Document:

ANTI-DILUTION AGREEMENT 

 

 

THIS
ANTI-DILUTION AGREEMENT (the “Agreement”) is dated as of January  15_, 2016 with an effective date (the
“Effective Date”) of January 2, 2016, and is by and among “ACACIA DIVERSIFIED HOLDINGS, INC., a Texas
corporation (“Acacia” or the “Company”), and STEVEN L. SAMPLE, an individual residing in
the State of Florida (“Mr. Sample”). Acacia and Mr. Sample are referred to collectively herein as the "Parties,"
and individually as a "Party."

 

WHEREAS, Mr. Sample and
the Company are both Parties to that certain Modified Employment Agreement with an Effective Date of January 4, 2016 and are relevant
Parties to the Asset Purchase Agreement also with an Effective Date of January 4, 2016, to which the form of this Agreement is
attached as Exhibit J and made a part thereof, all of which contemplates the execution and delivery of this Agreement by the Parties
hereto.

 

WHEREAS this Agreement
is certified and confirmed to be valid for all purposes by Richard K. Pertile (“Pertile”) acting in the capacity
as President of Seller as a party to the Asset Purchase Agreement of even date herewith to which this Agreement is made a part,
and by Pertile also acting as CEO-Elect of Acacia.

 

WHEREAS the Company and
Mr. Sample acknowledge and agree that the representations, warranties, covenants, agreements and indemnities contained in this
Agreement shall not be superseded as a result of the change of management of Acacia or the status of the Parties executing this
Agreement concomitant with the Closing of the Asset Purchase Agreement to which this Agreement is made a part, but shall remain
in full force and effect to the full extent provided herein.

 

NOW, THEREFORE, in consideration
of the premises and the representations, warranties, covenants and agreements contained in this Agreement and for other good and
valuable consideration, the receipt and sufficiency of which are hereby acknowledged (including, without limitation, the entering
into the various Agreements by and between the Parties and the MariJ Group of Companies dated January 15, 2016, each with an Effective
Date of January 4, 2016), so long as the Right of First Refusal to Purchase Common Stock the and Proxy included the Agreements
remain in full force and effect or Mr. Pertile shall have exercised his Right of First Refusal in acquiring the Primary CEO Equity
Consideration, the Parties hereto hereby agree as follows:

 

SECTION 1. Additional
Issuances.

 

(a) If at any time after
the Effective Date hereof, if the Company shall issue any additional shares of the Company’s Common Stock or warrants, options
or other rights or instruments of any kind convertible into or exercisable or exchangeable for shares of Common Stock (the “Additional
Securities”) for the purposes of raising capital, acquiring assets, or for any other authorized purpose, Mr. Sample shall
have the right to subscribe for and to purchase at the par value of the Company’s stock of $0.001 per share (“Par
Value”) that number of Additional Securities necessary to maintain a Fully-Diluted Ownership Percentage (as defined herein
below) in the Company equal to the lesser of: (i) Fully-Diluted Ownership Percentage of the Company on the date that a Subscription
Notice (as defined below) is delivered to Mr. Sample hereunder, and (ii) nine and nine-tenths percent (9.9%) of the Company’s
issued and outstanding Common Stock after first adjusting for the eventuality of the required disposal of 2,500,000 shares of Mr.
Sample’s Common Stock in the Company under the provisions of the Asset Purchase Agreement to which this Anti-Dilution is
made a part. By way of example, prior to Mr. Sample’s required disposal of 2,500,000 shares of his Common Stock of Acacia
as required in the Asset Purchase Agreement, this calculation would result in his entire personal holdings of Acacia, less 2,500,000
shares, then being made to equal to 9.9% of the total issued and outstanding Common Shares of the Company by the issuance to Mr.
Sample of new Common Shares of the Company at Par Value in such numbers such as to cause his total ownership to be equal to said
9.9%. Any offer of Additional Securities made

 

