in the form attached to this Agreement as Exhibit C, and subject to the provisions of Section 1(b)(iii) below, a Series A warrant to purchase shares of the Company’s $0.001 par value common stock (the “Common Stock”) at $0.35 per share (the “Series A Warrant”) and a Series B Warrant to purchase shares of Common Stock at $0.70 per share (the “Series B Warrant”) in substantially the form attached to this Agreement as Exhibit D and E, respectively (the “Warrants”, and together with this Agreement, the Notes and the Security Agreement, the “Transaction Documents”).  The Notes, the Warrants and the shares of common stock issuable upon conversion or exercise thereof (and the securities issuable upon conversion of such equity securities) are collectively referred to herein as the “Securities.”  The Company is issuing up to $3,000,000 principal amount of Notes and the accompanying Warrants (the “Offering”).

AGREEMENT

In consideration of the mutual promises contained herein and other good and valuable consideration, receipt of which is hereby acknowledged, the parties to this Agreement agree as follows:

1.

Purchase and Sale of Notes and Warrants.

(a)

Sale and Issuance of Notes and Warrants.  Subject to the terms and conditions of this Agreement, each Purchaser agrees to purchase at the Closing (as defined below) and the Company agrees to sell and issue to each Purchaser (i) a Note in the principal amount set forth opposite such Purchaser’s name on Exhibit A, (ii) subject to the provisions of Section 2 below, a Series A Warrant to purchase the number of shares of Common Stock equal to (A) the original principal amount of the Note, each as set forth opposite such Purchaser’s name on Exhibit A, multiplied by (B) 1.5, and (iii) a Series B Warrant to purchase the number of shares of Common Stock equal to (A) the original principal amount of the Note, each as set forth opposite such Purchaser’s name on Exhibit A, multiplied by (B) 1.5.  Each Warrant shall be exercisable for a period of three (3) years after the Closing.  The purchase price of each Note shall be equal to 100% of the principal amount of such Note, and the purchase price of each Warrant shall be the amount set forth opposite such Purchaser’s name on Exhibit A.  Each Note shall have a minimum purchase price of one hundred thousand dollars ($100,000.00), provided that the Company may elect to accept a lower purchase price at its sole discretion.  The Company’s agreements with each of the Purchasers are separate agreements, and the sales of the Notes and Warrants to each of the Purchasers are separate sales.

2.

Closing; Delivery.

(i)

The purchase and sale of the Notes and Warrants shall take place remotely via the exchange of documents and signature on the date hereof , or at such other place as the Company and the Purchasers mutually agree upon, orally or in writing,  as soon as practicable following such time that the Purchasers have agreed to purchase at such closing an aggregate amount of principal indebtedness evidenced by the Notes equal to at least $2,500,000 (which time and place are designated as the “Initial Closing”).  The Initial Closing shall occur by September 23, 2016 unless extended for a period of up to 60 days at the Company’s discretion.  Officers, directors and their affiliates may purchase securities in the Offering and existing holders of debt may convert their indebtedness to purchase Notes and Warrants hereunder and such purchases may be counted towards the Initial Closing.  In the event there is more than one closing, the term “Closing” shall apply to each such closing, unless otherwise specified herein.

(ii)

At each Closing, the Company shall deliver to each Purchaser the Note, the Security Agreement and the Warrant to be purchased by such Purchaser against (A) payment of the purchase price therefor by check payable to the Company or by wire transfer to a bank designated by the Company and (B) delivery of counterpart signature pages to this Agreement.

(iii)

Until such time as the aggregate amount of principal indebtedness evidenced by the Notes equals a total of three million dollars ($3,000,000.00), the Company may sell additional Notes and Warrants to such persons or entities as determined by the Company, or to any Purchaser who desires to acquire additional Notes and Warrants.  The Notes shall only be issued in denominations divisible by one thousand dollars ($1,000.00).  All such sales shall be made on the terms and conditions set forth in this Agreement.  The Company, in its sole discretion, shall determine the time and place of each Closing subsequent to the Initial Closing.  For purposes of this Agreement, and all other agreements contemplated hereby, any additional purchaser so acquiring Notes and Warrants shall be deemed to be a “Purchaser” for purposes of this Agreement, and any notes and warrants so acquired by such additional purchaser shall be deemed to be “Notes”, “Warrants” and “Securities” as applicable.

