Document:

Exhibit 4.3

 

THIS WARRANT AND THE SECURITIES ISSUABLE
UPON THE EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THEY MAY NOT BE SOLD, OFFERED
FOR SALE, PLEDGED, HYPOTHECATED OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT OF 1933, AS AMENDED, OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT REGISTRATION IS NOT REQUIRED UNDER SUCH ACT
OR UNLESS SOLD IN ACCORDANCE WITH RULE 144 UNDER SUCH ACT.

 

	WARRANT NO. [●]	NUMBER OF SHARES: [●]

DATE OF ISSUANCE: [●]

EXPIRATION DATE: [●]

 

FORM OF WARRANT TO PURCHASE SHARES

OF COMMON STOCK OF

 

SMARTKEM, INC.

 

This Warrant is issued
to [●], or its registered assigns (including any successors or assigns, the “Warrantholder”), by SmartKem,
Inc. (f/k/a ______________), a Delaware corporation (the “Company”).

 

1.           EXERCISE
OF WARRANT.

 

(a)          Number
and Exercise Price of Warrant Shares; Expiration Date. Subject to the terms and conditions set forth herein at any time beginning
on or after the date hereof (the “Initial Exercise Date”) and ending on or before 5:00 p.m. New York City time
on the fifth anniversary of the Initial Exercise Date (the “Expiration Date”), the Warrantholder is entitled
to purchase from the Company up to [●] shares of the Company’s Common Stock, $0.0001 par value per share (the “Common
Stock”) (as adjusted from time to time pursuant to the provisions of this Warrant) (the “Warrant Shares”),
at a purchase price of $2.00 per share (the “Exercise Price”) (subject to earlier termination of this Warrant
as set forth herein).

 

(b)         Method
of Exercise. While this Warrant remains outstanding and exercisable in accordance with Section 1(a) above, the Warrantholder
may exercise this Warrant in accordance with Section 5 herein, by either:

 

(1)            
wire transfer to the Company or cashier’s check drawn on a United States bank made payable to the order of the Company,
or

 

(2)            
exercising of the right to credit the Exercise Price against the Fair Market Value of the Warrant Shares (as defined below)
at the time of exercise (the “Net Exercise”) pursuant to Section 1(c).

 

Notwithstanding anything
herein to the contrary, the Warrantholder shall not be required to physically surrender this Warrant to the Company until the
Warrantholder has purchased all of the Warrant Shares available hereunder and the Warrant has been exercised in full, in which
case, the Warrantholder shall surrender this Warrant to the Company for cancellation within three (3) trading days of the date
the final Notice of Exercise is delivered to the Company. Partial exercises of this Warrant resulting in purchases of a portion
of the total number of Warrant Shares available hereunder shall have the effect of lowering the outstanding number of Warrant
Shares purchasable hereunder in an amount equal to the applicable number of Warrant Shares purchased. The Warrantholder and the
Company shall maintain records showing the number of Warrant Shares purchased and the date of such purchases.

 

    	 	 

     

    

 

(c)           Net
Exercise. If the Company shall receive written notice from the Warrantholder at the time of exercise of this Warrant that
the holder elects to Net Exercise the Warrant, the Company shall deliver to such Warrantholder (without payment by the Warrantholder
of any exercise price in cash) that number of Warrant Shares computed using the following formula:

 

X =       Y
(A - B)

A

 

Where

 

		X =	The number of Warrant Shares to be issued to the Warrantholder.

 

		Y =	The number of Warrant Shares purchasable under this Warrant or,
                                         if only a portion of this Warrant is being exercised, the number of Warrant Shares for
                                         which this Warrant is being exercised.

 

		A =	The Fair Market Value of one (1) share of Common Stock on the
                                         trading date immediately preceding the date on which Warrantholder elects to exercise
                                         this Warrant.

 

		B =	The Exercise Price (as adjusted hereunder).

 

The “Fair
Market Value” of one share of Common Stock shall mean (x) the last reported sale price and, if there are no sales, the
last reported bid price, of the Common Stock on the business day prior to the date of exercise on the Trading Market on which
the Common Stock is then listed or quoted as reported by Bloomberg Financial Markets (or a comparable reporting service of national
reputation selected by the Company and reasonably acceptable to the holder if Bloomberg Financial Markets is not then reporting
sales prices of the Common Stock) (collectively, “Bloomberg”), (y) if the foregoing does not apply, the last
sales price of the Common Stock in the over-the-counter market on the pink sheets or bulletin board for such security as reported
by Bloomberg, and, if there are no sales, the last reported bid price of the Common Stock as reported by Bloomberg or, (z) if
fair market value cannot be calculated as of such date on either of the foregoing bases, the price determined in good faith by
the Company’s Board of Directors.

 

“OTC Markets”
shall mean either OTC QX or OTC QB of the OTC Markets Group, Inc.

 

“Trading
Market” shall mean any of the following markets or exchanges on which the Common Stock is listed or quoted for trading
on the date in question: the NYSE American, the Nasdaq Capital Market, the Nasdaq Global Market, the Nasdaq Global Select Market,
the New York Stock Exchange or the OTC Markets (or any successors to any of the foregoing).

 

    	 	- 2 -	 

     

    

 

2.           CERTAIN
ADJUSTMENTS.

 

(a)           Adjustment
of Number of Warrant Shares and Exercise Price. The number and kind of Warrant Shares purchasable upon exercise of this Warrant
and the Exercise Price shall be subject to adjustment from time to time as follows:

 

(1)              
Subdivisions, Combinations and Other Issuances. If the Company shall at any time after the Date of Issuance but
prior to the Expiration Date subdivide its shares of capital stock of the same class as the Warrant Shares, by split-up or otherwise,
or combine such shares of capital stock, or issue additional shares of capital stock as a dividend with respect to any shares
of such capital stock, or effect any forward stock split or reverse stock split of its capital stock of the same class as the
Warrant Shares, the number of Warrant Shares issuable on the exercise of this Warrant shall forthwith be proportionately increased
in the case of a subdivision, stock dividend or forward stock split, or proportionately decreased in the case of a reverse stock
split or other combination. Appropriate adjustments shall also be made to the Exercise Price payable per share, but the aggregate
Exercise Price payable for the total number of Warrant Shares purchasable under this Warrant (as adjusted) shall remain the same.
Any adjustment under this Section 2(a)(1) shall become effective at the close of business on the date the subdivision or
combination becomes effective, or as of the record date of such dividend, or in the event that no record date is fixed, upon the
making of such dividend.

 

(2)              
Reclassification, Reorganizations and Consolidation. In case of any reclassification, capital reorganization or
change in the capital stock of the Company (other than as a result of a subdivision, combination or stock dividend provided for
in Section 2(a)(1) above) that occurs after the Date of Issuance (whether prior to, on or subsequent to the Initial Exercise
Date), then, as a condition of such reclassification, reorganization or change, lawful provision shall be made, and duly executed
documents evidencing the same from the Company or its successor shall be delivered to the Warrantholder, so that the Warrantholder
shall thereafter have the right at any time prior to the Expiration Date to purchase, at a total price equal to that payable upon
the exercise of this Warrant, the kind and amount of shares of stock and/or other securities or property (including, if applicable,
cash) receivable in connection with such reclassification, reorganization or change by a holder of the same number and type of
securities as were purchasable as Warrant Shares by the Warrantholders immediately prior to such reclassification, reorganization
or change. In any such case appropriate provisions shall be made with respect to the rights and interest of the Warrantholder
so that the provisions hereof shall thereafter be applicable with respect to any shares of stock or other securities or property
deliverable upon exercise hereof, and appropriate adjustments shall be made to the Exercise Price payable hereunder, provided
the aggregate Exercise Price shall remain the same (and, for the avoidance of doubt, this Warrant shall be exclusively exercisable
for such shares of stock and/or other securities or property from and after the consummation of such reclassification or other
change in the capital stock of the Company).