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to Mr. Sample under this Section 1 shall be made by notice in writing (the “Subscription
Notice”) at least 10 Business Days prior to the issuance of such Additional Securities. The Subscription Notice shall
set forth (i) the number of Additional Securities proposed to be issued to any Person other than Mr. Sample and the terms of such
Additional Securities, (ii) the consideration (or manner of determining the consideration), if any, for which such Additional Securities
are proposed to be issued and the terms of payment, (iii) the number of Additional Securities offered to Mr. Sample in compliance
with the provisions of this Section 1 and (iv) the proposed date of issuance of such Additional Securities. Not later than 5 Business
Days after delivery of a Subscription Notice in accordance with the notice provisions hereof, Mr. Sample shall deliver a notification
to the Company in writing whether he elects to purchase all or any portion of the Additional Securities offered to Mr. Sample,
pursuant to the Subscription Notice; provided however, that the failure of Mr. Sample to respond in writing within 5 Business Days
shall be deemed a waiver and negative election by Mr. Sample to purchase any of the Additional Securities offered by such Subscription
Notice. If Mr. Sample elects to purchase any such Additional Securities, the Additional Securities that he shall have elected to
purchase shall be issued and sold to Mr. Sample by the Company at the same time and on the same terms and conditions as the Additional
Securities are issued and sold to third Parties. If, for any reason, the issuance of Additional Securities to third Parties is
not consummated, Mr. Sample’s right to his share of such issuance shall lapse, subject to Mr. Sample’s ongoing subscription
rights with respect to issuances of Additional Securities at later dates or times.

 

(b) The Company represents
and covenants to Mr. Sample that (i) upon issuance, all the shares of Additional Securities sold to Mr. Sample pursuant to this
Section 1 shall be duly authorized, validly issued, fully paid and nonassessable and will be approved (if outstanding securities
of the Company of the same type are at the time already approved) for listing on the Nasdaq Stock Market or for quotation or listing
on the principal trading market for the securities of the Company at the time of issuance, (ii) upon delivery of such shares, they
shall be free and clear of all liens, claims and encumbrances (other than any restrictions imposed by applicable federal, state
and foreign securities laws of any nature and shall not be subject to any preemptive right of any stockholder of the Company and
(iii) this Section 1 does not and upon the issuance of such Additional Securities will not: (a) violate or conflict with any provision
of the Articles of Incorporation or Bylaws of ACACIA, each as amended then to date; (b) conflict with or constitute a violation
by ACACIA of any applicable law (including the Texas Business Organizations Code), judgment, order, injunction, decree, rule, regulation
or ruling of any governmental authority applicable to ACACIA the enforcement of which would have a material adverse effect on ACACIA
or on ACACIA’s ability to perform its obligations hereunder or the ability of ACACIA to consummate issuance of the Additional
Securities; and, (c) either alone or with the giving of notice or the passage of time, or both, modify, violate, conflict with,
constitute grounds for termination of, or accelerate the performance required by, or result in a breach or default of the terms,
conditions or provisions of, or constitute a default under any contract, agreement, note bond, mortgage, indenture, deed of trust,
license, franchise, permit, commitment, waiver, exemption, order, obligation, lease, sublease, undertaking, agreement, offer or
other instrument, which violation, conflict, termination, acceleration, breach or default would have a material adverse effect
on ACACIA or on the ability of ACACIA to perform its obligations hereunder or the ability of ACACIA to issue such shares.

 

(c) As used herein, the
term “Business Day” shall mean any day other than a Saturday, Sunday, U.S. national legal holiday, or a legal
holiday under the laws of the State of Texas or the State of Florida, and the term “Person” shall mean an individual,
corporation, partnership, joint venture, joint stock company, association, trust, business trust, unincorporated organization,
government authority, or any other entity of whatever nature. As used herein, the term “Fully-Diluted Ownership Percentage”
shall mean the percentage ownership calculated by dividing (i) the aggregate number of shares of Common Stock (including any shares
of Common Stock issuable upon exercise or conversion of options, warrants or other securities or rights) beneficially owned (as
such term is determined in accordance with the Rule 13d-3 promulgated under the Securities Exchange Act of 1934, as amended) by
the applicable Person or Persons, howsoever and whenever acquired, by (ii) the aggregate number of all issued and outstanding shares
of Common Stock of the Company (including any shares of Common Stock which are issuable upon exercise or conversion of options,
warrants or other securities or rights within 60 days of the date on which such calculation is being made).