3.

Representations and Warranties of the Company.  The Company hereby represents and warrants to each Purchaser that, except as set forth on a Schedule of Exceptions delivered separately by the Company to each Purchaser, which exceptions shall be deemed to be representations and warranties as if made hereunder:

(a)

Organization, Good Standing and Qualification.  The Company is a corporation duly organized, validly existing and in good standing under the laws of the State of Colorado and has all requisite corporate power and authority to carry on its business as now conducted and as proposed to be conducted.  The Company is duly qualified to transact business and is in good standing in each jurisdiction in which the failure so to qualify would have a material adverse effect on its business or properties.

(b)

Authorization.  The Transaction Documents have been duly authorized by the Board of Directors of the Company; however, no stockholder approval has been obtained.  The Transaction Documents when executed and delivered by the Company, shall constitute valid and legally binding obligations of the Company, enforceable against the Company in accordance with their respective terms except as limited by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance and other laws of general application affecting enforcement of creditors’ rights generally, and as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies.

(c)

Effect of Agreement.  The execution, delivery and performance by the Company of the Transaction Documents to which it is a party, will not violate the charter documents, bylaws or formation documents as applicable of the Company or any law to which the Company is subject, or any judgment, award or decree or any material indenture, material agreement or other material instrument to which the Company is a party, or by which the Company or its properties or assets are bound, or conflict with, result in a breach of or constitute (with due notice or lapse of time or both) a default under, any such indenture, agreement or other instrument, or result in the creation or imposition of any lien of any nature whatsoever upon any of the properties or assets of the Company, except to the extent the effect thereof will not be materially adverse to the Company’s ability to fulfill its obligations under the Transaction Documents to which it is a party.

(d)

Legal Proceedings.  

 There is no order or action pending, or, to the knowledge of the Company, threatened against or affecting the Company in connection with the Company’s performance hereunder.  There is no matter as to which the Company, or, to the knowledge of the Company, any affiliate of the Company has received any notice, claim or assertion which otherwise has been threatened against or affecting the Company in connection its performance hereunder.

(e)

Seniority of Note.  The Company represents that upon receipt of the funds from this Offering and the application thereof as contemplated in this Agreement, the Notes shall be senior in terms of priority on liquidation to all other existing debt obligations of the Company (the “Remaining Debt”).

(f)

Other Representations.  Each of the representations and warranties of the Company (together with any related Schedule of Exceptions thereto) made in the Notes and the Security Agreement is hereby incorporated herein by reference (as though fully restated herein) and is hereby made to, and in favor of, each Purchaser.

4.

Representations and Warranties of the Purchasers.  Each Purchaser hereby represents and warrants to the Company that:

(a)

Authorization.  Such Purchaser has full power and authority to enter into this Agreement.  This Agreement,  when executed and delivered by the Purchaser, will constitute a valid and legally binding obligation of the Purchaser, enforceable in accordance with its terms, except as limited by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance, and any other laws of general application affecting enforcement of creditors’ rights generally, and as limited by laws relating to the availability of a specific performance, injunctive relief, or other equitable remedies.

(b)

Purchase Entirely for Own Account.  This Agreement is made with the Purchaser in reliance upon the Purchaser’s representation to the Company, which by the Purchaser’s execution of this Agreement, the Purchaser hereby confirms, that the Securities to be acquired by the Purchaser will be acquired for investment for the Purchaser’s own account, not as a nominee or agent, and not with a view to the resale or distribution of any part thereof, and that the Purchaser has no present intention of selling, granting any participation in, or otherwise distributing the same.  By executing this Agreement, the Purchaser further represents that the Purchaser does not presently have any contract, undertaking, agreement or arrangement with any person to sell, transfer or grant participations to such person or to any third person, with respect to any of the Securities. The Purchaser has not been formed for the specific purpose of acquiring any of the Securities.

