Document:

Exhibit 10.45

 

		1180 Seminole Tr., Suite 495

Charlottesville, VA 22901 USA

T +1 (434) 422-9800

F +1 (434) 422-9797

www.adialpharma.com

 

As of March 22, 2022

 

Bankole Johnson

1395 Brickell Avenue

Suite 200

Miami, FL 33131 

 

RE:  Contract Extension Agreement

 

Dear Dr. Johnson:

 

Reference is hereby made to
that certain agreement entered into as of March 24, 2019, between Adial Pharmaceuticals, Inc. (“Company”) and Dr. Bankole
A. Johnson (“Consultant”), including all Exhibits thereto (collectively, “Agreement”). All terms used herein that
are defined in the Agreement shall have the same meaning herein as in the Agreement.

 

This letter confirms that
for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged and agreed, Company and Consultant have
agreed to amend and extend the Agreement (the “Amendment”), and sets forth our mutual agreement with respect to the Amendment.
Except as expressly modified by the terms of the Amendment, all other terms and conditions of the Agreement remain unaltered and in full
force and effect, and are hereby ratified and confirmed.

 

The Agreement during the Term
shall be amended as follows:

 

		1.	Upon the expiration of the Term, the Agreement shall be automatically and without interruption extended
for an additional three (3) year term (“Extended Term”), subject to any earlier termination, commencing as of March 24, 2022.

 

The Agreement
during the Extended Term shall be amended as follows:

 

		2.	Paragraphs 2(b) and 2(c) are hereby deleted in their entirety and replaced with the following:

 

“This Agreement and/or any Services
to be performed by Consultant under this Agreement may be terminated by Company or Consultant after thirty (30) days prior written notice
to the other Party, for any or no reason, with or without Cause. Upon any effective termination date, Consultant shall immediately cease
work and deliver to Company all work in progress and return all Company Confidential Information (as defined in Section 8 below) and any
Company owned materials and/or equipment. Company’s sole obligation shall be to pay Consultant undisputed monies owed Consultant
up to the time of termination for Services actually performed and reasonable expenses actually incurred. Any unearned or unexpended portion
of monies previously paid by Company to Consultant shall be refunded to Company.”

 

    Page 1 of 3

     

    

 

		3.	“Exhibit A” and all references thereto shall be deleted throughout the Agreement in their
entirety, and such Exhibit and references thereto shall be replaced in all instances with the attached “Exhibit D.”

 

		4.	Paragraph 21 shall be amended to replace Company’s and Consultant’s addresses for notice with
their respective addresses used in this Extension Agreement; and required notice to Eric N. Heyner, Esq. shall be deleted.

 

If the foregoing correctly
sets forth our complete and accurate understanding regarding the Agreement, please sign and return this Amendment, whereupon receipt of
such fully executed copy of the Amendment shall constitute a binding amendment to the Agreement.

 

	AGREED TO AND ACCEPTED BY:	 	 	 
	 	 	 	 	 
	Adial Pharmaceuticals, Inc. (“Company”)	 	Dr. Bankole A. Johnson (“Consultant”)
	 	 	 	 	 
	By:	/s/ William B. Stilley	 	 	/s/ Bankole A. Johnson
	 	 	 	 	 
	Name: 	William B. Stilley	 	Name: 	Bankole A. Johnson
	 	 	 	 	 
	Title:	Chief Executive Officer	 	 	 

 

    Page 2 of 3

     

    

 

EXHIBIT D

 

CONSULTING SERVICES

 

Consultant shall perform for Company the Services
described below.

 

SERVICES AND WORK PLAN 

 

Consultant shall render Services as, where and
when requested by Company, which Services shall include, without limitation, the following:

 

	●	If requested, serving as the principal investigator for Company
clinical trials;

	●	If requested, serving as a safety reviewer;

	●	If requested, preparation of reports and publications related
to the Company’s business; and

	●	Other activities and responsibilities reasonably requested
by the Company.

 

Additionally, and without limiting the above,
Consultant will file applications for grant funding for which the Company is eligible on behalf of the Company. In the event grant funding
is secured, Consultant will and hereby does, grant the Company unconditional rights to, within the bounds of applicable laws and regulations,
direct the proper use of the grant funding, and Consultant agrees that he will take no actions to redirect grant funding, or to otherwise
contravene the value of the grant to the Company, without the prior written consent of the Company, which consent will be at the Company’s
sole and final discretion. Consultant may apply for grants for other entities if such grants are not for the development of a pharmaceutical
product or products and are not competitive to any product of the Company at the time of the grant filing, without the prior written permission
of the Company.

 

COMPENSATION 

 

Compensation for Services provided pursuant to
this Agreement shall be $31,250 per month (the “Monthly Compensation”) for each month that Services are provided, payable
in two equal installments on the first and fifteenth days of the month following the month in which Services are performed.