 

(d) If the Company, at
any time while this Agreement is in force and effect, by reclassification of securities or otherwise (including, but not limited
to, a “reincorporation,” merger with or into a wholly owned subsidiary of the Company, an

 

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exchange or stock swap or
another type of reorganization or recapitalization) (individually or collectively the “Reorganization of Shares”),
shall change or exchange its Common Stock into (or for) different securities of another class or classes or ceases to have Common
Stock, then Mr. Sample’s rights hereunder shall thereafter represent the right to acquire such number and kind of securities
as would have been issuable as the result of such change with respect to the securities that were subject to the Agreement immediately
prior to such reclassification or other change. All such adjustments shall be made so as to equitably adjust Mr. Sample’s
rights hereunder such that he should own no less than nine and nine-tenths percent (9.9%) of the issued and outstanding shares
of the Company in any classification thereof in the Company or any newly-capitalized entity following any such Reorganization of
Shares.

 

SECTION 2. No Reverse
Stock Splits or Issuances of Preferred Shares. From the Effective Date of this Agreement until January 1, 2020, the Company
shall not cause to occur or suffer to be caused to occur any reverse stock split (“Reverse Stock Split”) to
its Common shares without the prior written consent of Mr. Sample. Similarly, the Company shall not during that same period cause
to occur or suffer to be caused to occur any issuance of shares of the preferred stock (“Preferred Stock” or
“Preferred Shares”) of the Company without the prior written consent of Mr. Sample. Any violation of these covenants
as to a Reverse Stock Split shall result in a requirement that the Company immediately issue to Mr. Sample sufficient new shares
of the Company’s common stock (“Common Stock” or “Common Shares”) such as to cause
his holdings thereof to be equal to the percentage of his Common Stock holdings relevant to the total issued and outstanding shares
of the Common Stock of the Company as of the date immediately preceding the Effective Date of this Agreement (meaning the percentage
of the total issued and outstanding Common Stock of the Company held by Mr. Sample in relation to the total number of Common Shares
of the Company issued and outstanding as of the date immediately preceding the Effective Date of this Agreement). Similarly, any
violation of these covenants as to issuance of Preferred Shares shall result in a requirement that the Company immediately issue
to Mr. Sample sufficient new shares of the Company’s Preferred Stock such as to cause his holdings of the Company’s
total issued and outstanding Preferred Shares to be equal to the percentage of his Common Stock holdings relevant to the total
issued and outstanding shares of the Common Stock of the Company as of the date immediately preceding the effective date of this
Agreement (meaning Mr. Sample would be issued an appropriate number of Preferred Shares of the Company such that his ownership
thereof would become in accordance with the percentage of Common Stock of the Company held by Mr. Sample in relation to the total
number of Common Shares of the Company issued and outstanding as of the date immediately preceding the Effective Date of this Agreement).
Any shares issued to Mr. Sample in accordance with this Section 2 shall be paid by Mr. Sample at Par Value.

 

SECTION 3. Further
Assurances. Each of the Parties hereto agrees that, at any time and from time to time after the date hereof, it shall, upon
written request from the other Party hereto, and without further consideration, perform such other and further acts, and execute,
acknowledge and deliver, or cause to be executed, acknowledged and delivered, such further instruments, documents and assurances
as such other Party reasonably may request for the purpose of carrying out this Agreement.

 

SECTION 4. Binding
Agreement; Assignment. This Agreement is binding upon, will inure to the benefit of, and be enforceable by, the Parties hereto
and their respective heirs, successors and permitted assigns. Neither this Agreement nor any of the rights, interests or obligations
under this Agreement shall be assigned, in whole or in part, by operation of law or otherwise by any of the Parties hereto, without
the prior written consent of the other Party hereto.

