Document:

Document

Exhibit 10.27

FOURTH EXCHANGE AGREEMENT
This Fourth Exchange Agreement (the “Agreement”) is entered into as of the 10th day of November, 2020, by and among KushCo Holdings, Inc., a Nevada corporation with offices located at 6261 Katella Avenue, Suite 250, Cypress, CA 90630 (the “Company”) and the investor signatory hereto (the “Holder”), with reference to the following facts: 
A.Prior to the date hereof, pursuant to that Securities Purchase Agreement, dated as of April 29, 2019, by and between the Company and the investors party thereto (as the same has been amended, restated, amended and restated, supplemented or otherwise modified prior to the date hereof, the “Securities Purchase Agreement”), the Company issued a senior note (as the same has been amended, restated, amended and restated, supplemented or otherwise modified prior to the date hereof, the “Original Note”) to the Holder, as the initial holder.  
B.Prior to the date hereof, pursuant to that certain Exchange Agreement, dated August 21, 2019 (the “First Exchange Agreement”), the Company exchanged the Original Note for a new senior note (the “First Exchange Note”) and a warrant to purchase Common Stock of the Company (the “Existing Warrant”).
C.Prior to the date hereof, pursuant to that certain Exchange Agreement, dated November 8, 2019 (the “Second Exchange Agreement”), the Company exchanged the First Exchange Note for a new senior note in the principal amount of $23,962,500 (the “Second Exchange Note”).  
D.Prior to the date hereof, pursuant to that certain Exchange Agreement, dated June 9, 2020 (the “Third Exchange Agreement”), the Company exchanged the Second Exchange Note for (i) a new senior note in the aggregate principal amount of $22.0 million (the “Third Exchange Note”, and together with the Securities Purchase Agreement, the First Exchange Agreement, the Second Exchange Agreement, and the Third Exchange Agreement, the “Existing Note Documents”) and (ii) 5,347,594 shares of the Company’s common stock, par value $0.001 per share (the “Common Stock”).  
E.Capitalized terms used but not otherwise defined herein shall have the meanings as set forth in the Third Exchange Agreement (as amended hereby) or, as the context may require, the Existing Note.
F.The Holder is the holder of the Existing Note issued under the Third Exchange Agreement and has not assigned, transferred or exchanged the Existing Note.
G.Prior to the date of the Agreement, KIM International Corporation, an Affiliate of the Company incurred a $1,900,000 unsecured, non-recourse “Paycheck Protection Program” loan from The Bennington State Bank  under the Coronavirus Aid, Relief, and Economic Security (CARES) Act of 2020 (such loan, the “PPP Loan”, and the date thereof, the “PPP Loan Date”).
H.The Company and the Holder desire to amend and waive certain provisions of the Existing Note Documents and to permit the Transaction (as defined below) and to waive any prospective defaults or events of default that would have otherwise resulted 
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Exhibit 10.27

therefrom (the “Prospective Defaults”) on the terms and subject to the conditions set forth herein. References herein to the “Exchange” or the “Transaction” shall mean the exchange of the Existing Note, for (x) a new senior note with an amount due at maturity as set forth on the signature page of the Holder attached hereto, in the form attached hereto as Exhibit A (the “New Note”), and (y) such aggregate number of shares of Common Stock as set forth on the signature page of the Holder attached hereto (the “New Shares”, and together with the New Note, the “New Securities”).
I.The New Securities and this Agreement and such other documents and certificates related thereto are collectively referred to herein as the “Exchange Documents”.
J.The Exchange is being made in reliance upon the exemption from registration provided by Section 4(a)(2) and Rule 144(d)(3)(ii) of the Securities Act of 1933, as amended (the “Securities Act”).
NOW, THEREFORE, in consideration of the foregoing premises and the mutual covenants hereinafter contained, the parties hereto agree as follows:
1.Exchange.  On the Closing Date (as defined below), subject to the terms and conditions of this Agreement, pursuant to Section 4(a)(2) and Rule 144(d)(3)(ii) of the Securities Act, the Holder shall convey, assign and transfer the Existing Note to the Company in exchange for which the Company shall (a) issue the New Note to the Holder and (b) issue the New Shares to the Holder by deposit/withdrawal at custodian in accordance with the DWAC instructions on the signature page of the Holder, which New Shares shall be issued without restricted legend and shall be freely tradable by the Holder.  On the Closing Date, the Company shall deliver or cause to be delivered to the Holder (or its designee) the New Note at the address for delivery set forth on the signature page of the Holder attached hereto.  Immediately following the delivery of the New Securities to the Holder (or its designee), the Holder shall relinquish all rights, title and interest in the Existing Note (including any claims the Holder may have against the Company related thereto) and assign the same to the Company, and the Existing Note shall be deemed canceled.
2.Ratifications; Incorporation of Terms under Transaction Documents. 
2.2Ratifications.  Except as otherwise expressly provided herein, the Securities Purchase Agreement and each other Transaction Document, is, and shall continue to be, in full force and effect and is hereby ratified and confirmed in all respects, except that on and after the date hereof: (i) all references in the Securities Purchase Agreement to “this Agreement”, “hereto”, “hereof”, “hereunder” or words of like import referring to the Securities Purchase Agreement shall mean the Securities Purchase Agreement as amended by this Agreement, and (ii) all references in the other Transaction Documents to the “Securities Purchase Agreement”, “thereto”, “thereof”, “thereunder” or words of like import referring to the Securities Purchase Agreement shall mean the Securities Purchase Agreement as amended by this Agreement.   
2.2Amendments and Incorporation of Terms under Transaction Documents.  Effective as of the date hereof, the Securities Purchase Agreement and each of the other Transaction Documents are hereby amended as follows (and any such agreements, covenants and 
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Exhibit 10.27

related provisions therein shall be deemed incorporated by reference herein, mutatis mutandis, as amended as such):
(a)   The defined term “Notes” is hereby amended to mean the New Note (as defined herein). 
(b)    The defined term “Transaction Documents” is hereby amended to include this Agreement and the other Exchange Documents.
(c)    The defined term “Business Day” is hereby amended and restated as the Business Day (as defined in the New Note).
2.3Amendment of First Exchange Agreement; Acknowledgement.  Effective as of the Closing Date, Section 17 of the First Exchange Agreement is hereby amended to replace “New Note” with New Note (as defined herein).  The Company hereby acknowledges and agrees that, after giving effect to the foregoing amendment, the MFN Termination Date (as defined in the First Exchange Agreement) shall not occur until such dates as no New Note (as defined herein) remains outstanding.
3.Limited Waiver.  The Holder hereby waives the Prospective Defaults and any and all restrictions and remedies set forth in any Existing Note Document that would otherwise prohibit the Transaction or any other transactions contemplated by the Exchange Documents (as defined herein), solely as necessary to permit the transactions contemplated in the Exchange Documents (as defined herein) and not with respect to any other matter.  Effective as of the time immediately prior to the PPP Loan Date, the Holder waives any prohibitions in the Transaction Documents that would otherwise prohibit the PPP Loan and any Prospective Defaults (and, for the avoidance of doubt, the PPP Loan shall on and after the PPP Loan Date be deemed to be “Permitted Senior Indebtedness” thereunder).
4.Company Representations and Warranties.  As of the date hereof and as of the Closing Date (as defined below): 
4.1Each of the Company and each of its Subsidiaries are entities duly organized and validly existing and in good standing under the laws of the jurisdiction in which they are formed, and have the requisite power and authority to own their properties and to carry on their business as now being conducted and as presently proposed to be conducted.  Each of the Company and each of its Subsidiaries is duly qualified as a foreign entity to do business and is in good standing in every jurisdiction in which the character of the properties owned or leased by it or the nature of the business conducted by it makes such qualification necessary, except to the extent that the failure to be so qualified or be in good standing would not reasonably be expected to have a Material Adverse Effect (as defined below).  As used in this Agreement (including, for the avoidance of doubt, the New Notes), “Material Adverse Effect” means any material adverse effect on (i) the business, properties, assets, liabilities, operations (including results thereof), condition (financial or otherwise) or prospects of the Company and its Subsidiaries, taken as a whole; provided, however, that solely for purposes of this clause (i), COVID-19, the declaration on March 13, 2020, of the national emergency relating to COVID-19 and related executive actions, legislative and regulatory measures, and the related impacts of the 
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foregoing on the Company and its Subsidiaries shall not constitute a material adverse effect on the business, properties, assets, liabilities, operations (including results thereof), condition (financial or otherwise) or prospects of the Company and its Subsidiaries, taken as a whole, (ii) the transactions contemplated hereby or in any of the other Exchange Documents or any other agreements or instruments to be entered into in connection herewith or therewith or (iii) the authority or ability of the Company or any of its Subsidiaries to perform any of their respective obligations under any of the Exchange Documents.  Other than the Persons set forth on Schedule 4.1, the Company has no Subsidiaries.  
4.2Authorization and Binding Obligation.  The Company has the requisite power and authority to enter into and perform its obligations under this Agreement, the New Securities and each of the other agreements entered into by the parties hereto in connection with the transactions contemplated by the Exchange Documents and to consummate the Transaction (including, without limitation, the issuance of the New Securities in accordance with the terms hereof and thereof).  As of the Closing Date, the execution and delivery of the Exchange Documents by the Company and the consummation by the Company of the transactions contemplated hereby and thereby, including, without limitation, the issuance of the New Securities will have been duly authorized by the Company’s Board of Directors (or a duly authorized committee thereof) and no further filing, consent, or authorization will be required by the Company, its Board of Directors or its shareholders (other than such filings as may be required by any federal or state securities laws, rules or regulations).  This Agreement has been and, as of the Closing Date, the other Exchange Documents to which the Company is a party will have been, duly executed and delivered by the Company, and constitute or will constitute, as applicable, the legal, valid and binding obligations of the Company, enforceable against the Company in accordance with their respective terms, except as such enforceability may be limited by general principles of equity or applicable bankruptcy, insolvency, reorganization, moratorium, liquidation or similar laws relating to, or affecting generally, the enforcement of applicable creditors’ rights and remedies and except as rights to indemnification and to contribution may be limited by federal or state securities laws.
4.3No Conflict.  Except for any waivers referred to in Section 3 above, the execution, delivery and performance of the Exchange Documents by the Company and the consummation by the Company of the transactions contemplated hereby and thereby (including, without limitation, the issuance of the New Securities) will not (i) result in a violation of the Articles of Incorporation (as defined below) or any other organizational documents of the Company or any of its Subsidiaries, any capital stock of the Company or any of its Subsidiaries or Bylaws (as defined below) of the Company or any of its Subsidiaries, (ii) conflict with, or constitute a default (or an event which with notice or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture or instrument to which the Company or any of its Subsidiaries is a party and the receipt by the Company of the Required Consents (as defined below), or (iii) result in a violation of any law, rule, regulation, order, judgment or decree (including foreign, federal and state securities laws and regulations and the rules and regulations of the OTCQX (the “Principal Market”) and including all applicable federal laws, rules and regulations) applicable to the Company or any of its Subsidiaries or by which any property or asset of the Company or any of its Subsidiaries is bound or affected except, in the case of clause 
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Exhibit 10.27

(ii) or (iii) above, to the extent such violations that would not reasonably be expected to have a Material Adverse Effect.
4.4No Consents.  Except as set forth on Schedule 4.4 (the “Required Consents”), neither the Company nor any Subsidiary is required to obtain any consent from, authorization or order of, or make any filing or registration with (other than such filings as may be required by any federal or state securities laws, rules or regulations), any Governmental Entity or any regulatory or self-regulatory agency or any other Person in order for it to execute, deliver or perform any of its respective obligations under or contemplated by the Exchange Documents, in each case, in accordance with the terms hereof or thereof.  All consents, authorizations, orders, filings and registrations which the Company or any Subsidiary is required to obtain pursuant to the preceding sentence have been or will be obtained or effected on or prior to the Closing Date, and neither the Company nor any of its Subsidiaries are aware of any facts or circumstances which might prevent the Company or any of its Subsidiaries from obtaining or effecting any of the registration, application or filings contemplated by the Exchange Documents.  
4.5Securities Law Exemptions.  Assuming the accuracy of the representations and warranties of the Holder contained herein, the offer and issuance by the Company of the New Securities is exempt from registration under the Securities Act pursuant to the exemption provided by Section 4(a)(2) and Rule 144(d)(3)(ii) thereof.  
4.6Status of Existing Note; Issuance of New Securities.  
(a)    The Company has no knowledge that the Existing Note is subject to dispute and to the knowledge of the Company there is no action based on the Existing Note that is currently pending in any court or other legal venue and to the knowledge of the Company no judgments based upon the Existing Note have been previously entered in any legal proceeding.  The Company has not received any written notice from the Holder or any other person challenging or disputing the Existing Note, or any portion thereof, and prior to the Exchange, the Company is unconditionally obligated to pay the entire aggregate principal amount outstanding under the Existing Note (and any accrued and unpaid interest thereunder) without defense, counterclaim or offset.  Upon the Exchange, the Company is unconditionally obligated to pay the entire aggregate principal amount outstanding under the New Note (and any accrued and unpaid interest thereunder) without defense, counterclaim or offset.
(b)    As of the Closing Date, (i) the issuance of the New Note will be duly authorized and upon issuance in accordance with the terms of the Exchange Documents shall be validly issued, fully paid and non-assessable and free from all Liens (as defined in the New Note) and (ii) upon issuance in accordance herewith, the New Shares will be validly issued, fully paid and nonassessable and free from all Liens with respect to the issue thereof, with the holders being entitled to all rights accorded to a holder of Common Stock.  By virtue of Section 4(a)(2) and Rule 144(d)(3)(ii) under the Securities Act, the New Securities will have a Rule 144 (as defined below) holding period that will be deemed to have commenced as of the Closing Date (as defined in the Securities Purchase Agreement), the date of the original issuance of the Original Note to the Holder.  At any time on and after the date hereof and subject to the Holder’s representations and warranties contained in Section 5 of this Agreement, neither the New Note nor the New Shares shall be required to bear any restrictive legend and shall be freely 
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Exhibit 10.27