 

(b)          Notice
to Warrantholder. If, while this Warrant is outstanding (whether prior to, on or subsequent to the Initial Exercise Date),
the Company (i) declares a dividend or any other distribution of cash, securities or other property in respect of its Common Stock,
including, without limitation, any granting of rights or warrants to subscribe for or purchase any capital stock of the Company
or any subsidiary, (ii) authorizes or approves, enters into any agreement contemplating or solicits stockholder approval for any
Fundamental Transaction or (iii) authorizes the voluntary dissolution, liquidation or winding up of the affairs of the Company,
then the Company shall deliver to the Warrantholder a notice of such transaction at least ten (10) business days prior to the
applicable record or effective date on which a person would need to hold Common Stock in order to participate in or vote with
respect to such transaction; provided, however, that the failure to deliver such notice or any defect therein shall not affect
the validity of the corporate action required to be described in such notice.

 

    	 	- 3 -	 

     

    

 

(c)         Calculations.
All calculations under this Section 2 shall be made to the nearest cent or the nearest whole share, as the case may be.
For purposes of this Section 2, the number of shares of Common Stock deemed to be issued and outstanding as of a given
date shall be the sum of the number of shares of Common Stock (excluding treasury shares, if any) issued and outstanding.

 

(d)          Treatment
of Warrant upon a Fundamental Transaction.

 

(1)              
If, at any time while this Warrant is outstanding, (i) the Company, directly or indirectly, in one or more related transactions
effects any merger or consolidation of the Company with or into another person, (ii) the Company, directly or indirectly, effects
any sale, lease, license, assignment, transfer, conveyance or other disposition of all or substantially all of its assets in one
or a series of related transactions, (iii) any, direct or indirect, purchase offer, tender offer or exchange offer (whether by
the Company or another person) is completed pursuant to which holders of Common Stock are permitted to sell, tender or exchange
their shares for other securities, cash or property and has been accepted by the holders of 50% or more of the outstanding Common
Stock, (iv) the Company, directly or indirectly, in one or more related transactions effects any reclassification, reorganization
or recapitalization of the Common Stock or any compulsory share exchange pursuant to which the Common Stock is effectively converted
into or exchanged for other securities, cash or property, (v) the Company, directly or indirectly, in one or more related transactions
consummates a stock or share purchase agreement or other business combination (including, without limitation, a reorganization,
recapitalization, spin-off or scheme of arrangement) with another person or group of persons whereby such other person or group
acquires more than 50% of the outstanding shares of Common Stock (not including any shares of Common Stock held by the other person
or other persons making or party to, or associated or affiliated with the other persons making or party to, such stock or share
purchase agreement or other business combination) (each a “Fundamental Transaction”), then, upon any subsequent
exercise of this Warrant, the Warrantholder shall have the right to receive, for each Warrant Share that would have been issuable
upon such exercise immediately prior to the occurrence of such Fundamental Transaction, at the option of the Warrantholder, the
number, class, and series of shares of stock of the successor or acquiring corporation or of the Company, if it is the surviving
corporation, and any additional consideration (the “Alternate Consideration”) receivable as a result of such
Fundamental Transaction by a holder of the number of shares of Common Stock for which this Warrant is exercisable immediately
prior to such Fundamental Transaction.  For purposes of any such exercise, the determination of the Exercise Price shall
be appropriately adjusted to apply to such Alternate Consideration based on the amount of Alternate Consideration issuable in
respect of one share of Common Stock in such Fundamental Transaction, and the Company shall apportion the Exercise Price among
the Alternate Consideration in a reasonable manner reflecting the relative value of any different components of the Alternate
Consideration.  If holders of Common Stock are given any choice as to the securities, cash or property to be received in
a Fundamental Transaction, then the Warrantholder shall be given the same choice as to the Alternate Consideration it receives
upon any exercise of this Warrant following such Fundamental Transaction.  The Company shall cause any successor entity in
a Fundamental Transaction in which the Company is not the survivor (the “Successor Entity”) to assume in writing
all of the obligations of the Company under this Warrant and the other transaction documents in accordance with the provisions
of this Section 2(d)(1) pursuant to written agreements in form and substance reasonably satisfactory to the Warrantholder
and approved by the Warrantholder (without unreasonable delay) prior to such Fundamental Transaction and shall, at the option
of the Warrantholder, deliver to the Warrantholder in exchange for this Warrant a security of the Successor Entity evidenced by
a written instrument substantially similar in form and substance to this Warrant which is exercisable for a corresponding number
of shares of capital stock of such Successor Entity (or its parent entity) equivalent to the shares of Common Stock acquirable
and receivable upon exercise of this Warrant (without regard to any limitations on the exercise of this Warrant) prior to such
Fundamental Transaction, and with an exercise price which applies the exercise price hereunder to such shares of capital stock
(but taking into account the relative value of the shares of Common Stock pursuant to such Fundamental Transaction and the value
of such shares of capital stock, such number of shares of capital stock and such exercise price being for the purpose of protecting
the economic value of this Warrant immediately prior to the consummation of such Fundamental Transaction), and which is reasonably
satisfactory in form and substance to the Warrantholder. Upon the occurrence of any such Fundamental Transaction, the Successor
Entity shall succeed to, and be substituted for (so that from and after the date of such Fundamental Transaction, the provisions
of this Warrant and the other transaction documents referring to the “Company” shall refer instead to the Successor
Entity), and may exercise every right and power of the Company and shall assume all of the obligations of the Company under this
Warrant and the other transaction documents with the same effect as if such Successor Entity had been named as the Company herein.

 

    	 	- 4 -	 

     

    

 

3.           NO
FRACTIONAL SHARES. No fractional Warrant Shares or scrip representing fractional shares will be issued upon exercise of this Warrant.
In lieu of any fractional shares which would otherwise be issuable, the Company shall pay cash equal to the product of such fraction
multiplied by the Fair Market Value of one Warrant Share.

 

4.           NO
STOCKHOLDER RIGHTS. Until the exercise of this Warrant or any portion of this Warrant, the Warrantholder shall not have, nor
exercise, any rights as a stockholder of the Company (including without limitation the right to notification of stockholder
meetings or the right to receive any notice or other communication concerning the business and affairs of the Company) except
as provided in Section 8 below.