 

SECTION 5. Entire Agreement;
No Third-Party Beneficiaries. This Agreement constitutes the entire agreement and understanding of the Parties hereto with
respect to the subject matters hereof and thereof and supersedes any and all prior negotiations, agreements, arrangements and understandings
between the Parties, written or oral, relating to the matters provided for herein or therein. Except as expressly provided in this
Agreement, nothing contained in this Agreement, express or implied, is intended to or shall confer on any Person other than the
Parties hereto and their heirs, successors and permitted assigns, any rights, benefits, remedies or claims under or by reason of
this Agreement.

 

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SECTION 6. Amendment;
Modification. This Agreement may not be amended or modified except by an instrument in writing signed by a duly authorized
officer of each of the Company and Mr. Sample.

 

SECTION 7. Extensions;
Waivers; Remedies Cumulative.

 

(a) The conditions to
each of the Parties’ obligations to consummate this Agreement are for the sole benefit of such Party and may be waived by
such Party in whole or in part to the extent permitted by applicable law. With regard to this Agreement, any Party may (i) extend
the time for the performance of any of the obligations or other acts of any other Party with such first Party, or (ii) waive compliance
with any of the agreements of any Party with such first Party or with any conditions to its own obligations. Any agreement on the
part of a Party hereto to any such extension or waiver of any provision of this Agreement shall be valid and effective only if
set forth in an instrument in writing signed on behalf of such Party against whom enforcement of any waiver or consent is sought
by such first Party or a duly authorized officer thereof, if applicable.

 

(b) No failure or delay
on the part of any Party in exercising any right, privilege, power, or remedy under this Agreement, and no course of dealing among
the Parties, shall operate as a waiver of such right, privilege, power, or remedy, nor shall any single or partial exercise of
any right, privilege, power, or remedy under this Agreement preclude any other or further exercise of such right, privilege, power,
or remedy, or the exercise of any other right, privilege, power, or remedy. No notice to or demand on any Party in any case shall
entitle such Party to any other or further notice or demand in any similar or other circumstances or constitute a waiver of the
right of the Party giving such notice or making such demand to take any other or further action in any circumstances without notice
or demand.

 

SECTION 8. Section
Headings; Interpretation. Reference in this Agreement to a Section unless otherwise indicated, shall constitute references
to a Section or an Article of this Agreement. The section headings contained in this Agreement are for convenience of reference
only and do not form a part thereof and shall not affect in any way the meaning or interpretation of this Agreement. The Parties
hereto agree that this Agreement is the product of negotiations among sophisticated Parties, all of whom were represented by counsel,
and each of whom had an opportunity to participate in, and did participate in the drafting of each provision hereto. Accordingly,
ambiguities in this Agreement, if any, shall not be construed strictly against any Party hereto but rather shall be given a fair
and reasonable construction without regard to the rule of contra proferentem.

 

SECTION 9. Governing
Law. This Agreement shall be governed by, and construed in accordance with, the laws of the State of Delaware applicable to
agreements made and to be performed entirely within the State of Delaware without giving effect to the laws that might otherwise
govern under applicable principles of conflict of laws thereof.

 

SECTION 10. Notices.
Any notice, demand, claim, request, waiver or consent or other communication required or permitted to be given under the provisions
of this Agreement shall be in writing and shall be deemed to have been duly delivered if delivered by any of the following means
of delivery, and shall be deemed to have been duly delivered and received on the date (or the next Business Day if delivery is
not made on a Business Day) of personal delivery or facsimile transmission or on the date (or the next Business Day if delivery
is not made on a Business Day) of receipt, if mailed by registered or certified mail, postage prepaid and return receipt requested,
or on the date (or the next Business Day if delivery is not made on a Business Day) of a stamped receipt, if sent by an overnight
delivery service, and sent to the following addresses (or to such other address as any Party may request, in the case of the Company,
by notifying Mr. Sample, and in the case of Mr. Sample, by notifying the Company in each case in accordance with this Section):

 

	 	(a)	 	If to the Company: 

 

	 	  	 	
        Acacia Diversified Holdings, Inc.

        ATTN: Richard K. Pertile, CEO
	 
	 	 	 	
        13575 58TH Street North #138

        Clearwater, FL 33760
	 

 

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	 	  	 	Telephone: (727) 492-4208 

	 	  	 	Facsimile: (727) 678 - 4420 

 

With a copy to:

 

Howard P. Ross, Esq. B.C.S.