(c)

Knowledge.  The Purchaser is aware of the Company’s business affairs and financial condition and has acquired sufficient information about the Company to reach an informed and knowledgeable decision to acquire the Securities.

(d)

Restricted Securities.  The Purchaser understands that the Securities have not been, and will not be, registered under the Securities Act of 1933, as amended (the “Securities Act”), by reason of a specific exemption from the registration provisions of the Securities Act which depends upon, among other things, the bona fide nature of the investment intent and the accuracy of the Purchaser’s representations as expressed herein.  The Purchaser understands that the Securities are “restricted securities” under applicable U.S. federal and state securities laws and that, pursuant to these laws, the Purchaser must hold the Securities indefinitely unless they are registered with the Securities and Exchange Commission and qualified by state authorities, or an exemption from such registration and qualification requirements is available.  The Purchaser acknowledges that the Company has no obligation to register or qualify the Securities for resale.  The Purchaser further acknowledges that if an exemption from registration or qualification is available, it may be conditioned on various requirements including, but not limited to, the time and manner of sale, the holding period for the Securities, and on requirements relating to the Company which are outside of the Purchaser’s control, and which the Company is under no obligation and may not be able to satisfy.

(e)

No Public Market.  The Purchaser understands that there is no public market now for the Notes and Warrants and only a limited market exists for the Company’s common stock and the Company has made no assurances that a significant public market will ever exist for the Securities.

(f)

Legends.  The Purchaser understands that the Securities, and any securities issued in respect thereof or exchange therefor, may bear one or all of the following legends:

(i)

“THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AND HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNEC­TION WITH, THE SALE OR DISTRIBUTION THEREOF.  NO SUCH SALE OR DISTRIBUTION MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL IN A FORM SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE SECURITIES ACT OF 1933.”

(ii)

Any legend required by the Blue Sky laws of any state to the extent such laws are applicable to the shares represented by the certificate so legended.

(g)

Accredited Investor.  The Purchaser is an accredited investor as defined in Rule 501(a) of Regulation D promulgated under the Securities Act and has completed the investor questionnaire attached as Exhibit A1.

5.

Conditions of the Purchasers’ Obligations at Closing.  The obligations of each Purchaser to the Company under this Agreement are subject to the fulfillment, on or before the Closing, of each of the following conditions, unless otherwise waived:

(a)

Representations, Warranties and Covenants.  The representations and warranties of the Company contained in Section 3 (including those incorporated by reference) shall be true on and as of the Closing with the same effect as though such representations and warranties had been made on and as of the date of the Closing and the Company shall have complied with all covenants in this Agreement, the Security Agreement, the Note and the other agreements and documents contemplated hereby to be complied with as of or prior to the Closing.

(b)

Qualifications.  All authorizations, approvals or permits, if any, of any governmental authority or regulatory body of the United States or of any state that are required in connection with the lawful issuance and sale of the Securities pursuant to this Agreement shall be obtained and effective as of the Closing.

6.

Conditions of the Company’s Obligations at Closing.  The obligations of the Company to each Purchaser under this Agreement are subject to the fulfillment, on or before the Closing, of each of the following conditions, unless otherwise waived:

(a)

Representations, Warranties and Covenants.  The representations and warranties of each Purchaser contained in Section 4 shall be true on and as of the Closing with the same effect as though such representations and warranties had been made on and as of the Closing and the Purchaser shall have complied with all covenants in this Agreement, the Security Agreement, the Note and the other agreements and documents contemplated hereby to be complied with as of or prior to the Closing.

(b)

Qualifications.  All authorizations, approvals or permits, if any, of any governmental authority or regulatory body of the United States or of any state that are required in connection with the lawful issuance and sale of the Securities pursuant to this Agreement shall be obtained and effective as of the Closing.

7.

Miscellaneous and Other Covenants.