 

5.             MECHANICS
OF EXERCISE.

 

(a)           Delivery
of Warrant Shares Upon Exercise. This Warrant may be exercised by the holder hereof, in whole or in part, by delivering to
the Company (or such other office or agency of the Company as it may designate by notice in writing to the registered Warrantholder
at the address of the Warrantholder appearing on the books of the Company) of a duly completed and executed copy of the Notice
of Exercise in the form attached hereto as Exhibit A by facsimile or e-mail attachment and paying the Exercise Price (unless
the Warrantholder has elected to Net Exercise) then in effect with respect to the number of Warrant Shares as to which the Warrant
is being exercised. This Warrant shall be deemed to have been exercised immediately prior to the close of business on the date
of the delivery to the Company of the Notice of Exercise as provided above, and the person entitled to receive the Warrant Shares
issuable upon such exercise shall be treated for all purposes as the holder of such shares of record as of the close of business
on such date. Warrant Shares purchased hereunder shall be transmitted by the Company’s transfer agent to the holder by crediting
the account of the holder’s prime broker with The Depository Trust Company through its Deposit or Withdrawal at Custodian
system (“DWAC”) if the Company is then a participant in such system and either (A) there is an effective registration
statement covering the resale of the Warrant Shares by the holder and the Warrantholder has certified to the Company that it has
sold or otherwise disposed of the Warrant Shares in accordance with the plan of distribution set forth in such registration statement
or (B) the shares are eligible for resale by the holder pursuant to Rule 144 and the Warrantholder has certified to the Company
that is has sold the Warrant Shares in accordance with the requirements of such Rule, and otherwise in book entry form or by physical
delivery to the address specified by the holder in the Notice of Exercise by the end of the day (such date, the “Warrant
Share Delivery Date”) on the date that is two (2) trading days from the delivery to the Company of the Notice of Exercise
and payment of the aggregate Exercise Price (unless exercised by means of a cashless exercise pursuant to Section 1(c)).
The Warrant Shares shall be deemed to have been issued, and the holder or any other person so designated to be named therein shall
be deemed to have become a holder of record of such shares for all purposes, as of the date the Warrant has been exercised, with
payment to the Company of the Exercise Price (or by Net Exercise) and all taxes required to be paid by the holder, if any, prior
to the issuance of such shares, having been paid.

 

    	 	- 5 -	 

     

    

 

(b)           Rescission
Rights. If the Company fails to cause the transfer agent to transmit to the Warrantholder the Warrant Shares pursuant to Section
5(a) by the Warrant Share Delivery Date, then the Warrantholder will have the right to rescind such exercise.

 

6.           CERTIFICATE
OF ADJUSTMENT. Whenever the Exercise Price or number or type of securities issuable upon exercise of this Warrant is adjusted,
as herein provided, the Company shall, at its expense, promptly deliver to the Warrantholder a certificate of an officer of the
Company setting forth the nature of such adjustment and showing in detail the facts upon which such adjustment is based.

  

7.            COMPLIANCE
WITH SECURITIES LAWS.

 

(a)           The
Warrantholder understands that this Warrant and the Warrant Shares are characterized as “restricted securities” under
the federal securities laws inasmuch as they are being acquired from the Company in a transaction not involving a public offering
and that under such laws and applicable regulations this Warrant and the Warrant Shares may be resold without registration under
the Securities Act only in certain limited circumstances. In this connection, the Warrantholder represents that it is familiar
with Rule 144 under the Securities Act, as presently in effect, and understands the resale limitations imposed thereby and by
the Securities Act. The Warrantholder represents, covenants and agrees that as of the date hereof, it is, and on each date on
which it exercises the Warrants it will be, an “accredited investor” as defined in Rule 501(a) under the Securities
Act.

 

(b)           Prior
and as a condition to the sale or transfer of the Warrant Shares issuable upon exercise of this Warrant, the Warrantholder shall
furnish to the Company such certificates, representations, agreements and other information, including an opinion of counsel,
as the Company or the Company’s transfer agent reasonably may require to confirm that such sale or transfer is being made
pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act, unless
such Warrant Shares are being sold or transferred pursuant to an effective registration statement and the Warrantholder has certified
to the Company that such sale or transfer has been made in accordance with the plan of distribution contained in such registration
statement.

 

    	 	- 6 -	 

     

    

 

(c)           The
Warrantholder acknowledges that the Company may place a restrictive legend on the Warrant Shares issuable upon exercise of this
Warrant in order to comply with applicable securities laws, in substantially the following form and substance:

 

“THE SECURITIES REPRESENTED
BY THIS BOOK-ENTRY POSITION HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, AND THE RULES AND REGULATIONS PROMULGATED THEREUNDER (THE “SECURITIES ACT”),
OR ANY STATE SECURITIES LAWS, AND NEITHER SUCH SECURITIES NOR ANY INTEREST THEREIN MAY BE OFFERED, SOLD, PLEDGED, ASSIGNED OR
OTHERWISE TRANSFERRED UNLESS (1) A REGISTRATION STATEMENT WITH RESPECT THERETO IS EFFECTIVE UNDER THE SECURITIES ACT AND
ANY APPLICABLE STATE SECURITIES LAWS, OR (2) AN EXEMPTION FROM SUCH REGISTRATION EXISTS AND THE COMPANY RECEIVES AN OPINION
OF COUNSEL, WHICH COUNSEL AND OPINION ARE REASONABLY SATISFACTORY TO THE COMPANY, THAT SUCH SECURITIES MAY BE OFFERED, SOLD, PLEDGED,
ASSIGNED OR TRANSFERRED IN THE MANNER CONTEMPLATED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR APPLICABLE
STATE SECURITIES LAWS OR (3) SOLD PURSUANT TO RULE 144 UNDER THE SECURITIES ACT.”

 

8.           REPLACEMENT
OF WARRANTS. On receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of this
Warrant and, in the case of any such loss, theft or destruction of this Warrant, on delivery of an indemnity agreement reasonably
satisfactory in form and amount to the Company or, in the case of any such mutilation, on surrender and cancellation of such Warrant,
the Company at its expense will execute and deliver, in lieu thereof, a new Warrant of like tenor.

 

9.            NO
IMPAIRMENT. Except to the extent as may be waived by the holder of this Warrant, the Company will not, by amendment of its charter
or through a Fundamental Transaction, dissolution, sale of assets or any other voluntary action, avoid or seek to avoid the observance
or performance of any of the terms of this Warrant, but will at all times in good faith assist in the carrying out of all such
terms and in the taking of all such action as may be necessary or appropriate in order to protect the rights of the Warrantholder
against impairment.

 

    	 	- 7 -	 

     

    

 

10.          TRADING
DAYS. If the last or appointed day for the taking of any action or the expiration of any right required or granted herein shall
be other than a day on which the Common Stock is traded on the Trading Market, then such action may be taken or such right may
be exercised on the next succeeding day on which the Common Stock is so traded.

 

11.          TRANSFERS;
EXCHANGES.

 

(a)           Subject
to compliance with applicable federal and state securities laws and Section 7 hereof, this Warrant may be transferred by
the Warrantholder to any Affiliate (as defined below) with respect to any or all of the Warrant Shares purchasable hereunder (a
 “Permitted Transfer”). For a transfer of this Warrant as an entirety by the Warrantholder, upon surrender of
this Warrant to the Company, together with the Notice of Assignment in the form attached hereto as Exhibit B duly completed
and executed on behalf of the Warrantholder, and an opinion of counsel of the Warrantholder in form and substance reasonably satisfactory
to the Company that such transfer may be made without registration under the Securities Act and applicable state securities laws,
the Company shall issue a new Warrant of the same denomination to the assignee. For a transfer of this Warrant with respect to
a portion of the Warrant Shares purchasable hereunder, upon surrender of this Warrant to the Company, together with the Notice
of Assignment in the form attached hereto as Exhibit B duly completed and executed on behalf of the Warrantholder, and
an opinion of counsel of the Warrantholder in form and substance reasonably satisfactory to the Company that such transfer may
be made without registration under the Securities Act and applicable state securities laws, the Company shall issue a new Warrant
to the assignee, in such denomination as shall be requested by the Warrantholder, and shall issue to the Warrantholder a new Warrant
covering the number of shares in respect of which this Warrant shall not have been transferred. The term “Affiliate”
as used herein means, with respect to any person, any other person that, directly or indirectly through one or more intermediaries,
controls, is controlled by or is under common control with such person, and any officers, employees or partners of the Warrantholder.