 

Consultant shall continue to be entitled to receive
payment under the Company’s Grant Incentive

Plan as amended on December 4, 2018 (the “GIP”)
for any grants related to the development of AD04 and will no longer be eligible under the GIP for grants unrelated to AD04.

 

Consultant shall receive no other payment or expense
reimbursement for Consultant’s provision of Services as described herein.

 

 

Page 3 of 3DESCRIPTION OF THE REGISTRANT’S SECURITIES REGISTERED PURSUANT
TO SECTION 12 OF THE SECURITIES EXCHANGE ACT OF 1934 
The following is a summary of information concerning capital stock of SmartKem, Inc. (“us,” “our,” “we” or the “Company”) and certain provisions of our Certificate of Incorporation (defined below) and Bylaws (defined below) currently in effect. This summary does not purport to be complete and is qualified in its entirety by the provisions of our Certificate of Incorporation (the “Certificate of Incorporation”) and Bylaws (the “Bylaws”), each previously filed with the Securities and Exchange Commission (“SEC”) and incorporated by reference as an exhibit to the Annual Report on Form 10-K, as well as to the applicable provisions of the Delaware General Corporation Law (the “DGCL”). We encourage you to read our Certificate of Incorporation, Bylaws and the applicable portions of the DGCL carefully.
 
General
 
We have authorized capital stock consisting of 300,000,000 shares of common stock and 10,000,000 shares of preferred stock. As of March 14, 2022, we had 26,566,809 shares of common stock issued and outstanding, and no shares of preferred stock issued and outstanding.
 
Common Stock
​
Voting Rights
​
Each holder of common stock is entitled to one vote for each share on all matters submitted to a vote of the stockholders, including the election of directors. Our Certificate of Incorporation and our Bylaws do not provide for cumulative voting rights. Because of this, the holders of a plurality of the shares of common stock entitled to vote in any election of directors can elect all of the directors standing for election, if they should so choose. With respect to matters other than the election of directors, at any meeting of the stockholders at which a quorum is present or represented, the affirmative vote of a majority of the voting power of the shares present in person or represented by proxy at such meeting and entitled to vote on the subject matter shall be the act of the stockholders, except as otherwise required by law. The holders of one-third of the stock issued and outstanding and entitled to vote, present in person or represented by proxy, shall constitute a quorum for the transaction of business at all meetings of the stockholders.
​
Dividends
​
Subject to preferences that may be applicable to any then-outstanding convertible preferred stock, holders of our common stock are entitled to receive dividends, if any, as may be declared from time to time by our board of directors out of legally available funds.
​
We have never paid cash dividends on our common stock. Moreover, we do not anticipate paying periodic cash dividends on our common stock for the foreseeable future. Any future determination about the payment of dividends will be made at the discretion of our board of directors and will depend upon our earnings, if any, capital requirements, operating and financial conditions, contractual restrictions, including any loan or debt financing agreements, and on such other factors as our board of directors deems relevant.
​
Liquidation
​
In the event of our liquidation, dissolution, or winding up, holders of our common stock will be entitled to share ratably in the net assets legally available for distribution to stockholders after the payment of all of our debts and other liabilities and the satisfaction of any liquidation preference granted to the holders of any then-outstanding shares of preferred stock.
​
Preferred Stock
​

We currently have no shares of preferred stock outstanding, and we have no present plan to issue any shares of preferred stock. Our board of directors has the authority, without further action by the stockholders, to issue up to 10,000,000 shares of preferred stock in one or more series and to fix the rights, preferences, privileges and restrictions thereof. These rights, preferences, and privileges could include dividend rights, conversion rights, voting rights, redemption rights, liquidation preferences, sinking fund terms, and the number of shares constituting any series or the designation of such series, any or all of which may be greater than the rights of common stock. The issuance of preferred stock could adversely affect the voting power of holders of common stock and the likelihood that such holders will receive dividend payments and payments
​
Anti-Takeover Effects of Certain Provisions of Delaware Law, Our Certificate of Incorporation and Our Bylaws
​
Certain provisions of Delaware law and certain provisions included in our Certificate of Incorporation and in our Bylaws summarized below may be deemed to have an anti-takeover effect and may delay, deter, or prevent a tender offer or takeover attempt that a stockholder might consider to be in its best interests, including attempts that might result in a premium being paid over the market price for the shares held by stockholders.
​
Preferred Stock
​
Our Certificate of Incorporation contains provisions that permit our board of directors to issue, without any further vote or action by the stockholders, shares of preferred stock in one or more series and, with respect to each such series, to fix the number of shares constituting the series and the designation of the series, the voting rights (if any) of the shares of the series and the powers, preferences, or relative, participation, optional, and other special rights, if any, and any qualifications, limitations, or restrictions, of the shares of such series.
​
Removal of Directors
​
Our Certificate of Incorporation provides that stockholders may only remove a director for cause.
​
Director Vacancies
​
Our Certificate of Incorporation authorizes only our board of directors to fill vacant directorships.
​
No Cumulative Voting
​
Our Certificate of Incorporation does not provide stockholders with the right to cumulate votes in the election of directors.
​
Special Meetings of Stockholders
​
Our Certificate of Incorporation and Bylaws provide that, except as otherwise required by law, special meetings of the stockholders may be called only by the chairperson of our board of directors, the chief executive officer, or our board of directors.
​
Advance Notice Procedures for Director Nominations
​
Our bylaws provide that stockholders seeking to nominate candidates for election as directors at an annual or special meeting of stockholders must provide timely notice thereof in writing. To be timely, a stockholder’s notice generally will have to be delivered to and received at our principal executive offices before notice of the meeting is issued by our secretary, with such notice being served not less than 90 nor more than 120 days before the meeting. Although the Bylaws do not give the board of directors the power to approve or disapprove stockholder nominations of candidates to be elected at an annual meeting, the Bylaws may have the effect of precluding the conduct of certain business at a meeting if the proper procedures are not followed or may discourage or deter a potential acquirer from conducting a solicitation of proxies to elect its own slate of directors or otherwise attempting to obtain control of our company.
​