Florida Bar Certified in Business Litigation
and Civil Trial

Battaglia, Ross, Dicus & McQuaid, P.A.

5858 Central Avenue

St. Petersburg, FL 33707

 

	 	(b)	 	If to Mr. Sample: 

 

	 	  	 	
        Steven L. Sample

        2806 SE 29th Street

        Ocala, FL 34471

        Telephone: (877) 513-6294

        Facsimile: (877) 513-6295

  

SECTION 11. Consent
to Jurisdiction. Each of the Parties agrees to submit itself to the jurisdiction of any state or federal court sitting in Ocala,
Florida or Orlando, Florida. In addition, each of the Parties hereto agrees that it will not attempt to deny or defeat such personal
jurisdiction by motion or other request for leave from any such court, and that it will not bring any action relating to this Agreement
or any of the transactions contemplated by this Agreement in any court other than such court.

 

SECTION 12. Severability.
The Parties agree that (i) the provisions of this Agreement shall be severable in the event that any of the provisions hereof are
held by a court of competent jurisdiction to be invalid, void or otherwise unenforceable, (ii) they shall negotiate in good faith
to replace any provisions that are finally determined to be invalid, void or otherwise unenforceable with other provisions that
are as similar as possible in terms to such invalid, void or otherwise unenforceable provisions but are valid and enforceable,
and (iii) the balance of this Agreement shall not be affected and shall remain enforceable to the fullest extent permitted by law.
Whenever possible, each provision of this Agreement shall be interpreted in such a manner as to be valid and shall be enforced
to the fullest extent permitted by law.

 

SECTION 13. Counterparts.
This Agreement may be executed in one or more counterparts, each of which when executed and delivered shall be deemed an original,
and all of which when taken together shall be considered one and the same instrument, and this Agreement shall become effective
when such counterparts have been signed by each of the Parties hereto and delivered to the other Parties. The Parties hereto agree
that signatures of the Parties and their duly authorized officers may be exchanged by facsimile transmission, and that such signatures
shall be binding to the same extent, and have the same force and effect, as the exchange of original written signatures.

 

[Signature page follows]

 

 

 

 

 

 

 

5

 

 

 

 

 

This Agreement has been
duly executed by the Parties hereto as of the date first set forth above.

 

 

	 	 	 	ACACIA DIVERSIFIED
HOLDINGS, INC.
	 	 	 	A Texas corporation
	 	 	 	 
	 	BY:	 	/s/ Steven L. Sample
	 	 	 	 
	 	Name:	 	Steven L. Sample
	 	 	 	 
	 	Its:	 	CEO
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	STEVEN L. SAMPLE
	 	 	 	An Individual residing in Florida
	 	 	 	 
	 	BY:	 	/s/ Steven L. Sample
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	ACKNOWLEDGED AND AGREED BY RICHARD K. PERTILE
AS REPRESENTING SELLER AND ACTING IN THE CAPACITY AS CHIEF EXECUTIVE OFFICER-ELECT OF ACACIA FOR THE CONFIRMATION OF
AND AFFIRMATION OF THE VALIDITY OF THIS AGREEMENT UNDER AUTHORITY OF THE RESPECTIVE BOARDS OF DIRECTORS
	 	 	 	 
	 	BY:	 	/s/ Richard K. Pertile
	 	 	 	 
	 	Name:	 	Richard K. PertileNon-Competition Agreement

 

This Non-Competition And Restrictive Covenant
Agreement (this “Agreement”), is made and entered into as of January 15, 2016, with an effective date (the
“Effective Date”) of January 4, 2016 between Acacia Diversified Holdings, Inc., a Texas corporation (together
with its subsidiaries and affiliates, “Acacia” or the “Company”), and Richard K. Pertile,
a Florida resident (“Pertile”).

 

WHEREAS, the
execution and delivery of this Agreement by the Company and Pertile is a condition to the closing of the transaction contemplated
by the Asset Purchase Agreement dated as of the date hereof, by and among the Company (as “Buyer”) and the MariJ
Group (as “Seller”) (the “Purchase Agreement”).