 

(b)           Upon
any Permitted Transfer, this Warrant is exchangeable, without expense, at the option of the Warrantholder, upon presentation and
surrender hereof to the Company for other warrants of different denominations entitling the holder thereof to purchase in the
aggregate the same number of shares of Common Stock purchasable hereunder. This Warrant may be divided or combined with other
warrants that carry the same rights upon presentation hereof at the principal office of the Company together with a written notice
specifying the denominations in which new warrants are to be issued to the Warrantholder and signed by the Warrantholder hereof.
The term “Warrants” as used herein includes any warrants into which this Warrant may be divided or exchanged.

 

12.          VALID
ISSUANCE; AUTHORIZED SHARES. The Company hereby represents, covenants and agrees that: (i) this Warrant is, and any Warrant issued
in substitution for or replacement of this Warrant shall be, upon issuance, a valid and legally binding obligation of the Company,
enforceable against the Company in accordance with its terms; (ii) the issuance of this Warrant shall constitute full authority
to the Company’s officers who are charged with the duty of issuing the necessary Warrant Shares upon the exercise of the
purchase rights under this Warrant; (iii) all Warrant Shares issuable upon exercise of the purchase rights represented by this
Warrant and payment for such Warrant Shares in accordance herewith shall be, upon issuance, validly issued, fully paid and non-assessable,
issued without violation of any preemptive or similar rights of any stockholder of the Company and free and clear of all taxes,
liens and charges created by the Company in respect of the issue thereof (other than taxes in respect of any transfer occurring
contemporaneously with such issue); and (iv) during the period the Warrant is outstanding, the Company shall reserve from its
authorized and unissued Common Stock a sufficient number of shares to provide for the issuance of the Warrant Shares upon the
exercise of any purchase rights under this Warrant.

 

    	 	 	 

     

    

 

13.          MISCELLANEOUS.

 

(a)           This
Agreement shall be governed by and construed in accordance with the laws of the State of New York, without regard to New York
conflicts of law principles. Any judicial proceeding brought under this Agreement or any dispute arising out of this Agreement
or any matter related hereto shall be brought in the courts of the State of New York, New York County, or in the United States
District Court for the Southern District of New York.

 

(b)           All
notices, requests, consents and other communications hereunder shall be in writing, shall be sent by confirmed facsimile or electronic
mail, or mailed by first-class registered or certified airmail, or nationally recognized overnight express courier, postage prepaid,
and shall be deemed given when so sent in the case of facsimile or electronic mail transmission, or when so received in the case
of mail or courier, and addressed as follows: (a) if to the Company, to Manchester Technology Center, Hexagon Tower, Delaunays
Road, Blackley, Manchester, M9 8GQ UK, Attention: Ian Jenks, E-Mail:i.jenks@smartkem.com, with a copy to (which shall not constitute
notice) Lowenstein Sandler LLP, 1251 Avenue of the Americas, New York, NY 10020, Attention: John Hogoboom, Esq., E-Mail: jhogoboom@lowenstein.com;
and (b) if to the Warrantholder, at such address or addresses (including copies to counsel) as set forth below.

 

(c)           The
invalidity or unenforceability of any provision hereof shall in no way affect the validity or enforceability of any other provisions.

 

[Signature Page Follows]

 

    	 	- 8 -	 

     

    

 

IN WITNESS WHEREOF,
this Common Stock Purchase Warrant is issued effective as of the date first set forth above.

 

	 	SMARTKEM, INC.
	 	 
	 	 
	 	By: 	          
	 	Name: Ian Jenks
	 	Title:   Chief Executive Officer

 

    	 	 	 

     

    

 

EXHIBIT A

 

NOTICE OF EXERCISE

(To be signed only upon exercise of Warrant)

 

To:         SmartKem,
Inc.

 

The undersigned, the
Warrantholder of the attached Warrant, hereby irrevocably elects to exercise the purchase right represented by such Warrant for,
and to purchase thereunder, _______________ (__________) shares of Common Stock of SmartKem, Inc. and (choose one)

 

__________ herewith makes payment
of __________ dollars ($__________) thereof

 

or

 

__________ elects to Net Exercise
the Warrant pursuant to Section 1(b)(2) thereof.

 

The undersigned requests
that the certificates or book entry position evidencing the shares to be acquired pursuant to such exercise be issued in the name
of, and delivered to _____________________________________________________________, whose address is ________________________________________________________________________________________________________________________.

 

By its signature below
the undersigned hereby represents and warrants that it is an “accredited investor” as defined in Rule 501(a) of Regulation
D promulgated under the Securities Act of 1933, as amended, and agrees to be bound by the terms and conditions of the attached
Warrant as of the date hereof, including Section 7 thereof.

 

DATED:

 

 

	 	(Signature must conform in all respects to name of the Warrantholder as specified
    on the face of the Warrant)
	 	 
	 	                                                                                                          
	 	[_____________]
	 	Address:                                                                                          
	 	                                                                                                          
	 	                                                                                                          

 

 

Exhibit A

  

    	 	 	 

     

    

 

EXHIBIT B

 

NOTICE OF ASSIGNMENT FORM

 

FOR VALUE RECEIVED,
[__________] (the “Assignor”) hereby sells, assigns and transfers all of the rights of the undersigned Assignor
under the attached Warrant with respect to the number of shares of common stock of SmartKem, Inc. (the “Company”)
covered thereby set forth below, to the following “Assignee” and, in connection with such transfer, represents
and warrants to the Company that the transfer is in compliance with Section 7 of the Warrant and applicable federal and
state securities laws:

 

	NAME OF ASSIGNEE	 	ADDRESS/FAX NUMBER

         

         

         

         

	Number of shares:
	 
	 
	 
	 	 	 
	Dated:  	 	 	Signature:
	 

	 	 	 
	 	 	Witness:
	 

 

 

Exhibit B

 

    	 	 	 

     

    

 

ASSIGNEE ACKNOWLEDGMENT

 

The undersigned Assignee
acknowledges that it has reviewed the attached Warrant and by its signature below it hereby represents and warrants that it is
an “accredited investor” as defined in Rule 501(a) of Regulation D promulgated under the Securities Act of 1933, as
amended, and agrees to be bound by the terms and conditions of the Warrant as of the date hereof, including Section 7 thereof.

 

	 	 	Signature:  	 

 

	 	 	By:  	 
	 	 	Its:  	 
	Address:	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 
	E-Mail Address:	 	 	 
	 	 	 	 
	 	 	 	 
	 	 	 	 

 

 

Exhibit BExhibit 10.1

 

	 	GP NURMENKARI INC.
	 	22 ELIZABETH STREET
	 	SONO SQUARE, SUITE 1J
	 	NORWALK, CT 06854

 

December 15, 2020

 

PERSONAL
AND CONFIDENTIAL

 

SmartKem
Limited

Manchester
Technology Center, Hexagon Tower

Delaunays
Road, Blackley

Manchester,
M9 8GQ UK

 

Attention:
Mr. Ian Jenks

Chairman
and Chief Executive Officer

 

Gentleman:

 

This
letter agreement (this “Agreement”) between GP Nurmenkari Inc. (“GPN”) and SmartKem Limited, a United Kingdom
corporation (the “Company”), confirms our understanding of the basis upon which GPN is being engaged to act as the
exclusive placement agent for the Company, in seeking, arranging, negotiating, and generally advising with respect to a Financing
(as defined below). The Company has informed GPN that the Company intends to enter into a share exchange, reverse triangular
merger or similar transaction (each a “Business Combination”) with a Delaware corporation whose common stock is registered
under, and which is filing and has filed with the Securities and Exchange Commission all required reports under, the Securities
Exchange Act of 1934, as amended (the “Exchange Act”), but whose stock is yet not traded or approved for trading on
any quotation system or exchange (“Pubco”) pursuant to which the entire issued share capital of the Company will be
exchanged for shares of Pubco common stock (“Common Stock”), and the Company will become a wholly owned subsidiary
of Pubco. Contemporaneous with the Business Combination, it is expected that Pubco will conduct a private placement of Common Stock
of Pubco (the “Financing”). The terms of the Financing are described in greater detail in the Term Sheet between the
Company and Montrose Capital Partners Limited dated November 18, 2020, a copy of which is attached hereto as Exhibit A.