transferable by the Holder pursuant to and in accordance with Rule 144 of the Securities Act (“Rule 144”), provided, for the avoidance of doubt, that the Holder shall not be an affiliate of the Company and shall not have been an affiliate during the 90 days preceding the date of any transfer. 
4.7Transfer Taxes.  On the Closing Date, all share transfer or other taxes (other than income or similar taxes) that are required to be paid in connection with the issuance of the New Note to be issued to the Holder hereunder will be, or will have been, fully paid or provided for by the Company, and all laws imposing such taxes will be or will have been complied with.
4.8Conduct of Business; Regulatory Permits.  Neither the Company nor any of its Subsidiaries is in material violation of any term of or in default under its Articles of Incorporation, any certificate of designation, preferences or rights of any other outstanding series of preferred stock of the Company or any of its Subsidiaries or Bylaws or their organizational charter, certificate of formation, memorandum of association, articles of association, Articles of Incorporation or certificate of incorporation or bylaws, respectively.  Neither the Company nor any of its Subsidiaries is in material violation of any judgment, decree or order or any statute, ordinance, rule or regulation applicable to the Company or any of its Subsidiaries, and neither the Company nor any of its Subsidiaries will conduct its business in violation of any of the foregoing, except in all cases for possible violations which would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.  Without limiting the generality of the foregoing, except as set forth in the SEC Documents, the Company is not in material violation of any of the rules, regulations or requirements of the Principal Market and has no knowledge of any facts or circumstances that could reasonably lead to delisting or suspension of the Common Stock by the Principal Market in the foreseeable future.  Except as set forth in SEC Documents, during the two years prior to the date hereof, (i) the Common Stock has been listed or designated for quotation on the Principal Market, (ii) trading in the Common Stock has not been suspended by the Securities and Exchange Commission (“SEC”) or the Principal Market and (iii) the Company has received no communication, written or oral, from the SEC or the Principal Market regarding the suspension or delisting of the Common Stock from the Principal Market.  The Company and each of its Subsidiaries possess all certificates, authorizations and permits issued by the appropriate regulatory authorities necessary to conduct their respective businesses, except where the failure to possess such certificates, authorizations or permits would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, and neither the Company nor any such Subsidiary has received any notice of proceedings relating to the revocation or modification of any such certificate, authorization or permit.  There is no agreement, commitment, judgment, injunction, order or decree binding upon the Company or any of its Subsidiaries or to which the Company or any of its Subsidiaries is a party which has or would reasonably be expected to have the effect of prohibiting or materially impairing any business practice of the Company or any of its Subsidiaries, any acquisition of property by the Company or any of its Subsidiaries or the conduct of business by the Company or any of its Subsidiaries as currently conducted other than such effects, individually or in the aggregate, which have not had and would not reasonably be expected to have a Material Adverse Effect on the Company or any of its Subsidiaries.
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Exhibit 10.27

4.9Transactions With Affiliates.  Except as set forth in the SEC Documents or as set forth on Schedule 4.9, none of the officers or directors of the Company or its Subsidiaries and, to the knowledge of the Company, none of the employees of the Company or its Subsidiaries is presently a party to any transaction with the Company or any Subsidiary (other than for services as employees, officers and directors) required to be disclosed under Item 404 of Regulation S-K under the Exchange Act.
4.10Equity Capitalization.  
(a)    Definitions:  
i.“Common Stock” means (x) the Company’s shares of common stock, $0.0001 par value per share, and (y) any capital stock into which such common stock shall have been changed or any share capital resulting from a reclassification of such common stock.  
ii.“Preferred Stock” means (x) the Company’s blank check preferred stock, $0.0001 par value per share, the terms of which may be designated by the board of directors of the Company in a certificate of designations and (y) any capital stock into which such preferred stock shall have been changed or any share capital resulting from a reclassification of such preferred stock (other than a conversion of such preferred stock into Common Stock in accordance with the terms of such certificate of designations).  
b.Authorized and Outstanding Capital Stock.  As of the date hereof, the authorized capital stock of the Company consists of (A) 265,000,000 shares of Common Stock, of which 127,274,667 are issued and outstanding and 36,736,880 shares are reserved for issuance pursuant to Convertible Securities (as defined below) exercisable or exchangeable for, or convertible into, shares of Common Stock and (B) 10,000,000 shares of Preferred Stock, none of which are issued and outstanding.  No shares of Common Stock are held in the treasury of the Company.
c.Valid Issuance; Available Shares; Affiliates.  All of such outstanding shares are duly authorized and have been, or upon issuance will be, validly issued, fully paid and nonassessable.  The SEC Documents accurately set forth, as of the dates referred to therein, the number of shares of Common Stock that are (A) reserved for issuance pursuant to Convertible Securities (as defined below) and (B) that are, as of the date referred to therein, owned by Persons who are “affiliates” (as defined in Rule 405 of the Securities Act and calculated based on the assumption that only officers, directors and holders of at least 10% of the Company’s issued and outstanding Common Stock are “affiliates” without conceding that any such Persons are “affiliates” for purposes of federal securities laws) of the Company or any of its Subsidiaries.  “Convertible Securities” means any capital stock or other security of the Company or any of its Subsidiaries that is at any time and under any circumstances directly or indirectly convertible into, exercisable or exchangeable for, or which otherwise entitles the holder thereof to acquire, any capital stock or other security of the Company (including, without limitation, Common Stock) or any of its Subsidiaries.
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Exhibit 10.27

d.Existing Securities; Obligations.  Except as disclosed in the SEC Documents or on Schedule 4.10: (A) none of the Company’s or any Subsidiary’s shares, interests or capital stock is subject to preemptive rights or any other similar rights or Liens suffered or permitted by the Company or any Subsidiary; (B) there are no outstanding options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible into, or exercisable or exchangeable for, any shares, interests or capital stock of the Company or any of its Subsidiaries, or contracts, commitments, understandings or arrangements by which the Company or any of its Subsidiaries is or may become bound to issue additional shares, interests or capital stock of the Company or any of its Subsidiaries or options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities or rights convertible into, or exercisable or exchangeable for, any shares, interests or capital stock of the Company or any of its Subsidiaries; (C) there are no agreements or arrangements under which the Company or any of its Subsidiaries is obligated to register the sale of any of their securities under the Securities Act; (D) there are no outstanding securities or instruments of the Company or any of its Subsidiaries which contain any redemption or similar provisions, and there are no contracts, commitments, understandings or arrangements by which the Company or any of its Subsidiaries is or may become bound to redeem a security of the Company or any of its Subsidiaries; (E) neither the Company nor any Subsidiary has any stock appreciation rights or “phantom stock” plans or agreements or any similar plan or agreement; and   (F) there are no securities or instruments containing anti-dilution or similar provisions that will be triggered by the issuance of the New Note.
e.Organizational Documents.  True, correct and complete copies of the Company’s Articles of Incorporation, as amended and as in effect on the date hereof (the “Articles of Incorporation”), and the Company’s Bylaws, as in effect on the date hereof (the “Bylaws”), and the terms of all Convertible Securities and the material rights of the holders thereof in respect thereto, are set forth in, or filed as exhibits to, the SEC Documents, or otherwise set forth on Schedule 4.10. 
4.11Indebtedness and Other Contracts.  Except as disclosed in the SEC Documents or on Schedule 4.11, neither the Company nor any of its Subsidiaries, (i) has any outstanding debt securities, notes, credit agreements, credit facilities or other agreements, documents or instruments evidencing Indebtedness of the Company or any of its Subsidiaries or by which the Company or any of its Subsidiaries is or may become bound, (ii) is a party to any contract, agreement or instrument, the violation of which, or default under which, by the other party(ies) to such contract, agreement or instrument would reasonably be expected to result in a Material Adverse Effect, (iii) is in violation of any term of, or in default under, any contract, agreement or instrument relating to any Indebtedness, except where such violations and defaults would not reasonably be expected to result, individually or in the aggregate, in a Material Adverse Effect (other than the Notes and the Securities Purchase Agreement), or (iv) is a party to any contract, agreement or instrument relating to any Indebtedness, the performance of which, in the judgment of the Company’s officers, has or is expected to have a Material Adverse Effect.  Prior to the date hereof, the Company has repaid, in full, all of the outstanding obligations under the Current Facility (as defined in the Original Note) and no outstanding disputes exist between the lenders under the Current Facility and the Company or any of its Subsidiaries. 
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4.12Litigation.  Except as set forth in the SEC Documents, there is no action, claim, suit, investigation or proceeding before any Governmental Entity pending or, to the knowledge of the Company, threatened against the Company or its Subsidiaries wherein an unfavorable decision, ruling or finding would reasonably be expected to, individually or in the aggregate, (i) materially adversely affect the validity or enforceability of, or the authority or ability of the Company to perform its obligations under, the Exchange Documents or (ii) have a Material Adverse Effect.  The Company is not a party to or subject to the provisions of any injunction, judgment, decree or order of any court, regulatory body, administrative agency or other governmental agency or body that could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect. 
4.13No Consideration Paid.  No consideration, commission or other remuneration has been paid by the Holder to the Company, its Subsidiaries or any of their agents or affiliates in connection with the Exchange.
4.14Acknowledgement Regarding Holder’s Trading Activity.  It is understood and acknowledged by the Company that (i) following the public disclosure of the transactions contemplated by the Exchange Documents, in accordance with the terms thereof, the Holder has not been asked by the Company or any of its Subsidiaries to agree, nor has the Holder agreed with the Company or any of its Subsidiaries, to desist from effecting any transactions in or with respect to (including, without limitation, purchasing or selling, long and/or short) any securities of the Company, or “derivative” securities based on securities issued by the Company or to hold any of the New Securities for any specified term; (ii) the Holder, and counterparties in “derivative” transactions to which any the Holder is a party, directly or indirectly, presently may have a “short” position in the Common Stock which was established prior to the Holder’s knowledge of the transactions contemplated by the Exchange Documents; (iii) the Holder shall not be deemed to have any affiliation with or control over any arm’s length counterparty in any “derivative” transaction; and (iv) the Holder may rely on the Company’s obligation to timely deliver New Shares as and when required pursuant to the Exchange Documents for purposes of effecting trading in the Common Stock of the Company.  The Company acknowledges that such aforementioned hedging and/or trading activities do not constitute a breach of this Agreement, the New Note or any other Exchange Document or any of the documents executed in connection herewith or therewith. 
4.15Disclosure.  Except as disclosed in the SEC Filing (as defined below), the Company confirms that neither it nor any other Person acting on its behalf has provided the Holder or its agents or counsel with any information that constitutes or could reasonably be expected to constitute material, non-public information concerning the Company or any of its Subsidiaries, other than the existence of the transactions contemplated by this Agreement and the other Exchange Documents and any matters disclosed in the SEC Filing. A draft of the Annual Report on Form 10-K for the period ended August 31, 2020 of Company and its Subsidiaries provided by the Company to the Holder (or an affiliate of the Holder) on November 9, 2020 is true and correct and does not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements made therein, in the light of the circumstances under which they were made, not misleading. The Company understands and confirms that the Holder will rely on the foregoing representations in effecting transactions in securities of the Company.  
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5.Holder’s Representations and Warranties.  As a material inducement to the Company to enter into this Agreement and consummate the Exchange, the Holder hereby represents and warrants with and to the Company, as of the date hereof and as of the Closing Date, as follows: 
5.1Reliance on Exemptions.  The Holder understands that the New Securities are being offered and exchanged in reliance on specific exemptions from the registration requirements of United States federal and state securities laws and that the Company is relying in part upon the truth and accuracy of, and the Holder’s compliance with, the representations, warranties, agreements, acknowledgments and understandings of the Holder set forth herein and in the other Exchange Documents in order to determine the availability of such exemptions and the eligibility of the Holder to acquire the New Securities. 
5.2No Governmental Review.  The Holder understands that no United States federal or state agency or any other government or governmental agency has passed on or made any recommendation or endorsement of the New Securities or the fairness or suitability of the investment in the New Securities nor have such authorities passed upon or endorsed the merits of the offering of the New Securities.
5.3Validity; Enforcement.  This Agreement and the other Exchange Documents to which the Holder is a party have been duly and validly authorized, executed and delivered on behalf of the Holder and shall constitute the legal, valid and binding obligations of the Holder enforceable against the Holder in accordance with their respective terms, except as such enforceability may be limited by general principles of equity or to applicable bankruptcy, insolvency, reorganization, moratorium, liquidation and other similar laws relating to, or affecting generally, the enforcement of applicable creditors’ rights and remedies. 
5.4No Conflicts.  The execution, delivery and performance by the Holder of this Agreement and the other Exchange Documents to which the Holder is a party, and the consummation by the Holder of the transactions contemplated hereby and thereby will not (i) result in a violation of the organizational documents of the Holder or (ii) conflict with, or constitute a default (or an event which with notice or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture or instrument to which the Holder is a party, or (iii) result in a violation of any law, rule, regulation, order, judgment or decree (including federal and state securities laws) applicable to the Holder, except in the case of clauses (ii) and (iii) above, for such conflicts, defaults, rights or violations which would not, individually or in the aggregate, reasonably be expected to have a material adverse effect on the ability of the Holder to perform its obligations hereunder. 
5.5Investment Risk; Sophistication.  The Holder is acquiring the New Securities hereunder as principal for its own account and in the ordinary course of its business.  The Holder has such knowledge, sophistication, and experience in business and financial matters so as to be capable of evaluation of the merits and risks of the prospective investment in the New Securities, and has so evaluated the merits and risk of such investment, and can bear the economic risks of such investment. The Holder is an “accredited investor” as defined in Regulation D under the Securities Act. The Holder understands that no federal or state agency 
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has passed upon the merits or risks of an investment in the New Securities or made any finding or determination concerning the fairness or advisability of this investment.
5.6Ownership of Existing Note.  The Holder owns the Existing Note free and clear of any Liens (other than the obligations pursuant to this Agreement, the Transaction Documents and applicable securities laws) and has the requisite power and authority to enter into and perform its obligations under this Agreement and each of the other Exchange Documents to which it is a party and to consummate the Transaction.  
5.7Transfer or Resale.  The Holder understands that:  (i) the New Securities have not been and is not being registered under the Securities Act or any state securities laws, and may not be offered for sale, sold, assigned or transferred unless (A) subsequently registered thereunder, (B) the Holder shall have delivered to the Company (if requested by the Company) an opinion of counsel, in a form reasonably acceptable to the Company, to the effect that such New Securities to be sold, assigned or transferred may be sold, assigned or transferred pursuant to an exemption from such registration, or (C) the Holder provides the Company with reasonable assurance that such New Securities can be sold, assigned or transferred pursuant to Rule 144; (ii) any sale of the New Securities made in reliance on Rule 144 may be made only in accordance with the terms of Rule 144, and further, if Rule 144 is not applicable, any resale of the New Securities under circumstances in which the seller (or the Person through whom the sale is made) may be deemed to be an underwriter (as that term is defined in the Securities Act) may require compliance with some other exemption under the Securities Act or the rules and regulations of the SEC promulgated thereunder; and (iii) neither the Company nor any other Person is under any obligation to register the New Securities under the Securities Act or any state securities laws or to comply with the terms and conditions of any exemption thereunder.  Notwithstanding the foregoing, the New Securities may be pledged in connection with a bona fide margin account or other loan or financing arrangement secured by the New Securities and such pledge of New Securities shall not be deemed to be a transfer, sale or assignment of the New Securities hereunder, and the Holder effecting a pledge of New Securities shall not be required to provide the Company with any notice thereof or otherwise make any delivery to the Company pursuant to this Agreement or any other Exchange Document, including, without limitation, this Section 5.7.
6.Closing; Conditions.  Subject to the conditions set forth below, the Exchange shall take place at the offices of Kelley Drye & Warren LLP, 101 Park Avenue, New York, NY 10178, on the Business Day immediately following such date as the Company shall have satisfied all conditions to closing below, or at such other time and place as the Company and the Holder mutually agree (the “Closing” and the “Closing Date”). 
6.1Condition’s to Holder’s Obligations.  The obligation of the Holder to consummate the Exchange is subject to the fulfillment, to the Holder’s reasonable satisfaction, prior to or at the Closing, of each of the following conditions (unless waived by the Holder in writing, prior to the Closing):
a.Representations and Warranties; Covenants.  The representations and warranties of the Company contained in this Agreement shall be true and correct in all material respects (except for those representations and warranties that are qualified by materiality 
    11