(a)

Successors and Assigns.  The terms and conditions of this Agreement shall inure to the benefit of and be binding upon the respective successors and assigns of the parties.  Nothing in this Agreement, express or implied, is intended to confer upon any party other than the parties hereto or their respective successors and assigns any rights, remedies, obligations, or liabilities under or by reason of this Agreement, except as expressly provided in this Agreement.

(b)

Governing Law.  This Agreement and all acts and transactions pursuant hereto and the rights and obligations of the parties hereto shall be governed, construed and interpreted in accordance with the laws of the State of Colorado without giving effect to principles of conflicts of law.  

(c)

Counterparts.  This Agreement may be executed in two or more counter­parts, each of which shall be deemed an original and all of which together shall constitute one instrument.

(d)

Titles and Subtitles.  The titles and subtitles used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement.

(e)

Notices.  Any notice required or permitted by this Agreement or the Note shall be in writing and shall be deemed sufficient upon receipt, when delivered personally or by courier, overnight delivery service or confirmed facsimile, or 48 hours after being deposited in the U.S. mail as certified or registered mail with postage prepaid, if such notice is addressed to the party to be notified at such party’s address or facsimile number as set forth below or as subsequently modified by written notice.  The Company covenants that in the event that any Purchaser gives notice of their exercise of the Warrants, the Company will promptly notify all other Purchasers of such exercise.

(f)

Finder’s Fee.  Each party represents that it neither is nor will be obligated for any finder’s fee or commission in connection with this transaction.  Each Purchaser agrees to indemnify and to hold harmless the Company from any liability for any commission or compensation in the nature of a finder’s fee (and the costs and expenses of defending against such liability or asserted liability) for which each Purchaser or any of its officers, employees, or representatives is responsible.  The Company agrees to indemnify and hold harmless each Purchaser from any liability for any commission or compensation in the nature of a finder’s fee (and the costs and expenses of defending against such liability or asserted liability) for which the Company or any of its officers, employees or representatives is responsible.

(g)

Amendments and Waivers.  Any term of this Agreement may be amended or waived only with the written consent of the Company and the holders of at least a majority in interest of the Notes.  Any amendment or waiver effected in accordance with this Section 7(g) shall be binding upon each Purchaser and each transferee of the Securities, each future holder of all such Securities, and the Company.

(h)

Severability.  If one or more provisions of this Agreement are held to be unenforceable under applicable law, the parties agree to renegotiate such provision in good faith, in order to maintain the economic position enjoyed by each party as close as possible to that under the provision rendered unenforceable.  In the event that the parties cannot reach a mutually agreeable and enforceable replacement for such provision, then (i) such provision shall be excluded from this Agreement, (ii) the balance of the Agreement shall be interpreted as if such provision were so excluded and (iii) the balance of the Agreement shall be enforceable in accordance with its terms.

(i)

Entire Agreement.  This Agreement, and the Exhibits hereto and the other documents referred to herein and therein constitute the entire agreement between the parties hereto pertaining to the subject matter hereof, and any and all other written or oral agreements existing between the parties hereto are expressly canceled.

(j)

Exculpation Among Purchasers.  Each Purchaser acknowledges that it is not relying upon any person, firm or corporation, other than the Company and its officers and directors, in making its investment or decision to invest in the Company.  Each Purchaser agrees that no Purchaser nor the respective controlling persons, officers, directors, partners, agents, or employees of any Purchaser shall be liable for any action heretofore or hereafter taken or omitted to be taken by any of them in connection with the Securities.

(m)

Stockholders, Officers and Directors Not Liable.  In no event shall any stockholder, officer or director of the Company be liable for any amounts due or payable pursuant to the Note.

(n)

Loss of Note.  Upon receipt by the Company of evidence satisfactory to it of the loss, theft, destruction or mutilation of the Note or any Note exchanged for it, and indemnity satisfactory to the Company (in case of loss, theft or destruction) or surrender and cancellation of such Note (in case of mutilation), the Company will make and deliver to Purchaser in lieu of such Note a new Note of like tenor.  