 

	 	I.	Services of GPN

 

GPN will
use its commercially reasonable “best efforts” to obtain one or more commitments for the Financing (individually a
 “Commitment” and collectively the “Commitments”) from one or more accredited investors (the “Investors”).
During the term of the Agreement, GPN may perform or cause one or more of its affiliates to perform, and the Company hereby grants
GPN and its affiliates the exclusive right and authority to perform, the following services:

 

	A.	Contact and seek to elicit interest from one or more Investors to participate
in the Financing; provided, however, that GPN and its affiliates shall only contact those potential Investors with which either
they or the Company have a previous relationship.

 

	B.	Coordinate inquiries from and assist in the preparation of additional Transaction
Documents providing such information and analyses as may be reasonably requested by Investors and authorized in advance by the
Company.

 

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	 	GP NURMENKARI INC.
	 	22 ELIZABETH STREET
	 	SONO SQUARE, SUITE 1J
	 	NORWALK, CT 06854

 

	C.	Assist the Company in closing the Financing after a Commitment is procured.

 

The
Company hereby grants GPN the exclusive right and authority to locate Financing sources and to obtain Commitments during the term
of this Agreement. If the Company accepts or otherwise enters into any Commitment during the term of this Agreement and the Company
closes the Financing under such Commitment, the Company expressly agrees that GPN’s services have been fully performed as
outlined herein, and the Company shall pay GPN compensation as outlined herein.

 

The
Company may accept or reject any Commitments, in whole or in part, in its sole discretion. The parties understand and agree that
neither the Company nor GPN shall have any obligation to consummate a Financing.

 

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GP Nurmenkari Inc.

December 15, 2020

 

	 	II.	Representations, Warranties, Terms, and Conditions

 

The Company hereby represents
and warrants to, and agrees with, GPN, and GPN hereby represents and warrants to, and agrees with, the Company as follows:

 

	A.	This Agreement has been duly authorized, executed and delivered by the Company,
and upon due execution and delivery by GPN, this Agreement will be a valid and binding agreement of the Company enforceable against
it in accordance with its terms, except as may be limited by principles of public policy and, as to enforceability, subject to
applicable bankruptcy, insolvency, reorganization, moratorium and similar laws relating to or affecting creditor’s rights
from time to time in effect and subject to general equity principles.

 

	B.	The Company acknowledges that the Customer Due Diligence Requirements for
Financial Institutions Rule (the “CDD Rule”) promulgated by the Financial Crimes Enforcement Network (“FinCEN”)
requires GPN to identify and verify the identity of beneficial owners of its legal entity clients. Unless an exemption to the CDD
Rule applies, the Company agrees to cooperate with, and provide to, GPN all information and documents reasonably required by FinCEN
in order to comply with the CDD Rule.

 

	C.	The Company will furnish GPN with all information and material concerning
the Company and the Financing which GPN reasonably requests in connection with the performance of its obligations hereunder. The
Company represents and warrants that all information made available to GPN by the Company will, at all times during the period
of the engagement of GPN hereunder, be complete and correct in all material respects and will not contain any untrue statement
of a material fact or omit to state a material fact necessary in order to make the statements therein, in light of the circumstances
under which such statements are made, not misleading. The Company further represents and warrants that any projections provided
to GPN or contained in the Transaction Documents will have been prepared in good faith and will be based upon assumptions which,
in light of the circumstances under which they are made, are reasonable. The Company acknowledges and agrees that in rendering
its services hereunder, GPN will be using and relying upon, without any independent investigation or verification thereof, all
information that is or will be furnished to GPN by or on behalf of the Company and on publicly available information, and GPN will
not in any respect be responsible for the accuracy or completeness of any of the foregoing kinds of information, and that GPN will
not undertake to make an independent appraisal of any of the assets of the Company. The Company understands that in rendering services
hereunder GPN does not provide accounting, legal, or tax advice and will rely upon the advice of counsel to the Company and other
advisors to the Company as to accounting, legal, tax, and other matters relating to the Financing or any other transaction contemplated
by this Agreement.

 

	D.	In connection with engagements of the nature covered by this Agreement, it
is GPN’s practice to provide for indemnification, contribution, and limitation of liability. By signing this Agreement, the
Company agrees to the provisions attached to this Agreement (Attachment A), which provisions are expressly incorporated by reference
herein.

 

	E.	The Company shall timely make or cause to be made state “blue sky”
applications in such states and jurisdictions as shall be reasonably requested by GPN in order to qualify the Common Stock for
sale, including a Connecticut filing. It shall be the Company’s obligation to bear all blue-sky counsel fees and expenses.
The Company shall provide copies of all such blue sky filing to GPN.

 

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GP Nurmenkari Inc.

December 15, 2020

 

	F.	It is understood that the offer and sale of the securities sold in the Financing
(the “Securities”) will be exempt from the registration requirements of the Securities Act of 1933, as amended (the
 “Act”) pursuant to Rule 506(b) of Regulation D as promulgated under the Act. The Company will not, directly or indirectly,
make any offer or sale of Securities or of securities of the same or a similar class as the Securities if as a result the offer
and sale of Securities contemplated hereby would fail to be entitled to an exemption from the registration requirements of the
Act. As used herein, the terms “offer” and “sale” have the meanings specified in Section 2(a)(3) of the
Act.

 

	G.	The Company hereby represents and warrants to GPN that: (i) as of the date
hereof, the Company is not subject to any of the disqualifying events stated in paragraph (d) of Rule 506 of Regulation D under
the Act (“Rule 506”) in connection with the issuance and sale of the Securities in the Financing that have not been
waived pursuant to Rule 506(d)(2), and the Company has exercised reasonable care, including without limitation, conducting a factual
inquiry that is appropriate in light of the circumstances, into whether any such disqualification under Rule 506(d) exists as of
the date hereof; (ii) there are no matters that would have triggered disqualification under Rule 506(d) but which occurred before
September 23, 2013, and the Company has exercised reasonable care, including without limitation, conducting a factual inquiry that
is appropriate in light of the circumstances, into whether any such disqualification under Rule 506(d) would have existed before
September 23, 2013 and whether any disclosure is required to be made to potential Investors under Rule 506(e); and (iii) any outstanding
securities of the Company (of any kind or nature) that were issued in reliance on Rule 506 at any time on or after September 23,
2013 have been issued in compliance with Rule 506(d) and (e), and no party has any reasonable basis for challenging any such reliance
on Rule 506 in connection therewith.

 

	H.	GPN is a corporation duly organized, validly existing and in good standing
under the laws of the jurisdiction in which it was formed and has all requisite corporate power and authority to enter into this
Agreement and to carry out and perform its obligations under the terms of this Agreement.

 

	I.	This Agreement has been duly authorized, executed and delivered by GPN, and
upon due execution and delivery by the Company, this Agreement will be a valid and binding agreement of GPN enforceable against
it in accordance with its terms, except as may be limited by principles of public policy and, as to enforceability, subject to
applicable bankruptcy, insolvency, reorganization, moratorium and similar laws relating to or affecting creditor’s rights
from time to time in effect and subject to general equity principles.