Exhibit 10.27

or Material Adverse Effect, which are accurate in all respects) on the date hereof and on and as of the Closing Date as if made on and as of such date (except for representations and warranties that speak as of a specific date, which are accurate in all material respects (except for those representations and warranties that are qualified by materiality or Material Adverse Effect, which are accurate in all respects) as of such specified date).  The Company shall have performed, satisfied and complied in all respects with the covenants, agreements and conditions required to be performed, satisfied or complied with by the Company at or prior to the Closing Date.
b.Issuance of New Note.  At the Closing, the Company shall issue the New Note to the Holder.
c.No Actions.  No action, proceeding, investigation, regulation or legislation shall have been instituted, threatened or proposed before any court, governmental agency or authority or legislative body to enjoin, restrain, prohibit or obtain substantial damages in respect of, this Agreement or the consummation of the transactions contemplated by this Agreement.
d.Proceedings and Documents.  All proceedings in connection with the transactions contemplated hereby and all documents and instruments incident to such transactions shall be satisfactory in substance and form to the Holder, and the Holder shall have received all such counterpart originals or certified or other copies of such documents as they may reasonably request.
e.No Event of Default.  After giving effect to the Exchange, no Event of Default (as defined in the New Note) or event that with the passage of time or giving of notice would constitute an Event of Default shall have occurred and be continuing.
f.Consents.  The Company shall have obtained all governmental, regulatory or third party consents and approvals (or waiver of such consents or approvals), if any, necessary for the Exchange, including without limitation, those required by the Principal Market, if any, and the Required Consents.
g.Listing.  The Common Stock (A) shall be designated for quotation or listed (as applicable) on the Principal Market and (B) shall not have been suspended, as of the Closing Date, by the SEC or the Principal Market from trading on the Principal Market.
h.Fees.  The Company shall have paid, in full, to Kelley Drye & Warren LLP the Counsel Expense Amount (as defined below) and all outstanding invoices delivered by Kelley Drye & Warren LLP to the Company prior to the date hereof.
6.Condition’s to the Company’s Obligations.  The obligation of the Company to consummate the Exchange is subject to the fulfillment, to the Company’s reasonable satisfaction, prior to or at the Closing, of each of the following conditions (unless waived by the Company in writing, prior to the Closing):
a.Representations and Warranties.  The representations and warranties of the Holder contained in this Agreement shall be true and correct in all material respects (except for those representations and warranties that are qualified by materiality or 
    12

Exhibit 10.27

material adverse effect, which are accurate in all respects) on the date hereof and on and as of the Closing Date as if made on and as of such date (except for representations and warranties that speak as of a specific date, which are accurate in all material respects (except for those representations and warranties that are qualified by materiality or material adverse effect, which are accurate in all respects) as of such specified date). 
b.No Actions.  No action, proceeding, investigation, regulation or legislation shall have been instituted, threatened or proposed before any court, governmental agency or authority or legislative body to enjoin, restrain, prohibit, or obtain substantial damages in respect of, this Agreement or the consummation of the transactions contemplated by this Agreement.
c.Proceedings and Documents.  All proceedings in connection with the transactions contemplated hereby and all documents and instruments incident to such transactions shall be satisfactory in substance and form to the Company and the Company shall have received all such counterpart originals or certified or other copies of such documents as the Company may reasonably request.
7.Covenants.
7.1No Integration.  None of the Company, its Subsidiaries, any of their affiliates, or any Person acting on their behalf shall, directly or indirectly, make any offers or sales of any security (as defined in the Securities Act) or solicit any offers to buy any security or take any other actions, under circumstances that would require registration of the New Note under the Securities Act or cause this offering of the New Note to be integrated with such offering or any prior offerings by the Company for purposes of Regulation D under the Securities Act. 
7.2Fees.  At the closing, the Company shall pay Kelley Drye & Warren, LLP (counsel to the Holder) an amount of up to $5,000  for the reasonable and documented out-of-pocket legal fees and expenses incurred by the Holder in connection with the Transaction (the “Counsel Expense Amount”). The Company shall be responsible for the payment of any placement agent’s fees, financial advisory fees, transfer agent fees, any legal fees with respect to the issuance of any New Shares without restrictive legend, DTC (as defined below) fees or broker’s commissions (in each case other than for Persons engaged by the Holder) relating to or arising out of the transactions contemplated hereby.  The Company shall pay, and hold the Holder harmless against, any liability, loss or expense (including, without limitation, reasonable attorneys’ fees and out-of-pocket expenses) arising in connection with any claim relating to any such payment.  Except as otherwise set forth in the Exchange Documents, each party to this Agreement shall bear its own expenses in connection with the sale of the New Securities to the Holder.
7.3Holding Period.  For the purposes of Rule 144, the Company acknowledges that the holding period of the New Securities may be tacked onto both the holding period of the Existing Note, the holding period of the First Exchange Note and the holding period of the Original Note, and the Company agrees not to take a position contrary to this Section 7.3.  The Company acknowledges and agrees that, subject to the Holder’s representations 
    13

Exhibit 10.27

and warranties contained in Section 5 of this Agreement,  the New Securities shall not be required to bear any restrictive legend and shall be freely transferable by the Holder pursuant to and in accordance with Rule 144, provided, for the avoidance of doubt, that the Holder shall not be an affiliate of the Company and shall not have been an affiliate during the 90 days preceding the date of any transfer.
7.4Blue Sky.  The Company shall, on or before the Closing Date, take such action as the Company shall reasonably determine is necessary in order to obtain an exemption for, or to, qualify the New Securities for sale to the Holder at the Closing pursuant to this Agreement under applicable securities or “Blue Sky” laws of the states of the United States (or to obtain an exemption from such qualification), if any.  Without limiting any other obligation of the Company under this Agreement, the Company shall timely make all filings and reports relating to the offer and sale of the New Securities required under all applicable securities laws (including, without limitation, all applicable federal securities laws and all applicable “Blue Sky” laws), and the Company shall comply with all applicable foreign, federal, state and local laws, statutes, rules, regulations and the like relating to the offering and sale of the New Securities to the Holder.
7.5Reporting Status.  Until the date no New Notes remain outstanding (the “Reporting Period”), the Company shall timely file all reports required to be filed with the SEC pursuant to the 1934 Act, and the Company shall not terminate its status as an issuer required to file reports under the 1934 Act even if the 1934 Act or the rules and regulations thereunder would no longer require or otherwise permit such termination.
7.6Financial Information.  The Company agrees to send the following to any holder of the New Note (each, an “Investor”) during the Reporting Period (i) unless the following are filed with the SEC through EDGAR and are available to the public through the EDGAR system, within one (1) Business Day after the filing thereof with the SEC, a copy of its Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q, any interim reports or any consolidated balance sheets, income statements, stockholders’ equity statements and/or cash flow statements for any period other than annual, any Current Reports on Form 8-K and any registration statements (other than on Form S-8) or amendments filed pursuant to the Securities Act, (ii) unless the following are either filed with the SEC through EDGAR or are otherwise widely disseminated via a recognized news release service (such as PR Newswire), on the same day as the release thereof, facsimile copies of all press releases issued by the Company or any of its Subsidiaries and (iii) unless the following are filed with the SEC through EDGAR, copies of any notices and other information made available or given to the stockholders of the Company generally, contemporaneously with the making available or giving thereof to the stockholders. 
7.7Listing.  The Company shall promptly secure the listing or designation for quotation (as the case may be) of all of the New Shares upon each national securities exchange and automated quotation system, if any, upon which the Common Stock is then listed or designated for quotation (as the case may be) (subject to official notice of issuance) and shall maintain such listing or designation for quotation (as the case may be) of all New Shares from time to time issuable under the terms of the Exchange Documents on such national securities exchange or automated quotation system.  The Company shall maintain the Common Stock’s listing or authorization for quotation (as the case may be) on the Principal Market, The New 
    14