 

WHEREAS, Pertile
has acquired, through his ownership and management of the MariJ Group and his relationship as a director, officer and/or employee
thereof, intimate knowledge regarding the business, customers, suppliers, information and processes of or relating to the Seller.

 

WHEREAS, Pertile
will benefit from the closing of the transactions contemplated in the Purchase Agreement, which benefits constitute adequate and
sufficient consideration for the covenants and obligations made in this Agreement.

 

WHEREAS, Pertile
and the Company desire to enter into this Agreement on the terms and conditions hereafter set forth.

 

NOW THEREFORE, in
consideration of the covenants and promises contained herein, and given pursuant to the Purchase Agreement, the parties hereto
agree as follows:

 

1.     
ACKNOWLEDGEMENT; INCORPORATION OF RECITALS. Pertile hereby acknowledges
receipt of adequate and sufficient consideration from the Company for the covenants and agreements made in this Agreement. The
recitals set forth above are, by this reference, incorporated into and deemed a part of this Agreement.

2.     
NON-COMPETE AND NON-SOLICITATION

(a)               
Non-Competition. During the Restricted Term, Pertile agrees that neither he
nor any of his Related Persons will, in any manner, anywhere in the Restricted Territory, directly or indirectly, on behalf of
himself or any other Person other than the Company, invest in, own, manage, operate, finance, control, advise, render services
to or guarantee the obligations of any Person engaged in or planning to become engaged in the Business as hereafter defined (“Business”).

(b)              
Non-Solicitation. During the Restricted Term, Pertile agrees that neither he
nor his Related Persons, in any manner, anywhere in the Restricted Territory, directly or indirectly, on behalf of himself or any
other Person will (i) solicit the business of any Person who is a customer or demonstrably identified potential customer of the
Seller or the Company (individually and collectively the “Joint Parties”) for the products or services then
provided or sold by the Joint Parties in any manner that could be likely to result in such Person curtailing or canceling any business
or contracts that such Person has or may come to have with the Joint Parties or in any way interfere with the relationship between
the Joint Parties and such Person; (ii) cause,

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induce or attempt to cause or induce any actual or potential customer, supplier,
employee, consultant or other business relation of the Joint Parties to cease doing business with the Company, to deal with any
competitor of the Company, or in any way interfere with its relationship with the Company; or (iii) hire, employ, engage, retain
or attempt to hire, employ, engage or retain any employee or independent contractor of the Company or in any way interfere with
the relationship between the Company and any of its employees or independent contractors.

3.     
CONFIDENTIAL INFORMATION.

(a)               
Confidential Information; Restriction. Pertile recognizes and acknowledges that
certain assets of the Joint Parties, including without limitation information regarding customers, pricing policies, methods of
operation, proprietary computer programs, sales, products, profits, costs, markets, key personnel, formulae, product applications,
technical processes, potential acquisition or joint venture candidates and trade secrets which may have been made available to
Pertile, whether in writing, in computer form, reduced to a tangible form in any medium, or conveyed orally, and which gives the
Company a competitive advantage over other individuals or companies which do not have access to this information (hereinafter called
“Confidential Information”) are valuable, special, and unique assets of the Company. Pertile acknowledges that
the Company is the owner of the Confidential Information and agrees not to dispute, contest or deny any such ownership rights of
the Company. Pertile shall not use, divulge, reproduce, distribute, reverse engineer or disclose (in any way or in any manner)
any Confidential Information to any person, firm, corporation, association, or any other entity for any reason or purpose whatsoever,
directly or indirectly, except as may be required by law, unless and until such Confidential Information becomes publicly available
other than as a consequence of the breach by Pertile of his confidentiality obligations hereunder. Pertile agrees to take all reasonable
precautions to prevent the inadvertent disclosure of the Confidential Information to any unauthorized person; agrees not to transport
or cause to be transported the Confidential Information outside the premises of the Company, except as necessary or desired to
carry out Pertile’s duties as prescribed by the Company; agrees not, without the Company’s express authorization, to
participate directly or indirectly in the development, marketing, sale, licensing or other exploitation of software or other products
or services which embody or are derived from Confidential Information; and agrees that in the event Pertile becomes aware that
any Person is taking or threatens to take any action which would compromise the Confidential Information or violate any of the
foregoing provisions were that Person subject to the provisions of this Section 3, promptly advise the Company of all facts
concerning such action or threatened action. Pertile expressly agrees that the disclosures prohibited hereby include disclosure
of similarities or possible similarities between the Confidential Information and the work product of another person or company.