 

	J.	GPN is a member of FINRA in good standing and is registered as a broker-dealer
under the Exchange Act and under the securities acts of each state into which it is making offers or sales of the Securities. None
of GPN or its affiliates, or any person acting on behalf of the foregoing (other than the Company, its or their affiliates or any
person acting on its or their behalf. in respect of which no representation is made) has taken nor will it take any action that
conflicts with the conditions and requirements of, or that would make unavailable with respect to the Financing, the exemption(s)
from registration available pursuant to Rule 506(b) of Regulation D, or knows of any reason why any such exemption would be otherwise
unavailable to it. GPN will conduct the Financing in compliance with all applicable securities laws.

 

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GP Nurmenkari Inc.

December 15, 2020

 

	K.	GPN agrees that it has not and will not directly or indirectly solicit offers
for, or offer to sell, the Securities (i) by means of general solicitation or general advertising (as those terms are used in Regulation
D) or (ii) in any manner that would not permit the Company to rely on Rule 506(b) of Regulation D and similar exceptions arising
under state securities or “blue sky” laws. The Company and GPN agree that the Financing will not be made pursuant to
Rule 506(c) of Regulation D under the Act.

 

	L.	GPN represents that neither it, nor to its knowledge any of its Sub-Agents
or any of its or their respective directors, executive officers, general partners, managing members or other officers participating
in the Financing (each, a “Placement Agent Covered Person” and, together, “Placement Agent Covered Persons”),
is or will be subject to any of the “Bad Actor” disqualifications described in Rule 506(d)(1)(i) to (viii) under the
Act (a “Disqualification Event”) or has or will have been involved in any matter which would be a Disqualification
Event except for the fact that it occurred before September 23, 2013.

 

	M.	GPN will notify the Company promptly in writing of any Disqualification Event
relating to any Placement Agent Covered Person not previously disclosed to the Company in accordance with the prior section.

 

	N.	GPN agrees to use all material non-public information provided to it by the
Company or on its behalf solely for the purpose of providing the services that are the subject of this Agreement and, except as
otherwise required by law, regulation or legal process, to treat all such information confidentially and not disclose such information
to any third party without the Company’s consent, other than to the GPN’s affiliates and their respective employees,
legal counsel, independent auditors and other experts or agents (“Representatives”) who need to know such information
in connection with the Financing. This undertaking will automatically terminate one (1) year following termination of this Agreement.
For avoidance of doubt, this Agreement shall not prohibit or restrict GPN or its Representatives from engaging in communications
directly with, or responding to any inquiry from, or providing information to, the SEC or FINRA whether or not notice is provided
to or consent is received from, the Company or confidential treatment is obtained with respect to such communications or disclosures.

 

	O.	Each of the Company and GPN shall confirm, as of the date of execution of
definitive documentation with Investors in the Financing (the “Transaction Documents”), the matters set forth in Sections
G and L above. In any event, the Company acknowledges that GPN shall be entitled to rely on, and will rely on, the representations
and warranties of the Company and the Investors set forth in the Transaction Documents with respect to the validity of the private
placement and applicable securities laws with respect to the Financing.

 

	P.	The Company hereby represents and warrants to GPN that, to the extent required
by applicable law, the Company will obtain representations from each Investor that is an employee benefit plan subject to the Employee
Retirement Income Security Act (“ERISA”) or a “plan” subject to section 4975 of the Internal Revenue Code
that GPN has not acted, and will not be treated, as an “investment advice fiduciary” (as contemplated in 29 C.F.R.
2510.3-21) for purposes of ERISA and section 4975 of the Internal Revenue Code, in connection with any Commitments by, or information
provided to, such Investor by reason of 29 C.F.R. 2510.3-21(c)(1) – the exception for “transactions with independent
fiduciaries with financial expertise.”

 

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GP Nurmenkari Inc.

December 15, 2020

 

	Q.	The Company hereby agrees that GPN shall be a third-party beneficiary of
the Company and purchaser representations and warranties set forth in the Subscription Agreement for the Financing.

 

		III.	Compensation / Payment for Services Performed

 

In consideration
for GPN’s services hereunder, the Company shall compensate GPN as follows:

 

		A.	The Company shall pay or cause GPN to be paid as follows:

 

(a)
At each closing under the Financing, the Company will pay a cash fee to GPN (the “Cash
Fee”) in amounts, equal, in the aggregate, to eight percent (8%) of the gross proceeds from the sale of Common Stock to Investors
at such closing. For purposes of the foregoing, the Cash Fee
shall be payable on sales of Common Stock to existing Company investors, management and/or their affiliates, friends and
families (“Inside Investors”). The Cash Fees shall be paid to GPN by wire transfer from
the escrow account to be established for the Financing with Delaware trust Company, and as a condition to closing, simultaneous
with the distribution of funds to the Company.

 

(b)
At each closing under the Financing, the Company will issue nontransferable warrants to GPN to purchase such number of shares
of Common Stock as is equal to eight percent (8.0%) of the number of shares of Common Stock sold in the Financing at such closing
to Investors that are not Inside Investors (the “Warrants”). The Warrants shall be issued to GPN or its designated
affiliates on the date of the closing of the Financing at which they are earned and shall be exercisable at a price of $2.00 per
share. The Warrants shall be for a term of 5 (five) years from the date of the first closing of the Financing and shall have cashless
exercise and such other provisions as are customary for warrants of this nature. The shares of Common Stock issuable upon exercise
of the Warrants shall be registered under the registration statement to be filed with respect to the Common Stock sold in the Financing.

 

(c) The Cash
Fee and the Warrants are not negotiable and are not subject to any reduction, set-off, counterclaim or refund for any reason or
matter whatsoever.

 

	B.	The Company understands that an Investor purchasing
Common Stock in the Financing may be interested in providing other financing for the benefit of the Company. The Company agrees
to compensate GPN in the same manner and in the same percentages as provided in Section III (A) (a) and (b) above with respect
to the amount of any financing received by the Company or any subsidiary of the Company from any Investor, exclusive of Inside
Investors, within the twelve (12) month period following the closing of the Financing at which such Investor invests (the
 “Tail Period”).

 

	C.	In the event the Offering is terminated prior to a closing, solely as the
result of action or inaction by the Company, the Company shall be required to pay a break-fee of Twenty-Five Thousand Dollars ($25,000)
(the “Break Fee”) to GPN at the time of termination.

 

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GP Nurmenkari Inc.

December 15, 2020

 

	D.	At the First Closing, the Company shall pay Twenty-Five Thousand Dollar
($25,000) to GPN as a non-accountable expense allowance.

 

	E.	In addition to the fees described in Sections III A.(a) and (b) above and
the obligation of the Company to pay certain expenses set forth in Sections II D., II E., and III D. above, at each closing the
Company will pay all of the reasonable and documented fees of GPN’s outside legal counsel, Lucosky Brookman LLP, incurred
in connection with the Financing, provided that such legal fees shall not exceed $35,000 in the aggregate.

 

		IV.	Miscellaneous

 

	A.	The term of this engagement will continue until the earlier of (i) March 31, 2021, or (ii) 10 days’
following written notice by either party at any time of such party’s desire to terminate this engagement and (iii) the final
closing of the Financing. The representations set forth in Section II, and the provisions of III(A), III(B),III(C), IV(C), IV(D),
IV(E), IV(F) and IV(G) hereof shall survive any expiration or termination of this Agreement.