Exhibit 10.27

York Stock Exchange, the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market or the Nasdaq Global Select Market (each, an “Eligible Market”).  Neither the Company nor any of its Subsidiaries shall take any action which could be reasonably expected to result in the delisting or suspension of the Common Stock on an Eligible Market.  The Company shall pay all fees and expenses in connection with satisfying its obligations under this Section 7.7.
7.8Pledge of Securities.  Notwithstanding anything to the contrary contained in the Existing Note Documents nor the Exchange Documents, the Company acknowledges and agrees that the New Securities may be pledged by a holder of the New Securities without restriction in connection with a bona fide margin agreement or other loan or financing arrangement that is secured by the New Securities.  The Company hereby agrees to execute and deliver such documentation as a pledgee of the New Securities may reasonably request in connection with a pledge of the New Securities to such pledgee by the Holder, provided that such documentation does not expand the nature of the Company's obligations under any of the Existing Note Documents and the Exchange Documents.
7.9Disclosure of Transaction.  
a.On or before 9:30 a.m., New York time, on the first (1st) Business Day after the date of this Agreement, the Company shall file a Current Report on Form 8-K or any other periodic report filed pursuant to the Exchange Act (including all attachments, the “SEC Filing”) describing the material terms of the transactions contemplated by the Exchange Documents in the form required by the Exchange Act and attaching this Agreement and the form of the New Note.  From and after the filing of the SEC Filing, the Company shall have disclosed all material, non-public information (if any) provided to the Holder by the Company or any of its Subsidiaries or any of their respective officers, directors, employees or agents in connection with the transactions contemplated by the Exchange Documents.  In addition, effective upon the filing of the SEC Filing, the Company acknowledges and agrees that any and all confidentiality or similar obligations under any agreement, whether written or oral, between the Company, any of its Subsidiaries or any of their respective officers, directors, affiliates, employees or agents, on the one hand, and the Holder or any of its affiliates, on the other hand, relating to the transactions contemplated by the Exchange Documents, shall terminate.  
b.Except as may be required by the Securities Purchase Agreement or the New Note, the Company shall not, and the Company shall cause each of its Subsidiaries and each of its and their respective officers, directors, employees and agents not to, provide the Holder with any material, non-public information regarding the Company or any of its Subsidiaries from and after the date hereof without the express prior written consent of the Holder (which may be granted or withheld in the Holder’s sole discretion).  To the extent that the Company delivers any material, non-public information to the Holder without the Holder’s consent, other than as required by the Securities Purchase Agreement or the New Note, the Company hereby covenants and agrees that the Holder shall not have any duty of confidentiality with respect to such material, non-public information.  Subject to the foregoing, neither the Company, its Subsidiaries nor the Holder shall issue any press releases or any other public statements with respect to the transactions contemplated hereby; provided, however, the Company shall be entitled, without the prior approval of the Holder, to make any press release or other public disclosure with respect to such transactions (i) in substantial conformity with the 8-
    15

Exhibit 10.27

K Filing and (ii) as is required by applicable law and regulations.  Notwithstanding anything contained in this Agreement to the contrary and without implication that the contrary would otherwise be true, the Company expressly acknowledges and agrees that the Holder shall not have (unless expressly agreed to by the Holder after the date hereof in a written definitive and binding agreement executed by the Company and the Holder), any duty of confidentiality with respect to any material, non-public information regarding the Company or any of its Subsidiaries. 
7.10Additional Issuance of Securities.  The Company agrees that for the period commencing on the date hereof and ending on the date immediately following the 30th Trading Days after the Closing Date (the “Restricted Period”), neither the Company nor any of its Subsidiaries shall directly or indirectly issue, offer, sell, grant any option or right to purchase, or otherwise dispose of (or announce any issuance, offer, sale, grant of any option or right to purchase or other disposition of) any equity security or any equity-linked or related security (including, without limitation, any “equity security” (as that term is defined under Rule 405 promulgated under the Securities Act), any Convertible Securities (as defined below), any preferred stock or any purchase rights) (any such issuance, offer, sale, grant, disposition or announcement (whether occurring during the Restricted Period or at any time thereafter) is referred to as a “Subsequent Placement”).  Notwithstanding the foregoing, this Section 7.10 shall not apply in respect of the issuance of (i) shares of Common Stock, restricted shares of Common Stock, restricted stock units or standard stock options to purchase Common Stock or other standard equity linked securities to directors, officers or employees of the Company in their capacity as such pursuant to an Approved Stock Plan (as defined below), provided that (1) all such issuances (taking into account the shares of Common Stock issuable upon exercise of such options or vesting of restricted stock or restricted stock units or other equity linked securities) after the date hereof pursuant to this clause (i) do not, in the aggregate, exceed more than 5% of the Common Stock issued and outstanding immediately prior to the date hereof and (2) the exercise price of any stock options is not lowered, none of such stock options are amended to increase the number of shares issuable thereunder and none of the terms or conditions of any such stock options are otherwise materially changed in any manner that adversely affects the Holder; (ii) shares of Common Stock issued upon the conversion or exercise of Convertible Securities (other than standard options to purchase Common Stock issued pursuant to an Approved Stock Plan that are covered by clause (i) above) issued prior to the date hereof, provided that the conversion, exercise or other method of issuance (as the case may be) of any such Convertible Security is made solely pursuant to the conversion, exercise or other method of issuance (as the case may be) provisions of such Convertible Security that were in effect on the date immediately prior to the date of this Agreement, the conversion, exercise or issuance price of any such Convertible Securities (other than standard stock options to purchase Common Stock issued pursuant to an Approved Stock Plan that are covered by clause (i) above) is not lowered, none of such Convertible Securities (other than standard stock options to purchase Common Stock issued pursuant to an Approved Stock Plan that are covered by clause (i) above) are amended to increase the number of shares issuable thereunder and none of the terms or conditions of any such Convertible Securities (other than standard options to purchase Common Stock issued pursuant to an Approved Stock Plan that are covered by clause (i) above) are otherwise materially changed in any manner that adversely affects the Holder; or (iii) the New Securities (each of the foregoing in clauses (i) through (iii), collectively the “Excluded Securities”).  “Approved Stock Plan” means any employee benefit plan which has been 
    16

Exhibit 10.27

approved by the board of directors of the Company prior to or subsequent to the date hereof pursuant to which shares of Common Stock, restricted stock, restricted stock units, standard options to purchase Common Stock and other standard equity linked securities may be issued to any employee, officer or director for services provided to the Company in their capacity as such.  “Convertible Securities” means any capital stock or other security of the Company or any of its Subsidiaries that is at any time and under any circumstances directly or indirectly convertible into, exercisable or exchangeable for, or which otherwise entitles the holder thereof to acquire, any capital stock or other security of the Company (including, without limitation, Common Stock) or any of its Subsidiaries.
7.11 Additional Registration Statements. At any time during the Restricted Period, the Company shall not file a registration statement or an offering statement under the Securities Act (other than a registration statement on Form S-8 or such supplements or amendments to registration statements that are outstanding and have been declared effective by the SEC as of the date hereof (solely to the extent necessary to keep such registration statements effective and available and not with respect to any Subsequent Placement)). 
7.12Notices to Holder.  All notices to Holder pursuant to the Exchange Documents shall be delivered in accordance with the notice instructions set forth on the signature page of the Holder attached hereto (or such other instructions delivered in writing to the Company by the Holder from time to time). 
8.Termination.  If the Transaction is not consummated on or prior to the fifth (5th) Business Day after the date hereof, the Holder may terminate this Agreement by written notice to the Company and this Agreement shall thereafter be null and void, ab initio. 
9.Miscellaneous Provisions.  Section 9 of the Securities Purchase Agreement (as amended hereby) is hereby incorporated by reference herein, mutatis mutandis.
 [The remainder of the page is intentionally left blank]

    17

Exhibit 10.27

IN WITNESS WHEREOF, the Holder and the Company have executed this Agreement as of the date first set forth on the first page of this Agreement.
						
	

	COMPANY:
KUSHCO HOLDINGS, INC.

By: /s/ Nicholas Kovacevich
Name: Nicholas Kovacevich
Title: Chairman and Chief Executive Officer

18

IN WITNESS WHEREOF, the Holder and the Company have executed this Agreement as of the date first set forth on the first page of this Agreement.
						
	

Amounts Due on the Maturity Date under Existing Note:

$22,000,000

Principal Amount of New Note:

$19,000,000

Aggregate Number of New Shares:

4,687,500

	HOLDER:
HB SUB FUND II LLC

By:    

Name:    George Antonopoulos
Title:    Authorized Secretary
Hudson Bay Capital Management LP not individually, but solely as Investment Advisor to HB Sub Fund II LLC

Address for Notices:
Please deliver any notices other than Pre-Notices to:

c/o Hudson Bay Capital Management LP
777 Third Avenue, 30th Floor
New York, NY 10017
Attention:  Yoav Roth
Facsimile:  (212) 571-1279
E-mail:  investments@hudsonbaycapital.com
Residence:  Cayman Islands

Please deliver any Pre-Notice to:

c/o Hudson Bay Capital Management LP
777 Third Ave., 30th Floor
New York, NY 10017
Facsimile: (646) 214-7946
Attention: Scott Black
General Counsel and Chief Compliance Officer

with a copy (for information purposes only) to:
Kelley Drye & Warren LLP
101 Park Avenue
New York, NY 10178
Telephone: 212-808-7540
Facsimile: (212) 808-7897
Attention:  Michael Adelstein, Esq.
Email:  madelstein@kelleydrye.com

19

Exhibit 10.27

SCHEDULES TO EXCHANGE AGREEMENT
SCHEDULE 4.1
Subsidiaries
												
	Entity Name	Jurisdiction of Organization	Authorized Interests	Outstanding Interests
	Kush Energy, LLC	Colorado	Membership interests	100% of membership interests held by KushCo Holdings, Inc.
	Kush Supply Co. LLC	Nevada	Membership interests	100% of membership interests held by KushCo Holdings, Inc.
	Zack Darling Creative Associates, LLC	California	Membership interests	100% of membership interests held by KushCo Holdings, Inc.
	The Hybrid Creative LLC	California	Membership interests	100% of membership interests held by Zack Darling Creative Associates, LLC
	Koleto Innovations LLC	Nevada	Membership interests	100% of membership interests held by KushCo Holdings, Inc.
	KIM International Corporation	California	10,000,000 shares of a single class of stock, no par value specified	10,000 shares of stock (all held by KushCo Holdings, Inc.)
	KCH Distribution Inc.	British Columbia	1 common share	1 share of common stock (all held by KushCo Holdings, Inc.).

SCHEDULE 4.4 
Required Consents
None
SCHEDULE 4.9
Transactions with Affiliates
The Company and its subsidiaries provide customary compensation for the benefit of present and/or former directors, officers, and employees (including bonuses and stock option programs), as well as customary benefits and indemnification arrangements.
SCHEDULE 4.10
Equity Capitalization
Preemptive Rights

•Pursuant to the “Purchase Rights” set forth in Section 4(a) of the Existing Warrant, Holder is entitled to receive, on an as-converted basis, options, convertible securities, and rights to purchase stock, warrants, securities or other property that are otherwise issued to the record holders of any class of Common Stock of the Company on a pro rata basis
20

Exhibit 10.27

•Pursuant to the “Purchase Rights” set forth in Section 4(a) of those certain Warrants to Purchase Common Stock dated as of the date hereof and issued by the Company to certain affiliates and related funds of Monroe Capital Management Advisors, LLC (the “Specified Warrants”), the holder thereof is entitled to receive, on an as-converted basis, options, convertible securities, and rights to purchase stock, warrants, securities or other property that are otherwise issued to the record holders of any class of Common Stock of the Company on a pro rata basis
•Pursuant to the Securities Purchase Agreement, Holder is entitled to participation rights for any “Subsequent Placement” (as defined therein) under specified circumstances
•Pursuant to the New Note, the Holder has the right to receive warrants under specified circumstances under the definition of “Permitted Senior Indebtedness” (as defined therein)

Convertible or Exchangeable Securities
•Outstanding options to purchase 12,662,000 shares of common stock of KushCo Holdings, Inc.
•Outstanding warrants (excluding the Existing Warrant and the Specified Warrants (defined above) copies of which have been provided to Holder) to purchase 6,988,000 shares of common stock of KushCo Holdings, Inc.

SCHEDULE 4.11
Other Indebtedness
•Indebtedness incurred pursuant to the “Senior Secured Financing Agreement” (as defined in the New Note)
•The Existing Note
•The PPP Loan
21Exhibit 10.1

 

DIRECTOR
AGREEMENT

 

This
DIRECTOR AGREEMENT is made as of November 6, 2020 (the “Agreement”), by and between Conversion Labs,
Inc., a Delaware corporation (the “Company”), and Roberto Simon, an individual with an address of ____________________________________________________
(the “Director”).

 

WHEREAS,
the Company appointed the Director on November 6, 2020, and desires to enter into an agreement with the Director with respect
to such appointment; and

 

WHEREAS,
the Director is willing to accept such appointment and to serve the Company on the terms set forth herein and in accordance with
the provisions of this Agreement.

 

NOW,
THEREFORE, in consideration of the mutual covenants contained herein, the parties hereto agree as follows:

 

1.
Position. Subject to the terms and provisions of this Agreement, the Director hereby agrees to serve the Company as a member
of the Company’s Board of Directors (the “Board”) and, while a member of the Board, the Audit Committee
thereof, upon the terms and conditions hereinafter set forth, provided, however, that the Director’s continued
service on the Board after the next annual stockholders’ meeting shall be subject to approval by the Company’s stockholders.

 

2.
Duties.

 

(a)
During the Directorship Term (as defined herein), the Director shall make reasonable business efforts to attend all Board meetings,
serve on appropriate subcommittees as reasonably requested by the Board (including the Audit Committee), make himself available
to the Company at mutually convenient times and places, attend external meetings and presentations, as appropriate and convenient,
and perform such duties, services and responsibilities, and have the authority commensurate with such position.