(b)              
Protective Order. In the event that Pertile is required to disclose any Confidential
Information pursuant to an order, regulation, ruling, governmental request, summons or subpoena, Pertile shall promptly notify
the Company of such pending disclosure and reasonably cooperate in assisting the Company (at the Company’s expense) in seeking
a protective order or in objecting to such request, summons or subpoena with regard to the Confidential Information.

(c)               
Cooperation. Pertile agrees to reasonably cooperate with the Company in the
prosecution or defense of all threatened claims or actual litigation in which the Company is or may become a party, whether now
pending or hereafter brought, in which Pertile has knowledge of relevant facts or issues. Pertile shall be

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promptly
reimbursed reasonable out-of-pocket expenses incurred by him due to his cooperating with the prosecution or defense of any litigation
for the Company as applicable, including but not limited to reasonable attorney’s fees incurred in the furtherance of those
actions, provided that he provides the Company with reasonable documentation of such expenses.

4.     
ASSIGNMENT. Pertile hereby assigns
and transfers to the Company any right, title or interest in any inventions, designs, discoveries, works of authorship, creations,
ideas, developments, improvements, trade secrets (including, without limitation, trade secrets relating to the cannabis oil processing
and extraction systems) or software relating to the Business (collectively, “Inventions”), that Pertile may
have as of the date hereof or may have acquired on or before the date hereof, in whole or in part. This obligation is limited to
any Inventions that relate to the Company’s Business or demonstrably anticipated business, whether or not the Inventions
were created, originated, developed or conceived of by Pertile solely or jointly with others and whether or not the Inventions
are protected or protectable under applicable patent, trademark, service mark, copyright or trade secret laws. Pertile hereby transfers
Pertile’s rights in such Inventions free of all encumbrances and restrictions, and will promptly take any action, including
executing and delivering any documentation, deemed necessary by the Company to effectuate the transfer or prosecution of ownership
rights in the United States and any other country as the Company may request. Pertile acknowledges and agrees that the Inventions
will be considered part of the Confidential Information.

5.     
INJUNCTIVE RELIEF; REMEDIES. Pertile
acknowledges and agrees that any breach or threatened breach by Pertile of Section 2, Section 3 or Section 4 of this Agreement
will cause irreparable harm and continuing damages to the Company and that the remedy at law for any such breach or threatened
breach will be inadequate. Accordingly, in addition to any other remedies that may be available to the Company at law or in equity
in such event, the Company shall be entitled to seek and obtain, from any court of competent jurisdiction, an injunction or injunctions,
without bond or other security and without having to show that money damages will be inadequate or impossible to determine, enjoining
and restricting the breach or threatened breach. Pertile acknowledges, however, that no specification in this Agreement of a specific
legal or equitable remedy may be construed as a waiver of or prohibition against pursuing other legal or equitable remedies in
the event of a breach of this Agreement by Pertile.

6.     
SEVERABILITY AND JUDICIAL MODIFICATION.
If any clause, term or provision of this Agreement or the application thereof to any person or circumstance shall to any extent
be held invalid or unenforceable, the remainder of this Agreement and the application of such clause, term or provision to persons
or circumstances other than those to which it is invalid and unenforceable, shall not be affected thereby, and each clause, term
and provision of this Agreement shall be valid and be enforced to the fullest extent permitted by law. If any court of competent
jurisdiction refuses to enforce any clause, term, or provision of this Agreement as written, the other clauses, terms, and provisions
shall stand, and the court shall modify the clause, term, or provision at issue to the minimum extent necessary to make it enforceable
under applicable law, and shall enforce it as so modified.