 

	B.	GPN is being retained to serve as the exclusive placement agent solely to
the Company with respect to the Financing, and it is agreed that the engagement of GPN is not, and shall not be deemed to be, on
behalf of, and is not intended to, and will not, confer rights or benefits upon any shareholder or creditor of the Company or upon
any other person or entity. No one other than the Company is authorized to rely upon this engagement of GPN or any statements,
conduct, or advice of GPN, and no one other than the Company is intended to be a beneficiary of this engagement. All opinions,
advice, or other assistance (whether written or oral) given by GPN in connection with this engagement are intended solely for the
benefit and use of the Company and will be treated by the Company as confidential, and no opinion, advice, or other assistance
of GPN shall be used for any other purpose or reproduced, disseminated, quoted, or referred to at any time, in any manner or for
any purpose, nor shall any public or other references to GPN (or to such opinions, advice, or other assistance) be made without
the express prior written consent of GPN.

 

	C.	The Company agrees that, following the closing or consummation of the Financing,
GPN has the right to place an announcement on its website and/or advertisements in financial and other newspapers and journals
at its own expense, describing its services to the Company and a general description of the Financing; provided, that, GPN shall
submit an initial copy of any announcement or advertisement to the Company for its approval prior to any publication thereof (such
approval not to be unreasonably withheld, conditioned or delayed); provided further that GPN shall not be required to submit any
announcement or advertisement which is substantially similar to an announcement or advertisement previously approved by the Company.
In addition, the Company agrees to include in any press release or public announcement announcing the Financing a reference to
GPN’s role as exclusive placement agent to the Company with respect to the Financing, provided that the Company will submit
a copy of any such press release or public announcement to GPN for its prior approval, which approval shall not be unreasonably
withheld or delayed.

 

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GP Nurmenkari Inc.

December 15, 2020

 

	D.	The Company acknowledges and agrees that GPN is a securities firm which
may be engaged at various times, either directly or through its affiliates, in various activities. In the ordinary course of these
activities, which may conflict with the interests of the Company, GPN and its affiliates from time-to-time may: (i) effect transactions
for its own account or the accounts of its clients and hold long or short positions in debt or equity securities or other financial
instruments (or related derivative instruments) of the Company or other parties which may be the subject of this engagement or
any transaction contemplated hereby; (ii) subject to the confidentiality requirements of this Agreements, have had confidential
discussions with, and provided information to, clients, potential clients financial investors, or other parties in the Company’s
industry (including competitors) regarding various market and strategic matters (including potential strategic alternatives or
transactions that may involve the Company); and/or (iii) have performed, or sought to perform, various investment banking, financial
advisory or other services for clients who may have conflicting interests with respect to the Company.

 

	E.	The terms and provisions of this Agreement are solely for the benefit of
the Company and GPN and the other Indemnified Persons and their respective successors, assigns, heirs, and personal representatives,
and no other person shall acquire or have any right by virtue of this Agreement. The Company and GPN acknowledge and agree that
GPN is acting as an independent contractor, and is not a fiduciary of, nor will its engagement hereunder give rise to fiduciary
duties to, the Company or the Company’s shareholders. This Agreement represents the entire understanding between the Company
and GPN with respect to the Financing and GPN’s engagement hereunder, and all prior discussions are merged herein. This Agreement
may be executed in two or more counterparts (including fax or electronic counterparts), all of which together will be considered
a single instrument. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT
REGARD TO SUCH STATE’S PRINCIPLES OF CONFLICTS OF LAWS, AND MAY BE AMENDED, MODIFIED OR SUPPLEMENTED ONLY BY WRITTEN INSTRUMENT
EXECUTED BY EACH OF THE PARTIES HERETO.

 

	F.	It is understood that GPN’s obligation under this Agreement is to use
its commercially reasonable “best efforts” throughout the period for which it acts as the Company’s exclusive
placement agent as described herein. GPN’s engagement is not intended to provide the Company or any other person or entity
with any assurances that the Financing or other transaction will be consummated, and in no event will GPN be obligated to purchase
Securities for its own account or the accounts of its customers.

 

	G.	The parties hereby submit to the jurisdiction of and venue in the federal
courts located in the City of New York, New York in connection with any dispute related to this Agreement, any transaction contemplated
hereby, or any other matter contemplated hereby. If for any reason jurisdiction and/or venue is unavailable in such federal courts,
then the parties hereby submit to the jurisdiction of and venue in the state courts located in such city in connection with any
such dispute or matter. In addition, the parties hereby waive any right to a trial by jury with respect to any such dispute or
matter.

 

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GP Nurmenkari Inc.

December 15, 2020

 

If the
foregoing correctly sets forth the entire understanding and agreement between GPN and the Company, please so indicate in the space
provided for that purpose below and return an executed copy to us, whereupon this letter shall constitute a binding agreement as
of the date first above written.

 

 

	 	GP NURMENKARI INC.
	 	 
	 	By: 	/s/ Albert Pezone
	 	Name:	Albert Pezone
	 	Title:	Chief Executive Officer

 

	 	 
	AGREED, as of December 15, 2020:	 
	 	 
	SMARTKEM LIMITED	 
	 	 
	By:	 /s/ Robert Bahns	 
	Name:	Robert Bahns	 
	Title:	Chief Financial Officer	 

 

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GP Nurmenkari Inc.

December 15, 2020

 

ATTACHMENT A

 

GP
NURMENKARI INC.

INDEMNIFICATION,
CONTRIBUTION, AND 

LIMITATION OF LIABILITY PROVISIONS

 

		(a)	The Company will: (i) indemnify and hold harmless GPN and its agents and
their respective officers, directors, employees, agents, selected dealers and each person, if any, who controls GPN within the
meaning of the Act and such agents (each an “Indemnitee” or a “Placement Agent Party”) against, and pay
or reimburse each Indemnitee for, any and all losses, claims, damages, liabilities or expenses whatsoever (or actions or proceedings
or investigations in respect thereof (collectively, “Proceedings”), joint or several (which will, for all purposes
of this Agreement, include, but not be limited to, all reasonable costs of defense and investigation and all reasonable attorneys’
fees, including appeals), to which any Indemnitee may become subject under the Act or otherwise, in connection with the offer and
sale of the Securities as a result of the breach of any representation, warranty or covenant made by the Company herein or the
failure of the Company to perform its obligations under the Agreement, regardless of whether such losses, claims, damages, liabilities
or expenses shall result from any claim by any Indemnitee or by any third party; and (ii) reimburse each Indemnitee for any legal
or other out-of-pocket expenses reasonably incurred in connection with investigating or defending against any such loss, claim,
action, proceeding or investigation; provided, however, the Company will not be liable in any such case to the extent that any
such claim, damage or liability of GPN resulted from (A) any untrue statement or alleged untrue statement of any material fact
contained in the offering materials for the Financing (the “Financing Materials”) made in reliance upon and in conformity
with information contained in the Financing Materials relating to GPN or its Representatives, or an omission or alleged omission
to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, in either
case, if made or omitted in reliance upon and in conformity with written information furnished to the Company by GPN, specifically
for use in the preparation thereof, (B) any violations by GPN of the Act, state securities laws or any rules or regulations of
FINRA, which does not result from a violation thereof by the Company, (C) any breach of any representation, warranty or covenant
made by GPN herein or the failure of GPN to perform its obligations under this Agreement or (D) GPN’s gross negligence or
willful misconduct. In addition to the foregoing agreement to indemnify and reimburse, the Company will indemnify and hold harmless
each Indemnitee against any and all losses, claims, damages, liabilities or expenses whatsoever (or actions or proceedings or investigations
in respect thereof), joint or several (which shall, for all purposes of this Agreement, include, but not be limited to, all reasonable
costs of defense and investigation and all reasonable attorneys’ fees, including appeals) to which any Indemnitee may become
subject insofar as such costs, expenses, losses, claims, damages or liabilities arise out of or are based upon the claim of any
person or entity that he or it is entitled to broker’s or finder’s fees from any Indemnitee in connection with the
Financing as a result of the Company obligating itself or any Indemnitee to pay such a fee, other than fees due to GPN, its dealers,
sub-agents or finders and other than fees payable to Montrose Capital Partners Limited. The foregoing indemnity agreements will
be in addition to any liability the Company may otherwise have. The Indemnitees are intended third party beneficiaries of this
provision.