 

(b)
The Director will use reasonable efforts to promote the interests of the Company. The Company recognizes that the Director (i)
is or may become a full-time executive employee of another entity and that his responsibilities to such entity must have priority
and (ii) sits or may sit on the board of directors of other entities. Notwithstanding the same, the Director will use reasonable
efforts to coordinate his respective commitments so as to fulfill his obligations to the Company and, in any event, will fulfill
his legal obligations as a Director. Other than as set forth above, the Director will not, without prior notification to the Board,
engage in any other business activity which could reasonably be expected to materially interfere with the performance of his duties,
services and responsibilities hereunder or which is in violation of the reasonable policies established from time to time by the
Company and of which the Director has been provided copies, provided that the foregoing shall in no way limit his activities on
behalf of (i) any current or future employer and its affiliates or (ii) the board of directors of any entities on which he currently
sits or hereafter joins. At such time as the Board receives such notification, the Board may require the resignation of the Director
if it determines that such business activity does in fact materially interfere with the performance of the Director’s duties,
services and responsibilities hereunder.

 

3.
Compensation.

 

(a)
Restricted Common Stock. Upon approval of the Company’s Employee Stock Option Plan, (the “2020
Plan”) the Director shall receive a one-time grant of Twenty Thousand (20,000) restricted shares of the
Company’s common stock. If the 2020 Plan is not approved and the shares are not issued to the Director prior to the
90 day anniversary of this Agreement, the Company shall issue the shares to consultant on the 90 day anniversary of this
Agreement. In addition, and for subsequent years of service, the Director will be eligible for additional equity
compensation.

 

(b)
Director Fees. In further consideration for the Director’s service on the Audit committee, during the Directorship Term,
he shall be paid $6,000 per quarter, payable in advance on the first business day of each quarter commencing on November 5, 2020
by wire transfer to the account designated by the Director. For the initial quarter, the Director shall receive a prorated amount
of $4,000, which shall be transferred within 2 business days of execution of this Agreement.

 

    	 

     

    

 

(c)
Independent Contractor. The Director’s status during the Directorship Term shall be that of an independent contractor and
not, for any purpose, that of an employee or agent with authority to bind the Company in any respect. All payments and other consideration
made or provided to the Director under this Section 3 shall be made or provided without withholding or deduction of any kind,
and the Director shall assume sole responsibility for discharging all tax or other obligations associated therewith.

 

(d)
Expense Reimbursements. During the Directorship Term, the Company shall reimburse the Director for (i) all reasonable out-of-pocket
expenses incurred by the Director in attending any in-person meetings, provided that the Director complies with the generally
applicable policies, practices and procedures of the Company for submission of expense reports, receipts or similar documentation
of such expenses, and (ii) any costs associated with filings required to be made by the Director or any of the entities managed
or controlled by Director to report beneficial ownership or the acquisition or disposition of securities of the Company. Any reimbursements
for allocated expenses (as compared to out-of-pocket expenses of the Director) must be approved in advance by the Company.

 

4.
Directorship Term. The “Directorship Term,” as used in this Agreement, shall mean the period commencing
on the date hereof and terminating on the earlier of the date of the next annual stockholders meeting or the earliest of the following
to occur:

 

	 	(a)	the
    death of the Director;
	 	 	 
	 	(b)	the
termination of the Director from his membership on the Board by the mutual agreement of the Company and the Director;
	 	 	 
	 	(c)	the
removal of the Director from the Board by the majority stockholders of the Company; or
	 	 	 
	 	(d)	the
resignation by the Director from the Board.

 

5.
Director’s Representation and Acknowledgment. The Director represents to the Company that his execution and performance
of this Agreement shall not be in violation of any agreement or obligation (whether or not written) that he has with or to any
person or entity, including without limitation, any prior or current employer. The Director hereby acknowledges and agrees that
this Agreement (and any other agreement or obligation referred to herein) shall be an obligation solely of the Company, and the
Director shall have no recourse whatsoever against any officer, director, employee, stockholder, representative or agent of the
Company or any of their respective affiliates with regard to this Agreement.

 

6.
Director Covenants.

 

(a)
Unauthorized Disclosure. The Director agrees and understands that in the Director’s position with the Company, the Director
has been and will be exposed to and receive information relating to the confidential affairs of the Company, including, but not
limited to, technical information, business and marketing plans, strategies, customer information, other information concerning
the Company’s products, services, promotions, development, financing, expansion plans, business policies and practices,
and other forms of information considered by the Company to be confidential, and proprietary and in the nature of trade secrets.
The Director agrees that during the Directorship Term and thereafter, the Director will keep such information confidential and
will not disclose such information, either directly or indirectly, to any third person or entity without the prior written consent
of the Company; provided, however, that (i) the Director shall have no such obligation to the extent such information is or becomes
publicly known or generally known in the Company’s industry other than as a result of the Director’s breach of his
obligations hereunder and (ii) the Director may, after giving prior notice to the Company to the extent practicable and lawful
under the circumstances, disclose such information to the extent required by applicable laws or governmental regulations or judicial
or regulatory process. This confidentiality covenant has no temporal, geographical or territorial restriction. Upon termination
of the Directorship Term, the Director will promptly return to the Company and/or destroy at the Company’s direction all
property, keys, notes, memoranda, writings, lists, files, reports, customer lists, correspondence, tapes, disks, cards, surveys,
maps, logs, machines, technical data, other product or document, and any summary or compilation of the foregoing, in whatever
form, including, without limitation, in electronic form, which has been produced by, received by or otherwise submitted to the
Director in the course or otherwise as a result of the Director’s position with the Company during or prior to the Directorship
Term, provided that the Company shall retain such materials and make them available to the Director if requested by him
in connection with any litigation against the Director under circumstances in which (i) the Director demonstrates to the reasonable
satisfaction of the Company that the materials are necessary to his defense in the litigation and (ii) the confidentiality of
the materials is preserved to the reasonable satisfaction of the Company. Nothing contained herein shall be deemed to preclude
or restrict the Director from making any legally required disclosures or from making disclosures pursuant to any whistleblower
or similar statutory or regulatory regime.

 

    	 

     

    

 

(b)
Non-Solicitation. During the Directorship Term and for a period of three (3) years thereafter, the Director shall not interfere
with the Company’s relationship with, or endeavor to entice away from the Company, any person who, on the date of the termination
of the Directorship Term and/or at any time during the one year period prior to the termination of the Directorship Term, was
an employee or customer (including those reasonably expected to be a customer) of the Company or otherwise had a material business
relationship with the Company.

 

(c)
Non-Compete. During the Directorship Term and for a period of three (3) years thereafter, the Director shall not in any manner,
directly or indirectly, through any person, firm or corporation, alone or as a member of a partnership or as an officer, director,
stockholder, investor or employee of or consultant to any other corporation or enterprise; engage in the business of developing,
marketing, selling or supporting technology to or for businesses in which the Company engages in or in which the Company has an
actual intention, as evidenced by the Company’s written business plans created during the Directorship Term, to engage in,
within any geographic area in which the Company is then conducting such business. Nothing in this Section 6 shall prohibit the
Director from being (i) a stockholder in a mutual fund or a diversified investment company or (ii) a passive owner of not more
than three percent of the outstanding stock of any class of securities of a corporation, which are publicly traded, so long as
the Director has no active participation in the business of such corporation.

 

(d)
Insider Trading. Director understands and acknowledges that the securities of the Company are publicly traded and subject to the
Securities Act of 1933 and the Securities Exchange Act of 1934. As a result, Director agrees to (i) refrain from trading in securities
of the Company while in possession of material nonpublic information, (ii) refrain from disclosing any material nonpublic information
to anyone except as permitted in connection with the performance of Director’s duties hereunder or as required by law, and
(iii) communicate to any person who, to Director’s knowledge, receives any material nonpublic information that such information
is material nonpublic information and that the trading and disclosure restrictions in clause (i) above also apply to such person.

 

(e)
Remedies. The Director agrees that any breach of the terms of this Section 6 would result in irreparable injury and damage to
the Company for which the Company would have no adequate remedy at law. The Director therefore also agrees that in the event of
said breach or any threat of breach, the Company shall be entitled to an immediate injunction and restraining order to prevent
such breach and/or threatened breach and/or continued breach by the Director and/or any and all entities acting for and/or with
the Director, without having to prove damages or paying a bond, in addition to any other remedies to which the Company may be
entitled at law or in equity. The terms of this paragraph shall not prevent the Company from pursuing any other available remedies
for any breach or threatened breach hereof, including, but not limited to, the recovery of damages from the Director. The Director
acknowledges that the Company would not have entered into this Agreement had the Director not agreed to the provisions of this
Section 6.

 

(f)
The provisions of this Section 6 shall survive any termination of the Directorship Term, and the existence of any claim or cause
of action by the Director against the Company, whether predicated on this Agreement or otherwise, shall not constitute a defense
to the enforcement by the Company of the covenants and agreements of this Section 6.

 

    	 

     

    

 

7.
Termination for Cause. The Company may terminate the engagement of Director if the Board determines that Director has:

 

	 	(a)	materially
    breached any provision hereof or habitually neglected the duties which Director was required to perform under any provision
    of this Agreement;
	 	 	 
	 	(b)	misappropriated
    funds or property of the Company or otherwise engaged in acts of dishonesty, fraud, misrepresentation or other acts
    of moral turpitude, even if not in connection with the performance of Director’s duties hereunder, which could reasonably
    be expected to result in serious prejudice to the interests of the Company if Director were retained as a director;
	 	 	 
	 	(c)	secured
    any personal profit not completely disclosed to and approved by the Company in connection with any transaction entered into
    on behalf of or with the Company or any affiliate of the Company; or
	 	 	 
	 	(d)	failed
    to carry out and perform duties assigned to Director in accordance with the terms hereof in a manner acceptable to the Board
    after a written demand for substantial performance is delivered to Director which identifies the manner in which Director
    has not substantially performed Director’s duties, and provided further that Director shall be given a reasonable opportunity
    to cure such failure.

 

For
purposes of this section, the Director shall not be terminated for Cause without (i) reasonable notice to the Director setting
forth the reasons for the Company’s intention to Terminate for Cause and a reasonable opportunity to cure such situation
(if capable of cure), (ii) an opportunity for the Director, together with counsel, to be heard before the Board, and (iii) delivery
to the Director of a notice of termination from the Board of the Company, finding that, in the good faith opinion of the Board,
the Director had engaged in the conduct set forth above and specifying the particulars thereof in detail.

 

8.
Indemnification. The Company agrees to indemnify the Director for his activities as a member of the Board as set forth
in the Director and Officer Indemnification Agreement attached hereto as Exhibit A. In addition, the Company shall
exercise its best efforts to increase the coverage limit of its directors’ and officers’ liability insurance policy
(and not otherwise diminish the scope or value of such coverage) to at least $3 million not later than April 1, 2021 and to at
least $5 million not later than November 1, 2021, and shall thereafter maintain in effect such coverage with a coverage limit
of at least that amount and containing no materially less favorable provisions.

 

9.
Non-Waiver of Rights. The failure to enforce at any time the provisions of this Agreement or to require at any time performance
by the other party hereto of any of the provisions hereof shall in no way be construed to be a waiver of such provisions or to
affect either the validity of this Agreement or any part hereof, or the right of either party hereto to enforce each and every
provision in accordance with its terms. No waiver by either party hereto of any breach by the other party hereto of any provision
of this Agreement to be performed by such other party shall be deemed a waiver of similar or dissimilar provisions at that time
or at any prior or subsequent time.

 

10.
Notices. Every notice relating to this Agreement shall be in writing and shall be given by personal delivery, overnight
delivery or by registered or certified mail, postage prepaid, return receipt requested; to:

 

If
to the Company:

 

Conversion
Labs, Inc.

800
Third Avenue, Suite 2800

New
York, NY 10022

Attn:
Justin Schreiber, Chief Executive Officer

Telephone:

 

with
a copy (which shall not constitute notice) to:

 

Lucosky
Brookman LLP

101
Wood Avenue South

Woodbridge,
New Jersey 08830

Attn:
Lawrence Metelitsa, Esq.

Telephone:
(732) 395-4400

Facsimile:
(732) 395-4401

 

If
to the Director:

 

    	 

     

    

 

Either
of the parties hereto may change their address for purposes of notice hereunder by giving notice in writing to such other party
pursuant to this Section 10.

 

11.
Binding Effect/Assignment. This Agreement shall inure to the benefit of and be binding upon the parties hereto and their
respective heirs, executors, personal representatives, estates, successors (including, without limitation, by way of merger) and
assigns, as applicable. Notwithstanding the provisions of the immediately preceding sentence, neither the Director nor the Company
shall assign all or any portion of this Agreement without the prior written consent of the other party.

 

12.
Entire Agreement. This Agreement (together with the other agreements referred to herein) sets forth the entire understanding
of the parties hereto with respect to the subject matter hereof and supersedes all prior agreements, written or oral, between
them as to such subject matter.

 

13.
Severability. If any provision of this Agreement, or any application thereof to any circumstances, is invalid, in whole
or in part, such provision or application shall to that extent be severable and shall not affect other provisions or applications
of this Agreement.

 

14.
Governing Law. This Agreement and the legal relations among the parties shall be governed by, and construed and enforced
in accordance with, the laws of the State of Delaware, without regard to its conflict of laws rules.