(o)

Expenses.  Each of the Parties shall be responsible for their respective expenses and costs incurred in connection with the negotiation, documentation and execution of this Agreement and the other agreements, and documents contemplated herein and therein; provided, however, at the time of the Closing of the transactions contemplated herein, the Company shall pay the fees and expenses of the counsel to the Purchasers hereunder, as a group, in an amount not to exceed $10,000. 

(p)

Extension of Option.  At or prior to the Closing, the Company shall extend through the maturity date of the Notes its option to purchase Infinity’s investment in Dixie Elixir on the terms currently contained in the existing option, which extension shall be obtained without any further consideration paid or payable to any person.

(q)

Right of First Refusal.  The Purchaser shall have the right, on behalf of himself and his affiliates, during the period from the date hereof until the second anniversary hereof to provide equity or debt financing to the Company on terms mutually agreeable to the Company and the Purchaser, or if such terms cannot be agreed to or the Company otherwise proposes to undertake such a financing, on terms offered in writing by any bona fide third party.  During the two-year term prescribed hereby, the Company shall not undertake any equity or debt financing without first notifying the Purchaser and providing it (and its affiliates) with not less than five  business days to elect to participate in any proposed debt or equity offering as prescribed hereby. 

(r)  Right to appoint a Director.    The Company agrees that holders of the majority of the principal amount of Notes sold hereunder shall have the right to appoint one individual to serve as a member of the Company’s Board of Directors, and if requested, the Company shall promptly, but no later than five (5) business days, take the necessary steps to appoint such nominee provided that such individual is reasonably acceptable to the Company.  Such director shall serve until the next annual meeting of shareholders is convened.  In the event that at the time of such annual meeting, the Notes are still outstanding or the Purchasers as a whole still own at least 50% of the Warrants or Warrant Shares (the “Director Threshold”) the Company will nominate the person designated by the Purchasers until the Director Threshold is no longer met.

The parties have executed this Promissory Note and Warrant Purchase Agreement as of the date first written above.

			
	 
	GENERAL CANNABIS CORPORATION:

	 
	 

	 
	Address:

	6565 E. Evans Avenue

	 
	 
	Denver, Colorado 80224

	 
	 
	 

	 
	Facsimile Number: (303) 997-1972

	 
	 
	 

	 
	 
	 

	 
	PURCHASERS:

	 
	 
	 

	 
	[Name]

	 

	 
	 
	 

	 
	By:

	 

EXHIBIT A1

FORM OF INVESTOR QUESTIONNAIRE

GENERAL CANNABIS CORPORATION

For Individual Investors Only

(All individual investors must INITIAL where appropriate.  Where there are joint investors both parties must INITIAL):

Initial _______ 

I certify that I have a “net worth” of at least $1 million either individually or through aggregating my individual holdings and those in which I have a joint, community property or other similar shared ownership interest with my spouse.  For purposes of calculating net worth under this paragraph, (i) the primary residence shall not be included as an asset, (ii) to the extent that the indebtedness that is secured by the primary residence is in excess of the fair market value of the primary residence, the excess amount shall be included as a liability, and (iii) if the amount of outstanding indebtedness that is secured by the primary residence exceeds the amount outstanding 60 days prior to the execution of this Subscription Agreement, other than as a result of the acquisition of the primary residence, the amount of such excess shall be included as a liability.

Initial _______

I certify that I have had an annual gross income for the past two years of at least $200,000 (or $300,000 jointly with my spouse) and expect my income (or joint income, as appropriate) to reach the same level in the current year.

For Non-Individual Investors

(all Non-Individual Investors must INITIAL where appropriate):

Initial _______

The undersigned certifies that it is a partnership, corporation, limited liability company or business trust that is 100% owned by persons who meet either of the criteria for Individual Investors, above.

Initial _______

The undersigned certifies that it is a partnership, corporation, limited liability company or business trust that has total assets of at least $5 million and was not formed for the purpose of investing in Company.