 

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GP Nurmenkari Inc.

December 15, 2020

 

		(b)	GPN will: (i) indemnify and hold harmless the Company, and its agents and
their respective officers, directors, employees, agents, and each person, if any, who controls the Company within the meaning of
the Act and such agents (each a “Company Indemnitee” or a “Company Party”) against, and pay or reimburse
each Company Indemnitee for, any and all losses, claims, damages, liabilities or expenses whatsoever (or Proceedings, joint or
several, (which will, for all purposes of this Agreement, include, but not be limited to, all reasonable costs of defense and investigation
and all reasonable attorneys' fees and expenses, including appeals)), to which any Company Indemnitee may become subject under
the Act or otherwise, in connection with the offer and sale of the Securities as a result of (A) any untrue statement or alleged
untrue statement of any material fact contained in the Financing Materials made in reliance upon and in conformity with information
contained in the Financing Materials relating to GPN or its Representatives, or an omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make the statements therein not misleading, in either case, if made
or omitted in reliance upon and in conformity with written information furnished to the Company by GPN, specifically for use in
the preparation thereof, (B) the breach of any representation, warranty or covenant made by GPN herein or the failure of GPN to
perform its obligations under the Agreement, regardless of whether such losses, claims, damages, liabilities or expenses shall
result from any claim by any Indemnitee or by any third party, or (C) any violations by GPN of the Act, state securities laws or
any rules or regulations of FINRA, which does not result from a violation thereof by the Company, and (ii) reimburse each Company
Indemnitee for any legal or other expenses reasonably incurred in connection with investigating or defending against any such loss,
claim, action, proceeding or investigation; provided, however, in no event (except in the event of gross negligence, fraud or illegal
or willful misconduct by GPN to the extent and only to the extent if found in a final judgment by a court of competent jurisdiction)
shall GPN's indemnification obligation hereunder exceed the aggregate amount of the consideration paid by the Company hereunder
(based on the fair value of the Warrants on the date of issuance) actually received by GPN or its Representatives. The foregoing
indemnity agreements will be in addition to any liability GPN may otherwise have to persons that are not Company Parties. The Company
Indemnitees are intended third party beneficiaries of this provision.

 

		(c)	Promptly after receipt by an indemnified party under this Attachment A of
notice of the commencement of any action, claim, proceeding or investigation (the “Action”), such indemnified party,
if a claim in respect thereof is to be made against the indemnifying party under this Attachment A, will notify the indemnifying
party of the commencement thereof, but the omission to so notify the indemnifying party will not relieve it from any liability
that it may have to any indemnified party under this Attachment A unless the indemnifying party has been substantially prejudiced
by such omission. The indemnifying party will be entitled to participate in and, to the extent that it may wish, jointly with any
other indemnifying party, to assume the defense thereof subject to the provisions herein stated, with counsel reasonably satisfactory
to such indemnified party. The indemnified party will have the right to employ separate counsel in any such Action and to participate
in the defense thereof, but the fees and expenses of such counsel will not be at the expense of the indemnifying party if the indemnifying
party has assumed the defense of the Action with counsel reasonably satisfactory to the indemnified party, provided, however, that
if the indemnified party shall be requested by the indemnifying party to participate in the defense thereof or shall have concluded
in good faith and specifically notified the indemnifying party either that there may be specific defenses available to it that
are different from or additional to those available to the indemnifying party or that such Action involves or could have a material
adverse effect upon it with respect to matters beyond the scope of the indemnity agreements contained in this Agreement, then the
counsel representing it, to the extent made necessary by such defenses, shall have the right to direct such defenses of such Action
on its behalf and in such case the reasonable fees and expenses of such counsel in connection with any such participation or defenses
shall be paid by the indemnifying party. No settlement of any Action against an indemnified party will be made without the consent
of the indemnifying party and the indemnified party, which consent shall not be unreasonably withheld, conditioned or delayed in
light of all factors of importance to such party, and no indemnifying party shall be liable to indemnify any person for any settlement
of any such claim effected without such indemnifying party’s consent. Notwithstanding the immediately preceding sentence,
if at any time an indemnified party requests the indemnifying party to reimburse the indemnified party for legal or other expenses
in connection with investigating, responding to or defending any Proceedings as contemplated by this indemnity agreement, the indemnifying
party will be liable for any settlement of any Proceedings effected without its written consent if (i) the proposed settlement
is entered into more than 60 days after receipt by the indemnifying party of the request for reimbursement for any amounts that
have not been disputed in good faith by the indemnifying party, (ii) the indemnifying party has not reimbursed the indemnified
party within 60 days of such request for reimbursement, (iii) the indemnified party delivered written notice to the indemnifying
party of its intention to settle and the failure to pay within such 60 day period, and (iv) the indemnifying party does not, within
30 days of receipt of the notice of the intention to settle and failure to pay, reimburse the indemnified party for such legal
or other expenses that have not been disputed in good faith by the indemnifying party and object to the indemnified party’s
seeking to settle such Proceedings.

 

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December 15, 2020

 

		(d)	To provide for just and equitable contribution, if: (i) an indemnified party
makes a claim for indemnification pursuant to this Attachment A hereof and it is finally determined, by a judgment, order or decree
not subject to further appeal that such claims for indemnification may not be enforced, even though this Agreement expressly provides
for indemnification in such case; or (ii) any indemnified or indemnifying party seeks contribution under the Act, the Exchange
Act, or otherwise, then each indemnifying party shall contribute to such amount paid or payable by such indemnified party in such
proportion as is appropriate to reflect not only such relative benefits but also the relative fault of the Company on the one hand
and GPN on the other in connection with the statements or omissions which resulted in such losses, claims, damages, liabilities
or expenses (or actions in respect thereof), as well as any other relevant equitable considerations. The relative benefits received
by the Company on the one hand and GPN on the other shall be deemed to be in the same proportion as the total net proceeds from
the Financing received by the Company bear to the total compensation received by GPN and its Representatives. The relative fault,
in the case of an untrue statement, alleged untrue statement, omission or alleged omission will be determined by, among other things,
whether such statement, alleged statement, omission or alleged omission relates to information supplied by the Company or by GPN
and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement,
alleged statement, omission or alleged omission. The Company and GPN agree that it would be unjust and inequitable if the respective
obligations of the Company and GPN for contribution were determined by pro rata allocation of the aggregate losses, liabilities,
claims, damages and expenses or by any other method or allocation that does not reflect the equitable considerations referred to
in this clause (d). No person guilty of a fraudulent misrepresentation (within the meaning of Section 10(f) of the Act) will be
entitled to contribution from any person who is not guilty of such fraudulent misrepresentation. For purposes of this clause (d),
each person, if any, who controls GPN within the meaning of the Act will have the same rights to contribution as GPN, and each
person, if any, who controls the Company within the meaning of the Act will have the same rights to contribution as the Company,
subject in each case to the provisions of this clause (d). Anything in this clause (d) to the contrary notwithstanding, no party
will be liable for contribution with respect to the settlement of any claim or action effected without its written consent. This
clause (d) is intended to supersede, to the extent permitted by law, any right to contribution under the Act, the Exchange Act
or otherwise available.

 

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December 15, 2020

 

EXHIBIT
A – TERM SHEET

 

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