 

15.
Dispute Resolution. In the event of any dispute arising under or pursuant to this Agreement, the parties agree to attempt
to resolve the dispute in a commercially reasonable fashion before instituting any litigation (with the exception of emergency
injunctive relief). If the parties are unable to resolve the dispute within thirty (30) days, then the parties agree to mediate
the dispute with a mutually agreed upon mediator in New York, NY. If the parties cannot agree upon a mediator within ten (10)
days after either party shall first request commencement of mediation, each party will select a mediator within five (5) days
thereof, and those mediators shall select the mediator to be used. The mediation shall be scheduled within thirty (30) days following
the selection of the mediator. The parties further agree that any applicable statute of limitations will be tolled for the period
of time from the date mediation is requested until 14 days following the mediation. If the mediation does not resolve the dispute,
then the parties irrevocably and unconditionally (i) agree that any action or proceeding arising out of or in connection with
this Agreement shall be brought in the Chancery Court of the State of Delaware (the “Delaware Court”), and
not in any other state or federal court in the United States of America or any court in any other country, (ii) consent to submit
to the exclusive jurisdiction of the Delaware Court for purposes of any action or proceeding arising out of or in connection with
this Agreement, (iii) waive any objection to the laying of venue of any such action or proceeding in the Delaware Court, and (iv)
waive, and agree not to plead or to make, any claim that any such action or proceeding brought in the Delaware Court has been
brought in an improper or inconvenient forum.

 

16.
Legal Fees. The parties hereto agree that the non-prevailing party in any dispute, claim, action or proceeding between
the parties hereto arising out of or relating to the terms and conditions of this Agreement or any provision thereof (a “Dispute”),
shall reimburse the prevailing party for reasonable attorney’s fees and expenses incurred by the prevailing party in connection
with such Dispute; provided, however, that the Director shall only be required to reimburse the Company for its fees and expenses
incurred in connection with a Dispute if the Director’s position in such Dispute was found by the court, arbitrator or other
person or entity presiding over such Dispute to be frivolous or advanced not in good faith.

 

    	 

     

    

 

17.
Modifications. Neither this Agreement nor any provision hereof may be modified, altered, amended or waived except by an
instrument in writing duly signed by the party to be charged.

 

18.
Tense and Headings. Whenever any words used herein are in the singular form, they shall be construed as though they were
also used in the plural form in all cases where they would so apply. The headings contained herein are solely for the purposes
of reference, are not part of this Agreement and shall not in any way affect the meaning or interpretation of this Agreement.

 

19.
Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed to be an original
but all of which together shall constitute one and the same instrument.

 

[-Signature
Page Follows-]

 

    	 

     

    

 

IN
WITNESS WHEREOF, the Company has caused this Director Agreement to be executed by authority of its Board, and the Director has
hereunto set his hand, on the day and year first above written.

 

CONVERSION
LABS, INC.

 

	By:	 	 
	 	Justin
    Schreiber	 
	 	Chief
    Executive Officer	 

 

	 	 
	DIRECTOR	 
	 	 
		 
	Roberto Simon, an individual	 

 

[Signature
page to Director Agreement]

 

    	 

     

    

 

EXHIBIT
A

 

CONVERSION
LABS, INC.

DIRECTOR
AND OFFICER INDEMNIFICATION AGREEMENT

 

This
Director and Officer Indemnification Agreement, dated as of November 6, 2020 (the “Agreement”),
is made by and between Conversion Labs, Inc., a Delaware corporation (the “Company”), and Roberto Simon
(the “Indemnitee”).

 

RECITALS:

 

A.
The Delaware General Corporation Law provides that the business and affairs of a corporation shall be managed by or under the
direction of its board of directors.

 

B.
By virtue of the managerial prerogatives vested in the directors and officers of a Delaware corporation, directors and officers
act as fiduciaries of the corporation and its stockholders.

 

C.
It is critically important to the Company and its stockholders that the Company be able to attract and retain the most capable
persons reasonably available to serve as directors and officers of the Company.

 

D.
In recognition of the need for corporations to be able to induce capable and responsible persons to accept positions in corporate
management, Delaware law authorizes (and in some instances requires) corporations to indemnify their directors and officers, and
further authorizes corporations to purchase and maintain insurance for the benefit of their directors and officers.

 

E.
Courts have recognized that indemnification by a corporation serves the dual policies of (1) allowing corporate officials to resist
unjustified lawsuits, secure in the knowledge that, if vindicated, the corporation will bear the expense of litigation, and (2)
encouraging capable women and men to serve as corporate directors and officers, secure in the knowledge that the corporation will
absorb the costs of defending their honesty and integrity.

 

F.
The number of lawsuits challenging the judgment and actions of directors and officers of corporations, the costs of defending
those lawsuits and the threat to personal assets have all materially increased over the past several years, chilling the willingness
of capable women and men to undertake the responsibilities imposed on corporate directors and officers.

 

G.
Recent federal legislation and rules adopted by the Securities and Exchange Commission and the national securities exchanges have
exposed such directors and officers to new and substantially broadened civil liabilities.

 

H.
Under Delaware law, a director’s or officer’s right to be reimbursed for the costs of defense of criminal actions,
whether such claims are asserted under state or federal law, does not depend upon the merits of the claims asserted against the
director or officer and is separate and distinct from any right to indemnification the director may be able to establish.

 

I.
Indemnitee is, or will be, a director of the Company and his or her willingness to serve in such capacity is predicated, in substantial
part, upon the Company’s willingness to indemnify him or her in accordance with the principles reflected above, to the fullest
extent permitted by the laws of the State of Delaware, and upon the other undertakings set forth in this Agreement.

 

J.
In recognition of the need to provide Indemnitee with substantial protection against personal liability, in order to procure Indemnitee’s
service as a director of the Company and to enhance Indemnitee’s ability to serve the Company in an effective manner, and
in order to provide such protection pursuant to express contract rights (intended to be enforceable irrespective of, among other
things, any amendment to the Company’s certificate of incorporation or bylaws (collectively, the “Constituent
Documents”), any change in the composition of the Company’s Board of Directors (the “Board”)
or any change-in-control or business combination transaction relating to the Company), the Company wishes to provide in this Agreement
for the indemnification and advancement of Expenses (as defined herein) to Indemnitee on the terms, and subject to the conditions,
set forth in this Agreement.

 

K.
In light of the considerations referred to in the preceding recitals, it is the Company’s intention and desire that the
provisions of this Agreement be construed liberally, subject to their express terms, to maximize the protections to be provided
to Indemnitee hereunder.

 

    	 

     

    

 

AGREEMENT:

 

NOW,
THEREFORE, the parties hereto hereby agree as follows:

 

1.
Certain Definitions. In addition to terms defined elsewhere herein, the following terms have the following meanings when
used in this Agreement with initial capital letters:

 

(a)
“Change in Control” shall have occurred at such time, if any, as Incumbent Directors cease for any reason
to constitute a majority of the directors. For purposes of this Section 1(a), “Incumbent Directors”
means the individuals who, as of the date hereof, are directors of the Company and any individual becoming a director subsequent
to the date hereof whose election, nomination for election by the Company’s stockholders, or appointment, was approved by
a vote of at least a majority of the then Incumbent Directors (either by a specific vote or by approval of the proxy statement
of the Company in which such person is named as a nominee for director, without objection to such nomination); provided, however,
that an individual shall not be an Incumbent Director if such individual’s election or appointment to the Board occurs
as a result of an actual or threatened election contest (as described in Rule 14a-12(c) of the Securities Exchange Act of 1934,
as amended) with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents
by or on behalf of a Person other than the Board.

 

(b)
“Claim” means (i) any threatened, asserted, pending or completed claim, demand, action, suit or proceeding,
whether civil, criminal, administrative, arbitrative, investigative or other, and whether made pursuant to federal, state or other
law; and (ii) any inquiry or investigation, whether made, instituted or conducted by the Company or any other Person, including,
without limitation, any federal, state or other governmental entity, that Indemnitee reasonably determines might lead to the institution
of any such claim, demand, action, suit or proceeding. For the avoidance of doubt, the Company intends the indemnity to be provided
hereunder in respect of acts or failure to act prior to, on or after the date hereof.

 

(c)
“Controlled Affiliate” means any corporation, limited liability company, partnership, joint venture,
trust or other entity or enterprise, whether or not for profit, that is directly or indirectly controlled by the Company. For
purposes of this definition, “control” means the possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of an entity or enterprise, whether through the ownership of voting
securities, through other voting rights, by contract or otherwise; provided that direct or indirect beneficial ownership
of capital stock or other interests in an entity or enterprise entitling the holder to cast 15% or more of the total number of
votes generally entitled to be cast in the election of directors (or persons performing comparable functions) of such entity or
enterprise shall be deemed to constitute control for purposes of this definition.

 

(d)
“Disinterested Director” means a director of the Company who is not and was not a party to the Claim
in respect of which indemnification is sought by Indemnitee.

 

(e)
“Expenses” means reasonable attorneys’ and experts’ fees and expenses and all other costs
and expenses paid or payable in connection with investigating, defending, being a witness in or participating in (including on
appeal), or preparing to investigate, defend, be a witness in or participate in (including on appeal), any Claim.

 

(f)
“Indemnifiable Claim” means any Claim based upon, arising out of or resulting from (i) any actual, alleged
or suspected act or failure to act by Indemnitee in his capacity as a director, officer, employee or agent of the Company or as
a director, officer, employee, member, manager, trustee or agent of any other corporation, limited liability company, partnership,
joint venture, trust or other entity or enterprise, whether or not for profit, as to which Indemnitee is or was serving at the
request of the Company, (ii) any actual, alleged or suspected act or failure to act by Indemnitee in respect of any business,
transaction, communication, filing, disclosure or other activity of the Company or any other entity or enterprise referred to
in clause (i) of this sentence, or (iii) Indemnitee’s status as a current or former director, officer, employee or agent
of the Company or as a current or former director, officer, employee, member, manager, trustee or agent of the Company or any
other entity or enterprise referred to in clause (i) of this sentence or any actual, alleged or suspected act or failure to act
by Indemnitee in connection with any obligation or restriction imposed upon Indemnitee by reason of such status. In addition to
any service at the actual request of the Company, for purposes of this Agreement, Indemnitee shall be deemed to be serving or
to have served at the request of the Company as a director, officer, employee, member, manager, trustee or agent of another entity
or enterprise if Indemnitee is or was serving as a director, officer, employee, member, manager, agent, trustee or other fiduciary
of such entity or enterprise and (i) such entity or enterprise is, or at the time of such service was, a Controlled Affiliate,
(ii) such entity or enterprise is or at the time of such service was an employee benefit plan (or related trust) sponsored or
maintained by the Company or a Controlled Affiliate, or (iii) the Company or a Controlled Affiliate (by action of the Board, any
committee thereof or the Company’s Chief Executive Officer (“CEO”) (other than as the CEO himself)) caused or
authorized Indemnitee to be nominated, elected, appointed, designated, employed, engaged or selected to serve in such capacity.

 

    	 

     

    

 

(g)
“Indemnifiable Losses” means any and all Losses relating to, arising out of or resulting from any Indemnifiable
Claim; provided, however, that Indemnifiable Losses shall not include Expenses incurred by Indemnitee in respect
of any Indemnifiable Claim (or any matter or issue therein) as to which Indemnitee shall have been adjudged liable to the Company,
unless and only to the extent that the court in which such Indemnifiable Claim was brought shall have determined upon application
that, despite the adjudication of liability but in view of all the circumstances of the case, Indemnitee is fairly and reasonably
entitled to indemnification for such Expenses as the court shall deem proper.

 

(h)
“Independent Counsel” means a nationally recognized law firm, or a member of a nationally recognized
law firm, that is experienced in matters of Delaware corporate law and neither presently is, nor in the past five years has been,
retained to represent: (i) the Company (or any subsidiary) or Indemnitee in any matter material to either such party (other than
with respect to matters concerning the Indemnitee under this Agreement, or of other indemnitees under similar indemnification
agreements) or (ii) any other named (or, as to a threatened matter, reasonably likely to be named) party to the Indemnifiable
Claim giving rise to a claim for indemnification hereunder. Notwithstanding the foregoing, the term “Independent Counsel”
shall not include any person who, under the applicable standards of professional conduct then prevailing, would have a conflict
of interest in representing either the Company or Indemnitee in an action to determine Indemnitee’s rights under this Agreement.

 

(i)
“Losses” means any and all Expenses, damages, losses, liabilities, judgments, fines, penalties (whether
civil, criminal or other) and amounts paid or payable in settlement, including, without limitation, all interest, assessments
and other charges paid or payable in connection with or in respect of any of the foregoing.

 

(j)
“Person” means any individual, entity or group, within the meaning of Section 13(d)(3) or 14(d)(2) of
the Securities Exchange Act of 1934, as amended.

 

(k)
“Standard of Conduct” means the standard for conduct by Indemnitee that is a condition precedent to
indemnification of Indemnitee hereunder against Indemnifiable Losses relating to, arising out of or resulting from an Indemnifiable
Claim. The Standard of Conduct is (i) good faith and a reasonable belief by Indemnitee that his action was in or not opposed to
the best interests of the Company and, with respect to any criminal action or proceeding, that Indemnitee had no reasonable cause
to believe that his conduct was unlawful, or (ii) any other applicable standard of conduct that may hereafter be substituted under
the Delaware General Corporation Law.