7.     
GENERAL.

(a)               
Waivers. No delay or omission by either party hereto in exercising any right,
power or privilege hereunder shall impair such right, power or privilege, nor shall any single or partial exercise of any such
right, power or privilege preclude any further exercise thereof or the exercise of any other right, power or privilege. No waiver
of any provision of this Agreement shall in any event be effective unless the same shall be in

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writing, executed by the party against
whom enforcement of such waiver is sought, and any waiver so given shall be effective only in the specific instance and for the
specific purpose for which given.

(b)              
Counterparts. This Agreement may be executed in multiple counterparts, each
of which shall be deemed an original but all of which together shall constitute one and the same instrument. The parties may deliver
an executed copy of this Agreement or any other document contemplated by this Agreement by facsimile or other electronic transmission
to the other parties, and such delivery will have the same force and effect as the delivery of an original signed copy of this
Agreement or such other document. 

(c)               
Governing Law; Waiver of Jury Trial. This Agreement shall be construed in accordance
with and governed by the laws of the State of Florida applicable to agreements made and to be performed wholly within such jurisdiction,
without regard to principles of conflicts of laws. Each of the parties hereto hereby irrevocably and unconditionally waives any
and all right to trial by jury of any claim or cause of action in any suit arising out of or related to this Agreement or the transactions
or events contemplated hereby or any course of conduct, course of dealing, statements (whether verbal or written) or actions of
any party hereto. The parties hereto each agree that any and all such claims and causes of action shall be tried by the court without
a jury. Each of the parties hereto further waives any right to seek to consolidate any such lawsuit in which a jury trial has been
waived with any other lawsuit in which a jury trial cannot or has not been waived.

(d)              
No Strict Construction. The language used in this Agreement will be deemed to
be the language chosen by Pertile and the Company to express their mutual intent, and no rule of strict construction will be applied
against Pertile or the Company.

(e)               
Headings. The section and subsection heading of this Agreement are included
for purposes of convenience only, and shall not affect the construction or interpretation of any of its provisions.

8.     
DEFINITIONS. For purposes of this Agreement, the following definitions
shall apply:

“Business”
means any business the same or similar to that of the Company, including but not limited to the business of growing, cultivating,
managing, acquiring, processing, or selling industrial or medical grade hemp or cannabis or oils extracted therefrom; processing,
combining packaging, transporting or selling the extracted oils or medications, dietary supplements, pharmaceuticals or nutraceuticals
derived therefrom; transporting products, cash or persons for hire or for internal use; and all related processes, systems and
technology.  

“Control”
of an entity includes service as a director, officer, partner, manager, executor or trustee (or in a similar capacity) or beneficial
ownership of 10% or more of the outstanding equity (or the right to vote or receive profits, dividends or distributions).

“Person”
means an individual, partnership, corporation, business trust, limited liability company, limited liability partnership, joint
stock company, trust, unincorporated organization, association, joint venture or other entity or a governmental body.

4

 

“Related
Person”

(a)               
in the case of a natural person, each member of such Person’s immediate family, by blood or by marriage, including
spouses, parents, step-parents, siblings, children, and step-children;

(b)              
any Person that, directly or indirectly Controls, is Controlled by or is under common Control with, a Person.

“Restricted
Term” means the period commencing on the date hereof and ending five (5) years thereafter.

“Restricted
Territory” means anywhere within 125 miles of any location the Company or any of its subsidiaries does business..

IN WITNESS WHEREOF, and intending
to be legally bound hereby, the parties hereto have caused this Non-Compete and Restrictive Covenant Agreement to be duly executed
as of the date and year first above written.

[Signature page follows]

 

 

 

 

 

 

 

5

 

 

 

ACACIA DIVERSIFIED HOLDINGS, INC.

By:/s/ Steven L. Sample

Name: Steven L. Sample

Its: CEO

 

RICHARD K. PERTILE

/s/ Richard K. Pertile

Richard K. Pertile

     Address:       13575 58th St N. #138

Clearwater, Florida 33760

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