Action by Written Consent
​
Our Certificate of Incorporation and Bylaws provide that any action to be taken by the stockholders must be effected at a duly called annual or special meeting of stockholders and may not be effected by written consent.
 
Amending our Certificate of Incorporation and Bylaws
​
Our Certificate of Incorporation provides that the affirmative vote of at least 66 2/3% of the votes entitled to be cast by holders of all outstanding shares then entitled to vote, voting together as a single class, is required to amend certain provisions of our Certificate of Incorporation.
​
Our Bylaws may be adopted, amended, altered or repealed by stockholders only upon approval of at least 66 2/3% of the votes entitled to be cast by holders of all outstanding shares then entitled to vote, voting together as a single class. Additionally, our Certificate of Incorporation provides that our bylaws may be amended, altered or repealed by the board of directors.
​
Authorized but Unissued Shares
​
Our authorized but unissued shares of common stock and preferred stock will be available for future issuances without stockholder approval, except as required by the listing standards of any exchange upon which our common stock may become listed, and could be utilized for a variety of corporate purposes, including future offerings to raise additional capital, acquisitions and employee benefit plans. The existence of authorized but unissued and unreserved common stock and preferred stock could render more difficult or discourage an attempt to obtain control of our company by means of a proxy contest, tender offer, merger, or otherwise.
​
Exclusive Jurisdiction
​
Our Certificate of Incorporation provides that, unless we consent to the selection of an alternative forum, the Court of Chancery of the State of Delaware, or if the Court of Chancery does not have jurisdiction, the federal district court for the District of Delaware, is the exclusive forum for (i) any derivative action or proceeding brought on behalf of us, (ii) any action asserting a claim of breach of a fiduciary duty owed by any current or former director, officer, or other employee to the us or our stockholders, (iii) any action arising pursuant to any provision of the DGCL or our certificate of incorporation or bylaws (as either may be amended from time to time), or (iv) (A) any action asserting a claim governed by the internal affairs doctrine of the law of the State of Delaware shall, to the fullest extent permitted by law, be exclusively brought in the Court of Chancery of the State of Delaware or, if such court does not have subject matter jurisdiction thereof, the federal district court of the State of Delaware and (B) the federal district courts of the United States shall be the exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act of 1933, as amended. Section 27 of the Exchange Act creates exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder. As a result, the exclusive forum provision will not apply to actions arising under the Exchange Act or the rules and regulations thereunder. Although our Certificate of Incorporation contains the exclusive forum provisions described above, it is possible that a court could find that such provision is inapplicable for a particular claim or action or that such provision is unenforceable, and our stockholders will not be deemed to have waived our compliance with the federal securities laws and the rules and regulations thereunder.
​
Delaware Anti-Takeover Statute
​
We are subject to Section 203 of the DGCL, which prohibits a person deemed an “interested stockholder” from engaging in a “business combination” with a publicly held Delaware corporation for three years following the date such person becomes an interested stockholder unless the business combination is, or the transaction in which the person became an interested stockholder was, approved in a prescribed manner or another prescribed exception applies. Generally, an “interested stockholder” is a person who, together with 

affiliates and associates, owns, or within three years prior to the determination of interested stockholder status did own, 15% or more of a corporation’s voting stock. Generally, a “business combination” includes a merger, asset or stock sale, or other transaction resulting in a financial benefit to the interested stockholder. The existence of this provision may have an anti-takeover effect with respect to transactions not approved in advance by the board of directors, such as discouraging takeover attempts that might result in a premium over the price of our common stock.
 
Listing
 
Our common stock is listed on the OTC Market Group’s OTCQB® Market quotation system under the ticker symbol “SMTK.”
 
Transfer Agent and Registrar
 
The transfer agent and registrar for our common stock is VStock Transfer, LLC.

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