 

2.
Indemnification Obligation. Subject only to Section 7 and to the proviso in this Section, the Company shall indemnify,
defend and hold harmless Indemnitee, to the fullest extent permitted by the laws of the State of Delaware in effect on the date
hereof or as such laws may from time to time hereafter be amended to increase the scope of such permitted indemnification,
against any and all Indemnifiable Claims and Indemnifiable Losses; provided, however, that, except as provided in Section
5, Indemnitee shall not be entitled to indemnification pursuant to this Agreement in connection with (i) any Claim
initiated by Indemnitee against the Company or any director or officer of the Company unless the Company has joined in or consented
to the initiation of such Claim or the Claim relates to or arises from the enforcement or prosecution of a right to indemnification
under this Agreement, or (ii) the purchase and sale by Indemnitee of securities in violation of Section 16(b) of the Securities
Exchange Act of 1934, as amended. Nothing herein is intended to limit the scope of permitted indemnification to Indemnitee under
the laws of the State of Delaware.

 

3.
Advancement of Expenses. Indemnitee shall have the right to advancement by the Company prior to the final disposition of
any Indemnifiable Claim of any and all actual and reasonable Expenses relating to, arising out of or resulting from any
Indemnifiable Claim paid or incurred by Indemnitee. Without limiting the generality or effect of any other provision hereof, Indemnitee’s
right to such advancement is not subject to the satisfaction of any Standard of Conduct. Without limiting the generality or effect
of the foregoing, within five business days after any request by Indemnitee that is accompanied by supporting documentation for
specific reasonable Expenses to be reimbursed or advanced, the Company shall, in accordance with such request (but without duplication),
(a) pay such Expenses on behalf of Indemnitee, (b) advance to Indemnitee funds in an amount sufficient to pay such Expenses, or
(c) reimburse Indemnitee for such Expenses; provided that Indemnitee shall repay, without interest, any amounts actually
advanced to Indemnitee that, at the final disposition of the Indemnifiable Claim to which the advance related, were in excess
of amounts paid or payable by Indemnitee in respect of Expenses relating to, arising out of or resulting from such Indemnifiable
Claim. In connection with any such payment, advancement or reimbursement, at the request of the Company, Indemnitee shall execute
and deliver to the Company an undertaking, which need not be secured and shall be accepted without reference to Indemnitee’s
ability to repay the Expenses, by or on behalf of the Indemnitee, to repay any amounts paid, advanced or reimbursed by the Company
in respect of Expenses relating to, arising out of or resulting from any Indemnifiable Claim in respect of which it shall have
been determined, following the final disposition of such Indemnifiable Claim and in accordance with Section 7, that Indemnitee
is not entitled to indemnification hereunder.

 

    	 

     

    

 

4.
Indemnification for Additional Expenses. Without limiting the generality or effect of the foregoing, the Company shall
indemnify and hold harmless Indemnitee against and, if requested by Indemnitee, shall reimburse Indemnitee for, or advance to
Indemnitee, within five business days of such request accompanied by supporting documentation for specific Expenses to be reimbursed
or advanced, any and all actual and reasonable Expenses paid or incurred by Indemnitee in connection with any Claim made, instituted
or conducted by Indemnitee for (a) indemnification or reimbursement or advance payment of Expenses by the Company under any provision
of this Agreement, or under any other agreement or provision of the Constituent Documents now or hereafter in effect relating
to Indemnifiable Claims, and/or (b) recovery under any directors’ and officers’ liability insurance policies maintained
by the Company; provided, however, if it is ultimately determined that the Indemnitee is not entitled to such indemnification,
reimbursement, advance or insurance recovery, as the case may be, then the Indemnitee shall be obligated to repay any such Expenses
to the Company; provided further, that, regardless in each case of whether Indemnitee ultimately is determined to be entitled
to such indemnification, reimbursement, advance or insurance recovery, as the case may be, Indemnitee shall return, without interest,
any such advance of Expenses (or portion thereof) which remains unspent at the final disposition of the Claim to which the advance
related.

 

5.
Partial Indemnity. If Indemnitee is entitled under any provision of this Agreement to indemnification by the Company for
some or a portion of any Indemnifiable Loss but not for the entire amount thereof, the Company shall nevertheless indemnify Indemnitee
for the portion thereof to which Indemnitee is entitled.

 

6.
Procedure for Notification. To obtain indemnification under this Agreement in respect of an Indemnifiable Claim or Indemnifiable
Loss, Indemnitee shall submit to the Company a written request therefore, including a brief description (based upon information
then available to Indemnitee) of such Indemnifiable Claim or Indemnifiable Loss. If, at the time of the receipt of such request,
the Company has directors’ and officers’ liability insurance in effect under which coverage for such Indemnifiable
Claim or Indemnifiable Loss is potentially available, the Company shall give prompt written notice of such Indemnifiable Claim
or Indemnifiable Loss to the applicable insurers in accordance with the procedures set forth in the applicable policies. The Company
shall thereafter take all necessary or desirable action to cause such insurers to pay, on behalf of the Indemnitee, all Indemnifiable
Claims and Indemnifiable Losses in accordance with the terms of such policies. The Company shall provide to Indemnitee a copy
of such notice delivered to the applicable insurers, substantially concurrently with the delivery thereof by the Company. The
failure by Indemnitee to timely notify the Company of any Indemnifiable Claim or Indemnifiable Loss shall not relieve the Company
from any liability hereunder unless, and only to the extent that, the Company did not otherwise learn of such Indemnifiable Claim
or Indemnifiable Loss and to the extent that such failure results in forfeiture by the Company of substantial defenses, rights
or insurance coverage.

 

7.
Determination of Right to Indemnification.

 

(a)
To the extent that Indemnitee shall have been successful on the merits or otherwise in defense of any Indemnifiable Claim
or any portion thereof or in defense of any issue or matter therein, including, without limitation, dismissal without prejudice,
Indemnitee shall be indemnified against all Indemnifiable Losses relating to, arising out of or resulting from such Indemnifiable
Claim in accordance with Section 2 and no Standard of Conduct Determination (as defined in Section 7(b))
shall be required.

 

(b)
To the extent that the provisions of Section 7(a) are inapplicable to an Indemnifiable Claim that shall have been finally
disposed of, any determination required to be made under the laws of the State of Delaware as to whether Indemnitee has satisfied
the applicable Standard of Conduct (a “Standard of Conduct Determination”) shall be made as follows:
(i) if a Change in Control shall not have occurred, or if a Change in Control shall have occurred but Indemnitee shall have requested
that the Standard of Conduct Determination be made pursuant to this clause (i), (A) by a majority vote of the Disinterested Directors,
even if less than a quorum of the Board, (B) if such Disinterested Directors so direct, by a majority vote of a committee of Disinterested
Directors designated by a majority vote of all Disinterested Directors, or (C) if there are no such Disinterested Directors, or
if a majority of the Disinterested Directors so direct, by Independent Counsel in a written opinion addressed to the Board, a
copy of which shall be delivered to Indemnitee; and (ii) if a Change in Control shall have occurred and Indemnitee shall not have
requested that the Standard of Conduct Determination be made pursuant to clause (i) above, by Independent Counsel in a written
opinion addressed to the Board, a copy of which shall be delivered to Indemnitee.

 

    	 

     

    

 

(c)
If (i) Indemnitee shall be entitled to indemnification hereunder against any Indemnifiable Losses pursuant to Section 7(a), (ii)
no determination of whether Indemnitee has satisfied any applicable standard of conduct under Delaware law is a legally required
condition precedent to indemnification of Indemnitee hereunder against any Indemnifiable Losses, or (iii) Indemnitee has been
determined or deemed pursuant to Section 7(b) to have satisfied the applicable Standard of Conduct, then the Company shall pay
to Indemnitee, within five business days after the later of (x) the notification date in respect of the Indemnifiable Claim or
portion thereof to which such Indemnifiable Losses are related, out of which such Indemnifiable Losses arose or from which such
Indemnifiable Losses resulted, and (y) the earliest date on which the applicable criterion specified in clause (i), (ii) or (iii)
above shall have been satisfied, an amount equal to the amount of such Indemnifiable Losses. Nothing herein is intended to mean
or imply that the Company is intending to use the Delaware General Corporations Law to dispense with a requirement that Indemnitee
meet the applicable Standard of Conduct where it is otherwise required by such statute.

 

(d)
If a Standard of Conduct Determination is required to be, but has not been, made by Independent Counsel pursuant to Section 7(b)(i),
the Independent Counsel shall be selected by the Board or a committee of the Board, and the Company shall give written notice
to Indemnitee advising him or her of the identity of the Independent Counsel so selected. If a Standard of Conduct Determination
is required to be, or to have been, made by Independent Counsel pursuant to Section 7(b)(ii), the Independent Counsel shall be
selected by Indemnitee, and Indemnitee shall give written notice to the Company advising it of the identity of the Independent
Counsel so selected. In either case, Indemnitee or the Company, as applicable, may, within five business days after receiving
written notice of selection from the other, deliver to the other a written objection to such selection; provided, however,
that such objection may be asserted only on the ground that the Independent Counsel so selected does not satisfy the criteria
set forth in the definition of “Independent Counsel” in Section 1(h), and the objection shall set forth with particularity
the factual basis of such assertion. Absent a proper and timely objection, the Person so selected shall act as Independent Counsel.
If such written objection is properly and timely made and substantiated, (i) the Independent Counsel so selected may not serve
as Independent Counsel unless and until such objection is withdrawn or a court has determined that such objection is without merit
and (ii) the non-objecting party may, at its option, select an alternative Independent Counsel and give written notice to the
other party advising such other party of the identity of the alternative Independent Counsel so selected, in which case the provisions
of the two immediately preceding sentences and clause (i) of this sentence shall apply to such subsequent selection and notice.
If applicable, the provisions of clause (ii) of the immediately preceding sentence shall apply to successive alternative selections.
If no Independent Counsel that is permitted under the foregoing provisions of this Section 7(d) to make the Standard of Conduct
Determination shall have been selected within 30 calendar days after the Company gives its initial notice pursuant to the first
sentence of this Section 7(d) or Indemnitee gives its initial notice pursuant to the second sentence of this Section 7(d), as
the case may be, either the Company or Indemnitee may petition the courts of the State of Delaware for resolution of any objection
which shall have been made by the Company or Indemnitee to the other’s selection of Independent Counsel and/or for the appointment
as Independent Counsel of a person or firm selected by such court or by such other person as such Court shall designate, and the
person or firm with respect to whom all objections are so resolved or the person or firm so appointed will act as Independent
Counsel. In all events, the Company shall pay all of the actual and reasonable fees and expenses of the Independent Counsel incurred
in connection with the Independent Counsel’s determination pursuant to Section 7(b).

 

8.
Cooperation. Indemnitee shall cooperate with reasonable requests of the Company in connection with any Indemnifiable Claim
and any individual or firm making such Standard of Conduct Determination, including providing to such Person documentation or
information which is not privileged or otherwise protected from disclosure and which is reasonably available to Indemnitee and
reasonably necessary to defend the Indemnifiable Claim or make any Standard of Conduct Determination without incurring any unreimbursed
cost in connection therewith. The Company shall indemnify and hold harmless Indemnitee against and, if requested by Indemnitee,
shall reimburse Indemnitee for, or advance to Indemnitee, within five business days of such request accompanied by supporting
documentation for specific costs and expenses to be reimbursed or advanced, any and all costs and expenses (including reasonable
attorneys’ and experts’ fees and expenses) actually and reasonably incurred by Indemnitee in so cooperating with the
Person defending the Indemnifiable Claim or making such Standard of Conduct Determination.

 

    	 

     

    

 

9.
Presumption of Entitlement. Notwithstanding any other provision hereof, in making any Standard of Conduct Determination,
the Person making such determination shall presume that Indemnitee has satisfied the applicable Standard of Conduct.

 

10.
No Other Presumption. For purposes of this Agreement, the termination of any Claim by judgment, order, settlement (whether
with or without court approval) or conviction, or upon a plea of nolo contendere or its equivalent, will not create a presumption
that Indemnitee did not meet any applicable Standard of Conduct or that indemnification hereunder is otherwise not permitted.

 

11.
Non-Exclusivity. The rights of Indemnitee hereunder will be in addition to any other rights Indemnitee may have under the
Constituent Documents, or the substantive laws of the State of Delaware, any other contract or otherwise (collectively, “Other
Indemnity Provisions”); provided, however, that (a) to the extent that Indemnitee otherwise would have any
greater right to indemnification under any Other Indemnity Provision, Indemnitee will without further action be deemed to have
such greater right hereunder, and (b) to the extent that any change is made to any Other Indemnity Provision which permits any
greater right to indemnification than that provided under this Agreement as of the date hereof, Indemnitee will be deemed to have
such greater right hereunder. The Company may not, without the consent of Indemnitee, adopt any amendment to any of the Constituent
Documents the effect of which would be to deny, diminish or encumber Indemnitee’s right to indemnification under this Agreement.