Initial _______

The undersigned certifies that it is an employee benefit plan whose investment decision is made by a plan fiduciary (as defined in ERISA §3(21)) that is a bank, savings and loan association, insurance company or registered investment adviser.

Initial _______

The undersigned certifies that it is an employee benefit plan whose total assets exceed $5,000,000 as of the date of the Subscription Agreement.

Initial _______

The undersigned certifies that it is a self-directed employee benefit plan whose investment decisions are made solely by persons who meet either of the criteria for Individual Investors, above.

Initial _______

The undersigned certifies that it is a U.S. bank, U.S. savings and loan association or other similar U.S. institution acting in its individual or fiduciary capacity.

Initial _______

The undersigned certifies that it is a broker-dealer registered pursuant to §15 of the Securities Exchange Act of 1934.

Initial _______

The undersigned certifies that it is an organization described in §501(c)(3) of the Internal Revenue Code with total assets exceeding $5,000,000 and not formed for the specific purpose of investing in Company.

Initial _______

The undersigned certifies that it is a trust with total assets of at least $5,000,000, not formed for the specific purpose of investing in Company, and whose purchase is directed by a person with such knowledge and experience in financial and business matters that he is capable of evaluating the merits and risks of the prospective investment.

Initial _______

The undersigned certifies that it is a plan established and maintained by a state or its political subdivisions, or any agency or instrumentality thereof, for the benefit of its employees, and which has total assets in excess of $5,000,000.

Initial _______

The undersigned certifies that it is an insurance company as defined in §2(a)(13) of the Securities Act of 1933, as amended, or a registered investment company.

GENERAL CANNABIS CORPORATION 

Investor Questionnaire

(Must be completed by Purchaser)

Section A - Individual Purchaser Information

Purchaser Name(s): ________________________________________________________________________

Individual executing Profile or Trustee: _______________________________________________________________________

Social Security Numbers / Federal I.D. Number: ________________________________________________________________________

Date of Birth: _________________  Marital Status: _________________

Joint Party Date of Birth:_________________

Investment Experience (Years): ___________

Annual Income: _________________

Net Worth: ________________

Home Street Address: ________________________________________________________________________

Home City, State & Zip Code: ________________________________________________________________________

Home Phone: ________________________ Home Fax: _____________________ 

Home Email: _______________________________

Employer: ________________________________________________________________________

Employer Street Address: ________________________________________________________________________

Employer City, State & Zip Code: ________________________________________________________________________

Bus. Phone: __________________________ Bus. Fax: _______________________ 

Bus. Email: ________________________________

Type of Business: ________________________________________________________________________

Please check if you are a FINRA member or affiliate of a FINRA member firm: _______

Section B – Entity Purchaser Information

Purchaser Name(s): ________________________________________________________________________

Authorized Individual executing Profile or Trustee: _______________________________________________________________________

Social Security Numbers / Federal I.D. Number: _______________________________________________________________________

Investment Experience (Years): ___________

Annual Income: _______________ 

Net Worth: ________________

Was the Trust formed for the specific purpose of purchasing the Units?

[   ] Yes  [   ] No

Principal Purpose (Trust)______________________________________

Type of Business: ________________________________________________________

Street Address: ____________________________________________________________

City, State & Zip Code: ________________________________________________________________________

Phone: ________________________          Fax: ________________________ 

Email: __________________________

Section C – Form of Payment – Check or Wire Transfer

____  Check payable to “GENERAL CANNABIS CORPORATION”

____  Wire funds from my outside account according to the “To subscribe for Units of Notes and Warrants to Purchase Shares of Common Stock in the private offering of GENERAL CANNABIS CORPORATION” 

Section E – Securities Delivery Instructions (check one)

____  Please deliver my securities to the address listed in the above Investor Questionnaire.

____  Please deliver my securities to the below address:

______________________________________

______________________________________

______________________________________

______________________________________

					
	Purchaser Signature(s)

	 
	 
	Date

	 

	 
	 
	 
	 
	 

	Purchaser Signature(s)

	 
	 
	Date

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00262-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00262-of-00352.parquet"}]]