 

12.
Liability Insurance and Funding. For the duration of Indemnitee’s service as a director of the Company and for a
reasonable period of time thereafter, which such period shall be determined by the Company in its sole discretion but shall in
no event be less than two (2) years, the Company shall cause to be maintained in effect policies of directors’ and officers’
liability insurance providing coverage for directors and/or officers of the Company, that is substantially comparable in scope
and amount to that provided by the Company’s current policies of directors’ and officers’ liability insurance;
provided that the Company shall exercise its best efforts to increase the coverage limit of such policy (and not otherwise diminish
the scope or value of such coverage) to at least $3 million not later than April 1, 2021 and to at least $5 million not later
than November 1, 2021, and shall thereafter maintain in effect such coverage with a coverage limit of at least that amount and
containing no materially less favorable provisions. Upon reasonable request, the Company shall provide Indemnitee or
his or her counsel with a copy of all directors’ and officers’ liability insurance applications, binders, policies,
declarations, endorsements and other related materials. In all policies of directors’ and officers’ liability insurance
obtained by the Company, Indemnitee shall be named as an insured in such a manner as to provide Indemnitee the same rights and
benefits, subject to the same limitations, as are accorded to the Company’s directors and officers most favorably insured
by such policy. Notwithstanding the foregoing, the Company may, but shall not be required to, create a trust fund, grant a security
interest or use other means, including, without limitation, a letter of credit, to ensure the payment of such amounts as may be
necessary to satisfy its obligations to indemnify and advance expenses pursuant to this Agreement. The Company understands and
acknowledges that the Director may resign from all positions with the Company if it fails to timely implement, or to thereafter
maintain in place, such increased coverages.

 

13.
Subrogation. In the event of payment under this Agreement, the Company shall be subrogated to the extent of such payment
to all of the related rights of recovery of Indemnitee against other Persons (other than Indemnitee’s successors), including
any entity or enterprise referred to in clause (i) of the definition of “Indemnifiable Claim” in Section 1(f). Indemnitee
shall execute all papers reasonably required to evidence such rights (all of Indemnitee’s reasonable Expenses, including
reasonable attorneys’ fees and charges, related thereto to be reimbursed by or, at the option of Indemnitee, advanced by
the Company).

 

14.
No Duplication of Payments.

 

(a)
The Company shall not be liable under this Agreement to make any payment to Indemnitee in respect of any Indemnifiable Losses
to the extent Indemnitee has otherwise already actually received payment (net of Expenses incurred in connection therewith) under
any insurance policy, the Constituent Documents and Other Indemnity Provisions or otherwise (including from any entity or enterprise
referred to in clause (i) of the definition of “Indemnifiable Claim” in Section 1(f)) in respect of such Indemnifiable
Losses otherwise indemnifiable hereunder.

 

    	 

     

    

 

(b)
Notwithstanding anything to the contrary contained in Section 14(a) above, the Company hereby acknowledges that Indemnitee may
have certain rights to indemnification, advancement of expenses and/or insurance provided by one or more venture capital funds,
the general partners, managing members or other control persons and/or any affiliated management companies of such venture capital
funds, and certain of its or their affiliates (collectively, the “Fund Indemnitors”). The Company hereby
agrees that in connection with any Indemnifiable Claim, (i) it is the indemnitor of first resort (i.e., its obligations to Indemnitee
are primary and any obligation of the Fund Indemnitors to advance expenses or to provide indemnification for the same expenses
or liabilities incurred by Indemnitee are secondary), (ii) it shall be required to advance the full amount of expenses incurred
by Indemnitee and shall be liable for the full amount of all Expenses, judgments, penalties, fines and amounts paid in settlement
to the extent legally permitted and as required by the terms of this Agreement and the Company’s Constituent Documents (or
any other agreement between the Company and Indemnitee), without regard to any rights Indemnitee may have against the Fund Indemnitors,
and, (iii) it irrevocably waives, relinquishes and releases the Fund Indemnitors from any and all claims against the Fund Indemnitors
for contribution, subrogation or any other recovery of any kind in respect thereof. The Company further agrees that no advancement
or payment by the Fund Indemnitors on behalf of Indemnitee with respect to any claim for which Indemnitee has sought indemnification
from the Company shall affect the foregoing and the Fund Indemnitors shall have a right of contribution and/or be subrogated to
the extent of such advancement or payment to all of the rights of recovery of Indemnitee against the Company. The Company and
Indemnitee agree that the Fund Indemnitors are express third party beneficiaries of the terms of this Section 14(b).

 

15.
Defense of Claims. Subject to the provisions of applicable policies of directors’ and officers’ liability insurance,
if any, the Company shall be entitled to participate in the defense of any Indemnifiable Claim or to assume or lead the defense
thereof with counsel reasonably satisfactory to the Indemnitee; provided that if Indemnitee determines, after consultation
with counsel selected by Indemnitee, that (a) the use of counsel chosen by the Company to represent Indemnitee would present such
counsel with an actual or potential conflict, (b) the named parties in any such Indemnifiable Claim (including any impleaded parties)
include both the Company and Indemnitee and Indemnitee shall conclude that there may be one or more legal defenses available to
him or her that are different from or in addition to those available to the Company, (c) any such representation by such counsel
would be precluded under the applicable standards of professional conduct then prevailing, or (d) Indemnitee has interests in
the claim or underlying subject matter that are different from or in addition to those of other Persons against whom the Claim
has been made or might reasonably be expected to be made, then Indemnitee shall be entitled to retain separate counsel (but not
more than one law firm plus, if applicable, local counsel in respect of any particular Indemnifiable Claim for all indemnitees
in Indemnitee’s circumstances) at the Company’s expense. The Company shall not be liable to Indemnitee under this
Agreement for any amounts paid in settlement of any threatened or pending Indemnifiable Claim effected without the Company’s
prior written consent. The Company shall not, without the prior written consent of the Indemnitee, effect any settlement of any
threatened or pending Indemnifiable Claim to which the Indemnitee is or could have been a party unless such settlement solely
involves the payment of money and includes a complete and unconditional release of the Indemnitee from all liability on any claims
that are the subject matter of such Indemnifiable Claim. Neither the Company nor Indemnitee shall unreasonably withhold its consent
to any proposed settlement; provided that Indemnitee may withhold consent to any settlement that does not provide a complete
and unconditional release of Indemnitee.

 

16.
Mutual Acknowledgment. Both the Company and the Indemnitee acknowledge that in certain instances, Federal law or applicable
public policy may prohibit the Company from indemnifying its directors and officers under this Agreement or otherwise. Indemnitee
understands and acknowledges that the Company may be required in the future to undertake to the Securities and Exchange Commission
to submit the question of indemnification to a court in certain circumstances for a determination of the Company’s right
under public policy to indemnify Indemnitee and, in that event, the Indemnitee’s rights and the Company’s obligations
hereunder shall be subject to that determination.

 

17.
Successors and Binding Agreement.

 

(a)
This Agreement shall be binding upon and inure to the benefit of the Company and any successor to the Company, including, without
limitation, any Person acquiring directly or indirectly all or substantially all of the business or assets of the Company whether
by purchase, merger, consolidation, reorganization or otherwise (and such successor will thereafter be deemed the “Company”
for purposes of this Agreement), but shall not otherwise be assignable or delegable by the Company.

 

(b)
This Agreement shall inure to the benefit of and be enforceable by the Indemnitee’s personal or legal representatives, executors,
administrators, heirs, distributees, legatees and other successors.

 

(c)
This Agreement is personal in nature and neither of the parties hereto shall, without the consent of the other, assign or delegate
this Agreement or any rights or obligations hereunder except as expressly provided in Sections 17(a) and 17(b). Without limiting
the generality or effect of the foregoing, Indemnitee’s right to receive payments hereunder shall not be assignable, whether
by pledge, creation of a security interest or otherwise, other than by a transfer by the Indemnitee’s will or by the laws
of descent and distribution, and, in the event of any attempted assignment or transfer contrary to this Section 17(c), the Company
shall have no liability to pay any amount so attempted to be assigned or transferred.

 

    	 

     

    

 

18.
Notices. For all purposes of this Agreement, all communications, including without limitation notices, consents, requests
or approvals, required or permitted to be given hereunder must be in writing and shall be deemed to have been duly given when
hand delivered or dispatched by electronic facsimile transmission (with receipt thereof orally confirmed), or one business day
after having been sent for next-day delivery by a nationally recognized overnight courier service, addressed to the Company (to
the attention of the Secretary of the Company) and to Indemnitee at the applicable address shown on the signature page hereto,
or to such other address as any party hereto may have furnished to the other in writing and in accordance herewith, except that
notices of changes of address will be effective only upon receipt.

 

19.
Governing Law. The validity, interpretation, construction and performance of this Agreement shall be governed by and construed
in accordance with the substantive laws of the State of Delaware, without giving effect to the principles of conflict of laws
of such State. The Company and Indemnitee each hereby irrevocably consent to the jurisdiction of the courts of the State of Delaware
for all purposes in connection with any action or proceeding which arises out of or relates to this Agreement, waive all procedural
objections to suit in that jurisdiction, including, without limitation, objections as to venue or inconvenience, agree that service
in any such action may be made by notice given in accordance with Section 18 and also agree that any action instituted under this
Agreement shall be brought only in the courts of the State of Delaware.

 

20.
Validity. If any provision of this Agreement or the application of any provision hereof to any Person or circumstance is
held invalid, unenforceable or otherwise illegal, the remainder of this Agreement and the application of such provision to any
other Person or circumstance shall not be affected, and the provision so held to be invalid, unenforceable or otherwise illegal
shall be reformed to the extent, and only to the extent, necessary to make it enforceable, valid or legal. In the event that any
court or other adjudicative body shall decline to reform any provision of this Agreement held to be invalid, unenforceable or
otherwise illegal as contemplated by the immediately preceding sentence, the parties hereto shall take all such action as may
be necessary or appropriate to replace the provision so held to be invalid, unenforceable or otherwise illegal with one or more
alternative provisions that effectuate the purpose and intent of the original provisions of this Agreement as fully as possible
without being invalid, unenforceable or otherwise illegal.

 

21.
Miscellaneous. No provision of this Agreement may be waived, modified or discharged unless such waiver, modification or
discharge is agreed to in writing signed by Indemnitee and the Company. No waiver by either party hereto at any time of any breach
by the other party hereto or compliance with any condition or provision of this Agreement to be performed by such other party
shall be deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time. No
agreements or representations, oral or otherwise, expressed or implied with respect to the subject matter hereof have been made
by either party hereto that is not set forth expressly in this Agreement.

 

22.
Certain Interpretive Matters. Unless the context of this Agreement otherwise requires, (1) “it” or “its”
or words of any gender include each other gender, (2) words using the singular or plural number also include the plural or singular
number, respectively, (3) the terms “hereof,” “herein,” “hereby” and derivative or similar
words refer to this entire Agreement, (4) the terms “Article,” “Section,” “Annex” or “Exhibit”
refer to the specified Article, Section, Annex or Exhibit of or to this Agreement, (5) the terms “include,” “includes”
and “including” will be deemed to be followed by the words “without limitation” (whether or not so expressed),
and (6) the word “or” is disjunctive but not exclusive. Whenever this Agreement refers to a number of days, such number
will refer to calendar days unless business days are specified and whenever action must be taken (including the giving of notice
or the delivery of documents) under this Agreement during a certain period of time or by a particular date that ends or occurs
on a non-business day, then such period or date will be extended until the immediately following business day. As used herein,
“business day” means any day other than Saturday, Sunday or a United States federal holiday.

 

23.
Entire Agreement. This Agreement constitutes the entire agreement and supersedes all prior agreements and understandings,
both written and oral, between the parties hereto with respect to the subject matter of this Agreement. Any prior agreements or
understandings between the parties hereto with respect to indemnification are hereby terminated and of no further force or effect.
This Agreement is not the exclusive means of securing indemnification rights of Indemnitee and is in addition to any rights Indemnitee
may have under any Constituent Documents.

 

24.
Counterparts. This Agreement may be executed in one or more counterparts, each of which will be deemed to be an original
but all of which together shall constitute one and the same agreement.

 

25.
Duration of Agreement. This Agreement shall continue until and terminate upon the later of: (a) six years after the date
that the Indemnitee shall have ceased to serve as a director, officer, employee, agent or fiduciary of the Company or of any other
corporation, partnership, joint venture, trust, employee benefit plan or other enterprise which the Indemnitee served at the request
of the Company; (b) the expiration of the applicable statutes of limitations pertaining to any and all potential proceedings covered
by the indemnification provided for herein; or (c) the final termination of all pending proceedings in respect of which the Indemnitee
is granted rights of indemnification or advancement of Expenses hereunder and of any proceeding commenced by the Indemnitee pursuant
to this Agreement relating thereto.

 

[REMAINDER
OF PAGE INTENTIONALLY BLANK]

 

    	 

     

    

 

IN
WITNESS WHEREOF, Indemnitee has executed and the Company has caused its duly authorized representative to execute this Agreement
as of the date first above written.

 

	CONVERSION
    LABS, INC.	 
	 	 	 
	By:		 
	 	Justin
Schreiber	 
	 	Chief
Executive Officer	 
	 	 	 
	INDEMNITEE:	 
	 	 	 
	 	 
	Roberto Simon, an individual	 

 

[Signature
page to Indemnification Agreement]

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